Economy Crisis Quotes

You know what's truly weird about any financial crisis? We made it up. Currency, money, finance, they're all social inventions. When the sun comes up in the morning it's shining on the same physical landscape, all the atoms are in place.

Congress shall make no law abridging the freedom of production and trade...

The present convergence of crises––in money, energy, education, health, water, soil, climate, politics, the environment, and more––is a birth crisis, expelling us from the old world into a new.

I will feel no guilt on shutting my door to those who didn't listen.

Thirty years of "crisis," mass unemployment, and flagging growth, and they still want us to believe in the economy. . . . We have to see that the economy is itself the crisis.

Had history been democratic in its ways, there would have been no farming and no industrial revolution. Both leaps into the future were occasioned by unbearably painful crises that made most people wish they could recoil into the past.

If you believe that hard work pays off, then you work hard; if you think it’s hard to get ahead even when you try, then why try at all? Similarly, when people do fail, this mind-set allows them to look outward. I once ran into an old acquaintance at a Middletown bar who told me that he had recently quit his job because he was sick of waking up early. I later saw him complaining on Facebook about the “Obama economy” and how it had affected his life. I don’t doubt that the Obama economy has affected many, but this man is assuredly not among them. His status in life is directly attributable to the choices he’s made, and his life will improve only through better decisions. But for him to make better choices, he needs to live in an environment that forces him to ask tough questions about himself. There is a cultural movement in the white working class to blame problems on society or the government, and that movement gains adherents by the day.

This story is the ultimate example of American’s biggest political problem. We no longer have the attention span to deal with any twenty-first century crisis. We live in an economy that is immensely complex and we are completely at the mercy of the small group of people who understand it – who incidentally often happen to be the same people who built these wildly complex economic systems. We have to trust these people to do the right thing, but we can’t, because, well, they’re scum. Which is kind of a big problem, when you think about it.

I think the answer is far more simple than many have led us to believe: we have not done the things that are necessary to lower emissions because those things fundamentally conflict with deregulated capitalism, the reigning ideology for the entire period we have been struggling to find a way out of this crisis. We are stuck because the actions that would give us the best chance of averting catastrophe—and would benefit the vast majority—are extremely threatening to an elite minority that has a stranglehold over our economy, our political process, and most of our major media outlets.

Engineers do engineering, i.e. they build bridges. So engineering needs engineers. The economy does NOT need economists. Economists do not make economy, but they try it and that is why we have so much problems with some financial models.

So my mind keeps coming back to the question: what is wrong with us? What is really preventing us from putting out the fire that is threatening to burn down our collective house? I think the answer is far more simple than many have led us to believe: we have not done the things that are necessary to lower emissions because those things fundamentally conflict with deregulated capitalism, the reigning ideology for the entire period we have been struggling to find a way out of this crisis. We are stuck because the actions that would give us the best chance of averting catastrophe—and would benefit the vast majority—are extremely threatening to an elite minority that has a stranglehold over our economy, our political process, and most of our major media outlets.

Even if we could grow our way out of the crisis and delay the inevitable and painful reconciliation of virtual and real wealth, there is the question of whether this would be a wise thing to do. Marginal costs of additional growth in rich countries, such as global warming, biodiversity loss and roadways choked with cars, now likely exceed marginal benefits of a little extra consumption. The end result is that promoting further economic growth makes us poorer, not richer.

Oh, and 13.1 million American people had their homes foreclosed. Because their debt, it turns out, was real; it was only the debt within the financial sector that was imaginary. It was only the people who generated the crisis who got three magical wishes from an economic genie. There was no abracadabra for ordinary people; they just got abraca-fucked.

We are not going through an "economy crisis"; we are going through a "spiritual transition". On a deeper level, the collective conscious of humanity is awakening.

That we are in the midst of crisis is now well understood. Our nation is at war, against a far-reaching network of violence and hatred. Our economy is badly weakened, a consequence of greed and irresponsibility on the part of some, but also our collective failure to make hard choices and prepare the nation for a new age. Homes have been lost; jobs shed; businesses shuttered. Our health care is too costly; our schools fail too many; and each day brings further evidence that the ways we use energy strengthen our adversaries and threaten our planet.

Regular crises perpetuate the past by reinvigorating cycles which started long ago. In contrast, (capital-C) Crises are the past's death knell. They function like laboratories in which the future is incubated. They have given us agriculture and the industrial revolution, technology and the labour contract, killer germs and antibiotics. Once they strike, the past ceases to be a reliable predictor of the future and a brave new world is born.

These are tough times for state governments. Huge deficits loom almost everywhere, from California to New York, from New Jersey to Texas. Wait—Texas? Wasn't Texas supposed to be thriving even as the rest of America suffered? Didn't its governor declare, during his re-election campaign, that 'we have billions in surplus'? Yes, it was, and yes, he did. But reality has now intruded, in the form of a deficit expected to run as high as $25 billion over the next two years. And that reality has implications for the nation as a whole. For Texas is where the modern conservative theory of budgeting—the belief that you should never raise taxes under any circumstances, that you can always balance the budget by cutting wasteful spending—has been implemented most completely. If the theory can't make it there, it can't make it anywhere.

For when a nation founded on the belief in racial hierarchy truly rejects that belief then and only then will we have discovered a new world. That is our destiny. To make it manifest, we must challenge ourselves to live our lives in solidarity across color, origin, and class. We must demand changes to the rules in order to disrupt the very notion that those who have more money are worth more in our democracy and our economy. Since this country’s founding, we have not allowed our diversity to be our superpower and the result is that the United States is not more than the sum of its disparate parts. But it could be. And if it were, all of us would prosper. In short, we must emerge from this crisis in our republic with a new birth of freedom. Rooted in the knowledge that we are so much more, when the we in we the people is not some of us, but all of us. We are greater than and greater for the sum of us.

if we consider the total growth of the US economy in the thirty years prior to the crisis, that is, from 1977 to 2007, we find that the richest 10 percent appropriated three-quarters of the growth. The richest 1 percent alone absorbed nearly 60 percent of the total increase of US national income in this period. Hence for the bottom 90 percent, the rate of income growth was less than 0.5 percent per year.

The problem with the 'masculinity crisis' is not that women have excelled too much and therefore created a crisis for men, but that we have such a stein inability to let go of what it has traditionally meant to be a man...As long as we perpetuate the myth that men have inherent qualities that make them more suitable than women for certain types of work, the shifting nature of the economy (and women's attainment of better jobs) is going to continue to be interpreted as a crisis of masculinity.

If we think in term of months, we had probably focus on immediate problems such as the turmoil in the Middle East, the refugee crisis in Europe and the slowing of the Chinese economy. If we think in terms of decades, then global warming, growing inequality and the disruption of the job market loom large. Yet if we take the really grand view of life, all other problems and developments are overshadowed by three interlinked processes: 1.​Science is converging on an all-encompassing dogma, which says that organisms are algorithms and life is data processing. 2.​Intelligence is decoupling from consciousness. 3.​Non-conscious but highly intelligent algorithms may soon know us better than we know ourselves. These three processes raise three key questions, which I hope will stick in your mind long after you have finished this book: 1.​Are organisms really just algorithms, and is life really just data processing? 2.​What’s more valuable – intelligence or consciousness? 3.​What will happen to society, politics and daily life when non-conscious but highly intelligent algorithms know us better than we know ourselves?

Pope Benedict XVI was the first to predict the crisis in the global financial system…Italian Finance Minister Giulio Tremonti said. “The prediction that an undisciplined economy would collapse by its own rules can be found” in an article written by Cardinal Joseph Ratzinger [in 1985], Tremonti said yesterday at Milan’s Cattolica University. —Bloomberg News, November 20, 2008

This crisis didn’t have to happen. America had a boom-and-bust cycle from the 1790s to the 1930s, with a financial panic every ten to fifteen years. But we figured out how to fix it. Coming out of the Great Depression, the country put tough rules in place that gave us fifty years without a financial crisis. But in the 1980s, we started pulling the threads out of the regulatory fabric, and we found ourselves back in the boom-and-bust cycle. When this crisis is over, there will be a once-in-a-generation chance to rewrite the rules. What we set in place will determine whether our country continues down this path toward a boom-and-bust economy or whether we reestablish an economy with more stability that gives ordinary folks a chance at real prosperity.

The gap between financial capital of US$190 trillion looking for highly profitable investment opportunities and a real economy and social sector without access to the financial capital needed to operate and grow is at the heart of the worldwide economic crisis.

Thomas Friedman, in his best-selling book The Lexus and the Olive Tree, declared that what happened in Asia wasn’t a crisis at all. “I believe globalization did us all a favor by melting down the economies of Thailand, Korea, Malaysia, Indonesia, Mexico, Russia, and Brazil in the 1990s, because it laid bare a lot of rotten practices and institutions,

We have to see that the economy is not "in" crisis, the economy is itself the crisis. It's not that there's not enough work, it's that there is too much of it.

World needs a new order of modern economy.

In light of our current crisis, nothing could be more spiritual than saving our children from humanism, our economy from deprivation, and our liberty from extinction.

Jesus was crucified for humanity, I am being crucified for love.

Southern slave economy, sharecroppers after that, coal miners after that, and machinists and millworkers during more recent times.

To avert climate crises, it's important that humanity shifts to permaculture economics, fostering resilience and cooperation.

To avert climate crisis, it's important that humanity recognizes the intrinsic value of nature, beyond its convertible utility.

The sobering truth is that the heroes of the immediate COVID-19 crisis, those who (at personal risk) took care of the sick and kept the economy ticking, are among the worst paid professionals – the nurses, the cleaners, the delivery drivers, the workers in food factories, care homes and warehouses, among others.

That we are in the midst of crisis is now well understood. Our nation is at war, against a far-reaching network of violence and hatred. Our economy is badly weakened, a consequence of greed and irresponsibility on the part of some, but also our collective failure to make hard choices and prepare the nation for a new age. Homes have been lost; jobs shed; businesses shuttered. Our health care is too costly; our schools fail too many; and each day brings further evidence that the ways we use energy strengthen our adversaries and threaten our planet. These are the indicators of crisis, subject to data and statistics. Less measurable but no less profound is a sapping of confidence across our land — a nagging fear that America's decline is inevitable, and that the next generation must lower its sights. Today I say to you that the challenges we face are real. They are serious and they are many. They will not be met easily or in a short span of time. But know this, America — they will be met. On this day, we gather because we have chosen hope over fear, unity of purpose over conflict and discord. On this day, we come to proclaim an end to the petty grievances and false promises, the recriminations and worn out dogmas, that for far too long have strangled our politics.

Despite the topographical differences and the different regional economies of the South and the industrial Midwest, my travels had been confined largely to places where the people looked and acted like my family. We ate the same foods, watched the same sports, and practiced the same religion. That’s why I felt so much kinship with those people at the courthouse: They were hillbilly transplants in one way or another, just like me.

The impoverished families of the long-term unemployed strained to the point of dysfunction, communities deprived of viable economies, interrupted educations, lost skills: these and many more results of capitalism’s crisis will put difficult demands on governments for years. On the one hand, they will aggravate social problems that impose costs on governments.

The most recent global financial crisis reminded the current generation of the lessons that their grandparents had learned in the Great Depression: the self-regulating economy does not always work as well as its proponents would like us to believe.

Yet we promise developing countries that, if they will only adopt good policies, like honest government and free market economies, they too can become like the First World today. That promise is utterly impossible, a cruel hoax. We are already having difficulty supporting a First World lifestyle even now, when only 1 billion people out of the world’s 7.5 billion people enjoy it.

In the past decade, we have transitioned from an innovation economy to an exploitation economy. Innovation is dangerous and unpredictable. It changes market dynamics and creates opportunities for nimble new players to steal share from established players.

The Marshall Plan was the ultimate weapon deployed on this economic front. After the war, the German economy was in crisis, threatening to bring down the rest of Western Europe. Meanwhile, so many Germans were drawn to socialism that the U.S. government opted to split Germany into two parts rather than risk losing it all, either to collapse or to the left. In West Germany, the U.S. government used the Marshall Plan to build a capitalist system that was not meant to create fast and easy new markets for Ford and Sears but, rather, to be so successful on its own terms that Europe’s market economy would thrive and socialism would be drained of its appeal.

This generation of Wall Street CEOs could be the ones to forfeit America’s trust. When the history of the Great Recession is written, they can be singled out as the bonus babies who were so shortsighted that they put the economy at risk and contributed to the destruction of their own companies. Or they can acknowledge how Americans’ trust has been lost and take the first steps to earn it back.

In this century history stopped paying attention to the old psychological orientation of reality. I mean, these days, character isn't destiny any more. Economy is destiny. Ideology is destiny. Bombs are destiny. What does a famine, a gas chamber, a grenade care how you lived your life? Crisis comes, death comes, and your pathetic individual self doesn't have a thing to do with it, only to suffer the effects.

The United States thus achieved what no earlier imperial system had put in place: a flexible form of global exploitation that controlled debtor countries by imposing the Washington Consensus via the IMF and World Bank, while the Treasury bill standard obliged the payments-surplus nations of Europe and East Asia to extend forced loans to the U.S. Government. Against dollar-deficit regions the United States continued to apply the classical economic leverage that Europe and Japan were not able to use against it. Debtor economies were forced to impose economic austerity to block their own industrialization and agricultural modernization. Their designated role was to export raw materials and provide low-priced labor whose wages were denominated in depreciating currencies. Against dollar-surplus nations the United States was learning to apply a new, unprecedented form of coercion. It dared the rest of the world to call its bluff and plunge the international economy into monetary crisis. That is what would have happened if creditor nations had not channeled their surplus savings to the United States by buying its Government securities.

As Jeffrey Reiman points out in the Rich Get Richer and the Poor Get Prison, the criminal justice system excuses and ignores crimes of the rich that produce profound social harms while intensely criminalizing the behaviors of the poor and nonwhite, including those behaviors that produce few social harms. When the crimes of the rich are dealt with, it’s generally through administrative controls and civil enforcement rather than aggressive policing, criminal prosecution, and incarceration, which are reserved largely for the poor and nonwhite. No bankers have been jailed for the 2008 financial crisis despite widespread fraud and the looting of the American economy, which resulted in mass unemployment, homelessness, and economic dislocation.

On a personal level, all of us have to come to terms with the fact that, sooner or later, we will die. And yet today no aspect of human existence, not even the ending of it, is immune to the hegemonic pretensions of neoclassical economic thought. Not only the intellectual poverty, but also the emotional poverty, of what it has to say about death give us little reason to believe that it will be able to face up to the fact of its own mortality. 4.

What imperialists actually wanted was expansion of political power without the foundation of the body politic. Imperialist expansion had been touched off by a curious kind of economic crisis, the overproduction of capital and the emergence of "superfluous" money, the result of oversaving, which could no longer find productive investment within national borders. For the first time, investment of power did not pave the way for investment of money, since uncontrollable investments in distant countries threatened to transform large strata of society into gamblers, to change the whole capitalist economy from a system of production to a system of financial speculation, and to replace the profits of production with profits in commissions. The decade immediately before the imperialist era, the seventies of the last century, witnessed an unparalleled increase in swindles, financial scandals, and gambling in the stock market.

Printing dollars at home means higher inflation in China, higher food prices in Egypt and stock bubbles in Brazil. Printing money means that U.S. debt is devalued so foreign creditors get paid back in cheaper dollars. The devaluation means higher unemployment in developing economies as their exports become more expensive for Americans. The resulting inflation also means higher prices for inputs needed in developing economies like copper, corn, oil and wheat. Foreign countries have begun to fight back against U.S.-caused inflation through subsidies, tariffs and capital controls; the currency war is expanding fast.

The level of economic literacy in the U.S. had been underdeveloped for a long time ... As a teacher, the best situation is when your students want to learn. But if you have an underdeveloped literacy, then your economic analysis is going to be all over the place, particularly in times like now in the middle of a crisis.

Meanwhile, peer-to-peer blockchain networks and cryptocurrencies such as Bitcoin might completely revamp the monetary system, making radical tax reforms inevitable. For example, it might become impossible or irrelevant to calculate and tax incomes in dollars, because most transactions will not involve a clear-cut exchange of national currency, or any currency at all. Governments might therefore need to invent entirely new taxes—perhaps a tax on information (which will be both the most important asset in the economy and the only thing exchanged in numerous transactions). Will the political system manage to deal with the crisis before it runs out of money?

Depressions are indeed one of the states a capitalist economy can fall into. An economic theory that does not incorporate that possibility is as relevant as a theory of biology that excludes the risk of extinctions, a theory of the body that excludes the risk of heart attacks, or a theory of bridge-building that excludes the risk of collapse.

(Basel Accords) to set capital ratios. Under these guidelines, the

These contradictions, of course, lead to explosions, crises, in which momentary suspension of all labour and annihilation of a great part of the capital violently lead it back to the point where it is enabled [to go on] fully employing its productive powers without committing suicide. Yet, these regularly recurring catastrophes lead to their repetition on a higher scale, and finally to its violent overthrow. There are moments in the developed movement of capital which delay this movement other than by crises; such as e.g. the constant devaluation of a part of the existing capital: the transformation of a great part of capital into fixed capital which does not serve as agency of direct production; unproductive waste of a great portion of capital etc.

As recently as the early 1970s, a Republican president - Richard Nixon - was willing to impose wage and price controls to rescue the U.S. economy from crisis, popularizing the notion that “We are all Keynesians now.” But by the 1980s, the battle of ideas waged out of the same Washington think tanks that now deny climate change had successfully managed to equate the very idea of industrial planning with Stalin’s five-year plans. Real capitalists don’t plan, these ideological warriors insisted - they unleash the power of the profit motive and let the market, in its infinite wisdom, create the best possible society for all.

Social democracy as we now know it underwent its moment of speciation when Eduard Bernstein began to question the orthodoxy of revolution. His essential postulate was the absence of crises. The Steven Pinker of socialism, he pointed to the empirical fact that no serious crisis had rocked the capitalist economy for the past two or three decades, which invalidated the Marxian prophecy of a system trending towards collapse. Since it was not prone to malfunctioning, the idea of seizing power, smashing decrepit capitalism and installing a completely different order had become redundant; instead social democracy could continue to grow in strength, extract piecemeal reforms and gradually lift the working class out of the mire. Rosa Luxemburg very famously objected that the crisis tendencies had merely been postponed. In the near future, they would burst forth with even more dreadful violence. Ignoring her prognosis, the social democrats in the making went ahead and presently gave their first demonstration of how they dealt with catastrophe: by expediting it through consent.

Instead, I identify with the millions of working-class white Americans of Scots-Irish descent who have no college degree. To these folks, poverty is the family tradition—their ancestors were day laborers in the Southern slave economy, sharecroppers after that, coal miners after that, and machinists and millworkers during more recent times. Americans call them hillbillies, rednecks, or white trash. I call them neighbors, friends, and family.

we have not done the things that are necessary to lower emissions because those things fundamentally conflict with deregulated capitalism, the reigning ideology for the entire period we have been struggling to find a way out of this crisis. We are stuck because the actions that would give us the best chance of averting catastrophe—and would benefit the vast majority—are extremely threatening to an elite minority that has a stranglehold over our economy, our political process, and most of our major media outlets.

Similarly, when people do fail, this mind-set allows them to look outward. I once ran into an old acquaintance at a Middletown bar who told me that he had recently quit his job because he was sick of waking up early. I later saw him complaining on Facebook about the “Obama economy” and how it had affected his life. I don’t doubt that the Obama economy has affected many, but this man is assuredly not among them. His status in life is directly attributable to the choices he’s made, and his life will improve only through better decisions. But for him to make better choices, he needs to live in an environment that forces him to ask tough questions about himself. There is a cultural movement in the white working class to blame problems on society or the government, and that movement gains adherents by the day. Here

Pope Benedict XVI was the first to predict the crisis in the global financial system… Italian Finance Minister Giulio Tremonti said. “The prediction that an undisciplined economy would collapse by its own rules can be found” in an article written by Cardinal Joseph Ratzinger

We are dealing, then, with an absurdity that is not a quirk or an accident, but is fundamental to our character as people. The split between what we think and what we do is profound. It is not just possible, it is altogether to be expected, that our society would produce conservationists who invest in strip-mining companies, just as it must inevitably produce asthmatic executives whose industries pollute the air and vice-presidents of pesticide corporations whose children are dying of cancer. And these people will tell you that this is the way the "real world" works. The will pride themselves on their sacrifices for "our standard of living." They will call themselves "practical men" and "hardheaded realists." And they will have their justifications in abundance from intellectuals, college professors, clergymen, politicians. The viciousness of a mentality that can look complacently upon disease as "part of the cost" would be obvious to any child. But this is the "realism" of millions of modern adults. There is no use pretending that the contradiction between what we think or say and what we do is a limited phenomenon. There is no group of the extra-intelligent or extra-concerned or extra-virtuous that is exempt. I cannot think of any American whom I know or have heard of, who is not contributing in some way to destruction. The reason is simple: to live undestructively in an economy that is overwhelmingly destructive would require of any one of us, or of any small group of us, a great deal more work than we have yet been able to do. How could we divorce ourselves completely and yet responsibly from the technologies and powers that are destroying our planet? The answer is not yet thinkable, and it will not be thinkable for some time -- even though there are now groups and families and persons everywhere in the country who have begun the labor of thinking it. And so we are by no means divided, or readily divisible, into environmental saints and sinners. But there are legitimate distinctions that need to be made. These are distinctions of degree and of consciousness. Some people are less destructive than others, and some are more conscious of their destructiveness than others. For some, their involvement in pollution, soil depletion, strip-mining, deforestation, industrial and commercial waste is simply a "practical" compromise, a necessary "reality," the price of modern comfort and convenience. For others, this list of involvements is an agenda for thought and work that will produce remedies. People who thus set their lives against destruction have necessarily confronted in themselves the absurdity that they have recognized in their society. They have first observed the tendency of modern organizations to perform in opposition to their stated purposes. They have seen governments that exploit and oppress the people they are sworn to serve and protect, medical procedures that produce ill health, schools that preserve ignorance, methods of transportation that, as Ivan Illich says, have 'created more distances than they... bridge.' And they have seen that these public absurdities are, and can be, no more than the aggregate result of private absurdities; the corruption of community has its source in the corruption of character. This realization has become the typical moral crisis of our time. Once our personal connection to what is wrong becomes clear, then we have to choose: we can go on as before, recognizing our dishonesty and living with it the best we can, or we can begin the effort to change the way we think and live.

Beyond the speculative and often fraudulent froth that characterizes much of neoliberal financial manipulation, there lies a deeper process that entails the springing of ‘the debt trap’ as a primary means of accumulation by dispossession. Crisis creation, management, and manipulation on the world stage has evolved into the fine art of deliberative redistribution of wealth from poor countries to the rich. I documented the impact of Volcker’s interest rate increase on Mexico earlier. While proclaiming its role as a noble leader organizing ‘bail-outs’ to keep global capital accumulation on track, the US paved the way to pillage the Mexican economy. This was what the US Treasury–Wall Street–IMF complex became expert at doing everywhere. Greenspan at the Federal Reserve deployed the same Volcker tactic several times in the 1990s. Debt crises in individual countries, uncommon during the 1960s, became very frequent during the 1980s and 1990s. Hardly any developing country remained untouched, and in some cases, as in Latin America, such crises became endemic. These debt crises were orchestrated, managed, and controlled both to rationalize the system and to redistribute assets. Since 1980, it has been calculated, ‘over fifty Marshall Plans (over $4.6 trillion) have been sent by the peoples at the Periphery to their creditors in the Center’. ‘What a peculiar world’, sighs Stiglitz, ‘in which the poor countries are in effect subsidizing the richest.

It is an obvious fact that the banks and big monopolies are now dependent on the state for their survival. As soon as they were in difficulties, the same people who used to insist that the state must play no role in the economy, ran to the government with their hands out, demanding huge sums of money. And the government immediately gave them a blank cheque. Trillions of pounds of public money has been handed over to the banks, totalling some $14 trillion. But the crisis continues to deepen. All that has been achieved in the last four years is to transform what was a black hole in the finances of the banks into a black hole in public finances. In order to save the bankers, everybody is expected to sacrifice, but for the bankers and capitalists no sacrifices are demanded. They pay themselves lavish bonuses with the money of the taxpayer. This is Robin Hood in reverse.

We live in an industrial world with a globalized capitalist economy organized politically around nation-states. Finding a willing audience for even a mild critique of any of these foundational systems is not easy; suggesting that all three systems should be rethought in fundamental ways seems crazy.

One man’s real estate crisis is another’s opportunity. All markets work in this way, providing investors with cash the chance to buy—stocks, bonds, real estate, and commodities—when prices are depressed. This reality is devoid of emotional weight and is the basic truth that keeps capitalist economies working.

The current coronavirus crisis continues to have a significant impact on the economy, employment, and people’s lives in general. And, as many meetings are now conducted on Zoom, Skype, or some other cloud-based video conferencing service, it is even having a psychological impact for those fortunate enough to be employed.

Scientists seeking extraterrestrial intelligence have been struck by the Fermi paradox: Where are they? Astrophysics suggests that there should be intelligent life elsewhere. Maybe they are right; there really is intelligent life, and when it discovers the strange inhabitants of Planet Earth, it has the sense to stay far away.

From this vantage point, Christianity has nothing—absolutely nothing—to teach Indigenous people about how to live in a good way on this land. In fact, Christians have only demonstrated that there is something profoundly wrong with the cosmology and worldview behind more than five centuries of carnage—carnage that has yet to even slow down. Christians have so much negative history and dogma to overcome within their own tradition, I do not believe the religion is even salvageable. The world is deep in the throes of an ecological crisis based in Western economies of hyper-exploitation. The planet will not survive another 500 years of Christian domination.

This crisis didn’t have to happen. America had a boom-and-bust cycle from the 1790s to the 1930s, with a financial panic every ten to fifteen years. But we figured out how to fix it. Coming out of the Great Depression, the country put tough rules in place that gave us fifty years without a financial crisis. But in the 1980s, we started pulling the threads out of the regulatory fabric, and we found ourselves back in the boom-and-bust cycle. When this crisis is over, there will be a once-in-a-generation chance to rewrite the rules. What we set in place will determine whether our country continues down this path toward a boom-and-bust economy or whether we reestablish an economy with more stability that gives ordinary folks a chance at real prosperity. Done.

The air, soil and water cumulatively degrade; the climates and oceans destabilize; species become extinct at a spasm rate across continents; pollution cycles and volumes increase to endanger life-systems at all levels in cascade effects; a rising half of the world is destitute as inequality multiplies; the global food system produces more and more disabling and contaminated junk food without nutritional value; non-contagious diseases multiply to the world’s biggest killer with only symptom cures; the vocational future of the next generation collapses across the world while their bank debts rise; the global financial system has ceased to function for productive investment in life-goods; collective-interest agencies of governments and unions are stripped while for-profit state subsidies multiply; police state laws and methods advance while belligerent wars for corporate resources increase; the media are corporate ad vehicles and the academy is increasingly reduced to corporate functions; public sectors and services are non-stop defunded and privatized as tax evasion and transnational corporate funding and service by governments rise at the same time at every level.

Over the last few years, banks and governments have been frenziedly printing money. Everybody is terrified that the current economic crisis may stop the growth of the economy. So they are creating trillions of dollars, euros and yen out of thin air, pumping cheap credit into the system, and hoping that the scientists, technicians and engineers will manage to come up with something really big,

Isabel, remember we used to talk about a honeymoon in Spain?" "Of course." "It woulda been a blast. I took a walk last night. Two in the morning, it felt like two in the afternoon. Traffic. People on the street: families, old folks on benches. The bars and restaurants were full, everybody carrying on. Hard to believe there's an economic crisis." "Maybe they should shut up, get some sleep, and fix the mess.

There is an ethnic component lurking in the background of my story. In our race-conscious society, our vocabulary often extends no further than the color of someone's skin - black people, Asians, white privilege. Sometimes these broad categories are useful. But to understand my story, you have to delve into the details.I may be white, but I do not identify with the WASPs of the Northeast. Instead, I identify with the millions of working-class white Americans of Scots-Irish descent who have no college degree. To these folks, poverty's the family tradition. Their ancestors were day laborers in the southern slave economy, sharecroppers after that, coal miners after that, and machinists and mill workers during more recent times. Americans call them hillbillies, rednecks or white trash. I call them neighbors, friends and family.

Over the last few years, banks and governments have been frenziedly printing money. Everybody is terrified that the current economic crisis may stop the growth of the economy. So they are creating trillions of dollars, euros and yen out of thin air, pumping cheap credit into the system, and hoping that the scientists, technicians and engineers will manage to come up with something really big, before the bubble bursts. Everything

Encouraging consumers to think more seriously about the financial, environmental, and personal costs of their consumption would be a major step in addressing the crisis of quality and the environmental and social impacts of too much stuff. Better yet, it would spur businesses to seek economic incentives to design and market better products. Today's secondhand economy, faltering in search of quality, should have more than it can handle.

What, in fact, do we know about the peak experience? Well, to begin with, we know one thing that puts us several steps ahead of the most penetrating thinkers of the 19th century: that P.E’.s are not a matter of pure good luck or grace. They don’t come and go as they please, leaving ‘this dim, vast vale of tears vacant and desolate’. Like rainbows, peak experiences are governed by definite laws. They are ‘intentional’. And that statement suddenly gains in significance when we remember Thorndike’s discovery that the effect of positive stimuli is far more powerful and far reaching than that of negative stimuli. His first statement of the law of effect was simply that situations that elicit positive reactions tend to produce continuance of positive reactions, while situations that elicit negative or avoidance reactions tend to produce continuance of these. It was later that he came to realise that positive reactions build-up stronger response patterns than negative ones. In other words, positive responses are more intentional than negative ones. Which is another way of saying that if you want a positive reaction (or a peak experience), your best chance of obtaining it is by putting yourself into an active, purposive frame of mind. The opposite of the peak experience—sudden depression, fatigue, even the ‘panic fear’ that swept William James to the edge of insanity—is the outcome of passivity. This cannot be overemphasised. Depression—or neurosis—need not have a positive cause (childhood traumas, etc.). It is the natural outcome of negative passivity. The peak experience is the outcome of an intentional attitude. ‘Feedback’ from my activities depends upon the degree of deliberately calculated purpose I put into them, not upon some occult law connected with the activity itself. . . . A healthy, perfectly adjusted human being would slide smoothly into gear, perform whatever has to be done with perfect economy of energy, then recover lost energy in a state of serene relaxation. Most human beings are not healthy or well adjusted. Their activity is full of strain and nervous tension, and their relaxation hovers on the edge of anxiety. They fail to put enough effort—enough seriousness—into their activity, and they fail to withdraw enough effort from their relaxation. Moods of serenity descend upon them—if at all—by chance; perhaps after some crisis, or in peaceful surroundings with pleasant associations. Their main trouble is that they have no idea of what can be achieved by a certain kind of mental effort. And this is perhaps the place to point out that although mystical contemplation is as old as religion, it is only in the past two centuries that it has played a major role in European culture. It was the group of writers we call the romantics who discovered that a man contemplating a waterfall or a mountain peak can suddenly feel ‘godlike’, as if the soul had expanded. The world is seen from a ‘bird’s eye view’ instead of a worm’s eye view: there is a sense of power, detachment, serenity. The romantics—Blake, Wordsworth, Byron, Goethe, Schiller—were the first to raise the question of whether there are ‘higher ceilings of human nature’. But, lacking the concepts for analysing the problem, they left it unsolved. And the romantics in general accepted that the ‘godlike moments’ cannot be sustained, and certainly cannot be re-created at will. This produced the climate of despair that has continued down to our own time. (The major writers of the 20th century—Proust, Eliot, Joyce, Musil—are direct descendants of the romantics, as Edmund Wilson pointed out in Axel’s Castle.) Thus it can be seen that Maslow’s importance extends far beyond the field of psychology. William James had asserted that ‘mystical’ experiences are not mystical at all, but are a perfectly normal potential of human consciousness; but there is no mention of such experiences in Principles of Psychology (or only in passing).

On this view, God is the cause of physical evil. The question arose, then, whether He is also the cause of sin and of moral evil; and, if so, how He could have invented the very thing that corrupts His creation. The attempt to vindicate God's will was called theodicy in Greek, and it is this term that is traditionally used to refer to all human attempts to justify the existence of evil in a world that has been perfectly made. Theodicies

History will see this as the residential commodification era, in which housing provision seemed to lose all contact between supply and demand of housing as a utility and simply focused on supply and demand of investment — and that is worrying. Investment is good for the economy, but the investment you want is investment that goes into creating homes, workplaces and infrastructure, not investing in owning them and inflating asset prices.

Many intelligent and well-informed people were keenly interested in the future of the economy and did not believe a catastrophe was imminent; I infer from this fact that the crisis was not knowable. What is perverse about the use of know in this context is not that some individuals get credit for prescience that they do not deserve. It is that the language implies that the world is more knowable than it is. It helps perpetuate a pernicious illusion.

Over the last few years, banks and governments have been frenziedly printing money. Everybody is terrified that the current economic crisis may stop the growth of the economy. So they are creating trillions of dollars, euros and yen out of thin air, pumping cheap credit into the system, and hoping that the scientists, technicians and engineers will manage to come up with something really big, before the bubble bursts. Everything depends on the people in the labs.

The economy — and the need to keep it strong and growing — has somehow become the most important aspect of modern life. Nothing else is allowed to rank higher. The economy is suffering; the economy is improving; the economy is stable or unstable — you’d think it was a patient on life support in an intensive-care unit from the way we anxiously await the next pronouncement on its health. But what we call the economy is nothing more than people producing, consuming and exchanging things and services.

we are left with a stark choice: allow climate disruption to change everything about our world, or change pretty much everything about our economy to avoid that fate. But we need to be very clear: because of our decades of collective denial, no gradual, incremental options are now available to us. ”(…) That’s tough for a lot of people in important positions to accept, since it challenges something that might be even more powerful than capitalism, and that is the fetish of centrism—of reasonableness, seriousness, splitting the difference, and generally not getting overly excited about anything. This is the habit of thought that truly rules our era, far more among the liberals who concern themselves with matters of climate policy than among conservatives, many of whom simply deny the existence of the crisis. Climate change presents a profound challenge to this cautious centrism because half measures won’t cut it. (…) The challenge, then, is not simply that we need to spend a lot of money and change a lot of policies; it’s that we need to think differently, radically differently, for those changes to be remotely possible. Right now, the triumph of market logic, with its ethos of domination and fierce competition, is paralyzing almost all serious efforts to respond to climate change. (…) It seems to me that our problem has a lot less to do with the mechanics of solar power than the politics of human power—specifically whether there can be a shift in who wields it, a shift away from corporations and toward communities,

Neoliberalism is a driving force causing the climate crisis. This is because neoliberalism is a variant of classic liberalism, and classical liberalism builds from the idea that everyone should be granted maximum freedom to pursue their self-interest within capitalist market settings. But neoliberalism also diverges substantially from classical liberalism, and therefore also from the basic premises of orthodox economics that free markets, left to their own devices, will produce outcomes that are superior to government interventions. Here is the problem with neoliberalism, when counterposed against a purely free market model celebrated by economic orthodoxy. That is, what really occurs in practice under neoliberalism is that governments allow giant corporations to freely pursue profit opportunities to the maximum extent. But then government fixers arrive on the scene to bail out the corporations whenever their profits might be threatened. This amounts to socialism for capitalists, and harsh, free market capitalism for everyone else.

These findings on capital flow bonanzas are also consistent with other identified empirical regularities surrounding credit cycles. Mendoza and Terrones, who examine credit cycles in both advanced and emerging market economies using a very different approach from that just discussed, find that credit booms in emerging market economies are often preceded by surges in capital inflows. They also conclude that, although not all credit booms end in financial crisis, most emerging market crises were preceded by credit booms.

All of the solutions to our growth-based problems involve some form of self-restraint. That’s why most of those solutions remain just good ideas. That’s also why we will probably hit the wall, and why the outcomes described in the previous chapters of this book are likely. The sustainability revolution will occur. The depletion of nonrenewable resources ensures that humankind will eventually base its economy on renewable resources harvested at rates of natural replenishment. But that revolution will be driven by crisis.

Some estimate that the challenge, while immense, does not impose burdens comparable to those of 1941. Economist Jeffrey Sachs, in a careful study, concludes that 'contrary to some commentaries, decarbonization will not require grand mobilization of the U.S. economy on par with World War II. The incremental costs of decarbonization above our normal energy costs will amount to 1 to 2 percent of U.S. GDP per year during the period to 2050. By contrast, during World War II, federal outlays soared to 43 percent of GDP from the prewar level of 10 percent of GDP in 1940.

SUSAN’S STORY OF cascading loss and downward mobility has been replicated millions of times across the American landscape due to the financial industry’s actions in the 2000s. While the country’s GDP and employment numbers rebounded before the pandemic struck another blow, the damage at the household level has been permanent. Of families who lost their houses through dire events such as job loss or foreclosure, over two-thirds will probably never own a home again. Because of our globally interconnected economy, the Great Recession altered lives in every country in the world. And all of it was preventable, if only we had paid attention earlier to the financial fires burning through Black and brown communities across the nation. Instead, the predatory practices were allowed to continue until the disaster had engulfed white communities, too—and only then, far too late, was it recognized as an emergency. There is no question that the financial crisis hurt people of color first and worst. And yet the majority of the people it damaged were white. This is the dynamic we’ve seen over and over again throughout our country’s history,

In the mid-1980s, Congress authorized the creation of the US Sentencing Commission to examine prison terms and codify norms to correct the arbitrary punishments meted out by unaccountable judges. First, in 1989 the commission’s guidelines for individuals went into effect, establishing a point system for how many years of prison a convicted criminal might get, based on the seriousness of the misconduct and a person’s criminal history. In 1991, amid public and congressional outrage that sentences for white-collar criminals were too light and fines and sanctions for corporations too lenient, the Sentencing Commission expanded the concept to cover organizations. It formalized the Sporkin-era regime of offering leniency in exchange for cooperation and reform. The new rules delineated factors that could earn a culprit mercy. In levying a fine, the court should consider, the sentencing guidelines said, “any collateral consequences of conviction.” 1 “Collateral consequences” was, and remains, an ill-defined concept. How worried should the government be if a punishment causes a company to go out of business? Should regulators worry about the cashiering of innocent employees? What about customers, suppliers, or competitors? Should they fret about financial crises? From this rather innocuous mention, the little notion of collateral consequences would blossom into the great strangling vine that came to be known after the financial crisis of 2008 by its shorthand: “too big to jail.” Prosecutors and regulators were crippled by the idea that the government could not criminally sanction some companies—particularly giant banks—for fear that they would collapse, causing serious problems for financial markets or the economy.

This isn’t some libertarian mistrust of government policy, which is healthy in any democracy. This is deep skepticism of the very institutions of our society. And it’s becoming more and more mainstream. We can’t trust the evening news. We can’t trust our politicians. Our universities, the gateway to a better life, are rigged against us. We can’t get jobs. You can’t believe these things and participate meaningfully in society. Social psychologists have shown that group belief is a powerful motivator in performance. When groups perceive that it’s in their interest to work hard and achieve things, members of that group outperform other similarly situated individuals. It’s obvious why: If you believe that hard work pays off, then you work hard; if you think it’s hard to get ahead even when you try, then why try at all? Similarly, when people do fail, this mind-set allows them to look outward. I once ran into an old acquaintance at a Middletown bar who told me that he had recently quit his job because he was sick of waking up early. I later saw him complaining on Facebook about the “Obama economy” and how it had affected his life. I don’t doubt that the Obama economy has affected many, but this man is assuredly not among them. His status in life is directly attributable to the choices he’s made, and his life will improve only through better decisions. But for him to make better choices, he needs to live in an environment that forces him to ask tough questions about himself. There is a cultural movement in the white working class to blame problems on society or the government, and that movement gains adherents by the day. Here is where the rhetoric of modern conservatives (and I say this as one of them) fails to meet the real challenges of their biggest constituents. Instead of encouraging engagement, conservatives increasingly foment the kind of detachment that has sapped the ambition of so many of my peers. I have watched some friends blossom into successful adults and others fall victim to the worst of Middletown’s temptations—premature parenthood, drugs, incarceration. What separates the successful from the unsuccessful are the expectations that they had for their own lives. Yet the message of the right is increasingly: It’s not your fault that you’re a loser; it’s the government’s fault. My dad, for example, has never disparaged hard work, but he mistrusts some of the most obvious paths to upward mobility. When

possibility is that the crisis happened partly because the economic models of the mainstream rendered that outcome ostensibly so unlikely in theory that they ended up making it far more likely in practice. The insouciance encouraged by the rational-expectations and efficient-market hypotheses made regulators and investors careless. As Minsky argued, stability destabilizes. This is an aspect of what George Soros, the successful speculator and innovative economic thinker, calls ‘reflexivity’: the way human beings think determines the reality in which they live.5 Naive economics helps cause unstable economies. Meanwhile,

We saw that four different voices respond to this crisis by suggesting differing pathways forward: the first three are the retro-voices, which suggest returning to the global field structure of Field 1 (autocratic and state-driven: regulation, law and order), Field 2 (market-driven: deregulation), or Field 3 (stakeholder negotiation-driven: dialogue), respectively. The fourth voice, however, suggests that there is no way back. Retreat is impossible because circumstances have changed. This is why we need to go forward to the next evolutionary stage of the global economy (ecosystem-driven: seeing and acting from the emerging whole).

The godfather’s name is Saul Alinsky. His most famous students are Barack Obama and Hillary Clinton. Hardly anyone recognizes this, but Alinsky and the Alinsky method is the hidden force behind the 2008 economic meltdown. The meltdown was the worst economic crisis since the Great Depression; it was the main cause of median wealth in the United States in the subsequent three years declining nearly 40 percent. While the meltdown is routinely attributed to Wall Street “greed,” its real cause was government and activist pressure on banks and banking agencies—like Fannie Mae and Freddie Mac—to change their lending and loan guarantee practices. Yes, the 2008 crash was actually the result of an Alinskyite scam—actually a series of Alinskyite scams, carried out over many years. Basically the Alinskyites were trying to steal money from the banks and, in the process, force the banks to make loans to people that they had no intention of making loans to. The banks acquiesced, and eventually the whole scheme came crashing down. It was toppled not by greed but by the sober reality that when you loan money to millions of people who cannot afford to pay, those people are very likely to default on those loans. That’s how Alinskyites almost destroyed the U.S. economy a few years ago. If Alinsky had never lived, none of this would have happened.

Obama occasionally pointed out that the post–Cold War moment was always going to be transitory. The rest of the world will accede to American leadership, but not dominance. I remember a snippet from a column around 9/11: America bestrides the world like a colossus. Did we? It was a story we told ourselves. Shock and awe. Regime change. Freedom on the march. A trillion dollars later, we couldn’t keep the electricity running in Baghdad. The Iraq War disturbed other countries—including U.S. allies—in its illogic and destruction, and accelerated a realignment of power and influence that was further advanced by the global financial crisis. By the time Obama took office, a global correction had already taken place. Russia was resisting American influence. China was throwing its weight around. Europeans were untangling a crisis in the Eurozone. Obama didn’t want to disengage from the world; he wanted to engage more. By limiting our military involvement in the Middle East, we’d be in a better position to husband our own resources and assert ourselves in more places, on more issues. To rebuild our economy at home. To help shape the future of the Asia Pacific and manage China’s rise. To open up places like Cuba and expand American influence in Africa and Latin America. To mobilize the world to deal with truly existential threats such as climate change, which is almost never discussed in debates about American national security.

Temperatures, petrol prices, the price of the dollar: the golden triangle of our summer. These are facts beyond our control and all we hope now is to see them all rising indefinitely. Sometimes the figures are mixed up in a prophetic confusion, as in 1980 in the US deserts. There, the price per gallon: 51.18, 51.20, 51 .25, varied from one place to another as an exact reflection of the temperature graphs: 100, 110 and 120 degrees Fahrenheit. With the question of confidence always lurking just beneath the surface: what price would you accept petrol rising to? What point do you think the dollar could go up to (with the implication: before causing a crash in world economies)? What record level can the heat reach (before causing a volatilization of energy and the beginnings of a worldwide insomnia)? Our artificial destiny is written in these asymptotic curves.

Understanding the narcissism epidemic is important because its long-term consequences are destructive to society. American culture’s focus on self-admiration has caused a flight from reality to the land of grandiose fantasy. We have phony rich people (with interest-only mortgages and piles of debt), phony beauty (with plastic surgery and cosmetic procedures), phony athletes (with performance-enhancing drugs), phony celebrities (via reality TV and YouTube), phony genius students (with grade inflation), a phony national economy (with $11 trillion of government debt), phony feelings of being special among children (with parenting and education focused on self-esteem), and phony friends (with the social networking explosion). All this fantasy might feel good, but unfortunately, reality always wins. The mortgage meltdown and the resulting financial crisis are just one demonstration of how inflated desires eventually crash to earth.

The situation—having to choose between imposing higher retail prices and reducing investments and military spending—created a dilemma for the government: deciding between conflict with the public or with the Party economic elite. But not making a decision heightened the risk that, as the crisis developed, there would be conflict with both the public and the elite.18 The new generation of leaders clearly did not understand this. The traditional management of the economy was oriented on natural, rather than abstract, parameters. The development of cattle breeding was discussed at the highest level more frequently than the country’s budget. Industry and business leaders regarded finances as necessary but dreary bookkeeping.19 In addition, information on the real state of the budget, hard currency reserves, foreign debt, and balance of payments was available only to an extremely narrow circle of people, many of whom understood nothing about it anyway.

The Troika sought to undo the steep pay raises civil servants had received in the decade preceding the crisis, and Greek government workers saw their paychecks cut by as much as 35 percent. This was intended not only to reduce the government’s wage bill, but to make the Greek economy more competitive. Since public wage levels have a direct effect on private wages, a reduction in the former would result in a cheaper overall labor force, allowing Greece to export products at more competitive prices, the thinking went. Or as I heard some Greeks put it, the plan was to make wages as low as in China, so that Greeks, too, would one day supplicate for jobs assembling iPads until their fingers went numb. The Troika’s plan certainly seemed to work, as average incomes in Greece fell about one-quarter in the years following the outbreak of the crisis. It was not clear, however, that the Greek government would be able to sustain all the public wage cuts it had been forced to implement.

The current crisis has led to renewed discussions about a universal basic income, whereby all citizens receive an equal regular payment from the government, regardless of whether they work. The idea behind this policy is a good one, but the narrative would be problematic. Since a universal basic income is seen as a handout, it perpetuates the false notion that the private sector is the sole creator, not a co-creator, of wealth in the economy and that the public sector is merely a toll collector, siphoning off profits and distributing them as charity. A better alternative is a citizen’s dividend. Under this policy, the government takes a percentage of the wealth created with government investments, puts that money in a fund, and then shares the proceeds with the people. The idea is to directly reward citizens with a share of the wealth they have created. Alaska, for example, has distributed oil revenues to residents through an annual dividend from its Permanent Fund since 1982.

There is an excellent short book (126 pages) by Faustino Ballvè, Essentials of Economics (Irvington-on-Hudson, N.Y.: Foundation for Economic Education), which briefly summarizes principles and policies. A book that does that at somewhat greater length (327 pages) is Understanding the Dollar Crisis by Percy L. Greaves (Belmont, Mass.: Western Islands, 1973). Bettina Bien Greaves has assembled two volumes of readings on Free Market Economics (Foundation for Economic Education). The reader who aims at a thorough understanding, and feels prepared for it, should next read Human Action by Ludwig von Mises (Chicago: Contemporary Books, 1949, 1966, 907 pages). This book extended the logical unity and precision of economics beyond that of any previous work. A two-volume work written thirteen years after Human Action by a student of Mises is Murray N. Rothbard’s Man, Economy, and State (Mission, Kan.: Sheed, Andrews and McMeel, 1962, 987 pages). This contains much original and penetrating material; its exposition is admirably lucid; and its arrangement makes it in some respects more suitable for textbook use than Mises’ great work. Short books that discuss special economic subjects in a simple way are Planning for Freedom by Ludwig von Mises (South Holland, 111.: Libertarian Press, 1952), and Capitalism and Freedom by Milton Friedman (Chicago: University of Chicago Press, 1962). There is an excellent pamphlet by Murray N. Rothbard, What Has Government Done to Our Money? (Santa Ana, Calif.: Rampart College, 1964, 1974, 62 pages). On the urgent subject of inflation, a book by the present author has recently been published, The Inflation Crisis, and How to Resolve It (New Rochelle, N.Y.: Arlington House, 1978). Among recent works which discuss current ideologies and developments from a point of view similar to that of this volume are the present author’s The Failure of the “New Economics”: An Analysis of the Keynesian Fallacies (Arlington House, 1959); F. A. Hayek, The Road to Serfdom (1945) and the same author’s monumental Constitution of Liberty (Chicago: University of Chicago Press, 1960). Ludwig von Mises’ Socialism: An Economic and Sociological Analysis (London: Jonathan Cape, 1936, 1969) is the most thorough and devastating critique of collectivistic doctrines ever written. The reader should not overlook, of course, Frederic Bastiat’s Economic Sophisms (ca. 1844), and particularly his essay on “What Is Seen and What Is Not Seen.” Those who are interested in working through the economic classics might find it most profitable to do this in the reverse of their historical order. Presented in this order, the chief works to be consulted, with the dates of their first editions, are: Philip Wicksteed, The Common Sense of Political Economy, 1911; John Bates Clark, The Distribution of Wealth, 1899; Eugen von Böhm-Bawerk, The Positive Theory of Capital, 1888; Karl Menger, Principles of Economics, 1871; W. Stanley Jevons, The Theory of Political Economy, 1871; John Stuart Mill, Principles of Political Economy, 1848; David Ricardo, Principles of Political Economy and Taxation, 1817; and Adam Smith, The Wealth of Nations, 1776.

The proletariat has not succeeded in negating itself as such - the century and a half since Marx has made that clear. The proletariat has failed to negate itself qua class and thereby abolish class society per se. Perhaps this is because the proletariat never was a class, as had been supposed - because only the bourgeoisie was a true Class, and therefore the only one capable of negating itself as such. For it has indeed negated itself, along with capital, and so generated a classless society, albeit one which has nothing to do with the classless society that was supposed to arise from a revolution and from a negation of the proletariat as such. As for the proletariat, it has simply disappeared - vanished along with the class struggle itself. There can be no doubt that had capitalism developed in accordance with its own contradictory logic, it would have been defeated by the proletariat. In an ideal sense, Marx's analysis is still irreproachable. But Marx simply did not foresee that it would be possible for capital, in the face of the imminent threat to its existence, to transpoliticize itself, as it were: to launch itself into an orbit beyond the relations of production and political contradictions, to make itself autonomous in a free-floating, ecstatic and haphazard form, and thus to totalize the world in its own image. Capital (if it may still be so called) has barred the way of political economy and the law of value; it is in this sense that it has successfully escaped its own end. Henceforward it can function independently of its own former aims, and absolutely without reference to any aims whatsoever. The inaugural event of this mutation was undoubtedly the Great Crash of 1929; the stockmarket crisis of 1987 was merely an aftershock.

KEYNESIAN ECONOMICS AND STIMULUS Keynesian economics is based on the notion that unemployment arises when total or aggregate demand in an economy falls short of the economy’s ability to supply goods and services. When products go unsold, jobs are lost. Aggregate demand, in turn, comes from two sources: the private sector (which is the majority) and the government. At times, aggregate demand is too buoyant—goods fly off the shelves and labor is in great demand—and we get rising inflation. At other times, aggregate demand is inadequate—goods are hard to sell and jobs are hard to find. In those cases, Keynes argued in the 1930s, governments can boost employment by cutting interest rates (what we now call looser monetary policy), raising their own spending, or cutting people’s taxes (what we now call looser fiscal policy). By the same logic, when there is too much demand, governments can fight actual or incipient inflation by raising interest rates (tightening monetary policy), increasing taxes, or reducing its own spending (thus tightening fiscal policy). That’s part of standard Keynesian economics, too, although Keynes, writing during the Great Depression, did not emphasize it. Setting aside the underlying theory, the central Keynesian policy idea is that the government can—and, Keynes argued, should—act as a kind of balance wheel, stimulating aggregate demand when it’s too weak and restraining aggregate demand when it’s too strong. For decades, American economists took for granted that most of that job should and would be done by monetary policy. Fiscal policy, they thought, was too slow, too cumbersome, and too political. And in the months after the Lehman Brothers failure, the Federal Reserve did, indeed, pull out all the stops—while fiscal policy did nothing. But what happens when, as was more or less the case by December 2008, the central bank has done almost everything it can, and yet the economy is still sinking? That’s why eyes started turning toward Congress and the president—that is, toward fiscal stimulus—after the 2008 election.

...the centrality of competitiveness as the key to growth is a recurrent EU motif. Two decades of EC directives on increasing competition in every area, from telecommunications to power generation to collateralizing wholesale funding markets for banks, all bear the same ordoliberal imprint. Similarly, the consistent focus on the periphery states’ loss of competitiveness and the need for deep wage and cost reductions therein, while the role of surplus countries in generating the crisis is utterly ignored, speaks to a deeply ordoliberal understanding of economic management. Savers, after all, cannot be sinners. Similarly, the most recent German innovation of a constitutional debt brake (Schuldenbremse) for all EU countries regardless of their business cycles or structural positions, coupled with a new rules-based fiscal treaty as the solution to the crisis, is simply an ever-tighter ordo by another name. If states have broken the rules, the only possible policy is a diet of strict austerity to bring them back into conformity with the rules, plus automatic sanctions for those who cannot stay within the rules. There are no fallacies of composition, only good and bad policies. And since states, from an ordoliberal viewpoint, cannot be relied upon to provide the necessary austerity because they are prone to capture, we must have rules and an independent monetary authority to ensure that states conform to the ordo imperative; hence, the ECB. Then, and only then, will growth return. In the case of Greece and Italy in 2011, if that meant deposing a few democratically elected governments, then so be it. The most remarkable thing about this ordoliberalization of Europe is how it replicates the same error often attributed to the Anglo-American economies: the insistence that all developing states follow their liberal instruction sheets to get rich, the so-called Washington Consensus approach to development that we shall discuss shortly. The basic objection made by late-developing states, such as the countries of East Asia, to the Washington Consensus/Anglo-American idea “liberalize and then growth follows” was twofold. First, this understanding mistakes the outcomes of growth, stable public finances, low inflation, cost competitiveness, and so on, for the causes of growth. Second, the liberal path to growth only makes sense if you are an early developer, since you have no competitors—pace the United Kingdom in the eighteenth century and the United States in the nineteenth century. Yet in the contemporary world, development is almost always state led.