Most mornings I wake, begin reading, and the theme of the central blog of the day becomes apparent quite quickly. News and comment posts apart, there is also usually an issue that seems worthy of a bit more development. Mostly I hope that is in an overall positive direction, whatever criticism might be thrown in on the way.
Today, like a number of late, it is quite hard to identify a positive theme. What strikes me, overwhelmingly, is the sense of chaos that surrounds us.
Stock markets have been turbulent. I stick to the fact that they are fundamentally over valued, but there was a rebound in the US last night as the impact of what were, quite literally, gambles on the VIX trading volume index began to unwind. What could be more chaotic, or destructive, than markets that are supposedly core to capitalism in turmoil because of the impact of bets made on the behaviour of participants in the market itself rather than anything fundamental?
Some property markets are turbulent. Developers have gambled on there being seemingly unlimited demand for flats in London costing more than £1 million. Oversupply will be killing that golden goose.
Politics is in turmoil. At a national level that is because a commitment to leave all customs unions means that Ireland is to be torn apart, with worse to follow.
At a party level we see a small minority in one party seeking to govern the country from the back benches at enormous cost to the country as a whole.
Meanwhile the business model of three decades, where expansion of the private sector has been heavily dependent not on innovation but on privatisation and then outsourcing is collapsing. The failure of the East Coast mainline and the failures of Carillion, Capita and care home providers all suggest both models are failing.
Brexit will also tear great swathes of business apart. Even if business could adapt to the regulatory demands of not being in the single market (and for many that will be hard) there will be many in manufacturing that will go to the wall anyway as they cannot participate in lengthened supply chains or afford the additional working capital that this will require. It's almost impossible to overstate the threat to British business that Brexit creates.
And public services are failing. The NHS, education, the justice system, the police, social care and other essential services have reached the point where it is hard to know where the breaking points will be and yet it is obvious they are arriving, as Northamptonshire Council has proven.
What we have is chaos. Now don't get me wrong: I like, embrace and positively encourage processes of change with all the disruption that goes with them. This I enjoy, and I think both beneficial and essential for vibrant societies. Chaos though is something quite different. It is about collapsing order. And that appears to be what we are suffering.
I strongly suspect that the likes of Jacob Rees-Mogg would think that a descent into hell is the necessary pre-condition for the rising of the new free market world for which he craves. The difficulty for everyone else is that it is glaringly obviously the case that it is the drive for a supposed free market that is creating the chaos. This is, of course, inevitable when a process of change is driven by those with a contempt for the essential governance structures that actually underpin the system they claim to believe in. This is what is happening here: markets can only survive if good ordering based on sound regulation, strong government, and cooperation exists. Those supporting Brexit seemingly wish to destroy all three.
This chaos, then, is not by chance. It represents the current success of an ideology dedicated to destroying the foundations of the very system it promotes, without which foundations the markets they desire cannot survive. This is indeed chaos in action. And if they succeed the prospects are profoundly unattractive.
Thanks for reading this post.
You can share this post on social media of your choice by clicking these icons:
You can subscribe to this blog's daily email here.
And if you would like to support this blog you can, here:
One outcome might be that, witnessing the chaos our supposed representatives have bought us to, people taking their voting a bit more seriously from now on. Another, if there’s social breakdown on any scale, might be people, grasping their vulnerabilities in this regard, seek to achieve domestic autarky, and stop being dependent upon outside third parties for their power, water, clothing and food.
But, apart from that Mrs Lincoln….
As an ex-biologist, I suggest that the best model for free market is cancer. Cancer is the inevitable consequence of the free market between our cells. We survive for 60 or 70 years without cancer, because our bodies are a highly regulated socialist economy.
🙂
It’s a Gramscian moment which could be the precursor of either more or less democracy. Is it a 1930s redux? It’s not a huge step from our prevailing Oligarchy to Fascism. As FDR said “The liberty of a democracy is not safe if the people tolerated the growth of private power to a point where it becomes stronger than the democratic state itself. That in its essence is fascism: ownership of government by an individual, by a group, or any controlling private power.”
I think there’s a complacency – even naivety – in UK. Having defeated the Fascist tendency prior to WW2, we like to think we’re immune to its threats. Across the Pond luminaries like Noam Chomsky, Bernie Sanders, Naomi Klein and Chris Hedges speak to groups across the country warning people of the imminent danger. It seems we have no equivalent.
If anyone has doubts about the real threat to our freedoms, just check out any of Chris Hedges many speeches & interviews on YouTube. He is the winner of a Pulitzer Prize, a professor at Princeton, articulate, rational and extraordinarily experienced – having been on the front-line in war zones for 20 years. Here’s a link to a recent one from November 10 last year – https://www.youtube.com/watch?v=BMYjroVIDLA.
Of course there are intrinsic differences between the UK and the USA. However the threat is from global capitalism, so we cannot be immune. The political presence of people like Rees-Mogg, BoJo and Farage should be a wake-up call for any rational person. I don’t know about you and others here, but I’m deeply concerned for the future safety of our country. As Chris Hedges has said about Trump: he’s not the disease but the symptom.
I agree with all that
It’s been a recurring theme for a long time
It was a reason why John Christensen and I began tax justice campaigning
” Is it a 1930s redux?”
Pretty much, yes.
I have been saying for years that, if the 2007 financial crisis was the 1929 crash of our times, then what follows could well be the modern version of the 1930s.
We seem to have managed to avoid a world war, but authoritarianism is on the rise around the world. Rule of law, freedom of speech, freedom of religion, all under threat or absent, and not just in places like Russia or Burma, but also places like Poland, for example, or the Philippines. When things are bad, people look for a strong leader with easy answers (even if they are false). The difference between the US and the UK is that that leader has not emerged. Yet. And that is the danger.
There is a decent chance that this ramshackle minority government could collapse this year, and another general election.
It is obvious to almost everyone that the present situation of inequality in the UK is unsustainable if the UK is to remain a modern democracy. What encourages me is that there are more and more people suggesting ways to tackle the rampant inequality and revive our democracy. But there is another, darker way to a different equilibrium. As they say, the price of freedom is eternal vigilance.
Andrew says, “There is a decent chance that this ramshackle minority government could collapse this year,” Come now, let’s not be so charitable. It’s highly likely the Brexit talks will implode and the govt will collapse either this or next week 🙂
Andrew says:
“….We seem to have managed to avoid a world war, ….”
Not yet we haven’t.
The Donald wants to have a big military victory parade. He wants to do public spectacle ostentatious willy waving (or so they were saying on PM before I got bored and turned the radio off). Twat.
I’m a little surprised by how little comment has been made so far on this post – I wonder if it’s because it’s so difficult to see a way out of this accelerating national collapse?
Robert Pennington says:
” I wonder if it’s because it’s so difficult to see a way out of this accelerating national collapse? ”
I think it might be that most of the contributors are just weary of being able to see a way out, but unable to precipitate the fall of a purblind government which seems content with the way thing are.
Since you’re talking about chaos. I read a couple of interesting articles about Rees-Mogg, Farage, and Cambridge Analytica, who as you may have read Carol Cadwalladr’s articles, appear to be closely connected with Russian destabilisation of Western democracies. There seems to be a very tangled web connecting some very wealthy people and the chaos we are now seeing.
https://www.byline.com/column/67/article/1892
https://www.byline.com/column/67/article/1777
Of course it could all just be speculation and wildly inaccurate. But somehow I don’t think so.
I am not sure that drawing enormous attention to yourself is a great destabilisation tactic. It looks like they’ve failed Covert Activities 101.
Claire is right – They have actually succeeded in drawing next no attention to themselves. Unlike in the USA where leading newspapers have been on Trumps case, in the UK the media have been silent. They have been protected by the Telegraph, Mail et al who, like Trumps team do not want to see their success undermined. The BBC have been pretty much silent. It’s been left to Carole Cadwalladr in the Guardian and Byline to doggedly pursue this.
Meanwhile Corbyn’s team are happy to go with the flow, and will end up equally guilty. But then I fear that there is still a lurking affection for the old GDR amongst Milne and co so they are reluctant to see anything bad coming from behind the old Iron Curtain
“they are reluctant to see anything bad coming from behind the old Iron Curtain”
That is sooo 1986. Labour seem to be delegating it all to Ben Bradshaw which is pretty weak but, they are not stopping him.
Every Remainer in the UK knows about the dodgy Russian Connection. The reasons that its not as big a deal in the UK may be that:
1. We know that Matthew Elliott, Aaron Banks etc. spent a lot of time with the Russians but not what came of it, not specifcally, not exactly. In the US they had evidence, Assange, FBI lots of stuff to go on and all the top level. In the UK, the Boris Johnson link would need to be more solid to get a US style scandal going. So everyone knows about it (the Guardian is in the top 4 papers, so is the
Daily Mirror). Its not doing those involved with the Russians any good but there’s nothing much that’s official.
That said, I did recently write in this forum saying that I didn’t know why Labour and Remainers hadn’t made more out of this issue – but, for you to say that:
Those involved with the Russians “have actually succeeded in drawing next no attention to themselves” That’s just wrong.
2. The General Election. If the Russians were working for the Tories there then they’ve got some explaining to do. The loss of HoC majority for the Tories and Labour’s surge in vote share has inadvertently created some complacency around this issue as the attention has since drifted to Europe, the negotiations and divisions in the Tory party.
As for this: “The BBC have been pretty much silent. ”
I type: ‘BBC Brexit Russia’ into Google and get this on the first page. Nearly all of it is from the last 2months:
http://www.bbc.com/news/uk-politics-42719027
http://www.bbc.co.uk/news/uk-politics-42450479
http://www.bbc.co.uk/news/uk-42359676
http://www.bbc.co.uk/news/uk-42434767
http://www.bbc.com/news/technology-42342216
http://www.bbc.com/news/av/world-europe-36701574/is-russia-happy-with-brexit
Claire says:
Does anybody actually buy this Russian intervention stuff ?
I think it’s just media running with US security industry hogwash.
I don’t believe a word of it.
I do….
Andy,
Those stories have a strong premise and not one that can simply be dismissed by feelings and general impressions.
“the current success..”?
On the other hand, experiencing the reboot first, is often a big advantage.
The problems of consumerism, capitalism and the even opposing forces within the EU,( without the UK.)
In turbulent times, being free to adapt is an advantage.
We will only know the future once it is past.
“….the likes of Jacob Rees-Mogg would think that a descent into hell is the necessary pre-condition for the rising of the new free market world for which he craves…..”
In sofar as that is true of the Moggite tendency – it’s alright for them; they aren’t the ones who will suffer the descent into hell.
Pitchforks at dawn….
I agree with the general consensus of having feelings of a lack of control and fragmentation. I try to remind myself that nothing is truly a dead certainty (apart from the two specific phenomena) and to continue to support what I hope and reason are the best options for the country. I’ve found some solace in learning and it is something that continues to shape my views. The last time I picked up texts on economics was back when I studied for my A levels, so I am finding my renewed interest does bring me some enlightenment as well as some hope – I only encountered the term MMT last year and so far the reading is encouraging although I have only covered a portion of the basics.
I think it worth learning
I’d seriously encourage it…
Richard
Please do keep on waking up and doing what you do.
I suspect I will
Please can you tell us more about this VIX “trading volume index” and what it means?
Please feel free to do so
You referenced it in your main post, so I assumed that a) you understood what it was and b) there was a reason that it was relevant to the point you were trying to make.
If you don’t understand that it is nothing to with volumes and everything to do with volatility, that would explain a lot. Why don’t you just admit this?
Oh, you mean volumes traded and volatility are unrelated?
Really?
Thank thanks for your excellent blog, Richard. It is the first email I open each morning. I am even beginning to understand ecomomics (a little)!
This morning I even worked out how to share some of your excellent articles on Facebook! It is vital for us to share information about the damage Brexit is doing…sadly much of the press (including the BBC) is failing to give an honest picture.
Keep up your good work!
Thanks
Why not just admit you made a mistake and the VIX is not the trade volume index that you claimed?
I used volume of trade as an indication of volatility
Whoopee
You are time wasting Bill
That means you will be deleted now