THE END

Well, this blogging business was a bit of an experiment for me. It hasn't managed to engage my enthusiasm for very long, so I've decided to quit doing it. I suppose I owe those of you that have bothered to come here an explanation, so here are the reasons:-

1] It became a real chore to write here. As I suspected, writing took longer than just commenting on other blog sites due to the need to fact-check what I was writing, provide links, check spelling and so on. To be quite frank I've got better things to do with my time, not least of which is starting up my own company.

2] Not enough people came here to make it worthwhile. That in itself wasn't a problem, because I didn't exactly try hard to publicise it. In order to get a blog site publicised you need to increase its "weight" so that search engines find it more readily. This is done by making sure that other sites have your links on them. Most bloggers achieve this by running around posting on all kinds of other blogs. To some extent this is self-defeating, because the more you try to raise your own profile by posting on other blogs, the more those other blogs have THEIR profile raised thus pushing your own profile to the bottom. It also means that a lot of the postings on blogs sites are there purely for reasons of self-promotion rather than to contribute anything worthwhile in the comments. A good example of this is the comment by "George Street" in the comments of my last post here, which was obviously intended purely to promote his own blog. I'm not bitter about that at all, its just that it has revealed to me the way that "Blogging" actually works. Too much of it is just "blogging incest" - bloggers linking to bloggers purely to get their blog rated more highly on Google. A lot of blogging mutual back-scratching activity, but is there much else besides?

3] It wasn't going to get any better. Guido likes to claim he has 350,000 unique visitors a month. This is bullshit as far as I can see. Due to "Native address translation" it is very difficult to judge how many visits you get based purely on IP addresses. You probably get a new IP address every day when you log in - so 350,000 unique IP addresses over a month would correspond to about 12,000 unique visitors. Looking at this another way, back in tho old days when you had forums, you could see how many posts there were and how many people had read those posts (being as there was not a lot of point in reading the same posts over and over again). Rarely did you get more than 100 readers for each comment posted. Thus it implies that in the world of the internet, for every 100 people reading a webpage, only 1% actually post. This means that you can get an idea of the number of readers from the number of people commenting. I would say that Guido has about 100 people commenting, which implies a maximum of 10,000 regular readers. That's actually pretty good for a one-man-band single issue media - the far bigger Guardian newspaper is bought by just 450,000 people, but it isn't nearly as big as he would like to imply! Now the fact is that Guido is by far the most popular politics blog and is likely to remain so. Other blogs just can't compete. Most of the "serious" political blogs out there have about 100 regular readers, I would say. I'm not sure that's enough potential readers to keep me wanting to preach to them. Which leads me onto my next issue....

4] I recently posted a comment on another blogsite which was really annoying. No, it wasn't the comment that was really annoying, it was the fact that I re-iterated the same point. The thing is that although the comment was read by the same people, not one of them had taken on board what I had to say the first time. Which was a shame, since what I was saying wasn't anything to do with "opinion", which people are entitled to ignore - it was simply a cast-iron FACT. If people reading blog-sites are not open to worthwhile cast-iron FACTs then there is precious little point in writing stuff for them to read anyway! Most of what I am writing here are just opinions, with a few facts scattered about. If people aren't open to my facts, they certainly aren't going to be open to my opinions. Unfortunately, this means that those people that have shown an interest in my blog already agree with me to a great extent, which is nice, but it means I am merely preaching to a handful of the converted. I'm not even sure who these "converted" really are. Its not like we are meeting down the pub and discussing politics. Probably you are all good folk - but maybe you're not! Maybe you are all on the internet from the local mental hospital. Impossible to say, isn't it? Problem is that if you keep preaching to people that agree with you anyway, you are contributing to their "confirmational bias", and your own. I'm not like that personally, I prefer to have my opinions challenged, so I can test how good my opinions really are. Continually communicating with people that just agree with you could lead to madness, like those loons that talk each other into believing the end of the world is coming.


I think this experiment has been worthwhile for me. It has shown me what political blogging is all about in this country. It is really about entertaining a few thousand like-minded people (predominantly Tories and BNP supporters) that want to have a good old swearing rant about the failings of the incumbent government. I'm not even sure that this is a good idea - maybe this just acts as a safety release valve for genuine anger that should be exhibited in the real world rather than the virtual world. Maybe that's why we don't get so many people angry on our streets anymore. Maybe that's why the government isn't really looking to clamp down on sites like Devil's Kitchen - because its better that people swear at Gordon on the net than in real life in front of the TV cameras. It may also give a rather distorted picture of what the average Joe in the real world is actually thinking. It's all good fun, but it's not terribly important.

As far as discussing politics "seriously" then forget it. Unless you find that "getting things off your chest" does you good - in which case it might be good therapy. I enjoy having a good rant on Guido's site too (but perhaps it would be better if I spent the same time having a rant at my local MP.....).

I had hoped that I would get a few more readers building up over time and some of my better quality ideas might turn out to be quite influential and spread more widely. I used to notice people picking up my ideas when I commented on the Guardian's CiF site, but this just isn't ever going to happen here. It really isn't how blogging works. Blogging is all about entertaining people in a superficial way, people that already agree with you.

So I'm going back to the entertaining business of having a rant on Guido's blog. Sometimes I might even post the odd serious comment there too - after all, there's a chance that someone might actually read it there! I'll probably drop the "schadenfreude" tag too - its far too long and whilst it was for a while good fun to laugh at Gordon Brown's misfortunes the situation is now far too serious and his misfortunes are likely to be my misfortunes too.

So goodbye, and remember - this is just one less politics blog you will feel the need to waste your time visiting, so its a good thing all round really!

Socialism Part II

In the UK socialism didn't take the same turn as it did in Sweden. I believe that this is due to two factors: one of these is that the British Labour Party was more heavily influenced by Marxism, the other being that the British Labour Party didn't gain any real power until after the working class had started to break apart.

At the turn of the last century, Britain was divided in a class structure consisting of a small number of extremely wealthy capitalists, a small middle class and a huge working class. The economy had a large demand for unskilled manual labour and only a relatively small demand for skilled labour, thus the working class was much larger relative to the middle class at this time.

Because the demand for unskilled manual labour was so great, the working class at the turn of the century was made up of people of every intellectual capacity. Thus my maternal grandfather, a well-read intelligent man, was forced to work down the coal mines simply because there were no other employment opportunities available. People of every level of capability worked together, and thanks to being dependent on council or rented accomodation they also lived
together.

In Sweden, Russia and Germany this huge amorphous mass of working class people would be the raw material of social revolution between the wars. They would be melded together permanently and proceed in lock-step towards their futures. But in Britain this did not happen - another revolution was taking place at the same time. The technological revolution. By WWII technology was changing the Western world at a breathtaking pace. The technological revolution
needed skilled technicians for its advancement, and the only place where these skilled echnicians could be found was within the ranks of the working class. Education and apprenticeships would create new opportunities for employment that simply did not exist for the previous generation.

By the time the Labour Party first gained real power in the UK in 1945 it was based on an idea that was already going out of fashion. It was an idea that belonged to the older generations of the working class. Over the next generation the working class in the UK would dissolve. A new middle class would form from the working class as skilled employment allowed the capable, aspiring working class opportunities for advancement. These people had no need for socialism. They were making their own personal advancement. Britain would not become a Social Democracy like Sweden, it would develop towards being a meritocracy.

In Sweden and Germany the working class had already accepted socialist ideas before the technological revolution took hold. Sweden and Germany had adopted authoritarian socialism to force the working class to conform to models of the ideal German or Swedish citizen. As the technological revolution unfolded these countries simply rode the revolution, feeding the new opportunities into the working class but forcing the working class to progress as a unit. The education system reflected this, with schools and colleges entirely focussed on churning out employees for the new industries. They would become industrial power houses, lead by capitalists - but at the same time the social conformity based on the working class would drastically limit opportunities for independent thought. All socialist states would, in common with communist states, cease to contribute any cultural influence. They became little more than mass-production machines, with human beings as working components. As the people benefitted from the availability of the products of the technological revolution, it was European socialists that took the credit.

This was not to be the case in Britain. The Labour Party may have had real power for the first time in 1945, but a young generation released from the military and an economy on a war footing was in no mood for authoritarianism, or being treated as components in the machine of mass-production. As the new middle class grew and demanded greater freedom, socialism in Britain was forced to re-invent itself and develop a liberal outlook, and the liberal left gained the ascendency. This was to become the dominant political force in Britain.

Of course Britain was not ploughing this particular furrow alone. The United States was following a very similar path and in the 1950s was extremely influential on British politics and culture. But Britain was developing its own culture from the growing new middle class. As it developed large numbers of people from what had been the British working class found themselves with the opportunity to express themselves in writing, in music and art. British culture became increasingly dominant in Europe as the socialist states retreated within themselves - they offered no competition. Today, one could reasonably argue that Britain has achieved cultural ascendency, overtaking even the United States in the sheer volume of its cultural output. Socialists in Britain like to claim that they were responsible for the growth in Britains culural output. From the development of "Kitchen Sink Drama" in the 50s it was easy to see how this misconception arose. Yes, these plays were about the working class - but they were written by the new middle class and it was the new middle class that was interested in them. But the real attitude of socialists to the new middle class was to be revealed in Mike Leigh's "Abigails Party". This biting satire was to define the new middle class in cultural terms- but in fact it reveals far more about the attitudes of the real socialist that wrote it than it does about the ficticious characters that it portrays. The socialists, like Mike Leigh, despised the new middle class. They realised that as it formed, the power that had been within the working class was draining away.

As Britain rejected authoritarianism and would only accept left-wing concepts on a liberal basis, the British welfare state that was intended to shadow developments in Scandinavia had none of the balances that authoritarian leftist politics could provide. As a result the inevitable happened - a large underclass started to form. This was exacerbated by the growth of the new middle class that found it now had the financial power to move away from the growing underclass and leave it effectively segregated. The underclass shunned worked and developed its own nihilistic
culture, unhindered by the influence of "liberal" politicians.

The British Labour Party was influenced by Union financed Marxism. This took the shape of nationalisation after WWII, something that never happened in Sweden which remained dominated by capitalism. The unions wished to protect their members from unemployment, and to achieve this they applied Marxist principles. Competition was to be curtailed. Companies would be brought together in huge national state-owned enterprises. Since many companies were struggling after WWII, it was precisely these companies that were first on the list for nationalisation. Whereas consolidation might have led to cost savings through redundancy to revive these industries, the government would subsidise the losses being made to protect the jobs within these state owned leviathans. This protected the jobs at the full market rate even though the employees were, in effect, redundant. The unions, realising that the jobs were untouchable, now had a free hand to press for higher wages to keep up with the new middle class. The subsidies to the nationalised industry were, of course, coming from those employed in the unsubsidised private sector. Employees in the private sector developed a deep hatred of unionism, and their industries carried a heavy burden of taxation. Naturally this system could not last. It was set up to fail, with productivity tending towards zero and more and more of the nations wealth absorbed by industries that simply could not compete on world markets. By the 1980s the situation had become untenable, and nationalisation was brought to an end. It left a terrible legacy. The employees made redundant often took the attitude that a job in a nationalised industry was a job for life and refused to do any other work. Their own children took the same attitude. They added to the growing underclass living in an unreal world where the farmers toiled to put food on everyone's table but the unemployed acted as if it had appeared by magic.


By the 1980s Socialism in the UK had failed utterly. In a last gasp of denial the Labour Party elected Michael Foot to be its leader - he was demolished by Margaret Thatcher in the subsequent general election. Even the more moderate Neil Kinnock was unpalatable to a population that had moved on. The balance of power was now held by the new middle class and they aspired to greater things - socialism was an idea that was past its prime. The choice of Tony Blair as party leader was an indication of how far things had changed. It had not changed because the people themselves had given up on socialism. It had given up because over time the demographics had changed. The aspirational working class born after WWII had made use of the technological revolution to haul itself up the social ladder since the war. The new middle class had no need for socialism anymore, and it was this class that now held the balance of power.

In the next posting, I will look at British democracy and the manner in which the failings of liberal-left policies became "baked in the cake" of British politics.

Socialism, Part I

"The nail that sticks up gets hammered down" Japanese proverb.

Firstly, we must contend with the view that in the UK we tend to use socialism in a manner which is rather different from the way it is used elsewhere. Socialism elsewhere is either synonymous with Communism or considered as an interim stage towards Communism, but usually in the UK we consider it as an end in itself somewhere between Communism and capitalism. However, in the rest of Europe this is normally described as Social Democracy. Since I have discussed Communism I am more interested in socialism as we perceive it in the UK, i.e. that which is known as social democracy elsewhere in Europe.

For the purposes of discussion I'm going to focus in Swedish socialism. The reason why I am doing this is that Sweden is a purer form of socialism and is often considered a model for the British Labour Party.

To understand Swedish socialism we must first dispel a myth. Sweden does not have a particularly egalitarian social model. Apart from having a royal family, Sweden also has an "aristocracy" consisting of wealthy industrialist families. Amongst the wealthiest of these is the Wallenberg family. The Wallenberg family own Sweden's Enskilda Bank and an investment fund by the name of Investor AB. It is not actually known how much the Wallenberg family is worth. Estimates vary from £5bn to £20bn. The Wallenberg family itself insists it is not rich, as the money is merely funneled into various charities, but there is little evidence of this. The Wallenberg family is easily the most powerful in Sweden, with 30% ownership of all listed Swedish companies, including Ericsson and Electrolux, but they are far from being the only super-rich families in Sweden.

The Swedish Social Democratic Party was formed in 1989. It split in 1917 shortly after the Communist Revolution in Russia, with the Communists leaving the party to leave the Swedish Social Democratic Party as we see it today. Sweden is, of course, rather close to Russia, so one can certainly imagine that rich industrialists like the Wallenberg family were rather concerned about the influence of Marxism over their own employees. Something needed to be done to protect the interests of these families. Swedish Socialism was invented to provide this protection.

Basically the idea was that the capitalists would, in effect, buy off the working class. This would be achieved by giving them a greater slice of the cake in terms of the output of the production. But they were not to get their hands on the means of production. There would also be a "quid pro quo". Swedish workers were to aim to conform to a model of citizenship. This would be enforced by authoritarian policing of a plethora of new laws, strict education emphasising the perfection of Swedish social democracy and the imposition of a new social order where consensus would replace open criticism and debate. A welfare state was introduced, but the Swedes understood immediately the "moral hazard" that would accompany a welfare state. In order to prevent the growth of an unemployable underclass, Sweden embarked on a programme of eugenics. Between 1935 and 1975 over 60,000 people, almost all of them women, were sterilised to ensure that their children could not be a burden on the state. Naturally such programs were of interest to the German Nazis who had by the 30's risen to prominence, and there was considerable co-operation between the two states:-

"A darker chapter is being written now about the Wallenberg family and its extensive business empire, as Sweden confronts dismaying new evidence that the country's wartime collaboration was more extensive than is widely known, and that the Wallenberg family profited from secret dealings with the Nazis. For instance, documents from World War II contain evidence that Jacob and Marcus Wallenberg, Raoul's cousins, used their Enskilda Bank to help the Nazis dispose of assets seized from Dutch Jews who died in the Holocaust."

-Walter V. Robinson, Boston Globe.

Next time you visit IKEA, you might like to consider that its founder, Ingvar Kamprad, was a Nazi sympthiser (oh, and he is estimated to be worth $31bn!).

A strongly nationalistic education and a long history without significant immigration has ensured that Swedish Nazi sympathies remain strong even today. In recent years the grip of the Social Democratic Party has weakened and immigration has grown, but new immigrants are rarely welcomed into Swedish society. Swedes have long practiced the "shunning" of those that do not fit in with a group, and this ensures the total ostracism of newcomers to Swedish society.

Sweden has long since left the policies of eugenics behind. These days it prefers the mechanism by which children are taken from their parents by the state in order to improve the quality of the Swedish "folk". This article by Siv Westerberg, a Swedish children's lawyer, puts the facts plainly and gives an idea of what life is actually like in Sweden.

Fundamentally, Socialism in Sweden is about combining left-wing welfare state economics with authoritarianism. The Swedish people are pressured by the system they live within to conform to a strict model for the ideal Swedish citizen. Middle-class, compliant, uniform and dull. This state is relentlessly de-humanising. Where once Sweden was the home of great thinkers and artists, it is now only the home of pop stars and former tennis players. Where are the great thinkers and writers of modern Sweden? All over Europe, where Social Democracy reigns, this de-humanising process is promoted. The individual gets hammered in, intellectual talent is suppressed. Such a society appears to be stable and successful - but in the manner in which a termites nest might be said to be stable and successful. Is this what a human society should be about?

In Part II I will take a closer look at Socialism in the UK, and compare it with the European model.

Communism

Back in the middle of the industrial revolution, Karl Marx took a look at the way the working class were living and was not impressed. Clearly they were poor, and living hand to mouth in most cases, whilst on the other hand those with their hands on the means of production were extremely wealthy. These wealthy capitalists could not be challenged by the working class, unless the working class rose up in a revolution and took the wealth back from the capitalists by
force. Marx believed that once this was done everybody would live as one big happy classless family. He was totally wrong however, as was demonstrated by the first real-world implementation of Marxism which was to be known as communism.

In the communist system it is realised that all the rich people have their hands on the means of production. As a result they are in an unassailable position whereby the rich keep all the wealth to themselves and eveyone else gets the scraps from the table. Communism sought to address this by taking ownership of the means of production off the wealthy and collecting it all together in one place. These "collectives" of ownership needed to be controlled by someone - and that someone would be a representative of the communist state. So now you can see the clear difference. In the capitalist system all the means of production and hence all the wealth
is controlled by a small number of people and everyone else is a slave to the system. In the communist system all the means of production and hence all the wealth is controlled by a small number of people and everyone else is a slave to the system. See the difference? In the former case the people on top are called "capitalists" and in the latter case they are called "communists". Big deal. In fact you can already see that the capitalist system at least has the advantage that the power that goes with wealth is slightly separated from the power that comes from politics.

Now, it gets worse...

As I said, I believe society is like a living biological mechanism. If you take the head of that organism and swap it for a completely different head you are asking for trouble. The new head is unlikely to know anything that the old head knew. The patient is likely to suffer severe trauma during the operation. And yet that is just what a communist revolution does. Wise heads are despatched and replaced with fresh new, but unwise heads - and this is done wholesale.
Consequently nobody knows what they should be doing (but nobody wants to admit it). A lot of people are killed during the process of revolution.

And the problems continued, because it was not just the head of the biological mechanism that was replaced, but many of the internal organs were transplanted to, leading to rejection of those new organs...

Communism started to suffer from the Laws of Unintended Consequences. The point of a communist revolution was to make the employees better off by reducing the "inefficient" cut-throat competition of the capitalist system. The state would set the prices of production in order to alleviate the burden on the employees. The problems of this become obvious with farming. If you reduce the incentive to sell more produce but suggest that under communism farmers should not work so hard then the farmer will simply produce enough food for his own family and then take a long rest. This is a very bad thing. And when the communists realised that food production was falling they needed to do something about it. They couldn't blame their own system (due to the psychological problem known as an "escalated commitment to a failed course of action") so they had to blame the farmers. Obviously it must be a conspiracy. The farmers need to be oppressed. Send them to the gulag. Replace them with new "communist" farmers. The communist farmers don't know what they are doing so farm production falls again. It must be another conspiracy right? So more oppression and murder and imprisonment results. Production continues to fall and what is worse the employees are now working under the threat of the gun where previously under the capitalist system they were working merely under the threat of being layed off.

Communism appeals to the emloyees by reason of making their life easier, but inherently if you make their life easier then production must fall. If production falls then the employees must be materially worse off. To raise production without re-introducing the incentives that would lead to class distinction that communism attempts to avoid, you must resort to brute force. Simple.


The fact is that all revolutions of any kind are primed to expect resistance and primed to oppress that resistance by violence. Consequently the failings of a revolution will be seen not as failings in reality but as "resistance" which must be violently repressed.

You were probably taught in school that Stalin was a violent man that oppressed his people. But the reality is that communist revolution always results in failure, which is then perceived as "resistance" to the revolution, and this always results in continued violent repression of the people. Right now it is happening in Burma, and Cuba, and Zimbabwe and many other places. It is the idea at the base of these revolutions that is fundamentally flawed, which results in a need for the regime to impose its failed beliefs by force, which in turn means that there must be a violent oppressor at the top of the regime. If the leader of the regime doesn't fulfill that requirement by becoming increasingly violent, then the regime will tend to replace him with someone that is prepared to be a violent oppressor. This is why all these communist regimes have gone the same way. They are trapped in a mechanism of their own creation where the violence and oppression and failure are inevitable right from the start. Once again a "god" created from the mechanism of society.

Capitalism is bad, but communism is far worse, because it is fatally flawed and in the end can only be imposed by continued brute force.

But what of that flavour in between pure communism and pure capitalism we usually refer to as socialism? More about that tomorrow....

Capitalism: Part II

This is how capitalism works:-

Lets consider ten pig farmers. They are all farming the same size plot of land with the same pigs. They live far from each other but brings their pigs to be auctioned at the town market every so often, which is the only time they meet. The auction is a "free market". Note that it has certain regulations but acts as a legal framework within which certain specified goods can be traded openly. The pigs are sold at market at competitive rates. The pig farmers struggle to make a living, because the market place has many things to sell and because the pig farmers compete against each other. The customers are also struggling because they have to pay more for their meat - ten pig farmers serving one market may not achieve maximum efficiency.

For the sake of argument we will assume that one pig farmer has some good fortune. He inherits some land. His pig farm is now twice as big as before. He can relax a little and sell the surplus meat at auction. He has no interest in driving out the competition - he just uses the extra wealth from selling more meat to have an easier life. Whilst he complains about his competitors he has respect for them. He knows they have to work hard and that he has just been fortunate.

Amongst other things he spends some of his extra wealth on an education for his eldest son, so that he can be sure that his beloved son will have a good start in life. His son learns about all sort of new-fangled ideas, one of which is called "capitalism".

Years pass and the pig farms are now all in the hands of the sons of our original farmers. Our capitalist pig farmer is eager to prove that he can achieve everything his father did and so much more! He intends to use "capitalism" to demonstrate just how big and important he really is! He starts selling his pigs at auction for 10% less than the usual price. His competitors are thrown into disarray. How can they manage to compete? Not realizing that the supply of cheap pigs is stricty limited, they cut their own prices. This cut-throat competition is too much for one pig farmer. He decides to throw in the towel. He needs to sell his farm - but no-one wants to buy it. They don't have the money you see. All except one. Our capitalist pig farmer was already wealthier than the rest - so he buys the pig farm that is for sale. And since he is the only buyer in town he gets it for a knock down price too. Now he has a pig farm three times as big as the nearest competition. The process repeats again, and another pig farmer gets driven out of the competition. We now have one capitalist pig farmer with 7 others. Notice that our capitalist pig farmer has only a small proportion of the total market. Nevertheless he has an effective monopoly. Not only does he set the price of pig meat at auction, he also puts the squeeze on his suppliers eager to get his high volume business. He also sets the price of pig farms, as he is the only one that can afford to pay for more land.

The 7 others are getting worried. There are mutterings at auction. Four of the pig farmers decide to get together to form one big farm. Fantastic! Now they have a farm big enough to compete with our capitalist pig farmer. This is called "consolidation". Sadly they still have 4 farmers living off the same farm so their costs are not competitive. Consolidation seldom works. Unless one of the pig farmers takes the deeds of the other farmers and then throws the other farmers off their land (asset stripping) then they won't be able to compete with our capitalist. So they go out of business too, leaving 4 more farms for sale.

Now we have four farms for sale, a capitalist pig farmer with four farms and three other small farmers. But there are another four farms for sale. All four pig farmers decide they have to snap up these remaining farms. The three small pig farmers haven't got any money to buy these farms, so they go to the bank. They all go to the same bank to take out the debt to buy the farms. It may seem strange that the bank is happy to lend to all three - after all, it looks like only one of the farmers has much of a chance of being succesful - but the bank doesn't care about this as we shall see in a later blog post.

The remaining four farms do not sell for a knock down price like the first two. Now we have more money in the system in the form of debt so that means the demand side for the farms is awash with liquidity causing asset inflation. Nevertheless we assume that the four farms are sold to the farmers that have taken out debt. The farmers with debt are going to struggle to compete with our capitalist. They have interest to pay after all. Eventually most will go out of business. We can imagine that we end up with our original capitalist farmer with four farms and our debtor big farmer who has gradually built up to 7 farms. However, our debtor farmer cannot compete easily with our original capitalist because he has a lot of interest to pay.

At this point our two pig farmers can continue to compete until it's last man standing (the American Dream?) or they can decide that further competition is not worthwhile. The risk vs reward ratio is not good. They form an informal cartel. We do a lot of these in the UK - supermarkets and mobile phones perhaps?

Left to its own devices capitalism will drive out all competition, force down wages but keep prices up (Notice that the purpose of competition was never to decrease prices - it was always aimed at increasing wealth for the winner. After the initial 10% discount on prices the consumer never saw another discount, even with improving efficiency at the farms). In the end all the real wealth - the production capacity - ends up in the hands of a very few. Everyone else is dirt poor (just like Ethiopia). It looks a bit like feudalism but without the guns. The wealth merely passes down in the same families. But did these families deserve such wealth? Our original capitalist merely inherited good fortune. He had no special skills or talents. That wealth stays in the family for ever, since the ones with their hands on the means of production are in an unassailable position. The Duke of Westminster's family have been wealthy for a 1000 years, despite being nothing special. Of course they have blue blood allegedly - but if ever there was a pathetic self-justification for clinging to wealth you don't deserve, that must be one of the best.

Capitalism as a system does have a major flaw. If everyone who works in the capitalist system is dirt poor, who do the capitalists sell to? Well this started to become a problem in the latter part of the industrial revolution, and the answers to this conundrum spawned socialism and consumerism. I'll discuss these another day.

Now you may think that if I'm anti-capitalist I must be a Communist. But this is based on a false dichotomy. Communism is even worse than capitalism, as we shall see in my next post. But in the meantime it is worht reflecting that capitalism sprang up in this example by accident. The free market gave birth to it. It was an inevitable result of the free market, but it rapidly developed a life of its own. No-one person really controlled it. Deus Ex Machina? The god of capitalism created from the machine of the free market.

Capitalism: Part I

Just a short post today since it's Friday and I'm a bit busy trying to finish off this weeks work! And since its Friday why not round off the week with an amusing little story that happens to be very relevant to Capitalist society. This is the kind of thing that passes as humour amongst salesmen and marketing people!

There are two work colleagues walking out in the wilderness as part of a "team building" exercise. They reach a long narrow river valley and start walking along, enjoying the beauty of the countryside, the peace and quiet and the fresh air. After they have walked a couple of miles they see a grizzly bear a little way off in the distance. He's clearly not in the best of moods! The grizzly starts running very fast towards the two men "Jesus, look at the bear! He's huge. He's running straight for us! I think he's going to attack us! What the hell are we going to do?!" says one of the guys. The other guy takes off his rucksack, removes a pair of top quality Nike trainers and proceeds to put them on his feet. The other guy starts screaming at him "What the hell are you doing? We're never going to outrun that bear!". The guy with the trainers turns around calmly and says "I don't need to outrun the bear. I only need to outrun you."

I think you can learn all kinds of things about competition from that little anecdote! Have a good weekend. Next post should be on Monday, with a bit more on capitalism and competition.

Corporate Thinking

In my last post I promised that I would give an example of what I meant by a "Deus ex Machina" model by considering the behaviour of a large company. I work for just such a company. A large German multi-national with tens of thousands of employees. Nobody can know everything that goes on within such a company, and that includes the board of directors.

Although I am an engineer I work closely with the marketing department. The responsibility of marketing is to match the supply side (production) with the demand side (sales). As such marketing has an excellent view of how the company is operating.

The company that I work for has been struggling. It has not made a profit for ten years. In fact it has made substantial losses for much of this time. Within companies that are struggling interesting things start to happen. Ambitious people that perceive that their careers are not best served by staying with the company make their way to competitors. The people that remain are usually very focussed on retaining their jobs. In successful companies working to keep ones job is usually aligned with making sure the company is successful by complying with the directions of the board. In a struggling company this is not the case. In a struggling company the board usually wants to cut costs, and this is not likely perceived to be in the interests of the employees. As a result the employees may seek to frustrate the actions of the board.

The various component parts of the struggling company start to malfunction. Salesmen, who are usually measured by revenue targets, start to panic when confronted by a purchasing manager at a customer. Thoughts of preserving profit margin fly out the window as the salesman seeks to ensure that the business can be booked regardless of the selling price. They will co-operate with marketing and engineering while it suits them to do so, but will knife them in the back if the appear obstructive. Meanwhile marketing, normally measured in terms of profit targets, will find that the profit targets cannot easily be met and therefore they will try to excuse this by also focussing on revenue growth. Thus they will happily work with the salesmen to push the product prices to low levels, as showing management the successful winning of a new account is better than walking away empty handed.

[It should be noted that the purchasing manager at the customer smells the weakness of the salesman from a struggling supplier. He may choose to avoid a struggling supplier altogether, but if not he will certainly pressure that salesman for lowest cost. He will not be concerned that his falsehoods about the competition might be discovered - he knows the salesman from the struggling supplier is, in practice, on his side and won't challenge him.]

Having pushed prices down too low, marketing will then put pressure on production to reduce production costs. Production, which is normally measured in terms of production efficiency, knows that full efficiency can only be achieved with a factory running at capacity. Thus production will promise that the manufacturing cost can be met, to ensure that the end customer will take the product and the factory will be filled to capacity. They can afford to lie since they don't actually work for marketing. They will simply charge the cost of the product to the company and then make excuses later for not reducing manufacturing costs to a profitable level - probably knifing marketing in the back at the same time.

You can probably already see that this is a recipe for disaster. The prices of the product are too low to make a profit. But worse than this, over time the factory will become full to capacity with products which are loss making. To recover this situation the board of directors could choose to end production of these products or push up the price to end customers. Either is unlikely to be well received by the market! And cutting production of the unprofitable product is likely to leave the factory empty and thus inefficient until new products can be used to fill it again. In any case, unless the attitude of the employees is changed the same process will repeat again.

So the board of directors has a problem. They need to either increase the product profit margin or cut costs. An Anglo-Saxon company would probably adopt the latter, but this is a German company so this is not what happens. The German company takes on yet more debt to acquire smaller companies with profitable products to feed through the production, in the hope of gradually improving the profitability of the company as a whole. But there is a problem. The board of directors puts the newly acquired small company in charge of one its German middle-management teams. The middle-management team like this. They want to protect their own well-paid jobs! So they strip the newly acquired small company bare of anything of value and leave the employees of that company out in the cold. Those latest employees will be first out the door when the next round of redundancies occur of course! Meanwhile the acquisition can hardly be said to be successful. The attitude of sales and marketing is still weak, so the end customer purchasing manager finds he is able to push the prices down yet again! The board finds their plans have been frustrated!

This is what happens at my German employer. You can see that whilst the board ultimately wants the company to be successful and the employees also want to protect their jobs, the reality is that the company is propelling itself towards disaster. The company develops its own persona when taken as a whole. It is nervous, jittery, depressed and indecisive. But you can also see that the board really has a hell of a task on its hands to turn the company around. The attitudes of the employees would have to change. They would need to be made to feel safe in their jobs, and in a struggling company that is difficult.

It is my contention that government of all kinds tends to be like running a failing company. Except when fighting a major war, there is little "buy-in" from the citizens with government policy. Generally people prefer to frustrate attempts to be "governed". Perhaps that is a good thing, but wouldn't it be better if government took us in a direction we were inspired by? A direction we had faith in? In my next few blog posts I will consider the various systems of society (capitalism, communism, socialism and democracy) and why they fail to inspire the people. In the meantime I would be interested to hear from any of you of organisations that you have been a part of that seem to have developed their own kind of madness!

"Deus Ex Machina"

Before I delve into the politics and economics, I want to clarify what I mean by "Deus Ex Machina". It would be easy for readers to get the impression that I see society as some kind of robotic machine that creates a god, floating on the clouds and dispensing mystical thunderbolts. This is definitely not what I mean! I consider this machine as a biological entity with the "god" being a separate consciousness that is derived from society but has no physical embodiment. It is a function of group thinking, and I suspect that all groups with more than 100 members tend to suffer from it. Let me show you what I mean by analogy to the human body.

In the beginning there were single celled organisms. Each was a living entity in its own right, but these living entities did not relate closely to other single-celled organisms. We can imagine this as being similar to human society before language developed, before complex communication was possible.

Thanks to the process of evolution, the single-celled organisms changed their behaviour. Instead of dividing and separating into separate creatures, they clumped together to form colonies. This didn't happen as a planned, well thought out strategy. The single-celled creatures were not capable of such things. In reality it happened as an accidental response to the environment the single-celled creatures found themselves in. It seemed to work, and these multi-cellular organisms thrived. This is analogous to the period of human history where language first developed and communities formed.

The process of evolution continued. Multi-celled organisms developed into ever more sophisticated creatures where certain cells were tasked with specific functions within a much larger organism. Each single-cell continued to be a living organism in its own right, but with no understanding of its position within the creature it was a part of, and no awareness of the existence of such a creature. This is where evolution currently stands, and it is analogous to the evolution of human society, which reached its apogee perhaps around the time of the Egyptians. Complex societies formed where individuals might have very specific functions within a society that was sufficiently complex that no individual could fully grasp how the totality of society functioned.

It should be realised that evolution is not driven by the individual cells that make up the human body. These individual cells are unaware that evolution is happening, or that they are part of some larger mechanism. Are we aware that we are part of the creation of human history? The cells are not aiming towards a particular, worthwhile goal - and neither are we.

Those cells that are part of the brain may be part of the thought process of the human individual, but they are unaware of the thoughts of that individual. Similarly, those individuals in human society that have power and influence over the whole, are actually unaware that they are trapped within a larger mechanism and that their thoughts are just a small fraction of the thinking of the whole organism we call "society".

Naturally the human body is built up not merely of cells, but of separate key functions that relate to each other. Changing one of these key functions could prove fatal to the whole organism. Sometimes the importance of certain body parts is not immediately obvious. On the other hand, individual cells may die, but they act in parallel with many other cells and can readily be replaced.

In human society, political revolutions are analogous to performing multiple organ transplants. The trauma of the operation is liable to be fatal to the patient. For such radical surgery to have a chance of success, the patient must first be put on life support. But there may also be a temptation to do nothing at all to alter the running of society. Any change could prove detrimental. But by failing to grasp the reality that history is something that is being forced upon us as individuals by the thinking of "society" we fail to become truly free. We are slaves to "society" however that society is defined. The thinking of "society” as a whole may be leading us slowly towards disaster, without us even being aware of it. No single individual is actually in charge, although it may seem like there is. It may seem that there is a conspiracy to control us, especially when the outcome of government thinking seems out of tune with our own thinking - but there is no conspiracy. We, and our governments, are trapped by the thinking of "society" as a whole.

In my next post, I intend to apply this "Deus ex Machina" model to the behaviour of a large corporation, so that it should become more obvious how trapped we are within the organisational structures we create. Subsequently I will expand the concept to the societies we have created.

This is a new political blog...

Do we really need another political blog, you might be asking?

Well perhaps this one is different.

This blog aims not to examine the minutiae of daily democracy in the UK. This blog aims to examine "society". It will examine the thesis that "society" is a "machine". Not a dumb unthinking machine but a thinking, emotional machine. It will discuss the component parts of this machine and how they interact. It will consider political revolutions and why they have failed. It will consider war and poverty and how they arise. It will consider the failings of capitalism and democracy, and how they might be repaired.

The name Deus Ex Machina derives from the Greek "God from the machine". In Greek theatre it refers to the practice of lowering to the stage an actor, representing a god, who would then magically resolve the situation occurring in the drama . I intend to use the term in its most literal sense - a "god" that is derived from the biological machine we know of as "society". It is a metaphor, but nevertheless should help us to understand how complex systems like societies work. It will help us to understand why society does not work the way we would like it to, and it will do so without resorting to class-warfare theory or conspiracy theory.

I am a senior engineer that works with the marketing department of a large European multinational corporation. I have a fascination for "how things work" - including a fascination with how large corporations work and how society works. Many large corporations are the size of towns and even cities. The way they work (or indeed, fail to work) is the way a complete society works in microcosm, especially capitalist society. The psychology and sociology of corporations holds the key to the inner workings of Western society.

Why such a blog and why now? Because the indications are that the society we live in now may be about to undergo seismic change. We will investigate the reasons for this. It may be that the changes that society will undergo are of a similar magnitude to those experienced in the 1930's as a result of the Great Depression. This monumental change resulted in war, and paradigm shifts in the manner in which societies were operated. Is the same about to happen again? Some mainstream commentators such as Matthew Parris and Matthew D'Ancona are becoming uneasy. But there is no-one in a position of influence today that is able to remember the 1930's from first-hand experience.

"Those who do not read and understand history are doomed to repeat it." - Harry Truman

Reading history is the easy part. Understanding it is considerably more difficult. In this blog we will see that "society" deliberately fails to understand history and therefore must inevitably repeat it. And therefore we are very likely to repeat the mistakes of the 1930's, and then the 1940's. "Society" has a mind of its own, beyond the control of the citizens that are its component parts.... but society has a very short memory.

I do not have all the answers, or even all the right questions, but I hope those that read this blog will contribute much of their own experience and knowledge. Hopefully, together we will learn something about our society, and how it controls each and every one of us. We might even understand how it can be changed for the better.