THE GREAT RECESSION: Plus ca change

I was watching a 2010 documentary called Inside Job the other night. It is the story of the worldwide economic crisis of recent years, and particularly about the bad guys in the US system who made it happen. Of course, that is a very particular view, because it was happening here in Europe too, and we had our own bad guys. And it wasn’t just bad guys, as the film made clear. It was also a herd mentality.

The main point, though, was that it happened because the

financial system had been deregulated from the 1980s onwards, leading to a series of increasingly big financial crises. And in the US, despite what has happened, no-one has been prosecuted and new regulation has not been brought in to stop it happening again. I had not realised this, and it is shocking. Wall St has become too big and too powerful for legislation to be politically possible.

Well, almost. I did my research afterwards, and it seems the Dodd-Frank Bill of 2010 (too late for the documentary) was intended to produce the greatest ever reform of the financial sector. But 3 years later, less than half of it has been implemented, and according to an 11 part series in Forbes Magazine, it is not sufficient to prevent another meltdown. Key sectors have not been reformed, and there is no plan to do so in any effective way.

Eg the banks that are Too Big To Fail (creating issues of moral hazard) are now bigger and more complex than in 2008, and the retail and investment arms have not been ring-fenced, endangering ordinary customers and small businesses. The ring-fencing requires international agreement for reasons of competition, but the US is usually able to get what it wants, and Europe in this case seems quite willing. The problem with the US megabanks is worse than it ever was.

Unregulated derivatives trading also leads to crises, and there is a loophole in the new regs which would allow the megabanks to continue their trading abroad. It is being fought ferociously, and it’s not clear who will win. But the megabanks tend to.

(I read a very good book on the financial crisis, ‘How do we Fix this Mess?’ and the author, Robert Peston, was astonished in 2006 to find that the boards of banks did not understand their derivative trading arms, let alone monitor them. This was when he began to suspect a major crisis was on the way – and the BBC (for whom he is the Business Editor) tried to stop him saying so!)

Five years after the meltdown, and they are still only starting to talk about higher capital requirements for banks.

There has been no bill to reform the credit-rating agencies, who were responsible for giving AAA ratings to junk securities.

Nothing has been done to reform the mortgage providers Fanny Mae and Freddie Mac, who played a key role in the sub-prime housing crisis.

There seems to be no prospect of the regulators required to oversee any new rules being given the extra funding to do so.

So there it is, a dismal list.

Deregulation has made the financial sector vastly more profitable and therefore more powerful, so maybe it is too late to do much (though the European Parliament has passed some new financial regulations.) But to what degree is it really creating wealth, and how much is it just sucking wealth from everyone else? After all, the sector doesn’t actually MAKE anything. Sure, it enables, and that is good, it enables business ventures to get the loans and insurance they need, for example, and a host of other things. We really need this sector. Let’s not blindly knock it and demonise it, which too many people seem inclined to do. There are such people as bankers and fund managers who are good guys doing necessary jobs.

But all these extra profits of recent decades…  Before deregulation, the American economy expanded steadily for 4 decades. Since then it has continued expanding, but the gap between rich and poor has widened, there have been a series of economic crises and now, for the first time, the younger generation of Americans has lower economic expectations than its parents’ generation.

So has deregulation done anything other than undermine an economic prosperity which would have continued anyway, yes with the odd recession, but you expect that? Look at all the people who have lost out, the home-owners in the US who should never have been sold loans in the first place and who have therefore lost everything.

When Obama first became President, the money-people he appointed were all establishment high-flyers who had been intimately part of the system that led to the crash. This sent the immediate message to Wall St that nothing was going to change, and it hasn’t. Obama was first elected under a tsunami of reforming rhetoric, but one of his first acts was to show how conservative at heart he really is.

So where does this leave the astrology of the Great Recession? The Great Depression, which occurred under the last Uranus-Pluto Square, was also a result of lack of financial regulation. And there was the destruction followed by rebirth which is so characteristic of Pluto. A more regulated and therefore more stable financial system was created.

This time, however, no such Pluto rebirth seems to be happening. Yes, there is a rebirth in the sense that we seem to have climbed out of recession. But it is the same old system, so it is not a true rebirth. So next time there is a hard outer planet configuration, we can probably expect another crisis. Maybe not as big as this one. But still a crisis, caused for example by another housing bubble, the sort of thing the Fed used to lean against, any sign of ‘froth’. Watch out for the Saturn-Pluto conjunction in 6-7 years’ time. Or even Saturn square Neptune in 2 years time.

There are of course all sorts of dimensions to this Uranus-Pluto transit other than the economy. Like the ‘Arab Spring’, which could take decades to work through, and who knows which way it is going to go. Egypt being paradigmatic – desires for democracy vs desires for a theocracy vs the traditional certainties of the army in charge, with the West putting in its oar along the way according to its own interests.

But economically, it is interesting that you can have a transit of this magnitude – Uranus square Pluto, hard aspecting the Suns of nearly all the major powers (unlike the 30s)  - and you end up with the same system. At least, in the US. In Europe, we have had the Eurozone crisis, which is still to be resolved, but which was probably always about Germany being ultimately willing to save the situation but having to pretend otherwise. Moral hazard again. Angela Merkel’s masterly fudge.

We are coming up in November to the 4^th of 7 squares between Uranus and Pluto, so we are at the midpoint. The worst seems to be over, and the rest of the transit looks like it will be a working through of what has already happened.

As I say, the classic Pluto transit involves death and rebirth. But the rebirth involving a step forward usually needs some kind of consciousness brought to bear for it to happen. And this is difficult on a collective level. The US managed it with its financial regulations of the 30s. But Germany didn’t manage to move forward from the Great Depression, it just spiralled downwards.

With the current square, Europe seems to be moving forward in its currency crisis, though there is plenty of fudging left to do, and it has left Germany all-powerful. But the financial system itself that led to the crisis is still in place. OK, Europe has passed some regulations, but we can’t separate ourselves financially from the US.

So Uranus-Pluto has provided a tremendous shock to the financial system. But the ideology which led to de-regulation is still there, and for the US I guess it is tied up with its broader resistance to what it sees as ‘big government’. This in turn goes back to the rebellion against authority that occurred at its inception, and which is actually still an issue for it, expressed by the Sun-Saturn Square in the US Chart.

The thing is, you have to have government, and if the government itself isn’t doing a complete job, then others step in, in a less conscious sort of way. So you end up with big business and Wall St to a large extent ruling the US, instead of Congress doing so. (Last week there was the news that “former head of the SEC enforcement division Robert Khuzami has taken a $5 million-a-year job with Kirkland and Ellis, where he will no doubt spend a great deal of time defending Wall Street firms against SEC charges.”)

The US is at a point in the Uranus-Pluto square where it can still make choices, for the exact aspects to its Sun-Saturn will not occur until 2014-15. And then after that, some years down the line, it will have a Pluto Return, a reckoning of who holds the power in the US.

But looking more globally at the Uranus-Pluto Square, there is a death and rebirth going on, in the sense of a shift in the global balance of power away from the West and towards the BRIC countries (Brazil, Russia, India and China), particularly, for now, China.

So in that sense there is a rebirth for the West gradually coming about as Uranus-Pluto completes over the next few years – a return to prosperity in the old way, but with a key shift in of global power, pointing the way to a further diminution in the years to come. And hastened by the decadence of a system which has been wealthy for so long, that it has forgotten it needs to earn that wealth, a system which in important ways benefits the few at the expense of the underlying health of the economy.

Astrology and Complex Systems Theory

Below is a talk by Bernadette Brady on the theory of Complexity and how it can provide a philosophy compatible with astrology. Here's the address in case the thing below doesn't work: http://youtu.be/XgiZZFEWndc

Complexity arises when a system can't be reduced to the simple mechanistic models that science usually uses. Whether or not these systems - such as the weather - are ultimately deterministic, if only you have enough information and the right theories - is a matter of debate. The Nobel prize winning Chemist Ilya Prigogine, who is known for his work on complex systems, said that "The more we know about our universe, the more difficult it becomes to believe in determinism."

Also of interest is the idea of Emergence, which is the arising of complex systems out of simple ones. The way that new properties appear that do not seem to be explicable purely in terms of the interaction of the simpler components. Again, this a matter of debate. I call this characteristic Uranus, the creative principle, where new elements emerge in your life that you could not have thought of and that are not just a re-arrangement of the old.

Saturn, Neptune and the Nature of the Cosmos

For us tiny human beings, the Earth element appears solid, massive and at times awesome. But how does it look from the point of view of the universe itself? It appears as a spread of tiny fairy lights, with vast distances between each light. And these lights are fragile. If they become just a bit bigger than tiny, then they burst in a brilliant flash that travels for thousands of years.

Or they implode into nothingness, like the opposite of a bubble popping: they become portals into other universes around which other fairy lights dance.

So unless you are miniscule like we are, then matter appears as a very fragile thing. Matter is made up of mainly empty space anyway, and it doesn’t take much to squash it. And once it starts collapsing, if there is enough of it, it collapses until it is nothing, it occupies no space.

From our point of view, matter appears as Saturn – solid, workable, reality itself, and governed by laws such as gravity. From the cosmic viewpoint, matter appears as Neptune – delicate, ephemeral, the temporary dance of a greater reality, and attracted to itself not by gravity but by love.

Saturn and Neptune have a hard time understanding each other. Working well together, the Imagination (Neptune) can find Form (Saturn), can even earn a living! But Neptune often doesn’t want to know about such ‘mundane’ realities, or sometimes about any reality at all, while Saturn often thinks that only that which is measurable is real. And it is usually Saturn that wins out, seeing Neptune as at best a hobby, and if not, then needing to be confined within a 9 to 5 framework.

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Both are needed. But Neptune is an outer planet and Saturn is not. Saturn is under our conscious control, he gives us the ability to work and to shape our lives. We have no control over Neptune, he embodies the principle of surrender to a divine order, of being a vessel (Saturn) for that greater reality (Neptune). If Saturn decides to be boss, which he easily can, Neptune will still come through, but it will be messy. The aftermath of the Iraq War took place under an opposition from Saturn to Neptune, and it was a mess, a continual massacre and political chaos with no clear way forward. That is what happens when you push through an idea (Saturn) without listening to your intuition and to those who have another viewpoint (Neptune).

As human beings, we have the viewpoints of both Saturn and Neptune. During the day, we are Saturn, bending the material world to our will. At night, we rest, and the faery lights come out, and when we close our eyes, we dream. And we carry those dreams, and the influence of the fairy lights, into our daily life. There is a balance. In this way Saturn and Neptune come together, often without Saturn knowing.

Astrology, Wikipedia and Jimmy Wales' Objectivism

A year or two back I cancelled my donation to Wikipedia because of what it said in the introduction to its Astrology entry. It said this:

While astrology may bear a superficial resemblance to science, it is a pseudoscience because it makes little attempt to develop solutions to its problems, shows no concern for the evaluation of competing theories, and is selective in considering confirmations and dis-confirmations.

It was those words “it is a pseudoscience” that pissed me off. Not “some consider it to be a pseudoscience” which is fair enough, because some people do consider it as that, that is a fact that needs to be in the article. No, it IS a pseudoscience.

It would never occur to me to attempt to evaluate astrology ‘scientifically’. Why would I apply that very particular means of acquiring knowledge to a craft that works in a very different way? It would be like calling novel-writing pseudoscience, because the novelist in his/her presentation of psychological truths “shows no concern for the evaluation of competing theories, and is selective in considering confirmations and dis-confirmations.” It would be ludicrous. Positively Procrustean. Why haven't I thought of that before? The story of Procrustes has become a guiding myth for science at its worst.

Anyway, I objected, and others had objected before me, but there seemed to be nothing to be done. I was quickly banned from editing the page. Control of the astrology page was in the hands of non-astrologers.

Then I noticed recently that the entry had been changed to:

“Astrology has been rejected by the scientific community as having no validity or explanatory power for describing the universe (see pseudoscience)….”

It drones on after that, but the essential point is that astrology no longer IS a pseudoscience, it is just seen as such by the scientific community, which is fair enough. So I was very pleased to see that change had been made.

I don’t know what brought this development about, but it comes down to editorial integrity. Presenting one point of view as fact and ignoring others shows a lack of editorial integrity, and it should never have happened.

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I think it shows the extent to which in our culture the scientific point of view has come to be seen as the only possible point of view, that its findings are the objective reality. But the fact that the entry was changed also shows that there are counter-currents in our culture that are listened to. It gives me hope that we are not entirely in the hands of the zealots, that there is still room for liberal thinking.

In a way, the intro to the astrology entry has become quite balanced. As I want to emphasise, these criticisms of astrology by science do need to be in the article, as a matter of editorial integrity, because there are people who make such criticisms. It is simply reporting the facts about the various viewpoints, which is the job of an encyclopaedia. Rather than to take sides.

Which, if Wikipedia were to be consistent, should also apply to the entry on Evolution. In the US, for example, there are many Creationists who do not agree that evolution has occurred, and as a matter of integrity this needs to be stated in the intro to the article. An important cultural current has been forced out by the editors into what is almost a footnote at the end, and subject to a stream of counter-argument. And there is no mention of scientific criticisms in the main article, such as the gaps in the fossil record and the evidence for Lamarckianism.

So you can see the broader cultural battle that is reflected in the pages of Wikipedia. It is not, to emphasise, about the validity of science. It is about the attempt by science to forcibly exclude any viewpoints other than the ones accepted by its own establishment. Which I am sure many Creationists would also do given half a chance. There are probably astrologers who would as well! There will always be groups of people in any culture attempting to do that. In my view, the extent to which a culture is able to resist those pressures is a measure of how civilised it is.

Jimmy Wales, the founder or co-founder of Wikipedia (depending on whose viewpoint you take!) is philosophically a staunch ‘Objectivist’. He claims that he does not push his philosophy onto others or onto Wikipedia. And maybe he doesn’t. His stroke of genius was to create an encyclopaedia that anyone can edit. Up to a point, as I found. Who would have thought it could succeed to any half-way decent standard? The joke goes that the problem with Wikipedia is that it only works in practice. Rather like Astrology.

Objectivism is a philosophy created by Ayn Rand which maintains that “reality exists independent of consciousness, that human beings have direct contact with reality through sense perception, that one can attain objective knowledge from perception through the process of concept formation and inductive logic, that the proper moral purpose of one's life is the pursuit of one's own happiness (or rational self-interest), that the only social system consistent with this morality is full respect for individual rights embodied in laissez-faire capitalism….”

Ayn Rand elsewhere describes reason as an absolute.

I disagree with, or at least would strongly qualify, all of the above. (In fact I think it's nuts and I don't know where to start unpicking it, but that in itself isn't an argument!)

So Objectivism seems to provide the philosophical backing for one-sided rationalism, fundamentalist science and capitalism at its worst. What is in many ways the modern status quo. And Jimmy Wales has further said that his personal philosophy is firmly rooted in reason and he is a complete non-believer. His beliefs are central to him.

So to my mind it is as if Wikipedia has been set up by, say, a firm Catholic who does his best to keep his views out of the project.

 

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Wales has a Mars-Jupiter conjunction in Cancer in the 3^rd. So his beliefs (Jupiter) are outwardly rationally based (3^rd house) but inwardly emotionally held (Cancer) and pursued assertively (Mars). Jupiter rules his 8^th House of shared endeavour, which is Wikipedia. So it is a forum for his beliefs, whatever he says.

However much Wales maintains he does not push his beliefs on Wikipedia, the attitude we find when it comes to science vs the non-rational arts and crafts speaks otherwise. What happened to astrology was pretty extreme and had no place in what was supposed to be an encyclopaedia, and it was exactly what you would expect from someone who holds to rationalism as a religion.

Of course, Wales didn’t write the article or probably even read it or even know about it. But it is not going to be his first priority to ensure that subjects for which he probably has little respect get a fair hearing. And if he doesn’t know about the Evolution article and its absence of critical perspectives, I would call that culpable. It’s too big to ignore.

So even though I choose to believe him when he says he doesn’t push his philosophy on others – and it is part of his philosophy not to do so – it is psychologically naïve of him to think that it doesn’t influence Wikipedia. Even if it is just through what he ignores.

Wales’ one-sided rationalism is part of a one-sided rationalism in the wider culture. So I expect to see that sort of bias in Wikipedia. In the case of Evolution, it is not just the religious crowd who are left out. It is also scientists who do not agree with the mainstream views: they are shunted off to another article altogether, ‘Objections to Evolution.’ And that is a very conservative thing to do.

So Wikipedia is intellectually conservative and one-sidedly rationalist, even though as a project the editing process is wonderfully radical, and gives hope for the standards that collectives are capable of. What has happened to astrology on Wikipedia is paradigmatic of the bias within the project and within the wider culture. But the intolerance with which it was being treated has softened, and that is also grounds for optimism.