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The Price of Civilization: Economics and Ethics After the Fall
The Price of Civilization: Economics and Ethics After the Fall
by Jeffrey Sachs
Edition: Hardcover
Price: 16.06

48 of 49 people found the following review helpful
4.0 out of 5 stars Doomed again..., 27 Oct 2011
Verified Purchase(What is this?)
The title of Jeffery Sachs' book is taken from a quote by Oliver Wendell Holmes Jr:

'I like to pay taxes. With them I buy civilisation.' (P210)

That is the key theme of this book. Although centrally concerned with the current state of the USA, it is clear that many of his criticisms of the USA can also be levelled at other countries that have embraced the neoliberal doctrines of the 1980s.

The book starts by charting the, by now, well mapped route that has led us to the current economic mess. Things started going seriously pear-shaped in the 1970s, with Nixon effectively tearing up the post-World War 2 Bretton Woods agreement:

'...the Bretton Woods dollar-exchange system collapsed, basically because America's inflationary monetary and budget policies during the Vietnam War era were destabilizing the world economy. The United States abandoned its monetary links with gold on August 15, 1971. Inflation soared worldwide as the major market economies searched for a new approach to the global monetary system.' (P29-30)

Later in that same decade, of course, came the dreaded 'stagflation' as oil prices surged. In the UK we saw, on the one hand, a rise in union militancy and, on the other, a growing disillusionment with and a reaction against state planning and the 'mixed economy'. In economics, the ideas of Hayek and Friedman appeared to offer solutions - minimising the role of the state would allow the creativity of the free market to regenerate the economy. These ideas neatly coincided with the individualism of the time and the stage was set for Reagan in the US and Thatcher in the UK:

'Together, Reagan and Thatcher launched a rollback of government the likes of which had not been seen in decades. Many of the measures of the Reagan presidency, notably the sharp cut in the top tax rates and the deregulation of industry, won support throughout the economics profession and the society.' (P30)

There was a huge antipathy towards government and a belief that 'society could benefit most not by insisting on the civic virtue of the wealthy, but by cutting their tax rates and thereby unleashing their entrepreneurial zeal.' (P31)

Or, to put it another way, 'Greed Is Good'.

All this has been documented many times before, albeit from different angles. For example, Sachs refers to the rise of Multi-National Companies or MNC's. Colin Crouch similarly notes their growing dominance but refers to them as Trans-National Companies, or TNCs. To my mind, this is not simply a difference of terminology. Sachs himself recognizes that these TNCs no longer hold any loyalty to any national polity - they are, in Crouch's term, 'trans-national' - across and above any local loyalties. Countries find themselves competing to attract these TNCs in the hope that they will pay taxes and provide employment - but, in order to attract them, taxes are lowered, employment legislation limited or repealed. There is, as Sachs says, a 'race to the bottom'.

Of course, money can be converted into power and vice-versa. Sachs details the huge rise in political lobbying. Again, this is not new - Thomas Frank's excellent 'The Wrecking Crew' covered this back in 2008, just before the onset of the current malaise. Sachs refers to a 'corporatocracy' - what others have referred to as oligopoly or even (and quite possibly more accurately in my opinion) kleptocracy.

As far as the political parties are concerned, however heated the debates might appear on the surface, there is little real difference between them, as Colin Crouch has also pointed out, albeit in a different context. Sachs suggests that the Republicans are dominated by 'Big Oil' (besides the obvious - Bush, Cheney et al - Sachs, on two or three occasions, refers directly to the Koch brothers who also help fund the Tea Party) while the Democrats are dominated by 'Big Finance' and Wall Street. The revolving door between lobbying companies, Wall Street and Washington is well documented, executives from Goldman Sachs providing many notorious examples.

The American political system is particularly susceptible to lobbying companies and the associated corporatocracy because, unlike a parliamentary system, the executive is separate from the political parties. This means that members of both houses can put their individual interests ahead of the parties'. Additionally, campaigning costs are so huge that donations from corporations are essential, donations that are considered to be 'investments'.

Sachs considers the role of globalisation. It is interesting to compare Sachs' views with those of Dani Rodrik ('The Globalization Paradox'). Rodrik suggest that there are three areas of globalisation - trade, finance and labour, with labour being the least globalised of the three. It was the globalisation of finance that really started destabilising the system, as money could be moved into and out of countries at the click of a mouse. But Sachs considers the effects of globalisation on labour. Relatively low skilled jobs are easily exported to low wage economies, leaving the less skilled in the developed economies such as the US (and UK) under- or unemployed. The roll-back of state provision of education has exacerbated the effects of this, as poorer students drop out of college, unable to continue their studies.

Sachs also turns his attention to the media, to consumerism and to what he terms 'hypercommercialization' (P146). Going back to Edward Bernays, Sigmund Freud's favourite nephew, he charts the rise of manipulative consumerism and the concomitant fall in communality, as people retreat to their homes, fragmented and isolated. Again, none of this is particularly new (see, for example, Sold on Language) but by bringing it in, Sachs usefully deepens and extends his analysis.

At the end, what Sachs considers is fundamentally lacking from American society at the moment is a sense of 'mindfulness' and balance. Extreme free market libertarianism only benefits a small elite, such as the Koch brothers. On the other hand, too much state control suffocates individual creativity. A middle way must be found:

'Two of the great ethicists in human history, Buddha in the East and Aristotle in the West, hit upon a remarkably similar prescription for the long-term happiness of humanity. "The Middle Path," said Buddha in the fifth century B.C., would keep humanity balanced between the false allures of asceticism on the one side and pleasure seeking on the other...Aristotle gave his fellow Greeks a similar message, that "moderation in all things" was the key to eudemonia, or human fulfilment.' (P162)

In his latest book, Will Hutton argues for a return to Enlightenment values. Really, both Sachs and Hutton are arguing for the same thing. It's also interesting to see writer like Michael Sandel drawing upon Aristotle for theories of justice.

Sachs goes on to propose some rather more concrete actions to get America and, by implication, much of the rest of the world, out of it's self-destructive course - but his underlying principle is one of balance and this 'middle way'. He frequently cites Scandinavian countries - Sweden, Denmark and Norway - as examples of societies where citizens accept high taxes and government involvement in the day-to-day running of society and consider it the 'price of civilisation'. Sachs feels, and quotes statistics to back up his feelings, that there is support for such an approach in the US. His approach is rather more holistic than, say, Dani Rodrik's who sees governments' role as one of curbing the excesses of globalisation, and it is rather more optimistic than Colin Crouch's, who considers governments to be pretty much corrupted by, or subsumed into, trans-national corporations and who looks to external pressure groups and activists (such as, perhaps, the 'Occupy Wall Street' demonstrations) as an alternative.

Frankly, I don't really find any of them finally convincing. I agree with Colin Crouch (and Peter Oborne) that there are now unaccountable ruling elites, thus I don't hold out much hope for Dani Rodrik's idea that governments will be able to control the pace and direction of globalisation. I agree with Sachs that there is a ground swell of support for government intervention, particularly amongst the 'Millennium Generation', but I don't see the ruling kleptocracies relinquishing their famed 'vampire squid'-like hold any time soon. On the other hand, as Vladimir Lenin reminded us, "The Capitalists will sell us the rope with which we will hang them."

All in all, though, a very readable and thought-provoking book. :-)
Comment Comment (1) | Permalink | Most recent comment: Sep 2, 2012 7:06 PM BST


Busy Monsters: A Novel
Busy Monsters: A Novel
by William Giraldi
Edition: Hardcover
Price: 12.88

1 of 1 people found the following review helpful
4.0 out of 5 stars Homar's Oddity, 17 Oct 2011
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This review is from: Busy Monsters: A Novel (Hardcover)
This is a nice little post-modern Odyssey for our time. Our hero, Charles Homar, the lapsed Catholic and mildly famous memoirist, meets and falls in love with the giant squid obsessed and Jewish Gillian. After confirming the demise of Gillian's previous partner, all seems set for a lifetime of married bliss. However, Gillian's obsession launches a ship that launches our hero into his Homeric Quest. As he says:

"What could I do? Baffled, I dipped pita bread into my hubris and then declared that hummus was the fatal flaw that got Agamemnon stabbed in his bathtub." (P38)

In his bafflement and struggle towards resolution and enlightenment, he must face incarcerated Loch Ness Monster-ologists, Sasquatch, Mexican dwarf UFO hunters, Cyclopedic bed snakes, Asian sirens, most of whom seem to be avid fans of his memoirs, as each comes pre-warned of his exploits.

His friend and sometimes mentor Groot, when not doing dubious deeds in American conflicts overseas, advises and encourages our hero in his Quest, although, at one point, coming close to quoting the Kurgan - when introduced to a hotelier with spray-on shorts and remarkable eye-brows, 'Hi, I'm Candy', he replies 'Of course you are.'

Our hero looks, at one point, for a Grand Inquisitor to, as Father Henry comments, 'spice up his memoirs':

""Always a bad idea to rip off Fyodor," Groot said.
I said, "Are you kidding? I've been ripping off everybody from the Sumerians to the Beats, with lengthy stops in ninth century BC Greece and sixteenth century Spain."" (P222)

How many cross-cultural and historical references can you get into one, short novel? Probably many more than I picked up on. In that sense, it rather surprisingly reminded me of William Gibson - Zero History indeed. But the writing, as you might perhaps divine from the short quotes I have provided, is very far from Mr Gibson's sparse, dry style. In fact, pretty much the opposite, almost Banville-like in allusions, colour and playfulness. At times, perhaps the language is there purely for language's sake - as, early on, solipsism threatens. But still later, the author records criticism for his earlier self-obsession, turning the memoirs into something akin to an M.C. Escher print.

It is most certainly witty and, after all that, it is occasionally laugh-out-loud funny. It is clever, it is well-crafted, it is fun. It is also annoying, irritating and self-obsessed. It is worth reading. I enjoyed it.
:-)


Culture in a Liquid Modern World
Culture in a Liquid Modern World
by Zygmunt Bauman
Edition: Paperback
Price: 11.95

2 of 3 people found the following review helpful
5.0 out of 5 stars Liquid Modernity, 2 Oct 2011
Customer review from the Amazon Vine Programme (What's this?)
This is a thoroughly enjoyable and thought-provoking book. It is not long - only about 117 pages plus notes - but in each short chapter, Bauman explores some aspect of culture as it now appears in our 'liquid world' in such concentrated detail that it keeps you thinking long after putting the book down.

By 'liquid world' Bauman refers to what other writers have termed 'postmodernity':

"I use the term 'liquid modernity' here for the currently existing shape of the modern condition, described by other authors as 'postmodernity', 'late modernity', 'second' or 'hyper' modernity." (P11)

For Bauman, what makes our current time 'liquid' is:

"...its self-propelling, self-intensifying, compulsive and obsessive 'modernization', as a result of which, like liquid, none of the consecutive forms of social life is able to maintain its shape for long." (P11)

Whereas Modernism saw the world progressing towards something - hopefully a 'better, brighter future' - this 'liquid modernity' progresses purely for the sake of progression - it is not going anywhere, it simply is, in a permanent state of renewal. In this sense, Fukuyama is perhaps correct. History has ended and it seems There Is No Alternative. Or, to put it another way, there is no destination, only the journey - "For 'gardeners' utopia was the end of the road, while for 'hunters' the road itself is the utopia." (P29) And we are again hunters.

The first essay 'Historical peregrinations of the concept' places Bauman's idea of 'culture' pretty much squarely within a European tradition. In Britain, we have maybe been used to a more literary approach - from Matthew Arnold, F R Leavis, T S Eliot through to the more anthropological conceptions of Raymond Williams and Richard Hoggart. But Bauman looks to Adorno, Habermas and Bourdieu, amongst others. For example:

"As Bourdieu noted earlier, culture today is engaged in laying down temptations and setting up attractions, with luring and seducing, not with normative regulation; with PR rather than police supervision; with the production, sowing and planting of new needs and desires, rather than with duty." (P13)

Somehow, though, this does sound remarkably English (or Anglo-Saxon), with its undercurrent of disapproval for the 'Consumer Society'. But at the same time there is a grounding in European (Post-)Structuralism - defined as:

"networks replace structures, and an uninterrupted game of connecting to and disconnecting from those networks and the neverending sequence of connections and disconnections replaces determination, allegiance and belonging." (P14)

Finally:

'The function of culture is not to satisfy existing needs, but to create new ones - while simultaneously maintaining needs already entrenched or permanently unfulfilled. Its chief concern is to prevent a feeling of satisfaction in its former subjects and charges, now turned into clients, and in particular to counteract their perfect, complete and definitive gratification, which would leave no room for further, new and as yet unfulfilled needs and whims." (P17)

That is the theoretical underpinning. From there, Bauman goes on to explore various themes:

'On fashion, liquid identity and utopia for today - some cultural tendencies in the twenty-first century'.

'Culture from nation-building to globalization',

'Culture in a world of diasporas',

'Culture in a uniting Europe',

'Culture between state and market'.

All of these essays are fascinating. But what I found really interesting is comparing Bauman's views and analyses with other writers such as Paul Scheffer on 'immigration and diasporas', Colin Crouch, David Harvey and Dani Rodrik on 'state and market' and globalization. Bauman's basis is, as already stated, one of cultural critique, whereas the other writers have differing angles. But Bauman's stance somehow helps to pull all the other perspectives together (rather like Adam Curtis's eclectic documentaries) while at the same time shining fresh light on some seemingly small subject that has unexpected global significance.

I am very much looking forward to reading more of Professor Bauman's books.
Comment Comment (1) | Permalink | Most recent comment: Oct 7, 2011 7:32 PM BST


By Light Alone
By Light Alone
by Adam Roberts
Edition: Hardcover

8 of 8 people found the following review helpful
4.0 out of 5 stars Nil By Mouth, 29 Aug 2011
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This review is from: By Light Alone (Hardcover)
In the past, rich people were fat and the poor skinny. These days, poor people are fat and the rich are skinny. In Adam Roberts' future, the rich are bald and the poor grow their hair as long as they can. The reason for this is that Nick Neocles developed the Bug. Once ingested the Bug turns hair into an organ capable of photosynthesis. The poor need never go hungry again. And to prove their superiority, the rich ostentatiously live on 'hardfood'.

By this simple invention (and a single act of 'suspension of disbelief') Roberts recasts our contemporary world. The rich are even richer; a super-rich 'stateless elite' who have less and less in common, have less and less empathy with, the vast bulk of humanity. Just maintaining an interest in current affairs is considered rather distasteful. Those in the squeezed middle are yet more stressed and terrified of falling - made up of an increasingly obsequious professional class, a hard-pressed and terrified bourgeoisie ('jobsuckers' as they are disdainfully referred to by the super-rich) . The poor are truly, absolutely poor. Previously, it was necessary to give the poor some few pennies to keep body and soul together. Now, there's no need to even do this. A little water, a few grubs and insects and a sunny day is all this lumpenproletariat needs. Meanwhile, the super-rich breakfast in New York, fly by ramjet to dine in London and ski on Mount Ararat.

So that's the basic premise. It is, like the previous 'New Model Army' and others, overtly political. It is wickedly, almost grossly, satirical - which means that, really, there are hardly any endearing characters. But there are some really interesting ideas. The impact of this one change on relations between men and women, on religions, on security and national borders, on the media are all woven into the story, exaggerating and illuminating things that are already part of our here and now.

The book is in four sections. The first three are divided into short chapters, but the final section is one long narrative, with just the occasional break. The narrator intervenes in person on a few occasions too. While reading the first three sections, I was reminded really strongly of Margaret Attwood and maybe Huxley too. The prose is wonderful - somewhere close between the sparse coolness of Ballard and the beautiful precision of Banville.

The first section, then, introduces us to most of the characters, sets up the premise and the initial event that sparks the narrative. The following two sections begin to explore the ramifications through the eyes of two of the protagonists. But the final, and longest, section turns into a quest, a sort of Odyssey. And I have to say that I found it the least satisfying of the four. Perhaps it was the lack of chapter breaks, perhaps it was the subject matter, but I found it hard work, particularly after the satire and social observations of the middle two sections. Which is not to suggest that the final section does not contain satire, just that overall it took a while to gather steam, seemed a bit, well, peripatetic, before coming together into a fairly satisfying grand finale.

Overall, there is some wonderful writing here, some great story-telling. If you've read previous Adam Roberts books, you'll know what to expect. If not, don't come to this expecting some kind of escapist sci-fi. It's a lot more than that.
Comment Comments (4) | Permalink | Most recent comment: Oct 13, 2011 8:45 AM BST


Dicota D30257 Bounce 15-16.4 Inch Notebook Messenger with Cushioned Notebook Compartment and Separate Document Pocket - Grey/Pink
Dicota D30257 Bounce 15-16.4 Inch Notebook Messenger with Cushioned Notebook Compartment and Separate Document Pocket - Grey/Pink

4 of 4 people found the following review helpful
4.0 out of 5 stars From The Lands Of Grey And Pink, 26 Aug 2011
Customer review from the Amazon Vine Programme (What's this?)
This bag is grey, grey, grey (apart from one little pink tab) until you open it and then it displays it's pink, pink, pink interior. Dicota is a German company, this bag was made in China - and so this, their invention, is from The Lands Of Grey And Pink. Yes, I suppose that is stretching it a bit, but I like a bit of music while I work.

So - is it any good? Well, I got it for my 15" metal-bodied MacBook thing. To be honest, it's a bit big. The description says, or at least implies, that this bag is suitable for 15" to 16.4" machines, but my machine is slopping about a bit, seasick in it's prawn pink cocoon. Still, better that than too small. At least the machine is well-cushioned and held in place by a substantial grey Velcro-ed strap.

The section next to the laptop compartment is voluminous and will certainly swallow any power supply. But I do wish that either the UK would change its plugs to the less abrasive two-pin continental variety, or that bag manufacturers could find some way to neutralise the pointy problem of the UK's over-sized three-pronged lumps. They're about as attractive as the now well-and-truly superseded SCART connectors, but even more uncomfortable when sat on.

At the front is a zip compartment, about 30cm wide. The zipper pull comes in grey, but an alternative pink one is also supplied, so that was fitted straight-away, I can tell you! The zipped pocket is not that deep - about 13cm - and rounded at the bottom corners. Still, being zipped adds to its functionality.

In front of the zipped compartment are two small open pockets, one pen pocket and one pocket the size of the two smaller pockets combined. Over all this, the flap fastens with a stout plastic click-buckle. And on the back of the bag is a full-sized document compartment, held together with (pink!) Velcro. All fairly standard and functional.

But there are just one or two little features that make you realise that some thought has gone into the design. The ones that I immediately noticed are the fold-over flaps at the top corners, positioned so that when you close the bag, there is no water-welcoming gap between the corners and the over-flap. Nice touch, I thought. The shoulder strap is wide, adjustable and with a moveable pad. The buckles are all plastic, but seem to be solidly made. The thing is, this bag feels extremely light, and perhaps the ubiquity of the plastic parts aids this. But still strong, even 'urban rugged'. The last thing you want is the bag to disintegrate while in use, dropping your precious processor onto an inevitably corrugated concrete concourse where it, along with all your corporate calculations, death-by-Powerpoint presentations, expense-claim spreadsheets (we won't mention the dubious bit torrents), shatters, spreading shards of shrapnel-like silicon, along with your aspirations to that key to the executive washroom. Of course, if it's a metal-bodied Mac, you will look on as that beautiful satin silver surface begins to resemble the post-industrial wasteland from which you spent your childhood struggling so hard to escape. Dreams mingle with tears...

Er...sorry. Yes, well. It is light. It is a bit big for my laptop, but it is otherwise practical, appears to be well-built and sturdy. No loose threads, no tatty finishes. It would perhaps benefit from a carrying handle on top - but, on the other hand, it is a 'messenger bag' and messenger bags do not generally have handles on top. So - a good bag. For a better look, go to the Dicota website, search for D30257, and watch the 45 second video. There you will learn that the bag is also available in a mundane blue. Go for the Pink, my friend. Go for the Pink.


Russell Hobbs 18272 Allure Mini Ball Chopper Food Processor
Russell Hobbs 18272 Allure Mini Ball Chopper Food Processor
Offered by No1Brands4You
Price: 22.99

14 of 15 people found the following review helpful
4.0 out of 5 stars Ensures well-mimsied borogroves, 21 Aug 2011
Customer review from the Amazon Vine Programme (What's this?)
Well, this is a useful little widget. Basically, it chops. But it chops very finely, so it effectively liquidizes as well. That is it - that is what it does. But, to be honest, that is really all I want from a food processor. I don't particularly want something that chops and shreds and does all the fancy bits. I want a machine that can do something that I would normally do myself more effectively than I could do it. And it does.

It holds half a litre - so not a huge capacity. It has a number of restrictions listed in the rather chatty manual. These include:

a) don't put raw meat of any kind into the bowl
b) don't fill above the 500ml mark on the bowl
c) don't process large amounts in batches - if you need to process large amounts, you need the mini-chopper's big brother, the Russell Hobbs Allure blender
d) don't process hard foods - i.e. anything you can't cut easily with a kitchen knife
e) don't chop big bits - maximum 18mm cubes
f) don't try to chop ice - you'll damage the blades

So - apart from those 'don'ts', it's fun, even to the mis-quotation from Lewis Caroll which I will not copy here. However, I've scanned the diagram of the chopper and you'll get the idea from that.

The bowl and top are made from fairly heavy-duty plastic. It says '7 >san<' on the bottom, which I think indicates that it is made of 'styrene acrylonitrile' (see the comments at the bottom of the review. I'll post a web link). Anyway, it's the same sort of plastic from which Lego and hard hats are made, according to a website I found.

The instructions also include a number of recipes - sweet and sour sauce, black olive and anchovy tapenade, horseradish and apple sauce, coriander pesto, spicy pumpkin soup (which you have to do in batches - so much for 'don't' type 'c'), and some sweet ones too, including 'strawberry mess'. I made some black olive and anchovy tapenade - very successfully, I think. It's a bit messy to clean afterwards, but no worse than your average food processor. I think the 'gyre and gimbling' (i.e. swivelling the ball around on it's base) has limited effect, to be honest, unless what you are chopping is very liquid, but it's a nice idea and it is kind of more satisfying than just whizzing stuff up.

Also included is a strange white plastic cup-like thing with two semi-blades. This is not mentioned anywhere in the instructions, as far as I can see. It's certainly not on the diagram. I have posted a photo of it, so you can see what I'm talking about. I think - and I admit I haven't tried this - that it'll be for whisking cream, maybe making sure your custard isn't lumpy too.

Overall, the gadget is fairly small, easy to clean and store. Given that my use of food processors doesn't really extend beyond finely chopping and liquidizing stuff, I think I'm going to be using this a lot. Maybe not a huge capacity, but how many litres of black olive and anchovy tapenade do you want?
Comment Comments (5) | Permalink | Most recent comment: Sep 10, 2011 9:59 AM BST


Saving Capitalism From Short-Termism: How to Build Long-Term Value and Take Back Our Financial Future
Saving Capitalism From Short-Termism: How to Build Long-Term Value and Take Back Our Financial Future
Price: 15.11

3 of 3 people found the following review helpful
4.0 out of 5 stars The Longer View, 13 Aug 2011
Professor Rappaport states that this book is aimed at:

'corporate executives, board members, institutional investors...employees, management consultants, investment bankers, public accountants [and] corporate governance activists' (Introduction, P XIX)

I'm afraid I don't really fit into any of those categories, although perhaps the last comes closest to my interests. However, I was an employee of a FTSE100 company for a number of years and have witnessed, in that time, the developing trend towards 'short termism' that Professor Rappaport identifies.

Rappaport sees the development of this 'short termism' as linked to the move away from 'entrepreneurial to agency capitalism', when 'owners managed and managers owned' (P7) towards, at the start of the 20th century, a corporate model. Still, up to the 1970s, most shares were owned by individual investors who looked for dividends, leaving managers free to concentrate on longer-term management and growth. But:

'[t]he rise of institutional ownership ushered in the era of 'agency capitalism'.' (P11)

In other words, a 'layer of agents' was interposed between the owners of capital and the businesses in which this capital was invested. And Rappaport suggests that:

'[s]hort-termism is a rational choice for investment and corporate managers whose job security, labor-market reputation, and compensation are tied to near-term performance.' (P12)

There is thus an overwhelming concentration on short-term (usually quarterly) goals and share prices. Although compensation packages for managers might have increased enormously, job security has decreased in proportion and so the incentive to plan for the long term and to put in place medium to long-term business development plans that may have an initial negative impact on quarterly earnings and the share price are simply rejected.

Rappaport goes on to suggest that this short-termism was an essential component in the recent (and on-going) financial crisis. Everyone could see that there was a growing housing bubble, that financial institutions were hugely leveraged, but the emphasis on quarterly figures meant that no-one was prepared to look that far into the future until, of course, that future arrived with a rather loud 'pop'. As Rappaport puts it:

'The herd mentality that produces bubbles makes it difficult to listen to doomsayers. But more important, it was in each CEO's self-interest to worry about quarterly earnings targets and the company's stock price and let someone else worry about problems that might surface down the road, such as collecting the mortgage payments.' (P22)

Interestingly, Rappaport extends this to cover even the idea of 'moral hazard' i.e. the idea that corporations knew they were 'too big to fail' and would ultimately be bailed out by the tax payer. He suggests:

'The bottom line is that the source of moral hazard is not public-sector bailouts but privater-sector incentive structures.' (P27 in italics)

Rappaport goes on to apply this analysis to many of the actors involved in the crisis including: private-sector culprits, home buyers, appraisers (e.g. mortgage brokers), lenders, credit rating agencies, corporate boards of directors, Wall Street investment banks (I think we can safely include London bankers here too) and institutional investors - all these groups looked only to the short-term.

Even Milton Friedman, the doyen of Chicago School neoliberalism, is recruited in Rappaport's arguments against short-termism:

'Friedman's basic argument is that companies do good by doing well. Doing well means maximising long-term shareholder value, not short-term profits.' (P51)

Rappaport emphasises that short-termism was only one of the essential ingredients in the financial crisis. He recognises that there are others, that there is no one cause, (for a nice list of other possible suspects, have a look at Howard Davies 'The Financial Crisis - Who is to blame?' and, of course, Nouriel Roubini's 'Crisis Economics') but he makes a convincing case for this element.

He goes on to considers the effects of short-termism on both corporations and investment management companies (e.g. mutual funds etc.) before turning his attention, in Part 2, to combating it.

Rapapport makes a number of clear and specific proposals, starting with 'Corporate Long-Term Performance Incentives' (Chapter 5). Here, he introduces the EPOPS or 'equity-premium option plan' (P102) aimed at ensuring that CEOs do consider long-term shareholder value. I am not going to outline this here - you'll have to buy the book, suffice to say that it does prompt management to take a much longer-term view.

Following this, in Chapter 6, he considers how companies might become 'long-term value-creating' organisations. Of course, Berkshire Hathaway features here, as does (in the notes at the end of the chapter) Jeff Bezos and Amazon.

Importantly, Rappaport also wants to see an 'Overhaul of Corporate Financial Reporting' (Chapter 7). As he says:

'In the wake of the global financial meltdown, standard setters and public companies have an unprecedented opportunity to meaningfully improve the usefulness of financial reports. Tinkering at the edges of income determination will not do the job. The accounting income model is broken. The stakes are high, and we need fundamental change.' (P162)

This strikes me as self-evident. But this will require legislation and legislating for 'transnational corporations' (or TNCs, as Professor Crouch refers to them) is not going to be easy. Such legislation will have to be international in scope and that usually results in a general 'levelling down' to a lowest common denominator.

In Chapter 8, Rappaport turns his attention to developing 'Long-Term Performance Incentives For Investment Managers' (P181). His hope is that:

'[t]he adoption of long-term performance fees...offers potentially significant social benefits...Most important, longer time horizons may lead to fewer bubble and bust cycles and stock prices that do a better job of allocating scarce resources.' (P192)

Finally, in Chapter 9, Rappaport considers strategies for improving long-term returns, reducing portfolio turn-over and developing 'expectation investing'. He even offers some 'detailed tutorials and downloadable spreadsheets' from his web-site.

Overall, this strikes me as a sane and comprehensive set of proposals for mitigating one of the more egregious features of modern capitalism. However, it is just one feature. It is difficult to see, perhaps, how these proposals might impact on, for example, electronic trading - the sheer speed of which makes markets so volatile. Then again, with finance now so thoroughly globalized (see Rodrik, Stiglitz, Roubini et al) and national legislatures often largely compromised by transnational corporations (see Thomas Frank and Colin Crouch's 'The Strange Non-Death of Neo-Liberalism') coupled with, in some quarters, a highly ideological opposition to any legislation that might be considered a hindrance to the 'invisible hand of the market', the chances of Rappaport's proposals being given the consideration they plainly deserve seem a bit limited.
Comment Comments (2) | Permalink | Most recent comment: Aug 24, 2011 12:52 PM BST


The Strange Non-Death of Neo-Liberalism
The Strange Non-Death of Neo-Liberalism
by Colin Crouch
Edition: Paperback
Price: 14.11

10 of 14 people found the following review helpful
5.0 out of 5 stars Aux armes, citoyens!, 4 Aug 2011
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Colin Crouch's analysis of the continuing dominance of neoliberalism starts with a definition and history of his terms, showing how the word 'liberal' in particular has gone through some almost total reversals since the repeal of the Corn Laws. The ascendency of 'neo-liberalism', however, began in the 1980s, after the perceived failure of Keynsian economics.

The original 'Hayekian' or 'Ordoliberalismus' anti-totalitarian formulation whereby competition is seen as 'a process that would maintain in existence large numbers of firms, near-perfect markets and widespread consumer choice' was replaced by the Chicago School's view that competition should be seen:

'in terms of its 'outcome' as the destruction of small firms and medium-sized enterprises, the dominance of giant corporations and the replacement of the demotic idea of consumer choice by a paternalistic concern for 'consumer welfare' (P16-17)

This concept of 'consumer welfare' is crucial. Unlike Hayek, this formulation accepts, even welcomes, the idea that competition will eliminate competition:

'If there would be efficiency gains from a number of smaller firms being bought out by a larger one, then that would be the outcome that would maximise what they called consumer 'welfare', even if it led to reduced competition and left consumers with a reduced choice of goods. What should therefore be the concern of the law courts in deciding antitrust cases is what outcome would be most conducive to the maximisation of consumer 'welfare', not 'choice' as such.' (P55)

By 'welfare', the Chicago economists considered the overall wealth of the society. The fact that the wealth may become increasingly concentrated in the hands of a small and diminishing number of transnational corporations (or TNCs) and a stateless elite is neither here nor there. Any redistribution of wealth should be undertaken by governments and is not the concern of the corporation.

But then, the Chicago school has a major problem with the idea of government. Here, their ideas fit neatly in with those of the University of Virginia. The Virginia school considers that civil servants, politicians et al, are there purely for self-advancement - as portrayed in Margaret Thatcher's favourite sitcom 'Yes Minister' where the Machiavellian machinations of Sir Humphrey had little to do with the promotion of societal good. Governments are seen as 'at best incompetent and at worst corruptly self-seeking' (P63).

The only way to ensure any efficiency and effectiveness in government is to apply the rules of the market. In other words, governments should act like, and learn from, firms. Thus we have the endless setting of targets, the breakup of government agencies into competing bodies and, most importantly, the inclusion of firms in the running of government in Public Private Partnerships (PPP), Private Finance Initiatives et al in almost an odd sort of reversal of mercantilism.

What develops from all this is a tripartite division - firms (TNCs), national governments and, surprisingly perhaps, the market. Here, 'the market' really refers to small and medium sized enterprises (or SMEs). It is perhaps interesting to compare this with Dani Rodrik's 'trilemma' where power is negotiated between the 'nation state', 'democratic politics' and 'hyperglobalization' - here 'hyperglobalization' more or less equates with the TNCs while the 'nation state' and 'democratic politics' conflate into national government, but the market is not really considered. I find Colin Crouch's model more convincing.

Although Crouch doesn't use the term kleptocracy, he does refer to oligopolies. Quite frankly, in the case of international banking in paricular, the difference is only one of degree. The virtual merger of politics and corporations, particularly in the US, is plain to see. The revolving door between government agencies, lobbying organisations and the corporations is notorious (see Thomas Frank's excellent 'The Wrecking Crew') but, at the same time, corporations consider themselves to be only responsible to their shareholders - the maximisation of shareholder value is considered to be management's sole aim, even though they are increasingly intimately involved in the legislative process.

It is odd, then, to see the rise of Corporate Social Responsibility (CSR). More often than not, of course, this is simply just a marketing tool. Crouch puts it nicely in the heading of chapter 6 - 'From Corporate Political Entanglement to Corporate Social Responsibility'. Political power has become increasingly concentrated in firms, or governments acting like firms or firms working for/with governments. This is hardly surprising. As Crouch says:

'a polity in which economic resources were very unequally shared would be likely to be one in which political power was also concentrated, economic resources being so easily capable of conversion into political ones.' (P125)

Later, he seems to echo Peter Oborne's 'The Triumph of the Political Class':

'...the state, seen for so long by the left as the source of countervailing power against markets, is today likely to be the committed ally of giant corporations, whatever the ideological origins of the parties governing the state.' (P145)

It seems that CSR has, then, almost taken the role of what the French aristocracy used to refer to as 'noblesse oblige' (P150). But, suggests Crouch, the growing CSR movement might be seen as a reaction to pressure from a fourth element outside the 'firms, state and market' - 'civil society':

'Civil society includes, though extends further than, the voluntary sector. It defines all those extensions of the scope of human action beyond the private that lack recourse to the primary contemporary means of exercising power: the state and the firm...States and firms do dominate our societies, but there is a lively field of contention. Challenges to domination can be made, concepts of public goals explored and turned into practical projects, against the state's claim to monopoly of the legitimate interpretation of collective values, and against the firm's claim that the conversion of values into the maximisation of shareholders' interests is as good as life can get.' (P153-4)

Crouch considers that there are potentially five types of groups that may challenge the state and the firm. Most of these are pretty well compromised, he feels, and I would agree. Political parties (see Peter Oborne) and most organised religions - both seem unlikely contestants. Whether campaigning groups, the voluntary sector and ethically motivated professionals can make the difference and wield the 'power of the powerless' is finally what this book is about. Where Dani Rodrik calls for a 'reining in', a deliberate limitation to 'hyperglobalization' in order for nation states to again exert a moderating influence, Crouch sees the nation state as hopelessly compromised and the only moderating and humanising influence coming from civil society:

'Civil society...operates in the interstices left among the great erections of political and economic power, like little houses springing up busily and untidily, creating vitality in a street dominated by the inaccessible security-controlled doors of skyscrapers. Since it contains a vast array of competing groups, with different and sometimes opposed moral agendas, it also embodies a kind of moral relativism. But this is moral relativism only at the meta-level of the character of the system as a whole. Within it the great majority of participants act with moral purpose. In societies that contain a plurality of rival values, where no religion or set of beliefs has hegemony, that is all we can hope for.' (P161)

The question is, is it enough? Is this anything more than a 'post-modern relativist politics' or a restatement of 'pressure group politics'? I'm not convinced - but the ideas just might help fuel resistance to the neoliberal monolith. Thank-you Professor Crouch. :-)
Comment Comments (3) | Permalink | Most recent comment: Sep 9, 2011 3:13 PM BST


The Globalization Paradox: Why Global Markets, States, and Democracy Can't Coexist
The Globalization Paradox: Why Global Markets, States, and Democracy Can't Coexist
by Dani Rodrik
Edition: Hardcover
Price: 13.59

19 of 20 people found the following review helpful
4.0 out of 5 stars On The Horns Of A Trilemma, 31 July 2011
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Dani Rodriks's new book is a very interesting - and rather alarming - look at the current state of globalization. His basic proposition is that we are currently experiencing the:

'fundamental political trilemma of the world economy: we cannot simultaneously pursue democracy, national determination, and economic globalization. If we want to push globalization further, we have to give up either the nation state or democratic politics. If we want to maintain and deepen democracy, we have to choose between the nation state and international economic integration. And if we want to keep the nation state and self-determination, we have to choose between deepening democracy and deepening globalization. Our troubles have their roots in our reluctance to face up to these ineluctable choices.' (Introduction P XVII-XIX)

Over the course of the following twelve chapters, Rodrik gives us a history of globalization and free trade (pre- and post-World War 1), a consideration of the economic theories and policies that have affected the responses to them (Keynes, Bretton Woods, GATT, WTO, the 'Washington Consensus' etc.) and a look at specific national responses to globalization (South Korea, China, Argentina, South Africa amongst others), before returning to and expanding on his theme of the 'Political Trilemma' (Chapter 9). Finally, he makes a number of proposals for the design of 'Capitalism 3.0' (Chapter 11) before looking forward to 'A Sane Globalization' (Chapter 12).

Initially, Rodrik examines the relationship between states and markets. He suggests that '...markets are not self-creating, self-regulating, self-stabilizing, or self-legitimizing.' (P22 in italics) He continues: 'If states are indispensable to the operation of national markets, they are also the main obstacle to the establishment of global markets'. (P22)

Thus we see the beginnings of the 'trilemma'. Global markets fall between national regulatory systems. One solution to this, historically, was mercantilism (P23).

The first great era of globalization, prior to the First World War, Rodrik suggests, was down to a number of factors - new technologies played a major part, but so did a growing acceptance of Adam Smith's ideas, leading to a desire to reduce tariffs and other 'transactional costs'. However, the reduction of these costs was also largely down to imperialism which helped to minimise the 'regulatory gaps' between nations. Even so, the actual period of 'free trade' was relatively brief - roughly the 1860's and 1870's (P26). The fact is that the role of the nation state was always crucial, always underpinned 'free trade'. It is not simply a question of removing the state from the picture - 'free trade' cannot exist without the state. The relationship between the two is complex, subtle and quite inextricable.

Rodrik examines the relationship between the state, civil society, free trade and globalization in detail in Chapter 3. He also criticises his fellow economists:

'When economists oversell globalization by presenting an incomplete case for it, they not only lose an opportunity to educate the public, they also lose credibility. They become viewed as advocates or as hired guns for the "stateless elites" whose only interest is to remove impediments to their international operations.' (P66)

Rodrik next considers the Bretton Woods agreement and the development of a limited form of globalization post-World War 2. He, like many economists, sees this as a golden era for which Keynes and Harry Dexter White were largely responsible. Rodrik sums up Keynes' views on globalization as:

'Unqualified commitment to free trade was feasible only when societies were ruled by narrow technocracies with faith in a uniform type of capitalism. It ceased to be practical, or even desirable, in a world where nations were experimenting with alternative visions of political economy.' (P68)

Again, an indication of the 'trilemma'.

Freeing up trade in goods, Rodrik believes, has largely been a 'good thing'. But it was with the freeing up of finance that things started going awry. With the 'stagflation' of the 70s and the subsequent move towards 'supply side' economics and floating exchange rates, capital became 'excessively' mobile. This caused huge problems: in Latin America, Mexico, Europe, South East Asia (1997-8), Russia (1998), Brazil (1999), Argentina (2000), Turkey (2001). (See Naomi Klein for an alternative perspective on this).

It turns out that those countries that were most successful, as has been noted many times before (Roubini, Stiglitz et al), were those who precisely did not open up their economies to the vagaries of globalization; South Korea, Taiwan, India and, of course, China, have all protected their fledgling industries, ensuring their establishment before opening them up to international competition. Rodrik specifically rejects Tom Friedman's contention that donning a 'Golden Straightjacket' of 'free trade, free capital markets, free enterprise and small government' (P189) was the only way to successful economic progress. But:

'...Friedman's central insight remains valid. There is a fundamental tension between hyperglobalization and democratic politics. Hyperglobalization does require shrinking domestic politics and insulating technocrats from the demands of popular groups. Friedman erred when he overstated the economic benefits of hyperglobalization and underestimated the power of politics. He therefore overestimated the long-run feasibility, as well as desirability, of deep integration.' (P189-190)

Again, we see the 'trilemma' raising its head, again we see the tension between national democracies and global markets. And globalization is not yet complete. Although trade and finance are pretty well globalized, there is a third area that has barely begun the process - and that is labour.

Finally, Rodrik moves on to possible ways forward. Admitting that a global government is unlikely to arrive any time soon, his solution is essentially to limit the scope of globalization, promoting the importance of democratic national governments over the demands of, as he puts it, hyperglobalization, even at the expense of efficient markets. He expands on these ideas in 'Designing Capitalism 3.0'.

Whether you think that these proposals are feasible or not, judge for yourself. Making markets subservient to local/national regulatory systems will inevitably increase 'transaction costs' but if this means a 'saner' globalization surely this is a price worth paying.

However, some of his proposals struck me as simply unrealistic. In particular, I was not impressed with his proposals regarding labour. He suggests that workers from developing countries should be allowed temporary (five year) visas to come and work in richer countries. To avoid these workers overstaying, the visas should work on a 'one in, one out' basis, so that the worker would have to return to their country in order to allow another worker the opportunity.

At this point, I think it would be an idea to read 'Immigrant Nations'. Will these workers be allowed to bring their families with them? If such a worker brings a child with them, that child will be educated in the host country for the duration of their stay. What of the cultural differences? If such a worker was to start a family in the host country during their five year period, will the whole family return? In a labour market which is increasingly 'hour glass shaped', (see Owen Jones, amongst others) these workers will most likely be either highly skilled professionals or un/semi-skilled workers who will push down the value of wages in the host country, making them an inevitable source of tension.

Overall, this is a very readable book, making many valid points. But in the end, I was unconvinced. Quite frankly, I think it's too late. As I've said elsewhere, I believe that the Goldman Sachs Vampire Squid and the Kleptocracy (a.k.a. "stateless elites") have got far too firm a hold and we are more likely to see the rise of a new form of feudalism. In the end, hyperglobalization is just another Road to Serfdom. We are so doomed.
Sorry. :-)
Comment Comments (3) | Permalink | Most recent comment: Nov 29, 2011 12:49 PM GMT


PestBye Battery Operated Cat Repeller - Ultrasonic Cat Scarer
PestBye Battery Operated Cat Repeller - Ultrasonic Cat Scarer
Price: 14.99

1 of 1 people found the following review helpful
5.0 out of 5 stars Zapp!, 18 July 2011
Verified Purchase(What is this?)
Been using this now for about three weeks, in conjunction with these Fence Wall Spikes and, so far, it has been 100% successful.

The unit itself comes in a deep dark green. Four AA batteries fit into the back, a thin square rubber washer ensuring that the compartment is weather proof. The back is held on with four small posidrive screws - so you will need a suitable screwdriver - and a substantial metal spike is fixed to the base with two small bolts. There's also a fixing point on top of the unit, so you could hang it from a hook, rather than stick it in the ground. So the unit certainly appears to be well designed and made.

The instructions that come with the unit only cover putting the thing together and not the actual functioning. Those instructions can be found here on this web page. I didn't notice that and e-mailed the supplier, receiving a very polite and helpful reply within a couple of hours. Then I felt a bit of a wally, as I realised that all the information was here. Oh well...

Anyway - two knobs. On the left 'Sens.' This is the sensitivity. The range of the unit is variable. The area I need to cover is quite small, so I have turned the sensitivity right down. This will apparently enhance the battery life.

'Freq.' refers to the frequency of the ultrasonic sound that the unit emits - again, the various ranges are listed on this page. I've got it set to about 4 and, as I've already said, this seems to be effective. Even though I can't hear the ultrasonic sound, I assume that it is working as a little blue light comes on when I come within range and I can hear a clicking noise.

There is just one thing though. I know that this is going to sound a little bizarre, but whenever I come close to the unit, I feel like I'm going cross-eyed. I'm sure this must be completely psychosomatic. If I could disable the blue light and the clicking so I didn't know when it was active, I could test this out, but I can't.

Anyway, I have reduced the sensitivity as far as practicable so that it only covers a range of about 2 metres, so I think I have maximised the cat poo suppression effect while minimising the cross-eyed human effect.

So - yes, it works. I think. It's a bit difficult to prove a negative but, in conjunction with the aforementioned Wall Spikes, my back yard is now a cat poo-free zone! :-)
Comment Comments (5) | Permalink | Most recent comment: Aug 1, 2011 6:45 AM BST


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