The Worshippers of Ergod and the omnipresent `Axiomat’{Part 1}

Like many, I was raised on a hardy diet of popular and well-seasoned axioms. A favourite was `no pain, no gain’, which obliged me to throw myself fearlessly and often hopelessly against opposition packs on the sports field. From my usual position on the side-line stretcher, I must surely have noticed my team-mates that left the field unaided, but so blinding was my core belief that this fact did not register. That is, until my eccentric English teacher introduced me to a Mr. Socrates, who gave me the means by which to question this and other beliefs. I am grateful to both teachers, who saved me from further humiliation and quite possibly, a future destined to abusive relationships.

Pain and humiliation, like a red light on a car`s dashboard, is a diagnostic to aid our search for cause. The problem in questioning axioms however is that they are by definition, matters of faith and by extension, something beyond the need of proof or evidence-base. Those who question them tend to be called heretics.

The pain caused by this global financial crisis, should be sufficient enough to test the premises on which our precedent economic beliefs have been built. The fact that it is the worst since the Great Depression, should justify the scrutiny, but will this happen to a satisfactory level?

The Economist recently reviewed three books that sought to explain the nature of the crisis and recommended one that went as far as to offer some solutions. Titled The Keynes Solution, The Economist`s review omits the most startling thesis in the whole book. Written by the foremost expert on Keynes (John Maynard Keynes 1883-1946) economic theory), Professor Paul Davidson (Emeritus at the University of Tennessee) asserts that lying at the basis of neo-liberal theory, one he charges is repackaged 19 Century Classical theory, is the Ergodic axiom. It is a mathematical axiom which holds that: `data samples from the past are equivalent to data samples from the future’. According to the theory that flows from it, humans each day make decisions based on a perfect knowledge of future events. It is from this axiom that economics has been allowed to enter the realm of hard sciences. Unfortunately for the entire world, it was applied to that less than hard science explaining human behaviour.

It follows from this central axiom that all future events, like data, are predetermined and consequently there is nothing anyone can do about it, least of all governments. Sounds familiar? This then would lie at the heart of the faithful neo-liberal free-marketer, who cries `blasphemy` at any talk of government intervention and yet has been obliged to ask for just that.

Where does belief in pre-determination and economic theory find its nexus? And what happens to the belief and its followers, when their most fundamental premise has been proved false? Surely the fact that the crash was not predicted and we have seen the most prodigious interventions of government, should challenge this axiom and the theories that flow from it? But will this challenge come and from where?

The author has claimed, without challenge thus far, that it was blind faith in this axiom, one that did not require empirical evidence base or measure of objective reality that led to the crisis.

Moreover, this blind faith found a rational basis in complex mathematical probability models. It was a seduction of minds at the expense of broader reason and judgement that created the conditions leading to this catastrophe. Of course these complex mathematical models took no account of those ageless assassins in the form of Mr. Greed and Mr.Irresponsility. A view offered by Oxford mathematician Jerome Ravitz (i)

If the Ergodic Axiom does have any predictive quality, it comes in the fact that the macro conditions that caused the crash before the Great Depression were the same as those in 2008. Namely, increased bank underwriting and the banking sector`s promotion of securities to individual investors, as was determined by the 1932 US Senate Commission on Banking and Currency. It was the commission`s recommendations that helped form the Glass Steagall Act of 1933 (ii), prohibiting retail lending banks from underwriting and promoting securities (investment banking). Ironically and tragically, this Act was repealed in 1999, which allowed banks to behave in a similar manner to those prior to 1929.

It stands to reason that same causes provoke the same effects.

How is it possible for students of economic theory to ignore such profound and relatively recent history? How is it possible to forget the great work done by the government of Franklin Delano Roosevelt and his `New Deal`, two-pronged strategy of public spending and regulatory frameworks that produced the enormous post-WW11 prosperity that followed. The New Deal also saw the creation of the SEC and US social security system that has been decimated during the last thirty years by neo-liberal policy. A policy focused on reducing government expenditure, regulatory frameworks and maintaining unemployment as a means of inflation control.

This is despite the fact that the US budget deficit during FDR`s time reached 119% of GDP, achieving a low unemployment rate of 2% that quickly paid off this debt. These facts run in contrast to neo-liberal theory and have somehow been ignored. Despite this knowledge, we have been constantly harangued by politicians and business leaders on the long-term, inter-generational threat of budget deficits. John Maynard Keynes had argued successfully that the key to economic prosperity was a focus on reducing unemployment. He observed during the Depression that when the US government stopped spending, unemployment rose and the economy contracted.
How is it that we are unable to question such anomalies within the arena of public debate?

One theory put forward by the author is that what was peddled as post-war Keynesian theory was in fact, a corruption that varied little from classical theory. It held that unemployment was caused by `rigid high wages’ (unions, workers not accepting market wages). It followed that if such was the cause, the solution may be to weaken the unions and prevent the government from legislating minimum wages.

In fact, Keynes’s view was opposite and one derived from studying the data, showing unemployment greatly increasing during depressions. Therefore, it could not be the worker`s truculence that caused unemployment. Keynes argued, upon the facts, that it was uncertainty in financial markets, leading to increased savings and decreased consumption that led to unemployment. We have seen evidence of this within the current crisis.

It is not clear what the academics of the time were doing to defend Keynes or prevent such a perversion of his theories. Post-war McArthism would not have helped the cause of Keynes, who emerges as a socialist and champion of the worker, who is victim, not felon. His central thesis based on `co-operative agreements between governments and private enterprise to produce a truly civilised society for our children and all future generations’ does not fit the neo-liberal world view. It clearly runs against the prevailing policy of the last 30 years and we thus discover a neo-liberal interpretation of Keynes that is aligned closely with their own.

If this is so, then there is no real alternative policy and a world view greatly narrowed, indeed opposite to what was the observed reality emanating from the Great Depression.

As FDR`s plan was rolling out, Keynes successfully urged the President to stick to the strategy of public spending and financial market regulations, until unemployment was significantly reduced. He prophetically wrote to the president, warning that if the New Deal failed, the future would be left to a battle between classical theory and Marxism.

Keynes theories that addressed unemployment and the inequitable distribution of wealth, as the intrinsic weaknesses in the capitalist model, incredulously have not survived intact to challenge our world view.

If the `Axiomats’ do have a point, it is that we do need a shared premise from which to build arguments and from which we derive the necessary social cohesion to form a civilised society. The problem occurs when such beliefs cannot be challenged and especially when we raise no question, when the observed reality suggests we should.

The classical Mayas, at the peak of their civilisation, also believed in an Erodic process. The mathematics they discovered, predicted future astronomical events. They deduced from this and their belief in an integrated cosmology, a pre-destined future that entirely shaped their perception of reality. Unfortunately, it also blinded them from the objective reality of their deteriorating environment and the imperialistic ambitions of their various invaders.

They would not have had the public forum, or the processes needed to challenge such beliefs. Those who were gifted with this ability were likely to have been born on days not bestowed to philosophers, or sacrificed for their heresy. They were thus unlikely to have had a Socrates within their agora or cultivating critical minds in their schools. But then again, despite all such teaching and all such painful lessons, do we?

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i. ``Mathematics first provided an enabling technology with computers, then with a plausible theorem it offered legitimation for runaway speculation and finally, with models of their value, risk and quality, it framed the quantitative specification of its fantasized products. Mathematics thereby became uniquely toxic, what Warren Buffet has called ``weapons of mass destruction``- Jerome Ravitz, Oxford Magazine

ii. The 1932 Senate Commission of Banking and Currency set up to investigate the cause of the stock market crash.

Cuba Libre for the price of a sustainable idea.

I recently returned to Cuba after a ten-year gap, at the end of a tumultuous year for the world, one that has seen the collapse of the global financial system and as spectacularly, the election of the first Black US President, named Obama. Against such a mix of surprise and calamity, the lure of Cuba had curiously emerged as a symbol of sustainability and social cohesion, as that republic reached the 50 Anniversary of its revolution on 1st January 2009.

Political ideologies aside, it is hard to argue against Cuba`s record of survival, one achieved against the greatest of odds. What seemed at the onset to be a fleeting 60`s social and political experiment, is still intact and its much criticised leadership has outlasted ten US Presidents. The economy has endured, despite the systemic collapse of its major trade partner and one time benefactor, The Soviet Union. Oh yes, it has also weathered the ongoing forty seven year-old trade embargo imposed (despite the vote of 95% of the UN General Assembly against it) by its antagonist, the USA and most recently two hurricanes devastated the country. Within such trying contexts it is tantalising to consider that it may have some ideas to offer a world looking for greater resilience and stability.

The Cuba I find today is bustling with dynamism and purpose. There is a spirit of vitality and industriousness everywhere, with shops filled with goods, in stark contrast to the scene of 1998. Back then the `Special Period`, as it is known to Cubans, occurred as the Soviet economic model imploded and resulted in the loss of the Cuba`s main export market. At the time, the locals were pressed to the limit of their thrift and creativity, with people in apartments growing vegetables on balconies and I recall my taxi driver cutting the engine when coasting downhill to save fuel.

This characteristic resilience has been cultivated throughout Cuban American history, within struggles over sovereignty, natural resources and strategic position, the latter aspect much as Malta might have been in the historical European context. History also reveals that the neighbouring US superpower had long envied Cuba and its position as a launching place to the annexation of the region, as far back as Thomas Jefferson (1743-1826)i. , it`s third president.

Through necessity and some astute social planning, Cuba has produced a cohesive society, one based on an integrated local community. Cubans understand this interconnectedness, this interdependence and the mutual obligation it entails. In such a network a citizen is unlikely to do anything that would damage his reputation. The link between crime and low literacy levels were long ago identified and the policy of life-long learning has created a very adaptable labour force. A highly educated military also enhances national security and poses a strong deterrent.

Some of the new found euphoria may be explained by the discovery of estimated 20billion barrels of oil within its off shore drilling zone, a sovereign territory ironically decreed by US law. This blessing of nature when realised, could place Cuba within the world`s top oil producing countries and on par with the US, providing yet another touch of irony to the epic battle between these two adversaries.

Tourism has been growing rapidly during the last ten years and is likely to promote a more mixed economy. Cuba’s octogenarian leadership recently opened up business opportunities for a wider range of Cuban society. Through the operation of ‘Casa Particulars’, the average Cuban who normally gets paid US 20 dollars per month may be licensed to accommodate tourists in their homes for between US 20-35 dollars per night (for one room), with the state receiving a commission. The result is a dual economy supported by two currencies, the Cuban Convertible Peso (CUC, equal approximately to US1.10) and the local peso (1 CUC=25 pesos), with tourists always charged in CUC. Locals however must convert pesos to CUC for purchase of all but the most staple of goods and services.

In one local village lunch for two, which included the staple rice, beans, pork and beer cost 60 local pesos (equivalent to approximately US$2.50). Across the nearby three lane highway a service station sold me two Nestlé ice-creams for over US$3 and motorists pay US$1 a litre for petrol. Despite the disparity between these two economies it is clear that poverty, as we know it to be in least developed nations, does not exist here. Cubans are well fed, extremely well educated, as evidenced by a literacy rate of 99.8 % (source: Amnesty International 2008 report) and possess an enviable health care system. It is beyond simple irony that there is no evidence of homelessness or beggars in the streets, as these sights become more prevalent in Western cities.

One joy of discovering Cuba is experiencing a cultural milieu of music, laughter and enterprise, which is pure theatre. Everywhere, Cubans stop in the street and are bartering, ‘doing business’. I am unable to easily connect to the internet or `Google`, however I merely ask someone nearby and within half an hour I am likely to have several proposals, provided through the local community network.

The scarcity of material possessions has produced values of durability and efficiency that we in developed countries are yet to appreciate, as resources dwindle. In Cuba there is a palpable transcendence of human spirit beyond the material, expressed in its arts and everyday life that reminds of a past that was more ascetic for its spiritual values, more contributing to collective values and in stark contrast to our Western pursuit of self.

For this reason it is difficult for us to gauge Cuba’s achievements by what has become a neo-liberal definition of ‘freedom’ or ‘liberty’ and when using a moral and ethical compass, lately in need of recalibration. This revolution never produced a cult of celebrity or grand mansions for its leaders (images of any revolutionary leader can only be publicly displayed posthumously). These were not `champagne socialists`, but intellectuals from privileged family backgrounds that abandoned easier lives to follow impassioned earlier examples, in a struggle for a just society.

Their idea was tied inexorably to the great French humanist movement of the late nineteenth century and Cuba`s battle for independence from the Spanish, which it gained in 1895. The visionary leader of that latter achievement, Cuban poet (friend and supporter of French humanist writer/poet, Victor Hugo) Jose Marti (ii.) , had eloquently defined the imperative of freedom as one that excluded hunger and poverty; liberty the victory of independence over imperialism.

Fidel Castro, leader of the 1959 campaign maintains that this revolution was a reinstitution of ideals established by Marti sixty years previously. Castro thus provides a unique perspective of the modern idea as a continuum of older, tested ideals. It also explains the resolve, clarity and confidence of the young rebels, who had studied such histories as a matter of course.

The key to Cuba’s resilience and sustainability lies within its focus on education and health. It is hard to find another nation that can boast a higher literacy rate (prior to 1959, more than a third of its population were illiterate) or some 70 000 doctors, almost half of whom are deployed overseas in developing countries and disaster zones. The infant mortality rate has decreased to 6 per 1000 births and life expectancy has increased 18 (77.5 yrs) years since 1959. In addressing gender/equity issues, women now represent the majority of university entrants, who go on to make up 65% of technical and scientific professions.

Through education, Cuba has been able to build a cohesive and durable culture, one that has the intellectual ability to respond to complex challenges (including the scarcity of resources) and one that can articulate a strong defence of her sovereignty. This achievement is stunning considering that it has been wrought by a developing nation, one whose unwavering public policy was ahead of its time. It is a remarkable reversal of fortune, considering the `brain drain` of professionals that fled the country in the aftermath of the revolution.

Critics of the Cuban idea will point to the regime`s suppression of dissidents and free speech. This is clearly no utopia, despite its self-confessed utopian leadership, nor are there any perfect systems. According to Amnesty International (2008 Report) there remains around 63 prisoner of conscience and 40 on death row, however the death penalty has not been instituted in recent years. The same report states that the USA executed 42 death row inmates and continues to hold ``hundreds`` of foreign nationals, without charge and recourse to any legal challenges. Most ironically they are detained at the Guantanamo Naval base, in Cuba.

It is fair to say that despite the early focus on agrarian reforms, Cuba has not been able to adequately diversify its agriculture and 35% of its food needs are imported, again ironically from the US (Cuba is required to pay cash for shipments). However, at some point in its evolution and faced with much scarcity, the planners of this idea had decided to reinvent the country`s comparative advantage, from that of a primary resource producer to an exporter of knowledge in the areas of health and education. This could not have been an easy task, however Cuba now benefits from the exchange in trade of its human capital, especially doctors and teachers.

Cubans are happy to discuss and debate the shortcomings of their socio/political model,however they have unquestionable national pride in the durability of their idea.This solidarity provides robust national security and the leadership could only have survived because of it, whilst somehow evading numerous assassination attempts from outside the country (iii).

Evidence could not be closer, as Cuba`s greatest critic is a superpower that lies only three hundred kilometres away and incredulously operates a military base (US Guantanamo Bay iv. ) on Cuban soil. Yet despite being thus surrounded, the country has never been invaded (the failed US Bay of Pigs invasion in 1961, the notable exception) or has a counterrevolution found enough local support to succeed during fifty years.

Several questions cannot be answered easily and others will only be tested in time. Would the resilience of Cuba have been so great had there not been the trade embargo or the various trials which must have surely tested its resolve and integrity? What will happen when the embargo is finally lifted and the next generation of leaders emerge? Though their strong education would have taught them the lessons of history, will it be enough to ensure the longevity and relevance of ideals, in a more open and globally connected nation? (The Obama administration has foreshadowed a more open dialogue and the newly elected President immediately signed executive orders for the closure of Guantanamo Bay detention centre.)

In the face of great odds, Cuba has demonstrated that sustainability is an attainable goal, one that is possible through social cohesion and on a foundation of proven ideals. There is reason enough to believe that with a continued focus on education, the nation can adapt itself to the rapidly changing, global landscape, without losing the hard won lessons of its struggle.

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notes
i.`I candidly confess that I have ever looked on Cuba as the most interesting addition which could ever be made to our system of States. The control which, with Florida, this island would give us over the Gulf of Mexico, and the countries and isthmus bordering on it, as well as all those whose waters flow into it, would fill up the measure of our political well-being`. Thomas Jefferson (1743–1826), U.S. president. letter, Oct. 24, 1823, to President James Monroe


ii.`It is my duty to prevent, through the independence of Cuba, the U.S.A. from spreading over the West Indies and falling with added weight upon other lands of Our America. All I have done up to now and shall do hereafter is to that end.... I know the Monster, because I have lived in its lair—and my weapon is only the slingshot of David`. - José Martí

iii. The US Senate`s Church Report (1975) on alleged assassination plots involving foreign leaders, found that ``United States personnel plotted to kill Castro between 1960-1965``. Furthermore it states that ``American underworld figures and Cubans hostile to Castro were used in these plots and were provided encouragement and material support by the United States.



iv. In 1901 the US Government Platt Amendment set out guidelines for future US/Cuban relations, mainly allowing US military and political intervention in Cuban affairs and protecting US business interests. It included the establishment of US naval bases, one of which was at Guantanamo Bay. Despite Cuban protest, the amendment became part of the Cuban Constitution of 1902. The Amendment also excluded Cuba from entering into treaties with any other foreign power. In 1934 US President Franklin Roosevelt abrogated the amendment and the subsequent `Treaty of Relations` , allowed the maintenance of a single US base at Guantanamo Bay. Source: Wikipedia

L`identité nationale ou une dérive de politique?

D`abord, ce sujet n`est qu`un débat politique et spécifiquement d`immigration pas culturel, parce que il était soulevé par le ministre de l`immigration, Eric Besson. Je voudrais demander, pourquoi en ce moment et pourquoi le sujet d`immigration ? Pourquoi maintenant quand nous avons d`autres priorités comme la crise économique et le fort chômage ? N’est-il pas de stratégie politique qui espère le changer de débats publiques au bénéfice du gouvernement et particulièrement une stratégie électorale avant les régionales ?

C`est un débat qui était utilisé avec efficacité pendant l`élection présidentielle en 2007, selon Vincent Tiberj, chercheur en sociologue politique à Science Po, qui a écrit à propos du sujet (La Crispation Hexagonale, 2008). Il a souligné avec clarté qu` en ce moment le gouvernement a besoin de diversion. Evidemment, les affaires de Frédéric Mitterrand, l`économie, de Jean Sarkozy sont la cause de la chute de popularité du président Sarkozy et de son gouvernement. Mr. Tiberj a aussi noté que c`est une stratégie de <> bien utilisée par Mr. Sarkozy depuis 2002.

C`est une stratégie utilisée par beaucoup de gouvernements dans l’histoire et dans le monde aux moments de crises.

Je crois forcement que ce sujet est important, mais pas le point focal en ce moment. D`ailleurs le Français est une culture qui s`est prouvé très résistante au changement, avec l`identité très unique et avec les valeurs républicaines qui sont enracinées dans les cerveaux de tous citoyens.

Enfin je crois que nous sommes obligés de travailler ensemble pour trouver des solutions aux problèmes complexes devant nous, comme l`économie et le chômage, pas l`identité française.

Nicolas Hulot, l’exception qui a cassé la règle Française

Il y a deux thèmes notables dans la vie professionnelle de Nicholas Hulot. D`abords, il a changé de métier plusieurs de temps. Il avait commencé sa carrière comme plagiste, puis il est devenu moniteur de voile et ensuite un photoreporter. Alors, ces expériences lui ont permis de voyager et vivre des aventures autour du monde. Il était témoin du tremblement de terre au Guatemala en 1976 qui a tué 20 000 personnes. Ensuite il a voyagé au Afrique du Sud et pendant la guerre d`indépendance en Rhodésie, il a interviewé Ian Smith, Premier Ministre en 1976.

Un peu tard, il débutera son carrière dans métier audiovisuel, d’abord à la radio et puis à la télévision avec une émission pour les enfants (Les Visiteurs du Mercredi, en 1980).

Je crois aussi que ces expériences l’ont touché profondément. Il a pris conscience de plusieurs problèmes concernant l`humanité et l`environnement. Il a aussi un esprit d`entreprise qui a motivée ses campagnes pour le sauvegarde de la planète. Passionné par sa cause, il a commencé sa vie politique et a été à l`origine d`idée d`inclure une Charte de l`environnement dans la Constitution depuis 2005. En 2006 il a lancé Le Pacte Ecologique qui montre le débat public. Ce pacte sera signé par 5 sur 12 candidats présidentiels et plus que 700 000 personnes.

Enfin, on trouve dans la vie de Nicolas Hulot une ouverture d`esprit et un courage rare. Malgré la majorité qui en France pense qu’une carrière diversifiée n`est pas possible, il a prouvé la contraire.