In order to drum up support for Paulson’s 700 billion dollar bailout and explain the cause of a financial crisis so dire that it inspired presidential candidate John McCain to suspend his campaign, president Bush addressed the nation the other night. What he said was shocking.
The man who has been the puppet of the free market (aka de-regulated cronyism), neo-con agenda stood in front of a camera in the east wing of the White House during prime time and said that the free market economy was broken. Broken? Really? (It took you this long to notice?)
“It’s the nature of a stream to flow when there is nothing blocking it,” says the koanish theory of trickle down economics. After eight years of de-regulation, the economy should be a raging torrent, no? Every American should be swimming in piles of money like Scrooge McDuck by now.
Instead of being inundated with wealth, the average American is swimming in debt. How did this happen? To answer this question it is necessary to venture briefly into the realm of philosophy.
What is Capitalism? This is the first question we have to ask. The simple answer is that Capitalism is the effort to transform resource into capital. Heidegger suggests that the western mind is compelled to this action by Enframing. In simple terms Enframing is the compulsion to turn everything into a standing reserve. Forests become lumber, rivers become hydroelectric power, oceans become the industries of fishing and drilling. The end of this compulsion is to turn human beings and finally Being into standing reserve. Oblivion is the result of realizing the standing reserve. So says Heidegger anyway.
This is what we have seen play out in the last 80 years of American Capitalism. It is no accident that Black Tuesday (October 29, 1929) and the Great Depression came at the end of eight years of economic de-regulation by Harding and Coolidge. The cliff note version is that speculation on stocks and buying on margin falsely inflated the stock market creating a hyperreal state of economy. The bubble burst in 1929 as America got a real taste of the fruits of a trickle down economy.
The American dream, manifest destiny, life, liberty, and the pursuit of happiness–they all hang on an idea. That the the vast wilderness and natural resource that became the United States of America could never be tapped out. Looking west from the Mississippi, who would thought that the land could be tamed? American Capitalism has as its fundament the tacit promise that the resources of this land are a well of bottomless prosperity.
But who could have forseen the rates of our consumption? So, when Capitalism began to run low on the resources of the land, it turned its attention to human resources. The twentieth century saw Americans turned into a standing reserve as debt.
Finally, we are witnessing the unraveling of the Capitalist economy as investors work to transform capital itself into a standing reserve, creating an economic system that sustains itself almost completely in the realm of the hyperreal. By generating the transaction of ‘real’ economy on speculation, we discover the full and final realization of the lie that founds Capitalism: infinite resource.
American Capitalism is dead. Cheap oil, foreign investors, and American debt has kept it on life support since World War II. As the president said in his address, the free market is broken. What comes next?