The Road to Fascism
Dec 12, 2022 JOSEPH E. STIGLITZ
As if the economic fallout from COVID-19 and Russia's war on Ukraine wasn't difficult enough, one also must worry that the response by policymakers will make a bad situation even worse.
One must also worry that senile and stupid academics will make even shittier policy proposals or start babbling about Fascism or Nazism or the Spanish Inquisition in a manner more rabid than ever.
Growing hardship is all but assured in 2023, and it will provide even more fertile ground for dangerous demagogues.
Hardship does not provide fertile ground for shit. Was FDR a demagogue? Perhaps. But what about Stanley Baldwin in the UK? How about Daladier?
Mussolini came to power before the Great Depression. In his case, there was a Communist threat. Salazar came to power before the Depression. In his case, the Liberals had failed to provide a stable administration. Hitler only came to power because Ludendorff was too crazy and Hindenberg too old to push through the Army's maximal program though, no doubt, Germany waited till Weimar 'extend and pretend' ran out of road.
Plenty of countries have experienced great hardship and responded by becoming more democratic and pursuing economic reform more ruthlessly. Look at Estonia or Latvia. Ukraine may be said to have moved in a demagogic direction. But we can't call it Fascist.
NEW YORK – Economics has been called the dismal science,
Nobel Prize winning economists should be called demented dolts
and 2023 will vindicate that moniker. We are at the mercy of two cataclysms that are simply beyond our control. The first is the COVID-19 pandemic, which continues to threaten us with new, more deadly, contagious, or vaccine-resistant variants.
Ignore it. Let it thin out the herd till immunity is achieved.
The pandemic has been managed especially poorly by China, owing mainly to its failure to inoculate its citizens with more effective (Western-made) mRNA vaccines.
This is irrelevant. Let the thing sweep through the population. There will be negligible demographic impact and dependency ratios will improve
The second cataclysm is Russia’s war of aggression in Ukraine.
Ukraine has turned the corner. Russia's 'energy weapon' has failed. There is no reason there should be any big economic effect for other countries. Biden has always been hawkish on this issue but Biden isn't a dictator. Congress could force him to disengage.
The conflict shows no end in sight, and could escalate or produce even greater spillover effects.
This is purely a matter of choice for far away countries.
Either way, more disturbances to energy and food prices are all but assured.
Unless America decides to back China's plan. Alternatively, Biden could fight Putin with the last drop of Ukrainian blood.
And, as if these problems weren’t vexing enough, there is ample reason to worry that the response from policymakers will make a bad situation worse.
Policymakers created the bad situation. COVID should have been let rip and Ukraine should have been ignored.
Most importantly, the US Federal Reserve may raise interest rates too far and too fast.
Or they may not. But this has always been true.
Today’s inflation is largely driven by supply shortages,
because prices fall if there is over-supply.
some of which are already in the process of being resolved. Raising interest rates therefore might be counterproductive.
In which case, they can be lowered again. This really is no big deal.
It will not produce more food, oil, or gas, but it will make it more difficult to mobilize investments that would help alleviate the supply shortages.
Unless that type of investment is given a tax break. What's so fucking difficult about that?
Monetary tightening also could lead to a global slowdown.
So what? The Globe speeds up and slows down all the time. Why is this nutter babbling about Fascism? The answer is that Stiglitz's stock in trade is to scream and shit himself every time fiscal or monetary policy tightens coz Hitler is bound to come to power- right? Next stop- Auschwitz for everybody!
In fact, that outcome is highly anticipated, and some commentators, having convinced themselves that combating inflation requires economic pain,
as opposed to the Government just mailing everybody a check for a million dollars every month
have been effectively cheering on the recession. The quicker and deeper, the better, they argue. They seem not to have considered that the cure may be worse than the disease.
Because Hitler and his Nazi hordes will rise from the dead. Also, the Spanish Inquisition will start burning heretics all over the place.
The global tremors from the Fed’s tightening could already be felt heading into winter.
Did this cause Biden to grow a Hitler 'tache? Yes. He launched a night of the long knives. The American army has now sworn a personal oath of obedience to him.
The United States is engaged in a twenty-first-century beggar-thy-neighbor policy.
But China is increasingly in the driver's seat.
While a stronger dollar tempers inflation in the US, it does so by weakening other currencies and increasing inflation elsewhere
Which is why other countries need to decouple from American financial markets. Globalization can't be led by a senile Uncle Sam.
. To mitigate these foreign-exchange effects, even countries with weak economies are being forced to raise interest rates, which is weakening their economies further.
Weakness weakens. That is Stiglitz's big discovery.
Higher interest rates, depreciated currencies, and a global slowdown have already pushed dozens of countries to the edge of default.
At which edge they have already been and will be again.
Higher interest rates and energy prices will also push many firms toward bankruptcy, too.
Also people will DIE. Why has the Government not banned Death?
There have already been some dramatic examples of this, as with the now-nationalized German utility Uniper.
Which has led to Germans putting on brown shirts and invading Poland- right?
And even if companies don’t seek bankruptcy protection, both firms and households will feel the stress of tighter financial and credit conditions. Not surprisingly, 14 years of ultra-low interest rates have left many countries, firms, and households overindebted.
Weimar Germany was in debt. Then Hitler came to power. OMG! This proves that everybody with a Student Loan is gonna turn into a Nazi!
The past year’s massive changes in interest rates and exchange rates imply multiple hidden risks –
like putting Truss & Kwarteng in Number 10 and 11 respectively
as demonstrated by the near-collapse of British pension funds in late September
because Truss & Kwarteng were as stupid as shit
and early October. Mismatches of maturities and exchange rates are a hallmark of
emerging economies not
under-regulated economies,
The fact is, if the regulator is as stupid as fuck- or the regulator is overriden by a stupid as fuck Chancellor, you will get big mismatches and volatility will go through the roof
and they have become even more prevalent with the growth of non-transparent derivatives
Everything should be regulated- OTC or Cash settled derivatives as well as moustaches. Otherwise they could turn into Hitler taches and then Spanish Inquisition will start burning heretics- right?
These economic travails will, of course, fall hardest on the most vulnerable countries, providing even more fertile ground for populist demagogues to sow the seeds of resentment and discontent.
Stiglitz sided with Syriza- populist demagogues who took stoked up 'resentment and discontent' in Greece. Where are they now? The plain fact is demagoguery can't magically turn into Fascism. It can, however, get the order of the boot at the ballot box.
There was a global sigh of relief when Luiz Inácio Lula da Silva
a demagogue jailed for corruption- which is what enabled Bolsonaro to win.
defeated Jair Bolsonaro in Brazil’s presidential election. But let us not forget that Bolsonaro got almost 50% of the votes and still controls Brazil’s Congress.
So, Brazil is like Biden's America. This proves both countries will soon turn Fascist- right?
Across every dimension, including the economy, the greatest threat to well-being today is political.
And the greatest threat to the political the economic or military. And the greatest threat to the economic or military is the danger that people will quit work and run away.
Over half the world’s population lives under authoritarian regime
As has always been the case.
Even in the US, one of the two major parties has become a personality cult that increasingly rejects democracy and continues to lie about the outcome of the 2020 election. Its modus operandi is to attack the press, science, and institutions of higher learning, while pumping as much mis- and disinformation into the culture as it can.
Trump is a better Stiglitz than Stiglitz. Sad.
The aim, apparently, is to roll back much of the progress of the past 250 years.
In which case we don't have to worry about Fascist Brown Shirts because we will be too busy coping with King George's Redcoats.
Gone is the optimism that prevailed at the end of the Cold War, when Francis Fukuyama could herald “the end of history,” by which he meant the disappearance of any serious challenger to the liberal-democratic model.
Back then, peeps thought Stiglitz was the shit. But, by the beginning of this Century, the man was known to be shit.
To be sure, there is still a positive agenda that could forestall a descent into atavism and despair.
That agenda involves ignoring shitheads who write for Project Syndicate.
But in many countries, political polarization and gridlock have pushed such an agenda out of reach.
There is genuine preference diversity behind such polarization. Some people want to own guns. Others would feel safer if nobody got to own guns.
With better-functioning political systems, we could have moved much faster to increase production and supply, mitigating the inflationary pressures our economies now confront.
No. People have to work harder to increase supply. A better functioning political system has no magical effect on the incentive matrix. Indeed, a better functioning democratic political system could reduce aggregate supply something fierce. Why keep up with the Joneses if the Joneses can be persuaded to chill?
After a half-century of telling farmers not to produce as much as they could, both Europe and the US could have told them to produce more.
This won't last. Stiglitz gets that- right?
The US could have provided childcare – so that more women could enter the labor force, alleviating the alleged labor shortages – and Europe could have moved more quickly to reform its energy markets and prevent a spike in electricity prices.
Also the US could have adopted assless chaps as its national costume while Europe could have moved more quickly to sucking cock at truck stops.
Countries around the world could have levied windfall-profit taxes
and pissed that revenue against the wall
in ways that might actually have encouraged investment
in shitty green energy projects which never come on line- right?
and tempered prices,
till the country went off a fiscal cliff.
using the proceeds to protect the vulnerable
in which case everybody would decide to be 'vulnerable'- especially billionaires.
and to make public investments in economic resilience.
coz 'public investments' aren't made by stupid politicians- right?
As an international community, we could have adopted the COVID-19 intellectual-property waiver, thereby reducing the magnitude of vaccine apartheid and the resentment that it fuels, as well as mitigating the risk of dangerous new mutations.
Why not just ban R&D of every sort?
All told, an optimist would say that our glass is about one-eighth full.
No. An optimist would say Project Syndicate is shit through and through.
A select few countries have made some progress on this agenda, and for that we should be grateful. But almost 80 years after Friedrich von Hayek wrote The Road to Serfdom, we are still living with the legacy of the extremist policies that he and Milton Friedman pushed into the mainstream.
Hayek and Friedman had no power. Like Stiglitz, they were mere academics. Voters didn't want to finance stupid Left-Liberal politicians. They prevailed in richer countries while poorer countries had to do market-based reform when they could no longer beg or borrow to finance their dual deficits.
Those ideas have put us on a truly dangerous course: the road to a twenty-first-century version of fascism.
No. Stiglitz idea was that Suharto should have been given more and more money to keep his Fascist style dictatorship. Fortunately, Stiglitz was overruled and the IMF's tough love put Indonesia on the path to reform, democracy, and prosperity.
Fascism and Communism and other totalitarian systems incarnate Stiglitz's fundamental misology which holds that virtue signaling politicians make better decisions than free markets which coordinate the self-interested actions of producers and consumers.
Consider the following report on what Stiglitz was getting up to just 15 years ago-
Caracas, October 11, 2007 (venezuelanalysis.com) - Nobel Prize winning economist and former vice-president of the World Bank, Joseph Stiglitz, praised Venezuela's economic growth and "positive policies in health and education" during a visit to Caracas on Wednesday.
This cunt was a cheerleader for Chavez. How much more Fascist can you get?
"Venezuela's economic growth has been very impressive in the last few years," Stiglitz said during his speech at a forum on Strategies for Emerging Markets sponsored by the Bank of Venezuela.
Venezuela, the fourth largest exporter of crude oil to the United States, has experienced the highest economic growth rate in Latin America in recent years, with fifteen successive quarters of expansion and looks set to close the year with 8-9% growth. Despite the high rate of growth, high public spending and increased consumer demand have contributed to inflationary pressures, pushing inflation up to 15.3%, also the highest in Latin America. However, Stiglitz, who won the Nobel Prize for economics in 2001, argued that relatively high inflation isn't necessarily harmful to the economy.
Venezuelans should be grateful for the gift of hyperinflation.
He added that while Venezuela's economic growth has largely been driven by high oil prices, unlike other oil producing countries, Venezuela has taken advantage of the boom in world oil prices to implement policies that benefit its citizens and promote economic development.
We should use windfall taxes to 'promote economic development' Chavez-style- right?
"Venezuelan President Hugo Chavez appears to have had success in bringing health and education to the people in the poor neighborhoods of Caracas, to those who previously saw few benefits of the countries oil wealth," he said.
Those people have run away.
In his latest book "Making Globalization Work," Stiglitz argues that left governments such as in Venezuela, "have frequently been castigated and called ‘populist' because they promote the distribution of benefits of education and health to the poor."
Chavez was a populist demagogue. Stiglitz thought the sun shone out of his arse. This is the cunt Project Syndicate promotes so as to call Hayek and Friedman 'extremist'.
Trump did not really endanger American democracy. Chavez and Maduro destroyed it completely. Stiglitz was on the wrong side on this.
"It is not only important to have sustainable growth," Stiglitz continued during his speech, "but to ensure the best distribution of economic growth, for the benefit of all citizens."
Stiglitz is saying Fascism is better than Freedom.
Although Stiglitz praised Venezuela's "positive policies" in areas of health and education and policies to promote economic diversification, he assured that Venezuela still faces the challenge of overcoming structural problems associated with an economy overwhelmingly geared towards oil production.
which needed to maintain that infrastructure and retain the professionals running it. Otherwise there would be no money for welfare schemes.
In terms of economic development Stiglitz argued it was not good for the Central Bank to have "excessive" autonomy.
The fucker hates Freedom of any sort.
Chavez's proposed constitutional reforms, if approved in December, will remove the autonomy of the country's Central Bank.
Guess what happened next.
However, Stiglitz claimed, developing nations must strike a balance between public and private control of the market.
"The key to success is to find the correct equilibrium between the private sector and the government, which is different for each nation," he said.
That equilibrium must be more in the direction of the private sector if a maniac is running the public sector.
Stiglitz also welcomed Venezuela's initiative to create the Bank of the South; due to be founded in Caracas on November 3, saying it would benefit the countries of South America and boost development.
Governments pledged money to the Bank but it got nothing and thus has never existed save on paper.
"One of the advantages of having a Bank of the South is that it would reflect the perspectives of those in the South," said Stiglitz,
Clearly, that 'perspective' didn't involve actually putting any money into it.
whereas, he argued, the World Bank and International Monetary Fund often impose conditions that "hinder the development effectiveness
of fraud and wholesale looting of national treasuries by a kleptocracy.
Stiglitz also criticized the "Washington Consensus" of implementing neo-liberal policies in Latin America, in particular the US free trade agreements with Colombia and other countries, saying they failed to bring benefits to the peoples of those countries.
Yet, Venezuelans would have to flee to 'neo-liberal' countries so as to work and feed themselves.
The Washington Consensus "is undermining the Andean cooperation,
which was based on fraud or fantasy
and it is part of the American strategy of divide and conquer, a strategy trying to get as much of the benefits for American companies," and little for developing countries, he said.
This is the paranoid message of every Fascist Messiah.
Stiglitz also met with Venezuelan President Hugo Chavez in Miraflores, where they exchanged points of view on the global economic situation, economic indicators and the behavior of world markets.
Chavez taught Stiglitz some basic economics. He was very grateful. Did he express his gratitude by giving Chavez a rim-job? I assume so. Nothing less would do.
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