Given the obvious problems we have outlined so far why would governments, corporations and even scholars approve predatory economics, a colonial economy and even the global economy? Can no-one see the damage they do?
Some of them must see it but, if so, they go ahead anyway. That's an example of "the tragedy of the commons."
Traditional English villages had a field called the "commons" where villagers were free to graze sheep or cattle. The capacity of the field was limited but there was no way to limit the grazing rights of any individual villager.
If the field was over-grazed all would lose, but if any one villager reduced the number of his animals on the field he would lose personally. Because each individual stood to gain by grazing as many animals as possible for as long as the field lasted, many commons were over-grazed and ruined.
In the modern version of the problem it makes sense for self-centered individuals and corporations to support anything that promises them a personal profit. Even if they know that their choice will harm or possibly even destroy the nation they can rationalize a belief that they could not prevent it anyway, so they might as well profit by it.
We see examples of that when tobacco companies insist that cigarettes cause no health problems and when oil companies pretend that burning fuel does not contribute to global warming, the destruction of the ozone layer or other problems.
A lawyer may know that the suit he prepares is unjust and that it will cause harm to innocent parties or to the economy, but he also knows that he will be well paid for his work. A politician may know that the policy he proposes will do harm to the country, but he also knows that it will help the commercial interests that pay for his election campaigns and who may contribute to his retirement fund. An oil-company executive may see the need to reduce our consumption of oil, but he will still work to increase it.
If any of these people think about the future they can tell themselves that if they make enough money now they will be able to survive the consequences later, whatever those consequences may be. Even some people who do not contribute to problems have formed "survivalist" communities in which they hope to live through an apocalypse. For a self-centered person, it makes sense to do whatever it takes to make enough money to survive.
That should be no surprise, because co-operation among males is a relatively recent evolutionary development. The one thing that most male animals have in common is that they don't cooperate with each other.
A pride of lions usually consists of one male, several females and some cubs fathered by the male. When another male takes over the pride he kills all the old male's cubs. When a male cub grows up, it is driven out of the pride.
Occasionally two or three young males may team up to drive an older male away from his pride, but the coalition lasts only until one of the members becomes strong enough to drive the others away.
Many herds of grazing animals consist of one herd bull, his females and their young. Younger bulls may be tolerated, but only on condition that they don't act like bulls.
But human males co-operate. We can only guess at the reason but we can be fairly certain of our guesses. Over time all types of behavior appear, and the ones that work best survive because the animals or people who adopt that type of behavior survive and breed. They don't have to understand what they are doing; they just do it and live or die by their actions.
At some point in our evolution humans learned to co-operate. Like some other animals they learned that if they travelled in groups they were less vulnerable to predators. Later they learned that if they hunted in groups, they could become predators themselves. Other animals did the same.
But even as men live and work together they still compete. In primeval communities we competed with other males for mates and for prestige and position within the band. When we co-operated with the men of our own band it may have been in competition against males of other bands for territory, hunting rights or other advantages.
Most of the competition is formalized now but the roots are still there. When I meet a man of my own band I see a potential rival, and when I meet one from another band I see a potential enemy.
I don't consciously think that way because I am "civilized" but under the veneer of civilization, I still have instincts. I can control them, but they are a force to be reckoned with.
The civilization that helps me control my instincts is supported by a network of traditions and laws that have evolved over thousands of years and are still changing. The balance is changing too, from rule by tradition to rule by law.
Families don't need laws because they are ruled by common interest. They have a genetic bond, and all members of a family are concerned with the welfare of the whole family. Among clans or extended families some members will rank higher than others, but all will be taken care of. Any male who is not part of the family is an outsider, and he is protected only by his own strength and by the threat that his family may retaliate if he is harmed.
Bonds between members of a band are weaker than the bonds within a family but most of the members of a small band are relatives and/or friends, and each person still feels personal responsibility toward every other person in the band.
At this level they are ruled by custom or tradition, which is derived from the way members of the family treated each other. Custom, tradition or religion may also protect strangers but the males of the village still see each other as potential rivals, and a strange male as a potential enemy.
LAW AND TRADITION
At some stage decisions about who or what is right or wrong are delegated to a chieftain, priest or judge. Because such a person has significant prestige, his decisions become law.
Each judge has authority of his own but in practice each one has served as an apprentice judge for a long time, and an apprentice learns to respect the wisdom of his elders. Eventually the apprentice becomes a master but, after years of deferring to the decisions of his elders, he may not find it easy to change.
If today's judges were raised to respect the judges of their youth the idea of "precedent" will develop. As the weight of decisions builds up we have a body of common law which still rules most cases in England and, to a lesser extent, other parts of the world. The common law is derived from tradition but whereas tradition is enforced by the people as a whole, law is enforced by rulers.
That's an important difference because I must seek the approval of my family and friends and, by extension, other members of my culture, but I may not seek the approval of my rulers. If I am one of a conquered race -- an English Saxon, perhaps, in the days after the Norman conquest -- I may hate my rulers and while I may toady to them I may also try to kill them if I get the chance.
In a large society I have no ties of family or long friendship with most of the other members of my society, and in a mixed-race society I may see some of them as positively alien. If my rulers belong to another race or another religion, I may see them as oppressors.
Even when the rulers are members of my own race or band I may resent them, because they take part of my living and they themselves live much better than I do. In a so-called democracy I may resent both my elected representatives and hired civil servants, because I see them wasting my money and paying themselves more out of my work than I make myself.
So even with common law there is a major distinction between rule by tradition and rule by law. Tradition is what my family and friends expect and, as a member of society, I must comply. Law is what my rulers expect and if I don't respect my rulers I will not respect their laws, however wise and just they may be.
When law replaces custom the concepts of "right" and "not right" are replaced by "legal" and "not legal." That's an important difference because while I may feel bound to avoid behavior which is "not right," I feel only the need to avoid getting caught at behavior that is "not legal." That feeling will be reinforced if, as is often the case, I see members of the elite getting away with behavior that I know is "not right" and that may be "not legal."
And when people are "caught" and "punished" for crime, the punishment is very selective. In 1997 the average take in an armed robbery in Toronto was $3,000 and the average sentence for a convicted armed robber was five years. The average take in a fraud was $17,000, but, according to Metro Toronto Police fraud squad officer Wolfgang Lott, quoted in the Sunday Sun, May 1897, most people convicted of fraud were not sent to jail.[1]
The disparity is obvious and so is the reason. Fraud is the kind of crime a lawyer might commit. Crimes are tried in courts run by lawyers, presided over by judges who are also lawyers. Because they know that most frauds are perpetrated by people very much like themselves, lawyers can empathize with the perpetrator of a fraud. They feel no empathy for an armed robber, and they fear him.
Lawyers would probably offer a different rationale. They might say that armed robbery represents a greater threat to society than fraud. That may be, if you consider only the sectors of society that are more vulnerable to armed robbery than to fraud. On the other hand fraud is more likely than armed robbery to victimize people who can not afford the loss. Further, because we know that the law winks at fraud; we do not respect the law.
Lawyers themselves say the rule of law is preferable to the rule of tradition and well they might, because the difference is very profitable for them. We all know what is "right" and "wrong" and when rule is by tradition, there is little room for argument. If you take something that is not yours, or if you take unfair advantage of someone, you are "wrong."
But "legal" and "not legal" are something else. Under the rule of law our courts are not interested in "justice," only in "the law." In this system a lawyer who can find a loop-hole can literally help his client get away with murder. In civil litigation the only safe assumption is that, whatever the facts, the richer party will win.
On the other hand if a lawyer really believes that the important distinction is between "legal" and "not legal," he need not worry about the distinction between "right" and "not right."
People who abuse the law and the lawyers who help them do it both know that they harm society but, like English villagers who grazed too many cattle and sheep on the commons, they believe that they as individuals gain more than they lose.
And in any individual case that is probably correct. In a society of people who work for the common good, the individual who works only for himself will profit. Unfortunately the rule of law favors a society in which most people work for private profit at any cost.
If the best way to make a profit is to be a predator, many people will be predators. If there is profit to be made in propaganda-based businesses, people will pursue those businesses. If there are profits to be made in a global economy, some people will work to create a global economy. Because our economy believes in numbers rather than in human values people who work only for personal profit will, on average, have more power than those who honor human values.
This is not an argument for socialism because we have ample proof that socialism does not work. It could lead to an argument for social responsibility but I won't follow it here because at this point I am trying to analyze a problem, not solve it.
It would take more than a single book to describe the whole of our problem, but we have looked at some of the more important factors. Let's run over them again, in a quick review.
A REVIEW
Our most important single economic problem is that a lot of people don't see the problem. They're doing well enough themselves and they would rather not think about the beggars on the sidewalks, the people who live in the parks and the working poor who depend on food banks.
They can't see the problems because they believe the numbers, but the numbers are cooked. The Gross Domestic Product does not tell us anything about the financial welfare of the nation and the unemployment figures don't tell us how many people are out of work.
Our official numbers do not distinguish between cost goods and benefit goods. This distinction is vital, and any valid accounting system must consider them separately.
The value of money is created by the goods and services that it represents and it can have no more value than those goods and services. Because of that, some dollars are more valuable to the economy than others.
Root dollars, created by the production of benefit goods, are valuable. Derived dollars, which are created by the cascade as root dollars pass through the system, have the same exchange value as root dollars but they are less valuable to the system.
Imagined dollars are created when banks make loans. If they are used to create new capital goods they are as valid as the goods they pay for, but imagined dollars that are created to buy existing capital goods dilute the value of all other money in circulation.
Money is multiplied by two separate mechanisms, the multiplier and the cascade. The multiplier is a side-effect of the production of benefit goods and it creates root dollars. The cascade is a side-effect of the distribution of wealth, and it creates derived dollars. Both are valid but production, and the multiplier it creates, are the foundation of wealth.
Our economy includes three basic types of activity which we can classify as production, trading and predation. Some types of predatory activity are illegal but others are legal, and some are based on the law. Most speculation and some of the activities of businessmen and lawyers are predatory activities, which can be compared to the piracy and highway robbery of an earlier era.
The first banks supported development, but most of the activities of modern Canadian banks are predatory. Because banks can create their own money they don't have to pay interest on savings, and they drive Canadians to invest in mutual funds. These funds can maximize their own profits by supporting and encouraging the destruction of existing businesses.
Some lawyers try to protect the public but even they profit from the activities of courtroom bandits who have destroyed major corporations in the United States, and who increase costs for all of us. Courts of law help them in their predation, because the courts serve the lawyers rather than the public.
We have been taught that education will improve our lives, but that's an illusion. Many of our economic problems stem from a shortage of practical training, and we actually have a higher percentage of university graduates than wealthier, and better developed countries. Our universities serve themselves very well, but they do not serve the country.
The women's movement encourages women to produce cost goods in offices rather then benefit goods in their homes. The result is good for the Numbers Game, but a cost to the economy.
Many of our problems date from colonial times, and from the fact that we still maintain a colonial type of economy. As a colony we depend on "foreign trade," and we can't get along without the help of more developed nations. This is a potential problem because some of the resources on which our economy is based are already depleted or un-saleable, and we will soon run out of others.
We developed an industrial base in the First and Second World Wars, but our governments allowed it to waste away. Now most of our industry is branch plants, and many of our so-called "industrial exports" are actually re-exports of goods that were made in another country and assembled in Canada.
Canadian Confederation was planned for Britain's benefit. Now it benefits our federal and provincial governments and a few very big companies, but it is a cost and a detriment to most Canadians. The system in which a central government collects most of the taxes for distribution to local governments encourages waste and mismanagement. Our federal government is by far the biggest expense for Canadians but, for most of us, it produces very little benefit.
Both the federal and Quebec provincial governments gain from Quebec separatism, but most Canadians would be better off if the Francophone sections of Quebec were invited to go their own way.
The global market is a new version of the old colonial system. It destroys the economies of rich and poor countries alike, it sets us up for a global economic melt-down that could bankrupt the whole world and it also contributes to the movement of pest and disease around the world.
The world has always been in danger of plagues like the smallpox that wiped out most of the inhabitants of the Americas after the white man came, the Bubonic plague that wiped out about one third of the population of Europe in the 14th century and the flu that has swept the world many times, and which killed at least 30 million people in 1918 and 1919. Now we are threatened by new and potentially more deadly plagues, and by pests and climate change that could destroy our food crops.
The problems caused by the global economy are obvious but many businesses and governments support it because of the phenomenon commonly known as the "tragedy of the commons." Even if they see that their actions are harmful to others they persist because they reap personal profit from the system.
That's a human failing but some say there is no alternative to the global economy. If the world is going to hell we might say there is nothing that any individual, or even a national government, could do about it.
But that's not so. Granted that a country the size of Canada can have little impact on world affairs we can still conduct our own affairs for the benefit of Canadians, rather than for a foreign elite and, if we do it well, we may serve as an example to others. The end of the world is nigh, but salvation is still possible.
Forward to Where do we go from here?
back to Andy Turnbull's web page