Schneier on Security

The Black Storm Ahead • April 27, 2020 8:06 PM

The spread of the coronavirus is exponential. If measures were not taken, in a matter of months, millions of people would be affected. Its ability to reproduce is a biological success. However, from a human point of view, it constitutes a threat and the priority of each country is to try to limit its spread through information, hygiene, and confinement measures, etc.

Our capitalist economy has also had exponential growth, thanks to the exploitation of fossil fuels and the development of science and technology applied to production. We are 7.6 billion people, we have colonized the entire planet and a quarter of humanity does not stop traveling by land, sea and air. Without a doubt it is a landmark of industrial civilization.

In the absence of a god to judge us, from a systemic perspective with a planetary perspective, this success is the prelude to an unparalleled failure that if we do not correct in time – hopefully reflection on this pandemic – will end civilization and perhaps with the species. The economic success of capitalism is equivalent, on the other side of the equation, to the destruction, also exponential, of the planet’s resources and vital systems. The budding energy crisis, as well as the climatic and ecological ones, have the same causes: economic growth and human expansion. Also the current health crisis is the result of economic growth and human expansion of which we boast so much; By destroying habitats through deforestation, natural resource extraction, monoculture and the consumption of wild animals, we facilitate the contact of pathogens with human populations (1).

As if GAIA were watching over the health of the planet, the coronavirus pandemic has temporarily pushed away energy and ecological crises, slowing economic growth and polluting emissions. The coronavirus has taught us that a few months of economic slowdown have been much more decisive than the 25 POPs to mitigate climate change and postpone the energy crisis, even if temporarily.

Experience shows that pandemics do not recognize borders but the inability to address them on a global scale. It has also called into question the policy followed by neoliberalism for the sake of economic benefit by concentrating many industries in China – including health – which has prevented an effective response to the pandemic.
In the face of global threats, a UN capable of informing and coordinating all countries is required to make the relevant decisions. Now, if once this coronavirus crisis is overcome, the social and economic deterioration that decimates the middle class continues in rich countries, the next pandemic could be much more serious and unleash chaos, with hundreds of thousands of deaths, overflowing any action. international.
A continuously growing economy, such as the capitalist one, cannot solve some of the global threats it causes, such as climate change, the ecological crisis and episodic pandemics.

There will be no energy or ecological transition if there is no economic transition
We need another economy that stops the destruction of our planet and allows us to develop another society with more human values. We need to make an economic transition to another type of economy and society that meets these conditions and which, from our point of view, could be ecosocialism. Without an economic transition to leave capitalism behind there will be no sustainable energy and ecological transitions.
The economic transition towards ecosocialism involves two phases: a phase of decrease , which will probably end up being imposed by nature, with two main objectives, the deactivation of the capitalist economy and the creation of conditions so that the new economy can unfold, and another phase of development of an Ecosocialist economy, whose objective would be the implementation of this economic alternative that must follow the principles of ecological sustainability and, at the same time, improve the social conditions in which the countries and classes most in need are found.
Here we will only deal with the decrease phase.

The decline and deactivation of capitalism

In the coming decade, there will be problems with fossil fuels, especially oil. Surely they will manifest with brutal ups and downs in the price of this resource that will alternatively produce economic problems in importing and exporting countries. However, this swing cannot last long since there will be an irreversible trickle of exporting countries that will swell the importers’ line, thus accelerating the oil decline.
However, the depletion of fossil fuels and other resources does not have to be the end of capitalism. If this system has proven anything, it is that it has a very high adaptability. Although energy and mineral resources are diminishing, the system could survive in some countries for several more decades transmuting into rentier capitalism or, as Collins (2) says, into catabolic capitalism that “feeds on” and destroys society trying to survive from the wealth of States, through debt and the acquisition and management of state infrastructure and services.

The replacement of the capitalist economy by an ecosocial one supposes, in the words of Carpintero and Riechmann (3): “(…) to hamper free trade and the operation of markets, the power of capital, the commodification of labor and nature ” But that is not enough, there is an urgent need to neutralize it and to stop operating in societies.
The exponential growth of the capitalist economy depends on the accumulation of capital through two mechanisms: the appropriation of surplus value of the workers by the employers in the productive economy and the imposition of money in financial entities that allows it to multiply at positive interest rates.
Here, two complementary measures are proposed to deactivate it based on the control of these accumulation mechanisms.

Regulation of wages in productive companies

Historically, the Russian revolution implemented the nationalization of productive companies, a revolutionary measure proposed by Marx and justified because the part of wealth taken from the worker by the businessman (surplus value) is considered unfair. However, after the fall of the Soviet Union, today’s societies would hardly accept such a centralized measure, which is no obstacle to nationalizing essential services.
Fortunately, we have another less drastic possibility: the regulation of wages in private companies and, of course, in nationalized ones. The government would negotiate maximum and minimum wages with the unions in different sectors and professional categories, and all company workers would vote on wages, including that of the employer. Cooperatives would operate autonomously, as is the case today. Today there are already companies that are established as cooperatives. Cooperatives meet and discuss and vote on different matters, including the range of salaries. In Felder’s Economy for the Common Good (4), it is the assemblies of citizens who vote on different issues of the town, or neighborhood of a city, including the difference in the degree of inequality that may exist between the highest and lowest wages.

The imposition of negative interest rates

The imposition of money at a positive interest rate encourages accumulation and competition among capitalists. This is an essential mechanism for the conversion of money into capital today, even more so when the productive economy has entered a sluggishness that no longer provides sufficient benefits to the system.
The modification of the rising interest rate has historically been used to cool down productive activity and control inflation, and downwards to activate it and raise inflation.
But, according to Dierckxsens (5), there is a reform of the financial system that could guide this decreasing transition towards a stationary economy and, from our point of view, towards an ecosocialist economy. It is about regulating capital accumulation by setting negative interest rates on financial institutions imposed by the central banks of the countries and, in the European case, supervised by the ECB (6).

A negative interest rate discourages accumulation since the money deposited is devalued. In these circumstances, the capitalists would seek to invest their money in productive activities because the lender, which is the bank, would pay interest on the loan. Initially, there would be an increase in productive activity that would originate more capital, but this, at negative interest rates, could no longer multiply, which would slow production.

The surplus value loses its meaning with this measure since it is the form of accumulation of money that the capitalist has in the productive sector and, as we have seen, this money would be devalued from the moment it entered the bank. Naturally, the employer should have a higher salary, both for the exposure of their money and for the quality of the work they do.

The logic of a reform of this type is that it affects the mechanism of the reproduction of capital and, therefore, ends the economic rationality of capitalism (7). These rates could be modulated depending on the amounts deposited and the economic circumstances.
The accumulation of money being a contradiction, the financial bubbles responsible for crises in capitalism would not have the possibility of forming.

However, such a reform of the financial system is not without problems. For example, retail depositors may argue that savings are necessary to cope with inflation in the future. Positive rates could be applied to this sector. Poor countries could also take advantage of this privilege, in order to attract capital for their development, on condition that they do not overcome their biocapacity. Banks can currently create electronic money; This ability to issue money, which should be exclusive to central banks, should be strictly prohibited. Likewise, tax havens should be eliminated, prohibiting deposits in them as a blatant crime.

But the biggest problem is that to be effective this reform should be implemented worldwide. Otherwise capital would migrate to other countries quickly. Along with the worldwide mobilizations of young people in recent years to face climate change, the coronavirus crisis may allow for greater awareness on a global scale to implement another economic system capable of solving global problems.

Next, we will discuss some economic, social and ecological changes that could be derived from this reform and that constitute conditions, surely necessary but not sufficient, to implant an ecosocialist economy.

It allows to decrease the economic metabolism:

In the context of this reform, profit would be governed by sufficiency and not by accumulation, so the competition between productive companies and their economic metabolism would be significantly reduced. The technological renovation of companies would slow down as the competition is much less, although this renewal could be regulated to increase technological efficiency. In this way, the system would avoid over-accumulation, that is, the impossibility of making the capital invested in technology profitable because the entrepreneur was forced to change it in order to compete, which can occasionally lead to crises that plague productive companies in capitalism.

The tendency to produce durable objects would prevail over time. Instead of creating new needs and promoting consumption through advertising, fashions and programmed obsolescence, this reform would promote the care of things, the repair of things and the fact of sharing them, thus stimulating the solidarity economy. In this way, security and hope would not depend so much on personal and collective work as they would reside in the solidarity economy and not in accumulating money individually. The system would encourage the creation of cooperatives, in which ownership of the means of production would be social and democratic decision-making.

If in these circumstances accumulating money in a bank would be meaningless, it would also be meaningless to hoard objects and merchandise; therefore, the exchange in the markets would be carried out according to their use value and not their exchange value. The money obtained from the sale by a seller is used to buy the goods you need in other markets, not to accumulate it in a bank.

The global and extreme competition that currently exists would diminish, since a negative interest rate discourages competition since there is no purpose in working to avoid accumulating money. In addition to the energy problems that are already beginning to affect global trade, threatening the dissolution of the world network of trade routes, the economy would tend to become increasingly local since the merger and business gigantism would be counterproductive as accumulation is sanctioned. As the economies became more local, a certain degree of competition would persist, both in the elaboration of products and in the sale of merchandise in the markets.
It allows to face unemployment and inequality :

A primary issue is unemployment. In the decrease phase, economic activity will necessarily decrease, increasing unemployment and, therefore, inequality. This would be a tragedy if capitalism still dominated.

There are two ways to combat unemployment: by reducing the workday or / and through State Guaranteed Work. In the latter case, as the decrease in production progresses and unemployment increases, the balance of workers in charge of the State with respect to the number of workers employed in private companies will be increasing. Productivity will slow down as workers hired by the state are not specialized to perform such diverse jobs (8). In the absence of exacerbated competition at the local or regional level, this should not be a problem.
With the passage of time, the imposition of negative interest rates in this decreasing phase would bring us closer to social and economic sustainability .

Stops ecological deterioration :

Another critical result of this reform is that the economy would be much more environmentally friendly than it is today. If the objects were more durable, the extraction of natural resources, industrial activity, energy consumption, and the production of waste and pollution, that is, economic metabolism, would be reduced. With the passage of time, the wasteful trend of “ use and throw away ” would be diminished and the economic metabolism would be brought on track towards a decreasing trend, adapting to local resources, until achieving ecological sustainability . Then the metabolic rhythm would end up adjusting to the principles of ecological sustainability and the biocapacity of the territory, achieving the quasi- closed circulation of non-renewable waste. Economic decline should also be accompanied, if necessary, by population control through positive stimuli.

The restriction of competition on a local scale is adapted to what happens in the Biosphere. In ecosystems there is also a certain degree of competition but it is limited to the populations that interact with each other in each of them. Consequently, to avoid overreaching and taking into account the principle of biomimicry (9), or more properly ecomymesis, it is advisable to eliminate competition on a global scale and restrict it to a local or regional size. And this would be an effective reform to do so.

It allows to tackle an agrarian reform :

Another crucial measure is to design and carry out land reform from a social and ecological perspective. We must avoid land grabbing by capitalists. Given that capital accumulation cannot occur in a negative interest rate economy, in a situation of major unemployment, some capitalists turned landowners could try to accumulate land and have a relationship with quasi- slavery workers , especially if diesel started to become scarce, as it seems that it can happen. Land, water, forests and other ecosystems must be publicly owned. Agroecology makes it possible to conserve these systems through management that follows the principles of sustainability: soil conservation and regeneration, minimization of energy consumption, promotion of biodiversity and reduction of transport thanks to the proximity of markets (10). The formation of local cooperatives would be the most appropriate to give work, manage and commercialize the harvested products. The final objective would be, in the words of González Reyes, (11): ” articulate a living and agro-ecological rural world “.

These brief reflections are not intended to be more than a schematic model that encourages economists to develop a rigorous eco-social economic alternative to the increased risks derived from the crises that this system is experiencing.
What has been proposed along these lines is a possible way to change the current socio-economic system dominated by capitalism for another more humane and reconciled with nature in order to avoid the worst of the collapse. However, there is another alternative that denies what is happening and justifies this system to the ultimate consequences.

Denialism and neofascism

The national and international context is not prone to launch an economic transition that renounces capitalism. In all countries, there is an internationally organized wealthy class that intends to continue with the looting of society and nature and preserve its status no matter who falls, applying the maxim of privatizing profits and socializing losses. The hate speech against the emigrant, the conquest of the soul of the people with consumerism, the rise of nationalism appealing to the security of each country and the denial of climate change and ecological catastrophe, are the axes of the discourse that aerates the neofascism.

Defending the security of each country, ” America first “, and denying the validity of world institutions by boycotting planetary decisions are the axes of neo-fascist politics, knowing that global problems exist. This policy leads to the extermination of half humanity and the exhaustion of the planet, that is, to a genocide and ecocide that are difficult to imagine.

We know that the elite, the super-rich, know global problems; They have the best information about the scarcity of natural resources and the climatic and ecological crises that we will begin to face in this decade and they already foresee their “salvation plans” in the face of what they call the “event”, that is, the collapse (12). The fascist political right is organizing on an international scale thanks to the mediation of Steve Bannon. The North American and European elites already know which way to go: authoritarianism within their borders and war outside them (13).
Perhaps the health crisis that all the countries of the world are suffering can be a turning point in raising awareness to address global problems in a world forum, such as the UN. For the time being, most states have valued the lives of their citizens more than the economy (14) and the champions of neoliberalism that did not initially do so, the United Kingdom and the United States, have had to rectify, which constitutes progress extraordinary.

References and notes :

Duch, G (2020). A food monoculture virus. https://rebelion.org/un-virus-del-monocultivo-alimentario/

Collins, C. (2020). Four reasons why our civilization will not fade: it will collapse. https://rebelion.org/cuatro-razones-por-las-que-nuestra-civilizacion-no-se-ira-apagando-colapsara/

Riechmann, J. and Carpintero, O. (2014). How to think about post-capitalist transitions? In the uncertain steps from here to there. Socio-ecological alternatives and post-capitalist transitions. Ed. University of Granada.
https://www.traficantes.net/libros/los-inciertos-pasos-desde-aqu%C3%AD-hasta-all%C3%A1-alternativas-socioecol%C3%B3gicas-y-transi

Felber, Ch. (2014). End to middle money. Deusto (Grupo Planeta)

Dierckxsens, W. (2008). The transition to a stationary economy: The post-capitalist utopia. http://www.observatoriodelacrisis.org/2008/07/la-transicion-hacia-una-economia-estacionaria-la-utopia-postcapitalista/

Following the 2008 crisis, the economy has entered a period of secular stagnation, characterized by lasting economic sluggishness. Negative interest rates have been used to stimulate the economy. This financial policy is being applied in Switzerland, Denmark, the Eurozone, Japan and Sweden (this country just abandoned negative interest rates in December 2019 to place itself at zero interest rates). In all these cases, it is a temporary regulatory tool for economic activity within the framework of capitalism.

Dierckxsens, W. (2008). The transition to a stationary economy: The post-capitalist utopia. http://www.observatoriodelacrisis.org/2008/07/la-transicion-hacia-una-economia-estacionaria-la-utopia-postcapitalista/

Unti, B. (2014). Political ecology, current capitalism and full employment policies. (A postkeinesiana-marxista vision of the decrease). Without permission. January 12,
2014. http://www.sinpermiso.info/Autores/Brandon-Unti

Riechmann, J. (2005). Biomimicry. Answers to some objections. http://institucional.us.es/revistas/argumentos/9/Art1-RIECHMANN.pdf

Mediavilla, M. (2019). Agroecology to feed the world.

González Reyes, L. (2019). Green New Deal? What Green New Deal? https://ctxt.es/es/20190403/Firmas/25368/green-new-deal-transicion-ecologica-smart-cities-luis-gonzalez-reyes.htm

Rushkoff, D. (2018). The survival of the richest and how they plot to leave the ship. http://sinpermiso.info/textos/la-supervive-de-los-mas-ricos-y-como-traman-abandonar-el-barco

Turiel, A. (2017). Spain before the collapse.

http://crashoil.blogspot.com/2017/06/espana-ante-el-colapso.html

Mediavilla, M. (2020). Coronavirus vs. ecological crisis: a matter of love. https://www.15-15-15.org/webzine/2020/03/20/coronavirus-vs-crisis-ecologica-cuestion-de-amor/