The title of this book comes from a quote from Hegel (whom Zizek references quite a lot throughout this text) in relation to the collapse of the German aristocracy in the mid-nineteenth century. The reason for the statement was that historical events always happen in pairs – the first is a tragedy (in reference to the collapse of the French aristocracy) and the second time it occurs it is farcical. In using this reference Zizek indicated that the attacks of 9/11 were the tragedy while the global financial crisis was the farce. In a way I have to agree with him, despite the fact that the two events had nothing in common (and I doubt that this is what Hegel was referring to). In a way 9/11 was somewhat unavoidable in that it came almost as a complete surprise (though one could argue otherwise in that there was quite a lot of chatter leading up to the events that the Bush administration ignored). However, the farce surrounding the global financial crisis, and its response, was nothing short of laughable – how can one expect that a loan made to somebody who doesn't have any money, and has no way of getting any money, will ever pay it back.
In a way I not entirely sure if any form of credit crisis can be considered a tragedy, in a sense that when people make incredibly risky investments there is always going to be the possibility that they will lose all of their money – and the riskier the investment the higher the possibility to the point where the loss of the investment is an absolute certainty – give money to a person who has none to buy a flat screen TV and go on a holiday then that money is gone, for good.
In essence the book is about capitalism, and also a call for the disenchanted communists to come back and once again raise the call to change the narrative. In a way what Zizek is saying is that we simply cannot sit around and wait for something to happen – it already has – because if we do then nothing is going to change. The Global Financial Crises was seen by many at the time as the death knell of capitalism (I know I saw it as such) – however seven years after the event capitalism, or as Zizek says 'Post-Modern Capitalism', is still very much alive and well. The same goes with the figure that could change the narrative – Obama was seen to be that man, yet the United States is still the same United States as it was prior to his election – it is just that it now has a more human face. Eight years after his election we are all now looking to 'Feel the Bern'ie Saunders as our new hope (in the same way that the Libertarians have been looking to Rand Paul for, well, forever, as theirs).
Anyway, as with many of Zizek's writings, there is a substantial amount of information packed into this little book, and he writes in a way that all he needs to do is make a statement and a whole heap of ideas suddenly start flooding into my head. Further, Zizek wouldn't be Zizek unless he makes at least one reference to his favourite movie of all time – Kung Fu Panda. Anyway, I will try to discuss some of the major themes that came out of this book here:
The Narritive as Truth
The modern economic system is not based upon any provable assumptions but rather a narrative. This is why I believe he keeps on referring to the modern system as post-modern capitalism. It isn't that it is based upon any proven economic theory – that went out the window long ago – but it is rather based on a narrative. While many of us on the left hailed the global financial crisis as the end of modern capitalism, it didn't actually turn out that way, namely because the narrative never changed. In fact the narrative continued on as it did before. In the end the workers are still being exploited, the bosses are getting richer, and the income gap is wider than it has ever been.
Many of us believed, at the time, that another Great Depression would come about as a result, and in a way we welcomed it. The reason for this, I believe, is because as history demonstrated, when the economic system collapsed in 1929 the narrative began to change,.The people saw that the unrestrained capitalism of the 1920s had failed, and in came John Maynard Keynes and Franklin Delanore Roosevelt who managed to change the narrative and shift the American culture back to the left, which involved placing heavy regulations on the banks to prevent the wholesale speculative lending that brought about the crash. Mind you, this created a lot of concern within the wealthy class to the point that they even attempted to coup, which was only brought down because their proxy, General Smedley Butler, had become sick of fighting wars for big business and blew the whistle on them (though none of the agitators were never changed with treason).
However come 2008 and there was no change in the narrative. No doubt the wealthy class had learnt their lessons from the past and did all they could to keep the narrative in place. Of course that narrative, as it has always been, boils down to one word – jobs. In fact it is a narrative that has kept the right in power for a long time, and also dragged the traditional left leaning parties over to the right. If there is one thing that the average voter on the street is concerned about and that is their job – without their job they can't meet the mortgage payments on their houses and they can't feed their families. As such, by creating a fear within the voting public that they would lose their jobs, they agreed to let the governments do whatever they could to keep the economy afloat – including pouring over a trillion dollars into the financial system to buy up the bad debts.
The End of Capitalism
As far as I am concerned this is not capitalism as it is supposed to be. The whole idea of capitalism is that people take risks, and by taking risks they can earn money, however the reason that it is a risk is because they can lose it all. This is how capitalism is supposed to work – by creating risk people learn to mitigate their risks, and those who are reckless lose everything, and those who a smart can make it. What 2008 did (and this wasn't the first time it happened – in 1998 Long Term Capital Finance was bailed out after their wonderful money making equation turned out to be a dud) is that it removed risk, but not for everybody. The thing is that us small timers still have to risk our money, while the big banks can play wild games of speculation and if they lose everything they can expect the government to come and bail them out.
Not so with poor Joe the plumber. The classic idea of capitalism is that Joe the Plumber, who works for himself, competes with the other small plumbers in the town, and he makes a decent living by the work of his hands. Sure, we have companies that come along that provide services to assist them in running their business, but they also have to confront something known as economies of scale. Many of the small business simply cannot compete with the likes of Walmart. Tom the butcher, and Dan the grocer simply do not have the logistical support to be able to compete against Walmart – and when Walmart is handed huge tax breaks it works further to undermine the competitive nature of the market. This isn't a more efficiently run business driving the less efficient ones out of business, this is a huge company that uses its influence to force the government to pretty much give it what it wants.
The truth is that after the Global Financial Crisis capitalism had died and no matter what the governments have attempted to do they haven't managed to revive it. The problem is that capitalist theory shuns government intervention, and many of the right wing commentators have been decrying this ever since. The more the government does to try to save the economy, the more of a mess it creates. For instance the central bank not only lowered interest rates to 0, but that also started printing money (though we can't use that term anymore because it doesn't fit the narrative: it brings back memories of hyperinflation, which will cause panic, and that is the last thing the government wants because the modern economic systems runs on confidence, and when there is no confidence the market suffers – once again we see the need to control the narrative to save the economic system). However, even after seven years, the economy is still suffering, and further shocks are coming about that are preventing a full recovery (first there was Europe, then there was Greece, and now there is China). Of course, lowering interest rates only works to exacerbate the problem because then people become addicted to easy credit, and once interest rates are raised well, you have 2008 all over again.
To be honest with you, I'm not a communist – I'm a democratic socialist. I believe that there are merits in the capitalist system that benefits all of society – such as the spirit of the entrepreneur. All you need to do is walk through the streets of Melbourne and see all of the small businesses flourishing. Even then the might of the fast food duopoly is being challenged with the rise of the gourmet burger bar. In fact these burger bars have learnt to create a narrative of their own – namely they are not McDonalds. As such people are willing to pay more just to not eat burgers at McDonalds.
However, along with capitalism I believe you need safe guards. The problem with capitalism is that it believes that everybody is fit and healthy and can work to a ripe old age. Unfortunately that is not true. It also assumes that everybody is a shrewd and canny businessman, able to sell their skills to the highest bidder – once again that is not true. The thing is that just as we need the government to fund the police and the military to protect the peace, we also need to government to keep a tight reign of the power of the businesses so that they don't grow too big and end up exploiting people. That is why I yearn for the Republicans of old – the Abraham Lincolns, the Teddy Roosevelts, and the Dwight D Eisenhowers. They understood the limits of capitalism, and were willing to impose those limits.
My economic solution is to give money to people who will spend it, but also encourage them to save. You see by putting money into the hands of the working class will mean that they will spend it, and by spending it they will keep the wheels of economy spinning. Tax cuts for the rich does not encourage investment, it just means that more money is being taken out of circulation. Allowing mega-coporations to dominate the landscape who pay employees as little as they are legally allowed once again takes money out of the system. For the economy to work, and to grow, the money needs to be put into the hands of people that will spend it.
World of the Neo-Fuedalist
Gee, I seem to just keep on writing this review, namely because there is so much that I could say, despite the fact that one normally finished with 'the solution'. However the thing about the modern world is that we are once again returning to the age of the feudal society. We have a new aristocracy – the bosses – who will go from business to government and back again. Sure, you can enter their world, however you need to be invited. Many of us, even if we make it to middle management, can never get to the point where we pass through the door into their world. You see these people sit in the position that was once held by the lords and ladies of the land, and even had power over the king. In fact the king had little power unless he enjoyed the favour of the feudal lords – just as these days governments rise and fall on the favour of the media barons.
We, however, are the new serfs. Sure we may have a semblance of freedom, but many of us are debt slaves, needing to work to service our debt. In fact the modern world seeks to make us debt slaves as soon as possible with the idea of turning universities into private institutions. While in Australia one's university debt is still a clayton's debt (it's a debt, but you don't actually have to pay it off), this is not the case in the United States. These days it is very hard, if not impossible, for the average middle class punter to ever pay of their debt. Once they are out of university and have a job, they then go into debt to buy a house, and then must continue to go into debt, or pay rents, to be able to survive.
The power of the feudal lords came from the fact that they would collect rents off of their serfs, and their serfs were bound to their lands. Our modern debt binds us to our jobs, meaning that to survive we need a stable and secure job, which gives power to those in authority. Whenever the spectre of losing our jobs arises, we immediately flee to those who promise (and are no doubt lying) to protect their jobs. This is why the Republican Party, despite being so extreme, and are acting against the interests of the middle and lower classes, are able to remain in power – the fear of one losing one's job.
When we take out a loan to buy a house we aren't actually buying a house, but rather paying rent to the bank that holds the mortgage. In many cases we will never see the day when we will pay off our mortgage (especially since banks are always keen to encourage us to draw down on our mortgage, thus extending the period on which we will eventually pay it off). In fact most corporations these days are little more than rent seekers. They don't offer anything of practical purpose, just a piece of paper that promises something. Health insurance is a classic example. The reason that Obama is having so much difficulty enacting health care reform in the United States is because the HMOs see that their rents will be attacked. If people have free and available healthcare, people will not take their services. Once again this is the lie that is being peddled here in Australia to boost the profits of the HMOs – the government can't sustain the burgeoning medical costs, so we have to take out private health insurance (with its huge yearly increases) in case we become sick (and it turns out that if we claim under our health insurance it ends up costing us more).
The Truth About Freedom
I remember writing an essay back in high school about freedom. It began with 'freedom is a state of mind, freedom is a lie'. I had just come off of unemployment benefits, and was now on Austudy (the payment made to school students). The reason I wrote that was because I was not economically free. I was living a hand to mouth existence, which meant that I did not have freedom of choice or freedom of action. My choices were limited by the amount of money that I did not have. Now I find myself in a different situation. While I am not on a huge income, I am on enough that I am no longer living a hand to mount existence, and have learnt to be content so that I no longer am restricted by my financial situation. However my lack of freedom comes from the fact that I spend eleven hours either at work, or travelling to and from work (though the hours I spend travelling to and from work are spent reading).
These days the word freedom is thrown around a lot, however it is a misnomer. George Bush talked about freeing the Iraqi people from tyranny, however that, as we all know, was partially a lie. Sure, he wanted to free the Iraqis, but when the Americans talk about spreading freedom, it is not political freedom, or even economic freedom, it is what we call free trade. This has always been the way that the term freedom has been used – to the people in power, to the businessman, freedom is the freedom to trade without government interference. However to the people it is freedom from tyranny, and this is why it is used so much because people see it differently (which is why the American people fear universal healthcare – the Republicans claim it to be an attack against freedom, that is free trade, while the general masses is it a the beginning of the path to tyranny).
Zizek looks back to the revolution of 1968, a period that I will refer to as the summer of love. In a way it is similar to the Chinese revolution of 1989. The people went to the streets demanding freedom, however the governments by that time realised that they could maintain power by simply giving some freedoms, while maintaining control. When the French revolution occurred the entire system collapsed because the government refused to give any freedoms to the people (or moreso the bourgeoisie). Since then when periods of protest have come about governments have initially responded with violent suppression (and this happened in 1968 as well), however after the initial protests were put down, they gave up some of their controls. This has worked, and has worked really well. Throughout the 19th century the English government enacted systems of universal healthcare and education, in 1905 in Russia Czar Nicholas established the Duma. In 1968 the Western governments began to gradually removing the 'morality' laws, such as a lot of sexual acts that were at the time criminal offences. In China they allowed economic freedom.
Anyway, I have written quite a lot, so I think I will finish it off here. A part of me wishes that I have more time to really flesh out these ideas, and do a lot more research, however I have read this book and it is time for me to move on to the next one (and there are a couple of more Zizek books on my self, including The Year of Dreaming Dangerously, which is about the Arab Spring).