January 18, 2010

POWER WATCH: THE COMING STORM

According to a new study, each German above 18 owns an average of 88,000 € (in money and property, stocks, etc...) as well as an additional 67,000 € in pension benefits (to be paid out when they retire). Now, that doesn't sound so bad, does it? Sounds like everybody's reasonably well off.

No, they're not. And here is why the mathematical average is one of the most powerful propagandist tools every to leave the realm of mathematics and enter the realm of political calculation. A mathematical average is worthless in looking at a soceity's stability, and it is more often than not used to put up a statistical smoke screen.

Because if one takes a look at the actual numbers, we see that...

10 percent of all Germans own 60 percent of all the wealth (the numbers in the US are even worse, but let us deal with Germany for a moment). 70 percent of all Germans account for... a whopping 9 (yes, nine) percent of all the wealth. And that leaves a middle class of 20 percent, accounting for roughly 31 percent of all the wealth.

Let's do those numbers again....

70 % of people = 09 % of all the wealth.
20 % of people = 31 % of all the wealth
10 % of people = 60 % of all the wealth

Just like in the US, those numbers have been getting progressively worse over the past couple of dcades, with a real, measurable drop in income and an inflation over 40 percent since 1990, or in other words, there are more people at the bottom than ever before, trying to scrape by without the chance to accumulate wealth, and a smaller growing number at the top that accumulate wealth with ever-accelaterating speed.

Before somebody thinks that this turns into a Communist rant, now, it won't. Like Ferris Bueller, I think that -isms are bad. They stop you from analysing. But the analysis will come without the shadow of a doubt to the conclusion that we are speeding up and aiming squarely at the wall that is coming up on the road to the future.

As I have travelled the world, I have seen the same thing over and over again. Any system, political and social, is stable as long as there are not less than roughly a third population in poverty. It's the old 1/3-1/3-1/3 theory that allows any system, yes, dictatorships as well, to function with relative ease. The actual political system is not as valuable to its citizenry as fevered supporters of democracy make it out to be. It's the social system that will make a state live or die, or rather the real and perceived distribution of wealth within such a system, with the chance of moving up from one social strata to the next.

Communism, like it or not, has been a relative stabilising influence on the Western democracies, and more importantly, on the Western economic systems from 1945 to 1990. And no, it's not that Communism was better, but it was that Communsim (or Socialism) provided a subconscious alternative, which in turn forced the Western capitalist system to never allow its citizenry to drop below the 1/3-1/3-/13 model. Or in other words, it gave enough people enough fear of losing what they had, with just enough hope of gaining more. It didn't matter that much that for most people, said hope would never be realised, it was enough that it was there. All the while it was secure that not too many would drop below the line of We don't give a fuck about you, thank you very much.

The brilliance of such a system had already been discovered by Otto von Bismark at the end of the 19th century, which led to the formation of both the pension funds and healthcare in the German Reich. Did he do it, because it was the right thing to do? That it was the moral thing to do? Nah. He did it to cut off the balls of any potential social uprising that was already in writing on the walls in numerous other European countries. What Bismark did was to give the lowest of the low something they would forever fear to lose. A safety net.

Since 1990, however, even the theoretical choice between two economic systems is gone. It's over. Kaput. Capitalism won, as the Ayn Rand worshippers like Alan Greenspan shouted from the rooftops! We won, motherfuckers! Okay, we didn't really win, what we did was, we outspent the Communist countries in both technology and weaponry and within our economic systems. Ever wonder where all that debt came from, originally? Uh, yes, that would be the reason. Sorry, Ronny Reagan. It wasn't your charming personality. Sorry, John Paul II, it wasn't your rhetorics (that ought to have some heads exploding)

It was money.

And the hope of earning enough to get your house, your car, you whatever made you happy that has stabilised the Western societies for such a long time. We can call it the American Dream, we can call it the good life, we can call it whatever we want.

The fact remains that it was primarily that hope (couple with the above-mentioned fear) that made our societies work.

That all changed in 1990.

Now we are living in a world that – for all those who have read both the works of Charles Dickens and the quite brilliant analysis of Karl Marx (don't be shocked! Don't run! Read him! His analysis of the world's economic history provides a very thorough look at things that have gone wrong, although some of it is coloured by his own faith system, i.e. the naive belief that it's all going to be well if only the workers would control anything) – is inching closer and closer to the world we have once seen in England. A orld that is based on Manchester Capitalism. A world that now has an entire country as its base for modern slavery (and yes, that would be China).

And in the Western countries, the economic balance that makes the democratic political system viable is shifting towards a point of no return. More and more people have less and less, but what those folks at the top don't seem to realise is that it also means they have less and less... to lose.

Now, I consider myself to be a humanist. I like to believe that we have the capacity to learn, but when I see what is happening around the globe, I am not so sure that we want to learn. Especially from history. There was a reason that the people in Czarist Russia revolted, and one should look into that. Forget Lenin. Forget Stalin. Look at the actual reason people started to revolt, the rest came later, much later in the game.

The reason was tha the Russian economic and social model had reached a tipping point, and enough people stopped caring if they died today or tomorrow, for they knew they would die, for they knew they didn't have enough rescources to feed their families, raise their children... and they had nothing left to lose.

We are headed, globally, for the exact same tipping point.

No, it won't be televised.

No, it won't be advertised.

But it will come.

And it will damn ugly.