Ten years after the Great Recession, nothing’s changed

A decade later, the crisis that threatened to take down the global financial order seems like a bad dream. Now it’s business as usual.

image: Alt-M

In Great Recession, banking institutions creaked and groaned under the weight of flawed investments. Mohamed El-Erian, CEO of a large U.S. investment management firm phoned his wife and asked her to withdraw as much money as she could from an ATM because he feared the banks wouldn’t open the next day. A hedge fund manager sent an email to a journalist during the meltdown saying: “It feels a little like the end of the world.”

But the problems have been fixed, haven’t they?  Yohann Koshy, editor for New Internationalist magazine, is not so sure:

“The world almost did end. And everything stayed the same. Time was borrowed in the form of nationalizations, cash injections and money-printing: space for the financial sector to breathe. But the air is getting thin again (July/August, 2018).”

How we got here.

We went from a stable financial period -one of the longest in centuries- to one designed to fail. The post-war era from the mid-1940s to the early 1970s brought prosperity to everyone: workers and employers alike.

This stable economic period was engineered by the Bretton Woods agreement in 1944 in which a system of monetary rules were applied to the United States, Canada, Western Europe, Australia, and Japan. A key feature of the agreement was a stable U.S. dollar to which many global currencies were pegged. The value of the dollar was linked to a quantity of gold held at Fort Knox.

“This ‘gold standard’ forced discipline on the financial system: it was much harder for banks to create credit out of thin air,” says Koshy.

Under Bretton Woods, money was tied to the value of gold and economies were tied to the goods they manufactured. The U.S., already tooled to produce military equipment, switched to produce the world’s goods.

The U.S. dollar became so popular as a global currency that not enough dollars could be printed. President Nixon ended the gold standard in 1971.

This ushered in the era of financialization. With the dollar having no tangible value, economies also became more abstract. Wall Street made money from the production of goods in other countries.

A recession was avoided in the 2000s by the lowering of interest rates. Financial institutions were awash in money and they invested it in exotic and dubious things like derivatives, credit default swaps and collateralized debt obligations. And banks gave mortgages to people to buy houses that they couldn’t afford.

As the world staggered towards financial calamity in 2008, governments injected massive amounts of money into banks to cover their bad investments. Bailouts were given to the very perpetrators of the dubious investments. The chair of Goldman Saks announced that the biggest beneficiary was “Wall Street itself.”

Nothing has been fixed. What will happen the next time the system teeters towards calamity? “Whatever the answer,” says Koshy, “the blame must not be laid at the feet of the migrants, workers and the marginalized, but on those enabling, creating and profiting from a rapacious and crisis-prone financial system.”

As the air gets a little thin in the stratospheric world of finance, we can only hope that the wizards of exotic investments remember 2008.

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Canada’s Roma

The Romani people of Canada have been met with both fascination and suspicion.

image: from film “Opre Roma: Gypsies in Canada”

For more than a century, Canadians have been fascinated by the colourful bands of “Gypsies” that roamed the country. There was a circus-like feeling when they came to town. Dressed in colourful costumes, women danced, told fortunes, sold herbs, and worked as midwives. Men made and sold copper utensils and furniture. Gypsies must have been  a rare source of entertainment in frontier towns like Kamloops.

Historical entries of the Roma are brief says Professor Cynthia Levine-Rasky, author of Writing the Roma:

“In historical almanacs, most encounters are discussed only fleetingly, such as the report of the “Gypsy show put on in Kamloops in 1898, or in description of visitors who dressed ’like Gypsies,’ or in the numerous sightings of nearby campsites (Canada’s History Magazine, June/July 2018).”

While these Gypsies were never identified as Roma, the nature of their activities closely corresponded with the people. The Roma liked the myth that the name “Gypsy” projected, so it’s understandable.

“Gypsy” obscures the people’s origin. In Europe, the Gypsy label was given to the Roma because they were thought to originate in Egypt. The Roma never identified a homeland. Their origins were further obscured as they took surnames from whatever country they landed in.

We now know that the Roma originated from Northern India in the eleventh century. Their exodus to North Africa and Europe suggests they may have been refugees from the spread of Islam into India.

In Canada, the most common subgroups of Roma came from the United Kingdom, Russia, and Hungary. In some respects, the Roma were like other ethnic group. “Also like other groups, the Roma have been misunderstood or regarded with suspicion,” says Levine-Rasky. “But, unlike with people with other ethnicities, the myth of the Gypsy travelled alongside the Roma wherever they went.”

One attack on the Roma is seared into their historical memory. The Roma settled into a camp near Glace Bay, Cape Breton Island, in 1935. Women told fortunes in town and the men, who were skilled mechanics, did odd jobs.

In the middle of the night five drunken miners attacked the camp, intent on raping two Romani girls; Bessie and Millie Demetro.  A reporter wrote: “hardly a member of the band escaped the carnage that followed.” Their father, Frank Demetro, fired a gunshot into the air to scare them off. He was arrested for firing another shot that killed one of the miners. Demetro was taken to hospital to care for his injuries and placed under RCMP guard. Frank’s brother Russel, fearing that Frank would not survive prison because he was diabetic, admitted to the shooting. Russel was tried but acquitted on a plea of self-defence.

Canadian Roma commemorate the event with a song in which Frank appeals to his wife Kezha: “Kezha, de ma ki katrinsa te kosav a rat pa mande (Kezha, give me your apron to wipe the blood from me)”

But don’t look for bands of Gypsies roaming the countryside today.

“When we learn of their historical travails, however, the Gypsy myth is challenged, just as it is when we encounter the Roma in Canada today –a dynamic and pluralistic community numbering about one hundred thousand and encompassing citizens of many faiths, occupations, and statuses,” says Levine-Rasky.

 

Canadians support carbon pricing

Canadians, including business groups, support Trudeau’s proposed carbon-pricing plan announced Tuesday. So why are some politicians opposed? The short answer is politics, although games are being played by both sides.

image: Werner Antweiler

Recent polling from Environics Research shows that nine out of ten Canadians are concerned about climate change. And a majority support carbon pricing except in Alberta and Saskatchewan. Tony Coulson from Environics Research says:

“For many Canadians, it appears their concern about the consequences of climate change is strong enough that they’re willing to bear some cost to help stop it (Globe and Mail October 16, 2108).”

The feds say that they will collect carbon taxes from those provinces that don’t have a carbon-pricing plan and return the money directly to citizens of those provinces. Depending on how little fossils fuels they burn, they could get more back in rebates than they spend on the added carbon tax.

Opposition parties are calling it a vote-buying tactic in time for the next election.

Those opposing carbon pricing include Ontario Premier Ford. During his Alberta visit to bolster Jason Kenney, leader of Alberta’s United Conservative Party, Ford tweeted:

“I am proud to say that Ontario will stand with Albertans who oppose this unfair and burdensome tax on families and businesses.”

The Ontario Premier has allied himself with Saskatchewan Premier Scott Moe in opposing the federal tax plan. Manitoba also recently cancelled its planned carbon tax.

Carbon taxes are directly on the sources of carbon: 70 per cent of them from burning fossil fuels to heat our homes, generate electricity and for transportation.

Ford claims that carbon taxes take money out of the pockets of taxpayers. Not necessarily. A revenue neutral carbon tax such as the one that B.C. has doesn’t. Sure, we pay more for gasoline but receive an equal reduction in taxes elsewhere. As demonstrated in B.C., carbon pricing reduces greenhouse gases and doesn’t harm the economy.

If Ford wanted to take a conservative approach, it would be our carbon tax. A progressive approach would be to take the carbon taxes and directly invest them into sources of renewable energy.

Canadian businesses also support carbon pricing. The business-backed C.D. Howe Institute has recently come out in favour of carbon-pricing. The institute understands both the necessity and practicality of carbon taxes. C.D. Howe policy analyst Tracy Snoddon says:

“The politics of carbon pricing may have changed but the climate change challenge and Canada’s emissions reduction targets under the Paris agreement have not. The economics are also unchanged – carbon pricing continues to be the most cost-effective option for achieving emissions reductions across the country (Globe and Mail October 18, 2108).”

It’s disappointing to see politicians use the future of our planet as a political football.

Canadians want government action. For the first time in polling history, Canadians say that individual action is not working that governments need to step in.  “A slim majority now feels that voluntary action is not enough to address the challenges we face,” says Coulson.

Canadians are waking up to the fact that individual actions, like changing to energy efficient light bulbs, is not working. Only legislated policies will collectively accomplish what we individually wish for.

 

Canada’s first constitution of 1763

 

More than a century before the confederation of Canada in 1867, the Royal Proclamation of 1763 established a basis of government in North America. Peter Russell, in his book Canada’s Odyssey: A Country Based on Incomplete Conquests, calls the proclamation “the formal beginning of Canada’s constitution,” and adds:

King George III. Image: Wikipedia

“Accordingly, the Proclamation called for that essential institution of Anglo-American liberal government: a representative assembly. This plan of government reflected the fact that, in terms of constitutional and representative government, Britain was the most advanced European state of the day. …France was still an absolute, not a constitutional monarchy (p.29)”

It’s odd now to think of England as a model for government now, but at the time a progressive King George III empowered the colonies of North America to form government comprised of citizens empowered to: “make laws for the Public, Peace, Welfare, and good Government.” Colonial courts were set up as well for hearing “all cases, criminal as well as civil, according to Law and Equity, and as near as may be agreeable to the Laws of England.”

The force of the proclamation reverberated through the centuries.

The first shock wave was the revolution of the thirteen colonies of what is now the United States. They were not happy with the lines drawn on the map of North America by the King. Land west of the colonies as far as the Mississippi was assigned to Indigenous peoples. The thirteen colonies saw the proclamation as hemming them in from expansion to the west. Two years after the proclamation, the American Revolution started which led to their independence in 1776.

Treatment of Quebec had a better outcome. With the winds of independence drifting through the colonies, Britain decided to accommodate their new colony of Quebec. Wisely so, since Catholic French-speakers outnumbered the English. In the Quebec Act of 1774, French property and civil law was introduced and French-speaking Catholics held public offices.

Recognition of Indigenous land title took a little longer. Two and one-half centuries later, Canada is finally recognizing Indigenous entitlement laid out in the proclamation. Reactionary Canadian governments ignored the proclamation and proceeded with the subjugation and assimilation of Canada’s first peoples.

As one of the three pillars of the founding of Canada, Indigenous peoples were left out of the British North American Act in 1867. The French and English pillars were there says Russell:

“One of the first challenges for the infant Canadian federation was its relations with the absent pillar, the Indigenous peoples (p.163).”

Two centuries after the proclamation, patient Indigenous leaders reminded us of their exclusion. George Manual was one of those who rallied against the failed colonization of his people. As former chief of the Neskonlith band of the Shuswap nation and participant of the residential school in Kamloops, he collaborated with Michael Posluns in writing The Fourth World: An Indian Reality in 1974.

In a landmark court decision, against the wishes of the Province of B.C., the court ruled that Nisga’a territory had never been extinguished. We live on unceded Indigenous land in most of B.C.

The Royal Proclamation of 1763 is referred to in section 25 of our Constitution Act of 1982. And on the 250th anniversary of the proclamation in 2013 was celebrated in Ottawa with a meeting of Indian leaders and Governor-General David Johnston.

Now we’re getting somewhere.

 

The rise of populism in the attention economy

We only have so much attention to give and as such, it’s a valuable resource. Everyone wants our attention: social media, advertisers, politicians, family and friends. Attention is a limited resource and technology gobbles up at lot of it; just look at the number of people glued to their screens on any street or in any cafe.

Herbert Simon image: Wikipedia

Noble Prize winning political scientist Herbert A. Simon described the concept of the attention economy in 1971. The growth of information dilutes our attention. Simon says:

“What information consumes is rather obvious: it consumes the attention of its recipients. Hence a wealth of information creates a poverty of attention and a need to allocate that attention efficiently among the overabundance of information sources that might consume it.”

More recently, James Williams has researched how technology absorbs our attention. Williams is a doctoral researcher at Oxford University but before that he also spent 10 years working for Google. He believes that the liberation of human attention may be the defining moral and political struggle of our time.

Williams spoke to CBC’s Spark about the misalignment between the goals that we have for ourselves and the goals that our technologies would impose on us. Technology attracts attention that we would really like to apply elsewhere. He told host Nora Young:

“The things that we want to do with our lives, the things that we’ll regret not having done, the things that I think technology exists to help us do aren’t really represented in the system and aren’t really the sort of incentives that are driving the design of most of these technologies of our attention today (June 1, 2018).”

Seen from the goal of attention-getting, U.S. President Trump makes a lot of sense. He does whatever it takes to get our attention because he understands the impact that it has on his ratings. The content of his Tweets may be sheer fabrication but that’s not the point. His years as a TV showman taught him the effect that outrage has on tribalism. What is factually true is irrelevant.

“This is what people didn’t realize about him [Trump] during the election, just the degree to which he just understood the way the media works and orchestrated it,” says Simon. “But I don’t think there is going back, as long as these media dynamics remain as they are. In a way, I think we have to be more concerned about what comes after Trump than what we have with him.”

Trump is not interested in unifying the country –he wants to divide it so the largest tribe is his.

Research published in the February issue of American Sociological Review reveals the way Trump supporters view his acknowledged dishonesty. Participants in a study were told that one of Trump’s tweets about global warming being a hoax had been definitely debunked –that global warming is real. Trump supporters saw the tweet, not as literal, but as a challenge to the elite (Scientific American, September, 2018).

Canadian philosopher and public intellectual, Marshall McLuhan, foresaw the impact of technology:

“We shape our tools and thereafter our tools shape us,” and “The new electronic independence re-creates the world in the image of a global village.”

Four decades later, McLuhan might have added: “Populism is the politics of the global village.”

Three profiles of opioid users

The fish-bowl lives of drug users on the streets of downtown East Vancouver provides an easy, but distorted, window to drug use. That picture is as distorted now as it was 139 years ago when B.C.’s second premier, Amor De Cosmos, headed a commission to investigate opium use.

The window to most drug overdose deaths is closed. Typical victims are single men, in the prime of their life, who die alone from opioids containing fentanyl according to a report from the BC Coroners Service released last Thursday.

Michael Strange. image: Globe and Mail

Even reports of typical deaths are somewhat distorted. For some opioid users, the drug is a godsend. Take the case of Michael Strange. He injured his back while working as a cameraman and found opioids to be the only treatment that provided relief.

“I’ve tried so many different things for my pain,” said Strange. “People say, ‘Have you tried acupuncture?’ Yeah. I’ve had two different kinds of laser therapy. I had doctors and friends say I had to try marijuana. I got the vaporizer and it did nothing for my pain (Globe and Mail, September 7, 2018).”

It wasn’t easy but Michael Strange finally found a doctor who would treat him. Many doctors were “running scared” because they didn’t want to be seen to be contributing to addiction. Now his pain specialist gives him a two-month prescription and before renewing, asks: “Michael, how are you? Are you OK with the drugs? Do you need more? Do you need less?”

Self-medication turned deadly for Chris Willie, a university lecturer with a PhD in environmental physiology from UBC Okanagan. He wrote memoirs about his recovery from fentanyl addiction but he died from an overdose before they were published. With the approval of his family, his memoirs were published in the September, 2018, edition of the Walrus. He describes his mental pain as a child and the calm he found in taking dangerous risks:

“I have never excelled at coping. I was that infant child who hammered his head on the ground when frustrated by anything at all. It must have been embarrassing to parent the son with the ever-present forehead scabs. Perhaps I found it soothing, because, thirty years later, I still find serenity in chaos and derive calm from risk. By fighting to live through near-death situations, I could find the high I needed to briefly escape the pain.”

Like Michael Strange, Emily Wharton lived a productive life with opiates. The twenty-year old opium smoker from Victoria, told a House of Commons Select Committee on Chinese Immigration of her use. The federal committee was initiated by John A. Macdonald in 1879 and headed by B.C.’s second premier, Amor De Cosmos (a.k.a. William Alexander Smith).

Back then, the stereotypical opium user was Chinese. They lured good white women into lives of depravity in opium dens. The real agenda of the committee was to rid Canada of Chinese immigrants.

Wharton’s testimony 139 years ago is recorded in Dan Malleck’s book, When Good Drugs Go Bad. She told the committee that she had been using opium for four years and suffered no ill effects. Wharton testified that opium’s “somnolence and complete rest” left her productive. Chinese men in opium dens treated her well and she objected to the characterization of the dens as depraved. She suggested that if the government legalized opium, “one need not have to come into such holes as this to smoke (p. 102).”

Medical-grade opioids are not the problem. The social stigma of drug use that drives users to overdose, and the lack of pain-treatment specialists, leads mostly young single men to self-medicate, and to die, alone.

How Russia uses social media to stir conflict

Russian President Vladimir Putin has unleashed an army of trolls and bots. His bad intentions go beyond revenge and interference in U.S. elections. Recently, postings from his motley crew have resulted in deaths due to a measles outbreak in Europe.

image: Rantt

Putin never forgave Hillary Clinton for the mass protests against his government in 2011. He was convinced that Clinton was seeking a “regime change” in Russia. Hacking of the Democratic National Committee’s email server threw the Clinton campaign into disarray. Michael McFaul, U.S. ambassador to Moscow until early 2014, commented: “One could speculate that this is his moment for payback.”

Canada is not immune. Putin doesn’t like Canada’s Foreign Affairs Minister Chrystia Freeland. As a reporter, she called him an authoritarian, an autocrat and “really dangerous.” Months after she became minister, Putin banned her from Russia. Canadians have been targeted through Facebook. Russian trolls befriend unsuspecting users to spread their propaganda.

To be clear, I like Facebook and use it daily but I’m very careful about friend requests. I personally know most of my contacts and others are friends of people I trust. But Facebook admits that hundreds of millions of others have been sucked into the Russian vortex. If you’re not sure, check your Facebook account here for any Russian agents. If the box is empty, it doesn’t mean that you weren’t exposed, it just means that you didn’t engage them.

The motive of Russian trolls is to agitate and divide countries with the hope that governments will be thrown into chaos. That’s easily done in the U.S. with a president that refuses to admit what everyone knows: the Russians interfered in his election.

Russian trolls are responsible for the public health misinformation that led to a measles outbreak in Europe this summer where cases doubled over 2017 and 37 people died.

Heidi Larson, London School of Hygiene and Tropical Medicine, told CBC Radio’s The Current about her research. Here’s the exchange between CBC host Piya Chattopadhyay and Dr. Larson:

Piya: “And specifically I want to ask you about Facebook because as you know Facebook has been accused of contributing to misinformation — in other arenas, in other contexts. How has Facebook contributed to misinformation about vaccines?

Heidi: Oh I think it has contributed significantly. But these new tools: social media, Facebook, they are organizational tools, they’re not just about spreading information — they’re empowering groups of people not even geographically local across different locations to organize into groups. And that kind of organizational power that these tools have given some of these anti-sentiments is I think as concerning as the negative sentiments.”

The malicious posts have been traced back to the Russian troll farm, Internet Research Agency.

Researchers found that trolls were 22 more likely to tweet using a hashtag referencing vaccines than the average user. Echo chambers embolden Facebook users into thinking their bizarre thoughts are valid. It turns out that when just 25 per cent of people in your social media network are against vaccination, it can delay or prevent vaccination –even for those who previously were ready to vaccinate their children.

Facebook and Twitter are working remove agents who want to undermine democracy. Meanwhile, we need to be vigilant.