Global Neo-Serfdom , Debt Deflation, Debt Peonage, and Neofeudalism

The perfect dictatorship would have the appearance of democracy, a prison without walls in which the prisoners would not dream of escape. A system of slavery where, through consumption and entertainment, slaves would love their servitude. Welcome to The Atlantis Report . Everywhere you look, the nation-state seems to be stumbling badly. In developing countries such as Somalia, Iraq, Syria and the Democratic Republic of the Congo, internal order has broken down, as governments have lost touch with political realities on the ground. Even in the supposedly well-governed developed world, the nation-state seems to be showing its age, as evidenced by a string of financial crises stretching from Wall Street to the eurozone, as well as by the calamity of the United States’ adventurism in Iraq. Simultaneously, humanity is facing increasingly global challenges for which the concept of the nation-state is ill-equipped to provide solutions even via existing multinational institutions. These challenges are as broad as religious confrontation, global terrorism, nuclear proliferation, global warming, international immigration, pandemics and economic inequality in the West caused by an increasingly global labour market. Cue the ongoing international populist explosion – driven by economic slowdown and certainly fuelled by a sensationalist press – in which voters are rejecting traditional political leaders in favour of outsiders who delight in disrespecting and discrediting established institutions of the nation-state. A self-feeding frenzy between the new political elites, the media and the people has been initiated and is starting to devour the structure of the very nation-state to which a free press was so essential in the past. Contrary to the fevered imaginings of European federalists, however, the nation-state cannot simply be wished away as an annoying anachronism of a bygone age. Rather, the dirty little secret at the heart of our new era is that all the rising powers – be they China, India, South Africa, Indonesia or Brazil – are more sovereigntist, more nationalistic and more wedded to jealously preserving their national prerogatives than is even the United States, long the bane of post-national dreamers. Instead, it is the supposedly modern, post-nationalist European experiment that seems to be in terminal decline. Both intellectual defenders of the nation-state and its critics seem to be largely wrong at present. As of now, we live in a bewildering world, where the nation-state is both not working very well and isn’t about to be replaced. The end product of today’s Western capitalism is a neo-rentier economy—precisely what industrial capitalism and classical economists set out to replace during the Progressive Era from the late 19th to early 20th century. A financial class has usurped the role that landlords used to play—a class living off special privilege. Most economic rent is now paid out as interest. This rake-off interrupts the circular flow between production and consumption, causing economic shrinkage—a dynamic that is the opposite of industrial capitalism’s original impulse. The “miracle of compound interest,” reinforced now by fiat credit creation, is cannibalizing industrial capital as well as the returns to labor. The political thrust of industrial capitalism was toward democratic parliamentary reform to break the stranglehold of landlords on national tax systems. But today’s finance capital is inherently oligarchic. It seeks to capture the government—first and foremost the treasury, central bank, and courts—to enrich (indeed, to bail out) and untax the banking and financial sector and its major clients: real estate and monopolies. This is why financial “technocrats” (proxies and factotums for high finance) were imposed in Greece, and why Germany opposed a public referendum on the European Central Bank’s austerity program. There are two paths this new economy might take. One, more widely covered, is Darwinian. People at all ends of the socio-economic spectrum become Uberised, as both blue- and white-collar jobs are handed out piecemeal to the lowest bidder. Already, eastern European designers and Indian radiologists are undercutting their full-time peers in more developed countries this way. The labour markets start to resemble a feudal marketplace in which the lord shows up each day and says, I'll take you, and you, and you. The labour share of the pie, which has been shrinking across the developed world for the past four decades, continues to decrease. Stagnant growth and polarised politics continue. But there is another possibility. Platform technologies used by companies such as Uber could, with a few crucial tweaks, enable a return to a more be­nign, pre-industrial form of capitalism. The influence of corporate money on Congress is exacerbated by how out of touch congressmen are with the daily struggles of most Americans. The median net worth of congressmen is $913,000 as compared to $100,000 for the rest of the population. Aside from being immediately wealthy, Congressmen also weathered the tribulations of the financial crisis much better than the average American. An analysis of congressional finances by The Washington Post in October 2012 revealed that the wealthiest one-third of Congress was largely shielded from the effects of the Great Recession. While the median household net worth of the average American dropped by 39 percent between 2007 and 2010, the median wealth of congressmen rose 5 percent. It rose 14 percent for the wealthiest one-third. At a time when most people in the country are suffering, congressmen are profiting. This alone should demonstrate how out of touch our elected leaders have become. Members of Congress, entrusted to represent the best interests of the average American, instead play out a stilted, ineffective soap opera on our TV screens, complete with phony discussions of fiscal cliffs and debt ceilings which take the place of real proposals for meaningful change in the country. There is no voice for the working American in the halls of Congress, the American who was promised a life beyond taxes, debt, and unemployment. There is no voice for the peace-loving American, the American who understands that America’s military might is meant for defense of the homeland, not looking for trouble in faraway lands. There is no voice for the American who expects his representatives to abide by the Constitution, who laments the way Congress, the President, and the Supreme Court work together to take away our rights piece by piece.






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