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THE REIFICATIVE ROOTS OF THE GLOBAL FINANCIAL
CRISIS.
The world wide emergency of major financial
insolvency and bankruptcy is already transforming
the world and with it the lives of millions
of people. If the collapse of the banks and
the deserved demise of the impotent, formerly
upwardly mobile and now downwardly and very
much declivitous, incompetent, dabbling,
interventionist transcendentalist dupes who,
though employed in positions well above their
competence levels, have been in control of
the money markets, are allowed to cock up
capitalism for much longer, the very real
risk is that the world faces an economic
slump of proportions not seen since the 1930s,
with all the human heartache that entails.
Are we to experience again the contracting
of our economies? Will the current incipient
protectionism which restricts the importation
of some cheap consumer goods from third world
countries be allowed to run rife and stimulate
a wholesale movement of starving blacks to
clamour for entry at the borders of the EEC?
Will there be a rise in mass unemployment?
If that happens it will almost certainly
engender a big increase in crime and racial
tension, being the classical mechanism of
the white Christian response to societal
hardship throughout all levels of Western
society as a way of redirecting and deflecting
reificative blame onto the backs of folk
from other ethnic backgrounds on the part
of the guilty frustrated believer in delusory
abstraction, as it did in Germany between
the wars as witnessed by the Nazis Hitler
and Heidegger amongst millions of others
of thes self styled master race. Such developments can provoke serious geopolitical
turmoil – and war. The potentialities are
for utter chaos, which is such a horrific
prospect it is abominable even to contemplate.
Karl Marx's economic and political analysis
of the burgeoning capitalism of the nineteenth
century and his prescription for bringing
about change to the politico-economic horrors
of the worker-capitalist relationship were
eclectic in that much of the language that
Marx employed to promote his message of the
possibility of change was couched in what
seemed to be the best and most compelling
of the various styles or rhetorical forms
available. The powerful and compelling opening
line of the Communist Manifesto is a foretaste of the reificational metaphysical
menu within.
"A spectre is haunting Europe -- the
spectre of communism."
[1] (Marx & Engels 1890. p. 1) |
It must have frightened the shit out of the
European ruling class, particularly as most
of them believed in spectres, God, ghosts
and things that go bump in the night - which
includes the bump of bullets on the walls
of their palaces from the discharged rifles
of revolutionaries.
He had obviously already grasped that the
only effective language capable of swaying
the masses over to his ideas was the very
reificative abstraction that was being used
against them, by the church, the gutter press,
the parrot-type, rote-learning which passed
for working class education in those days,
and by their industrialist and political
masters. My mother at the age of 92 was still
word-perfect in a hymn to the German Kaiser
learned parrot-fashion in her working-class
crap-crammer in 1910.
(For readers who may be interested in seeing
this poem which characterises the
false bonhomie between Britain and Germany
prior to WW 1 - here is the link) |
It seems obvious to us now at this distance
that he would choose to concentrate on a
reificative nomenclature which out-concretised
the top-hatted thingifiers of“labour, production, profit and entrepreneurial
enterprise and just reward.” Marx embarked upon a thingification-enterprise
himself – the project of fighting the capitalist
class with a form of noble reification redolent
of Plato's notorious noble lie on behalf
of his clique of lying, reificating, paederastic
Athenian aristocrats - but Marx's hypostatised
abstractions were of a sanitised, humanist,
democratically acceptably working class variety.
Although the Hungarian Marxist György Lukacs
was well aware of the ontological distorting
mirror of reification and wrote the quotation
below, he failed to identify the reification
in his mentor's own writings. The truth of
the matter is that Marx and most critics
of linguistic reification, including eliminativists
like me, find it very useful to employ reification
in our criticisms of reification, mainly
because it is so embedded in our language
and makes light work in areas of persuasion
(the politicians, lawyers and the church
love it for this reason) and secondly because
we have been as much brainwashed by it from
birth as anybody else. The big difference
of course is that they truly believe in the
existence of their Platonist phantoms and
we make known our contempt for it overtly
and merely exploit thingification instrumentally
as useful rhetorical fictions on the basis
of: "why should the devil have all the
good tunes?"
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"Just as the capitalist system continuously
produces and reproduces itself economically
on higher levels, the structure of reification
progressively sinks more deeply, more fatefully
and more definitively into the consciousness
of man." [2] (Lukacs. 1971. p. 93)
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Thus as
Mike Rooke of Ruskin College, Oxford points out [3] (Rooke. 1998)
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Georg Lukacs begins the chapter in 'History and Class-Consciousness'entitled 'Reification and the Consciousness of the
Proletariat' Following Marx's analysis in the first chapter
of Capital, and in particular the section
entitled ' The Mystery of the Fetishistic
Character of Commodities', he identifies
the essence of the commodity structure of
capitalism as its tendency to make the social
relations between people appear as relations
between things, possessed of an autonomous
power and objectivity. This commodity fetishism
is, he claims, both an objective form and
a subjective stance corresponding to it,
by which he means that it is no mere illusion,
but rather the actual lived experience of
people in capitalist society. [4] (Lukacs p. 197)
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| A General Theory of Reification |
My General Theory of Reification splices together elements of nominalism with
an expanded, societal version of the Churchlands'
neurologically orientated eliminative materialism
with a full-blown eliminativism. It comprises
of an ontological analysis of almost everything
under the sun, from logic and science to
the problems of freedom and religion, from
biology and politics, to education and the
natural language of the road-sweeper and
the refuse-collector. This means that any
abstraction or obvious reification like: *being, mind, consciousness, reality, existence,
knowledge, movement, energy* etc., is *up for de-constructional grabs.*
The disparate theories fit like a glove and
together form a very powerful form of philosophical
argument which the poor trannies have never
experienced before. To date, most of them
thrash around gasping in their reificative
life belts like fish out of water and nobody
has come up with any viable arguments against
it - because - it is a new form of anti-platonic
attack system, which has the destructive
force of an existential exocet missile.
Historically there are three main anti-reificational
philosophers, all of whom are now dead, I
respect the ideas of this trio in particular.
The first is the great Polish philosopher
Tadeusz Kotarbinski. I have most of his stuff
in English displayed inThe Athenaeum Library of Philosophy. James W. Woodard was an American author,
a professor who wrote in the thirties and
forties, his great work (practically unknown)
is his Intellectual Realism and Culture Change. (a foundational book, but almost impossible
to find nowadays) I had to employ a specialist
book-finding agent in order to secure one
- he eventually found a copy in a small village
bookshop in Alabama.
The third one is of course the Hungarian
philosopher György Lukacs, but like Marx
(who he worshipped at the time - he had to
in order to survive in Communist Hungary)
) he mainly deals with the Marxian theory
of the reification of labour, money and profit
etc. Ironically, of the three, Lukacs' work
is more reificationally relevant right now
in view of the latest breakdown in the banking
systems of the global community.
The present serious financial crash is a
classical result of monetary reification,
with an ass-about-face concentration on the
predicational belief in a global societal *financial network* with a childlike faith in a reified *pseudo-stability* based upon a reified version of a non-existent valuta winging its way to and fro in cyber-space
between far-flung lending nodes.
The directors and service chiefs are completely
naive idiots who spend their time between
playing golf and hypostasising the ability
of their institutions to go on lending more
and more money ad infinitum to insufficient
and incompetently appraised recipient-subjects
of dodgy loans to buy houses they can't afford
by lending five or sometimes 6 times annual
income without any deposit etc., whose credit-worthiness
was simply based on the fact that they had
an address, a telephone number, could speak
English and a burning desire to borrow money.
The computers the moronic money-lenders use
for this abstract hyperspatial activity have
of course all been programmed with the same
reificative shit that their programmers employ
for their fantasies of credit-worthy ness.
Now the whole reificational mess has come
crashing down around their ears and we have
to suffer for their moronic trannie stupidity
too. At stake are our present manifestations
of man's technological genius, and last but
not least the ultimate stake and fate is
that of our civilization. The trannies have
H-Bombs now.
Of the three philosophers, Woodard is more
sweeping commentator with a wider view of
the reificative landscape and in his book
he identifies the effects of reification
on practically every aspect of human behaviour.
I might scan his book and but it in the library
- I wonder if 1935 means it is out of the
copyright period in America now?
Tadeusz Kotarbinski is more structured and *scientific* with his *reism,* and like Lukacs concentrates on Marx's
version of reification.
The central thesis of Woodard's book is that
the pristine tendency of the human mind is
toward intellectual realism, that the long-term
tendency is towards a clearing of the trannie
fictive faeces clogging up the Augean stables
of philosophy and to a much lesser extent
science. For Woodard, all that all individual
and cultural development consists of a constant
process of correction and refinement in the
direction of "reality-contactedness." This process is thought of mainly
in terms of biological or evolutionary differentiation
and adaptation. Reality is accepted as the
common-sense-reality of the Nominalists. "Intellectual realism," thus understood, signifies the inherent
tendency of the *mind* to deposit moral and intellectual concepts,
principles and ideas as encumbering dross
in that process of growth and adjustment,
and to take them and hold to them as absolutes.
"Reification," then, "except
for its connotation of depersonalisation"
is not essentially different from what is
ordinarily called hypostatisation. According
to the author there are various types of
reification, which may be classified as follows:
(1) The conceptual extension of perceptual
reality;
(2) The hypostatisation of the relational
into the existential;
(3) The projection of the fictitious into
concrete reality;
(4) The transposition of the merely subjective
into the objective;
(5) The interpretation of the particular
and relative as general and universal;
(6) The assertion of the problematic as self-evident;
and
(7) Negative reification, (de-reification)
which stresses the claim to exclusiveness
contained in many positive reifications and
is therefore "only an obverse aspect
of some one of the above mentioned forms." [5] (Woodard. 1935. pp.9-13) |
Addressing the more devious forms begetting
wealth, such as the derivatives market, that
most people would indentify precisely as
the method of obtaining profit
via invisibles unethically, and surely falls under the category
described in the bible as usury, or the act of lending money at an exorbitant
rate of interest without any physical or
mental contribution whatsoever, Dr. Rooke
refers again to Lukacs as he illustrates
the effects of reification with the category
of interest-bearing capital (or money generating
money).
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In this case the social relation which generates
value (the capitalist who buys labour power
and puts it to work extracts surplus value
and thus augments the value of his capital)
is obscured by the relation of money to itself.
The actual transformation of money into capital
becomes invisible, a form without content.
Marx says that in this reified form of thinking,
money acquires the property of generating
value and yielding interest - we arrive at
a fetish form of capital. The reified category
of 'capital-interest or 'capital-profit'
is complemented by those of 'land-ground
rent' and 'labour-wages', the economic trinity
of political economy as Marx calls them.
[6] (Lukacs. ibid) quoting [7] (Marx.
1957. p. 48)
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Following the two great world wars of the
twentieth century, Marx's successfully polarised
thingification of the mutual activities and
behaviour of the capitalist speculators and
their exploited work-slaves evaporated back
into the mist-covered shelves of Plato's
emporium of reificational forms and transcendent
templates from whence they came. The intervening
period which, though short term by historical
standards, lasted right through until the
time following Gorbachov's failed attempts
at a reform of the Communist state —characterised
by the usual welter of gerundial abstraction
characteristic of tyrants or a dominant social
strata desperate to hold on to power.
But Marx bequeathed us a powerful insight
into the way in which reification and the
concretisation of abstraction comes into
being and how it is applied, Dr Rookementions
Rubin who in 1923 published his Essays on
Marx's Theory of Value. and Rooke supplies
us with the following quotation from this
work: [8] (Rooke. 2007)
In the opening chapter, addressing Marx's
Commodity Fetishism and Reification Theory
of Fetishism, Rubin declares:
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Quote: ''Vulgar economists' (the representatives
of political economy after Ricardo), employ
categories such as value, money and capital,
which are considered not as expressions of
human relations 'tied' to things, but as
the actual characteristics of the things
themselves. They come to focus exclusively
on, and study, the 'natural-technical' characteristics
of these things, believing that it is in
the analysis of the movement of these that
the true science of economics resides. It
is the reification of production relations
therefore which considers the social characteristics
of things as natural characteristics belonging
to the things themselves. 'Vulgar economy'
remains imprisoned within the reified conceptual
limits of capitalism. Insofar as it only
considers the quantitative relations between
fetishised categories it can neither arrive
at a real understanding of the mechanism
of capitalist production, nor provide a prescription
for its transformation.'
[9] (Rubin. 1972)
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| The Fall of the Soviet Union |
Thus it was from the lips of Michael Gorbatchov
that the west came to hear of the latest
series of reificative linguistic instruments
of metaphysical transcendentalist manipulation
being the so called hypostasised reforms
called uskoreniye(acceleration) glasnost (liberalisation, opening up) and finally perestroika((restructuring. ) It was too late. The ascendancy
of the metaphysically mysterious over the
physically obvious was over and Marx’s reificatively
inspired revolution ended with the destructuring
and eradication of real, steel-wire and concrete
and down with it came the abstractive concatenational
chains which formed the internalised mental
bonds of totalitarianism. The real bricks
and mortar material of the East Berlin wall
tumbled and down with it crashed the thingified
pseudo–entity of Socialist Freedom - a shattered concrete symbol of a separated
hammer and sickle lying in the brick-dust..
The final act ensued with the storming of
the building in which the traditionalist
rump or junta which represented the last
gasp of communism cowered as shells fired
by Russian army tanks exploded into the fabric
of the building whilst a drunken Yeltsin
swayed, smiled and waved from a gun turret
pronouncing the cabal's actions illegal.
Declarations of independence by the constituent
republics followed shortly afterwards with
the abolition of all-Union institutions and
the transfer of their assets to the republics.
Increasing international acceptance of these
developments sapped what little strength
there had been in the Union. On February
7, 1990, the Central Committee of the Communist Party
of the Soviet Union agreed to give up its monopoly of power.
This was a radical historical change, as
control of formerly suppressed citizen-generated
reification critical of government leadership
was relaxed and people were now free again
to conjure up as many meaningless religious
or transcendentalist dualist abstractions
as they had been able to do so in Czarist
times (as long as those criticisms were not
levelled against the royal family or the
Czarist state of course. With the abolition
of the suppression of government criticism.
which had previously been a central part
of the Soviet system, the gave way to a spate
of public and media adoration and repugnance
for the system which lasts to this day.
Thus the traditional, specialised Marxian
type of reification was a dead in the water
and the scene was set for an orgy of abstractive,
triumphal western capitalistic reification
that would reverberate through the corridors
of government, industry, commerce and academia,
manifesting its most virulent form in the
conduits and cloacas wherein bobbed and floated
the personal and corporate evacuant deposits
of pecuniary abstraction and virtual money
on their way to the globe wide gambling dens
or sewerage farms in which bathes the naked
speculators in an orgy of short-and long
term debt, anal retention and private and
corporate self deception.
As a retired Sales Negotiator and subsequent manager of the North West Urban Renewal Sales Department
for Wimpey Homes (Britain's largest homebuilder) the recent
unrealistic income-to-borrowing-quotient made my hair stand on end. It began with
the idiot mortgage lenders that retained
credit risk (the risk of payment default)
and were the first to be affected, as financiers
of the naive house-purchasing borrowers,
totally bewildered by being offered vast
amounts of money which their meager incomes
predictively guaranteed would never be any
chance of them servicing became unable or
unwilling to make payments - it ended in
the collapse of many of the world’s leading
banks and other corporate building societies
and other borrowers pawn-shops, it ended
too in the casinos of the futures markets,
were risks that would raise the hairs on
a croupier's neck at Monte Carlo took place
every day.
But most notoriously of all – in the reifications
of all reifications – the mother of all euphemisms,
commercial mega-lie of all time – the subprime
mortgage crisis (a term that will live in
infamy) characterised by a contracted liquidity
in the global credit markets and banking
systems. It was a reificative undervaluation
of real risk in the subprime market is which
cascaded, rippled and ultimately had its
effects in even the most humble of the outposts
of the world economy, including of course
the very ex-Soviet citizens who had clawed
down the reificative barriers of one socio-political
abstraction only to be confronted with another
system of mass-reification where global,
metaphysical macrophages borrowed money from
other monetary phagocytes; with which the
gobbled up any free cells that were vulnerable.
As with the Soviet hierocracy there was a
similar credulous faith in the ordained teleological
omnipotence of the globally structured financial
arrangements which cloaked the nature of
the real world until the whole house of cards
collapsed putting a quick end to the metaphysical
mess in a cognitive clutter of obfuscation
and surrealist fantasy.
The Derivatives Monster
Out of all the incredible financial developments
of the 1990s, one of the most important fundamental
structural changes in the nature of the operation
and interaction of the global financial system
was the literal explosion of the use of derivatives.
Derivatives are often highly complex financial
instruments that "derive" their
value from some other underlying asset. As
the use of these instruments evolved and
advanced to a stunning degree in the 1990s,
an intriguing bifurcation of opinion on the
merits of the hybrid instruments developed.
Among the Wall Street power players and aggressive
private speculators, derivatives were seen
as a wonderful financial innovation that
would lead to highly customizable risk management
and a huge new profit stream for Wall Street.
Outside of the financial halls of power,
however, derivatives began to acquire a reputation
of being staggeringly risky financial instruments
that could turn sour in a heartbeat and devour
the financial wizards who created them like
hungry sharks. Like the young sorcerer's
apprentice in Walt Disney's classic 1940
masterpiece "Fantasia", a general
public perception of derivatives gradually
evolved that perceived the growth of derivatives
as a dangerous experiment being recklessly
played out in the financial world. Like the
sorcerer's apprentice dabbling in powerful
magic when the master was not around to manage
the unleashed forces, derivatives creation
was increasingly seen by the average investor
as being hazardous attempts to harness enormous
financial tides and forces that were simply
too big and too complex to be decisively
tamed. A string of massive derivatives debacles
in the 1990s helped buttress this negative
popular perception of derivatives and provided
strong support for the "derivatives
are very dangerous" side of the great
derivatives debate.[10] (Hamilton. 2008)
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So what now?
According to commentator Edmund Conway writing
in The Daily Telegraph Britain's most right
wing newspaper, there are five ways in which
the financial crisis is already changing
the world:
1. The world is about to take a major leftwards
lurch. Welcome to the 21st century’s first
bout of soft-socialism. The last time there
was a comparable period of economic and financial
turmoil, coupled with record inequality both
within and between nations was – well, that
was the 1930s again – but the fact is this
is classical social democratic territory.
This big shift is still in its nascent stage,
but when the recession takes hold over the
next year or so I suspect parties of all
hues will be shuffling swiftly away from
the free market and towards the side of greater
state intervention and more wealth redistribution.
2. Coupled with this, the return of major
re-regulation for the first time in decades.
After all, there has to be a quid pro quo
for the billions of dollars/pounds of taxpayer’s
money put at risk in order to shore up or
save those financial institutions that are
salvageable. A ban on short-selling is only
the start of it. The financial sector will
be more heavily regulated than it has been
since the Big Bang sounded the modern City
revolution 22 years ago.
3. The City will no longer be the most attractive
destination for Britain’s brightest graduates.
This is a serious about-turn. When I was
at university at the turn of the millennium,
careers in corporate law, management consultancy,
investment banking, private equity and hedge
funds (more or less in ascending order) were
the target for many of the smartest graduates.
There will, of course, still be extremely
lucrative positions in the City, but with
regulation clamping down hard, with investors
more tentative than ever and – most importantly
– with far less capital sloshing around over
the next five years or so, those jobs will
be far scarcer. This is good news. Britain
is home to some of the world’s most intelligent
people, but until recently they had been
holed up in the City working on spreadsheets
and financial weapons of mass destruction.
Many other industries will soon see their
talent deficit reversed. Those particle physicists
who were working on complex derivatives for
a hefty sum may return to science. I wonder
if the phones at the Large Hadron Collider
are already ringing. Perhaps some will beat
a path towards financial journalism, though
I imagine that might be that little bit too
much of a remuneration shock.
4. The return of real meaty, controversial
economics. Economics has been in something
of an ideological rut in the decade and a
half since the collapse of communism. The
demise of the Soviet Union, the defeat of
the monetarists, the apparent success of
inflation targeting: all of this seemed to
signal not just the end of history but the
end of macroeconomic debate. Although there
has been lively economic dialogue in academic
spheres it has mainly been over the more
arcane end of microeconomics. This is about
to change. The current consensual model,
best embodied in Gordon Brown’s claim about
having laid to rest the “boom and bust” of
previous generations, has been exposed as
hubristic in the extreme. Its high priest,
former Federal Reserve Chairman Alan Greenspan
has already suffered the most painful fall
form grace since Enron. The real debate about
how we shape the world economy for the next
20 years is about to begin, and it promises
to be a compelling one.
5. China's rise will continue, but not after
some major economic - and perhaps political
- turmoil. Though most of our attention is
on the financial markets, there are growing
worrying signs that China and the rest of
the emerging markets are heading for a major
slump. I will look at this in a later blog,
but clearly this will pose some danger to
those assumptions firstly that the emerging
market would help support the rest of the
world through the coming slump - in fact
it might make it worse - and secondly that
China's rise to greatness and world economic
domination would be fast and smooth. [10] (Conway. 2008)
Jud Evans. Sept. 2008.
References:
1. Marx. Karl and Engels. Frederick. 'The
Communist Manifesto.' 1848. /communist_manifesto.htm
2. Lukacs, György . History and Class-Consciousness
(Studies in Marxist Dialectics). p. 93. 1971.
Merlin.
3. Rooke. Mike. 'Commodity Fetishism &
Reification' Common Sense No. 23, 1998. http://libcom.org/library/commodity-fetishism-and-reification-mike-
4. Lukacs, György . History and Class-Consciousness
entitled 'Reification and the Consciousness
of the Proletariat' p. 94.
5. Woodard.James W. 'Intellectual Realism and Culture Change.' 1935. pp.9-13. The Sociological Press,
Minneapolis. USA.
6. Lukacs, op. cit, .
7. Karl Marx, Capital (in 2 volumes), Volume
1, translated from the 4th German edition
by Eden and Cedar Paul, p. 46. Dent 1957.
8. Rooke. Mike. 'Commodity Fetishism &
Reification' Common Sense No. 23, 1998. http://libcom.org/library/commodity-fetishism-and-reification-mike-
9. Rubin. I. I. 'Essays on Marx's Theory
of Value,' trans. Fredy Perlman from the
3rd Moscow edition. Black and Red, Detroit
1972. rooke
10. Hamilton. Adam. 'The JPM Derivatives Monster' Sept 2008. Gold Digest. Zeal Research. http://www.gold-eagle.com/gold_digest_01/hamilton091001.htm
11. Conway. Edmund. 'Five Ways in Which the Financial Crisis is
Already Changing the World'. Daily Telegraph. Sep 19, 2008. London.
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