John Ward – How NeoCon Lunacy Got Us To Here, Where Mutuality Could Get Us Out Of It – 9 July 2013

John WardNever, ever follow the money

Money talks, the bankers say/it helps to smooth the way,

but when I married money/she had nothing much to say

     (E J Slog)

“Follow the money,” Deep Throat kept on telling Woodward & Bernstein in 1972, “follow the money”. What he meant, of course, was “this entire organisation (CREEP) is rotten and funded by illegal money from top to bottom…so follow the money”. Neocon Friedmanite economics, and the Governments who continue to apologise for it, have together produced a business ethical gestalt that is also rotten, corrupt – and often funded by laundered money or secret taxpayer stimulus. Friedmanites follow the money, because it’s all they care about. But Milt Friedman was wrong about two things: human greed (which he ludicrously underestimated, being a highbrow academic) and shareholder value – aka money – being the only important factors in commercial life.

I offer you now an alternative way of thinking: ‘Never think about the money: follow your best instincts to produce something of superior quality, and the money will follow you”.

Neocon thinking is counterfeit. Mutual thinking keeps us true to ourselves. True is always better than fake.

It applies to all the most successful personal relationships as well. You can meet a woman, and make the bedroom action your target by impressing her with a lot of bullsh*t about who you are. Or you can be yourself, and wait for the action that always follows mutual admiration.

To me,  the Grand Canyon that lies between the neocons and the mutualists – between Goldman Sachs and John Lewis if you will – is the counterfeit ranged against the genuine. The mutual goal is quality that retains customers – the healthy proft margins are the result of it, not the point of it. I can hear Dan Hannan snorting from here, but I worked in business for 35 years, and he didn’t. I moved to the ad agency Collett Dickenson Pearce in 1974, and immediately learned that simple lesson: do something different and engaging, and the clients will come in….f**k the money, do something famously effective. Based entirely on that principle, CDP went from £14.5m billings in 1973 to £210m by 1982. (To do it properly, by the way, founding Chairman John Pearce took the agency back off the Stock Exchange).

The place had a culture: everything comes second to excellent, mould-breaking advertising. Between 1975 and 1980, it had the lowest rate of client turnover in the UK top ten agency listings.

When two key managers left to form Lowe & Howard-Spink, CDP lost its culture, and slipped back into obscurity. It was bought by Dentsu, and now no longer exists.

A culture of excellence is everything, and then some. Neocon economics is just a bigger version of the rise and rise of the braindead, uncreative accountant who knows the cost of everything, and the value of nothing. Its watchwords are caution, shaving at the edges, think of the share price, the dividends come first, globalism and….in the end, illegal, bullying monopolism. Multinational companies, on the whole, don’t give a monkey’s about quality: all they want to do is stitch up a sector, kill off all the competition, and then give the consumer just one choice – their product. If you don’t have any other product with which to compare it, what are you going to do? Correct: buy their product.

Does that system remind you of anything? Me too – Soviet command economy Communism. What an irony: for decades, the Hunts of this world have been boffing on about choice. Know how Jeremy made his money at Hotcourses? By being a monopoly supplier to The British Council.

All these people can offer is the culture of cost-caution bizarrely mixed with insane speculation, greed, and Do Whatever It Takes. In that ‘society’, artistic creativity wilts, and one gets formulaic TV and theatre. The Rule of Law is flouted at every turn. The product quality is diluted to increase margins shaved by doing dumb-arsed short-term deals with distributors. The consumer’s experience is degraded, and multiple retailer power grows. Small niche quality retailers are starved out by the Walmarts and Tescos. Communities fade away. Badly made technological ‘beads’ are imported from China, herding people into their own rooms and worlds. The beads breed yet more social isolation….and a bigger trade deficit. To bolster margins still further, the multinational money-seekers erode after sales service. This creates blue-collar unemployment and consumer frustration. That puts up the welfare bill (more Sovereign borrowing required, higher deficit) and reduces social contentment. Then one day it dawns on the f**kwits that sales are slipping because (a) people are buying cheaper imports and (b) you just reduced the real value of their income by 30% in a decade, or (c) they’re unemployed, because you moved their job offshore.

So what you do now on Planet Neocon is leverage. We godda leverage guys! Load the bazooka and fire that missileverage! Yo! Waydergo! High Fives!

But it neither reduces the debt nor stimulates the economy – see reasons (a) to (c) above. All it does is increase the deficit, the overall debt, and reduce bondholder confidence.

So to manage the debt, you have to Zirp. We godda Zirp guys! Grab that machete, and cut that rate! Yo! Waydergo! High Fives!

But the debt just keeps on getting higher. And Baby-boomer consumers – massively important now – get their retirement income slashed. Durable, holiday and automotive sales slump. More unemployment, more welfare cost. More investors looking for somewhere to go, because you Zirped them.

Gold shoots up, so you have to suppress it, otherwise the stock market will collapse. Banks are in reality insolvent, so you have to bail them out – and then depress the gold price still further to refill the financial sector’s Nottingham Lace balance sheets. Your national debt doubles, and investors have nothing left to invest in. So your bond yields spike.

You’re running out of money. You print on the sly, or indirectly. Folks notice. You start to hunt around for more real money. You start to steal from depositors. So you take away even more mass consuming power – or ability to survive in retirement. Output falls, welfare costs rise. Debts get out of control. Troikas move in. Politics starts to polarise. Neocommies and neofascists come out of the woodwork. Suddenly, your government is cooperating with them, because it no longer has any choice.


That’s a headlined, simplified account of the path we’ve been following in the West, and how we arrived at today. A today where neocon economics and the unrestrained leverage-cum-derivative focus on monied ‘profit’ have produced globally incoherent markets, hopelessly unbalanced central bank strategies, debts so huge that only eternal Zirp will ever make them affordable, rigged markets to stave off a panic desertion of equities, investment fundamentals that no longer make any sense either mathematical or logical, a mass consumption model minus mass consumers, and stock prices held high by already struggling taxpayers….who now find their governments running away from Sovereign duties of care like a battalion of pacifist Italians.

Want to know why so many ‘leaders’ keep on apologising for Friedmanite globalist necon economics? Because it represents a theory doomed to become an apology for the whole idea. The economics of false growth, unjustified speculation and monopolist caution are a crock of contradictory, dead-end ideas invented by a useful academic idiot, and grabbed with near-orgasmic enthusiasm by a tiny minority of unbelievably brass-necked greedy bastards. Trust me, there’s a lot to apologise for in there.

It has brought us to this point because it is the evil described originally – when not taken out of context – thus: ‘The root of all evil is the unreasonable worship of money for its own sake’.

The last four words there are key to the theme of this piece. Don’t worship money, seek fulfillment. Don’t worship winning, try your best. Don’t settle for ‘good enough’, find your metier and then seek excellence. Don’t screw customers, amaze and cherish them. Don’t try to rule the world, aim for self-sufficiency. Don’t want to be the biggest, be the best and you will grow anyway. Never follow the money, always look to raise your standards.

To rebalance life in our culture, we most bury forever the philosophical corpse that posits but one duty for commerce: the shareholders. Licking multiple retailers, analysts, bankers and shareholders all over takes the corporate eye off the ball: the end users, and their willing loyalty. Nothing else matters beyond a corporate culture focused on product quality, because only a mutual culture of interdependence with the consumer can deliver that freely-given loyalty that produces genuine organic growth.

There has been an attempt in recent years to slag off mutualism as a dated, dysfunctional, staid and self-satisfied commercial form. Well, had we stayed with it during the 1990s, we would not now be paying for Lloyds, HBOS, or RBS….and our bailout costs would’ve been decimated. (Detractors of course love to quote the Coop as a failure: but the Coop, Nationwide and Midlothian only got into trouble when they started dealing with neocons, and/or stopped behaving like mutuals).

Mutual company formations are now the fastest-growing sector on Earth. As the Friedman-Levitt mountain of bollocks finally collapses into an avalanche of unstable wobbly bits, mutuals will take their rightful place as still, by far, the most honest, true and stable way to achieve modest growth and contented societies…and an important economic sector.

Not the only one, by any means. But our problem in the UK is painfully obvious: we have an economy based on  financial globalist price competition – and if we stay there, then frankly we might just as well gulp down the hemlock now. The way forward for Britain is a greater emphasis on higher-margin exports of physical wannahaves for the developing East, a less globally interdependent financial sector, and much more emphasis on encouraging SME creativity and home-supply farming…as opposed to robbing SMEs to help restore shattered bank finances. Easily the best way to achieve that across agriculture, industry, retailing, financial services and manufacturing is by staying focused on the best product quality for the end consumer. And the company format least likely to lose the plot on those goals (with Homo sapiens, that’s as good as it gets) is the Mutual one.

Now, you may well have spotted that none of the three major UK political Parties would buy that analysis. That’s why The Slog is radical but unaligned. / link to original article


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