Here’s why rising social disorder is inevitable

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From Charles Hugh Smith at Of Two Minds:
We can do better, and if we don’t, the only possible output of such an unequal system is increasing social disorder.
We are in a very peculiar point in history. On the one hand, we’re reassured that all is well because Every One of the World’s Big Economies Is Now Growing. (NY Times)
Yet at the same time, we read that “Something Is Very Wrong With The Global Economy”: Richest 1% Made 82% Of Global Wealth In 2017 and are asked, Can the World Survive a Winner-Take-All Global Economy?
Even the authors of the rah-rah NY Times piece on the wonderfulness of the global economy expressed concern that this “growth” may not be distributed any more equally than the previous 10 years of “recovery.”
We already know absolutely nothing will change because neither the inputs nor the feedback loops in the economy have changed. As Donella Meadows explained in her seminal paper Leverage Points: Places to Intervene in a System, the only ways to change a system’s outputs (in this case, widening income and wealth inequality and rising social disorder) is to change the inputs or add a new feedback loop.
The status quo has not changed the inputs or added any new feedback loops, so the output of the system–extremes of widening income and wealth inequality–cannot possibly change.
The portmanteau word “precariat” (precarious + proletariat) describes much of the modern work force–those in the less specialized sectors of the gig economy, informal/black market economy or in the traditional corporate-employment economy but with irregular work hours and little in the way of benefits.
Since the corporate media (MSM) is largely a haven for well-educated bourgeois with some family wealth and upper-middle class social circles, media coverage of the slow drip of financial anxiety in the lives of precariats is sparse.
If you talk to people working in the lower-pay service sector, you get a snapshot of a great many people living paycheck to paycheck, worrying about any unexpected expense (car repair, dental work, etc.) and mundane things that don’t vex a “protected” upper middle class employee like scraping up the cash to buy their child a new pair of shoes for his/her birthday.
If we compare this reality with financiers and their technocrat worker bees skimming millions from what Adam Taggart calls “the river of money” (mostly credit, of course), we have to wonder why the US hasn’t already exploded in class warfare.
The fuse is lit, as “fixes” like Universal Basic Income (UBI) that are embraced by the likes of Mark Zuckerberg don’t actually re-enfranchise precariats, i.e. offer a real stake in the nation’s productive capital. As a result, they’re just Band-Aids over a sucking chest wound.
Much of my work is focused on explaining the intrinsic limits of the two “solutions” offered by conventional ideologies, think tanks, pundits, etc.: the market (i.e. the neoliberal fix for everything) and the state (government can fix everything). As I have explained, our problems are now exacerbated by markets and centralized power, not fixed by these dynamics.
I’ve endeavored to lay out a Third System that is decentralized, democratic and not dependent on either the financialized, globalized marketplace or the centralized Savior State in my books A Radically Beneficial World and Money and Work Unchained.
The core dynamic of my system is the universal opportunity to acquire productive capital in all its forms. The core dynamic driving the current extremes of wealth/income inequality is the system’s rewards go almost exclusively to owners of capital and those closest to the central bank credit spigots.
The conventional solutions (“tax the robots,” UBI, more job training, etc.) don’t actually change the reward structure or the opportunity to acquire capital. This is why they have failed and why they cannot do anything but fail: they don’t grasp the problem and they don’t actually change any inputs, incentives or add new feedback loops.
There are solutions, but they lie beyond the status quo of stale, failed ideologies that have lost touch with the real economy and those being left behind by a system that radically favors owners of capital and those closest to central bank credit spigots.
We can do better, and if we don’t, the only possible output of such an unequal system is increasing social disorder.
Gordon Long and I discuss social disorder in Part 2 of our series 2018: Year of Accelerating Social Change (15 minutes):

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This essay is drawn from Musings Report 4, the weekly email sent exclusively to patrons, contributors and subscribers who pledge $5/month or more. Thank you for financially supporting my work.
Crux note: Charles is one of our favorite independent financial thinkers and writers. His Of Two Minds blog was listed as No. 7 in CNBC’s top alternative financial sites. And his commentary has been featured on Zero Hedge, The Daily Reckoning, and Peak Prosperity.
We recommend his new book Money and Work Unchained at a 10% discount ($8.95 for the Kindle e-book and $18 for the print edition) through December, after which the price goes up to retail ($9.95 and $20). Read the first section for free in PDF format.


1 thought on “Here’s why rising social disorder is inevitable

  1. there is nothing that can be done to stop the implosion of the world economy ……. and it’s not going to be pretty ( to put it lightly … )

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