By Mark Taliano
During the Second World War in Germany, Hitler’s Nazis made the laws, so they didn’t break the laws. Their systematic murder of 11 million people was done in a very rational fashion. It was a well-administered, rationally conducted holocaust.
From a military point of view, though, it was bereft of common sense. The victims could have been used to serve the war effort. Even more important, of course, is that the holocaust serves as an icon of horrific evil.
Rationality, argues John Ralston Saul, in Voltaire’s Bastards, is indifferent to common sense or morality. Furthermore, he argues, technocrats fall into this same trap. They have a narrow band of intelligence which is divorced from reality, from common sense, and from morality. Technocrats love power, they are obsessed with structure, and they believe in certain “absolute truths”. This is their downfall in the real world which has its own logic.
The economic theory of neoliberalism, for example, is seen as an absolute truth, even when hallmarks of the theory, such as unregulated financial speculation, create market crashes that tear at the fabric of civilized society. But everything can be rationalized by technocrats whose world-view does not include common sense.
Since the 1980’s, with the “liberalization” of markets (neoliberalism), stock market speculation has become more important than investing in “enterprises” such as manufacturing, trains, canals and so on. Even worse, financial firms such as Goldman Sachs speculate on commodities , such as food, for profit. Short term shareholder profits can raise food prices and contribute to food scarcity for millions.
At the very least, speculation in food commodities should be illegal. The legislation which was crafted over the years to legalize trading such as commodities, derivatives, hedge funds is responsible in large part for the crash of the financial system in 2008, yet it still has not been altered significantly. The alternate narrative here, the common sense, moral solution, would be to ban commodity trading in agricultural products, as some banks in Europe on starting to do.
A Financial Transaction Tax (Robin Hood Tax) would also help to regulate speculative market transactions. This tax is gaining widespread approval in Europe.
Likewise, the assault on the public, social sphere, including pensions and hospitals, lacks common sense.
An overview of Chapter 6 of Bruce Livesey’s Thieves Of Bay Street , shows that the privatization of pension plans basically penalizes the 99%, while serving the short term interests of the 1%. According to the University of Toronto’s Rotman International Centre for Pension Management, “Pension plans generate more returns for investors than mutual funds – 3.8% more on average.” One reason for improved earnings by pension plans, Livesey explains, is that mutual funds charge such high fees, especially in Canada. This means that the Harper Government’s Pooled Registered Pension Plans, to be run by banks, mutual funds, and the insurance industry, will be a disservice to retirees.
Public-private financing schemes are also a rip-off for the public. A study of 28 Ontario P3 projects worth over $7 billion found that P3 s cost, on average, 16% more than conventionally run projects. One reason for this is that private borrowers pay higher interest rates than their government counterparts (plus lawyers and accountants cost another 3%.).
Economically, these privatization schemes lack common sense. The pauperization of large segments of the population, and the transfer of debt to the future, means that more people can’t pay for products, which means the economy slows. The 1% will be alright if they get bailed out by the public, but if they don’t get the bailout to which they are now so accustomed, they too will crash.
Metrics for the real world economy, divorced as it is from dogmatic policy-making, are increasingly negative. Corporate empowerment deals that send raw materials off-shore, for example, negatively impact other segments of the economy. Consider these OECD metrics for innovation and global competitiveness. These negative metrics should be red flags to stimulate different economic policies, but, consistent with technocratic rule, this is not happening.
Arguably the most important threat facing the world right now is human-caused global warming. Common sense dictates that this issue be identified and addressed, but the technocrats’ obsession with an economic plan is divorced from the reality of increasing planetary disasters.
“Even when surrounded by self-generated disaster”, argues Saul, “(the technocrat) believes that he is right.” The melting Arctic ice cap, and the devastating droughts and extreme weather currently facing the planet are seen by technocrats as being divorced from their policies. This false reasoning works at cross-purposes to addressing the real threat of AGW and the need to transition to a low carbon economy, the technology of which is already developed (elsewhere for the most part), and is improving daily.
Notwithstanding the moral and common sense failings of the tar sands industry, even the economic management of this resource is a failure. A common sense alternative is to slow development and to create a strong Heritage/Sovereign fund, as a method of counterbalancing inflation, and saving for economic priorities. But these alternatives are not accepted because they don’t fit into the Harper government’s rationale for resource exploitation.
The failure of the Harper regime’s dogma to address real world problems is, in turn, leading to more bullying, secrecy, and anti-democratic practices to counter the growing opposition. Instead of embracing better alternatives though, the government continues down the same failing path.
As the insular logic of unfettered capitalism continues to clash with the logic of the real world, our government remains willfully blind to the lessons of history and science. The current regime’s penchant for suppressing and ignoring these lessons is not serving us well.
Mark Taliano is a Niagara resident and a regular contributory of news and commentary to Niagara At Large.
(Niagara At Large invites you to share your views about this post. Note that NAL only publishes comments by individuals who also share their first and last names.)