Taking on the currency cranks

[love detective]

I am fully aware that the term capitalism became widely used as a result of M and E's writings, and what a cul-de-sac that has been!

If only anti-capitalists could get over this ruddy obsession with capitalism

 

[kenny g]

You know nothing of my life and my political relevance so I can only imagine that you're projecting your own inadequacies, presumably social ones, onto me.

E2A: isms maaan, don't label me dude!

"Projecting" - you appear to be more than happy to throw vitriol around. And yes, I do think chucking labels at someone is a pretty poor approach to an argument. But heh, you have read most of Marx and "come to grips" with it, so we better believe your analysis heh? Pity that it comes across as someone trying to justify their reading rather than find any kind of solution.

 

[kenny g]

If only anti-capitalists could get over this ruddy obsession with capitalism

Pretty much proves my point. The high point of "anti-capitalism" was June 18th 1999, and that was hi-jacked by trots within weeks.

In any effective war, it isn't a good idea to allow yourself to be defined by what you are against.

 

[love detective]

As an aside, do you know how many times Capitalism is mentioned in the communist manifesto? The answer is none. Engels refers to it once in the intro of 1893. The word capitalist does arise and is used to refer to the class of individuals, the bourgeoisie. The leftist waffle of the kind espoused by Love Detective is not the source of a solution for the world, but is rather the drifting stench from the previous century's leftist failures.

out of interest what was this leftist waffle i was apparently espousing?

 

[love detective]

In any effective war, it isn't a good idea to allow yourself to be defined by what you are against.

true - when you're at war, the last thing you want to be doing is worrying and fussing about your enemy and what they're upto

 

[SpineyNorman]

All begs the question tho - most people are gonna want to vomit when they hear the kind of language LD (and you, and me for that matter) generally use when discussing these things. Hegemonic discourse? Fuck off.

Well quite. I don't use that kind of language when I'm talking to the lads in the pub!

But that's no reason not to understand it yourself is it? I've a fair bit of faith in the intellectual capabilities of ordinary people and my experiences of everyday conversations with people who aren't politics geeks like me suggests that although they (probably quite sensibly ) can't be arsed to spend the amount of time reading that I do they are smart enough to understand the conclusions. And if those conclusions are grounded in a serious analysis (not post-modernist claptrap kenny seems so keen on) it's fairly easy to back them up when people disagree. It also helps when we're trying to work out what's going to happen in the future, which makes it easier to work out what kind of tasks we should prioritise.

But for anyone who wants to understand the way society, and especially the economy, works and how to best go about changing it then an understanding of Marx is absolutely indespensible IMO.

 

[SpineyNorman]

So we are agreed that in order to understand the mutually re-enforcing links between meaningful revolutionary discourse and real material power relations you do not need to have read the complete works of Marx. Nor, I would suggest, do you have to express your political beliefs in purely marxian terms.

I think you misunderstand me. I was not suggesting that the volumes of Capital are a cul-de-sac or irrelevant, rather that the word capitalism is. I don't think it particularly helps us understand the real nub of the problem. Marx's earlier emphasis on the Bourgoisie and Capitalists is far more relevant to the real issues of control, exploitation and domination, both of the planet and of us.

It is interesting that I have moved from being SPGBer to a post-modernist in your eyes. I await the next pigeon hole.

It's possible to be both. And if someone starts claiming that discourse is more important for social power than material factors (eg economic realtions) then it's fair to say they're putting forward a post-modernist view.

What's wrong with the term capitalism? It's hardly Marxist jargon is it? Everyone I know has a good idea what it is (and most think it stinks too).

And I don't even know what this bit: "Marx's earlier emphasis on the Bourgoisie and Capitalists is far more relevant to the real issues of control, exploitation and domination, both of the planet and of us." is supposed to mean. How can you speak of capitalists without speaking of capitalism?

You're a bit all over the place if you ask me.

 

[SpineyNorman]

One doesn't vomit when learned people are talking about important things like Marx and Capitalism, comrade. But one might move swiftly on, on account of being excluded.

I wouldn't use such terms in everyday conversation but when someone's trying to rubbish Marx's works is it not safe to assume they'd understand some of the key concepts?

 

[SpineyNorman]

"Projecting" - you appear to be more than happy to throw vitriol around.

*cough*

you are about as politically relevant as any piss stained bloke who has wasted their life studying racing form.

And yes, I do think chucking labels at someone is a pretty poor approach to an argument. But heh, you have read most of Marx and "come to grips" with it, so we better believe your analysis heh? Pity that it comes across as someone trying to justify their reading rather than find any kind of solution.

When did I say I'd read "most of Marx"? I haven't. And better to justify reading than wilful ignorance.

 

[cesare]

I wouldn't use such terms in everyday conversation but when someone's trying to rubbish Marx's works is it not safe to assume they'd understand some of the key concepts?

Aye. But other people are reading too, so using accessible language is more likely to encourage other people to join in. That said, I've seen far worse

 

[SpineyNorman]

Aye. But other people are reading too, so using accessible language is more likely to encourage other people to join in. That said, I've seen far worse

Point taken comrade.

Pretty much proves my point. The high point of "anti-capitalism" was June 18th 1999, and that was hi-jacked by trots within weeks.

In any effective war, it isn't a good idea to allow yourself to be defined by what you are against.

Fuck the fuck off you cunting cunt. /accessible

 

[cesare]

Point taken comrade.



Fuck the fuck off you cunting cunt. /accessible

 

[cesare]

I've only ever been to one political meeting, and the ICC turned up. Never again

Edit. I lied, I've just remembered another one which was totally fine, tbf.

 

[kenny g]

You're the one displaying ignorance. Nobody said the Manifesto was anything but a work of brilliance. But it's not, and can't be, read as a substitute for the real hard task of getting to grips with their works as a whole. For a start the term capitalism itself became widely used as a result of Marx and Engels' writings. And if you'd read Marx's more historical works - the 18th Brumaire, Class struggles in France etc. and Engels work on the state you'd see that the reason why they considered an analysis of the relations of production so vital was precisely because they rightly understood their importance with regards to power dynamics. Interestingly, some accounts claim that Marx was wanting to study anthropology once all 7 planned volumes of Capital were finished, which suggests that the vulgar base/superstructure interpretation is a nonsense and that he was well aware of the way cultural and linguistic factors could be put to use both in maintaining and changing the status quo.

Maybe if you'd not been so lazy and actually bothered to read it rather than dismiss it you'd have realised this.

*cough*

When did I say I'd read "most of Marx"? I haven't. And better to justify reading than wilful ignorance.

When did I justify wilful ignorance? I haven't. I just said that I thought I had used my time more productively by reading a synopsis of Marx's economic theory,( I now recall getting through a few extracts and attending a uni course) rather than ploughing through Capital. My main interest in his thoughts at the time I looked into it was the Materialist Conception of History and Gerry Cohen's work on it. Apparently this is all evidence that I am an SPGB post modernist lazy pig ignorant etc.

The argument on here that Marx is great because it gives you the basis to win any argument is probably the reason why "Marxists", especially of the trot variety, are quite often best avoided. They are all too often boring know it alls who prefer to speak than to listen. In my vast experience of political discourse SPGB meetings can most certainly hold their heads high in this respect. Decent people providing space for workers to actually work through their ideas.

 

[kenny g]

true - when you're at war, the last thing you want to be doing is worrying and fussing about your enemy and what they're upto

If you know your enemy is fussing about what you are up to then you can start to determine their actions by your own.

Intel is necessary but not sufficient. It is certainly NOT a good idea to think that in order to defeat the enemy you must fully understand it. That is why Marx's reference to Capitalists and their synonym the Bourgeoisie as being the object of class struggle, rather than Capitalism, in the Communist Manifesto is so important. He identifies the enemy.

It is his later work which is so remarkably ineffective in terms of being a weapon of change, however well it may describe the exploitation of labour in economic terms. Many "Marxists" assume that once people understand they are exploited they will want to overthrow the system of exploitation which is termed Capitalism. Therefore, these Marxists say, revolutionaries just need to educate workers as to the exploitative nature of capitalism and a revolutionary consciousness will follow. It is a tactic that has been proved wrong time and time again. Any number of Capital reading groups have just led to any number of know-it-all bores. Knowledge of exploitation doesn't cause a revolution.

 

[love detective]

I agree with your criticisms of Marxists, how much of this blame can be laid at Marx's door however is debatable

Anyroads, the majority of these 'Marxists' of which you speak are more likely to have read the Communist Manifesto and not Capital (i would imagine something like around 90% of 'Marxists' haven't read Capital, yet 90% of them would have read the Communist Manifesto), so that puts your argument that the Communist Manifesto is a more effective 'weapon of change' than Capital on very shaky ground, given how ineffective Marxists and Marxism have been over the last hundred and fifty years in effecting change

You are right though, knowledge of exploitation doesn't cause a revolution - not sure who here has argued that it does though. You however seemed to think that knowledge, theory or analysis was not only not sufficient but not even necessary either - which is somewhat in contradiction with how Marx saw things around the time he helped to write the Communist Manifesto

The weapon of criticism cannot, of course, replace criticism of the weapon, material force must be overthrown by material force; but theory also becomes a material force as soon as it has gripped the masses. Theory is capable of gripping the masses as soon as it demonstrates ad hominem, and it demonstrates ad hominem as soon as it becomes radical. To be radical is to grasp the root of the matter.

As philosophy finds its material weapon in the proletariat, so the proletariat finds its spiritual weapon in philosophy. And once the lightning of thought has squarely struck this ingenuous soil of the people, the emancipation of the Germans into men will be accomplished.

 

[SpineyNorman]

When did I justify wilful ignorance? I haven't. I just said that I thought I had used my time more productively by reading a synopsis of Marx's economic theory,( I now recall getting through a few extracts and attending a uni course) rather than ploughing through Capital. My main interest in his thoughts at the time I looked into it was the Materialist Conception of History and Gerry Cohen's work on it. Apparently this is all evidence that I am an SPGB post modernist lazy pig ignorant etc.

The argument on here that Marx is great because it gives you the basis to win any argument is probably the reason why "Marxists", especially of the trot variety, are quite often best avoided. They are all too often boring know it alls who prefer to speak than to listen. In my vast experience of political discourse SPGB meetings can most certainly hold their heads high in this respect. Decent people providing space for workers to actually work through their ideas.

The evidence that you're SPGB came from your admission that you were some time ago - now you say you're not and I accept that. The evidence for your post-modernism is your elevation of the importance of discourse to levels that it really doesn't justify. And it's nothing to do with winning an argument - unless we understand a problem we cannot change it. Fires are hot. So what we need to do to stop fires is to make stuff colder - that's the kind of solution your vulgar surface level analysis would bring you to. Someone who looks below the surface sees that fire requires oxygen, fuel and ignition and takes one of these out of the equation. And when I'm discussing politics with people I never use jargon when there's a "normal" word or set of words I can use instead. Marx and Marxism, for me, is about me working out what's going on in the world. Without this I can't ever hope to address the problems I see.

And this all started, if you remember, with you claiming that Capital wasn't worth reading and that you could get all you needed from the Manifesto. So stop being silly and trying to misrepresent people.

 

[Jazzz]

it's created through the act of circulation, a process that by definition can not be done by one party in isolation

No, this is not really correct. The money is created at the point the loans are made. It exists in the borrower's account before it travels anywhere.

as i said above

there's as much truth in the statement that:-

'borrowers create money out of thin air'

as there is in the statement that:-

'commercial banks create money out of thin air'

Agreed! As I have previously said, money is simply an expression of debt between one party and another. And amazingly it is actually the borrower who really creates the money when he/she signs the promissory note for the loan contract.

 

[Jazzz]

That may be your view but you can't call "Paul Tucker, Bank of England Executive Director and member of the Monetary Policy Committee" to the witness box to testify in your favour. What he said in that speech was:
This is saying that in the short run they can expand credit at will, but only if they first "lever up their balance sheets", i.e if they borrow more. It is not saying that they can expand credit at will just by typing in some numbers. Don't you understand the meaning of "lever up"?

When a bank makes a loan, both its assets and liabilities increase by the amount of the loan. This is 'levering up' the balance sheet. It is simply bookkeeping entries.

from your link:

"Subject only but crucially to confidence in their soundness, banks extend credit by simply increasing the borrowing customer’s current account, which can be paid away to wherever the borrower wants by the bank ‘writing a cheque on itself’. That is, banks extend credit by creating money. This ‘money creation’ process is constrained: by their need to manage the liquidity risk – from the withdrawal of deposits and the drawdown of backup lines – to which it exposes them.15 Adequate capital and liquidity, including for stressed circumstances, are the essential ingredients for maintaining confidence.16" "

As I said, this translates as "banks create money out of thin air to the extent that they can get away with it"

 

[TruXta]

Actually this quote of Marx'

theory also becomes a material force as soon as it has gripped the masses. Theory is capable of gripping the masses as soon as it demonstrates ad hominem, and it demonstrates ad hominem as soon as it becomes radical. To be radical is to grasp the root of the matter.

could easily be used to argue that pace kenny we should and could start with a critique of discourse, of the language used to divide and conquer, and then proceed from that to show how that language is rooted in social and material conditions that reproduce these selfsame divisions and subjugations. Like in that other thread about the perils of giving/receiving compliments - would you rather start with an examination of the language/discourse or would you jump straight into an "explanation" of why and how these patterns of language and interaction have come to exert such a hold?

 

[Jean-Luc]

When a bank makes a loan, both its assets and liabilities increase by the amount of the loan. This is 'levering up' the balance sheet. It is simply bookkeeping entries.

Once again, that is your interpretation but it is not Paul Tucker's. In that speech he says:

Well, much that I have said about banks -- their capacity, in the short run, to lever up their balance sheets and expand credit at will ...

So, he's referring to something he had said earlier in his speech. What he was referring to were some views expressed by another economist:

Hyun Shin has argued that balance sheet management of this kind amplifies the credit cycle. That sounds like the 'financial accelerator' model, except that Shin's position is that the outcomes can exceed those warranted by fundamentals. His argument is that in the upswing of a business cycle, the rise in asset values increases the accounting net worth of banks and other intermediaries, enabling them to leverage up their balance sheets. This expands credit; and increases the liquidity in capital markets, reducing liquidity premia embodied in asset prices; and so on. And when the music stops, the process can be reversed as falls in asset values, leverage and liquidity feed on each other.

I would have thought that this was clear enough: because in a boom the value of their assets increases this means banks can both borrow and lend more (and that in a slump it's the other way round). It's not at all a case of banks creating money out of thin air but of them being able to borrow more from which to lend.

from your link:
"Subject only but crucially to confidence in their soundness, banks extend credit by simply increasing the borrowing customer’s current account, which can be paid away to wherever the borrower wants by the bank ‘writing a cheque on itself’. That is, banks extend credit by creating money. This ‘money creation’ process is constrained: by their need to manage the liquidity risk – from the withdrawal of deposits and the drawdown of backup lines – to which it exposes them.15 Adequate capital and liquidity, including for stressed circumstances, are the essential ingredients for maintaining confidence.16" "

As I said, this translates as "banks create money out of thin air to the extent that they can get away with it"

Here Tucker is merely saying that banks create money when they make a loan, i.e. that their IOUs (to members of the public, firms and governments) function as money in that they are accepted as means of payment. Saying that bank IOUs are money (or, for the purists, quasi-money) does not imply that they create the money they lend out of thin air. In fact it is not saying anything about where the money for the loan comes from. It applies equally when they are lending money they already have (from outside deposits and what they themselves have borrowed). And, presumably, would apply to bank loans if your so-called "100% reserve banking" was to ever come in.

 

[love detective]

we should and could start with a critique of discourse, of the language used to divide and conquer, and then proceed from that to show how that language is rooted in social and material conditions that reproduce these selfsame divisions and subjugations

would you rather start with an examination of the language/discourse or would you jump straight into an "explanation" of why and how these patterns of language and interaction have come to exert such a hold?

It's almost as if we need some kind of methodological approach which starts with an appropriation and examination of the concrete and surface level detail as the starting point.

Then moves behind those empirical/phenomenal like surface forms to examine and develop a hypothesis about the deeper roots & conditions which not only give rise to those surface like forms, but point to why those surface forms must appear in the way that they do

And then some kind of bundling together of that essence & appearance, in some kind of 'concept of reality' which in turn can then be validated to see if it's of any analytical worth by an ongoing testing of the results of that concept against the kind of concrete detail that gave us our starting point.

If only some kind of diagram encapsulated this process

Arguments about diagrams aside, I agree with what you say above about the approach, but I think you'll find the Kenny is arguing against such an approach. He thinks an understanding of what your're fighting against is not only not sufficient, not even not necessary, but actually detrimental to effectively fighting against it.

As per Spiney Norman's analogy Kenny (and Jazz) seems to be happy to go around trying to put out fires by trying to make them colder - an understanding of where the hotness of that fire comes from could only get in the way of putting out these fires in his mind.

Which is somewhat Ironic as both Kenny and Jazz display exactly the same approach to this, yet are on opposing sides of the debate talked about in the OP

 

[kenny g]

As per Spiney Norman's analogy Kenny (and Jazz) seems to be happy to go around trying to put out fires by trying to make them colder - an understanding of where the hotness of that fire comes from could only get in the way of putting out these fires in his mind.

People were, and are, very successfully extinguishing fires without having a full knowledge of the physics involved. If people had waited until they understood the causes of fire before putting flames out I expect the whole world would have burnt. Plenty of other analogies in medical science and germ theories.

 

[TruXta]

It's almost as if we need some kind of methodological approach which starts with an appropriation and examination of the concrete and surface level detail as the starting point.

Then moves behind those empirical/phenomenal like surface forms to examine and develop a hypothesis about the deeper roots & conditions which not only give rise to those surface like forms, but point to why those surface forms must appear in the way that they do

And then some kind of bundling together of that essence & appearance, in some kind of 'concept of reality' which in turn can then be validated to see if it's of any analytical worth by an ongoing testing of the results of that concept against the kind of concrete detail that gave us our starting point.

If only some kind of diagram encapsulated this process

Arguments about diagrams aside, I agree with what you say above about the approach, but I think you'll find the Kenny is arguing against such an approach. He thinks an understanding of what your're fighting against is not only not sufficient, not even not necessary, but actually detrimental to effectively fighting against it.

As per Spiney Norman's analogy Kenny (and Jazz) seems to be happy to go around trying to put out fires by trying to make them colder - an understanding of where the hotness of that fire comes from could only get in the way of putting out these fires in his mind.

Which is somewhat Ironic as both Kenny and Jazz display exactly the same approach to this, yet are on opposing sides of the debate talked about in the OP

Fuck, you're in love with that diagram aren't you?

 

[cesare]

Jazzz, is this meeting being publicised in your circles? It could be very entertaining for audience.

 

[love detective]

Fuck, you're in love with that diagram aren't you?

 

[Jean-Luc]

Jazzz, is this meeting being publicised in your circles? It could be very entertaining for audience.

It does seem to be:

http://www.meetup.com/Positive-Money/events/79704292/

http://www.positivemoney.org.uk/2012/08/banking-reform-or-abolition-of-capitalism-central-london/

There's also this from here:

AB: The left appear to be wilfully blind about this most important of issues; according to the Socialist Party of Great Britain (in an attack on the Social Credit proposals of Major Douglas): “[banks] are essentially only financial intermediaries, borrowing money at one rate of interest from people with cash to spare and lending this at a higher rate to those needing money to spend or invest, their profits coming from the difference between the two interest rates”. As you pointed out in your critique of Bob Diamond last year, this is not true. Worse than that, it is an outright lie, because now it is generally accepted that banks do create credit ex nihilo. Why do so-called socialist organisations peddle such lies and toe the banks' line?
BD: It's the ideological attachment to getting rid of capitalism that blinds them to seeing how things really work.

​

 

[SpineyNorman]

People were, and are, very successfully extinguishing fires without having a full knowledge of the physics involved. If people had waited until they understood the causes of fire before putting flames out I expect the whole world would have burnt. Plenty of other analogies in medical science and germ theories.

Jesus. They succeeded in putting out those fires first, in primitive times, through observation and trial and error. And these days people can put out fires because people who do understand the physics have shown them. What they didn't do was see it was hot and try and cool it down with a fucking fridge. You appear now to be arguing against the scientific method.

 

[cesare]

It does seem to be:

http://www.meetup.com/Positive-Money/events/79704292/

http://www.positivemoney.org.uk/2012/08/banking-reform-or-abolition-of-capitalism-central-london/

There's also this from here:

​

Thanks Jean-Luc, that's helpful. I was wondering about Jazzz's fellow conspiracy theorists as well.

 

[kenny g]

Jesus. They succeeded in putting out those fires first, in primitive times, through observation and trial and error. And these days people can put out fires because people who do understand the physics have shown them. What they didn't do was see it was hot and try and cool it down with a fucking fridge. You appear now to be arguing against the scientific method.

You are correct that learning to put fires out may well have come about through trial and error. However, it would be surprising if the process of trial and error involved any knowledge of oxygen or the physics of combustion. It may have involved a mirad of theories about gods, stars, or perhaps no great over-arching theories at all. Solutions can be arrived at by trial and error without knowledge of the underlying physics, that is why I mentioned germ theories. The ancient Egyptians had learnt to build towns away from fetid swamps and had various explanations for why, none of which involved germ theories. Up until the late 19th century miasma theories based on ideas of fetid air were prevalent http://en.wikipedia.org/wiki/Miasma_theory_of_disease Even 19th century cholera outbreaks in London were acted upon and the causes prevented prior to a fully developed germ theory. http://en.wikipedia.org/wiki/1854_Broad_Street_cholera_outbreak (excuse the wiki) My point is not against the advancement of knowledge but rather that it is not a pre-requisite for effective action that full knowledge of the causes of something is available. In fact believing that the pursuit of knowledge is a pre-requisite can hinder effective action. If something appears to work it is entirely reasonable to do it before you even understand how it works. This approach is commonplace in practical sciences such as medicine. For a more recent case look at the BSE outbreaks of the 1990's which were acted upon prior to a knowledge of prions.


Your point, "And these days people can put out fires because people who do understand the physics have shown them" kind of helps my position as it exposes the flaw in your position. Is it really the case that people need people who understand the physics of fire to show them how to put it out? If this analogy applies to revolutionary struggle, are you really suggesting that the Marxist theorist is as necessary for an effective revolution as a physicist is for fire fighting? If so, then it would appear that the Marxist theorist isn't very necessary at all.

What is necessary for effective change is an awareness of the problem, the fire, and knowledge of how to put it out. The problem is the capitalists who should be extinguished by being provided with the choice of defection or jail. The choice will be theirs, the people giving them the option will be us.