Our 2021 fundraiser starts today. If you already know you want to give, please go directly to the Tip Jar, which tells you how to support us via check, credit or debit card, and then come back pronto! We will be very grateful!
We use this kickoff post to play Janus: look back over the past year (in this case, the 13 1/2 months since our last appeal) and do a wee bit of prognostication.
As we’ve often said, the global financial crisis was a shock to elite complacency. It showed that the myths about the virtues of unhampered markets were destructively false. But the short-term success of massive central bank-Treasury rescue operations restored their faith. But over time the repercussions moved from the financial to the political realm, via obvious, corrosive injustice (the failure to hold anyone in power accountable), the lack of meaningful reforms, and the salvage operations, particularly super low interest rates, which widened inequality and increased real economy distortions by rewarding leveraged speculation above all.
A Biden win was sold as a return to pre-Trump civility with “the adults” in charge. Yet Biden himself promised that “nothing will fundamentally change.” That meant the Democrats believed that only cosmetics and better PR were needed to cope with intensifying crises, such as a climate emergency, rising social fissures produced by gaping class disparities, and a pandemic that had already generated widespread lockdowns, travel bans, school closures and crisis-dwarfing rescue operations.
What we are getting instead, as the Covid keeps grinding on, is early stage collapse. It may be possible for officialdom to pull out of the downward trajectory, but so far, they seem unable to control their neoliberal reflexes or even recognize their abject incompetence. In an embarrassing example last Sunday, Transportation Secretary Pete Buttigieg on Fox and CNN confirmed his career consisted of failing upward. He presented vaccines as the solution to the supply chain crisis, along with having parties who have no legal relationship with port operations to somehow fix the ports:
Fundamentally, it’s up to the producers, the shippers and the retailers and we’re doing everything we can to help them move those goods across the infrastructure that’s often outdated.
This was yet another “The Emperor has no clothes” moment as far as the legitimacy of top professionals and managers are concerned. Buttigieg confirmed that the Administration planned to do noting about the port logjams out of the cheery belief that it would sort itself out and merely saw it as an opportunity to get air time and mouth Biden Administration talking points, vaccinations and the infrastructure bill. As reader John put it:
I think Mayo Pete misunderstood regulatory capture. He thought the transportation lobbyists would do all the work and he would have to do nothing more than photo ops in a crisp suit and tie.
And in so doing, he exhibited what Lambert has called late Romanov-era incompetence, a complete lack of interest in, much the less understanding of, why shortages are becoming more and more widespread and are destined to get worse: The parties who are in a position to address the mess will profit enormously from doing nothing.
The root cause is the slow and steady operation of deregulation and financialization. That has led over time to restructuring of large scale enterprise away from performing many activities under one roof to outsourcing and offshoring. These processes amounted to squeezing low-level workers and increasing risk to the benefit of top managers. These same companies often doubled down on fragility by thinning their vendor ranks, making the survivors more dependent on their customers and therefore able to be hammered on their prices and other terms.
These brittle yet essential provisions systems are too often run by people who genuinely believe that if they can make things work in a spreadsheet or sound plausible in PowerPoint, that’s tantamount to making things work in the material world. That class overwhelmingly has sunk into narcissistic self-regard, unwilling to learn from anyone who isn’t credentialed (save the Mustache of Understanding’s occasional chats with taxi drivers) and do the hard work of investigation, which sometimes means visits to the boonies, and understanding how things outside their bubble operate.
We’re seeing similar breakdowns in other economies. In the UK, the failure of the Government to comprehend what Brexit would amount to, because of ideology or looting opportunities, is now producing serious dislocations, starting with food and petrol shortages. China’s production is suffering due to power rationing, higher commodity costs, coronavirus outbreaks (albeit trivial by US standards), and internal supply chain issues. Oh, and Europe is also suffering from pricey and sometimes scarce power too above and beyond the consequences of global price rises. And another stressed but less discussed critical supply is fertilizer, where a price spike will translate into smaller harvests and higher food costs, which translate into social instability, as Tahrir Square (among other events) showed.
And we’ve conveniently averted our eyes from the climate emergency, which is becoming more and more visible, between more frequent and severe fires, more frequent and destructive storms, and alarming long-term developments, like a slowing of the Gulf Stream, and massive methane releases from Siberian permafrost.
This is all sobering, but it’s also the sort of unvarnished assessment that the mainstream media rarely offers. It’s an indictment of our leaders, with which the press identifies and often needs to coddle in a world of diminished newsroom revenues and dependence on access journalism. It also takes effort to dig beneath the surface, along with an understanding of how institutions behave and sensitive bullshit detectors. And that’s not in their commercial interest. Not only don’t we get invited to the right cocktail parties, let alone the “right” news shows, but mainstream media outlets also run lifestyle fluff and go easy on gloomy realities because advertisers. So we hope you value these sacrifices (although truth be told I hate parties) and chip in at the Tip Jar.
In other words, the Naked Capitalism team, Lambert, Jeri-Lynn, Nick, and regular guests like Michael Hudson, Tom Neuburger, Hubert Horan, and John Siman, are here for you. We are engaged in service journalism. We do our best, every day, 365 days a year, to give you our distilled assessment about what matters on a macro level and how some of them might affect you on a day to day basis.
For instance, when I started blogging about what became the global financial crisis, many readers told me they battened down their financial hatches and were defensively positioned for the September-October 2008 meltdown. During the foreclosure crisis, we similarly had readers who were grateful for our coverage because we publicized the cynical and incompetent operation of the HAMP program and kept some readers from defaulting to qualify (as HAMP counselors recommended!). We’ve increasingly been chronicling predatory practices in health care and hope some of our articles on surprise billing and dodgy Medicare Advantage plans have alerted readers to rraps.
It’s become more challenging to meet this lofty goal as the shocks from the papering over the financial crisis have reverberated in the political arena. But we keep at it tirelessly because you value that even when our views have been unpopular, we’ve been willing to make early calls and they’ve overwhelmingly been right. Lehman. The financial crisis bailouts and mass foreclosures as government-sponsored transfers to the well-off. The 2015 Greece bailout negotiation. Widespread misconduct in private equity. Unicorns. Brexit. The possibility of a Trump win in 2016. Covid-19. The supply chain crisis.
And of course CalPERS.
That list alone should persuade you to head straight to the Tip Jar and help us keep punching above our weight!
You readers have been critical to these successes, as well as timely and incisive commentary on many other topics, such as US and UK politics, MMT, interest rate policy, the right to repair, creaky IT systems, antitrust, the war on plastics, labor. The NC commentariat provides us with important early warnings and course corrections, and isn’t shy about boxing us around the ears when they think we’ve gotten something wrong.
We expect the upcoming year to be wonderfully clarifying, as Lambert is wont to say. We don’t expect the supply chain crisis to get better and believe it is likely to become more acute, even absent a Covid winter surge. Biden’s plunging poll ratings and poor off-cycle election result point to 2022 elections where the Democrats hemorrhage elected officials, just as they did in 2010. And even if that happens, it’s hard to see the party remaking itself. It’s not about to purge all of the Clinton and Obama hacks and their consultants, for instance. Biden might escalate his China or Iran eye-poking to look more Presidential than he has.
In the UK, Labour is in such a shambles that it is unable to take advantage of disastrous Tory performance: the utter mismanagement of its Brexit, far worse supply chain shortages than the US, off and on Covid surges, and deteriorating performance of the NHS (slow rot was the plan to justify privatization, but wheels falling off isn’t a good look). Jousting with the EU is likely to continue as a device for generating distracting headlines.
And here is where you readers come in. Collectively, we try to get past the propaganda and understand important, underlying developments in the realms of finance, economics, and politics. And with the considerable help of observant, rigorous, globe-and-walk-of-life-spanning and well-plugged-in commentariat, we’ve been able to cover vastly more ground than we used to, despite having what amounts to 1.7 full time writer equivalents. If you value this informational heavy lifting, please go straight to the Tip Jar and give generously.
We regard our mission above all as honing critical thinking skills. That’s why so many of you are keen about reading and participating in comments, in addition to enjoying the often witty repartee and cooking tips.
Naked Capitalism has long straddled a position few can occupy, providing both hot takes and near think tank-level analysis. A few of many recent examples: Jerri-Lynn on the opioid settlements; Lambert on Biden’s speech on vaccine mandates; and Nick on Mexico enforcing a ban on GMO imports.
We’d like to do more. We’d like to do it even better. Imagine how much trouble we could cause if we ever got our hands on some real money!
Please support our efforts. Give whatever you can, whether it’s $5, $50, or $5,000, via our Tip Jar. Even a small donation helps us meet our fundraising goals. If you are one of the winners in this two-tier Covid economy, please give generously, particularly on behalf of loyal readers who are under stress and aren’t able to donate as much as they’d like to.
And if you aren’t able to make a financial contribution, rest assured there are other ways to help! More than ever, we depend on all of you to promote Naked Capitalism and bring in more readers. You can help by sending articles, Links, and Water Cooler to potentially receptive friends, family members, and colleagues, by linking to our posts on Facebook, Twitter, and other social media, talking up the site, making comments and sending cute animal photos.
In our accompanying kickoff post, we what your donations will fund and will tell you when we’ve hit each of these monetary goals. Our first goal is $21,000 for digital infrastructure essentials. That may not sound very sexy, but this is our plumbing. When your plumbing is not working, I bet you notice! We’ve increased it from last year because we have a backlog and need to find a new host (we are the only client of our terrific host Keith, and he’s decided to exit). We’ve gotten nowhere because we have some demanding criteria and we’ve also been spoiled.
We particularly like checks! And that should make those of you allergic to PayPal happy. You can give via check made out to “Aurora Advisors Incorporated,” sent to:
Aurora Advisors Incorporated
164 Peachtree Circle
Mountain Brook, AL 35213
Please be sure to let us know if you have sent a check so we can include your contribution in our fundraiser tally. Please send an e-mail with the subject line, “Check is in the mail” with the $ amount, to email@example.com. Be warned that it may take a while to deposit them between the state of the postal service and my liking to deposit big batches of checks in person (and our bank is not local). I hope any delay in depositing your generous checks does not mess up your bookkeeping.
You can also use the Tip Jar to donate by credit card, debit card, or PayPal. Please note PayPal allows you to use your regular credit or debit card.
We also want to warn you: as much as we feel very guilty about it, we lack the capacity to thank donors individually. Or to put it another way, with our thin staffing, we’d have to cut way back on posting to be able to do that. We hope you forgive us for having to give top priority to continuing to generate the content you appreciate so much.
Again, we hope you’ll support our work in ways big and small. You’ve helped us build a community, and with your continued backing, we aspire to make it even better in the coming year.