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The End Of Economics And The Last (Stock)Man

Politics / Economic Theory Sep 19, 2013 - 02:59 AM GMT

By: Andrew_McKillop


“The most effective way to destroy people is to deny and obliterate their understanding of their own history.”  ~ George Orwell.

In George Orwell‘s “Nineteen Eighty-Four”, written in 1948, the Ministry of Truth is responsible for all needed falsification of historical events, and the obliteration of all preceding interpretation of these events.

In Francis Fukuyama's “The End of History and The Last Man”, written in 1992, he said: “What we may be witnessing is not just the end of the Cold War.......but the end of history as such: that is the end point of mankind's ideological evolution and the universalization of Western liberal democracy as the final form of human government”.

Fukuyama mysteriously opined that “Events still occur at the end of history”, before going on to claim that since the French Revolution, democracy has repeatedly proven to be a better system than any other, adding that “the European Union more accurately reflects what the world will look like at the end of history than the contemporary United States”.

To be sure, forgetting all past historical events is almost as good as falsifying them. British prime minister Lord Palmerston, in the 1860s said: “Only three people have ever really understood the Schleswig-Holstein business—the Prince Consort, who is dead—a German professor, who has gone mad—and I, who have forgotten all about it". Forgetting everything, today, is arguably the favored method used in what Benjamin Barber in his 1996 book called the “Jihad Versus McWorld” struggle. This epic struggle pitches the McWorld of a supposed secular, liberal, corporate- and consumer-friendly transformation of the world and the economy, against the “jihad" of all competing forces, featuring sectarianism or tribalism and religious fundamentalism, especially Islamic fundamentalism.

Fukuyama, with time, felt able to concede that democracy often has “its substance gutted” but did not extend that to the economy. Economic fundamentalism, redefined by the Ministry of Truth as the tyranny of banksters, brokers, traders and crony capitalists however reigns unopposed today – for the moment. Only the insane could believe that is a lasting context and process. What Newspeak calls “the capitalist market economy” has for years been an ongoing disaster, also menaced because this lose-lose economic model does not operate outside History. And History continues.

The dates and numbers are well known.

For David Stockman, the $700 billion TARP (Troubled Asset Relief Program) bill to bail out Wall Street, approved by the Bush regime on October 3, 2008, including multi-trillion-dollar support lines for the big (and bad) banks and the even worse insurance companies, brokers and other crony financial companies, was a sinister but ongoing event - “the latest brick in the foundation of a fundamentally anti-capitalist régime known as TBTF Too Big to Fail”.

Stockman said it had been under construction for many decades, in fact at least three decades but since late 2008 has reached a point so extreme there is no turning back.

As the former OMB Budget director of Ronald Reagan, Stockman has credible figures for the “excess debt” racked up by crony capitalism in the US, since the 1980s when economics “as we knew it” ceased to exist. He calculates that by October 2008, before TARP and the following Obama debt recovery plans, as they are called by the Ministry of Truth, US debt outstanding was already $52 trillion, at least $22 trillion more than it would have been if any previous rate of debt growth known in the USA for the past 160 years had applied. Obama has done nothing but keep the party going.

All kinds of ultra-simple economic consequences result from this pure and simple madness, for example extremely low or no economic growth “forever”.

Because the blip economy “blipped down” with powerful additional tailwinds from crony capitalism, this makes equity market leveraging the only hope for Consumer Capitalists “at the end of History”. Markets can only rise – except when they fall. The Catch 22 is markets have to rise, to keep the punters happy. As of present, September 2013, equity and oil market prices have reached vintage extremes of hysterical unreality, but because the “real economy” no longer exists, smart manipulators can pretend “nobody knew that” and crank them up a little longer!

Outside the economic domain, since September 2001 not only historians, philosophers, Marxists and liberals have heavily criticized the claims of Fukuyama, but also the mainstream media – the guardians and polluters of the public mind. Their question is:

If History is dead, why did 9/11 happen?

In an August 28, 2008 Op-ed published by 'Washington Post', Fukuyama still making a rearguard defence of his theory was forced to add the absurd claim that: “Sunni radicalism has been remarkably ineffective in actually taking control of a nation-state, due to its propensity to devour its own potential supporters”. Presumably he never heard of Saudi Arabia and the other Gulf states?

Fukuyama also said disenfranchised Muslims might thrill to the rantings of Osama bin Laden or Iran's then president Mahmoud Ahmadinejad, “but the appeal of this kind of medieval Islamism is strictly limited”. He was much too polite to apply that to George W. Bush's rants extolling economic fundamentalism, a decayed interpretation of Adam Smith economic nostrums from the 18th century, which History itself since 2008 has heavily criticized.

In the British parliament in the 1850s, Lord Palmerston said “We have no eternal allies, and we have no perpetual enemies. Our interests are eternal and perpetual, and those interests it is our duty to follow”. Having rewritten and obliterated economics and its history, the Ministry of Truth moves on to do the same with international relations. For “the economy” Newspeak says that 2 + 2 = 5 when the situation warrants, which is now permanent, but geopolitical actions and relations have also been thrown into the witches' cauldron, to be degenerated and mutated into what the long-running Syrian crisis shows us.

Only theoretically, the world's supply of oil and highly theoretical gas pipelines bringing Qatari gas to Europe across Syria, when it is under new management, are now in play and threatened. Without what John Kerry calls “unbelievably small” military action against the Syrian regime, action paid for by Saudi Arabia, Qatar and other Gulf states, the world faces an unparalleled oil crisis. Alternately, the Ministry of Truth continues when that line of propaganda pales, Syria will become a hotbed of Islamic fundamentalism unless it is given the “unbelievably small” military treatment.

Not only Stockman but many others have analyzed and produced their own theories on “what really happened”, to the economy, society, politics and international relations. Side issues crowd into the high ground, obscuring the real process that happened. For example the Ayn Rand “greed business” or greed disease theory is often dangled as the reason why the economy spun out of control, into a black hole.

More rationally, the continued growth of the State, now in a death embrace with crony finance and crony industry, and crony service sector corporations, has twined with central banking to embark on magic carpet ride to we literally do not know where. Far below that level, ongoing but now ritualized events and processes – like economic and financial markets – have dislocated. To be sure we could like Stockman say they have been perverted and deformed, but this is a truly historic return to source. At the time of Adam Smith's trip to Europe in the 1760s, meeting quack charlatan “economists” like Francois Quesnay, the stock market was exactly what Wall Street has become today - a vast casino where leveraged speculation and rent seeking totally obliterate and replace its previous vital function of price setting and discovery, capital allocation and the creation of sustainable economic activity.

The 2008 financial crisis should have led to a massive deflation of Wall Street behemoths fostered by decades of money printing and market rigging. The bad banks should have gone to the wall, but due to sheer lack of courage, aided by arrogance and stupidity, political deciders of the so-called free world played Double or Quits.

As of present, five years on, we are not able to say how long it takes for a final declaration that The Party's Over. In a constant and somber layering and overlaying of myths, lies and propaganda the Double or Quits process is stoically applied – even in the case of the Syrian crisis. The elite hope is that another 2011 Libyan war, or 2003 Iraq war, or 2001 Afghan war can be cranked up again – to enthrall consumer democrats huddled around their home entertainment TV console, supping smart missile clips and gorging themselves on scenes of death and destruction – a nice safe distance away.

What we do know, however, is that neither the fantasy economy, nor geopolitical folly are working. Their most important or fundamental role – to obliterate and replace reality – are failing to “win hearts and minds”, failing to destroy reality, making it certain we are close to epic historical changes.

By Andrew McKillop


Former chief policy analyst, Division A Policy, DG XVII Energy, European Commission. Andrew McKillop Biographic Highlights

Co-author 'The Doomsday Machine', Palgrave Macmillan USA, 2012

Andrew McKillop has more than 30 years experience in the energy, economic and finance domains. Trained at London UK’s University College, he has had specially long experience of energy policy, project administration and the development and financing of alternate energy. This included his role of in-house Expert on Policy and Programming at the DG XVII-Energy of the European Commission, Director of Information of the OAPEC technology transfer subsidiary, AREC and researcher for UN agencies including the ILO.

© 2013 Copyright Andrew McKillop - All Rights Reserved Disclaimer: The above is a matter of opinion provided for general information purposes only and is not intended as investment advice. Information and analysis above are derived from sources and utilising methods believed to be reliable, but we cannot accept responsibility for any losses you may incur as a result of this analysis. Individuals should consult with their personal financial advisor.

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