There are basically two kinds of people in the world: those with too little money and those with too much. Those with too much between them control nearly half the world’s wealth, could;d fit comfortably in two or three jumbo jets.
According to Forbes magazine, the global stock of billionaires increased from 793 in 2006 to 946 in 2007 – a comfortable audience for the Ward Theatre. According to figures from the United Nations University/WIDER, the richest 1% of the world’s population — about 37 million people own 40% or nearly half of the world’s people, while the bottom half — nearly two billion people, together own just about one percent of the world’s assets.
In these computations, wealth does not include houses, however grand, nor transportation Rolls Royces or personal jets.
Th world — or at least some parts of it is in the throes of a billionaire problem; A Wall Street journal columnist reported last October on a visit to the super rich ski resort of Aspen Colorado and says he was struck by the number of rich people in town and by the number of locals who complained about the number of rich people in town.
Since our new tourism thrust is premised on the attraction of the super rich I decided to do little research into possible problems.
The rich do have one nasty habit: they keep on getting richer while the rest of us get poorer. In Aspen that causes problems. Natives can’t afford houses in their own town anymore. The price for a single family unit begins at US$ 5 million (about J$ 350 million) Not even doctors can afford to buy houses in Aspen any more. People are worried that there are too many Prada and Gucci stores in town and I would hate to imagine the price of a bottle of Perrier water or a Blue Mountain coffee.
I can just imagine it. I am the guest of some billionaire in Aspen and the party is on her. So, to impress her a little bit I take her to the nearest Starbucks (or the billionaire equivalent) an order two coffees. I then discover that I have to pawn my plane ticket to pay for them.
The rich grow richer effortlessly, but some of them, of course, like to grease the skids even though they know the lolly is coming down in floods anyway As we have seen in the united States, the middle class of that country, particularly the black middle class is undergoing a painful process of wealth extraction, taken to the cleaners by mortgage brokers and their outlaw in-laws in the derivatives business.
This has created a small problem, because though billions have been sucked out of the middle-class, some of it has almost literally vaporised into the high altitude world of sophisticated financial products, or derivatives, in which sub-prime mortgages were valued by eminent bankers as better than sovereign bonds issued by Jamaica or Venezuela or even the US itself.
‘Wealth creation’ depends eventually on the players finding a great number of what they call ‘Greater Fools’ willing to come in at the zany end of the market. The theory is that if millions of naive punters lose their shirts the loss will be spread over wide areas and no one will take too much notice.
But the ‘wealth creation’ game depends on a high velocity of circulation, with each hand retaining a smidgen of the gold dust that attaches to the securities which zip through the system like pork fat through a goose. Wealth cannot be created or destroyed. I have no intention of going into the theory of surplus value but you can take it from me that there is sweat is the real currency of the world and the source of all wealth. The transmutation of sweat into money and profit is what makes the world go round, but while the Earth may appear to be a perpetual motion machine there is no human system which can duplicate its effects for more than a moment.
So while wealth is extracted from middle class Americans and workers all over the world, eventually, classical economics and common sense all tell you that sales and profits depend on markets and markets depend on people and people depend on earnings and the whole structure collapses when the working class is gutted, as is happening at this moment.
Greed is the frictional element. If capitalists could be satisfied with ‘rational’ profits, all would be well. But they are not. Which is why the take home pay of the American workers has stagnated at 1973 levels and the wealth of his masters has expanded exponentially meanwhile.?
As Professor James Petras points out in an article (www.globalresearch.ca/index.php?context=viewArticle&code=PET20070323&articleId=5159) published last year, the rise of the billionaires was accompanied by serious social problems. Mass uprisings became commpnplace in India and China.
“In India, which has the highest number of billionaires (36) in Asia with total wealth of $191 billion, Prime Minister Singh declared that the greatest single threat to 'India's security' were the Maoist-led guerrilla armies and mass movements in the poorest parts of the country. In China, with 20 billionaires with $29.4 billion net worth, the new rulers, confronting nearly a hundred thousand reported riots and protests, have increased the number of armed special anti-riot militia a hundred fold, and increased spending for the rural poor by $10 billion in the hopes of lessening the monstrous class inequalities and heading off a mass upheaval.”
IT may surprise you to discover that in the United States, one in every 100 adult Americans is in jail. That amazing statistic includes one in every nine black men between 20 and 34 and one in every hundred adult black women behind bars.
Disparity in Growth
Petras said the total wealth of this global ruling class grew 35% per year while income levels for the lower 55% of the world’s people declined or stagnated. While General motors and Ford lay off thousands of workers the Federal Trade Commission is besieged by reports of millions of toxic toys from China flooding the market and Lou Dobbs on CNN is pathetically demanding action against Mexican and other illegal immigrants and some drastic surgery perhaps, on NAFTA.
Petras also deals with the “the newest, youngest and fastest-growing group of billionaires, the Russian oligarchy stands out for its most rapacious beginnings. Over two-thirds (67 per cent) of the current Russian billionaire oligarchs began their concentration of wealth in their mid to early twenties. During the infamous decade of the 1990s under the quasi-dictatorial rule of Boris Yeltsin and his US-directed economic advisers, Anatoly Chubais and Yegor Gaidar the entire Russian economy was put up for sale for a 'political price', which was far below its real value. Without exception, the transfers of property were achieved through gangster tactics assassinations, massive theft, and seizure of state resources, illicit stock manipulation and buyouts. The future billionaires stripped the Russian state of over a trillion dollars worth of factories, transport, oil, gas, iron, coal and other formerly state-owned resources.”
Globalisation, it is clear, does work for some.
The Obama Charisma
The fact that it doesn’t work for most of us is one of the factors behind the steamroller effect of Barrack Obama’s charismatic appeal. People see in him an answer to their frustrations with a government that does not seem connected to their concerns, their lives and their welfare.
The press, bless their hearts, are in a state of total confusion, incessantly parsing language and producing every day some new piece of intelligence which would a few years ago, have had the American electorate in a flutter. The problem is that the electorate is paying almost no attention to the conventional media or to their delegates in politics, the John McCains and the Bill Clintons.
An almost unnoticed development last week suggests that the American political system, like the economic structure, is in for a seismic shock. In the rock-ribbed Yankee Republican region of Upstate New York, in a seat held by Republicans for a century, a Democrat beat the wealthy Republican candidate in a special election. It was a seat with nearly 80,000 registered Republicans nearly twice as many as the 47,000 Democrats. The New York State senate has been controlled by Republicans for all but two years since 1939.
The prospect of Obama is scaring the Republicans silly. The one thing preventing an unprecedented flood of money for John McCain is that when his campaign seemed all but dead some six months ago, he entered into a deal with the Federal Elections Commission for public financing. Now that the Obama heat is on and billionaires are waiting in line to give him money, he wants to get out of the arrangement, but the FEC can’t even vote on his request because it has no quorum.
The result is that the real Republican campaign will be effectively financed from outside McCain’s purview by the kind of people who financed the Swift Boat campaign against John Kerry in the last election. That means that this election campaign, despite the civility and sophistication of Barack Obama and Mr McCain’s pious burblings, is going to be by far the dirtiest in the history of the United States.
You read it here first.
Criminal Libel and Hate mongering
The campaign to loosen our libel laws does not have my complete sympathy, which might seem odd for a journalist who has been sued unsuccessfully or threatened with more writs than any other in Jamaica. The problem is not really with the Defamation Act which has been broadly expanded by case law judgments in which the concept of privilege has been expanded and responsible journalists are given some real protection. The problem is with the procedure, which allows vexatious complainants to issue writs which have no chance of success in the hope that the writs will intimidate the publishers and perhaps the journalists.
But there is another point. People want to abolish the offence of criminal libel, which mainly consists of imputing criminal conduct or behaviour to someone. People are up in arms against criminal libel because some halfwits in the Southern Caribbean are using it to attack journalists. That clearly should be made impossible.
But criminal libel is also the only defence we have against hate speech, and in Jamaica the homophobes and xenophobes are having a field day inciting violence against homosexuals and Haitians. The reason is quite simple: hate sells newspapers. The criminal libel law is meant to deal with statements that are likely to lead to serious breaches of the peace, and if inciting people to murder homosexuals or anyone else is not such a piece of obnoxious wickedness I don’t know what is.
I believe that the ‘incitement’ section of the criminal libel law should be left intact, because I believe that certain newspaper editors should be forced to explain and answer for their outrageous and uncivilised behaviour. They should not be allowed to profit from it.
Copyright © 2008 John Maxwell