I find it hard to deal with what the media insistently call the 'real' world anymore, and have been taking refuge in Robert Crease's wonderful history of Mathematics, 'The Great Equations'. Well, I write 'taking refuge', but I have been working like a wild man again and those moments of refuge are now few and far between. I'm also confined, more or less to that book, since my kindle is broken and Amazon--whose customer service is the best I have encountered--have entrusted delivery of a new one to the Royal Mail, which sundry incarnations of spastic overmanagement are attempting to destroy through forced incompetence.

So, well, here I am, Sunday morning, eggs and sausages finished and what do I encounter? The media, in full flow, in need of a clue wagon. Here's what they need to know;

a) The republican nomination for the presidency of the United States involves seven major candidates; Cain, Gingrich, Bachmann, Huntsman, Romney, Perry, and Paul. I don't know what happened to Gary Johnson. I'm frankly not bothered about Christie or Palin, who could still step in before the super-primaries and also run in caucuses, hoping for a brokered convention, but who have missed the first big tests now (barring a write-in). Neither Gingrich, Bachmann, Romney, Perry nor Paul could conceivably run well in 2016, and they know it, so they have every incentive to make this election a demolition derby. The Republican leadership don't want this, so Karl Rove will spread as much shit as necessary on anti-Romney people, but Mitt won't get traction and the rich men playing with that party--down to the level of school district elections--will end up cancelling each other out. An essentially fickle republican base which is demented, and out of touch with anything approaching reality, will face a demented street-occupying left full of the unemployed, and, in all likelihood, go so over the top (as in Ohio) that a pathway is cleared through the States for Barack Obama to win.

b) There has been a twenty year financial boom which has benefitted the rich. This has reduced income equality across the world to Roman Empire levels, and the volume and nature of the flow of wealth is beyond control. Many global banks are without liquidity. So are trading companies. Margin calls on these companies will be put off by washing tax dollars through the stock markets, but this trick will only last so long and has maybe run out this weekend. In addition, many derivatives are tied to mortgages where chain of title cannot be proven, and where it will not be proven. This will lead to unconstitutional, law-breaking, knot-tying duplicity on the part of the US Federal Reserve and all the European banks who sold gold in return for lines of exchange swaps over the past few weeks. People will be shafted.

c) This financial problem will be overlaid on a global imbalance between the People's Republic of China and the United States. One is running a surplus it cannot spend because, at official rates, it would flood a market the size of Germany with three trillion dollars. This would set off monumental stagflation at a time when China is past a Lewisian turning point of migration, where productivity growth from urban migration has turned not into wages but into slum growth. If it dumps the dollars abroad, it raises commodity and food prices, stiffs its own, and worsens its export markets. If it throws the money into other markets, it keeps the euro-show going, but ultimately achieves the same effect. It is trapped. The other side, the USA, is a financial basket case and will remain so as long as the laland economics prevailing in Congress and the Council of Economic Advisors continue to grip a people who refuse to wake up.

d) Within this crisis, the pundits will continue to point to Greece and Italy and Spain and Portugal as problems for Euroland. They are not. Germany is. The Euro is a single currency zone. In such a zone, surpluses in one region must be spent to reduce deficits in another. That can be achieved by tax, by government transfer, or by workers moving and sending money home. Germany has no incentive to agree to any, given a thirty to forty per cent advantage over the southern countries and a client group in the east who are cheaper than the south. The South without Germany would work. Italy is not badly run, has been saving for five years, and keeps money in homes which have not been subject to mortgage booms. It alone could sell bags, shoes, cars, watches and suits to ten per cent of the Asian middle classes and retire. It won't, because Europeans won't for some reason go out to work, probably because family breakdown, feminism and small families with many pensioned elders give no one any incentive to do so. Economies are built on the character of the men in them, and Europe has been engaging in a vast experiment to wreck honourable manhood for forty years. A eurozone without Germany would force them to step up; a eurozone with Germany will just be a GroƟdeutschland.

e) You cannot renogotiate the terms of EU membership, and Treaty changes will never be smooth or one-sided. Only Parliament and the British people can pass a law demanding that the courts simply throw out EU law and follow Parliament. If we did, we would be subject still to the WTO, as the EU is, and still to the British groups--the politicians, the local councillors, and the trading standards people--who act like little Hitlers behind the European shield, and we would still follow the European Convention on Human Rights. We'd still have tort lawyers, employment acts and HMRC to keep the Daily Mail in business. Futile gestures are great but they're futile in so far as no one thinks ahead. You may as well have London and then England secede from the UK, leaving it in the EU, which I suspect is what a good many English people (and I consider myself an alien in that regard) want.

f) Celebrity culture, educational theory, science 'writers' holding forth on theology, most of the modern left and right, the bulk of social science, and many economists are basically eruptions of the Satanic principle and nothing much to do with either a decent life or an escape from the eternal recurrence of our crisis.

There, that's what you need to know. On the other hand, the President of Ireland does look like Yoda, and he did beat a man who looked like Mussolini.

Now, I'm back off to my book--I'm almost onto Schrodinger. Or is his equation not there when I'm not looking?....


Rita said…
I was nodding sagely till you mentioned "stagflation"!

Quantum physics holds no mystery like the mind boggling, bogglyness of "stagflation".

Laurence Krauss is a good writer, his Fear of Physics is a classic.
Martin Meenagh said…
You're quite right. the simultaneous appearance of unemployment, stagnation and inflation are bizarre, but in a sense they are diseases of money. Since money is everywhere representative and therefore faith-based--either on faith in it, or in the labour or commodity it represents--problems with it are the product of the human head. The inside of a human head, and the effect of a group on a human head, are bizarre things.

I do like Laurence Krauss, and liked his physics of star trek books. I can't recall if he had a hand in the 'science of superheroes' volume, but it's a great christmas stockingfiller to get pleasantly drunk with too.

Many thanks for your comment.