New feudalism ante portas

[Rosacrux redux]

This is not an easy subject and one that allows no impartial approach, so I’d like to suggest we remain calm, not-too-shallow and try to provide with arguments and food-for-thought rather than flames and pointless namecalling.

I’ve read somewhere the words “neo-feudalism” in conjunction to the way our world (socially and financially) is moving towards, and it really got me thinking. What was the context? All right, here is a brief rundown on the specifics:

- the middle class, accepted to be the cornerstone of the “western democracies”, is shrinking in a quite impressive manner. Elites worldwide consider the middle class to be more consuming than producing (and with the aging of our population the balance of only-consumers to consumers/producers grows at a disproportional rate) so they consider that the economic model that was established after the Great Depression (New Deal, based on Keynesian models, spread on the whole globe afterwards) has to go completely.

- The Keynesian model provided a balance of consumption and production, by introducing checks and balances to allow for a wider spread of the wealth. The main tool it uses is governmental spending, so it is based on a large tax revenue. The concentration of wealth in pre-depression USA was like 87% of the wealth in the hands of 1% of the population. When the petroleum crises of the 70s kicked in, there seems to have been an inability of Keynesian models to untie the Gordian (oil) knot. So, starting with USA (Reaganomics) and UK (Thathcernomics) the early 80s witnessed a revival of the lessaiz faire school (the one of the famed Adam Smith) in the form of the Neo-classicist approach (first introduced by Milton Friedman and the “Chicago School” of economists). Please note that the cut in the federal spending in USA did not include any significant (percentage wise) cut in the military spending at first, so it was based solely on public services and spending.

- The current trends point towards a depreciation of the labor in favor of the capital once more. In simple words this concept reads “doesn’t matter how hard you work, unless you own the business you get peanuts”. Certainly exceptions are applicable, but as a general rule this is very much true. People in Europe and USA have to maintain two or three occupations to make it through with expenses and live at an acceptable standard, while wealth once more is being concentrated by a very small part of the population. The current numbers in USA are a highly alarming: 1% of the population owns now 76% of the wealth and if they carry on in a few years they’ll surpass the pre-depression rate also.

- The “new giants” of the world economy, namely China and India, are following a non-middle class model anyway. In China there is no middle class to speak of, while in India there is a small elite-ish middle class that is very much wealthier than the low classes, those constituting the 70% of the nations populace. The “West” follows put: current neo-classical models implemented in USA and ante portas in several EU countries, speaks about cheap labor in the basis of everything, and fewer taxes for the businesses. That means that the government won’t be able to spend much on healthcare, education etc. And that the lower classes (soon to be: the vast majority of the population) won’t have the means to pay for those “goods” in the “free market”. The trend is being amplified by the new draconic anti-worker legislation, passing in every EU country slowly but certainly.

Isn’t this process leading to a society similar to the one pre-depression? Very few people owning everything and the vast majority of the society barely making a living and sustaining their families by working endless hours for no extra compensation?

Isn’t this feudalism all over again?

[imb39]

In Britain there was an explosion of the Middle Classes during the eighties. This has continued to exapnd even now. It is the dominant class now in many ways - but of course it does depend on what you mean by 'middle class.'

[Rosacrux redux]

Actually, the middle class is becoming smaller everyday in Britain too...

...this has to be the single most unpopular topic ever on the Thema Devia forum! I feel honoured... well, sorts of...

[imb39]

Actually, the middle class is becoming smaller everyday in Britain too...

...this has to be the single most unpopular topic ever on the Thema Devia forum! I feel honoured... well, sorts of...

Well, I thought I would make an effort and contribute!

Compared to the seventies, there are many more middleclass; compared to the eighties, there are many more middle class. Maybe there has been a drop since the nineties, but I doubt that.

[Ummon]

Robots. Otherwise, problems will arise.

Furthermore: this is where we must resist the trends of our society. Press on towards a more technological economy. If not we will infact see the coming of a new middle-age, and human beings will be used by other human beings as tools, on a large scale.

We must pass to an economy based on non-conscious machines. Or we are :wub:*d.

[Marshal Qin]

funny, you wrote what I have been thinking for the last 2 or 3 years, though I called it economic feudalism.
Unpopular, probably not, just hard to refute or make dumb one-liners about....mostly. /\

Until such time as the ability of voters to decide who will be in power is removed completely, I can't see feudalism fully returning, though the middle class will probably become very small. Those in power will want a return to power and will have to provide some sort of compensation to those who vote for them.

If what you say is happening, i.e. feudalism is making a comeback, it means we will never advance far as a species because in time there will be another round of revolutions and wars similar to the end of the medieval era leading up to WW1. Disruption on the scale of the last few centuries will surely knock us down several rungs on the ladder, and if the cycle of:
feudal---->democracy---->neo-feudal/economic feudal----->democracy---->feudal... ad infinitum
(where the '----->' indicates a period of social strife and conflict and 'democracy' is just a word to describe a system that has a large middle class.)
social strife (as opposed to unrest), and wars will have a greater effect on developed and developing nations than in the past due to the heavy reliance modern nations have on a highly developed infrastructure - resulting in much longer recovery times before nations are able to move forward again.

[Ummon]

Unpopular, probably not, just hard to refute or make dumb one-liners about....mostly. /\

I consider this a flame, whether you are referring to imb's post or mine. If you disagree, discuss, instead of giving us such vague suggestions.

Rosacrux: ad portas would maybe be more correct.

Hannibal ad portas (est). ---> Hannibal is at our gates (and wants to come in).

Hannibal ante portas (est). ---> Hannibal is at our gates (sitting there idly, or no further information given).

Latin is a very precise tongue.

[MoROmeTe]

Rosacrux, it ain't neofeudalism or anything like it, it is just capitalism + consumerism pushed towards its last consequences. Practically our (economic) world is being parted sort of how Moses partet the infamous Red Sea. On one side we'll have the conscious, intelligent, capable (emphasis here) of making money and securing their independence from various sources of influence.manipulation. On the other side we shall have numerous uncounscious, practical but not inteligent, manipulated, insecure, consumist persons that will live their lives in semi happiness providing. One can guess which side is more numerous and which side on wants to be on...

We won't go back into feudalism. We will refine capitalism/consumerism (I' tempted to add democracy) to the point where most people will be happy and content to be producers and consumers and only rarely thinkers...

[Ummon]

And you are sure this is unavoidable? Reclaim yourself for yourself, as Seneca used to say, but also try to help others doing the same. To any problem, there are countless solutions. It is laziness to let oneself be led to the easiest one whent here are better options.

[Rosacrux redux]

Imb39
I appreciate your effort to contribute to this, my comment was not directed towards you, it was just a general remark seeing that after a full 24hours there was one single comment. I do believe though that the middle class (as in what the middle class was in the post-WW2 world that is, not what passes as “middle class” in the neo-feudal economics) is diminishing in the UK as in the rest of the world. If you have any data stating otherwise, we should see them and discuss them.

Ummon, I am quite sure Marshal Quin was not talking about you – he just stated the obvious that this subject does not allow for one-liners …I think.
Please folks; let’s not start a fight here, shall we?

BTW thank you for the lesson in Latin – as you probably understand, Latin is not exactly my strong point.

As for your suggestion about robots… I am afraid the rise of the technological level (and the dependence of the economy on non-conscious machines) is going to shorten the road towards neo-feudalism, rather than make it harder to go there. It has to do with further depreciation of labor and non-essentiality of the working classes in the manufacturing process – since the neo-feudalism trend speaks also about less and less taxes for the capital-holders, this means there will be no money for welfare for the too many unemployed in our future.

Marshal Quin

Until such time as the ability of voters to decide who will be in power is removed completely, I can't see feudalism fully returning, though the middle class will probably become very small. Those in power will want a return to power and will have to provide some sort of compensation to those who vote for them.

Absolutely, but what sort of compensation? Since we witness an everyday drawback to pre-depression or pre-WW2 legislations worldwide, there seems to be a discrepancy between what the large body of the voters wish and what the governments to. The checks and balances of democracy seem to fail everyday more to mirror the growing power of the corporations and wealthy individuals who actually run our world via proxy (the governments).

If what you say is happening, i.e. feudalism is making a comeback, it means we will never advance far as a species because in time there will be another round of revolutions and wars similar to the end of the medieval era leading up to WW1. Disruption on the scale of the last few centuries will surely knock us down several rungs on the ladder, and if the cycle of:
feudal---->democracy---->neo-feudal/economic feudal----->democracy---->feudal... ad infinitum
(where the '----->' indicates a period of social strife and conflict and 'democracy' is just a word to describe a system that has a large middle class.)
social strife (as opposed to unrest), and wars will have a greater effect on developed and developing nations than in the past due to the heavy reliance modern nations have on a highly developed infrastructure - resulting in much longer recovery times before nations are able to move forward again.

Neo-feudalism seems to me more sophisticated than it’s medieval counterpart. It has to be, the world has moved on ever since.

Medieval feudalism was based on two legs
- The “right” of the ruling class to be in the position of power (the tradition of slavery in the ancient world did provide for a rather nice theoretical and practical background for the “new” slavery, serfdom)
- The existence of the organized religion

The first leg is self-explanatory, the second one needs more elaboration: the church with all its powers tried to preserve the feudal world, by declaring in every possible way how there are superior and inferior people socially-wise, while noting that this is not the case with “the other world”, as in Heaven people are equal. This is the “opium for the masses” role the church played with considerable success throughout the ages.

The concentration of the power and wealth in few hands, could only last so far: the artisans and merchants managed to accumulate enough wealth to challenge the power of the nobility – also by supporting the monarchs, always at stakes with the nobility throughout the ages. The transition to the modern world witnessed the fall of the previous ruling class (nobility) and its gradual replacement with the new ruling class (those who managed to accumulate enough capital). That is how the previous feudal world fell. But the lessaiz faire economic models that prevailed in the first century of the “capitalist” world, did also result in similar, feudal, social structures. We only need to remember how workers (hired labour, in general) were treated during the 18th and 19th century. The socialist movements became an opposite force, but the consensus between the opposing powers would not be made until the Great Depression came and showed in the most profound way the inability of a world where all the wealth is concentrated in very few hands, to deal with a prolonged growth curve.

70 years after the reach of the equilibrium (not a very stable one, but nevertheless it’s there) the neo-feudalism (economic feudalism, as you call it, is less catchy but does describe it’s effects more accurately I must confess) is not bound on making the same mistakes over. The new middle class, the one that overthrew the feudal lords of the past, is getting weaved together with their “masters” with a set of dependencies that is hard to overcome (actually, they don’t want to overcome it).

The new serfs (the vast majority of the population) shall be kept in place with others checks:
- Dependability (rising unemployment means you’ll consider yourself lucky if you have any job at all)
- Debts (most people won’t be able to do much if they owe anything they have or anything they’ll ever earn, to the banks)
- Consumerism (driven by credit alone, since the income of the lower classes actually don’t earn enough to consume as much as to keep the economies running smoothly and the profits coming in)

Consequently, since this is not the good’ole feudalism but something completely new (although in its basis it has the same principle) I don’t see it as inavoidable to start another cycle of the old process again.


MoRoME

Rosacrux, it ain't neofeudalism or anything like it, it is just capitalism + consumerism pushed towards its last consequences. Practically our (economic) world is being parted sort of how Moses partet the infamous Red Sea. On one side we'll have the conscious, intelligent, capable (emphasis here) of making money and securing their independence from various sources of influence.manipulation. On the other side we shall have numerous uncounscious, practical but not inteligent, manipulated, insecure, consumist persons that will live their lives in semi happiness providing. One can guess which side is more numerous and which side on wants to be on...

We won't go back into feudalism. We will refine capitalism/consumerism (I' tempted to add democracy) to the point where most people will be happy and content to be producers and consumers and only rarely thinkers...

That’s not the case. The structural similarities are very much alike and the fact is that this society won’t give a rats arse if you are conscious and intelligent – the only factor that will count is if you are capable on making money (for the power-holders) and nothing past that.

Maybe neo-feudalism doesn’t sit well with you, but the “economic feudalism” M.Quin talked about is definitely more accurate a description. If you think about it in that context, I guess you’ll find it rather fitting.

[Ummon]

Ummon, I am quite sure Marshal Quin was not talking about you – he just stated the obvious that this subject does not allow for one-liners …I think.
Please folks; let’s not start a fight here, shall we?

It makes no difference: the comment is wrong anyway.

[BTW thank you for the lesson in Latin – as you probably understand, Latin is not exactly my strong point.

It isn't mine either. :wink:

[As for your suggestion about robots… I am afraid the rise of the technological level (and the dependence of the economy on non-conscious machines) is going to shorten the road towards neo-feudalism, rather than make it harder to go there. It has to do with further depreciation of labor and non-essentiality of the working classes in the manufacturing process – since the neo-feudalism trend speaks also about less and less taxes for the capital-holders, this means there will be no money for welfare for the too many unemployed in our future.

Let's see:

1) We invest our productivity into replacing low-end worker class with machines.
2) All men become slaveholders: they possess robots.
3) Meanwhile, they are also involved in high-end works, like intellectual or organizational activities. Those who don't want to work in those fields (or are not competitive-qualified enough to do that effectively), do not work as such, and receive only the wages of their slave pool.

True socialism based on mechanical slaves is infact possible. It is socialism based on human slaves, which doesn't work. Robots earn no wages, thus their work, given an amount of maintainance, is free plusvalence.

[Rosacrux redux]

1) We invest our productivity into replacing low-end worker class with machines.
2) All men become slaveholders: they possess robots.
3) Meanwhile, they are also involved in high-end works, like intellectual or organizational activities. Those who don't want to work in those fields (or are not competitive-qualified enough to do that effectively), do not work as such, and receive only the wages of their slave pool.

True socialism based on mechanical slaves is infact possible. It is socialism based on human slaves, which doesn't work. Robots earn no wages, thus their work, given an amount of maintainance, is free plusvalence.

There is one little problem with your assumption and that's #2: you presume that everybody all men become "slaveholders" (as you put it...) which is definitely not mandatory. On the contrary, only those with need of workforce shall become "slaveholders" and thous the hole in that argument grows into one big Grand Kanyon... those who will own "slaves" (machines) will benefit but they will be precisely a small fragment of the population - those who today use paid labour.

imb39

I'll check your sources and respond promptly. But from a first reading, I think there's a major flaw there (and if that's official statistics, the flaw becomes even more ...well... flawed): They consider all white collar jobs (as well as highly trained/skilled blue collar jobs) as "middle class", which is completely irrellevant to the point. Doesn't matter how skilled in your work you are, what matters is what your income is and what kind of lifestyle, compared to the upper class as a measurestick, does this income allow. An even better indicator would be the spread of common stock and the percentage of very small businesses.

[4th Regiment]

Doesn't matter how skilled in your work you are, what matters is what your income is and what kind of lifestyle, compared to the upper class as a measurestick, does this income allow.

Excellent comment Rosacrux Redux. This is the point.

[Ummon]

There is one little problem with your assumption and that's #2: you presume that everybody all men become "slaveholders" (as you put it...) which is definitely not mandatory. On the contrary, only those with need of workforce shall become "slaveholders" and thous the hole in that argument grows into one big Grand Kanyon... those who will own "slaves" (machines) will benefit but they will be precisely a small fragment of the population - those who today use paid labour.

The goal of politics is to regulate human behaviour, so that it benefits and not damages, human beings. Thus the problem, as all problems, can be resolved.

Ummon, it is not only that “low-end” workers are loosing jobs (and who cares for them because they are too stupid and not able to survive, as you suggest between the lines). Percentage of highly educated people is bigger and bigger every year, but there are not enough jobs for them. It is not possible to everybody be managers, engineers, doctors…most of the population must actually work. What we see now is shortage of high-educated jobs. Many college-educated people cannot find jobs according to their skills, and they are accepting much less paid jobs under their educational level, just to have a job.
Rise of the high educated population is much bigger then a demands for it. I even spoke with cheapf of my lab when I was in US about this issue. He is by the way, very experienced and honorable professor in one of the most prestigious US Universities and was involved in education, science as well as in “people resources” management at the university. He said it was far much, much easier to get job (as an assistant professor for example) at the University in 1970 then now. In the mean time, wages especially for lower rang stuff are lower and lower. No matters there are much more Universities and other high skill job positions in US now, then in those times. Moreover, it is situation in world leading economy; in the most of the world it is even much worse.
I am back in Serbia now, and no matter our economy is going up 5% every year, and we have huge international investments and boom of foreign companies, most of my friends do not work for what they were educated. They are forced to work long after-hours, and they are happy to have a job and much more above average wages but there are still miserable and they are practically voluntary slaves. Because there are thousands of University educated young people out there available to replace them. “Butter” from the milk is going to very tiny minority. It is more or less same in the most of the central and Eastern Europe and they are still above world average. In third world countries it is not even feudalism, it is new age slavery.
I was in my summer vacation in Egypt (which is on of the best African economies by the way)…and it is unthinkable what those poor people are ready to do for just ONE $.
PS. In the “times” of my mother and father, in early 70’, it was possible to get dissent job with high school, in Serbia, as well in US. Now, even with University degree, it is much harder…

I can only advise that you re-read my posts.

[imb39]

OK Stas (data taken from offical census in various years):

Source 1

Class 1 covers 'Professionals' while class 2 covers, broadly, 'Managers' so this can be seen as a measure of the 'middle class'. Because 'working class' occupations are generally defined as manual work, as more and more people worked in the services sector and in offices the proportion counted as 'middle class' rose steadily, from 14% in 1841 to 47% in 2001.

Source 2

Class 3 This class combines clerical workers and skilled manual workers. By some definitions, the first are 'middle class' and the second 'working class', but skilled manual workers generally had higher earnings than clerks. For some years, separate figures are available for the two groups.

Over the twentieth century, the proportion of all workers in the sector remained almost constant up to 1991, and the geographical focus was increasingly on industrial areas away from the south east, numbers in the London area declining and being increasingly focused into districts along the Thames east of London. The figures for 2001 show only that we have so far failed to identify the equivalent group within the latest census data!

After 1991, there was a sharp drop.

Source 3

These two classes cover semi-skilled and unskilled manual workers. In practice, this covers labourers, including farm labourers; domestic servants; and many workers in transport. In the 19th century, these classes included something over a third of all male workers, declining to a quarter in the mid-20th.

The percentage actually dropped to just over 20%, but over the last 10 years, it has risen to about 25%. Still less than historically recorded.

Ergo - the middle class is more dominant than in the past.

[Hanno the Navigator]

About the depreciation of labor thing: Indeed, when one differentiates between middle-sized corporations (hundreds to a few thousands of employees) and large ones (thousands to tens of thousands in the whole network - outsourcing tends to muddy the picture, but outsourcing is, if at all possible, of course done 'in the family', i.e. towards corporations under the same ownership umbrella):
In the middle range, there is high dependency on manual labor still. It is possibly a German phenomenon (the Mittelstand as this economic segment is called was always a fetishized thing over here), but from what I read, at least in Germany, this phenomenon is increased by a general tendency in this segment to make ad hoc decisions on asset development, like when to buy which machinery - there is a general reluctance to indulge in long-term strategic positioning, and thus, in Germany, these businesses tend to get out-competed very quickly.

At any rate, the comparative reliance on manual labor should be a global phenomenon. Large and largest corporations and corporate networks (stuff held by equity firms, banks etc) have developed a marked tendency to shift more emphasis on the financial market (what I like to call the fourth economic sector, after raw materials, manufactured goods, and services). In their position, they seem to conclude that they can make most money by betting on how others make money, which is a bit like Baron Munchausen pulling himself out of the bog by his own ponytail. Of course, this depends on the economic outlook, and the situation being as it is, small wonder we see such high volatilities (which is one of the most intriguing indicators, as it is perhaps the most everyday example of applied theory of complex systems currently in existence) like we're doing now (cf. last weeks' Dow behavior). the barriers put in pace after the Black Friday are to prevent something like the crisis of 1929, but whether they're up to what seems to loom aead only time will tell - even if they manage to prevent an acute economic collapse, they would still have to maintain a certain degree of stability and coherence of the financial markets which are not based at all on a primary item of exchange, like materials, goods and services which can be put to instant use, whether it makes sense or not, but on money; that is to say, an abstraction, in the first place, and on shares, the companies to which they trace back are worthless outside a preexisting economical framework. You can always do something with a lump of ore, a piece of paper or the services of another person, but money is just paper (and some 80% or so of it ist'n even that anymore) and a manufacturing plant is just idle machinery by itself. So the financial market is a good means for a corporation of a certain size to rake in cash without employing too many people - in fact, you can make loads of money by taking over a bankrupt company for a bargain, gutting it and selling the empty husk if you got the right gang for the job -, but the items that is traded on this market have no intrinsic value - all the millions on a bank account are worth absolutely nothing by themselves, they're even less than a greenback which can still be used as toilet paper or to roll a doobie, albeit it is of inferior quality for these prposes. Now, that is not a bad thing in itself - it is, as reality proves, entirely possible, but it demands certain desiderata, notably a viable economic framework, to function that the first three market sectors don't (Note that this is not a question of supply and demand. There is no intrinsic demand for another clonepop band either, though it can successfully be created as we know. It is more like the financial sector is metaeconomics; it has grown out of and depends on the first three ones). Thus,m the financial sector is lacking in intrinsic stability; it cannot prop itself up: if there is less means of making money, the opportunities to make money by betting on somecorp making more money than in the previous quarter are bound to fail.

Insofar, it will be interesting to see whether a chronic erosion of the financial sector will take part and how it will influence the makeup of macroeconomics. It is assuring to remember that the trade of goods and services with their ad hoc, primary value will obviously be influenced by any such development, but they will stay intact due to their intrinsic stability: if all the banks in the world went bust, the financial market would implode on a global scale, but it would not stop any person in the world from the desire to eat, drink and be merry (summing up nicely the first three sectors).

[4th Regiment]

Ummon, it is not only that “low-end” workers are loosing jobs (and who cares for them because they are too stupid and not able to survive, as you suggest between the lines). Percentage of highly educated people is bigger and bigger every year, but there are not enough jobs for them. It is not possible to everybody be managers, engineers, doctors…most of the population must actually work. What we see now is shortage of high-educated jobs. Many college-educated people cannot find jobs according to their skills, and they are accepting much less paid jobs under their educational level, just to have a job.
Rise of the high educated population is much bigger then a demands for it. I even spoke with cheapf of my lab when I was in US about this issue. He is by the way, very experienced and honorable professor in one of the most prestigious US Universities and was involved in education, science as well as in “people resources” management at the university. He said it was far much, much easier to get job (as an assistant professor for example) at the University in 1970 then now. In the mean time, wages especially for lower rang stuff are lower and lower. No matters there are much more Universities and other high skill job positions in US now, then in those times. Moreover, it is situation in world leading economy; in the most of the world it is even much worse.
I am back in Serbia now, and no matter our economy is going up 5% every year, and we have huge international investments and boom of foreign companies, most of my friends do not work for what they were educated. They are forced to work long after-hours, and they are happy to have a job and much more above average wages but there are still miserable and they are practically voluntary slaves. Because there are thousands of University educated young people out there available to replace them. “Butter” from the milk is going to very tiny minority. It is more or less same in the most of the central and Eastern Europe and they are still above world average. In third world countries it is not even feudalism, it is new age slavery.
I was in my summer vacation in Egypt (which is on of the best African economies by the way)…and it is unthinkable what those poor people are ready to do for just ONE $.
PS. In the “times” of my mother and father, in early 70’, it was possible to get dissent job with high school, in Serbia, as well in US. Now, even with University degree, it is much harder…