The Double Helix of Entwined Pandemic and Economic Strategy

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by Alastair Crooke, Strategic Culture:

The corollary to the collapse of the technocratic initiative to liquify the over-leveraged economy might well be recession, Alastair Crooke writes.

Three years ago, I said to an American Professor from the U.S. Army War College in Washington, in respect to the campaign to return American lost Blue Collar jobs to Asia, that these jobs would never return. They were gone for good.

He retorted that that was precisely so, but I was missing the point, he said. America did not expect, or want, the majority of those humdrum manufacturing jobs back. They should stay in Asia. The Élites, he said, wanted only the commanding heights of Tech. They wanted the intellectual property, the protocols, the metrics, the regulatory framework that would allow America to define and expand across the next two decades of global technological evolution.

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The real dilemma however, he said was, “What is to be done with the 20% of the American workforce that would be no longer needed: that was no longer necessary to the functioning of a tech-led U.S. economy?”

In fact, what the Professor said was but one facet of a fundamental economic dilemma. From the seventies and eighties onwards, U.S. corporations were busy offshoring their labour costs to Asia. Partly, this was to cut costs and increase profitability (which it did) – but it also represented something deeper.

From the outset, the U.S. has been an expansionary empire ever digesting new lands, new peoples, and their human and material resources. Forward motion, the continuous military, commercial, and cultural expansion became the lifeblood of Wall Street and of its foreign polity. For, absent this relentless expansion, the civic bonds of American unity fall into question. An America not in motion is not America. This forms the very essence of U.S. leitkultur.

Yet it only added further to the dilemma highlighted by my friend above. The expansion was accompanied by a flood of Wall Street credit expansion across the globe. The debt burden exploded, and has become top heavy, balancing unsteadily on a pinhead of genuine underlying collateral.

It is only now – for the first time since WW2 – that this relentless U.S. strategic expansionary impulse has been challenged by the Russia-China axis. They have declared ‘enough’.

Yet, there was always another side to this dynamic of western structural transition. Its foundations, as the Professor suggested, no longer lay with the socially necessary labour contained in manufacturing drab products such as cars, telephones, or toothpaste. But rather, the core of it largely has come to reside in highly flammable debt-leveraged speculations on financial assets like stocks, bonds, futures, and especially derivatives, whose value is securitised indefinitely. In this context, the 20% (or more likely 40%) of the workforce, simply becomes redundant to this highly complex, hyper-financialised, networked economy.

So, here we have the second dilemma: Whilst the structural shrinking of the work-based economy inflates the financial sector, the latter’s complex volatility can only be contained through a logic of perpetual monetary doping (perpetual liquidity injections), justified by global emergencies, requiring ever greater stimulus.

How to face this dilemma? Well, there’s no going back. That’s not an option.

In this context, the Pandemic regimen becomes symptom of a world so far removed from any real economic self-sufficiency – adequate to sustain its existing workforce – that the dilemma may only be resolved (in the view of the élites) through facilitating the continuing attenuation of the old economy, whilst financial assets must be replenished with regular additions of liquidity.

How to manage it? With the gradual abolishing of the traditional labour content to commodities (either from automation, or off-shoring), corporations have used the woke ideology to reinvent themselves. No longer do they produce just ‘things’ – they manufacture social output. They are stakeholders in society, ‘manufacturing’ socially desirable outcomes: diversity, social inclusivity, gender balance and climate responsible governance. Already, this transition has produced a cornucopia of new ESG liquidity flowing through calcified economic arteries.

And the Pandemic, of course, justifies the monetary stimulus, whilst the follow-on climate ‘health’ emergency is prepared in order to legitimise further debt expansion, for the future.

Financial analyst Mauro Bottarelli summarised the logic of this as follows: “A state of semi-permanent health emergency is preferable to a vertical market crash that would turn the memory of 2008 into a walk in the park.”

Professor of Critical Theory and Italian at Cardiff University, Fabio Vighi, has noted too the “Incurability” of what he calls “the Central Banker’s Long-Covid” condition” – that the injection of such a huge monetary stimulus as we have seen, was only possible by turning the engine of Main Street ‘off’, as such a cascade of liquidity ($6 Trillion) could not be allowed to flow willy-nilly into the Main Street economy (in the view of the Central Bankers), as this would cause an inflationary tsunami à la Weimar Republic. Rather, its’ main thrust has served to further inflate the virtual world of ever more complex financial instruments.

Inevitably however, coupled with supply-chain bottlenecks, the gush of liquidity has caused Main Street inflation to rise, and hence imposed further hurt on the ground. The aim of managing the manufacturing attenuation on the one hand (small business ‘lockdown’), whilst liquidity flowed freely to the financialised sphere (to postpone a market crash) has failed. Inflation is accelerating, interest rates will rise, and this will bring adverse social and political consequences in its wake: i.e. anger, rather than compliance.

At the heart of the predicament for those who run the system is that, should they to lose control of liquidity creation – either as a result of interest rate rises, or from increasing political dissent – the ensuing recession would take-down the entire socio-economic fabric below.

And any severe recession would likely wreak havoc on the western political leadership, too.

They have opted therefore instead, to sacrifice the democratic framework, in order to roll out a monetary regime rooted in a cult of corporate-owned science & technology, media propaganda, and disaster narratives – as the means to progress towards a technocratic ‘aristocratic’ takeover over the heads of the people. (Yes, in certain ‘circles’, it is thought of as a newly rising aristocracy of money).

Professor Vighi again:

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