Sunday, December 04, 2005
But that's where the parallel ends. While the peninsulares pretended to be an aristocracy, the criollos couldn't quite make it as the bourgeoisie.
In a rebellion against usurped colonial rule and for the restoration of the Bourbon king, Quito's criollos ousted Bonaparte's agents....but not for long. As soon as "loyalist" troops approached, the criollos abdicated power, hoping to avoid reprisal and retribution. They had no such luck.
The criollos had initiated a revolt against colonial rule in loyalty to colonial rule. Tripping over their own feet, the criollos make their entrance onto the stage of history with their pratfall nationalism, providing overture and coda to the development of bourgeois rule in developing Ecuador. Confusion, misstep, cowardice in everything save exploitation and oppression of the indigenous people was the singular contribution of the criollos to liberation from Spain.
2. The criollos of Quito emerge as attendants to an economy of forced labor, of compulsory exports, of the repressed and depressed domestic market. As such they inherit servility; they exhibit equivocation. They are, by the terms of historical origin, inadequate to the tasks of emancipation. They are detached from the organization of property and labor that could transform them from agents into owners; that would propel them into leadership. Only the merchant, trading bourgeoisie of Guayaquil have the attachment to bourgeois property that permits them to proclaim the indentity of patriotism, freedom, and commerce.
In October 1820, independence is proclaimed in Guayaquil by a junta under the leadership of the poet, Jose Joaquin Olmedo. But the criollos of Quito are silent. They lack a voice, even the voice of the second-rate bourgeoisie of Guayaquil which is strong enough, at least, to appeal to foreign allies, in Venezuela, in Argentina for the armies they themselves are to weak to raise, organize, lead.
Bolivar dispatches Antonio Jose de Sucre Alcala at the head of a detachment from his army of continental liberation. Sucre achieves a number of successes only to be defeated at Ambato at which point, he appeals to a foreign ally, Jose de San Martin of Argentina with his southern army of liberation. San Martin sends Andres de Santa Cruz Calahumana and 1400 troops to aid the "patriotic" army of foreigners, the international army of national liberation. And finally, on May 24, 1822, after the Battle of Pichincha, on the slopes of a volcano outside Quito, the Audencia of Quito is overturned. Ecuador is freed from the formality of Spanish rule; from Spanish administration. But the legacy of Spain, of conquistadore, of encomienda, of mita, of obrajes, of hacienda, and of course of peninsulares, criollos, and indigenas, remains and informs the future.
Sunday, November 13, 2005
The territory that was to become Ecuador was divided economically and ethnographically by coast, the Costa; by mountain, the Sierra, and to the east, the jungle, known as Oriente . The coast was inhabited by four major indigenous groups, the Esmeralda, the Manta, the Huancavilca, and the Puna. Hunters, fishers, traders, these groups traveled by sea along the coast of South America and also maintained an exchange of fish for salt with the inland, mountain groups.
The valleys and mountainsides inland were populated by the Pasto, the Caro, the Panzaleo, the Puruha, the Canari, and the Palta groups. Cultivation of maize, beans, potatoes, quinoa and fruits was widespread, with extensive systems of irrigation supporting agricultural production.
In the 15th century, northward expansion of the Inca empire from Cuzco was strongly contested in both the coast and the highlands. The resistance of the Canari and Cara peoples and all the groups on the coast around the Gulf of Guayaquil lasted for forty years, outlasting the 9th Inca, Pachacuti Inca Yupanqui; his son, the 10th Inca, Topa who conquered Quito but not the coast; succumbing about 1500 to Topa's son, Huayna Capac.
The Inca introduced new crops to both mountain and coastal agriculture-- sweet potatoes, yucca, coca, peanuts. Land was proclaimed the property of the emperor; land was worked collectively by groups of families called allyu. Each family in the allyu also held small plots of land for their own consumption.
The Spanish conquest was the destruction of the Inca empire's unique integration and autonomy of the region. Spanish rule was the economics of extraction and wages of extraction are economic dis-integration.
Lacking the apparent and accessible mineral wealth of other territories of the Inca, the indigenous people of Ecuador were spared the deadly mita exacted in servicing the silver, mercury, and tin mines of Peru and Bolivia. Instead the people of the Sierra labored in the workshops, obraje, chained to looms and producing the clothing of wool and cotton exported to Spain.
On the coast, Guayaquil was the center for shipping and trade, and although intra-American trade was prohibited by the Spanish mercantilist monarchy, Guayaquil served just such an extensive trade in hardwoods, textiles, and coca.
In the 18th century, the rise of British capitalism, the expansion of English textile manufacturing protected by its very own mercantilism, increased economic pressure on Spanish monarchy. Mother country and its mercantile satellite fell into extended and severe depression. It is estimated that textile production in Ecuador declined 75 percent between beginning and end of the century. The cities decayed, and the ruling elites were compelled to sell their jewelry an their haciendas to survive. In this the peninsulares and criollos of Spanish rule in Ecuador brought to themselves a taste of the life they had imposed on the indigenous peoples: production for export based, at best, on subsistence; production for export requiring always, and sooner or later, sub-subsistence.
3. Gran Plan Colombia
The Spanish royalty confronted its economics of dis-integration with re-formation of its agency of political authority, the Viceroyalty. In 1720, the Quito audiencia (sub-viceroyalty, or court) was transferred for the Viceroyalty of Peru to that of the Viceroyalty of Nueva Granada, headquartered in Bogota, Colombia.
In this re-formation the Quito based elite was awarded jurisdictional autonomy over local political and military matters, basically the exploitation of the indigenous people.
The award carried a cost and the cost was the redistricting of the audiencia. The southern and eastern borders of the audiencia were reduced with territory transferred to other viceroyalties. This shrinkage by decree and degree continued into the 19th century. In 1802, Quijos and Mainas provinces in the Oriente were transferred out of the Quito audiencia. Well before Bolivar's attempt at liberation and integration through the plan of Gran Colombia; before the US even dreamed of replacing Spain as the royal family of Latin America; the Spanish had attempted a post pre-Columbian pre-Plan Colombia Plan Colombia.
Saturday, October 22, 2005
Hard on the heels of OPEC's 1999 "3rd time's the charm" price increase, the US provided a spike of its own with its 2000 "Plan Colombia." No surprise there; what Saudi Arabia is to oil reserves, home to the largest and most profitable, the US is to guns and death squads. The US Congress authorized $1.3 billion to kit out the Colombian military with latest in counter-drug, counter- insurgency armaments. The size of the appropriation made it clear that there would be enough materiel to go around. There would be enough for the military and political officials to sell to the drug cartels thus offsetting any drop in their own income in the unlikely event the military actually interrupted the drug commerce; and enough to resupply the FARC and ELN militias who would tax the drug producers, accepting payment in weapons and ammunition. Who says the market is not the most perfect of mechanisms for the distribution of resources?
Of course the elements of the "plan" had existed prior to its designation as Colombian, prior to 2000, prior to 1999. More packaging than plan (everything under capital is more packaging than plan), more regional than Colombian, the United States ruling class had begun assembling the components after ceding control of the Panama Canal and Canal Zone to Panama. That, in conjunction with and under the cover of "drug interdiction," led the US to negotiate for and obtain "forward operating locations" (FOLs) from governments in Latin America and the Caribbean.
The FOLs were/are military bases from which the US military can conduct, and sub-contract, surveillance, interdiction, and insertion operations against.... against everything and anything. FOLs have been used to base air surveillance of the Andean countries; to intercept, and interrogate those attempting "unauthorized" immigration into the United States; for insertion of military advisors into conflict zones.
And since repackaging failed policies-- like reincorporating and renaming bankrupt companies, is essential to capitalism, indispensable for maintaining cash-flow-- each year of big bucks and little bangs brings forth pre-Plan Colombia and Plan Colombia repackaged as expanded regional initiatives, involving Colombia, Ecuador, Peru, Bolivia, Paraguay, and Brazil (in 1999 Chavez began limiting and withdrawing Venezuela's participation US anti-drug schemes).
In1999, Ecuador agreed to a 10 year lease by the United States for the Eloy Alfaro airbase at Manta on the Pacific Coast. While the advertised function of the US at Manta is "aerial detection, monitoring, tracking, and control of illegal narcotics activity," US actions have included naval intercepts of ships suspected of carrying "illegal immigrants," and accumulating intelligence regarding guerrilla fighters and movements of indigenous people on the shared border of Colombia and Ecuador.
Under Plan Colombian, the Colombia military was to take the war to the FARC and ELN guerrillas, covering anti-left warfare as anti-drug intervention; securing the benefits of pipeline capitalism for... for the pipeline capitalists, of course. But the Colombian military, armed and transported by the US has failed to isolate, encircle, and destroy the guerrillas of the FARC.
The FARC military and political command has been able to secure and protect rear areas, establishing bases in the Colombian region of Putumayo.
Unable to penetrate and control the Putumayo, Colombian military actions have created waves of refugees, with estimates of up to 75,000 Colombians forced into and through the Putamayo to seek safety in Ecuador. The FARC itself has reportedly set up areas for medical treatment of its fighters on Ecuador's side of the border with Putamayo.
Putamayo, surprisingly enough, is the area in Colombia considered the most promising for future exploration, discovery, and development of oil reserves. Or maybe not so surpisingly, since Putumayo borders the Ecuadorian areas of Sucumbios and Orellana, the two regions responsible for Ecuador's daily 500,000 barrels oil production; the two areas explored, exploited, and fouled by Petroecuador and the international oil majors, ChevronTexaco, Occidental Petroleum, Encana: two areas that, prior to 1967, were inhabited by indigenous tribes that recognized neither Ecuador nor Colombia, much less a border between Ecuador and Colombia; two areas where the indigenous peoples have been brought "forward" from their "archaic" past of isolation to the thoroughly modern conditions of advanced extraction capitalism-- the conditions of immiseration, oppression, and abandonment.
Since 2001, the US has added yet added another component to the identity of the enemy to be targeted by Plan Pipeline-- that of the indigenous peoples. And in a burst of serendipity, or radical simplification, or co-branding, the US found the one word, that ultimate in packaging, to describe them-- the Marxist guerrillas, the cocaine growers and manufacturers, the indigenous peoples-- all, and all of them: Testifying before a US House of Representatives subcommittee, US undersecretary of state, Richard Armitage announced that Al Qaeda cells were operating near Ecuador's borders with Colombia and Peru. There was the word, the package that was the best and the worst of times, the apex and nadir of capital, the fear and greed and trembling all in one: terrorists.
If historically the nation is the product, the symbol, and the package of the bourgeoisie's triumph over its predecessors; over the pre-conditions of its own existence; over feudal and near-feudal conditions of land and labor; of its unification of city and countryside into a home market-- if all that, then Ecuador was formed in the defeat, the strangulation of that revolutionary impulse of capital. Ecuador preserved in its very creation the power of those predecessors, those pre-conditions, that feudal and near-feudal relations of land and labor, that divergence between city and countryside, that insignificance of the home market.
And all these, these indexes of backwardness, these bundled incapacities, were/are but facets of capital's thoroughly modern incapability: the inability to emancipate the labor of the indigenous people. Capital's gleaming failure is the dirty secret to it tarnished success. And that success is the preservation of private property. In its preservation of the legacy of indentured labor, in its maintenance of the miserable, impoverished terms of labor, capital maintains its miserable, impoverished self.
From the 16th century, when half the indigenous population were confined to the slavery of the encomienda system through the late 20th century when 2/3 of the rural indigenous population served the hacienda economy, the huasipungo, by laboring 4 days of every week for the hacienda owners, through the 21st century where the national and international oil companies have destroyed the environment, the culture of the indigenous peoples, the oppression of the indigenous peoples has been the bedrock upon which church and state have rested.
In February 2004, the InterAmerican Commission on Human Rights of the OAS ordered the government of Ecuador to protect Leonide Iza, leader of the Congress of Indigenous Natives of Ecuador, from threats of assault and assassination. Responded Ecuador's then Minister of Energy and Mines, "The OAS doesn't give orders here." So does capital preserve the haciendaist in its modern terms of expropriation.
S. Artesian, October 22, 2005.
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Sunday, September 11, 2005
Capital's identity and contradiction, identity in contradiction, in relations of production-- private property, ownership, profit-- and means of social production-- improved methods of transportation, communication, circulation-- endows it with an "as if" personality. Capital's agents and owners act as if every action ensuring private property and profit is also an action to better social development, improve infrastructure, a greater good for the greater whole.
The as if personality, the as if class cares for nothing but appropriates everything. The as if class pretends that development, progress, is inherent in the aggrandizement of wage-labor, imminent in poverty. The as if class creates the personality that pretends, poses, imposes. It recreates itself through the reproduction of pretenders, posers, impostors, charlatans, failures, fuck-ups, greeters and calls them entrepreneurs.
2. Less Than Zero
At beginning and end, and every point between, the maintenance of bourgeois property and of the as if class requires denial and disavowal of reality. Responsibility is replaced by surprise, by shock, by real and feigned ignorance. The ideological alibis of the ruling class' agents change from the DC Watergate "I don't recall. I don't recollect," to the New Orleans Floodgate of "We didn't know. Who would have guessed?"
Accounting and accountability are screens for the destruction of assets; screens onto which the destruction of assets is projected as progress, growth, development, expansion--as creativity, creation, as intelligent design.
With the disavowal of reality, "loss of affect" is transformed from a highly subjective description of an emotional state to a historical necessity, a prerequisite for the accumulation and protection of bourgeois property. The bourgeoisie selects as its agents, its perfect representatives, not murderous psychopaths governed by a personal need to kill, to destroy; but rather compliant, facile, sociopaths governing by the larger class need to allow, potentiate, accelerate the murder and destruction inherent in capital's compressed identity. We get a government not of Ted Bundy's, but matchmakers for Ted Bundy; a government of dating services, chat rooms, for Ted Bundy capitalism.
3. As ifers...
The agents of the bourgeoisie pretend to be responsible; pretend to listen to "neutral," "objective," "scientific" assessments of danger, natural and social; they act as if preparations have been made; they pose as competent, deliberative, organized, capable. "Shock" follows exposure of incompetence, ignorance, failure. And the follow up to shock is a "mobilization" that only carries through to the bitterest of ends the prior destructive passivity.
The government is on vacation; the government acts as if it is monitoring the situation; the government acts as if it has been briefed; the government acts as if surprised; the government. acts as if shocked, appalled, sympathetic, remorseful, grieving, sorrowful. The government acts as if it will shorten its vacation; the government acts as if it is mobilizing; the government acts as if has assumed command and control; the government acts as if it will provide, will restore, will rebuild. The government is a government of by and for as ifers.
Rice needs another pair of shoes to govern effectively, as if that befits a secretary of state; Bush acts as if... Rumsfeld acts as if... Cheney acts as if...Brown acts as if....Chertoff...acts as if...
Meanwhile the destruction of the hurricane is furthered by neglect. Then the destruction of the hurricane is capitalized, literally, by deportation, forced expulsion, of the population; the letting of contracts without bid, without control, without command.
More as if is organized and distributed as the government, executive and legislative, vows to investigate, to probe, to determine, to assign, to determine, to rectify... As if the government is capable of anything more than as if..
Meanwhile, the as if government has a vision for the future of an as if New Orleans; and that vision is Nigeria, or Sucumbios in Ecuador, or, and at best, Santa Cruz in Bolivia enclaves of, by and for extraction capitalism
Response and opposition to as if begins with opposition to the invasion and occupation of the city by the military, by the mercenaries, by the contractors.
S. Artesian 91105
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Saturday, August 27, 2005
Revolutions are born, so to speak, in the breach, the rupture between the means and relations of production, the struggle between private property and collective labor. And the birth itself is often breech, the delivery being ass-backwards, feet first; so that the revolutionary agent sees its future in the unfulfilled wishes of the past.
The old relations of production cling to emerging revolution like an umbilical cord, and a tether. So that the opportunity for the success of a new society, for the triumph of the ruled, the dispossessed, the expropriated, appears to reconstruct the failures of the old society, to repeat past defeats, to confirm the impossibility of revolution, to re-form the collapsing relations of capital, of private property.
Where labor has been collectively indentured to landed property, where capitalism has proven itself capable of absorbing, but not breaking the archaic relations of land and labor, the revolution imagines a solution in the fragmenting of estates, the individual ownership of small parcels, the transformation of tenants, and landless, into peasants and peasants into farmers.
In the first page of his The Eighteenth Brumaire of Louis Bonaparte, Marx analyzes just this reverse self-projection of the revolutionary forces, their compulsion to cover themselves with the cloth of the past. There Marx writes, "The tradition of all dead generations weighs like a nightmare on the brain of the living." Nightmare it is and the nightmare weighs in as a dream-- a dream of happy pastoralism, of rural democracy, of "subsistence-plus" agriculture providing just the right things in the right amounts to markets of just the right size; a dream of farmers' communism.
2. Terms and Conditions
At origin capitalism distiguishes itself from its predecessors, and from coincident modes, through the enforced separation of land and labor. A specific relationship is established in this specific form of separation. Ownership, private property, exists as a condition of production. Ownership appears as a value in itself, as wealth in itself but essentially, ownership only has value to that degree that it transforms itself, is "lost," into the production of exchange values. The separation, expulsion of labor from land, is the source of that exchange value. Labor finds itself without use. The "owner" of the labor finds it useless, save for its value in exchange for the means of subsistence. Ownership of land, its organization as production for exchange, the expulsion of labor, and the engagement of labor power are the necessary, and coincident, opposites forming the totality, the identity of capitalism. Each exists only in the other.
Agriculture is transformed from a means of survival to a method of accumulation. Land becomes a value to be exchanged, piecemeal as products, or in total and all at once in outright purchase and sale; and in the assumption of debt.
Land as capital maintains its value as private property to the extent that it reproduces the expulsion of labor and the appropriation of labor power. And in this process, capital necessarily undermines ownership itself.
Property is private, sanctified, beatified even; but exchange, and the production of exchange, is a vulgar, profane, social process. Production, as private property, has to prove itself, never once but always eternally in the markets as social, as necessary, as useful. Ownership is subject to social validation, a validation that carries directly to the bottom line, a validation that materializes as profit. Simultaneous with the reemergence of capital as socially necessary, as certified, as profit, the profit loses its divine status. Profit must be restored to the organization of capital-- to the expulsion of labor from use, from ownership, from land, from the means of production.
It is not the markets that drives this process forward. It is this "genetic" make-up of capital, this metabolism of expulsion and engagement of labor, that drives production and the markets; that drives production into and even against the limitations of the markets.
Production for exchange subordinates consumption to the process of reproduction of capital. Where before markets are itinerant, transitory, limited by geography and climate, capital pushes them forward as permanent, universal, supra-natural, and supra-national. Surplus is transformed from a happy accident, a gift of nature, into the purpose, the subject of production. Accumulation of the realized surplus values becomes its object.
Capital, at once narcissistic and universal, sees itself in every moment of exchange, in every article of exchange brought to the markets. But the actuality of capitalist development is uneven, particular, mediated. Capital absorbs into itself, and embeds itself within, the pre-existing, archaic modes of expropriation. At one and the same time the bonds of private property and exchange tie capital into the preservation of landed property, the maintenance of indentured, "unfree," undispossessed labor, while the needs of capitalist production require the access to and expulsion of "free" labor, and thus the undermining of that same property.
History and Class, Bolivia Then and Now
The legacy of colonialism in Latin America is the legacy of indentured labor. The legacy of Spanish colonialism in Bolivia is the indentured labor of the indigenous peoples, the systems of the encomienda in the countryside, of the mita in the mining centers, of the alcabala . The legacy of the Bolivarian Revolution of the 19th century is the failure overturn and destroy the legacy of indentured labor; preserving instead the hacienda system, and its complementary opposite, subsistence agriculture, each and each other manifested in pongaje, peon labor.
The failure of the national revolution and the rule of the MNR from 1952-1964 was in its attempt to establish "idealized," "free," capitalist agriculture in the countryside through the conversion of the indigenous rural laborers and peasants into small capitalist farmers.
Upon seizing power, the MNR undertook extensive land tenure and political reform programs to enfranchise, and "property" the rural populations. Universal suffrage without property or literacy requirements was enacted, quintupling the size of the electorate.
The mines of the three major companies, Patino, Hochschild, and Aramayo, were nationalized.
The MNR took its main political inspiration not from the Russian Revolution, but from the Mexican Revolution; not from the Bolsheviks, but from the PRI. The hacienda system was attacked, with land distributed to rural tenants, but the hacienda system was not expropriated. Owners received generous compensation. Transfer of title to land was never made complete as most indigenous people did not have "suitable" documentation of either their own identities, or their historical claims to land.
Most importantly, production was not managed collectively. The hacienda system itself never created a developed, sustained, agricultural output. Indeed its survival was based upon a poorly developed infrastructure, isolation from internal and external market forces, and the absence of advanced technical inputs like irrigation and electric power.
Division of the hacienda system into small parcels only made the development of the supporting structure for agricultural growth more difficult, more expensive, for the MNR.
On a deeper level, however, this legacy of underdevelopment is intractable in the face of individual, peasant ownership. Capitalism at its origin, in its whole history, has never been established on the basis of individual peasant ownership. Just the contrary, capitalist agriculture begins with the expulsion of the peasantry from ownership, the expropriation of the land and its conversion from means of subsistence to means of exchange.
In Bolivia, the lack of infrastructure, the lack of technical development, combined with the individual parceling of the landed estates, pushed the rural populations back to subsistence production, without product or access to markets.
The indigenous rural populations of Bolivia had never been organized around individual, peasant production. The original, pre-colonial forms of agriculture had been based on communal ownership and communal production. The "settling" of the indigenous people as tenants on haciendas was rooted in more than the destruction of those communal forms. It was rooted in the decline of the colonial mines, a "pre-deindustrialization" so to speak, that forced the indigenous workers into the hacienda forms of tenancy, peonage, indentured labor.
During the MNR 1952-1964 tenure, the fragmentation of large estates into parcels of direct ownership and self-labor, without adequate infrastructure development debilitated agricultural output, and exhausted the land.
The MNR's policy, this agricultural oxymoron, to make subsistence production and labor the basis for capitalism, when capitalism is based on the expulsion of labor as the means to the end of subsistence production, fed into the economic collapse that engulfed Bolivia.
In desperate attempts to control the rural population in the countryside, and the workers in the mines, the MNR turned to the US to resupply, retrain, and reorganize Bolivia's military. Thus the democratic revolution of 1952 organized its own overthrow in 1964.
Like Oil and Water...and Land and Labor... and Santa Cruz
Between 1971 and 1978, the Hugo Banzer's military government in Bolivia distributed some 30 million hectares of publicly owned land in the Santa Cruz and Beni departments. The land was distributed in large units to few individuals, creating what has been called the "neo-latifundismo."
In Santa Cruz and Beni, extensive tracts, given extensive financial credits and technical support, have resulted in significant expansions in soybean, cattle, cotton, and timber production. These areas of "true" "modern" capitalist agriculture are the product of international penetration, rather than "national revolution." The Banzer regime relied upon two pillars for support, the bayonet and the international banks to protect and subsidize its economic policies.
And who received these subsidies, these credits, this support for a truly modern capitalist agriculture? The new latifundistas of Santa Cruz are not the offspring of the old latifundistas, the offspring of the haciendistas. The modern farmers of Santa Cruz are Mennonites from North America, Japanese, Okinawan migrants, and Brazilian investors.
As the oil companies and their agents in Santa Cruz are international in production, in ownership, in exchange, so is the capitalization of agriculture in Santa Cruz. Soybean production has transformed itself from simple export of the primary product into increased imports of soybeans, and processing of both imported and local production into oils and cake for export exchange.
Oil, soybean and petroleum, describes the "modernization" of Bolivian bourgeoisie.
Both sections, the "modern sections" of the Bolivian bourgeoisie are demanding "autonomy" from La Paz. In reality, they are demanding separation from the indigenous peoples, from the rural landless, from the unemployed and dispossessed miners, from those who have felt the failure, the impossibility of the national revolution; from those who know that the only path forward-- for development, against exhaustion of the land, destruction of the environment-- is the elimination of subsistence through the collective expropriation of the means of production
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Saturday, July 02, 2005
Parliaments, created first as the instruments of civil war, as the instruments for the ascendancy of bourgeois property, are endured by the bourgeoisie only to the extent that they remain true to their origins, true to that form of property, by becoming their opposites; to the degree and to that degree only that parliaments functions as substitutes for civil war. As long as legislation functions to preserve private property, legislatures are tolerated. When and if legislation violates that condition, becomes a contradiction reflected back unto itself, it means parliament, and parliamentary maneuvering has become obsolete. History, sooner or later, accepts no substitutes. In Bolivia, that sooner or later is here and now.
2. Mesa vetoed the energy law and triggered his own downfall. Eleven months earlier, Mesa had initiated a national referendum on how Bolivia should exploit its natural gas resources. The results of that referendum overwhelmingly supported Mesa's stated intentions to raise royalties on production to the 50% mark, and to export gas through Peru rather than Chile.
In October 2004, Mesa sent the Bolivian Congress a new energy bill that re-nationalized Bolivia's hydrocarbon reserves, increased royalty rates, and returned regulatory control over production and export to the government. The international energy companies protested and threatened court action if the bill were enacted. The energy companies claimed the law would violate the terms of 40 year contracts the Bolivian government had signed in 1996.
International energy companies, through the good offices of the US ambassador, then entered into intensive discussions with Mesa's government where, once again, Mesa showed his ability to listen and compromise. When Mesa vetoed the legislation of May 2005, vetoing essentially the legislation he proposed in the national referendum, he cited the possible illegality of the law in nullifying the 40 year contracts.
The workers and poor of Bolivia, with a life expectancy of about 60 years, in a country with a poverty rate of 66%, and an infant mortality rate of 53 per 1000 live births, didn't want to kill time for 40 years, especially when time was killing them. By May 23, the streets of El Alto were completely in the hands of protestors. In the first week of June, three oil fields belonging to the Spanish company Repsol YPF were occupied by workers and poor. Repsol YPF has rights to 35% of Bolivia's natural gas reserves. The Chaco fields of British Petroleum were also occupied.
Proving once again that he could listen and compromise, Mesa announced, "I have only hours left as president." He was right about that.
3. The origin of the 40 year contracts was in Bolivia's Capitalization Law of 1994. The capitalization act was specifically aimed at Bolivia's major public companies: ENDE (electricity), LAB (the national airline), ENFE (railways), ENAF (smelter) , ENTEL (telecommunications), and YPFB (petroleum and natural gas). The program awarded, by international tendering of shares, 50% of the company to investors. The other 50% was designated as a national reserve "belonging" to the Bolivian people, but only through private pension funds handled by international trustees. Sound familiar? Marx, 150 years, ago advised those trying to understand the future of India to look to Britain. Today that advice is just the reverse. For those trying to understand the future of international capitalism, the future for living standards, wages, and pensions; for those trying to understand that future has already begun, the advice is to look to Bolivia, Indias, Sri Lanka, Senegal, as capitalism seeks ways to reduce living standards, to "third world" the working class everywhere.
Administrative control of the privatized company would rest solely with the private investor. This control was guaranteed by the law, by the execution of the capital contracts of purchase, and through administrative contracts for management services. The private investors maintained this control for a minimum of 5 years, or until their investment had been recuperated, or for the terms fixed in the contracts themselves. Thus 5 would get you 40, or rather 50 got you 100 for 40. Nice math, if you can get.
And the bourgeoisie got it because they tried. YPFB was split into two "upstream" (extraction and production) companies, a transport company, a refining company, and several oil and gas service companies. BP Amoco and Repsol YPF purchased 50% of the two upstream companies. Transredes, a joint venture of Enron/Royal Dutch/Shell Game, bought the natural gas transport company.
Competing against the EU/US energy majors, Argentina's YPF, Pluspetrol, and Brazil's Petrobras pushed investment in natural gas reserves and pipeline construction.
Foreign direct investment following the 1994 capitalization law soared, tripling between 1994 and 1995, doubling again between 1996 and 1998, reaching $957 million. While FDI in the energy sector peaked in 1998, total FDI peaked in 1999 at $1.017 billion, only to decline 27% in 2000.
Proven reserves of oil and gas followed the investment boom, with proven gas reserves exceeding 50 trillion cubic feet, and oil reserves tripling to 440.5 million boe.
The overinvestment in petroleum production that led to the price collapse of 1998 was reflected in a decline in the number of exploratory leases bid upon by, and awarded to, the international energy companies. While 16 blocks were awarded for exploration in 1997, only 2 were awarded in 2000. The awarded blocks provided reserves far exceeding original estimates, with proven reserves of natural gas in 2000 exceeding 1997 estimates sevenfold.
Despite this increase in reserves, annual gas production was essentially unchanged between 1995 and 2000 as infrastructure and markets were inadequate to both reserves and production capacity. Half the produced gas was being reinjected or flared off.
4. In keeping with their inability and disdain for the tasks of actually governing Bolivian society, and with international capital's love of concession, enclave, capitalism, the criollos eastern provinces bang the drum for autonomy, the autonomy of the propertyholders of the gas and oil leases, although the east is not the area of the greatest reserves. The overwhelming portion of the growth in reserves is in the Tarija region of the south. But fragmentation is the goal, and the east is where the criollos and the energy majors formed their first alliances.
Bolivia, the class struggle, is the critical manifestations of uneven and combined development-- a property organization incapable of supporting a domestic market, of "emancipating" enough labor to develop the society, coupled with the highly advanced capital intensive petroleum industry where the fixed expenditures wind up reducing the rate of return on investment, thus further depressing economic growth, and inhibiting the reproduction of capital itself. Expropriation of the expropriators is the only method for the resolution of this contradiction.
If the struggle for control of hydrocarbon reserves and production was precipitated by the capitalization law of 1994, that law itself was pre-figured in the IMF proposed, national bourgeoisie imposed, dismantling and destruction of the tin mining industry.
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Sunday, June 12, 2005
The Bolivian people however weren't. Blockades continued. Demonstrations against privatization of resources and basic utilities gained strength.
The residents of El Alto, the city that overlooks La Paz had taken to the streets, had taken the streets, in order to drive out a French company which, after having secured private control of the city's water supply, failed to deliver the water. La Mesa capitulated to El Alto and cancelled the contract.
The table was set and Mesa was on the way down. The commanding heights of the society were the city streets, the village roads, and those belonged to the people.
Protests and demonstrations ebbed only to flow again. Since January the country has been locked in close quarters class combat.
Actions against water privatization and fuel price increases became demands for the expulsion of international oil companies and for the nationalization of the entire energy sector.
In March, Mesa threatened/promised to resign when the Bolivian Congress was reluctant to consider his proposal for a new tax rate on oil and gas extraction. With the full approval of Washington, Paris, Madrid, and Brasilia, Mesa offered a 32% tax on gas extraction, a rate that could be both reduced and deducted from income taxes.
Evo Morales, leader of the Movement for Socialism, MAS, the major opposition force both in and out of Congress with extensive ties to those blockading highways and streets, introduced a flat 50% royalty assessment against the international companies, which will prove that the difference between Mesa and Morales, in the long run, is one of percentage and not one of principle or principal.
The Congress agreed to review Mesa's plan, thus delaying the inevitable, Mesa's resignation. But first the lower house of the Bolivian Congress adopted a tax/royalty structure equal to the 50% non-deductible assessment, and the senate soon followed.
The international petroleum companies, led by Repsol and Petrobras, weighed in with threats of disinvestment if the 50% bill was enacted. Said the chief of Petrobras' Bolivian operations: "Don't take this as an irrational threat. The money is there, but if it is not going to be profitable, we will not invest it." Apparently, the ability to listen and compromise only goes so far, 50%, halfsies, being far too irrational a compromise.
But here's the joke, international investment in Bolivia's energy sector had peaked in 1998 at $605 million. In 2003, the amount invested had declined to $281 million. Overall foreign direct investment declined 45% between 2002 and 2003 to $357 million. In 2004, investment in the energy sector declined another 16% to $235 million.
So while the bourgeoisie, local and international, warned of shortfalls, disinvestment, declining production, in reality it is overproduction that has driven the workers, the poor, the landless, the indigenous peoples into the streets and across the highways to block yet another effort by capital to extract value through the extension and expansion of poverty. Profit, uncompromised profit, is the eternal and ultimate rationality of capitalism. Poverty is the once and future product, as the people of Bolivia know, of enlightenment.
June 12, 2005
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Sunday, May 15, 2005
If the 2002 financial performance of US energy majors foretold the 2003 invasion of Iraq, then the 2003 performance of the US energy majors forecast, foretold, and secured the re-election of George Bush as President of the United States and Lobbyist-in-Chief.
That the publication of the US Energy Information Agency's 2002 Performance Profiles of Major Energy Producers first made its appearance in 2004; that its 2003 Performance Profiles made it into the public domain in 2005 proves, among other things, that profit determines policy and not vice versa; that foresight beats hindsight ; that the production of oil is all about the expropriation of value and not the geological limits of supplies.
The energy companies participating in the EIA's Financial Reporting System (FRS) reported 2003 earning of $57.4 billion, triple the 2002 level, and the highest net income since 1980. Return on stockholders' equity (ROE) increased from 14.6% in 2002 to 18.1% in 03. This ROE exceeded that of the S&P Industrials by 4 percentage points for the 2000-2003 period, after averaging 3 percentage points less that the S&P Industrials ROE for the 1985-1999 period.
The increased return was a direct product of increased prices, with crude prices increasing 17% and natural gas prices at the wellhead up almost 70 percent. The higher prices made oil and gas production the most profitable business segment for the reporting energy majors. This surge brought the yearly average contribution to net income from production for the 2000-2003 period to $37.1 billion vs. the yearly average of $14.7 billion for the 1990-1999 period. Most importantly, the rate of return on investment (ROI)in 2003 increased to 15.3 percent.
2. Sea of Love, Sea of Cash
2003 was also a profitable year for the refining and marketing segments of the business. ROI in these sectors reached 8.9% vs. the 5.8% average for the 1990-1999 period.
Cash flow from operating activities reached $105.1 billion in 2003, the highest level ever recorded by EIA. Since the OPEC price increases of 1999, cash flow from operations has averaged $28.1 billion more (in constant 2003 dollars) per year than averages for the 1986-1999 time frame.
But increased cash flow has not translated increased capital expenditures. Such expenditures declined by almost $21 billions from 2002 levels. Merger and acquisition activities, a significant segment of capital expenditures, declined by two-thirds in 2003.
The FRS companies used their increased cash flows into paying down debt, stock repurchases, and dividend payments. More than half of the increase in cash flow went to these three activities, outweighing the stream of cash assigned to capital expenditures . The energy majors reduced their debt to equity ratio by more than 5 percentage points, bringing their ratio 20% delow the debt-to-equity ratio of the S&P Industrials. Cash and cash equivalents on hand grew nearly $9 billion in '03, the largest year-on-year increase ever reported.
The single greatest increase in cash flow assignment was the doubling of stockholders' dividends to nearly $43 billion.
3. But None for You....
Cash assigned for oil and gas exploration, excluding the cost of unproved acreage, by the FRS participating companies declined for the second year in a row, down 21% from 2001 levels. While expenditures for finding reserves declined, the FRS companies increased funds for developing already proven reserves. The development expenditures rose 5% , achieving their highest number since 1982.
In the classic manifestation of overproduction rather than reserve depletion or scarcity, high prices lead the energy majors to bring their areas of known reserves into production; to favor development over exploration.
The energy majors continued to focus on the US offshore area, continuing the pattern first established in 1992. US onshore, despite the age of its fields, still receives more exploration expenditures than any single foreign area. Worldwide, the US energy majors continue to spend the most for exploration in Canada and Africa.
4. And More Than Enough for You..
The reserve replacement ratio, (reserves added in relation to volume extracted) measured 1.04 (104 %), a 9% increase over 2002. Even this, however, was below the 1.25 ratio of the 1990-2001 period.
Despite the reduced capital spending, despite the focus on developing only proven acreage, replacement rates exceeded production.
5. Old News is New News... Supply Meets Demand, Prices Soar.
The 2003 financial performance of the energy majors, as reported in 2005, continued throughout 2004. In the fourth quarter of 04, net income for the FRS companies exceed 4Q03 levels by 101 percent. For all of 04, net income was 54% higher on 26% more revenue.
The petroleum sectors, (oil and gas production and marketing) registered a year-on-year increase in net income of 93%, based largely on a 30% increase in prices. Worldwide supplies increased 4%, as the actual reserves of oil continue to defy the peak oil theories. Again.
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Sunday, April 24, 2005
1. The future of advanced capitalism, called "globalization," was unveiled 32 years ago when it was already 200 years old, on the Avenida Bernardo O'Higgins in Santiago, Chile. Chile became the host, the in vivo subject/object of and for export capitalism. If the three modern princes of reaction and regression, Kissinger-- the would-be Metternich, Friedman-- the monetarist Ayn Rand in drag, and Pinochet-- the petty man on miniature horseback, had a better feel for PR, they would have claimed paternity for the birth of globalization, trademarking the word and living it up on royalties deposited electronically into their Riggs Bank savings accounts. But then the three marketeers would have to accept responsibility. Or maybe not.
Responsibility is, of course, anathema to markets and private property. The ultimate creation of the bourgeoisie, the corporation, was developed precisely to avoid and evade personal responsibility. If the bourgeoisie deny the existence of class, substituting the imaginary individual in order to obscure the social expropriation of labor, the very same bourgeois class creates the imaginary individual, the corporation, in order to protect their class wealth.
2. After the overthrow of Allende, the Pinochet government reversed the land reforms initiated under the Frei and continued under Allende. The anti-reforms were critical to the severe economic contraction that expelled hundreds of thousands of former agricultural producers, workers and owners and mostly male, from the land, and the labor process. Economics is, after all, and first and foremost, nothing but class struggle.
And class struggle is always international. The anti-reforms were part of the reorganization of the economy for export, for servicing international capital. With the anti-reforms, Chilean fresh fruit exports began a significant and sustained increase, growing 20% per year.
Employment followed the expansion, as the bourgeoisie love to say. Employment in the fresh fruit sector of agricultural production grew from 66,000 in 1974 to 178,000 in 1992. The terms of employment followed the class struggle, the anti-reform, as the bourgeoisie don't care to advertise. Permanent employment in the entire agricultural sector declined 40% from 208,000 to 120,000 while total temporary employment in the sector more than doubled to 300,000.
The increased production in the fresh fruit sector was fed by the increased temporary employment of women workers. Increasing steadily throughout the late 70s and 80s, by the 1990s women were 30% of the labor force, and women worked almost exclusively as temporary workers and on a piece work basis and often as sub-contracted laborers.
The "great" movement of globalization was built exactly on these three corners-- a new triangle trade, of female labor, at lower wages, hired daily to be dismissed overnight.
3. "Globalization" wasn't that "great" to begin with and never got any better. Annual rates of growth in manufacturing, trade in manufactures, general economic growth, overall trade never equaled, much less exceeded, average annual rates of growth for the 195o-1973 period. But in comparison to the rates in the 1980s, globalization was just a little bit of bourgeois heaven right here on the bourgeoisie's earth.
Globalization, trade expansion, market growth were driven forward by a recovery in the rate of return on investment in manufacturing. As is always the case, that recovery in profits depends on the relations between the components of production, living and dead; upon the ratios and rates of exchange between wage-labor and capital. The reproduction of capital, locally and globally, takes place precisely to that degree that labor is stripped of every "asset," every ability, every use, save its ability, its usefulness in exchange; exactly to the degree that labor is incapable of reproducing itself separate and apart from wages. Thus backward and forward capital pushes against "traditional" forms of subsistence, and against "reformed," " progressive," "protected" conditions of work in both agriculture and industry.
"Globalization" breaks through the isolated, simple deprivation of rural life, the simple, subsistence poverty of "under-development," to create the expanding, interdependent, exploitation and immiseration of modern capitalism.
4. Word trade in textiles and garments grew tenfold between 1973 and 1992, tripling since 1992 to approximately 450 billion dollars. The expansion of this capital sector has been based on those principles of "economics" established in Chile: disruption of traditional village economies and/or counter-reform of agriculture; increased female participation in the work force; lower wage-rates for women; increases in temporary, sub-contracted, mostly female laborers.
In Chile,women workers were unable and resistant to internal migration. The increased participation of females in the textile industries of Africa, Asia, and Latin America has been marked by the increased internal migration of women to the industrial, or urban zones, from the rural and traditional village economies. In the Shenzhen special economic zone of China, the population increase from 300,000 in 1978 to 3,000,000 in 1998. Two-thirds of that population is migrants, with two-thirds of the migrants women aged 15 to 29 years old. In Bangladesh, employment in the textile sector increased from 4000 in 1978 to 1,200,000 in 1994; 85 percent of those employed are female.
"Professional" economists will refer to the "nimble fingers" of women (and children) as the reason, the "demand" for the increased employment of women, thus proving that biology and not patriotism is the last refuge of scoundrels. Political economy, like biology, cannot account for history, the social changes in the organization of labor and production-- the previous concentrations of men in textile production; the lower wage rates paid to the more nimble, hence more productive, women workers; the increased use and classification of temporary labor despite the nimbleness of the more productive, lower paid women workers.
Anathema, heresy, vital threat to the flim-flam men of capital's various religions, "Darwinism" is a godsend to the scam- artist ideologists of free markets. "Down with Darwin! Up with Social Darwinism!" scream the vouchers distributed to and by the faith-based, corporate, god and dollar trusting salesmen of globalization.
5. From the Quangdong to Bangladesh to the Dominican Republic to Mauritius to Bangkok, Madagascar the terms of production and employment in the textile and ready-made-garment (RMG) sectors follows a pattern cut from the same cloth: young women from rural impoverish areas, migrating greater or shorter distances, to industrial clusters or urban areas, entering the labor force and obtaining their first waged work in textile or RMG production.
The sector is organized around low wage, intense exploitation export-oriented production. And the single largest export market is that of the United States. Rates of growth in textile and RMG exports to the United States from these less developed areas commonly exceeded 20% per year in the 1990s.
Prior to 2005, developing countries' exports received some protection in the form of quotas, and almost guaranteed market shares under the 1995 WTOs Agreement on Textiles and Clothing (ATC). This agreement extends the protections and quotas established under the pre-existing Multifiber Agreement (MFA) while requiring member countries in general, and the advanced countries in particular to bring their textile and clothing import policies into conformity with the provisions of the GATT. The ATC accord established a ten year transition period, expiring in January 2005, at which point quotas, protections, and tariffs on textiles and clothing would be withdrawn, and that perfect capitalist condition, the war of all against all, might resume.
For the textile exporting countries and the textile importing countries, there is a 10,000 ton elephant in the room and the elephant is China. The recipient of over 600 billion dollars in direct foreign investment since 1986, and an an equal amount in loans, China's potential output alone can satisfy 50% of world export demand for textiles and ready made garments.
Since January, US imports of textiles and RMG from China have grown 62.4% from the year earlier period. The total dollar value of US imports of textiles and RMG, however, has grown only 17% year to date. And the reality is that even that 17% is an inflated number. WTO figures suggest 2/3 to 3/4 of the increase in the dollar value world trade over the past two years is the result of the US currency's depreciation.
The "great fear" of China in the textile markets is the distorted image of global overproduction of textiles. The expanded reproduction of capital has not been able to sustain an increasing rate of return on investment and increased profits. Slowing growth of export markets, problems in the circulation of commodities are in reality difficulties in the realization of surplus value as profit. And this difficulty is not confined to the textile sector. On the contrary, the contraction in the markets for textiles, in the consumer markets for ready made goods, is a reflection of the generalized overproduction of capital in the advanced countries.
The response to this difficulty will include increased rates of exploitation, reduced wages, layoffs, and the shuttering of factories. The impact on production workers, on this global force of laboring young women will be, is already, dramatic. The improvements in diet, health care, educational opportunity, physical security brought by temporary, if irregular work, by increased, although less than those paid men, wages, will disappear. Already subject to physical and sexual abuse at the hands of male supervisors at work and thugs on the streets, declining employment will make that many more women targets for attack and the involuntary servitude of the sex industry.
Where in the 19th and 2oth centuries, the bourgeoisie would pretend to "offset" contractions in their domestic markets by investments and expansion of overseas markets, the developing countries cannot play the film in reverse, cannot offset the contractions and competition in export markets through expanding domestic markets. Expanding, creating the domestic market, means and foremost, completing the reorganization of agriculture, of the land slavery, the subsistence poverty of agriculture. It is exactly that task that capital cannot accomplish. It is exactly that failure that makes all capital export capital; that makes globalization what it is today-- the same old, brand new-- the reproduction of misery.
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April 24, 2005
Saturday, March 19, 2005
UNLEASH THE ACCOUNTANTS
SEND IN THE STOCKBROKERS
I. Borrowing from his experience as a greeter at the door to vertically integrated petroleum companies, George W. Bush tried a little vertical integration in the executive branch of the US government. Guided by the capable hands that guided Halliburton, Monsanto, Enron, Dynergy, El Paso, MCI, Global Crossing, Arthur Andersen, and the Texas Rangers, George decided that transportation security, infrastructure safety, border control, marine policing and much more, would be integrated into a new ministry of the interior, the Department of Homeland Security.
The ministry was charged with developing a common platform for the collection, analysis, and investigation off all threats to the internal security of the United States. But such a database won’t be built in a day, and so while the new ministry’s budget provided billions for the application of advanced technological protections for the domestic tranquility, for private property, for the unfettered and unrestrained extraction of profit, the Minister’s own prescriptions tended toward the mundane, the simple, even the simple-minded.
Knowing that familiarity is 90% of effective representative government, the Minister decided to really put the home in homeland security, first color-coding terrorist threats and then providing the Home Depot solution to personal protection, plastic sheeting and duct tape. Where Lenin saw that every cook would govern, Bush saw every American safe and secure in a duct-taped zip locked Glad Bag. And since duct tape comes in colors, citizens everywhere could show their patriotic allegiance to the Ministry’s pronouncements by changing the duct tape to match the color of the day’s terror alert status.
Determined to stand fast behind flag, dollar , and consumer debt in the arduous and perilous times ahead, US residents stocked up on duct tape, plastic sheeting, Krispy Kremes, potassium iodide pills, and DVDs.
If defense of the homeland depended on the application of duct tape, defense of the empire required something with a bit more punch: depleted uranium. Having taped the windows at the White House, George commanded his generals and admirals to seek out , close with, and destroy the Beelzebub of Baghdad, Saddam Hussein. Steaming full ahead, the USS Carlyle with the Secretary of Defense at the helm, cruise missiles at the ready prepared once and for all to settle the question of exactly who was running the Bartertown of global capitalism.
Depleted uranium and duct tape, the alpha and omega of advanced capitalism. Depleted uranium and duct tape, items of sinister utility held the whole truth about primitivism of the modern world.
II. History does not exist for capital. In its stead the bourgeois order comforts itself with the records and measures of past performance. Price, volume, supply, demand, cost, all exist, but only as things onto themselves, separate and apart from the conditions of production.
Memory then quite naturally tends towards nostalgia, a wistful recollection of a past performance never quite that good in reality.
Thus the "boon " of the 90s has no history, no origin in the previous twenty years of declining real wages for workers in the US and throughout the world; no origin in the redistribution income from the poorer to the wealthier; no origin in the employment of legions of women at substandard wages in substandard factories for the production of everything from sneakers to chicken parts; no origin in the dismantling of the Soviet Union and the use of its economy as kindling. "History is bunk!" said Ford. "Nothing of value before me," says our ahistorical bourgeois, "Nothing of value after me."
The dreary present of capital and its bleak future combine to make the near past a regular utopia. But it was not, as these things go, by the measures of past performance, the biggest of boons. The average annual rate of growth (AARG) for world merchandise trade in the period 1990-2000 at 6.6% was below the levels for the periods 1950-1963 and 1963-1973. AARG for manufacturing output at 2.5% was one third that for both prior periods.
But when past performance doesn’t quite support the grandeur of a moment, then that past performance is discarded, relegated to ancient history. Nostalgia finds comfort in the performance of the period 1973-1990. And compared to that period’s meager 3.9% rate for merchandise trade, the 1990-2000 period looms as a regular Mount Olympus.
Trade is where every bourgeois sees, hears, tastes, feels the sweetness of profit. Production is only ancillary to exchange, a necessary encumbrance, but still an encumbrance . It’s the market where greed and fear materialize and disappear in the accumulation, or loss, of money. "Circulation," wrote Marx, "sweats money from every pore."
Trade and output, production and circulation, profit and expenditures, growth and assets, are quantities , static measures of capital’s performance. They are the end of history at the bottom line of the accountant’s ledger book.
The rate of growth, the rate of profit are the qualities of capital that take it back to its origins; that bring history up to date, and with a vengeance.
III. The history of capitalism since 1973 is the record of its struggle with the falling rate of return on investment. It is the history of overproduction.
After OPEC 1 and OPEC 2, after stagflation, inflation, recession, the financial arson of the leveraged buyout period, deregulation, the S&L collapse, the first Gulf War, more deregulation, globalization, after all that it’s still overproduction manifesting itself as the declining return on investment that shakes the ground of capital.
Basking the glow of the oil fires in Kuwait, capital thought it had the solution to overproduction. Sense and anti-sense were rolled into one. Capital formation would be the end to overproduction. Capital formation, increasing the need/availability of/for equity and debt was the promise at the end of history. Recombinant capital triumphant!
The first triumph was the emerging markets of Pacific Asia; Indonesia, Taiwan, South Korea, Indonesia, Singapore, Malaysia, the Philippines. Between 1990-1996, annual increases in fixed capital formation in ranged between 20% and 40% of the GDP.
Between 1979 and 1997, China, a globalization all unto itself, received $510 billion dollars in foreign direct investment and an equal amount in loans.
Between 1992 and 2001, capital expenditures in the United States doubled. In the US and the UK, the telecommunications industry led the way , amassing almost one trillion dollars in loans, half a trillion dollars in bonded debt, and issuing another half trillion in equity. Still, with all this capital formation, this two trillion dollars measured only half of the industry’s cumulative capital spending up to 2001.
In 1993, capital investment in communications, information equipment, and software was measured at 37% of all capital investment. By 1999, the amount invested in these areas tripled, and accounted for 53% of all capital spending. By 2000, the proportion had grown to 60% of all new capital spending.
The technical progress of the telecommunications industry propelled forward by capital formation. At the same time it devalued all preexisting capital. Each new Atlantic cable added bandwidth equal to all previous existing transatlantic bandwidth.
Profits grew, and the growth was a direct result of this technical expansion, this transfiguration of labor productivity into the instrument of expropriation. The costs of production for this industry, for manufacturing, transportation and communications as a whole, were driven to historic lows.
In 1993, after-tax corporate profits measured 29.3% of the growth in nonresidential private fixed assets. By 1995, the ratio had grown to 33% of the growing investment in nonresidential fixed assets. The ratio of profits grew yet again in relation to the expansion of fixed assets, measuring 34% for 1996 and 1997 before falling in 1998 to 26.9%, a rest stop on its way down to 16.35% in 2001.
After-tax corporate profits exhibit a similar, and similarly dramatic relation in its ability to replace the consumption of fixed capital in the production process. For 1993, profits equaled 76% of the consumption of fixed capital, a margin that grew to 97% in 1996 and, dream of dreams, holy of the most holies, 102% in 1997. By 1998, the ratio declined to 86.8% and by 2001, it was down to a recession level 67.4 percent.
Any way we turn it, cut it, look at it, 1997 was the peak year for the rate of profit as US after- tax corporate profits reached 7.61% of the gross product of non-financial businesses. That ratio collapsed by half to measure a meager 3.8% in 2001.
While capital investment increased, manufacturing employment was essentially flat, and compensation rates barely moved. The very mechanism for the expansion of profits thus became the reason for the reduction in the rate of profits as less and less labor power animated greater masses of fixed capital.
In this decline, the telecommunications industry again led the way. When the markets proved incapable of sustaining the acceleration in capital formation, the debt and equities of the industry collapsed. By 2001, 60 billion dollars in telecommunications debt was in default. Average equity valuations had declined by half , physical assets were selling for 2 cents on the dollar. Assets only have value for capital to the degree that they can accelerate the extraction of profit.
Money, as the abstraction of the abstraction of exchange value, is the most sensitive link in the daisy chain of capital’s transformations. Thus the overproduction, the capital formation, that precipitated the peak and the decline in the rate of profit manifested itself first in an attack on the currencies of those countries where fixed capital formation had been most intense, Pacific Asia. From there, the manifestations of overproduction spread east and west , attacking the currencies of Brazil and forcing Yeltsin’s government in Russia to default on its GKO bonds.
Mesmerized by the opening and closing bells of the New York Stock Exchange, the US bourgeoisie were not just deaf to the sounds of distress coming across the Pacific, they were amused. Entertained by the disaster in Asia, they trembled at the threat to Brazil, and sweated bullets at the default of Russia. Such was the ultimate product of capitalist circulation.
Behind the ringing in of the new highs in the stock market, behind the electric sounds of credit cards and cash registers engaged in oxymoronic couplings, exchanging digitized bodily fluids in a billion bits of a million orgasms each second, there was the soft sound of something falling and not yet hitting, a body perhaps.
Somewhere in some back office two accountants worked long and hard into the night, rearranging profits, assets, trades, like molecular biologists rearranging snips of genetic code. "Did you hear that ?" asked one. "Sounds like chickens," said the other. "Maybe they’re coming home to roost," answered the first. The two accountants looked at each other and agreed to book the chickens as assets. But the noise wasn’t that of chickens. It was the wolf knocking at the door. And she was hungry.
IV. The bourgeois class is not organized as a class for the pursuit of knowledge, the advancement of society, science, technology, or even socially necessary production. The bourgeois class exists only to make money.
The history of the last thirty years is the record of the bourgeois order’s attempt the overcome the predicament at the core of the capitalist mode of appropriation. The means of production are organized as private property but can only function, generate profit, as capital, that is, by an exchange with social, wage-labor. The appropriation of unpaid, surplus, labor-time, time not necessary for the sustenance of wage-labor is the basis for the extraction of profit.
For the system of production as a whole, increasing the rate of aggrandizement depends on the technical development of the means of production. At a certain, critical, point the expansion of production outstrips the growth in the relation of profits to expansion itself. Production outpaces reproduction. The rate of profit falls. Then the expense and the development, of the means of production become a threat to the security of the bourgeois order’s private property.
Everything that has been established, science, technology, culture, civil society , becomes, at best, a burden. Then the accountants step forward and transfer all of these "progressive" expressions of capital into the non-performing asset category, the category marked for liquidation.
The history of the past 30 years of the petroleum industry gives this predicament at one and the same time its most crude and most distilled expressions.
When, in 1999, OPEC doubled the price of crude oil, it was another in its appearances as the 51st state of the United States. OPEC had rescued the petroleum industry before, in 1973 and again in 1979. It stepped forward again in 1999 to rescue the industry from the nightmare of its own making, overproduction; and overproduction made manifest by a precipitous drop in oil prices in 1998 as the actual market prices gravitated downwards toward the actual, and historically low, costs of production.
OPEC’s first intervention, in 1973, resulted in the quadrupling of industry profits by 1978 while the industry fixed assets expanded by 60 percent.
OPEC's second intervention, in 1979, boosted profits and financed rapid investment in the fixed assets of the industry. In 1981, oil profits recorded a peak that was seven times the 1973 level. In 1982, the fixed asset value of the industry was six times the 1973 level. That measure of fixed assets was not exceeded by the petroleum industry until 1996.
Earnings, however, slowed and after the price break in oil in 1986, the return on investment dropped below 6%. The lead-in to 1986 was a decline in the rate and mass of profits. Profits in 1984 were half the 1982 measure. The industry responded by reducing its labor force , first by 13 percent between 1982 and 1984 and then by a further 33% between 1984 and 1987.
US petroleum companies embarked on a massive divestment of fixed assets. From the mid 80s to 1993, the companies that participate in the US government’s Financial Reporting System (and account for half of total output and revenues) reported capital and exploratory spending 448 billion dollars coincident with 16% decline in their fixed assets.
The half trillion dollars in capital spending developed and deployed new technologies and methods. These advances were applied to the recovery and extraction of oil from both existing and developing fields. The application of computer -assisted 3D seismic imaging to exploration and development dramatically reduced offshore, onshore, and foreign average finding costs (calculated over three year spans) for the FRS companies. For the 1979-1981 period those costs measured approximately $24 per barrel equivalent. For the 1991-1993 period, the costs were $6 per barrel equivalent.
Advanced drilling techniques both extended the life of older fields, yielding more proven reserves, while maintaining the relatively low costs of production per barrel. The productive life of the North Sea fields was extended by at least eight years , while the costs of production fell before $4 per barrel.
Despite and because of this "progress," this immense capital investment animated by such reduced demands for labor power, the return on investment for the industry remained relatively stable, and relatively flat, and relatively low. Between 1990 and 1995, the ROI exceeded 9% only once, in the buildup to war year of 1990.
Capital spending reached record highs for the FRS companies in 1996 and 1997, due in part to the onset of massive capital combinations concentrating the industry through mergers and acquisitions. At the same time, finding costs reversed their historical decline. More technology, more money, 45% more than in 1995, was devoted to deep water offshore exploration where finding costs average twice that of onshore exploration. These costs were not only the costs of actual exploration, but reflected the increasing acquisition costs of the increasing acreage necessary for development.
In 1996, with production costs below their previous lows, the ROI finally reached double digits at 10.1% , with total profits measuring $32 billion dollars. In, 1997 the ROI grew to 10.8% despite oil prices falling $7 per barrel in the 12 months; despite/because production expanded 3.1% and consumption expanded 2.6 percent. Overproduction was the near immediate response to the recovery of the rate of return. The time, the distance between the recovery of the mass of profits, the temporary surge to the rate of profit, and the transformation of that increase of mass into a reduced rate of growth had shortened. Capital had the world on a string, all right, but the string was already at the end.
In 1998, earnings collapsed, the FRS companies’ total net income was only 40% of the 1997 mark with ROI at 3.8 percent. Capital spending was at the highest level since 1984, with mergers and acquisitions accounting for 28% of the expenditures. Again, offshore exploration accounted for the bulk of the increase in finding costs. The number of onshore exploratory wells declined by more than one-third.
When OPEC doubled its price in 1999, the Seven Sisters of the petroleum industry would have cheered, wept, danced.... if there had been seven sisters. The mergers of Exxon, Mobil, BP, Amoco, Chevron, Texaco had reduced the family by half. And these weren’t exactly sisters, but dowager empresses, having each other over for lunch, ready to have each other for lunch.
Nostalgic for its past performance, blind to its history, capital turns with desperate belligerence on the terms and conditions of its own existence. Property must be preserved, the means of production, fixed and circulating, variable, constant, breathing and mechanical, can, must, and will be sacrificed. Property first and foremost.
V. The second Gulf War has nothing to do with oil and everything to do with oil. It has nothing to do with oil as a resource and everything to do with the production of oil as a commodity. It has nothing to do with supply, demand, scarcity, depletion and everything to do with the terms of reproduction that generate supply and demand, scarcity and overproduction.
At the exact moment that history rushes forward overwhelming the categories of past performance with the reality of production organized by one class appropriating the labor of another class; at exactly the moment that private property runs up the inside of the walls of a cage of its own making; at exactly that moment when private property, when capital, marks down and scraps its own past performance of "democracy," elected government, civil liberties, of the freedoms of speech, assembly, at just that moment the left proclaims its once and future nostalgia for the husks of capitalist corn.
Just when overproduction declares that the elements of civil society have always rested on the expropriation of unpaid labor, slave and/or wage, the left dons the wardrobe of civil society and substitutes the old fashions for class analysis.
Past performance is capitalism’s substitute for history, but sooner or later, history accepts no substitutes. Then, every issue, every opposition, every problem, every solution is posed in the historical terms of class, of the exchange between labor and the instruments of production. Then every struggle is no longer a struggle unto itself but the manifestation of terms of the whole struggle, the terms of wage-labor and capital, the terms of property and revolution.
The time for the coming of such a crisis is announced
by the depth and breadth of the contradictions and
antagonisms, which separate the conditions of distribution
and with them the definite historical form of the
corresponding conditions of production, from the
productive forces, the productivity, and development
of their agencies. A conflict then arises between the
material development of production and its social form.
--Marx, Capital, vol. 3.
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forthcoming: Clothes make the man; clothes made by women
Wednesday, March 09, 2005
The way I had it figured, I figured it to be a snap. Easy as p-i-e, pie. I started figuring it in November, setting up the web site, that being the critical part of the p-l-a-n, plan. Not that I actually set it up myself. No w-a-y, way. What do I know about web sites? Nothing, nil, zero, n-a-d-a, nada. And I don’t need to know, not with the fourteen year old living downstairs, who, always needing another tattoo, one more piercing, will work like a virtual slave in the service of his self-decoration.
So three hundred and fifty bucks shorter and a day later, I have my web site, and the fourteen year old has more metal poking in and out of orifices than Christ had followers and we’re both happy. I know how to click and doubleclick so I’m in business, o-n-l-i-n-e, online, and the fourteen year old is setting off metal detectors right and left.
Armed, so to speak, with my web site, I can pretend to a certain legitimacy. And pretending makes it so, or almost so. I am virtual so I’m almost real, so I’m close enough. I get the site up and running six months before the Cannes Film Festival opens, dedicated to the proposition that there are far too many color films. The web site can be accessed at htttp://www.antiTNT.com. The home page is titled “Color Me Gone,” a nod in the direction of my youth spent in Detroit, a youth of funny days spent with funny cars, MoPar, ramchargers, slicks, Hurst shifters, etc., etc. I know just a little about cars, but that’s a whole lot more than I know about web sites, or film for that matter.
For six months, I feature reviews and lists of movies filmed in black and white, and drum campaigns attacking Ted Turner, Disney/Capital Cities-ABC, Westinghouse/CBS, GE/NBC, Murdoch/Fox/20th Century Fox, Viacom/MTV/Blockbuster, Touchstone, Castlerock, Miramax, for their wasted and wasteful use of color. Believe me, that part was a s-n-a-p, snap. What’s not to attack in that group?
For six months, I work diligently, too, at my day/night job, self-employed as I am, trading derivatives. No surprise that, I’m sure. Sometimes I think derivatives are all there are in this life.
My home page is my passport. My trading profits will be my ticket, my hotel room, my wardrobe, my breakfast, lunch, and dinner. I plan to spend every derivative derived dollar/euro on the good life, or a representation thereof, and secure in my credentials, identifying me as a professional at w-o-r-k, I will film the young women present at this celebration of the posing life, in that greatest of contributions to world peace and happiness, in their miniskirts. I am a man with a plan, even if it is just a collection of ones and zeros. And I ask you isn’t everything just a sequence of ones and zeros, ons and offs, here and theres, now and thens? Is the representation of this life more alive than the life it represents? We do what we do as a representation of what we do in order to receive the sanction to do it again. No matter how far we roam, we’re never far from home where we first learned to be spectators in the spectacle of life and of course, that home only exists on TV or a web page. Excuse me for being philosophical.
So I contact the film festival, via their web site, of course, and request accreditation as a member of the electronic media, because that’s what I am, aren’t we all? Like I predicted, it was easy as p-i-e. First the email, in French, easily translated, and then the package via international courier, a package containing my laminated press credential attached to a blue and white lanyard, a schedule of events, a map, a list of pavillions and exhibitors and an invitation to a reception hosted by the selection committee and this year’s chairperson, Sigourney Weaver.
Sigourney Weaver! Who will always be Ripley to me. Sigourney Weaver, who always looks like she just stepped out of a hologram of herself. I was in celebrity heaven, virtually.
And if I was the sort of person easily impressed with myself I might have been captivated by the charm of my plan. Posing for posers. In Cannes. Charm barely describes it. Pretending to be real where pretending is real. Charm. Charmed. Enchante. And what is charm but the ability to divert one’s attention from your hand in their pocket. You know that. They know that. Who could know that more than the entertainment industry? Besides real estate?. Or the securities industry? Or the legal profession? Or defense contractors? Or religion.
I was halfway there without taking a step outside my apartment, with barely moving a muscle, and still three months to go to my departure, via Delta Airlines, business elite class of course, from Kennedy to Cote d’Azur.
The waiting was the hardest part. For time is the enemy of all schemers, posers, plotters. Time wears away at the beauty of simplicity, the boldness of fabrication. Time also becomes expensive. Excuse me for not being philosophical here, but even the simplest of enterprises becomes complicated as the days and nights stretch on. Plans accrete layers of new plans, poses strike up thousands of new poses. Every breath becomes part of a fantasy where all breathlessly await the unfolding of your grand drama.
And it all costs money. I deal in derivatives and rarely see anything that looks like the amounts of money pretending to move in these machinations, conjurings. The amounts of real money I do actually see are so modest that I might as well be working for a living. In this I guess I am not alone.
I electronically deposit ones and zeros in a bank account, held at a bank I’ve never been inside, utilizing only the machines provided in a teller free environment for those rare occassions when I actually use currency rather than hedge currencies. I make trades that register as book entries in a brokerage account, statements mailed monthly, updated daily on the web, the value of my portfolio appearing as nothing so much as bandwidth.
I busied myself keeping my story simple, admiring my video camera, the new lightweight laptop from Sony in mauve magnesium that I would take with me, counting days down to zeros, I’m off, and dollars by the ones and zeros, I’m on my way. Off and on, zero and one, nothing and everything.
I worked my digits to the digital bone trading derivatives, currency futures, options, puts, call, spdrs, buying and selling enough to keep me in credit cards. And was I ever in credit cards.
Where the emerging capitalists of the mercantile sort measured the virtue, the glory, the power of their wealth with accumulation of gold, I measured my dissipation of somebody else’s wealth with the accumulation of gold cards. I had gold Visa cards, platinum Visa cards, Mastercards, Discover Cards, branded, co-branded, off-branded, with and without miles, with and without hotel upgrades. My favorite was the U.S. Army’s Desert Storm depleted uranium Visa card, embossed with the hologram of the Bradley fighting vehicle, and no fee.. Be all you can be, indeed. No matter what I did, I charged it. Charged it all, discharging it more often than not by transferring it to another credit card. In the business, we call that rolling it over.
I was a debtor nation all unto myself, and thereby sought out, wooed, pursued to consume ever more of the next best thing to wealth, the image of wealth, its positive negation, debt. I owed, therefore I was worth something. I had more credit with more banks than Indonesia, and on better terms.
I was not reckless. No, reckless might have destroyed all I was working for. The trip, the parties, the cocktails in the sun, the girl with more than bare legs and less than micro miniskirts. I am not a reckless sort. At any given moment I knew exactly how overextended I was which is a sign, more than less, of financial responsibility and economic maturity. Or so I’m told.
I am not a reckless person. I calculate therefore I risk. I figured I could float $180,000 in credit card debt, principal and interest, for eight years and eight months before the banks might weary of the musical chairs of debt rotation I had them playing, by which time I might be rich, famous, dead, or all of the above. Not much dread in those 3160 days of reckoning. Rather, just the opposite. I was exhilirated, feeling as though I were fashioning myself anew everyday. I felt that with each purchase I was breathing life into a pioneer me, striding across ocean and plain to...no, into the cosmic ether.
Credit, credit cards, accreditation, credentials I had it all. And the barcode on my passport, and the E ticket I wasn’t worried about losing, proved it. Charm, fraud, credit...a man in full.
Pressure? From what? Pretending to have money to pretend to pay for what I pretended to need? From keeping the digital me afloat in the modulated/demodulated sea? Please. Pressure? Nobody was shooting at me and I got to sleep in my own bed. What pressure?
So, you ask, could I tell where the real me ended and the representational me began, and vice versa?
And I answer, of course not. And what’s more, I didn’t want to. What great leader, fool, charlatan, swindler, visionary, salesman, ever knows, accepts, imposed limits? Thus spake Zarathustra, right? And Dale Carnegie.
Years ago, when I didn’t get to sleep in my own bed, or any bed for that matter and among other things, I learned the virtue of travelling light. I travel light. I hold this truth to be self-evident: everything you need should fit in one bag and that bag should fit over one shoulder. Of course it’s a flexible truth. I did not count my laptop and video camera, travelling in their own bags inside a second handheld bag, as luggage. Neither did the airline.
No cell phone, no pager, no alarm clock, no hair dryer. I was a minimalist traveler. Form and function. I felt almost Scandanavian. Six days, plus travel time. Seven sets of socks and underwear, four shirts, three pairs of silk slacks, two blue one black, one pair of jeans, five shirts, one swimsuit (pure affectation, designed to reassure any customs agent bored enough to look through my bag) extra glasses, extra sunglasses, one book, three thin notebooks, two pens, map, Rough Guide, tootbrush, deodorant, toothpaste, sewing kit, videocassettes. That was it. One bag, and over one shoulder it went. Carry it on and carry it off. Believe me, I planned to carry it off.
And cash. Or rather, cash advances, deposited into my bank account so that upon my arrival in Cote D’Azur I might freely utilize local ATMs to access other peoples’ money. Think globally, act locally. I intended to spend freely during my brief stay, for nothing endears you to the heart of a festival, which of course, is nothing but a market pretending it has a purpose other than the separation of money and fools, like freely spending. If the founding fathers had really had vision, a vision of the future, they would have incorporated, perfect word that, freedom to spend, spending freely, into the bill, perfect word that too, of rights.
So there I was, in the towncar operated by a former muhjadeen now employed by former Israelis for the purpose of driving me to the former Idlewilde Airport, knowing that I was lip-synching my way through life and comfortable with that knowledge; feeling shallow and superficial and feeling that shallow and superficial were perfectly acceptable between consenting adults. And he, former guerrilla, mustached, asking me if this will be cash or credit card. I sighed.
Sunglasses, silk slacks, silk jacket, shirt open at the neck. I looked the part. And looking the part isn’t half the battle, looking the part is total victory.
I presented myself at the check-in counter, handing over my passport, flashing a second picture ID, a driver’s license with a digitized picture of myself, a picture that could be changed in sum or in part at will. I could scan myself, if I was so inclined, rearrange the 1s and 0s and, identify myself in any way I wished. I wrote a note to myself to send myself an email once onboard the plane to redo that picture, muting some of the red that was overcoloring my cheeks, a red that was the telltale sign of insufficient memory.
After answering the usual questions about my luggage, yes, I packed it myself, no, nobody gave me anything to carry, yes it has been in my sight continuously, no I’m not angry at the world in general or Delta Airlines in particular, after making it through the metal detector (wondering why the fillings in my teeth didn’t trigger the alarm), I boarded the aircraft, business elite class, extra legroom, extra wide seat, personal entertainment center, headphones, plug and jack for the laptop. It was like home. Better than home, I didn’t have to get up to refill my drink.
I like to drink. It almost makes me social. At least, when drinking I think how I might be social, and it’s the thought that counts. I drink a lot. Actually I drink like a trooper and sleep like a baby, neither of which, I’m happy to say, I will ever ever be again. Count on it.
So as soon as my rear end hit the sit, my front end, my hand went up and the cabin attendant, a young woman so enthusiastic about her job I thought it painful, brought me the first of many glasses of champagne. No, not sparkling wine. Champagne. Some things are better real. Human beings not being one of them, I might add.
Somewhere between the champagne and the cognac, both from Rheims, somewhere between sleep and waking, somewhere been Labrador and Ireland, my mind started to run down those paths that link to paths that link to paths that provide answers to questions not even imagined. Speech passes into sensation, thought into music, almost. I thought, or dreamed, or breathed about the boundaries between presentation, representation, and fact, about blurring the boundaries between creation and forgery, deception and love, fashion and fashioning. Was the blurring art, or money? Was one possible without the other? What, after all, could make everyone believe in the simplest and greatest fraud? Art? Money? Television? What was the difference, anyway. Inspiration? Please, we’re not muhjadeen here, are we? Nothing inspires like money, except maybe a rifle shot, but these are happy times. I felt happy, practically, paralyzed with my own good fortune.
Money. I had something that looked, acted, worked like money. Now I could present myself as my own creation, my own fraud. I believed in that presentation, and I could put somebody else’s money where my mouth was, and who could or would disagree with me? Not even communists could resist the power of money. Then I knew, in that state, cruising at 31,000 feet, air speed 562 miles per hour, globally positioned over the Atlantic, almost, not quite, snoring, not far from drooling, that god was very rich for all those billions to believe him. And I knew also that all of Cannes would be glad to see me, carressing me, feeling that lump in my pants... “Are those your credit cards or are you just happy to see me?” Both!
When we landed, the officer at passport control, light blue shirt, navy blue pants barely glanced at my passport, sighting first on my film festival credentials, waving me through. “Another one,” I heard him think, “I hate this time of year.”
But I love May on the Cote d’Azur. The light, the most perfect light rains down in sheets thick enough to laminate water to earth to sky, filling in crevice, gorge, streets, and old wounds with a crystalline balm. The wind slaps at the water, palms flat, then draws it up into the sky, in talons fashioned over Africa, hurling a mist that shatters into the sound of a thousand bells ringing softly. The sun rises and sets like the master of a very unruly household, calling all to order. May on the Cote d’Azur is almost real enough to be artificial. It can’t be real I keep feeling which is just perfect.
Thirty minutes after landing I was in my rented Fiat, driving west along the N98 to Cannes. If the truth is to be known, as if truth ever needs to be known, I would have preferred to stay in Nice. The light is even more perfect in Nice. There is so much more to do in Nice you feel fulfilled in practically doing nothing. The Promenade is the perfect place to feel doing nothing, save raising your glass to your lips, your face to the sun, and your thoughts to raising the skirts of the women promenading, styling, by , with thoughts of their own.
So near Cagnes-sur-Mer, I swung the Fiat around and headed back to the east. It was still morning. I wanted to go to Nice and who but me would ever care what the real me wanted, even if I wasn’t too sure any longer who the real me was. But something sitting very close to me in the rented Fiat wanted to go to Nice, to sit on the Promenade, sunlight washing, no, suckling me. And in the end, isn’t it all about the light? Wave or particle? On or off? Light and sand, silicon and optics, all the same.
Along the Promenade I drove, turning off and parking on Rue Meyerbeer, feeding the meter, placing the receipt on the dash, stretching, smiling at my good fortune.
On the promenade, just down from the interesection with Meyerbeer is a little snack bar/glacier called Pomm. The owner, a man of cautious smiles, unfailing courtesy, Algerian descent, often stares longingly across the water, tasting a bit of his Africa in the wind. His little space, four tables outside, two inside (in Spring and Summer) is perfectly placed for the maximum exposure to daylight.
When I first visited Nice, I took every meal at Pomm. We became friends, speaking of New York, Paris, Algiers, the demise of empire, and the costs of nationalism. Extraordinary conversations catalyzed by vin ordinaire, carried on under a sun that pushed itself, like a wind, into every crevice, every opening.
He, setting his tables out in this morning’s sun, betrayed no surprise at my sudden appearance, smiling, shaking my hand, hugging me, as we exchanged kisses. He pulled a chair away from the table and I sat, surrounded by the noise of the traffic, the people walking their dogs and the Mediterranean sweeping across the rocks and pebbles of Nice’s industrial strength non-beach.
B. brought out the cafe noir, the Badoit, the pichet of rose wine, the basket of bread and the charcuterie. He sat across from me and poured the wine into two glasses. We toasted and drank and I explained the purpose, if you could call it that, of my visit, my date with destiny in Cannes. He was amused. It was so foreign, so American, to him, to pretend to have some real business at a carnival of pretenders. He laughed and shook his head. Why not stay in Nice, at his place, he asked? I thanked him but declined. No, I am accredited, almost official. I had to stay in Cannes. When in Rome, and all that... I let the words dissipate in the wind, like smoke from an extinguished match.
We finished our coffee, our water, our wine, bread, and cold cuts, exchanging information and the latest news from New York, Nice, and Algiers.
“My friend,” said B., “a bit of advice. If you carry your video camera with you, no young women will talk to you. They’ll think you’re Russian. The Russians film everything here. They film everyone walking along the sea. They film the waiters. They film the food. They film each other eating the food. They take the film home and show it to their friends during their long cold winters. I think they feel warm when they watch themselves on their VCRs. Remember how, sometimes, on a particularly dreary day, we would open a bottle of rose, and sort of warm our hands with the memory of sunlight coming from the bottle?”
“Or find the perfect bottle of olive oil and dip bread in it?”
Again I nodded.
“I think it’s like that for the Russians. Keeping warm by the glow from their televisions.”
“I understand,” I said. Indeed I did. Sunlight on a magnetic strip.
“Yes, it’s understandable, but it scares the young women. You don’t need to carry the camera. Your credentials around your neck will make sure you never drink alone.”
Good advice. I thanked him. I paid the bill and as I rose to leave, he brought out a bottle of Bandol rose, pressing its chilled neck into my hand.
“Enjoy yourself,” he said in English.
I walked back to my Fiat swung around to the Rue du Congres and headed back to the Promenade, emerging in the westbound lanes. Ahead of me and to my right was the Hotel Negresco, looking like nothing so much as a Hollywood studio model of a home away from home for the last Czar and Czarina.
A banner waved from the dome of the hotel, “Welcome Romanoffs,” I imagined it to say.
Now here was a winter palace. Imagine the strategy sessions with the hotel publicist.
“We must advertise. ‘Playground of the British pseudo-aristocracy.’ ‘Innkeeper of choice to all ancien regimes.’ Lets find someone claiming to be the Dauphine and use him as a greeter.”
I took my time driving the thirty five kilometers to Cannes, savoring every bit of light and water that presented itself in inexhaustible supply, enjoying the brightly colored pink and blue dolphins at the Tex-Mex Cantina/Disco on the beach just outside Cros-de-Cagnes, slowly driving through, not around, Antibes and Juan-les-Pins, entering Cannes like a lost boy coming home.
I had selected the Hotel Cristal as my base of operations. The hotel is set back a long city block from the Promenade de la Croisette, and as I had expected the Promenade was almost unnavigable with bodies upon bodies undulating in place, straining to be somewhere else in the long chain of flesh. I knew I would actually have to spend more time than usual, than I liked, with actual people and so I chose a hotel, of unquestionable quality, that afforded some refuge from participating, some basis for observing.
On its sixth floor, the hotel offers an unobstructed view of the Croisette, the harbor, the big boats, the beaches, the sea of blue and white umbrellas planted like flags on the moon, if the moon had a beach. After, during, between a hard day’s/night’s taping, I could retreat, without my camera, with my credentials, and with one of my stars to the safety of the bar and watch the crowds below.
I checked in, presented my super-platinum platinum Visa, my passport, my credentials, and received my room key, seven pounds of press releases, party invitations, schedules of showings, maps, and a phrase book.
Once in the room, I showered, changed into my work silks, and took a minute to gather myself, which meant, of course, opening the bottle of Bandol, pouring a glass, placing the bottle next to the bottle of champagne thoughtfully provided by the hotel in a bucket of ice and congratulated myself.
I had made it from New York to Cannes. I was here, there, an ocean away, and home almost free, all at the same time. I shared a toast with myself, savoring the wine, and then, gathered a pen and notebook and headed down and out into the crowds and to Palais des Festivals, to check in once again and get my photograph laminated to my credentials, proving that I was indeed the person I pretended to be.
And crowds there were. In the harbor, on the beaches, on the Promenade. A sea of flesh in various degrees of dress and undress rose and fell sympathetically with the little waves rolling onto the beach. There were your film types of course, wearing, I think, contact lenses made from crystal to get the extra ounce of shine and sparkle in their eyes. There were your film type admirers of course, trying to look like film types. There were your abnormally good looking men and women who appeared to have nothing quite as important to do as to look exactly the way they looked.
There were your normally good looking 40-50 year olds. The women were wearing three inch high heeled sandals. The men were wearing skin the color of their belts but not quite as soft.
There were your abnormally rich people, slumming, so to speak, by moving in the midst of so many people of ordinary wealth or no wealth whatsoever, totally pleased by their discomfort, totally comfortable knowing at any moment they could cross the road and return to their yachts, their suites.
There were your normally rich people, easy to spot because they travelled as couples, the women dressing well and the men wearing pressed pre-faded jeans and loafers.
And then there were your legions of young people, girls and boys, young men and young women, from all over Europe and the Americas. The girls were dressed to show the wealth of their youth, a wealth the abnormally rich could never purchase, the girls wearing shorts, sandals, miniskirts, minidresses. I filmed them all in my mind. The boys wearing.... Well, boys don’t know anything about dressing do they?
There were big men in yellow silk jackets, looking like misplaced traders from a commodities pit, yellow silk jackets and black silk tee shirts and bald spots.
There were crowds of people buying sweaters and denim jackets just so they could tie them around their waists.
There were men and women who composed their hair according to instructions accompanying magazine pictures of film stars and models.
There were men who thought they looked good, looked better, with their shirts open to fourth button and necklaces hanging down to the third.
And Cannes spoke to each and everyone of these people, whispered to them, crooned, lullabied, promised, each and all a chance to promenade, to drink, to dance, to really pretend.
Cannes said: Send more of those people who own big boats. Send more of those women in tight pants and men in cowboy boots. Send them from Britain, from Denmark, from Spain, from Italy, from the United States, from Argentina,we love to tango, from Canada, from Japan, from Israel, Lebanon, from Syria. Send them all.
This scene rolls by like a spool of thread unwinding with no end, hour after hour. So there I was, a poser cork floating in a poser sea. I thought, in a flash of paranoid recognition, that somewhere out there in space, light years away, there was a predator looking down at this endless stream of meat, looking down and drooling all over his telescope.
I crossed the Croisette to a strip of green clogged with white canvas pavillions, the structures advertising the studios, production companies, banks, telecommunications corporations, TV networks, cable TV networks, so essential to big money entertainment. At every one of these, my credentials secured me entrance to the private areas were the champagne flowed freely. It was there making the smallest of small talk that I revealed my purpose, committing to videotape the importance of the miniskirt, to those others drinking big and talking small.
Stating that the miniskirt was an event of world-historical importance was probably not what Hegel had in mind when formulating the notion of world-historical. But Hegel was an idealist. I am not. Every heterosexual male knows what’s world-historical is his world. Was this project adolescent in origin and scope? No doubt about it. But lets be clear. Who uses the web? Who determines its content? Adolescent boys. Where was my tape going to wind up? Where does everything end up? The web. The logic was irrefutable.
Dressed in my silks, my sunglasses, my credentials, I walked around the old port and back to the Alles de la Liberte where I picked a seat in the sun in a cafe that served faux tropical drinks in plastic margarita glasses, tilted the sunglasses up on my head and waited, smiling at every woman who looked my way.
I didn’t have to wait long. They sought me out, or rather they sought out my credentials. They came in sandals and heels, and boots, and espadrilles, and after a few words and the exchange of phone numbers and addresses and agreement on time and place, they were off, to check their clothes and prepare for the next days filming.
I taped them. I taped them, over the course of the next couple of days, walking. I taped them sitting, crossing their legs, getting up from the table, smoothing their skirts. I taped them climbing uphill to the Musee de la Castre. I taped them walking cautiously downhill to the Boulevard Jean-Hibert.
They were twenty years old, thirty years old, forty years old, even fifty years old. They were brown, red-brown, yellow-brown, pink-brown, black-brown, white-brown. Africa really is mother to us all .
They walked into the water in their miniskirts and dresses and walked back out, the fabric clinging to their legs in a way that was as beautiful as exposed skin. And after filming, we always had a drink, a toast to the way women walk.
I did not, however, attempt to take advantage, or force myself on any one of them. Not one of them ever felt the need to sleep with me to conclude our arrangement. As a youth I had never wanted to be President of the United States, and I certainly wasn’t going to pretend I was one now.
Every woman was given my card, my phone number, my address and was promised a copy of the tape. A promise, by the way, which I have honored.
I was there to film them not sleep with them. That’s the way I wanted it. Until I met Danielle.
It was at a rooftop party held on a rooftop so perfectly situated on a night so laden with warmth that it made me think that if god was going to get married this is where he would have the reception. The night smelled like a baby’s breath. The wind gurgling, playing with its own fingers, taking you on its arm, leading you from conversation to conversation. The sky, painted in shades of slate blue, dropped down, draped itself around our shoulders and licked us with a tongue dipped in seawater. Marty was at the party. Dirk and Dick. Pedro, Pietro, Isabella, Luke, Luc, Sigourney.
I was just standing there, drinking something that might have contained alcohol, eating something that definitely contained salmon when Sigourney came over to me and pulled me aside.
“I heard about your project,” she said.
I was flattered. Imagine, Ripley, third officer of the Nostromo, seeking me out.
“Are you interested?” I asked.
“What? Me? Oh no. But Danielle wants to meet you.”
“Great,” I said. “Who’s Danielle?”
Sigourney leaned across me and nodded toward a tall woman in simple blue summer dress, espadrilles and long dark hair. Sigourney waved. Danielle waved back and walked towards me. I don’t know why but I felt suddenly uneasy, almost dizzy. The feeling confused me.
“She’s a singer from Israel,” said Sigourney. “She won the Eurovision sing-off contest this year.”
I was impressed. “You mean,” I stammered, “the same Eurovision contest won in 1974 by ABBA singing their smash hit “Waterloo?”
Sigourney paused. “I don’t really know. I guess it’s the same one. Let’s ask her.”
By which time Danielle was standing directly in front of me with her hand extended. She was beautiful with legs that were sublime. Her skin was more brown than olive. Turkish ancestors, I thought. I took her hand in mine and felt something go through me that I had never felt before, well maybe once before when I had thought, mistakenly, that I had won the New York State Lottery but misplaced the ticket. Turned out, I had the ticket but not the numbers.
We stared at each other. She took my arm and said in English. “Let’s go for a walk.”
We walked to the harbor, gazing at nothing but each other. We hardly spoke. Our connection was immediate, direct, instantaneous. It was hard to believe. Actually it was impossible, like winning the lottery.
I know what it was about her that attracted me. Her long black hair, her almond shaped and colored eyes, her perfect legs. I was so consumed with her beauty that I didn’t ask myself what attracted her to me.
We spent that entire night together. Talking as little as possible. Touching much more and for much longer than I am usually comfortable. It had to be love. Total, immediate, ignorant. Only flesh could make itself so vulnerable.
The next morning we met after breakfast. The three of us, Danielle, me, and my camera. We walked along the sand beaches of the Plage du Midi, she smiling with every step I filmed. We feasted on olives, tomatoes, bread, cheese that we purchased at a street market. For two days, we did everything that had nothing to do with the festival. And on the third night, in my hotel room, we made love. We made love like we were born to each other, like we had been sculpted, both inside and out, to fit each other exactly and nobody else. Tongue to tongue, hand in hand, leg around leg.
After breakfast, I walked Danielle back to the Carleton Intercontinental where she was staying. She had an appearance to make and we were to meet later in the day. I returned to my hotel and sat dreamily on the balcony, dulled to anything but the sense of my own well being.
The phone rang. The voice at the other end spoke Israel-accented English, and sounded like it was speaking it through a handkerchief. The voice belonged to Danielle’s brother, who, accompanied by Danielle’s other two brothers asked to come to my suite and speak with me. Family members? Family is one thing I never counted on. In this world of presentation and representation, of self and more self, I assume that everyone just leaves family out of it.
But then there was the knock at the door. I opened it to reveal three identical looking men. Height five feet ten inches. Weight about 187. Hair, black, curly. Eyes, brown, almond shaped. Skin, almond. Turkish ancestors, I thought.
The brothers dressed identically, white shirts open at the collar, sand colored slacks, navy blue jackets. They pushed against each other to be the first through the doorway and into my room, wrinkling their slacks and jackets in the effort. I stood back and waited. Finally after they, more than less, tumbled into my suite and lined themselves in one rank, 1,2,3 left to right, brother number one spoke.
“What are you doing with our brother?”
Then number two interjected, “Our sister?”
And number three chimed in, “Both?”
Brother? Sister? Both?
“What are you talking about?”
“We want to know what your intentions are towards our brother.”
“Sister,” said number two.
“Whatever,” said number three.
“Don’t pretend you don’t know who we’re talking about,” said number one.
“Maybe he doesn’t know what we’re talking about,” said number two.
“How could he not know?”, said number three.
I wasn’t pretending. I had no idea what they were talking about. “Brother? Sister? Both? What are you talking about?”
The brothers looked at each other.
“Are you sleeping with him?”, said number one.
“Her,” said number two.
“Either/or,”said number three.
They looked at each other again.
“He doesn’t know,” said number three.
“ Doesn’t know what?” I demanded.
The brothers looked at each other and at me. Then they spoke in unison. “Danielle was our brother, before she had the operation. Now she’s our sister. She’s transgender.”
I stared at them. “I don’t believe you. We’ve been together for days. I would have noticed something, scars, irregularities.” Indeed, I noticed something. I took it for perfection.
“Not at those prices, you wouldn’t,” said brother number one.
“It wasn’t cheap,” said number two.
“Which brings us to the business at hand,” said number three. “She is a pop star. She is here at the most famous festival of stars and she should be working. Instead she spends her time with an unknown Ejournalist! She’s wasting her hard earned self.”
“Right,” said number one. “She should be photographed in the company of Sylvester Stallone.”
“Sharon Stone,” said number two.
“Both,” said number three.
I was silent. Stunned. And awed. Danielle had done with her own flesh and blood what I had attempted to do with ones and zeros. And she had succeeded. What commitment to illusion, what authentic artifice, what synthetic realism, what balls! If I hadn’t been in love before, I certainly was now.
“So,” said number one, “what are your intentions.”
“Strictly honorable,” I said.
“I was afraid of that,” said number two.
“Would you marry him?”
“Her,” I corrected before numbers two and three could speak.
“If she’ll have me,” I said.
“And ruin her career?”, said number two. “You call that honorable?”
I didn’t know how to answer that.
“You Jewish?”, asked number three.
“Not exactly,” I said.
“What kind of answer is that?”, said number two. “How can you be ‘not exactly’ Jewish?”
“Well, I think one of my grandparents might have been Jewish, and my brother married a Jewish woman, but he’s dead now.”
“Figures,” said number one.
“Well, that settles it,” said number one. “You’re not Jewish. It would kill our parents if Danielle married a goy.”
I understood. Radical surgery and gender transformation are acceptable, but marrying outside the faith is a crime.
“If you love Danielle,” said number three, “you’ll leave her alone and let her make the name and money for herself he/she/both, whatever, deserves.”
“And if you attempt to see Danielle, we’ll have you arrested as a stalker.”
“Or maybe we’ll just take care of you ourselves,” said number three. “Israeli paratroopers,” he said, as if he were identifying himself to school children.
With no further words, they turned to leave, bumping into each other again at the doorway before spilling out into the corridor.
As soon as they left, I called Danielle. The phone rang. And rang. And rang some more.
I walked over to the Intercontinental and left a message. I called again. Nothing.
I saw Danielle the next day, at a press conference, surrounded by her brothers, answering questions about stories of her simultaneous affairs with David Bowie and Grace Jones. I knew her brothers had planted the stories. The whole scene was so dishonest I could have puked.
That’s when I realized I was in trouble. Since when did I require honesty in marketing? I had almost felt something that might have been real and it threatened my whole world.
As Danielle left the press conference, I called to her. She turned to look, but brothers one and two, on either side of her, took her arms and hustled her out the door. Brother three came over and punched me sharply in the gut. It might have hurt had I not been so distracted. Before he could punch me again, I stamped down hard on his foot. He began to crumple. On his way down I grabbed his ear, twisted sharply, pulled his head back and grabbed his trachea.
“New York East Villager,” I said. “Fuck your airborne ass.”
I had to leave Cannes and I did. I wasn’t just going through the motions any longer, my heart had gotten into it, and that could have ruined me forever.
I drove back to Nice that next day, took a room at Hotel L’Oasis and explained the whole sorry story to B.
He shook his head. “What are you going to do?”
I shrugged. “I’m not sure. Maybe I’ll try to get out less often.”
“Is that possible?”
“It’s possible all right.”
“Life’s a funny thing,” he said. “There’s no explanation for the passions of the human heart.”
“Yes,” I agreed. “Very funny. A regular laugh riot. What’s that phrase? Best laid plans of....”
I finished my wine and walked across the Promenade to sit and stare at the coastline of an Africa far beyond my vision. Thinking of the best laid plans of... a man with a mouse.
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