Here’s something to try get your head over. There’s three assumptions that the best part of the developed world depends on for its current progression.
First of all, cheap energy. I heard Max Keiser argue this week that capitalism depends on cheap energy (Keiser Report, E490). That is almost a profound statement, and is certainly true. In replacing human labour with machinery held in the hands of the rich few, those machines are useless without energy to power them. Cheap energy is the only viable alternative to skilled man power.
Next up: constant inflation. Today’s society is fiscally powered by a giant borrowing machine. It has no way of paying itself back, other than to devalue the debt through low interest rates and printing money (quantitative easing), which produces inflation. As long as investors are profiting out of this, it could go on forever, but part of that profit depends on the given countries’ currency’s ability to deliver goods, wherein constant inflation becomes linked to cheap energy. If a country and its currency cannot produce goods, then no level of inflation can sustain a nations needs. Your currency becomes worthless, and you end up with no buying power and potentially a hyper-inflationary crisis.
The final assumption is a common enemy. We’ve always had one. Everybody’s always had one. It seems that our current military hobby (the middle east) is about to expire, and the UN are gunning to take on Assad for the next decade. We’ve made ourselves some enemies closer to home as well. Part of society is carefully considering where to place their votes during the next election with regards to Eastern European open-door immigration. Having these enemies causes us to put great trust in our bourgeoisie government, which they love because it keeps them safe and minted for years to come.
They tell us we’re in the worst recession since the great depression of the 1930’s. Yet it’s all statistical. I don’t see people starving, cars still ride the roads, and there’s even positive newsflashes here and there about growth. So why aren’t all the doomsday theories coming to pass?
Earthquakes caused by fracking? Photo credit: martinluff via flickr
It’s because these three assumptions are still being met. World governments are desperately sucking out what energy they can get, hence the stir over fracking. Interest rates are at all time lows, and many financial experts warn that inflation is far higher than government figures (I mean, look at the price of potato’s!) And yeah, Syria.
But the cost’s of fracking now show in Texas, and the energy won’t last forever anyway. As capitalism dies under its own weight, clever inflationary tricks will become nothing. And notably, this week in Britain, the motion to begin air strikes on Syria were defeated in the house of commons, signalling that we’re no longer convinced by any passing tale as justification for a war.
The concept of capitalism is fundamentally flawed, and its dependencies cannot last.