David Harvey: The Crises of Capitalism (Animated)

Check this artistic and interesting approach on the banking crisis and the failed economic system we are slave of. He illustrates how all those failed policies caused the chaos we are in.
And if like me you love animations and comics, this is for you!



We really need to get rid of bankers and the feds!

I'm already doubting what this guy says, as he suggests that we are following Hayek and that some say we should "get back to Keynes", when in fact it is the opposite and we are following Keynesian economics and we should get back to Hayek. Maybe he simply msipoke but it sure didn't sound like it.

Everyone knows that we have a Keynesian system. Ever since the great depression, we have followed Keynes theory as our economic model. Furthermore, Mises & Hayek is a system we are not following though many believe, myself included, that an Austrian School economy would greatly benefit this country.

--airspoon





[edit on 24-8-2010 by airspoon]

thanks, I'll watch later, and Harvey was on Hardtalk a couple of days ago:







[edit on 24-8-2010 by john124]

reply to post by airspoon


I don't think we need to worry about the results of overthrowing this pathetic banking regime system yet, but just decide on the process at the moment, and that will lead to an eventual conclusion.

We can't go on as things are because of the reasons Professor Harvey gives in his BBC hardtalk interview.


[edit on 24-8-2010 by john124]

I love these animated infotaining videos..

One thing for sure is that the crisis was bad for Americans, but good for many investors. Hell, bubbles are fantastic money making machines. I wouldn't be at all surprised if we had more of them. Probably many more.. After all, the goal of the market is to make money; if bubbles are good at making you money, then the market will seek to create as many bubbles as possible. The bigger the better.


Food is coming next, according to some people. A food bubble, that is.

reply to post by Kaytagg


I would like them too, if the information was accurate. He either mispoke or he 8is flat our wrong and in either case, the information given is wrong. I highly doubt that he doesn't know what he talking about so either he is propagating disinformation, planting a poisoned seed if you will, or he simply made a huge mistake, that nobody in production managed catch.

--airspoon



reply to post by john124


I'm not saying that we need to overthrow the system and in fact, it will overthrow itself. However, if we don't pick our battleground, the replacement model won't be up to us. With that being said, picking our battleground isn't really a luxury that we have, though we certainly need it.

--airspoon

reply to post by airspoon


Which information isn't accurate?

reply to post by Kaytagg


Check my first post. In the beginning og the animation, he suggests that we are in a Hayek system and that some say we need to get back to a Keynes model, when in fact we are following Keynes' model and need to get back to Hayek. He then basis the premise of his information on this innaccuracy. Check my first post for a better explantion (with links).

--airspoon

reply to post by airspoon


Under his "genres" list, he says that "everybody was obsessed with a false theory. They read too much Hayek and believed in the efficiency of markets. And it's time we got back to something like keynes, or we took seriously hyman minsky's theory about the inherent instability of financial activities."


So what is your beef, exactly?

Originally posted by airspoon
I'm already doubting what this guy says, as he suggests that we are following Hayek and that some say we should "get back to Keynes", when in fact it is the opposite and we are following Keynesian economics and we should get back to Hayek. Maybe he simply msipoke but it sure didn't sound like it.

He didn't misspeak and he isn't wrong.

He just has a different opinion (understanding) of how our economy works.

reply to post by airspoon


You are wrong too my friend, we are in neither Hayek or Keynes models

“Is all spending equally productive, or should government policies aim to simulate private investment? If the latter, then Mr. Obama is following in FDR’s footsteps and impeding recovery. He does so by demonizing business and creating regime uncertainty through new regulations and costly programs. In this he follows neither Hayek nor Keynes, since creating a lack of confidence is considered destructive by both.”

online.wsj.com...

and honestly I don't think it is very relevant to the points M. Harvey is trying to make. Capitalism as we know it is deeply flawed

[edit on 24-8-2010 by TheOracle]

Originally posted by airspoon
reply to post by Kaytagg

 

Check my first post. In the beginning og the animation, he suggests that we are in a Hayek system and that some say we need to get back to a Keynes model, when in fact we are following Keynes' model and need to get back to Hayek.

I just realized he doesn't even say that.

He says "some people would suggest"

The mechanics of our economy isn't really a matter of opinion, though what you believe would be better, is. I'm not saying that his opinion is wrong, though his description of our current model is or the suggestion of that description anyway. Either you are following a particular model or you aren't (with variations of course).

Our economy is following Keynes' model, not down to the book, but certainly more so than Hayek. I have been a long time fan of both Hayek and Mises for a long time. I believe in a free and decentralized market, in root with my libertarian political views on conservative fiscal policy. What we have now is hardly a free market, nor is it decentralized, in spite of the fact that politicians like to use the buzz-word of "free markets". We do not have a free market because the government issues favor with certain companies, thus preventing the market to decide its own direction. So, while the politicians like to claim we have a free market, we really don't. Many people claim that the free market lead to deregulation of the financial sector and on the face of it, this is true but it was not due to free market capitalism, rather is was due to Keynesian economics because the government deregulated only what and who it favored.

As far as Keynes, we are trying to spend ourselves out of each rut we get stuck in. Our solution is to pump to more money into the system. The publ9ic (the government) is actively deciding setting policy that influences the market.

In Austrian economics, which Hayek and Mises championed, it is the market that regulates itself and we haven't had that for a very long time, if ever at all. In order for this system to work, you can't half-donkey it. You either have to be all in or not try it in the first place. What happens if you'r not all in, is that government will show favor with entities and thus allow them to creep in and take over what other parts of the system that would otherwise be self regulated.

To suggest that we are in a Hayek economy is absurd, especially seeing how my son has to get permission from government to sell lemonade at a stand on the side of the road.

It is more clear than ever, that we are in a Keynesian system and we have been, since each of our births. You may not see it because a lot of it is due to corruption, but it is there and I doubt you will find an honest economist who would suggest otherwise.

--airspoon

[edit on 24-8-2010 by airspoon]

In a nut-shell this animation is a very powerful expression of what has been going on. I think "wage suppression" as described at the expense of debt accumulation is key in this animation argument. We cannot continue down the path we are on. It serves a group of people fine, but for the majority makes life very difficult.

Originally posted by airspoon
The mechanics of our economy isn't really up for opinion

That is exactly why I wrote "understanding" in parentheses.

Originally posted by airspoon
Either you are following a particular model or you aren't (with variations of course).

That is an over simplification of something extremely complex.

We follow little pieces of every model.

Originally posted by airspoon
Our economy is following Keynes' model, not to the down to the book, but certainly more so than Hayek.

Many economists would disagree with this, particularly when discussing international or global economics.

Originally posted by airspoon
To suggest that we are in a Hayek economy is absurd, especially seeing how my son has to get permission from government to sell lemonade at a stand on the side of the road.

You need to think bigger.

The free market is in the big picture.

[edit on 24-8-2010 by Jezus]

reply to post by airspoon


The market can't self regulate. Haven't you been paying attention to anything that happened in the last 3 years?


You need certain regulations and rules, regardless, like a ban on cartels/monopolies, for example. You should also have rules which preserve public health. You should also have rules to protect equity and capital. Etc..


As far as certain businesses gaining influence with the government -- that's a failure of democracy, imo. We elect these officials. If they make back-room deals with big businesses, and start funneling tax payer money into the coffers of their friends, then kick them the # out of office and vote in somebody who'll prosecute the crime AND not let it happen again.

Oh yea, we can't focus on stuff like that, because gay marriage is a much more pressing matter. America - Land of the retarded.

reply to post by Kaytagg


****Please read the whole thing, as not too many people did with the other post******

No, your not understanding me. In our lifetimes, we have never had a whole self-regulated market, which is what would be needed in order for it to work. You can't deregulate some, while regulating others because that isn't deregulating the market, rather it is only showing favor by the regulators (the government). With self regulation, it is the consumer who ultimately regulates the market and it is all or nothing. There is no such thing as a partly self regulated market because that un regulated part would only be favor by those who regulate, thus making it part of the bigger regulation.

Again, we haven't had a whole self regulated market and because people see that deregulating the banks didn't work, it wasn't the self regulated market that could work. All that was, was the government showing favor to the banks, as opposed to allowing the consumer to decide.

It is either an all or nothing thing because if it is only done half-donkey, it isn't done at all.

If you remove government from the equation and follow the laws of supply and demand, the consumer will enforce regulation on the market. Instead, we hand that regulation over to the government and trust them to do it in a fair manner, which they obviously don't. Instead, they show favor such as deregulating some, swaying the market for others and preventing competition from the rest. It then turns into who can bribe the regulators the most. In a free market, regulated by the people, the only way you can bribe the consumer is to lower prices and/or come out with superior products, which is a win-win for us because that is the goal anyway.

If a product is needed, the people will buy it, if it is not needed, people won't. If it is too expensive, someone else can be successful by making a cheaper product. The consumer is going to buy the best value and thus the best value would win, absent any government interference.

In this scenario, we have the government preventing the best product or value from entering the market, thus allowing prices to surge and companies to do what they want, not in the best interest of the consumer.

Lets use dishwasher soap as a small example. If I wanted to seel dish soap, I could lobby the government to prevent any other dish soap company to get to my status and the government can do this through regulation. I then could sell you dish soap that is the cheapest to make for the highest amount of money that you could afford. If dish soap was absolutely needed or mandatory, you would be in trouble. If government did not interject itself, another person could come up with a better formula and better production methos to offer it cheaper. Neither my company or his would have to spend money on meeting government regulations or lobbying government for the right to exist so our product would be even cheaper.

If saefty is an issue, then people would simply not buy a product that was unsafe, thus allowing someone else to come to market with a better product that is safe. So on and so on.



--airspoon

[edit on 24-8-2010 by airspoon]

reply to post by airspoon


I have been reading your posts.. the first post I thought "he misHEARD the video," so I painstakingly rewound and wrote down what he said, then posted it for you to read.. so i'm not just talking out of my ass, here..


As far as a totally unregulated market goes -- you can't have that -- ever. It's not possible. You can't even define what a market is without having rule of law. Laws being applied to a market, by definition, have already set limitations on that market.

For example, there are pollution laws.. if I own a factory that produces cyanide, I'm only allowed to leak a certain amount of that cyanide into the ecosystem, or else I'll have to pay fines, or possibly answer to criminal charges, if I leak too much.

So what I understand from you is that my cyanide plant shouldn't have any regulations, and if I find it cheaper to skimp on safety measures, and I start leaking toxic derivatives into the water table and people start getting sick, that's okay?

If it's not okay, then you have to have some kind of regulatory body to determine how much i'm allowed to leak -- which is what we have today.

So if you got rid of that regulatory body, what would you solution be for my mom&pop cyanide factory? Am i allowed to pollute and make people sick, or not.?

reply to post by airspoon


Sorry airspoon but after several great posts, you've let yourself down with this one. While reading it, so many real-life examples came to mind that completely disprove your assertions but time won't allow me to go into all of them.

Originally posted by airspoon
With self regulation, it is the consumer who ultimately regulates the market and it is all or nothing.

In the late 80s/ early 90s, the UK privatised the bus industry. They didn't sell it to any specific provider. They just allowed anyone to set up a bus company and compete for business. The only requirement was that they had to maintain all of the required routes. The most aggressive and well-financed company saturated their markets with buses and drove the smaller players out of business.

The customers didn't know any better and just used whichever buses arrived as the routes were the same.

The bus company! then started complaining to the government about the routes that weren't making a profit and eventually got them dropped. In the end, the councils had to pay extra to keep buses running on the unprofitable routes i.e. the taxpayers had to subsidise them.

Again, we haven't had a whole self regulated market and because people see that deregulating the banks didn't work, it wasn't the self regulated market that could work. All that was, was the government showing favor to the banks, as opposed to allowing the consumer to decide.

Perhaps you're not aware that despite all of the deregulation of banks and stock markets, the ultimate customers i.e. us paying into life insurance policies, pension funds, unit trusts, etc were not really aware of how unregulated the markets were. I realised decades ago that managed funds were a licence for churning (generating income for the managers by buying and selling shares without a true market reason.) Hence, I stayed out of these schemes and used relatively safe investments instead. However, my company pension fund is directly invested in the stock markets and as such subject to any scams being pulled.

We now know that the whole market is just a giant ponzi scheme manipulated by the big players to extract money from the unaware.
References:
The Wall Street Ponzi Scheme called Fractional Reserve Banking

Max Keiser: oil price manipulation on wall street

If a product is needed, the people will buy it, if it is not needed, people won't. If it is too expensive, someone else can be successful by making a cheaper product. The consumer is going to buy the best value and thus the best value would win, absent any government interference.

This is wrong on several levels. Need is relative such as when your child tells you that they need the latest gee-whiz toy or you yourself need that huge, HD TV. People in many countries actually do need clean water and food but they cannot afford it and so die from starvation and disease.

If your statement was really true then grocery stores would only sell organic produce! Processed food containing MSG, GMO, trans-fats, aspartame, aluminum, etc would rot on the shelves ( - just kidding because that stuff will never rot!) The government interference here is that the FDA (and equivalents in other countries) make us think that they're protecting us when they're actually protecting the manufacturers shady practices from us.

If I wanted to sell dish soap, I could lobby the government to prevent any other dish soap company to get to my status and the government can do this through regulation.

In an unregulated economy, you'd use all the tricks available to you such as aggressive advertising, false claims (e.g. quality, effectiveness, safety...,) and underpricing (to name a few,) to knock your competitors out of the picture and then squeeze your new market for what you can get until the next big player moves in.

Despite the US governments lack of efficiency, we got crash bags as mandatory equipment in cars several decades after Congress first voted it into law. Without Congress, the bags would probably still be an expensive extra.

Don't forget all the insurance companies that sell you a policy, happily collect the premiums for years and then refuse to pay out as soon as you try to claim. I personally know several people who finally had to settle for a pittance on a disabling injury because the insurers starved them into submission.

Example:
Aviva refuses blast victim’s claim because he didn’t pay premium from hospital bed

If safety is an issue, then people would simply not buy a product that was unsafe, thus allowing someone else to come to market with a better product that is safe. So on and so on.

Witness the exploding battery fiasco of the Apple iPods where Apple forced owners to sign a gagging order as part of any compensation package.
They say "any news is good news" but apparently Apple would prefer that people not pass on any bad news about them.

My point is that any argument about a perfect unregulated free market is a utopian ideal and completely overlooks the whole reason why we have regulated markets. It also overlooks why even regulated markets don't work. The reason is the same for both - greedy people who believe that the only way to ensure their survival in the market is to dominate it ruthlessly.

Some years ago, I was a fully committed conservative but experience and research has shown me the error of my prior beliefs. You will probably find that you're on the same journey. I wish you well in your travels.

Its not Capitalism but Illuminatism that is running down
world economy with the oil trade and rejection of any alternative
solution that actually works.

The water power alone might power the world's energy needs, which
are but momentum needs, and reduce the hold of oil.