BOOK ONE
I - THE PERVERSE CRISIS
4. THE 13-FIGURE BUM CHEQUE
There are "Losers" who may stab us at dusk, or give us the
great guilt trip and ruin our day; there are average "Winners"
who might lose the spirit and downgrade our whole society to "third
class", but what about the threat from far above, from the Champagne
Crowd in the Pullman car, the threat from those who have POWER ? After all,
great battles to bring down whole systems are usually fought for the "Poor",
for the Have-nots and against injustice, but they are seldom fought by the
victims themselves, or only marginally so. It is not the French peasants
who made the French Revolution, nor the Russian mujiks who revolted successfully
against the Czar but, in these and all other cases, an intelligentsia which
was supposedly part of the ruling class but decided that it did not receive
"enough".
Revolutions are made by small groups of top-dogs - or would-be top-dogs - helped by rabble or soldiery; they are launched by prophets/saviours in good or bad faith, or by opportunists who happen to see a small crack in the power structure, and manage to put a wedge to it, breaking it wide open to their advantage. Their advantage which may - but usually does not - coincide afterward with that of the victims in whose name the rumpus took place. What kind of threat should we expect today from our top-dogs?
Trouble from its Powerful Ones comes to a society when the rules of the
Game of Power that make them powerful are challenged. One of the best ways
to do this is to question the value of the chips. So, as we face the crisis
that comes with the end of the Age of Toil, let's remember that there is
always a "joker" hidden in the pack, an "instant blow-up"
alternative that has everybody pass Go once for all. The "joker"
threat in the present transition is to look at the chips - money - and to
cry "Foul!". This, we will need all of our good sense not to do,
since there is something of a link between work that disappears and money
that loses its value.
The deceptive treasure chest
If we are to survive the present crisis, we must settle with elegance the question of all that useless money lying around. Thought we were short of money? Think twice! I am not talking about the little greenbacks piled up in bank vaults and safety boxes; they're merely small change in the petty cash. I am talking about the real astronomical figures, the incredible wealth of all that money we owe. Do not expect from me, at this point, an up-to-date account of our debts; figures are changing daily, so just take the following as an illustration and rest assured that, by the time you will read these lines, matters will have changed for the worse.
To begin with, you and I, and these Jones we are trying to keep up with owe, merely in mortgages, loans and consumer credit, the modest sum of 2.7 trillion; then corporations, large and small, owe in mortgages, loans and bonds - which, unlike shares, are real debts - another hefty 1.2 trillion. To top it all, the U.S. Government owes, at the date I am writing these lines - (but it will surely be increased any minute, now) - the cute amount of $l,850,000,000,000, the thirteen figures reading as one trillion eight hundred and fifty billion dollars. Astronomical figures indeed, as the total sum of our debts would pay for enough gas, at the current price, to fuel the average car for a very long 45 light-years trip, being roughly 10 times the distance to our neighbor star Alpha Centauri. Quite a debt...!
Poverty? To the contrary, this debt means incredible wealth, because we have to remember that somebody must be on the bright side of the picture: some great Powerful Ones must have all that money coming to them. Lucky aren't they? Actually, it is rather an embarrassment, because the huge amount is merely a right to a share of the spoils, if ever our leaders would decide that you and me should make good and pay back that debt on which rests the power structure of our society. Bad news for the holders in due course, though; we, the debtors, may relax, for our leaders, of course, do not have the slightest intention that this debt should ever be repaid.
To the contrary, we increase it annually at the rate of 10 to 15%, and the Government deficits alone keep the economy in shape adding approximately two hundred billion a year to the total. Some economists foresee that public indebtedness should pass the ten trillion mark sometime in the 90's, which would not be more consequential than making it a 14-figure bum cheque.
We have no intention of paying it back, but what if we would? It would be the dirtiest trick ever played on top-dogs! They do not need the money, obviously, because otherwise they would just push open the door of any bank and cash, draw upon, or borrow on the value of the bonds and promissory notes that they hold. Pay it back, and they would have absolutely nothing to do with the money thrown at their feet. Wealth would appear as another "great, golden, quite vaporous pillar", and vanish in its own subjectivity the minute they would try to put their hands on it. Top-dogs have no other use for the money owed to them than to invest it, and they have no other choice but to invest it the way it is already: it is the only haven left for wealth. The Government, the corporations, you and me, are doing top-dogs a tremendous favour whenever we accept to borrow money, turning into "power chips" what otherwise would simply be a large stack of paper.
It is not that we want to default on payment; the heart of the matter is simply: "pay it back in what?" In an- other age, very rich Romans could go for lampreys, or ask for ice cubes from the Alps, but there is presently no equivalent in our society, nothing with real "pleasure value" that only the real rich could buy and that could make a dent in the hoarded trillions, nothing that could bring half so intense a joy as the mere possession of wealth and of the power that comes with it.
There would be a tremendous market, right now, for an "anything-you-want" type of business that could turn into earthly satisfactions even a very, very small part of this awful lot of money lying around. In the absence of such an outlet for wealth, and until someone can bring back pleasure and fun into the money game, there is nothing much we can do to honor the debt.
We cannot pay back our debts, even if we wanted to, because there are insufficient "funds" in society, in terms of real goods and services that might be of any use to the Powerful Ones, to honor the commitment. Of course, the Government could print the extra money - just like any hobo may write down a cheque for any zillion dollars - but, just as the bank will not pay the cheque of the hobo, there is no way the production system could deliver rapidly to the rich extra goods and services to make good on the 13-figure bum cheque.
Now, let's go deep into fiction. Suppose for a minute that the rich should decide that - since they don't need it after all - they will ask for their money back and use it to buy more food, or build many more houses for the poor, or what not. Would all the goodwill and greenbacks bake one more loaf of bread or one more brick? The reality is that unless you add more work, there would be exactly the same quantity of goods and services in this country after this grand gesture as before, and that all this money floating on the market would have just one result: inflation.
Inflation, until such time as the price increase would have the sum of all available goods and services be "worth" enough to absorb all the extra money made available. The money which has never been anything but a symbol for the sum total of all these goods and services.
Nobody would be richer but a small minority of people, totally destitute, to whom everything would be given free. Just to the contrary, everybody else would lose, and the worst losers would be the less-well-off, since they could not afford the new inflated prices and therefore would end up with less real welfare, while the rich would simply put down more money and go on buying everything they want at any price. If more work is added, then of course new wealth will be created, which may or may not be distributed more equitably; but this does not change the fact that the present surplus trillions cannot create more real wealth or welfare
Let us be very clear about that, because it is the gist of the matter. To really back the cheque in kind would mean WORK to produce trillions in new services or in new goods for which there would be a demand. If we cannot do that - and no money-wizardry will make it happen instantly - the money cannot even be given away, for then we would just get the same and pay more for it. If we do not want the chips to lose all value, we have to borrow the stuff to prove that it exists... And spend it, somehow!
How do we do it? Basically, a part goes to Santa Claus, the Welfare system,
to make sure that consumers' demand remains effective; another part sponsors
the build-up of the largest, mostest, bestest pile of whizz-bangs ever,
just in case we decide to have a nuclear fireworks and see what God would
have done if He had had real money. The so-called "Left" in this
country favors being more generous with Santa Claus, while the so-called
"Right" generally prefers to assign a larger share to military
spending. One way or the other, though, the important thing is that the
money be borrowed by the State and spent. It seems to be a good turn for
the real spoiled brats who really have everything; but, as a matter of fact,
it is a good turn for everybody, for we have seen what would happen if we
would pay the debt back and make all that wealth "liquid".
The Work Standard and the "alternative"
If it cannot be honored, what does the huge public debt really mean? If we compensate debits and credits and take away all the intermediaries to simplify the equation, it becomes a note, a promissory note to pay the huge amount, signed collectively by those who do not hold Government Bonds in favor of those who do. More simply still, consider it is a debt of the Have-nots in favor of the Haves.
How can the Have-nots pay back? There was a time when the "Gold Standard" applied, and then all debts ultimately were to be paid in gold. When a bank note stipulated that it would "pay the bearer on demand" so many dollars, it meant payment in gold. Not anymore. The Gold Standard is a thing of the past, and the new standard that applies is in fact the "work" standard, since there is only one way the Have-nots can pay back, which is to contribute the only thing that they have: their work.
Until recently, this was fair enough. We knew that the poor would work and make good on the debt: they had to. Now, though, work disappears and we have reached the critical point where our production system has little need for the type of work that the untrained, uneducated, typical Have-not turned "Do-not" can offer. Until the day he is educated, trained, and assigned to some productive work, the "Do-not" cannot pay back the money he owes.
Is he to return to the sender the money he receives from Welfare? Obviously, this is not what we want, for otherwise Welfare would not have given him the money in the first place. Getting that money back is the last thing in the world we want, because there are also all these Corporate Bonds around: debts guaranteed only by an equipment which would become worthless if the Have-nots were asked to pay back their debts rather than buy all the goods they can.
Forget about paying back. Legislators may play with the concept of a "balanced budget", and even bind themselves to achieve this lofty goal, but trust good sense to prevail. Reducing the debt is about the most suicidal thought to entertain in this period of crisis and transition. To the contrary, we must borrow more, both individually and collectively; this is the only way to maintain equilibrium in motion and to optimize everybody's access to a reasonable share of welfare.
So, what about the debts, wealth and money? We should not even discuss the value of the "power chips" of the rich, since globally they are clearly not redeemable in gold, or anything else anymore, and could now, for all the practical purpose they serve, be replaced by small medals saying "the bearer is a great man". They could, but since we all have been conditioned to respect the authority of wealth and money more than that of medals, we will certainly not go for that change... if we can help it.
Let's not play ostrich, though. The fact we must live with is that wealth and power, in our society, now rest on two rather shaky pillars: a $l,850,000,000,000 bum cheque drawn on the destitute and permanently unemployed "Do-not" ..., and an investment in fixed capital for industrial production, which has value only insofar as prospective buyers are granted more and more credit to buy a production that always tends to exceed effective demand.
If a smart accountant scratches from our assets the worthless thingamajigs and the huge bum cheque, we will have to face the reality that we are rich, but not that rich, that a large part of our fixed assets are useless, and that money is only paper, after all, unless we can back it with a credible promise of welfare. This is the "joker" threat and we must be aware of that threat.
Which is getting more serious by the day. Not because the debt is growing, but because the less work there is for the Have-nots, the less solvent the debtors; the more the needs of the population basic and not so basic are getting satisfied, the less vulnerable the debtors to pressure from the creditor..., and the more the power vested in wealth becomes illusory, the more of a threat. Let's not dream that we may look the other way and let time take care of the problem. We must find a way to "restructure" that debt painlessly, and "finding a way" will mean agreement on new ways to work, new ways to invest, new ways to share and participate, ways that will have to satisfy debtors and creditors alike. We must agree that in this operation there will be no losers.
It is quite a challenge, but it must be done before somebody yells "The King is naked", and some simplistic fool decides in favour of a write-off. We must never forget that the 13-figure bum cheque is the symbol and embodiment of all the dreams and ambitions of the ruling power structure. The same power structure that made industrial development possible and which industrial development, reaching its logical conclusion, is now making obsolete. We better make some arrangements on the payment of that cheque, for power structures do not commit suicide.
The cheque must not be torn away! ... or else. Or else, confronted with phoney money and a crumbling power structure, you may bet that rather than a write-off that would mean ruin for top-dogs, economic collapse and social anarchy, our decision-makers would decide for another round of the same thing, within the same framework and under the same type of leadership. We would face the traditional "alternative" to evolution.
The "alternative" is, rather than to let work disappear, to keep manpower at work ... turning all workers into soldiers; to keep wealth "productive", even if it means blasting most of everything away so that it will have to be rebuilt, and to get rid of the huge bum cheque through the inflation that always comes when we get war rather than change, meaning a write-off of most wealth save that of the Most Powerful Ones. Simple, well tested time and again, and proven effective. The only itch is that it will bury our children, together with our past mistakes...