LET IT DIE: Rushkoff on the economy

[burythehatchet]

Finally, I come across an author who states what I have felt in my bones my entire adult life, but was too reluctant to state.

Please read the entire article to understand his thesis completely.

http://www.arthurmag.com/2009/03/16/let-it-die-rushkoff-on-the-economy/

In a perfect world, the stock market would decline another 70 or 80 percent along with the shuttering of about that fraction of our nation’s banks. Yes, unemployment would rise as hundreds of thousands of formerly well-paid brokers and bankers lost their jobs; but at least they would no longer be extracting wealth at our expense. They would need to be fed, but that would be a lot cheaper than keeping them in the luxurious conditions they’re enjoying now. Even Bernie Madoff costs us less in jail than he does on Park Avenue.

Alas, I’m not being sarcastic. If you had spent the last decade, as I have, reviewing the way a centralized economic plan ravaged the real world over the past 500 years, you would appreciate the current financial meltdown for what it is: a comeuppance. This is the sound of the other shoe dropping; it’s what happens when the chickens come home to roost; it’s justice, equilibrium reasserting itself, and ultimately a good thing.

I started writing a book three years ago through which I hoped to help people see the artificial and ultimately dehumanizing landscape of corporatism on which we conduct so much of our lives. It’s not just that I saw the downturn coming—it’s that I feared it wouldn’t come quickly or clearly enough to help us wake up from the self-destructive fantasy of an eternally expanding economic frontier. The planet, and its people, were being taxed beyond their capacity to produce. Try arguing that to a banker whose livelihood is based on perpetuating that illusion, or to people whose retirement incomes depend on just one more generation falling for the scam. It’s like arguing to Brooklyn’s latest crop of brownstone buyers that they’ve invested in real estate at the very moment the whole market is about to tank. (I did; it wasn’t pretty.)

Now that the scheme we have mistaken for the real economy is collapsing under its own weight, however, it’s a whole lot easier to make these arguments. And, if anything, it’s even more important for us to come to grips with the fact that the system in peril is not a natural one, or even one that we should be attempting to revive and restore. The thing that is dying—the corporatized model of commerce—has not, nor has it ever been, supportive of the real economy. It wasn’t meant to be. And before we start lamenting its demise or, worse, spending good money after bad to resuscitate it, we had better understand what it was for, how it nearly sucked us all dry, and why we should put it out of our misery.
.........................


What always confused me was how we can constantly "grow" the economy beyond the rate of population growth. He explains it to my satisfaction.

[ixion]

1. Yes, Please. Despite the hardship it will cause

it is most necessary to return to localized economies. Out long term happiness -- and survival -- depends on it.

[burythehatchet]

2. What do you think of the concept of no a "no interest rate" system?

Which apparently is religious law for Muslims, and something that was quite puzzling to me as to why that would be a religious tenet.

[JCMach1]

4. I have a Sharia compliant VISA card

And I am not gonna give it up!

There are yearly fees and a flat penalty for not paying your balance each month (it's low) and the your total balance is lower than a regular credit card. It's actually a perfect consumer vehicle.

[burythehatchet]

5. Can you post a link to some info.? Please and thank you. :)

[JCMach1]

8. Here You go

This gives basic information... However, I'm an expat...

We understand that the complex modern financial needs of today’s world should not lead us to compromise our beliefs and values. That is why Sharjah Islamic Bank has developed a range of Islamic Credit Cards that are fully in accordance with Islamic principles.



Sharjah Islamic Bank’s Credit Cards are based on a fixed monthly fee and not on interest “Riba” and come in three distinctive types:

* Classic: reasonable fee and good spending limit
* Gold: affordable fee and high spending limit
* Platinum: competitive fee, very high spending limit and distinctive life style benefits



You now have the freedom and confidence to handle electronic transactions with the peace of mind that your card is completely Sharia’a compliant... http://www.sib.ae/en/retail-banking/products-services/islamic-cards.html

This is one concept from Islamic Law I am very bullish about! Very few people would be in credit card trouble in the US if they had Islamic Cards... Ironic, huh!

[burythehatchet]

10. You last comment is interesting. Ironic? Maybe not. Maybe it is indeed this

sort of concept that so threatens our corporate masters that we must subjugate and demonize a vast swath of the world's population. Very interesting.

[JCMach1]

13. Very threatening as it couples morality with commerce- I failed to mention that Sharia compliant

banks are expanding across the Middle East. It's a growth industry and a rejection of the 'globalized' banking culture.

Here is an article about the growth:

At a time when the conventional interest-based global financial system is in turmoil, it is a natural reaction to seek more prudent and ethical alternative systems of financial management. Islamic finance, now in its fourth contemporary decade, offers one unique alternative and is here to stay.

Global Islamic financial assets are estimated to be about $1 trillion with a potential to rise to $4 trillion by 2010. Another $1.2 trillion is estimated to be invested in commodity Murabaha contracts alone. Although these figures are still miniscule compared with the size of the conventional financial system, the growth rate of Islamic finance is phenomenal � estimated between 20 percent to 40 percent per annum, depending on asset class.

There is also strong evidence that more funds are steadily migrating to the Islamic banking system, especially in the GCC (Gulf Cooperation Council) countries and Malaysia. In the GCC countries, private liquidity is estimated at $1.6 trillion. This migration is not confined to Muslim customers. According to Al-Rajhi Bank Malaysia, 50 percent of its clients are non-Muslims. The bank not surprisingly has branches even in predominantly Chinese-populated cities such as Kuching in Malaysia.

The Islamic finance industry now offers a wide range of complex and sophisticated financial products and services. But regulators such as Muhammad Al-Jasser, the governor of the Saudi Arabian Monetary Agency (SAMA), and Zeti Akhtar Aziz, the governor of Bank Negara Malaysia, the central bank, believe that the next major challenge for the industry is its integration into the global financial system. But globalization itself brings opportunities and challenges � dynamic growth and the contagion of external shocks such as the current credit crunch. The intrinsic strengths of Shariah principles and values that underlie Islamic finance, however, provide an important underlying foundation.

Zeti also talks about the development of a New Silk Road in Islamic financial flows bridging Asia and the Middle East and extending on to Europe and beyond.

Islamic finance has a unique story to tell to the world � that its financing is essentially backed up by a range of products backed by real assets which impact on the real economy; and is a system of financial management which even the International Monetary Fund (IMF) in the past has concluded may be in a better position to absorb financial shocks than its conventional counterpart... http://www.menafn.com/qn_news_story_s.asp?StoryId=1093239989

[burythehatchet]

19. That you for that info. It is entirely new to me. I look forward to learning more.

:hi:

[JackRiddler]

26. Best argument I've heard yet in favor of conversion to Islam...

Do you have to show them you're Muslim? Otherwise, why doesn't everyone apply for this?

[JCMach1]

31. No, I am a essentially a lapsed-Unitarian (if there is such a thing)

There is no religious requirement.

[JCMach1]

32. Well keep in mind, the limits will not be super high and minimum payments

are typically limited to what it would take to pay it off in ONE YEAR.

In the old paradigm of leveraging that would be seen as limiting.

In the new climate, that seems VERY prudent.

[JCMach1]

33. Note there are also Islamic car loans, mortgages, etc.

They all operate on the same core ideas.

I also have a car loan. The payments are much less than the states and what amounts to the same as interest is only 3% with no penalty if I pay it off early as it is not really a loan. In Sharia, banks are allowed to make profit but cannot charge interest. So, the bank buys your car. Essentially, you hold it for the bank in agreement to purchase it at the date the contract is finished (i.e. in the States the loan term). Meanwhile, you have been paying them monthly on this contract.

This is rather liberating. It creates a vibrant used car market... think camel market on wheels. I actually made a profit selling my old car before I go my new one! It was small, but real (about $500).

[ixion]

6. On one hand, charging a fair interest rate isn't a bad thing, but it needs to be capped

and something under 10%.

On the other hand, banks who provide loans build their financial base on the savings of the community at large. In this case, a bank is lending the people their own money at a profit, which is a bit shady, in my opinion.

So, I guess it depends on the context. Private venture capital firms ought to be able to loan money at up to 10% interest. Local banks -- being a utility of sorts -- ought not to profit from the people it supports.

Make sense?

[burythehatchet]

9. Yes, I understand what you stated, but the author's contention is that

the mere presence of interest equates to transfer of wealth and impoverishment for "someone". The way he described it seemed perfectly logical and it seems intuitively correct. Interest is getting something for doing nothing. That seems to me to be the slippery slope which condemns all but the wealthy to a life of servitude, which is exactly the life that most of us lead (whether we know it or not). :)

[scisyhp1]

29. Why stop at the interest rate? How about a more general

"no profit" system? Let's start with healthcare, then move on to
education. After that to utilities, insurance and banking. If that works
well, other industries can also be gradually put on non-profit basis.
Getting rid of the profit motive should automatically fix most of the
root causes of economic instability.

[JCMach1]

3. too bad the administration is stil stuck on corporatism

[ixion]

7. Yes, it is...

we continue careening towards the cliff. :(

[Bosso 63]

11. "Growth for the sake of growth is the ideology of a cancer cell"

[burythehatchet]

12. That gave me a chill and a shiver.

[cali]

14. ah yes, the old kill 'em in order to save 'em, bullshit.

First of all, we aren't going back to strictly local economies unless we bomb ourselves back in time a few thousand years, or suffer a huge pandemic or asteroid strike. Secondly, there're clear inaccuracies in this ill informed piece: "What does that do to an economy? It bankrupts it. Think of it this way: A business borrows 1000 dollars from the bank to get started. In ten years, say, it is supposed to pay back 2000 to the bank. Where does the other 1000 come from? Some other business that has borrowed 1000 from the bank. For one business to pay back what it owes, another must go bankrupt. That, or borrow yet another 1000, and so on."

Really? The only way a business can pay back a bank loan is through the failure of another business? Um, no.

And the author admits that his harebrained scheme would be devastating to the poor. His words. Oh well, what's a few hundred thousand or million deaths among brave little revolutionaries?

What trash.

And no, I'm not defending the current corrupt and disgusting system.

[Name removed]

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[Name removed]

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[burythehatchet]

17. I'm gonna delete my comment and I'm going to see why the hell you keep popping

up after I have put you on Ignore at least 5 times.

[cali]

18. wah. whine on.

oh, and your putting me on ignore, will hardly effect whether or not I post in a thread of yours or respond to something you write in a post. I do it to make a point, not to engage with you.

[GoesTo11]

20. Similarly, a mass plague and death by famine would help the environment

by reducing the large human footprint on earth.

[cali]

21. exactly.

the article is all dogma, zero compassion. fuck that.

[cliffordu]

22. Let the games begin!!!

Start with Monsanto.

[burythehatchet]

25. Not sure how that relates to the OP; perhaps its sarcasm?

[NeedleCast]

23. All this let it die stuff is just fantasy for the end of days crowd

Too bad for the billions that would die or live in deplorable conditions while the economy truly died, right? Ridiculous argument that we have to let the economy die to "save future generations." Silly argument, as if the promised outcome of such a thing is a return to some idealic pre-industrial-yet-still-high-tech utopia of small communities each sustaining themselves.

[burythehatchet]

24. I had hoped that the thesis would be a bit more thought -provoking, but I understand

the reflexive desire to set-up a straw man argument. That is what we tend to do when presented with uncomfortable choices. As for the "end-of-days crowd", again, it is far easy to ignore the intellectual rigor and dismiss entire segments of thought. Perhaps the "end-of-days crowd" sees the current economic system as a guarantee that billions will die or live in deplorable conditions. Indeed, the current economic system is specifically designed to keep billions in deplorable conditions because that is the only method to inflate the wealth of the richest.

So under that framework I suppose I would include myself in the "end-of-days crowd" because I intuitively see the end-game of this system as death and destruction form many now, most, soon, and all, eventually. Perhaps that is the reason why we of the "end-of-days crowd" seek alternatives that will certainly cause massive dislocations now, with the goal of a just and civil society as the outcome.

[JackRiddler]

27. Some people clung to the Berlin wall to the very end.

[JackRiddler]

28. Perhaps it should be said: It IS dead, so it's time to stop the "heroic measures"

which are only costing us the resources to start something more humane and rational in its place.

[dionysus]

30. the author of this piece is a foolish douchebag... (not you OP)

who wants to sign up to starve to death to entertain that dumb ass scenario he proposes? any takers? ........any?

i'll say that he has a great description ofthe problem, but his "solution" is preposterous..

:eyes: