Home > Uncategorized > If history follows the path Thomas Piketty noted, it will . . .

If history follows the path Thomas Piketty noted, it will . . .

from Ikonoclast  (originally a comment)

If history follows the path Thomas PIketty noted, it will take a major war or revolution to change matters. Each time profit rises faster than the overall rate of growth we get a war, like WW1 or WW2 or a great depression like most of the 1930s. Sometimes we get the depression, then the war. Piketty noted that under capitalism’s axioms:

If R (rate of return on capital) is Greater Than G (growth in inflation adjusted dollars) then inequality increases.

There are real limits to the increase in inequality. People reach the point where they will not tolerate greater inequality. They will rebel against the system and elites enforcing the inequality or be diverted by elite misdirection into attacking others.

Piketty’s “Conditional Law of Approach to an Asymptote” (my clumsy title for it) is fully compatible with Capital as Power theory. There is no need to assume that R and G are measuring real wealth. They are simply the ratios of nominal capital being assigned to each variable by the calculations and operations of the capitalist financial system. Since money does not measure value but rather implements creorder power, then the relative power of the owners of capital axiomatically increases and the relative power of the rest of society axiomatically decreases. However, the decrease in the relative power of the bulk of the people has a lower real limit (more a band than a precise point) this being the physiological or psychological limits beyond which people find life intolerable or impossible. The rise in real inequality will be found to have real limits.

The elites seem determined to push matters to those real limits just as they appear determined to push the biosphere to and beyond the environment’s real limits. We are already in environmental overshoot. We also may not be far away from inequality limits. Rapid evnvironmental recoil or snap-back coming the other way will meet increasing inequality: two asymptotes interfering and compounding. The system will rapidly destabilize without timely preemptive action on both fronts.

That’s me being a keyboard warrior. ;)

  1. June 12, 2021 at 12:30 am

    We wrote several works on the asymptotes of power.

    One, published in 2012 — ‘The Asymptotes of Power’ — examines the distribution of U.S. national income, from the overall division between labour and non-labour income all the way down to the share of net profit going to dominant capital (the top 0.01% of all U.S. corporations). Based on long-term data trends, our conclusion in this paper was that the power of U.S. dominant capital was approaching its asymptotes in the sense that further redistribution in its favour is bound to become harder and harder. [http://bnarchives.yorku.ca/336/]

    Another paper, titled ‘A CasP Model of the Stock Market’ and published in 2016, examined the power relationship between the capitalists who own the the S&P500 and the U.S. labour force going back to the mid 19th century. The paper studied the three way connection between rising capitalized power, the strategic sabotage necessary to sustain it, and the systemic fear of investors that this growing power inevitably gives rise to. Here, too, we identified some rough asymptotes beyond which capitalized power becomes fragile [http://bnarchives.yorku.ca/494/]

    For recent work on this subject, including at the international level, see:

    Joseph Baines and Sandy Hager, ‘Financial Crisis, Inequality, and Capitalist Diversity’ (2020) [http://bnarchives.yorku.ca/599/]

    James McMahon, ‘Reconsidering Systemic Fear and the Stock Market’ (2020) [http://bnarchives.yorku.ca/643/]

    Blair Fix, ‘How the History of Class Struggle is Written on the Stock Market’ (2020) [http://bnarchives.yorku.ca/658/]

  2. June 23, 2021 at 5:21 pm

    Perhaps, what the super-wealthy yet still growth addicted are lacking is for someone to declare ‘Game over.’, as in a basic game of Monopoly. When one player holds all the money, play = continuing economic activity ceases, so the game cannot go on. For activity to begin again, the game must be reset to the starting, equalised conditions.

    Because our ‘finance’ industry is permitted to go on manufacturing ‘IOUs’ and then using them for exchange, there is never any end to the game in real life, so, if the dangers warned of by Smith, Malthus (where population is the ‘growth’), Marx, and now, Pickety, are to be avoided, the World needs a ‘Game Master’ to decide the overall winner, congratulate him/her, and reset the counters on everyone’s bank accounts, and start again. Individuals will never let go of their worthless ‘Monopoly Money’ because they have forgotten that it only exists to facilitate the playing of the game: the game which is our lives.

    It won’t happen, of course, so those ‘Four Horsemen’ will continue to adjust things in their time-honoured way.

    PS: I used to think that surveillance culture would eventually make reset by revolution impossible: I had not imagined how the virtual reality game culture on the internet would be abused and weaponised to create brainwashed armies like the MAGA and Q conspiracists. Jan 6 demonstrated that revolts can still be fomented, when the self-appointed (through their understanding of the tech and psychology) game controllers have access to all the world’s computers and databases, and can control both the revolutionaries and the security services, politicians and polls, and the law itself.

    Zev Shalev’s ‘Narrativ’ webcast had a calmly chilling go at explaining the current state of play yesterday: https://m.youtube.com/watch?v=PJ_wtGzo5h4

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