‘Reset’ is a word that is thrown around by dominant interests to express their desire to retard or even stop the accelerating collapse of the modern world system. The project is intended to begin with its main pillar-the global economy. At this juncture in history, we don’t think ‘reset’ is the appropriate word, as it connotes going back to previous arrangements after clearing/cleaning some operational glitches here and there. In reality, the major problems of the world order are essentially structural in nature. Without dealing with these protracted problems honestly and bravely, the current status quo cannot be maintained. In fact, the potential global disruptions can easily trigger widespread civilizational collapse. On this point at least, we agree with the Davos cabal! See the article next column.
Initial perusal suggests the proposed ‘reset’ project is going to have two major shortcomings. It seems the ‘reset’ undertaking would still like to continue the perennial and deeply flawed regime of unequal exchanges. Since the 18th century, the degree of polarization between the core countries and the periphery has become intractable. Two hundred years ago, the ratio of a typical African’s income, compared to that of a typical European’s was only one to three. Today the average ratio is more like thirty-to-one! This sits at the heart of global structural inequality. Unless this exchange regime that is forcefully and systemically imposed on the peripheries is not discarded, the ‘reset’ plan will not go very far in addressing global inequality. The second thorny issue is associated with the various secular trends of the world system. These are not cyclical in nature. Moreover, they are, by and large, irreversible. They include, amongst others things; climate change, ecosystem destruction, resource shortages, the increasing demand of modern labor/citizens (free education, health, housing, clean water, etc.,) compared to earlier phases of capitalism. It is obvious these cannot be ‘reset’, so to speak. For example, the ‘New Green Development’ is a mere ploy to extend the tenure of the current dehumanizing and wasteful order. It is the likes of ‘de-growth’, ‘de-centralization’, de-consumerism, devolution, etc., that should be the vocabularies of the future world system!
Current sectorial situations can better illuminate the depth of the problem the world is facing. In the OECD countries for example, the retail business sector has been declining for decades. Instead of facing the problem honestly, the managers of the world system started to pump money (to consumers) via credit/debts to encourage increased and wasteful consumption. They reckoned this was necessary to sustain global production enterprises. When this failed, the states themselves became consumers of many unnecessary products. For instance, the military-industrial complex cannot survive without the largesse of the states. In late modernity, financialization took the imagination of the elites and replaced real economic activities with financial engineering in a universe of unearned ephemeral phony money. Valuations of companies stopped being correlated with potential income and franchise value. All the useless statistics/indexes became important because of distorted paradigm emanating from financialization!
The travel industry, which is by far the largest sector in the global economy, had to be subdued or even frozen to avoid catastrophic collapse. Almost all airlines in the world operate in red, propaganda aside. This is because of competition and the resultant revenues decline. When total available rooms runs in the tens of thousands while tourist arrival is hardly a thousand per day, (in a particular city/location), this clearly shows the lunacy of late capitalist modernity! On top of this, we now have ‘Airbnb’ (the hosting business), muscling in the hospitality sector. All these were made possible because of easy finance/phony money not grounded on something real. For example, Kenyan tourist arrival has been declining (due to many factors) for years and is now only in the few hundreds of thousands per annum. Yet, the luxury/tourist hotels that are sprinkled all over the country were intended to accommodate few millions of guests per annum. This phenomenon is now given a name, ‘overtourism’!
Housing is another of the global problems that must be tackled squarely. In China alone, there are close to 90 million dwelling units without occupants. Yet, these properties are expected to go up in values, even though they have been empty for decades and decaying. This problem is widespread and is not unique to the Chinese economy. What is frightening about the case of China is; the sector is a USD 52 trillions affair! It is such gross distortions (creating inequality) that are seriously threatening the world order. A rethink not only a reset is in order. The auto industry is another sector where it is absolutely jammed in overproduction. Capacity over and beyond demand is close to one hundred million units per year! The story is more or less the same in the other economic sectors of the world economy. The imbalance that prevails in the financial sector is probably the worst of them all. If one of the so-called ‘system critical banks’ fell, (like the Deutsche Bank, which has been a prime candidate for a long time) the world will be in a real fix!
Only 20% of the global labor power is needed to produce the current global output. Therefore, in a capitalist world economy where 80% of the sheeple (human mass) is considered redundant, how is income to be distributed? With what are we going to replace the stupid idea of unlimited growth that is embedded in current capitalism? How can the world build a more resilient existence, within the healthy confines of the natural ecosystem? We believe a new paradigm away from the old, is urgently required. The Davos jamboree is expected to address these global problematic, come January. Of course, they would like to deal with these massive/deep problems in their own ways. This time around, we believe, dominant interests must concede to the basic demands of the large majority of the global sheeple, which comprises over 90% of the planet’s human population, per force! Otherwise, the future is going to be hard going, mostly for the parasitic elites. The B***S*** must stop. “Liberty is meaningless if it is only the liberty to agree with those in power.” Ludwig von Mises. Good Day!