Is Capitalism Amoral Or Immoral?

It was fashionable (and desirable) until the mid-80s to question how well capitalism worked as a basis for running society. Then the social “greed is good” changes brought about by the Reagan/Thatcher revolution began to take hold of the Western (or at least the Anglo-Saxon) psyche, and it became a form of sacrilege to question the magic power of the free market to fix any problem, anywhere. That superstition gradually became established fact – until, of course, the system began to show its deep flaws in 2008.

Saturday’s Guardian carries a comment article from Tim Montgomerie (editor at the ConservativeHome web site) titled Capitalism is amoral – we’re our own worst enemy. The piece tries to make the case that the ills of recent years have been caused by “extraordinary government activism”, not by out-of-control markets. However, the examples supplied are weak – the author seems to accept, for example, that the main problem with Obama’s $787bn stimulus is that it was too small, given the scale of the crash. Another example given is the Iraq War, seeming to forget the huge profit motive of the oil, arms and reconstruction industries to make that senseless war happen.

But let’s challenge the core assertion, one that is so often repeated without challenge: Montgomerie repeats the popular idea that “Capitalism is not immoral but amoral. It does what its users demand of it”. Is that true? Does the profit motive always work for consumers? Montgomerie gives food and transport as examples, so let’s examine these industries: amoral or immoral?

Food Industry

It’s true that competition has given us more food choices that ever before. That applies to the wealthier parts of society, at least. In young markets, competition creates an explosion of choice, which is certainly a good thing. But once corporations became established in the food industry, strategies changed. Choice is just one way to attract a customer base, but there’s an easier way: make your customer dependent on your product. This is where the needs of the market and the needs of the consumer diverge. Humans are designed to seek out rare ingredients that we need. Meat fat was such a rarity in pre-history (before hunting tools were developed) that we find it highly attractive and addictive. Refined sugar is an addictive drug, only discovered in recent centuries. Salt is a generally rare and necessary substance that, again, we have a natural addiction to. So in the amoral world of the market, it makes sense to add increasing amounts of these ingredients to food, not because users are demanding them, but because profitability naturally rises as a result.

So far, as suggested by Tim Montgomerie, this is amoral behaviour, not immoral. No harm is intended. The next stage is this: scientific researchers (state-funded usually) begin to notice that people are getting fatter; that tooth decay is increasing; that diabetes and other diseases are rocketing. This information starts to spread to the consumer. It’s at this stage that markets lose their claim for amorality. The food industry now has three options:

Moral: listen to researchers and make food healthier, even if that hurts profits.

Amoral: continue to address the evolving desires of the market as consumer demand dictates. Of course, this does happen, but as the history of the food industry suggests, it’s far cheaper (and thus more profitable) to use healthy-sounding language than it is to take addictive substances out of your products.

Immoral: begin propaganda operations to counteract scientific research that might hurt profits. Most markets end up here. Once you have a consumer base hooked on your product, the logic of profit is remorseless: attack anyone or anything that threatens your bottom line.

In a young market, amorality (following consumer needs) is the way to go; but in mature market, the immoral choice is often the most profitable. Rather than simply track consumer demands, it’s more profitable to control them. Many examples can be found of immoral behaviour by the food industry in pursuit of profits: in the US, private corporations have often won contracts to supply schools with food and drink. The result is a fall in the quality of food eaten by children. Now they can get consumers addicted to junk ever younger, and resist the pressure to educate children about food and health, thus crushing future consumer demands for better food. In a perfect example of market immorality, in 1998 Oprah Winfrey ran a show exposing the appalling way the American beef industry was rearing cattle. The amoral response would have been to track any change in consumer attitudes, and change production techniques; but that would be hugely expensive. Far cheaper to shoot the messenger, as Oprah found to her cost. She immediately lost advertising and faced action, both legal and propaganda to discredit her. She backtracked quickly, providing a non-critical “interview” with a beef industry rep. to “set the record straight” (i.e. lie without interference). Examples like this are legion: the food industry will viciously attack anyone that questions the health of its products (remember McLibel?)

Transport Industry

We can apply the same approach to transport. Mass transit (when not starved of investment), offers the fastest, cheapest and most fuel-efficient way to carry large numbers of people and goods. From the 1940s, the car provided an alternative that was more glamorous but slow, expensive and fuel-hungry. Sure, people desired cars, but they wouldn’t trash superior transport systems for an inferior one. Given that cities only had the space for a fraction of their population to use cars, would people destroy their environments just to own cars?

Enter the car mafia, comprising several industries: car manufacturers, tyre manufacturers, road builders, and of course, oil producers. Car transport requires far more resources than rail, trams and buses: huge, multi-lane highways which require vast amounts of space. More space still needed for parking (most private cars spend most of their lives wastefully parked). And most important of all, cars burn far more fuel than mass transit to move the same numbers of people. Would consumers abandon cheap, fast transport for slow, expensive transport? Of course not; but they were never given the choice.

The car mafia set about destroying mass transit, which they could never have competed against in a free market. Across the US, between 1936 and 1950, mass transit systems vanished as the car mafia went into action, destroying electric transport infrastructure. History tells us how happy post-war consumers jumped at the chance to own cars, and that’s undoubtedly true; less is said about the abolition of transport choice. Free market fundamentalists claim markets create choice, but the opposite is often true.

In the UK, the world’s greatest rail system was cut to pieces; between 1950 and 1975, the railways were slashed from 21,000 miles to 12,000. The most significant steps were taken in the 1960s by Dr Richard Beeching, Chairman of British Railways. Beaching was encouraged to cut the railways by Ernest Marples, the Conservative Transport Minister. Marples also happened to be a major shareholder in a construction company that made huge amounts of money from motorway construction. This story is an important part of modern British history, and the name Ernest Marples should be remembered as one of Britain’s best known crooks. But the car mafia, and their tame media, have ensured the British people have forgotten what happened to our transport system

The transport market has failed; we make ever slower journeys for ever higher cost, and most people use the car not by choice, but because choice was taken away to increase profits.

And The Rest

Given the choice of being amoral and following consumer needs, or immoral and crushing competition, the car mafia did what any market does: follow profit at any cost to society. The consumer doesn’t lead; he takes what corporations offer, which is often the most inefficient and expensive (and hence profitable) option. Markets do work, when they’re young and genuinely competitive, but that is a temporary phase. Endless examples can be found of market immorality: the Iraq War was fought so that the US taxpayer could be fleeced of $trillions by US corporations; the millions spent on climate change denial have shored up billions in oil industry profits; the tobacco industry likewise denied the cancer link for decades after the evidence was available.

Markets are good at creating and incubating fresh ideas and new technology. They liberate individuals and societies from bureaucracy and make societies more creative. But this is always a temporary effect. Established markets will support literally anything – murder, slavery, war – to hold on to their privileged positions. So Tim Montgomerie and other “markets are amoral” fundamentalists are disingenuous, only telling half the story. Markets are immoral; only a strong, well-funded democratic state can hope to keep them in check.

The British Government’s Moronic Oil Love

Last week’s budget by Chancellor George Osborne was unlikely to contain much good news, given the ongoing cuts; but right-wing newspapers did their best to find some anyway. The headline-grabber was an action to “help the motorist”, possibly not the constituency most in need of help, but certainly the moaniest. “TAX ON OIL FIRMS TO HELP DRIVERS” screamed the loyally Conservative London Evening Standard (full, grovelling story here), perhaps the publication most desperate to prop up Tory support, given the proximity of next year’s mayoral elections, and the apparently precarious position of London’s right-wing (and car-loving) Mayor, Boris Johnson.

The story was a gushing tribute to Osborne’s “massive tax raid” on oil companies (actually, the £2 billion is roughly one month’s profit for BP alone). But the key point is missed entirely – given that this money will be used to reduce petrol costs at the pump, it ends up being taken from the oil companies… and in large part fed straight back to them by subsidising their own product. Oh! The pain!

Hence a government subsidy to maintain the British addiction to oil is spun by the Conservatives (and more importantly their media friends) as a victory for the little man over the beastly oil giants. And yet the oil industry will have been cracking open vintage bubbly on the announcement: not only have train and bus fares continued to rise above inflation, bolstering car usage, but the government has proved itself hostile to oil alternatives such as solar, as I wrote here last month. Rocketing crude oil prices have pushed oil profits to record levels. And on top of all this, a 2p-per-litre government subsidy to petrol. This is a great time for the UK oil industry.

The rest of us should be more worried: peak oil warnings become ever louder (though apparently the cries haven’t yet reached the ears of George Osborne) and our military seems exclusively and expensively to be used for the protection of British energy supplies. The next great depression will dawn when oil production can no longer keep track of global demand, and those nations that have made a concerted investment in weaning themselves off the stuff have a chance of emerging as the next world leaders. The US is apparently intent on hitting the wall at full speed – and it seems, so is our own moron government.

Fuel Price Morons

Every day now, my timeline is filled with howls of rage from both sides of the Atlantic about the high cost of gas/petrol. There are some local differences: US screams tend to be louder, reflecting their greater exposure to crude oil prices, and they tend to blame Obama for the global price rises, believing (incorrectly) that more drilling at home will fix the problem (search for the #DrillHereDrillNow Twitter hashtag to see some real-time stupidity). British morons are generally more aware of the global nature of oil pricing, so instead they turn their rage on government-imposed fuel duties. Both sides miss the key points: that rising global oil prices are outside the control of any individual or nation; that more US-based drilling will at best slow down the rise while wrecking the environment; that addiction to oil won’t be cured by further addiction; and that Europe has actually avoided the worst of oil addiction by imposing high fuel duty (although our price-per-gallon is much higher, our overall spend on fuel isn’t because we use less).

I used to love driving; I loved my car, and drove it as stupidly as a typical 19 year old wannabe racing driver could do. Then, I found a great job – the only downside being that I had a minimum 80 miles per day commute (much more if I had meetings outside the office). The cost wasn’t an issue for me; my employment package included a company car and fully-expensed fuel; but my minimum of 2.5 hours a day in the car soon started eating away at my enjoyment of driving. Despite the fact that most of my commute was on motorways with a speed limit of 70mph, my average speed was around 25mph, and lower if there had been a serious accident.

Day after day, I sat on the M25 (London’s massive ring road, often referred to as “The World’s Biggest Car Park” and subject of the Chris Rea song, Road To Hell), and pondered the wisdom of Britain’s long-term shift from rail to road. I was surrounded by thousands of other people, mostly sitting alone in their own metal boxes, all facing in the same direction, all burning fuel in their own personal engines, and moving very, very slowly.

It slowly became obvious to me that this wasn’t sustainable, either for me personally or for the country. However many lanes were added to the M25, the traffic never sped up significantly – more cars simply arrived to fill the new space. Car ownership and mileage were growing constantly. People were abandoning urban life for the suburban dream. It was clearly impossible to fit cars into a human-sized town or city; the space has to expand to cater for all the cars, whether moving or parked. Car addicts were being offered American-style shopping malls in the middle of nowhere, and town centres were beginning to wither and die as commercial places. And this was long before I first heard about Peak Oil – the (in hindsight) obvious idea that if we keep using more fuel, one day we won’t be able to get it out of the ground quickly enough to serve demand.

My long hours spent behind the wheel took their toll, and I developed back problems and asthma. I grew to hate the car, and became jealous of people who didn’t have to drive to work. Changing to a job where I had to buy my own car made the problem worse. Eventually I moved to a London-based job, sold my car, bought a new bicycle and moved home close to good public transport. On a conservative estimate, I saved £5,000 ($8,000 at today’s rate) a year, my weight fell, my health improved and so did my quality of life.

After 9/11, Osama bin Laden was very clear about his strategy to undermine American power in the Middle East: provoke US revenge attacks, create instability and drive oil prices up to $200 a barrel, thus destroying America’s oil-addicted economy. The 2000 Bush election win had been an effective coup for the oil industry; in the 2003 invasion of Iraq, Bush and the neocons did what bin Laden had invited them to do, and the seeds were sown for a disastrous end-game of rising demand and unstable supply.

The oil industry is doing what it needs to do: convince us to keep using its product. It does so by lying about the risks of our continued addiction, by denying that peak oil is near, by overstating oil reserves, and by continually lobbying against any new energy source or form of transport that may threaten sales. In 2000, it even installed its own oil-friendly regime in the White House in order to preserve its revenues for another eight years. A Saudi oil minister, aware of the threat to his nation’s future if the world turned its back on oil, is quoted as saying: “The Stone Age didn’t end for lack of stone, and the oil age will end long before the world runs out of oil.”

Smart individuals can act in their own interests – primarily by abandoning car-based, suburban living. We need to appreciate that destroying more nature for a little more oil won’t change anything; and Europeans should understand that high fuel duty is what has saved us from an even worse disaster to come as oil prices keep rising. We’re driving ourselves fast towards a cliff. We need to stop moaning and start steering.

Nationally and internationally, change is much harder to execute; America in particular is so far down the route of de-urbanisation that it would take decades of concerted leadership to move society back to a high-density, low-energy style of living. And while the oil industry retains its political power, and pumps its anti-peak-oil, anti-climate-change propaganda via outlets like Fox News, this can’t even begin to happen.

Those morons who continue to ignore the obvious deserve their looming fate: suburbia and exurbia will become the new ghettos and ghost towns as their oil-based lifelines to civilisation shrivel away. They can tweet their hatred of Obama forever, but it’s the oil industry, its conservative friends, and our blind acceptance of their lies, that got us to this point.

Moron Alphabet: H-J

(This is the second in a series. Click for part one, Moron Alphabet A-G)

H is for High Speed Rail

A while back, I was staying in New York and had to travel for a meeting in Washington. The train is my favourite mode of transport, so I decided to travel that way, rather than fly or rent a car. The ticket wasn’t cheap, but the carriage was very comfortable, and almost empty. We passed through some nice scenery, and I got a chance to read, but I was surprised how slowly we travelled. A journey of about 200 miles took four hours each way.

Trains have been with us for about 200 years, and revolutionised transport – first in Britain, then around the world. America’s railroad system, in its day, changed the face of America forever, and was the world’s most advanced; but as oil and car companies became more powerful, they lobbied for governments to invest in freeways rather than rail, and rail investment, particularly in the US but also in the UK, was sidelined. While Japan, mainland Europe and eventually even the UK and China invested in faster, more efficient rail technology, US transport has become slower and more expensive in recent decades. Sitting in traffic jams has become a way of life – and of course innovation has come to the aid of the motorist; in the form of more comfortable seats, better music systems, and drive-thru restaurants. But no actual solution to reducing journey times.

In France meanwhile, trains have run at up to 357mph (in test conditions) and can complete scheduled journeys at average speeds of up to 173mph. Modern electric trains use far less energy per passenger/mile than cars. So switching people and goods from road to rail, especially as oil prices rise, should be a no-brainer, right?

Sadly the oil industry doesn’t see it that way, for obvious reasons. And since Congress is so generously supported by oil “donations”, Congressmen don’t see it that way either. So American cities grind to a halt, and people flee to Exurbia (aka the-middle-of-nowhere) to escape traffic and air pollution.

Finally, America has a President who values rail, and seeks to invest an initial $53bn. Which predictably has morons screaming about the outrageous cost (with encouragement of course from the pro-oil media).

So let’s look at some numbers: America uses about 21m barrels of oil daily, of which 45% is used to run cars. At a price of $87.11 per barrel, that costs $1,829,310,000 a day, or $667,698,150,000 a year – well over ten times the amount proposed for investment high-speed rail. Now you add hidden costs: oil wars, “aid” given to Middle Eastern states, terrorism generated by support for Middle Eastern dictatorships (and resulting homeland security costs), the cost of damage from oil spills, the health care costs of air pollution from cars, the economic hit of slow journeys and many other factors – not to mention climate change, which has huge costs of its own. Economically, it’s insane not to invest $billions, even $trillions in modern rail technology.

Like I said, it’s a no-brainer; however, brains seem to be in short supply in government.

I is for The Iraq War

Perhaps this subject’s been done-to-death… but given some of the discussions I have on Twitter, it seems the facts still haven’t sunk in yet. So here’s an eight-point quick summary of known-knowns, just as a refresher.

  1. Saddam was certainly an asshole. He was America’s asshole.
  2. Saddam’s chemical weapons were partly supplied by his good friend and ally: Ronald Reagan (with Donald Rumsfeld assisting).
  3. From 1991 to 1998, UN weapons inspectors spent years finding and removing WMDs from Iraq. They were confident that all significant capacity was gone by 1998.
  4. In 2002, as the Bush administration tried to build the WMD case, the chief UN inspector Scott Ritter (a Republican who’d voted for Bush), pointed out that the WMD case was fabricated. And if he didn’t know about Iraq’s WMDs, who did?
  5. In November 2002, the UN inspectors returned to Iraq. They toured all known sites for several weeks and found nothing of significance. In response to US claims that they have “intelligence” of WMDs existing, they asked the US for the locations they should inspect, and were refused this information. This is the single most compelling evidence that Bush/Blair had already decided to go to war, and that the WMD claim was false.
  6. Robin Cook, UK government minister who (as former Foreign Minister) had access to secret intelligence, resigned over the war on 18 March 2003. His resignation speech (12 min video) summarises well the reasons why the war was unjustified.
  7. Ultimately, Bush’s “coalition of the willing” comprised one true partner: the UK. And the UK was led to war against the will of the population by Tony Blair – which ultimately led to the end of his political career. The only population involved that backed the war was the US (Israel was also reportedly on-side, but they’re guaranteed to support any action that involves killing Arabs).
  8. Long-term damage from the war is widespread and ongoing. The most conservative estimate of war-related deaths comes from Iraq Body Count, with a low estimate of at least 99,711 Iraqi lives lost. Iraq’s infrastructure is still not at the level it was pre-war. The financial cost was huge; the cost to American and British standing in the Middle East was also large, at a time when China needs oil and is making new friends around the world.

J is for Judgement Day

Having created us all (some time between 6,000 to 12,000 years ago), God sat back and watched us fuck up. From time to time he gave us a little guidance, usually in the form of killing everything that moved. Having obviously received some kind of anger-management therapy, God later sent his son Jesus to guide us. For someone whose Father was best known for flying into genocidal rages, Jesus turned out to be a Really Nice Bloke. Sadly, the Romans didn’t appreciate nice blokes, so they killed him. But the Bible is pretty clear that Jesus will return, and this time his coming will herald Judgement Day. Strange as it may seem, the entirety of history turns out to be a very difficult test, and Judgement Day is when we get our results.

In the light of modern science, this seems unlikely to many of us. Luckily, God foresaw our skepticism, and so he created the Bible Belt to keep his word alive. Thanks to the good Evangelists of the Southern US, we know that sometime soon, believers will float up naked into the sky, and then Jesus will return (there seems to be disagreement about the timing of this – it could take up to seven more years), at which point the Last Judgement will take place.

Given that Evangelical Christians have spent their time abstaining from sex and listening to crappy music in readiness for the Rapture, it’s understandable that they’re impatient for this to happen, so it’s unsurprising that predictions of the End Of Days come frequently. Enter Harold Camping, an 89 year-old Christian radio broadcaster, who is predicting the second coming will take place on 21st May 2011. His web site makes for entertaining reading, and he appears to have at least some followers. So pencil 21 May into your diaries – we’ll catch up on 22nd to review progress.

See also:
Moron Alphabet A-G
Moron Alphabet K-M