Posted tagged ‘economic collapse’


May 30, 2010

Erle Frayne D. Argonza

Good evening!

The events in the Eurozone are now getting to be more alarming. Forecasters are now claiming that another round of recession is in the offing, as the bubble burst that began in Greece will spread to Spain, Ireland, and other member-states of the EU.

Will liberal capitalism continue to live a life that seems to hang in the balance? Or will capitalism need to restore itself through totalitarian means? What’s so wrong with the system that it just can’t be sustained enough?

Let me share to you past blog writings about the subject: ‘mad economics’ and the ‘demise of liberal capitalism.’

[Philippines, 23 May 2010]


Erle Frayne Argonza

Good afternoon!

At this moment, I’m sipping coffee contained in a pack that is sold for worth P130, or $3.00. The pack is one of the domestic brands of brewed coffee blends, ready for the drip coffee maker, of the Arabica and/or Robusta varieties. In economic parlance, this coffee is a commodity because (a) it was intended for exchange and not for the coffee producer’s consumption alone, and (b) money was used to acquire (purchase) it.

I have such deep fondness for coffee, as I acquired my coffee-drinking behavior as a childhood habit yet. In my hometown of Tuguegarao (city), Cagayan province (North Philippines), coffee beans were grounded into powder form and sold right inside the ‘wet’ market, was brewed using the local decoction techniques, and was consumed by people of all ages from pre-school to senior’s age. That was then, and that was how I learned to drink this beverage at age 5 more or less. I was hooked to the habit since then, even as I continued to drink milk that I still do till now.
Both coffee and milk are among my health formulas, and both are commodities.

The question I’m asking now is, will commodity-based economics survive the times ahead? Both coffee and milk will survive for sure, but will the money economy that underpins them survive as well? As to the broader world system of capitalism, will it survive too or is it in fact on its death knell today?

Capitalism was the last of the world systems that embodied the ‘money economy’ to which it properly belongs. With the opening of the 20th century, the socialist world system appeared on the social landscape and attempted to serve as an alternative to capitalism, but this experienced its early demise as its implementers found out that it cannot be sustained after all. Both capitalism and socialism are embodiments of the ‘money economy’ as it later turned out to be, they are just but two sides of the same coin: the ‘money economy’.

Socialism is gone, and no matter what attempts there may arrive to survive it in some other forms, this variant of the ‘money economy’ is gone. Now capitalism is all alone, and it is getting more real than virtual that it too is bound to crash a catastrophic end, and with its demise, the “last of the (economic) Mojicans” is bound to disappear (my apologies to Mojicans if my note sounds ethnically incorrect). And with capitalism’s demise, the whole of the ‘money economy’ folds up like unto a book that had reached its last chapter, and deserves more to be consigned to the archives of history.

The Frankfurt school thinkers, notably Jurgen Habermas, cogitated that capitalism’s life span was extended somehow, and was dubbed as ‘late’ capitalism in this last phase of the world system. In this phase, state planning and interventionism were infused into the system to extend its life. Before ‘late’ capital came the mercantile, free enterprise, and monopoly phases of this world system. Will there be another phase to capitalism after ‘late’ capital?

Before I answer that extension of life span, let me stress that ‘late’ capitalism shall end in the following process and manner:

· The re-introduction of liberalization—of free market and free trade principles—into ‘late’ capital shifted engagements away from production, the real foundation of the economy, to the sphere of predatory finance, thus producing the gargantuan ‘bubble economy’. The ‘physical economy’ of production transmogrified into the ‘virtual economy’ that produces no real value other than imaginary or delusional values. It is ‘mad economics’ in operation, no longer the ‘rational economics’ of mercantilists, classicists and neo-classicists.

· The ‘mad economics’ led to the yawning gap between actually produced values and the aggregates of financial derivatives and debts combined, to the extent that the former shrinks at a rapid rate relative to the latter. As bubbles burst from one commodity sector to another, leading eventually to a crisis of gargantuan proportion, all the more will production shrink, unable to produce values that can input into the demand functions for fresh money to pay for aggregate credits, primary debts, secondary debt obligations, and so on.

· The crisis will then move on to the further shrinking of production, tightening of credit sources, and hyperinflationary situation in utilities (notably gas & power), food, base metals and other vital commodities. Total economic collapse results from the foregoing.

· The economic collapse then leads to social unrests, turmoil, upheavals, civil wars, food wars, water wars, and possibly intercontinental wars such as another 3rd world war. The clash of world powers and their surrogate emerging markets will become the flames of a possible long war akin to the 30 Years War (c.1618-48).

Let me now end at that instance. Suffice me to proclaim that the death knell of ‘late’ capitalism and the whole of the ‘money economy’ of the last 2000 years or so are ending. The ‘non-cognitive economics’ of the Roman to feudal era, the ‘rational economics’ of the Renaissance to monopoly capital era, and the ‘mad economics’ of ‘late’ capital were markedly the underpinning mediation processes of that entire 2000-year epoch. The epoch and its last phase of capitalism is rapidly drawing to a close.

[Writ 22 August 2008, Quezon City, MetroManila.]


Erle Frayne Argonza

To all fellow men and women out there who may have deep fondness for the liberal capitalist model of economic adaptation, I hope that you can make some adjustments in your cognitive banks. Capitalism is not a permanent facet of human life, but merely one among various epochs that will come to pass. Only impermanence is sacrosanct in the cosmos, so please refrain from singing hallelujah to a world system that is on its death knell as I articulated in a previous article.

And please refrain from swallowing hook-line-&-sinker the contentious propaganda of Francis Fukuyama about the ‘end of history’, that accordingly history had concluded with the galvanization of liberal capitalism, that history makes no more sense. Fukuyama’s theory is a slapstick narrative of hyper-valuation of the ‘mad economics’ of late capitalism and hypo-statization of reality that has no relation at all to the real in the world out there. Fukuyama had taken as ‘real’ what is actually ‘virtual’, and froze time much like unto a fairy tale of timelessness, of history-less Nietzschean moment that is fit more for infants than for adult humans.

Fukuyama epitomizes the ‘mad economics’ of all those Pied Pipers of the global oligarchy for whom he works, and his discourse is akin to the ‘mad discourse’ so described by the late Michel Foucault. The ‘mad economics’ of Friedman, Hayek, Fukuyama, and all those technocrats who serve as processors and bagmen for the global oligarchy, is precisely symptomatic of that colossal ailment of a world system, and as we all know, madness can never salve ailments but rather hasten the system’s death. Caput! Blow your horns, prepare dirges to this Dead One!

Unless that you yourselves have become maddened by the seemingly infinite monies flowing unto your purses as you are among the beneficiaries of ‘late’ capital, unless that you are indeed now suffering from combined maladies of sociopathy and schizophrenia, unless that sanity had departed from thee forever, please heed the last plea of your own conscience where sanity had retreated: CAPITALISM IS DEAD! No amount of propagandizing, of contorted interpretations, can ever change the course of history at this juncture, as we are all headed for a TOTAL SYSTEM COLLAPSE in the months ahead. Read that please: MONTHS AHEAD, not years ahead.

What went wrong with capitalism? I’m sure all of you fellows knew what went wrong, do I even need to answer that? Your previous thinker mentors, among economists and sociologists, forewarned you all of the forthcoming demise of capitalism, but you paid nary an attention to those brilliant minds as you were so engrossed in your ‘conspicuous consumption’, behaving more like some infantile EATERS or as anthropoids rather than as thinking and spiritually evolving humans. You are all very much human, so please consistently behave like one, and begin by listening to the Inner Voice of your conscience, for that voice is your soul’s.

Let me summarize the diagnostics, forewarnings and/or prophecies of our thinker mentors from the West, and I’d stress WEST because there are some other thinker mentors from the EAST and SOUTH whose peregrinations are so recondite they are not so easily digestible. Let me just stress the WEST as this is what is common to us all. So let me re-echo the thinkers and their theories:

· Karl Marx & Friedrich Engels: The internal contradictions between the private nature of capital (ownership of means of production) and the social nature of production. The ‘crisis of overproduction’ and the ‘law of the falling rate of profit’ are attendant patterns. Social revolution results, then the alternative society will be constructed.

· Max Weber: Industrial capitalism’s granite product, the bureaucracy, led to dehumanization. He never forecast though whether this dehumanizing system can be sustained—but please read between the lines. (His contemporary Emile Durkheim had a similar observation about ‘anomie’ or normless state of urban/industrial society.)

· Thorsten Veblen: The end-phase of industrial capitalism is markedly pathological. ‘Conspicuous consumption’ is the disease of this phase, the toxic behavior from the ruling class that later filtered down to the emerging middle class.

· Joseph Schumpeter: The internal contradiction between the desire for profit and the revolutionary character of innovation. The demise of capitalism will see the possibility of the technical class taking over society and build that alternative system later.

· Daniel Bell: The ‘post-industrial’ society had already been born right inside capitalism. A distinct modality in itself, post-industrialism will eventually prevail in a system that isn’t capitalist (or money economy) but rather knowledge-based. The ‘service worker’ had arrived on the social landscape, the prototype class of the future.

· Theodore Adorno, Jurgen Habermas, Herbert Marcuse: ‘Late’ capital is characterized by the pervasiveness of ‘instrumental reason’, where reason is used to justify the non-rational (‘madness’ in Foucault’s argot), where state planning/intervention was infused into a system that scorned intervention.

· Alvin Toffler: Both capitalism and socialism are based on hoarding, both are variants of the same industrial society of yesteryears, both are based on ‘2nd wave’ capital-intensive technologies and non-renewable energy sources. The ‘post-industrial’ society is altogether distinct, isn’t based on hoarding, production-consumption (‘prosumer’) is based on ‘3rd wave’ knowledge-intensive technologies and renewable energy sources, knowledge cannot be hoarded.

I need not articulate further, do I? They all converged on one theme: capitalism is transitory, it bred social maladies (alienation, dehumanization, anomie, conspicuous consumption,…), is systemically flawed, and will be dismantled at sometime in the future.

No matter how delimited their theories maybe, as they all proceeded from certain perspectives (they were all ‘paradigm’-based in the jargon of Thomas Kuhn), they all proclaimed—in either tacit or explicit fashion—the coming demise of the system. They weren’t as silly as Fukuyama who popularized seemingly ‘satanic verses’ (distorted precepts) about a non-changing, permanent economic landscape called ‘liberal capitalism’, but were rather so adroit at social forecasting that they saw a vision of the future as they were articulating on their empirical observations of the present society.

So, fellows out there, prepare for the months and years ahead. We are headed towards those stormy months, years, maybe even decades. How the future society will come to shape is not easy to forecast. “Something blurs the Force, darkens our sight of the future,” declared a Jedi Master in the Star Wars cinema fame. Let me end right here.

[Writ 22 August 2008, Quezon City, MetroManila.]



July 16, 2008

Erle Frayne Argonza

Maganding umaga! Good morning!

A gladdening news for me is the fact that many people in the West (or North) highly appreciate Asian growth and its role as today’s life-breather of the global economy. Without Asia, given the recurrent recession of Western/Northern economies, the global economy would be in a collapsed state today.

The added news that certainly warms the heart is that many Northerners/Westerners look up highly to Asia as the hope of the world, that hope coming precisely from the Asian Renaissance. We seem to be in a rehash of that situation of the medieval age, when the ‘world system’ collapsed due to incessant wars organized and financed by the Venetian mercantile oligarchs, leading eventually to a Dark Age. The (Western) Renaissance became the light of the Dark Age and teleported mankind out of that catastrophe.

In the current circumstance, a Dark Age looms as the Anglo-Dutch oligarchs organize and finance conflicts of every kind across the globe, which will expectedly lead to a larger conflagration that will be sparked off by the Sunni-Shi’ite conflict and then move on to ignite other conflicts in all regions and continents. The conflagration will be a near repeat of the Peloponnesian Wars (Athenian oligarchs’ wars), the Crusades (Venetian oligarchs’ and Norman warriors’), and 30 Years’ War (Church wars, Dutch-Teutonic oligarchs).  After each conflagration, mankind fell into a Dark Age.

Only a Renaissance, led by Asians, will be the hope for the coming decades or couple of centuries. When the North-South dialogue will collapse and give way to the next Dark Age, induced by the incessant wars of the Anglo-Dutch-Teutonic-Zaibatsu oligarchy (to identify a longer list) up North, then peoples will by instinct look to the south for the sparks of hope, of dialogue and civility. Then the planet shall be jettisoned out of the holocaust, back to the ‘Light Age’ (light is opposite of dark).

Incidentally, many peoples across the globe have already immersed themselves in Asiatic thought streams and their practical applications, such as yoga meditation. So, the Asian Renaissance will not just be a monopoly of people of Asian genetic origin, but will be multi-player from the very inception. Many Asian spiritual masters, gurus and intellectuals transplanted themselves in the West during the past decades, so this explains the permeation in Western cultures of Asiatic thought streams. On the other hand, many peoples of the West/North took up studies in the Eastern institutions and ashrams (retreat centers of spiritual masters and gurus), thus ensuring a more expanded diffusion of Asiatic thought streams in the process. So, as one can see, it has been a two-way process of diffusion and enculturation to Asiatic thought streams.

Any Renaissance takes a long time to percolate, brew and galvanize, so it will not be prudent to demonstrate the exact contours of a gigantic movement—with so diverse players—that is continuously evolving. It affects all human endeavors: philosophy, arts, sciences, technology (biotech, physical tech, social tech). I would confess my own limitation and be honestly humble when asked about the exact contours of this movement. I make no pretensions for being God Almighty who knows best about the matter in its expansiveness and universality.

The following short list of items are what I can share about the matter:

·         Oneness & Becoming: Asiatic thought and practices are products of this single most important cosmic Law of One. Western modality is dualistic and/or binary, resulting to polarity principles and practices that have eroded the very condition of humanity and endangers the species itself. The added premise concerns the process of ‘becoming’ contrasted to Western stress on ‘being’.


·         Pure Thought – without prejudgemental Qualities, premises, biases: Sri Krishna taught us well about the matter. Go back to Srimad Bhagavad-Gita, in the sermon of Govinda to the warrior-saint Arjuna. The essence of Asiatic metaphysics, epistemology, ethics. Jesus and many masters followed through on the ‘pure thought’ modality, on what benefits can be derived from them, what truths derived too. See the New Testament, Dhammapada, Mahabharata, and onwards to the teachings of Baha’ullah, Vivekananda, PR Sarkar (neo-humanism, tantra), Sri Aurubindo, Mahatma Gandhi (Ahimsa).


·         Dialogue & Consensus: In this domain, Asians regard that theory is fact, such as in Western physics where “a theory is also a fact.” Nobody even thinks anymore why dialogue should be ensued as a matter of exercising consensus. It is theory, it is fact, period. But do go back to Lao Tsu, Confucius, Mencius, Buddha. Unfortunately, the Western powers destroyed the teachings of Malayan gurus upon occupying the Southeast, while Khmer and ancient Javanese teachings of the same were simply lost in time as the same civilizations eroded and died. Incidentally, Filipino indigenous teachings, derived from folk lore (of which there are now encyclopedic volumes of scholarly translations) are available, which I myself will have to review (budget constraints delimiting buys).


·         Physics and Multi-Dimensions: The true elements of matter, the different ontological dimensions, and the properties of matter congruent with each dimension. Steven Hawkin’s ‘hyperspace’, ‘lower space’, and ‘higher space’ concepts are nearer the truth than ever. The Book of Dzan, theosophical writings (e.g. Blavatsky’s Secret Doctrine), and synthetic writings such as Fritjof Capra’s Tao of Physics would be good reads. Paramahansa Yogananda’s Autobiography of a Yogi also contains details of masters’ teachings about the same subjects. On the practical side, how to conduct dematerialization and bilocation are explained and demonstrated by the masters. Didn’t mahayogi Jesus Christ (master Issa in India) demonstrate how to walk above the water and materialize fish for a huge crowd of devotees?


·         Yoga and Meditation: Yoga is the science, meditation the practice. Too many traditions to choose from, study and investigate, and practice. Choose that which is in accord with your psyche. In my case, I chose Agni yoga, which synthesizes rajah yoga (focus on crown chakra, will-development), Kriya or Christ yoga (pineal/higher faculties), karma yoga (service/solar plexus chakra), and bhakti (opening up heart chakra). If you wish to use yoga to reinforce healing, Kundalini yoga would be perfect. Bhakti and practices that develop the solar plexus chakra would be excellent for peace keepers and conciliators. Zen would be perfect for highly contemplative, introspective types. Sure, you can combine them, such as what I do.


·         Natural Healing Paradigms & Therapies: Too many to behold, and too popular nowadays. In Manila, with the signing of the ‘traditional and alternative law’ in the late 90s and the creation of a state institution for this, natural healing has become an institution in itself. In my case, I was trained in Pranic healing, and I practice it (pro bono) for psychosocial counseling. Deepak Chopra’s ‘mind-body-soul’ writings (e.g. The Way of the Wizard) would be a good entry point.  

 Well, Partners, Fellows on Earth, those items would suffice. Before I be accused of causing you indigestion, I would stop right there. There are more, so please go ahead and draw the compass of your journey into the ‘Eastern way’. But just to remind you, the great statesman Mao Tsetung once cautioned us: “no investigaton, no right to speak” (see: Selected Readings from the Works of Mao Tsetung, 5 volumes). Nobody should pretend to know Asiatic thought streams without first fully immersing in them, for at least two (2) decades.  

Let me now end by encouraging everyone to learn the ‘Asiatic way’, integrate these into their largely Western psyche, and help in any way to bring us to the ‘dawning of a new age of Light’.

[Writ 26 June 2008, Quezon City, MetroManila]