That so much money concentrates at the top that capitalists can’t find useful outlets for it, and that capitalism produces huge amounts of junk we don’t need or want, was reinforced for me upon reading a New York Times article on what apparently has become a war against Instagram bots.
You can’t make this up, can you? So much capital is thrown into marketing that huge sums of money are thrown at Internet “influencers” who apparently are “influencers” because they have large numbers of followers on Instagram. The problem here, from the marketers’ perspective, is that large numbers of those followers are fake. They’re bots created to inflate the size of followings.
Although I couldn’t read this business-section article without laughing at the absurdity of this, it did also nicely illustrate the tremendous amount of waste in capitalist production. You’ve got to have a lot of capital lying around to afford spending on buying posts on Instagram. There is good money in this, it seems, for those who succeed at positioning themselves as “brands” as opposed to, say, human beings.
Because every space is a canvas for advertising
In one example, the Times article quoted an “influencer” who “said that she charged about $1,200 for a branded post. She added that she knew people with two million followers who charge $40,000 per post.”
With a straight face, the Times article casually referred to companies that exist to “connect brands with influencers” and discussed other companies that exist to ferret out Instagram accounts with high numbers of bots among their followers. The article said: “The interest in such firms reflects how easy it is to fake popularity on platforms like Instagram, where bots seem to run unchecked even on accounts where people have not paid for them.”
Apparently, Instagram’s response to this “problem” is to reduce access to its data. That prompted this reaction from another “influencer” in the article: “It will be unfair until Instagram really just cleans out the bots and the lurkers.”
Altogether now: Awwwwww.
Your intrepid blogger does his best to maintain his revolutionary optimism, but reading articles like this does sometimes make me despair for the future. I know such people are a small slice of overall humanity, but, still, there are large numbers of such people who hopelessly swallow capitalist ideology. What if the vast sums of money thrown around in marketing campaigns instead went to more useful functions, such as affordable housing, clean water, environmental cleanups and repairs to our crumbling infrastructure, to point out only a few needs. The investment needed to modernize and maintain school facilities is estimated to be at least $270 billion, a fraction of what is spent on marketing.
We are talking about huge sums of money here: Estimates of the money spent on marketing in the United States per year range from $460 billion to $1.07 trillion. (The former estimate is from the book Marketing by Charles W. Lamb, Joseph F. Hair Jr., and Carl McDaniel and the latter estimate is from the Metrics 2.0: Business & Market Intelligence web site.)
Such numbers provide an expensive hint that too much stuff that don’t fill a need is produced. The size of the marketing and advertising industries wouldn’t be so gigantic otherwise. Production under capitalism is for private profit, not to meet human needs. To achieve those profits, vast efforts must be made to induce spending.
The latest Internet scandal, the harvesting of data from 50 million Facebook users by the secretive company Cambridge Analytica, can be seen in this light. The immediate scandal is that Cambridge Analytica, a company created by extreme Right hedge-fund billionaire Robert Mercer and former Trump consigliere Steve Bannon, sought to manipulate elections in furtherance of their fascistic ideology. But there are plenty of multi-national corporations who would dearly love to get their hands on such troves of data. Whose to say some haven’t already? We don’t know.
Perhaps enough of these episodes will induce some naïve technology fetishists to re-examine their thinking. Why should corporate spying be more tolerated than government spying? An ex-son-in-law of a friend, prompted by being asked what he does for a living, actually saw himself as providing a necessary service when he explained how he works for a technology company to tailor advertising to the profile of a user, complaining that non-tailored advertising “would be a waste” — for the recipient of the advertising!
Those who work to create a better world sure have a lot of work to do.
Systemic Disorder 
Reblogged this on Ned Hamson's Second Line View of the News and commented:
Timeless words.
We do have a lot of work to do. What about legislation: Limit of income of $200,000/yr, assets limit of $250,000 for anyone running for Congress or in Congress? Ratio of 12:1 or CEO pay to that of lowest paid worker, both to have equal benefits? Break of big banks? PO to return to banking as part of services (read Ellen Brown)?
The BIG questions: How to even get this legislation written, brought before legislatures at state and national level, and passed and not overturned.
Even BIGGER questions: How to replace majority rule with consent as practiced by Sociocratic governance?
All excellent questions and starting points, Deborah. Either a maximum ratio of pay (which should be much less than 12-to-1) or a maximum wage, which could be set at the salary of the president or prime minister, depending on form of government.
One thing I am certain of is that banking has to become a public utility, with no more speculative finance. Ellen Brown has some good ideas there, and we can go much further than the Bank of North Dakota. The Left Party of Germany has interesting ideas of how to bring banks under democratic control, which I discuss at this link. Interestingly, Sweden and Norway nationalized their banks in the early 1990s due to banking meltdowns, but promptly handed them back, which is discussed at this link.
What is ultimately needed is a replacement of capitalism, not a reform, but we do have to start with the most thorough-going reforms we can achieve, and advance from there. It will take much organization and a long-term vision; there is no substitute for those.
I myself am still sitting on the fence as to whether or not private businesses should be eliminated.
At the moment I lean to an answer of no. The current system is clearly broken. But my final answer of what should replace what we have now will not be due until AFTER there is a revolution. I do not think that the current world socio economic system is capable of being fixed through an electoral process. I would put the chances of that happening at zero percent. I would put the chances of changing the system for the better through unconventional means at about 1%. So it seems to me that it is 99% certain that things will only get worse until humanity becomes extinct. But if this 1% actually did happen I think that it would be fair to call it a revolutionary event that came about as the result of a revolutionary process. It would be accurate to call those who would have steered events to achieve such a result as revolutionary.
If such unlikely events were to come to pass how could we know that those taking the reins of power are actually intent on ruling for the benifit of humanity rather than just ruling for the benifit of a differnet faction of the 1%. Well the first sign would be the arrest of the Generals.
Then reforms like those mentioned by Deborah would have to follow. In addition to a maximum family ncome of 250,000 a year there would have to be a job guarantee for those capable of working and a reasonable guaranteed income for those incapable of working.
I am just now getting to the main reason that I am writing this comment. This is my question.
If income taxes are so progressive that it is not possible to earn more than 250,000 dollars (euros, pounds, franks) per year and taxes on unearned income are so progressive that it is impossible to make say, off the top of my head 75,000 dollars per year, and inheritance taxes are so progressive that people can not leave a fortune to their children would that not destroy the incentives that cause people to act in a psycopathic or sociopathic manner which is crucial to the barbaric excesses of the capitalist system?
I have a lot of doubts about whether socialism can succeed. I have even greater doubts that socialism can succeed in a society in which the people have not been conditioned for it. In my opinion progressive taxation and doing work that actually contributes to the SUSTAINABLE needs of society are two crucial conditioning policies that a population needs to be exposed to.
The history of socialism is not one to inspire great confidence. A lot of discussion takes place explaining these past failures. One thing that I do not see mentioned often is that socialism is COMPLEX. Under changing global circumstances agreements previously agreed can easily breakdown. A strike by bus drivers in a capitalist system could be a revolutionary act of an oppressed group. A strike by bus drivers in a socialist country is clearly and unambiguosly a counter revolutionary act.
Of all the brands of socialism that I have come across the only one that I have any confidence in is Parecon. If I am not mistaken though there are Marxists who would not even call Parecon socialism. I do think that it could just as easily be called Guildism. But to repeat my question, if we live in a society in which it is illegal to become rich (but not comfortable) do we need Parecon?
We do need a whole different economic system, and people will have to be socialized into it, just as people today are socialized into capitalism. A 100 percent income tax above a certain level would be one way to enforce a maximum wage, at whatever level.
If you don’t mind me getting technical for a moment, we can’t say the history of socialism doesn’t inspire confidence because there never has been a socialist country. There have been post-capitalist countries attempting to make a transition to socialism that failed to do so (the Soviet bloc) and some countries that attempted a mixed economy (such as 1980s Nicaragua). We can’t grasp the fate of these societies without understanding the massive, unrelenting attacks on them. That is not to say there weren’t internal problems — there were — but we have to examine these in a full context.
Having said that, whatever the future holds won’t be a repeat of the Soviet model. It will something different, something that we should have some broad concepts ahead of time but the details of which can only coalesce in the making of a new society. (I wrote a whole book discussing these concepts, so far too much to go into any detail here.)
I have not studied Parecon, so I am in no position to pass any judgment on it. Good, however, that there are folks thinking about what a better world might look like. We must be for something, not simply against capitalism.
Allow me to mention another word on Parecon. My own personal favorite point that I picked up from reading one of the economists who was promoting it is that humanity has to take a whole new look at how we divide up the work that needs to be done by people. Even if financially speaking we were all much more equal there would still be class warefare if some people have the best jobs and other people have shitty jobs.
The author whose name I forget said that we of course can not do away with job specialization.
But he did say is that the work week, or month, can be divided between your main job which you could spend say 75% or 80%of your work time doing and a second job which you spend the rest doing.
So if full time work was still considered 40 hours per week you would do one job for 4 days a week and another job for one day a week. For example if you have a nice cushy job like an accountant you would do that for 32 hours and then work 8 hours as a janitor even if that meant working as a janitor at a different location. What the janitor would do would depend on his/her background.
if at all possible they would get to work at a higher level position, even in say accounting for thier 8 hours. If that really is not possible then they would work at an equivelant level, say as a security guard. If that is not possible, for example they have Downs Syndrome, they can work as a critic, even if they have to work at a differnt location. Yes society needs critics and it is not something that needs a lot of formal training nor the ability to do calculus. For example they could be assigned to a resturant inspector. They go with him to the locations that he is supposed to inpect for the day. On that day the government will pay him/her to sample something from the menu from each resturant. Giving an honest opinion of the taste is his job for the day. That may not seem like much. But do reporters not make a decent living from doing nothing but that?
With this different division of labor people in better positions would hopefully develope some humility and when they are making management decisions will think twice about creating policies that WILL effect them for at least one day a week. People who have physcially demanding jobs will get a physcial break. Those who have repetitive jobs will get one that requries more creativity.
If those improvements can not be made for them on that day of the week it should not be unreasoable to just give them the day off with pay.
I really like the approach the Swiss are taking with their Vollgeld referendum to be voted on in June. Instead of nationalizing the banks, they would simply end their ability to create money (out of thin air). 98% of all money in circulation is created by private banks as either public or private debt. If the referendum passes, banks would become like credit unions, ie they would be allowed to lend money they have on deposit but would not be allowed to create new money.
In this way this restores money creation to the government – this is what Venezuela is doing with the creation of the Petro (backed by their oil reserves). Russia and Iran are also talking about issuing sovereign money backed by petroleum resources, rather than borrowing it from Wall Street banks.
I really like the economic school known as MMT. Think Warren Mosler or Bill Mitchell, or the blog New Economic Perspectives written by proffessors in the economics dept. of the U. of Kansas City, Missouri. The Vollgeld referendum that you mention seems to be something that would be supported by MMT leaders.
The libertarians say that MMTers are over selling what soveriegn money can do as wealth is created by production not creating money. They miss the point. When the government creates money is can determine WHAT KINDS OF GOODS AND SERVICES (WEALTH) get created. That is the tactical advantage that it can offer.
Call me a skeptic on this one. It seems to me the Vollgeld referendum, if passed (although that appears to be unlikely), would unnecessarily restrict the money supply. It’s not going back to the gold standard, a truly awful idea, but it’s a big step in that direction. The central bank would be able to create all the money it wants. (Remember that the U.S. Federal Reserve created $4.1 trillion that was pumped into buying bonds, and when we add the similar programs of the European Central Bank, Bank of England and Bank of Japan we are in the neighborhood of $7 trillion.) All that spending did was inflate stock-market bubbles and, secondarily, boost real estate prices.
Was there any public good in that? None that I see. So the problem isn’t which entity “creates” money since neither commercial, investment or central banks have any democratic control. I believe it would be more productive to democratize the banking system, reducing it to a public utility under democratic control.
If the money supply is restricted, then the inevitable recession and/or economic crisis would be made worse. Moreover, there is nothing inherent in restricting money creation to a central bank that would stop the central bank from bailing out banks, nor does it democratize banking. It might even lead to more bank bailouts.
I realize we need reforms now and can’t wait for some future revolution to sweep away capitalism. I don’t doubt the sincerity of those people promoting this referendum. I just find it deals with symptoms, not root causes, and doesn’t necessarily deal effectively with those symptoms.
I think you have made some mistaken assumptions about the Vollgeld referendum and it would be worthwhile for you to investigate the sovereign money issue further. In the first place the Swiss central bank, like the Federal Reserve, is a private institution and the goal of the referendum is to get money creation out of private banking hands and to put it in the hands of a government controlled monetary commission charged with issuing sufficient money to keep the economy ticking over without producing either inflation or deflation.
The problem we currently face is that banks arbitrarily restrict the money supply because it assists them in asset accumulation. The goal of turning this over to a publicly accountable body is to end this type of restriction.
Your assumption about sovereign money (a fiat money system) leading to a resumption of the gold standard is also erroneous. The vast majority of sovereign money advocates reject using precious metals to back money because this always leads to bankers manipulating currency values when they speculate in the precious metals.
I have always felt it was a great shame that Marx never addressed the issue of private bank creation of money in Kapital (it’s been going on since 1694). If we had addressed this issue 100 years ago, it would have been much harder for powerful banks and corporations to derail our organizing efforts.
A resource I think you would find useful in better understanding this issue is Sovereign Money: An Introduction
https://most0010122.expert.services/includes/download.ashx?ID=147896
I read the first several pages of your link. My two immediate thoughts are 1) be careful who your allies are and 2) this “sovereign money” proposal is a gimmick that leaves the structural issues of the capitalist system untouched.
Originators include Frank Knight and Milton Friedman, and is positively reviewed by the International Monetary Fund. Right there, we might wish to pause for thought. Milton Friedman I presume needs no introduction. Frank Knight is another prominent Chicago School economist who wrote in a leading academic economic journal that professors should “inculcate” in their students that the theories of standard classical economics are not debatable hypotheses, but rather are “sacred feature[s] of the system.”
I might also again note that the Federal Reserve is not private; it is part of the Treasury Department. Private companies do not have chairs and boards appointed by the president and approved by the Senate. Let us set that aside for now; I believe we are in agreement that there is no democratic control over finance and that needs to be rectified. The problem here is that this plan does nothing to institute democratic control; there are no checks on central banks. Putting all decisions in the hands of central banks thus does nothing to democratize the economy.
The “sovereign money” system would not lead to the resumption of the gold standard, as you write. It would be a step in that direction, however, because this system would tighten the money supply, risking making the next inevitable recession worse. Money would not be tightened to the degree that a return to the gold standard would entail, but there would still be less flexibility. It seems to me this system would create an extreme centralization that would be unhealthy, first because it would put immense power in few hands (there are no democratic checks here) and no small group of people can remotely have sufficient information to be able to make such a vast array of decisions.
The issue here isn’t the good intentions of folks like you promoting this system; it is the practical results that would likely flow from any implementation. Modern capitalism can’t function without credit, including the ability of institutions to make short-term loans. Making capitalism function even worse than it already does when we are in no position to replace it with anything better (let us acknowledge the present correlation of social forces) strikes me as a bad idea. I say again we need to tackle the root causes of economic problems, not symptoms. Yes, private banks triggered the 2008 global downturn, but not because bankers are necessarily evil people but because of deep structural problems and the development of capitalism under its internal logic as it morphs to deal with crises.
I clicked on that link too. It was I think around 60 pages long. I really am not interested in reading such a long link now. But ideas about soverign money are not ideas of the rightwing. One of the “cofounders” of MMT Bill Mitchell an economist at the U of New Castle in Austraiia says that he has been more influenced by Marx than by Keynes.
One of the key insights of MMT is that politicians can not say that there is a lack of money to undertake a government program. There might be other reasons not to support a specific proposal but lack of money is not one of them.
The reason is that government spending is not funded by taxes or borrowing. In FACT A GOVERNMENT MUST SPEND BEFORE TAXES OR BORROWING CAN EVEN EXIST. Therefore society should probably not in refer to government outlays as spending but as INVESTING as when ever the government spends one dollar it creates one dollar of ASSETS for either private individuals or society if for example the spending would be for a public project such as a road. MMT proponets will admit that government INVESTING could be inflationary. But only under some conditions. I say inflation rates of up to 20% per year are better than unemployment rates of greater than 4% anyways. MMT also explains why current mainstream thinking about government financing actually creates economic crisises. Of course those in power know that what MMT teaches about how government financing actually works is true. They just do not want the rest of us to know that it is true or they will not be able to get away with telling their massive lies any longer.
Below are some much shorter links.
http://bilbo.economicoutlook.net/blog/?p=38964
http://neweconomicperspectives.org/2018/03/the-big-three.html
These are the sources where one should start.
I read the second of your two links, Curt, and unfortunately it failed to make its case. I am not actually sure what the case is that it attempted to make, other than so-called “fiat” money apparently being responsible for global warming. In response, I will refer to my writings on “green capitalism” rather than repeat myself. I will say that changing the banking system (assuming that is what the author in question is advocating) will have no effect on global warming as long as capitalism is allowed to continue on its merry way.
I do not doubt that the proposed “sovereign money” system has sincere advocates from the Left. Clearly it is not simply a Right-wing idea. What I am suggesting is that when some of the notorious right-wingers around advocate for something, we ought to stop and give it a second think. Take the concept of a universal basic income. Mostly proposed by people on the Left who are completely sincere. No question there. But when you have the likes of Milton Friedman also advocating it, one must look to see why.
The answer in that case is that Friedman saw a UBI as a replacement for social-welfare programs, one that would provide much less and be quite insufficient for people in serious need. UBI advocates on the Left say “That’s not what we want.” I know that; in contrast they want a UBI on top of existing wages. But we have to look at what we would get, not the good intentions of advocates. Capitalists would cut wages arguing that you get a UBI and don’t need so much, and social services would be cut. That’s the reality that has to be faced. So we have to face how a reform is apt to be shaped, not insist that the good intentions of advocates will be the outcome.
Jaein, that means yes and no.
Yes, my understanding is that prohibiting private banks from creating money could certianily restrict the money supply. It is my understanding that the reason that we always hear so much bull shit about the seize of the (a) governments budget deficit ultimately goes back to private banks. They see the government as their compition. Bankers want to restrict the ability of governments to create money so that people need to come to them for money rather than go to the (a) government. But of course just because a government can create money does not mean that those in charge of creating the money will use this power to direct national resources to be used to meet the needs of the general welfare. It seems to me that if you want someone directing resources to meet human needs there is zero percent chance that such a thing will happen if private bankers are deciding who gets money and for what. The chances that someone working as a government employee would direct resources for the benifit of most of would be decided I guess by whether such a person was an agent of the rich or an agent of someone who is not so rich.
It is my understanding that the leaders that we have now have absolutely no interest in promoting the general welfare on either a national or international scale because those types of policies would increase the purchasing power of the masses both nationally and internatioanally. With such an increase they would pose more compitition to the wealthy. So the bottom line of the behavior of the rich and their collaborators is that they have to be appearing to most of the rest of us as actually trying to solve problems while in reality they are working to perpetuate them.
They have managed to continue this con successfully for at least 2,000 years. The addictions and fears of the rich prove that they are psychologically unbalanced. But in the past in was quite difficult to dispose of them. Now it has become even more difficult because the methods of population survellence are much more sophisticated.
OOps I should have read the reply of Stuart before I wrote my own. Maybe they crossed in the mail.
@ Systemic Disorder Re: 7:14 pm,
That is an interesting, reasonable, interpretation.
Well Tubularsock has created a Tubularsock Bot to answer all his email so Tubularsock could spend more time on the beach.
The end result, the Tubularsock Bot arranged with a Maserati Bot a car deal that has put Tubularsock in incredible debt!
The bright side of this economic dilemma is the Tubularsock Bot and the Maserati Bot are now dating.
Now who would even pretend to believe bull shit like this? Well, 50,000 Facebook users!
But the bots believe it …
One of the many reasons I watch as little network TV, (I don’t have cable) are all the ads for crap we don’t need. The advertising industry is helping to drive the industrial production of ‘stuff’ all while depleting resources just to keep the wheels of capitalism turning. I’ve never been a “brand” man; after all it amounts to advertising the “brand”. Pay extra for the name and give them free advertising. I do have a Facebook account but rarely use it as I was late to the PC game, 05-2014 so I’m exactly sure how it works. I did find a wealth of new good music which I then purchased. I use email for messages or my new Medium account. https://medium.com/@jrallen1200 . We are all watching things deteriorate with business as usual with no alarm, at least from MSM outlets. Some of the newer tech items I’m unfamiliar with. Seems Google has changed and been made impossible for searches so now I use Bing. It does seem as though censorship has reached its tentacles into the net and things are being ‘disappeared’. Peace
It’s amazing how willing people are to advertise even without being paid. Many years ago I was on holiday in Cancun, Mexico, with three friends, each of whom insisted on standing on a long line to enter a famous chain restaurant so they could buy a T-shirt with the chain’s logo. When they finally came back (I refused to join them), I said to them, “Don’t you realize you just stood in line 45 minutes to pay them to give them free advertising?” They just shrugged.
BTW, I can’t figure why WordPress keeps moderating you, so sorry for these holdups. May I suggest truncating the address to which your name is attached? There are further addresses attached to your Medium address and perhaps that is confusing whatever algorithm controls.
Monetizing our own influence without actually doing anything, crazy but nowadays possible. Exciting and frightening at once.