Production and Plunder

In virtus, libertas

The single most important step in the process of crisis resolution is recognizing that you are in one.

The declaration of crisis is the necessary door the passage through which marks the beginning of action and urgency to address the challenge and attempt to avert disaster. With that declaration, everything changes: priorities shift dramatically. What was deemed important five minutes ago, becomes - is - irrelevant now. The value of time increases sharply too: what was an endless, free commodity five minutes ago, becomes a precious resource to be husbanded. Purpose snaps into perspective: a mess of conflicting objectives crystallizes rapidly into a single overriding goal. In other words, everything changes in the instant of recognition of the true nature of a situation and its demand for action.

In business, in my experience, crises develop through three phases: crisis of strategy, crisis of profitability and finally and terminally a crisis of liquidity. I suppose that individuals run through a similar gamut, especially from a personal economic perspective, true to Ernest Hemingway’s description of a how he went broke “Two ways, gradually then suddenly.”. I am unsure of whether the same applies to nations and even less sure of the process of crisis and terminal entropy of civilizations, but I am pretty sure that I have experienced my “come to Jesus” moment in terms of viscerally comprehending that what we so fondly refer to as Western Civilisation is in just such a crisis and, obviously, that changes everything.

Coming of age in the 1980s and charting a professional course, albeit not a very elegant one, through the financial industry and business, I and those colleagues, friends and mentors with whom I talked and ruminated on the future, would ask ourselves, explicitly sometimes and more often implicitly, how the constant compounding of national levels of debt and general levels of indebtedness was going to end. Everybody knew that at some stage it would have to, but it was a spurious line of conversation to try and figure out when. The quotation “If something cannot go on forever, it will stop” by William Stein is probably the most over-used one of the past three decades, but is as applicable now as it was when I first heard it at the end of the glorious decade of the Eighties. William White in a policy paper published by the Council for Economic Policies wrote

“If something cannot go on forever, it will stop.” This famous observation was made by Herb Stein, Senior Fellow at the American Enterprise Institute. It became famous largely because it was just that, obvious. Yet, what is no less obvious is that public policy is commonly based on a wholly contrary assumption, that the future will be like the past, more or less. This is deeply unfortunate since many of the most important systems on which the future of mankind depends are evolving in an unsustainable way. They threaten to stop. Global economic, political, environmental and health systems are all showing clear signs of stress and prospective breakdown. The Four Horsemen of the Apocalypse can be clearly seen riding, purposefully, in our direction.

These challenges can be overcome, but to do so will require a brutal clarity about the seriousness of the problems we face, and then general agreement about three practical issues. First, what are the challenges to sustainability that are already at work, or can already be confidently anticipated as posing future challenges? In short, what path are we now on? Second, what kind of a sustainable society, made up of systems of systems, do we wish to migrate towards. In short, where do we wish to go? Third, what practical steps will be required to get there from here? This last challenge encompasses, not only the identification of what should be done, but also requires overcoming the political difficulties of making required changes actually happen. ~ William White (emphasis mine)

Probability of that last point being resolved in a way which produces a genuinely positive outcome is zero. Just look at how Germany - one of the most advanced societies in the world - is currently tackling its energy crisis (with thanks to Doomberg, Irina Slav and more recently Euggypius here on Substack for best in class running commentary on that issue).

My implicit default assumption has always been that a continuation of the status quo, the more-or-less free world in which we (I) grew up, was destined to continue, well, forever and that the problems which appeared to be insurmountable or at least insoluble, were in fact going to be solved, probably by people with a higher level of comprehension and a deeper understanding of the alternative courses of action than I. Contemplating a decline and fall of the entire Enlightenment civilisation construct within which our prosperity has evolved to its current level of sophistication was a consequence I never really allowed myself to explore and certainly not articulate as it seemed both ludicrous and and possibly even deranged, quite apart from the fact that putting a timer on that decline and then extrapolating consequences and courses of action from it was frankly impossible.

I have had a few constants in my inner life, tenets if you will that have always been true, no matter how vaguely I might have been able to articulate or defend them. I have always valued kindness highly and I have always had a ferocious dedication to a loosely defined concept of personal freedom. I loathe being told what to do and demand full responsibility for my choices and outcomes. I have written here before that my gradual slide towards a Libertarian philosophy from a small-c conservative starting point has been accelerated by the events of the past four years, having been initiated in the years 2007 -2009 by the Great Bail Out and the wholesale overriding of the market cleansing mechanism in favour of statist solutions. I am not sure I could have adequately described, let alone defended, the principle tenets of the Libertarian position, but as I discovered it for myself and immersed myself in it, I found those principles highly resonant with my two constants of kindness and personal freedom.

Adopting a libertarian philosophy is probably the most intellectually invigorating exercise I have ever undertaken, as it requires me to deconstruct almost every single strut of commonly held precepts of how a “civilised” society must be formed and comprehend the world in which we live and the institutional constraints that have been imposed on us from first principles up, battling my way through the increasingly hysterical “whataboutery” cries of the defenders of the status quo. “What about roads? What about old people? What about health care? What about police?” Drinking deeply from the Libertarian cup means coming up with answers to those and a hundred other questions that those who would happily burn all Libertarians at the stake for questioning the orthodoxy of the nation state and its raison d’etre hurl at us. When listening to (or enduring) the brickbats I am reminded of one of Margaret Thatcher’s favourite poems from Charles McKay entitled “No Enemies?”

You have no enemies, you say?
Alas! my friend, the boast is poor;
He who has mingled in the fray
Of duty, that the brave endure,
Must have made foes! If you have none,
Small is the work that you have done.
You've hit no traitor on the hip,
You've dashed no cup from perjured lip,
You've never turned the wrong to right,
You've been a coward in the fight.

~Charles McKay

In his truly outstanding and immensely readable book “Plunder versus Production” (2017) Paul Rosenberg describes the genesis of our economic and political systems from their very beginnings some 8,000 - 10,000 years ago and draws a compelling narrative arc between then and now. His basic premise is that our species has evolved through its ability to generate surplus, defined as produce over and above the immediate needs for survival. This surplus allowed primarily for the division of labour and for specialisation which in turn increased productivity and created more surplus. Building on this he goes on to describe how the process of farming - extended to other areas of production and creation of goods - led inevitably to storage and the existence of storage to plunder.

By ancient standards, these farmers were very rich. And while our farmers were happy living cooperative, productive lives, there were others who operated, not by a cooperation model, but by a plunder model. Our farmers were now immobile, and stationary targets are easy to hit. Furthermore, sedentary people are not well-suited for combat. They made easy victims. The first plunderers were the nomadic hunters and herdsmen described previously. At some point they expanded into new areas and discovered that rich, stationary farmers were easy to rob. The consciences of these people were informed by sky gods who imposed power from above and by clan groupings that featured dominance, submission and structure. They were emotionally suited to plunder. Furthermore, these people had the necessary skills for rapid movement and killing; they hunted, captured and killed mammals regularly. They would also have resented the prosperity of the farmers, as it made them look second-rate, something that would not be permissible in their hierarchical, “we must be the head and not the tail” view of the world. These nomads could easily remove the spoils of conquest, either to a safe place, or simply to the next settlement for the purposes of barter." ~ Plunder versus Production Paul Rosenberg (2017)

More importantly

Before long, however, the looters developed a third option: Steal only a limited amount, not enough to drive the farmers away. This way, you can work the same ground, as it were, for life. Thus the first rulers were born. Governance began as persistent theft, with hierarchical nomad groups sustaining plunder at a level that was low enough for the productive farmers to accept their rulership with a limited level of resistance.[13]" (from "Production Versus Plunder" by Paul Rosenberg) (Emphasis mine)

And then

Although the first instances of rulership were mostly naked impositions of force, an ethic was later created, saying that the commands of the gods, if followed, would assure safety and health. Furthermore, a priesthood was added to the equation. These first public intellectuals promoted a theology in which the king played an important role. Thus rebellion against the ruler became rebellion against the gods." (from "Production Versus Plunder" by Paul Rosenberg)

You get the picture.

Our entire “history of civilisation” has been a battle between the productive and the plunderers, punctuated by phases (most notably 1200 BC and 500 AD) in which the plundering classes’ superstructures collapsed under the weight of their own inconsistencies leading to so called Dark Ages, phases in which systematic plunder receded and which individuals and communities thrived creatively free from oppression and the requirement to send their surplus to some central authority to be redistributed and “invested” for the public good or more precisely to fatten the coffers of the Ueber -Plunderers. It is amusing to me to consider that the description of “Dark Ages” - in which there was no comfortable narrative thread spun by one apex predatory caste - was in fact the very opposite of what was actually the case, namely phases in which individual enterprise, creative chaos and inventiveness flourished as the heavy organising hand of the plunderers was, nolens volens, removed from human activity.

The establishment of America and the Glorious Experiment of a system of self-governance based on natural rights and the provision of a very limited central government fully in service of the individual and their right to pursue happiness in liberty, was a marvellous exception to the cult of plunder which had held sway for the previous millenia of our conscious existence. Unfortunately and despite the very best efforts of the framers of the Constitution, statists and centralisers were at work from the very start of the project, beginning with Alexander Hamilton and continuing with increasing boldness throughout the 19th Century until the United States of America and its enormous rapacious imperial federal government emerged to centralise the plunder of the largest single productive society ever to exist on the planet. It is a testament to the unstoppable power of the free market system and the idea of liberty and the free individual that it has continued to plough a deep furrow of productivity even whilst being saddled with increasing burdens of plunder over the past 80 years in particular.

Rosenberg writes - and this the moment for me in which my comprehension of the crisis unfolding crystallized -

“as surplus remains in the hands of the people who created it, civilisations arise and grow in a more less distributed fashion. We have also seen that when surplus is redirected to a central point, that civilsation travels a downward path….

This forceful removal of surplus was a crucial step and one that is difficult to overstate: It destroyed the expansion mechanism of Western civilization. By the mid-20th century, Western Civilisation no lo nger functioned in its traditional form. Many aspects of the culture conditioned, but its core principle had been replaced with an opposing principle….

From the time permanent income taxes were instituted (1914 in the US) a new surplus mechanism operated. The expansion mechanism of Western civilisation had been supplanted. Without returning to it or replacing it with something better, Western civilisation will end.

~ Paul Rosenberg Plunder versus Production

The pain, frustration, visceral revulsion that many of us are feeling as previously sacrosanct constitutional guarantees and standards of normative behaviour are dismissed as nothing more than irritating impediments to the imposition of authoritarian will on an embattled and largely apathetic public, is a direct result of the abandonment - at first gradual, now sudden - of “the expansion mechanism of Western civilisation” and its replacement by a system wholly opposed to liberty, free markets, personal responsibility, privacy, common law and the Christian ethics that underpin it. I mention the latter for the simple reason that flourishing societies are only possible if each individual has the civilisation within themselves and not imposed by force or threat of damnation in the after life (or incarceration in this one).

Rosenberg finishes his treatise with two possible paths of decline, the timid one “The Reconquest” which will bring the West into a steep decline (Reverse Economy) that will doom generations of their [sic: our] offspring to yet another long regrouping or what he refers to as the De-Conquest in which a decentralized, distributed society emerges. He writes

"In fact, the more intelligent and well-read a person may become, the more likely he or she is to hold to some form of pro-liberty philosophy.  Some essential elements of a less-ruled or un-ruled world are these:

• Free human action.

• Unregulated trade.

• Individual or distributed defense.

• The frustration of talent is a cardinal offense.

• Unobstructed transportation.

• Decentralized communications.

• Ad hoc grouping and temporary hierarchies.

• Market above state.

• Self-regulation rather than legislated regulation.

• Temporary Autonomous Zones.

• Distributed justice and enforcement on the common law model.

• Breakup of states into multiple jurisdictions.

• Creativity overtakes Scarcity."

  ~ (from "Production Versus Plunder" by Paul Rosenberg)

If you buy into the logic of inevitable decline of the current model of societal organisation based on the entropic decay through over-centralisation of a system anti-thetical to the assumption of personal responsibility, personal capital formation and personal, anonymous autonomy, whilst insisting on all of those things as your “inalienable [non-negotiable] right” then compliance is no longer an option. Once you have accepted that the path we are on will eventually lead to the end of a way of life we had previously deemed immutable, uncomfortable as that thought might be, and that is unacceptable to you, it requires action. It is true then that a return to “normal” after the experience of the past few years is out of the question. It transpires that what we thought of as “normal” has been an illusion for some considerable time now and that we were already living in a world in which our right to life, liberty and the pursuit of happiness was just a gossamer-thin veneer on the surface of something very ugly.

To my mind, there is no going back, only a choice of how to be and behave from now onwards in pursuit of liberty and its attenuating responsibilities. My belief - only tenuously held at the best of times - that our system would right itself, has evaporated along with any illusions I may have had about the ultimate integrity of our institutional framework. Perhaps I am just being romantic when I mourn the passing of HM The Queen not only for herself and her example of a life lived in the Christian ethic but as a distinct break with a kinder past when even the lizard people had the decency to feel some sense of shame.

Rosenberg finishes up his book with a few calls to action, specifically that of non-compliance, of which he writes

Through the 20th century, the governments of the West thrived on nearly 100% compliance. Accordingly, they have built that assumption into their operations and now rely upon it. Automatic obedience, however, is not a historic norm and ruling systems have become brittle in this way.

If and when the people of the West stop complying automatically, the governments of the West may find themselves in a difficult situation. Either they will take it quietly, allowing non-compliance to succeed and spread; or they can crush non-compliance with violence, thus damaging their legitimacy. With a disobedience level of just 10% of the general populace, the governments of the West would be in serious trouble. If 20% stopped complying, those governments would fall apart." (from "Production Versus Plunder" by Paul Rosenberg)

I stand by my previously held conviction (and am doubling down on it) that simply owning a business and deciding to take personal responsibility for your economic outcomes is already in and of itself an act of defiance and non-compliance. It is not the only one available for sure, but it is a great place to start.

To finish, this from Neil Oliver, whose quiet modulated tone has become a balm for many saddened and angry at the current decline and who articulates that frustration in his weekly broadcast on GB News. Given his extraordinary popularity in “middle England”, I strongly suspect that the 10% threshold has already been breached.