Archive for the 'commons' Category

uncoupling at the party

Sunday, November 9th, 2008

I went partying last night in the dome, inside the castle mountain in Graz, where tunnels and bunkers have been carved out by the Nazis during the second Word War and now are used as dance floors and conference spaces. This is music that — given the sheer volume and the drum&base pumping — passes through you, or at least, it does so if “you let it”, as someone told me (ehm, shouted at me) on the dance floor. Now here is a thought. In the morning I had a workshop on my book as part of the Elevate festival, and among other things we discussed the idea that the capital relation, or the value struggle, passes through us. Mmhh, so, what happens when in the evening the music passes through you? It happens that it is banging the capitalist relation out of ourselves, at least momentarily, leading to the momentary uncoupling from the temporal dimension of capital, the one that requires schedules, deadlines, responsibilities that have no or little meaning as well as endless struggle against it. If you add the fact that in music, rhythm constitutes the commons (see this blog entry), then this is it! The dance/rave culture that lives its nights and morning floating from one dance-floor to another, is the contemporary manifestation of what in the 1970s was called “il bisogno di comunismo” (the need for Communism) . . or “commOnism” . . .

meltdown management

Wednesday, October 1st, 2008

there is a a lot going on definitively in the current financial crisis, and events are moving very fast. Hence, let me try to put some order to some untidy thoughts with the disclaimer that I am commenting on a fluid situation and hence I am not 100% committed to what I am saying

* neoliberlism as we know it, is obviously finished. But this was true also before the recent g8 in Japan. The current crisis/meltdown of finance raises the *urgency* of dealing with the impasse they have been facing for some time now. This moment of crisis we are living is where the different positions and strategic horizons are forced to distinguish themselves and/or find a common ground. This is a challenge for both the ruling classes and for the “commmoners”.

* For capital’s *in general* perspective (that is the perspective of the “system that any government must try to the save whatever means necessary” to paraphrase today’s interview to Tory leader Cameroon who had a sudden taste for bipartisanship in the midst of the Tory conference) the impasse must be solved in a way or in another. Whatever way, it must provide the material conditions to launch a new phase of accumulation. This is obvious, even if it may sound a platitude. But it is a platitude that does constitute the strategic horizons within which the current debates are plaid out.

* what way is of course important. We have at play two broad strategies within this horizon. One, which brings together the panicking US administration (Bush and Paulson) with “responsible” democrats who, pace some populism in their interventions that have realised some fine tuning to the robbery of the $700b, thought to go along with the bailout of Wall Street. I agree with Naomi Klein here. The shock is here delayed. The cost of this bailout (on top of skyrocketing military expenditures), would in the near future tie the hands of any US administration and be the basis of more typical neoliberal policies (cut in spending, re-privatisation of nationalised banks during the crisis, etc.) The infrastructure and energy investment promised by Obama will take place if he is elected, but in a context of populist austerity (in which the cuts necessary to fund these investment are distributed “fairly”). If instead McCain goes to the White House, austerity is already embedded in his agenda even without the $700b constraint. In either case, this bailout scenario is relying on the idea that the system could go on more or less as it did so far, a part for some buffering during this crisis. The difference between an Obama and a McCain administration here would be the difference of degree of governance: obama would manage the flow of domestic and international conflict in a more deal prone way and McCain would replay Bush’s script despite his annoying conciliatory tone he uses to dress the substance of his speech. Obviously, financial capital seem to want the bailout, as it save their skins and, potentially, at least part of their bonuses.

* if the rescue plan goes ahead (there is a vote on Wednesday, we will find in a situation in which public money has been used at a massive scale to buy assets above the value they would have had if the market were left to operate as in textbooks. This is not only something that enrages many people, it is also something that opens to a degree the socialisation of finance used, in this case, in order to save the system itself. Here the US “Middle Classes” are really caught in between a rock and a hard place. Bail them out, and swallow the anger that your money goes to save their neck and more sacrifices will be demanded from you tomorrow to pay for the bailout. Don’t bail them out, and face the prospect that your pensions, your access to credit, your job, your children college, your cars, your way of life is ultimately threaten by financial meltdown (see the amazing Bush’s speech) the other day). In this sense, the Middle Class as Middle Class will not get us out of this mess. The Middle Class must accept its end in order to aspire for a truly new beginning.

* now, the failure to pass the $700b plan (so far, don’t forget they are still trying to patch this up) is really interesting. There is obviously a lot of opposition to this bail out, bringing together hard core republicans and radical left types from the street. From a left-populist perspective, the argument has been made that instead of paying “greedy” Wall Street, money should be put towards funding home owners and the recovering of main street. Some versions of latter-day Keynesianism here are always at play. Saskia Sassen for example has made an argument along these lines in “open democracy”. (see also other examples cited in my blog post few days ago) Some of the arguments will be taken on board by McCain and, especially, Obama even if the $700b passes. But the real interesting perspective here is that this crisis is opening up an opportunity for true “market fundamentalists” to step in (even while they are riding as in the late 1970s a populist rhetoric): don’t bail out the suckers of Wall Street, let them face the risk they have incurred. This is the “moral hazard” argument, with which committed marketeers hammer in their sense of value and justice any time they are in front of a crisis. Crises, even big one, have a disciplinary role to play, to brig about needed restructuring. Let them play it. And since they are the true believer in the end of history (that is, really, that market capitalism is the bliss point of human evolution), they are confident that even a crisis of this proportion can be the basis of a new round of accumulation. Obviously, to the limit this stance could threaten the system itself, *if* the “commoners” had gone through a process of powerful enough political recomposition not only in the US, but across borders. Lacking this, lacking this “explosion of the middle class” and its recomposition into commoners and commoning predicated on new values, this stance offers also a great opportunity for truly massive and major restructuring of the economy and livelihoods at a planetary level in capital’s favour. This stance could even open to a period of the US state taking over of Wall Street devalued financial firms at a bargain, hence the creation of a US Sovereign Wealth Fund that would recapitalise in value in proportion to the global restructuring it is able to implement, and of the expectation of world growth it is able to elicit that would be reflected in the value of those nationalised financial firms. This of course could be in “partnership” with other sovereign wealth funds around the globe, a sort of “productivity deal” at governance level. Here we would have a situation in which the Middle Class would be tied to the neck to accumulation prospects (and its enclosures), around the planet not longer simply because of their pensions, but also for anything the state would provide for their reproduction. We can even imagine a situation in which in few years a Milton Fridman’s type of basic income is introduced together with a tax flat rate, grossly reducing tax revenue, but replaced by the revenue of the US people Sovereign Wealth Fund, capitalising itself in direct proportion to prospects of world accumulation (you can imagine the role of the US military then!!).

The main difference between this strategic course of action and the bailout will be in the intensity of the restructuring needed and its time frame. In either case, and whatever the scenarios ahead, it is certain that after the period of financialisation of society we are entering now the period of socialisation of finance. This has been recognised widely, even by mainstream press. The end of neoliberalism as we know it however, is not the end of capitalist enclosures, disciplinary and governance processes. It is the strategic reconfiguration of the social force we call capital on a new plane.

The question for us is how do we intervene in this new context. The question we should raise and problematise is “what socialised finance” — that is, in our terms, when we strip from money and finance its capitalist form and recognise its “rational kernel” as a conduit for the distribution and allocation of social powers — what decisions of social investments, for what priority, for what needs, through what mechanism of commoning, the fucked up commoning of capitalist enclosures and discipline, or others ones, which one?

around $700 billion

Thursday, September 25th, 2008

Paulson’s argument for keeping his $700b bailout programme a free gift to his old Wall Street mates is that it is designed to attract private partners who would be discouraged if too many caveats are put into place: see here

here is Paulson’s testimony

check also Naomi Klein’s interview on democracy now . . . .when it was run by Paulson, Goldman & Sacks increased debt exposure enormously, hence today’s bail out goes to safe his old colleagues ‘ass

check this: presidential debate suspended, general states called, bipartisan consensus seeked to frame $700b plan . . .we might be in the midst of a process to generate a new kind of consensus which will set the framework for policies for the next few decades.

also, from Naomi’s bulletin the news that Gingrich is holding an event this Saturday, September 27 that will be broadcast on satellite television to shore up public support for new controversial policies. . . .

here is the breakdown of different take and resistance around Paulson from RGE monitor site:

◦ In its original version, Treasury requests the right to buy anything from any institution (incl. hedge funds) at theoretically any price it deems right without oversight or legal recourse. Management of assets will be outsourced to the private sector. Authority expires Sep 2010. By order of magnitude, the entire shadow banking system incl. brokers and hedge funds is $10 trillion of which $5 trillion are buried in off-balance sheet vehicles.–> House Republicans warn Treasury Secretary Henry Paulson on Sep 24 that his $700 billion financial rescue plan wouldn’t pass and ask for more time to consider alternative ideas.
◦ Ben Bernanke proposes ‘hold-to-maturity’ purchase price instead of current market value described as ‘fire-sale’ price.
◦ Krugman: if taxpayers are to overpay for securities that other private market participants would not take at any price then an equity stake is a MUST; i.e. should be make-or-break issue in Congress.
◦ Democrats’ alternative plan includes measures on: restrictions on executive compensation, Equity stakes in return for bailout to recapitalize institutions and retain upside for taxpayers; Bankruptcy reform to lower debt value of purchased mortgages; Independent oversight of how $700bn are spent; Second stimulus package for Main Street next to bailout for Wall Street.
◦ Industry groups want to temporarily suspend mark-to-market accounting in order no to take a writedown on sold assets
◦ Tett: valuation and pricing issues prevented the first Super-SIV from working, the same might happen again. If bad asset purchase price is too low, writedowns might be too large to bear; if price is too high, taxpayer overpays and has limited upside eventually–> 
◦ Geithner (via MarketWatch): The ’shadow banking system’ that needs to be re-intermediated is a $10 trillion market without adequate capital provisions (=$2.2tr commercial paper conduits incl ABCP + $2.5tr repo/reverse repo market + $4tr combined brokerage assets + $1.8tr hedge funds = $10.5tr in 2007) that boomed outside traditional banking. In comparison: the traditional banking system is also $10trillion.
◦ In July, FASB has decided to “eliminate the concept of the Qualified Special Purpose Entity (QSPE)” in the revised financial-accounting standard, FAS 140, starting November 2009. This requires banks to consolidate off-balance sheet vehicles used to package assets into securities –> Up to $5 trillion of dollars worth of illiquid assets/derivatives are buried on banks’ Variable Interest Entities (VIEs) 
◦ BIS Joint Forum: CDO of ABS (i.e. structured finance CDOs), CDO^2 are not likely to survive the turmoil .  
◦ SIFMA: Global issuance of CDOs from 2004 - 4Q2007 totaled $1.47 trillion. CDO issuance by underlying collateral in 2007:
-$254.8bn structured finance CDOs (collateral pool consisting of RMBS, CMBS, CMOs, ABS, CDOs, CDS, and other securitized/structured products) 
-$148.3bn high-yield loans (rated below BBB-/Baaa3) CDOs
-$78bn investment-grade bonds CDOs

Naomi was rebuked by Andrew Sullivan remarks that the problem is not shock, but there is not enough “capitalism”, where people take responsibility, taxes are on a level playing field etc. . . .it is actually quite interesting here the fact that this is the major impasse between the two, on other themes much agreements it seems.

Here 5 economists interviewd by Al Jazzeera, incluing James Galbraith . . .ranging here from keynesian growth policy to calls against moral hazard

The article above was asking: is this the end of capitalism? A specular question was asked during BBC Newsnight by Jeremy Paxman to Naomi Kleim: what is the alternative to capitalism? There is always an impasse to this question, precisely because the question requires an “ism” for an answer, and we are quite sceptical about providing these (and this is good, it means we are sensible to the fact that the “ism” comes out of our own interaction, and is not a magic formula you and I can campaign on. So, we should say: I do not know what is the alternative to capitalism, but I know what is the alternative to capital, and that is that people start to run their own affairs in common, giving values to other things than profit. For example, the alternative is that instead of giving $700 billion as a blank check to the financial capital of wall street, we let them bankrupt, buy their assets at a bargain, and start use finance as a conduit for socially and environmentally sustainable investment, predicated on social justice. Who decide what is just? well, since these financial powerhouse will be in public hand, we have to open a debate what do we mean by democracy . . .

Here is the Austrian economist position. Here the author claims the bailout will be $5 trillion. The argument is that “More formally, there is a gap between the nominal and real value of debt instruments that across the entire credit spectrum easily exceeds $5 trillion, the risk of which the federal government has assumed.” Through the bailout the federal government is providing a floor to the assets prices above the “real value” of assets (i.e. very low in these conditions). To paraphrase Marx, as soon as wall street and government put their heads together, the sacred laws of supply and demand are repealed.

Three options are given here by the Austrian economist author Don A Rich:

“First, the federal government raises taxes to pay off the difference. That clearly isn’t good news for Wall Street or the wealth-creation process.

Second, the Federal Reserve System prints enough money to prop up debt-security prices at nominal values over time, thereby bringing about equilibrium by raising the prices of everything else. A borderline hyperinflation isn’t good news for Wall Street.
Third, perhaps in some instances the federal government seizes the assets of the financial industry at fire-sale prices, and therefore inflicts the loss on shareholders and private creditors in a bizarre form of monetary-policy-induced, catastrophe-driven socialism or fascism.”

Well perhaps not, perhaps the seizure of financial assets could in principle open to a different and far more democratic use and function of finance as mentioned above.

Here Saskia Sassen’s “New new Deal”: let us spend $700 billion but in different ways (infrastructure, social services etc.). No mention about the link between fed expenditure and gov control on wall street.

Value struggle on the river front

Thursday, June 19th, 2008

video_button_white_dred.gifHere is a Al Jazeera report on the impacts of the Belo Monte Dam in Altamira, Brazil and on the Xingu Encounter 2008. For more on the latter, see the site of International Rivers


Indian farmers against export processing zones

Monday, May 12th, 2008

I do not know what happened since last year, when the news came out of Indian farmers refusing to sell their land in order to develop export processing zones and thus forcing the government to do a U turn. In any case, this is an interesting piece of news here

The capitalist use of a hurricane and the struggles against enclosure of public housing

Sunday, January 20th, 2008

video_button_white_dred.gifThis short film surveys the tactics used by the city administration of New Orleans, to try to get “affordable” housing tenants out of their houses, so as to “regenerate” them for money making. It also shows some of the struggles of the tenants to stay in. They have other types of “regeneration” in mind. A clear case of value struggles.

Magna Carta and the commons

Thursday, June 21st, 2007

magnacarta.jpgHere is Peter Linabough keynote at the crisis of the californian conference held in Berkeley on 27 and 29 April 2007. For more audio material see here. Peter Linabough has just finished a book on that treaty of the class war that was the Magna Carta. For a short article on the matter, see here. This laid back and passionate talk tell us how the recent anti-terrorist laws are cutting bak on that original deal and help us to see the struggles for commons through the letters of the law.

Recuperating the Political

Tuesday, June 19th, 2007

I post below a recent intervention by Gustavo Esteva appeared in La Jornada, Thursday 4 June 2007. (translated by C. Herold). Commenting on the recent movement in Oaxaca it poses the question of another “politics” based on dignity and presence rather than political “lines” and representation.

“Choose your enemy carefully,” warns an old Arab proverb, “because you will become like your enemy.” If your enemy is an army, you will need to create another to confront it; if your enemy is the mafia, you will become a mafia.

“We cannot involve the army of the United States in the fight against illegal drug trafficking,” said the U.S. anti-drug czar some years ago, “it would create a national security problem.” He was recognizing the risk involved, the risk of the dissolution of the armed forces if they are used for that purpose. His statement was entirely cynical–he had just returned from a tour of Latin America where he pressured every government he met to do exactly that. He didn’t care that those armies would dissolve. The army of the U.S. would remain standing, in case an army was called for. (more…)

Happy May Day

Tuesday, May 1st, 2007

08maypole.jpg

The “worker’s may pole” (1864) captures the hybrid green and red tradition of May Day, so well described in this classic account by Peter Linebough.

While the world is burning, I play the fiddle

Monday, April 30th, 2007

orchestra.jpgAn old friend of mine called on a saturday morning, looking for me. But he was told that I was at my regular violin lessons that I started taking few months ago. So he said: “ah ah, so while the world is burning Massimo plays the fiddle!” Indeed, I am, and while I do that I live in another world, and think about its dissonance or parallels with our daily lives.

I have joined the East London Late Starters Orchestra last October, few months after I bought myself a cheap violin.The orchestra is an amazing community. It was set up about 25 years ago, a student run training orchestra for those who pick up an instrument late in life. Tutors-conductors are kind, enthusiastic and very communicative of their own individual approach to music, conducting and technique. I am learning much more than few tunes on the violin. (more…)