19 Oct 2010

On Lies, Big Lies, and Statistical Averages

by Zygmunt Bauman

Learning from the past, especially from past mistakes and misdeeds, does not come easy – particularly to those who made those mistakes and committed those misdeeds.

One year ago Alex Berenson noted in the NYT “little change on Wall St.” Today, he could surely reprint that conclusion unaltered, only with a swollen factual backing… He could repeat that “the biggest banks have restructured only around the edges”, and that the pay of bankers, responsible for the two-years old catastrophe yet unpunished for their misdemeanour, is back to, if not above, its pre-crash levels, with 30 thousand Goldman Sachs (the company that was bailed by the federal debt from the threat of bankruptcy) employees earning on average $700.000 a year, and eight major American and European banks (according to Kian Abouhossein, a J.P.Morgan’ analyst) paying on average $543.000 to their 141 thousand employees. The “system”, whatever that word may mean in a thoroughly deregulated setting, would not budge. “Investors will lend money to the financial industry on easy terms. In turn, financial institutions will use that cheap money to make risky loans and trades. The banks will keep the profits when their bets pay off, while taxpayers will swallow the losses when the bets go bad and threaten the system”. Bankers have even a special term for that tactics – I.B.G.: by the time of the bets being lost, “I will Be Gone” (with a handsome bonus of course, and platinum handshake). This is the other face of the labour market’s deregulation that has already cast millions of workers, and continues casting yet more daily, into prospectless poverty; or, to borrow Peter S. Goodman’s phrase, into “the deserts of joblessness”.

It is a desert – for the 15 million people declared redundant, about 3 million of whom have already seen their unemployment assistance expiring and many more watch in despair the same predicament relentlessly approaching. In their lives, unlike on Wall St., everything has changed, and beyond recognition. People promised (fraudulently, as they find out now) middle-class income and allured into middle-class spending, have now no other choice except to hope for public- assistance lifeline. But even that hope – their last – grows tenuous by the day. 44 states cut off welfare checks for anyone in households with total income less than one quarter below the official poverty line. As Randy Abelda of the University of Massachusetts calculated, entitlements to public assistance stop when a family of three reaches £1.383 a month (though by the time of my writing they might’ve fallen down again.)

Crises are reputed to strike at random, but their consequences, and above all the long-term consequences, are class-managed… Severity of crises may result from the intensity of deregulation, but the harshness and pungency of their human effects stays stubbornly class-controlled – and tightly.

Quite similar trends mark almost all parts of our de-regulated globe. As Margaret Bounting notes in the trenchant warning addressed to the impending session of the UN, “at the current progress more than a billion of the world’s population will still be living in extreme poverty in 2015; half of all children in India are malnourished; in sub-Saharan Africa, one child in seven dies before their fifth birthday…(T)he goals are bypassing the poorest in the world… (T)hree quarters of the world’s poorest now live in middle-income countries such as India or Nigeria.” While the “UN prefers to talk of global inequality rather than the inequality within developing countries – India, for all its feted economic growth, has barely touched the proportion of those going hungry in the last 20 years”… The idea of “equity”, let alone of “equality”, most of the UN members and managers wouldn’t touch with a barge pole.

We go on routinely, duly and diligently computing statistical averages. Some of the averages are encouraging, a few are downright delightful and even justifying some degree of self-congratulation. Some others are considerably less heart-warming, whereas a few signal abominable failure and inspire questions to which no good answers have been found (or for that matter sought in earnest) thus far. But the statistics of collateral victims of the markets’ free-for-all and catch-as-you-catch-can – the poor and hungry left out of the enrich-yourself thrust of the rest and badly hit by its results – are routinely, invariably, stubbornly and monotonously dismal and dreary, and with each successive fit of economic depression ever more so.

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