Our elite despise us. Is it because we fail to understand that all politics is market manipulation?
A speculation
Essential first to caveat that I am not an economist. My interest in politics has however led me to be interested in economics too. From the broad-brushed opposition stances of ‘free-market economy’ versus ‘redistributive economy’ to something a little more detailed, although still strictly amateur.
I asked my opening question because it popped into my mind fully formed after I read an arresting article on ZeroHedge: ‘Larry Fink’s Fake ESG Facade Crumbles As Blackrock Names Aramco CEO To Its Board’. It’s well-worth reading the article itself, but its main point is that having backed off ESG in a highly publicised comment in June, Blackrock CEO, Fink, has now appointed Amin Nasser, the head of Saudi Aramco a Saudi Arabian petroleum and natural gas company, as Blackrock’s independent director.
When Fink made his comments towards the end of June it was interpreted by many as a sign that the pressure exerted, for example by American states that had taken their pension investments from Blackrock, was finally causing the greatest promoter of the ESG scam to rethink his position. This may be true, it is impossible to know anything for certain, but the author of the article suggests that in fact the ESG scam was somewhat different from what we had first thought. Rather than simply being a way of impoverishing the West through a perverse incentive programme for disinvestment in fossil fuels and growth, whilst increasing investment on substandard ‘renewables’, it was in fact a way of luring unsuspecting investors, large and small, away from fossil fuels.
Blackrock itself had of course hedged its bets, keeping a substantial part of its fossil fuel investments whilst claiming to be nudging those companies towards “energy transition plans” to provide a green sheen, both to the companies and itself. However as it becomes increasingly clear that the ‘green’ technology currently available is not going to fulfil energy needs of the planet, even a little bit, Blackrock is primed to turn on a dime and cash in on an anticipated rush of investment and productivity back to fossil fuels.
This got me thinking. All the words and speculation wasted on what ESG was all ‘about’. The anguish felt and expressed over the defiance of, what could be seen as the ‘natural laws’ of economics that ESG wrought: boosting the standing and investment appeal of companies that did not have a competitive product, whilst downgrading companies and sectors with a proven record of genuine profitability, but who did not recycle enough. But has all this wailing and gnashing of teeth, by me included, been pointed in the wrong direction? Have the perversions of ESG simply been another way of manipulating the market in a way to bring predictable profit opportunities to those in-the-know all along?
First in, first out. Creaming off the largest share of profits as they go. The ESG scheme upgraded companies and sectors that were otherwise a so-so investment opportunity, and made them appear attractive, increasing their price until, the inevitable, ‘correction’ when the unsustainability (ironic) of the company or sector became clear and imminent implosion evident. A further fillip to this joyful arrangement is a comprehensive knowledge of which sectors and which companies are truly productive and therefore an ability to get back into the, now under-priced, game while the rest are still shaking their heads at the sudden fall of ‘Cow Fart Capture Inc’. When the ESG dunderheads catch up they will lift the value of those under-priced fossil-fuel companies and related sectors nicely, thank you very much. It’s a twofer.
We’ve seen this on a smaller scale before. Nobody needed to move to diesel cars, in terms of respiratory irritation their emissions are worse than those of petrol cars, but to governments and treasuries suffering after the 2008 financial crash, a push and a subsidy-nudge to diesel vehicles breathed life into a moribund market, keeping the economic wheels grinding on for a few more stuttering years. Same with the ‘green energy’ sector, a heavily subsidised synthetic sector that is more-or-less worthless without constant injections of tax-payer money from governments desperate to paper over the low productivity of their own economies. The ‘worth’ of the ‘green sector’ comes almost entirely from its manufactured returns on investment that are provided from its hoovered up government money, not because wind turbines are economical to make or provide a viable or profitable way of making electricity.
Is much of what we consider to be politics just economics? Just people trying to make a buck by manipulating the system? The controversies of the ‘trans debate’ may in fact boil down to certain charities and campaign groups needing to keep the dollars rolling in despite the fact there were no more battles to be fought on the gay battlefield. Like any company not wanting to lose investment (donations) or cut employees they simply looked for another area to move into and there the ‘trans’ controversy was born, in the margins of a spreadsheet.
The ongoing push of surveillance technology, whilst clearly underpinned by an unhealthy desire on the part of our governments to know every tiny thing about us, is also driven by technology companies that see a vast new area to move into. In fact in the way of so much of the ‘green sector’ the high-tech surveillance companies are often selling a pup: under-developed technology that is ineffective (a hope to those of us who abhor the advance of the surveillance state). Similarly investment is directed into this burgeoning, untrod territory and a vicious cycle begins of sector proliferation as companies chase investment dollars and subsidies.
Again and again phenomena that we have tried to interpret in moral terms, psychological terms, political terms may, in fact, best be described in economic terms. Money is to be made in people’s poor health (Big Ag and Big Pharma) that limits political willingness to tackle unhealthy habits and the sugar industry. There is money in vaccines too so no political push for an examination of true harms and benefits. Plenty of investors in ‘green sector', so keep questioning of Net Zero to a m-i-n-i-m-u-m. And so on.
Our economies, certainly in the West, seem to be based on a complex web of lies and misapprehensions. To a large extent European economies are fake, based on the value of portfolios or sectors that have in fact no intrinsic value and are not, in any meaningful sense, productive. Each lie, over the profitability of wind-produced electricity, the environmental friendliness of rare-earths-dependent electric cars, the dangers of dietary fat, forms with countless other lies a huge edifice, an economy that is based almost entirely on dishonesty.
The pinnacle on the edifice is the form of ESG scoring the large financial institutions use for each other and for the economies of nations. This globo-Marxist ESG scoring is why a new Prime Minister could announce a pursuit of low-tax, high-growth economic policies for her nation and witness a total crash of the value of the currency almost immediately. Ink and tears have been spilt over whether the currency devaluation was coming anyway. The point is whether it was manufactured, almost certainly in part, by a loss-of-confidence soft-shoe-shuffle performed by the large financial institutions who prefer big-tax, redistributive economies. Whether that currency was about to receive a vote of no confidence anyway those large financial institutions blamed the low-tax, high-growth policies for the economic wobble of the nation and that tells you all you need to know.
In today’s economic system of a small number of huge national and international banking institutions, high-tax, big-spend government is in vogue, and until we can find a way of loosening the strangle-hold of these ‘institutions’ high-tax, big-spend government is what Western nations are going to get.
Again, not an economist, but it seems as if we need a recalibration. Certainly back to actually, truly productive sectors. It may seem like pie-in-the-sky to suggest making more stuff domestically. The chorus will shout, ‘who will buy it when it’s cheaper from China?’ but as the price of everything sky-rockets people may start to be more thoughtful about where they spend their money. In the distant past people bought quality goods that were built or made to last and that had large amounts of residual value in them. This is where the world’s antiques market comes from, beautiful items, made from real materials, employing great skill. Hundreds of years later those items are worth more than they were when they were first made. Now how many of us have anything, a table, a vacuum cleaner, a coat, made in the last twenty years, that is of such superior quality that once we have had use of it we could sell it on to somebody else, even at a profit? None of us.
As we have become poorer, as the financial crash of 2008 impoverished so many of us and left us with bank accounts that paid zero interest and still do, even as interest rates now are rising, we can only afford to buy trash. Fast fashion. Appliances made in China that, if they do not break within the two years we own them, can only be passed onto another for a fraction of what we paid. Cheap china and glassware, ditto cutlery. Who can afford to buy good art now, or good furniture? Who even makes well-designed and crafted furniture in proper wood anymore? Who can afford to buy antiques?
The average annual wage in the UK is $53,896, in the US it is $74,738, and in Sweden it is $53,501. Globally there are 2,668 billionaires in 2023, so the unavoidable question is: Are we, and have we been for decades, living on a Marxist planet? That may seem like a strange statement as I am describing vast inequality, but Marxism in practice has meant everywhere, Russia, China, redistribution of any wealth from the population to a tiny, ruling elite. Has it been happening to us for decades, and we have been too happy with our crumbs to notice?
I am broadly speaking a capitalist, but I’m not in favour of the kind of global capitalism we have now, where the powerful companies lobby governments to provide regulatory systems that favour the large and powerful corporations and discourage and impoverish smaller competition. It is beginning to look as if this is not really free-market, petit-bourgeois capitalism at all, but a melding of state and giant corporations to gain control of people and wealth. There used to be a word for that.
We need to move away from economies that allow market manipulation, and move towards genuinely productive economies backed by real resources, oil, gas, coal, forestry, precious metals, domestic food production, supported by abundant and cheap energy from fossil fuels, nuclear, and hydropower, where applicable. We need to keep industry and manufacturing within our borders. Only where wages are stagnant in real terms do we have to outsource production to cheaper locations. If we can make our energy cheap and abundant and we can stop the fat cats skimming off all the cream of successful companies we can pay decent wages and produce good-quality products that ordinary people can buy with those wages, and still have enough for a mortgage and a holiday abroad each year. And with real markets and real companies, producing real, actual profits we may be less subject to the vagaries of wild political nonsenses that are promulgated just to try to lure money into implausible sectors.
It could happen.
