imc indymedia

Los Angeles Indymedia : Activist News

white themeblack themered themetheme help
About Us Contact Us Calendar Publish RSS
Features
latest news
best of news
syndication
commentary


KILLRADIO

VozMob

ABCF LA

A-Infos Radio

Indymedia On Air

Dope-X-Resistance-LA List

LAAMN List




IMC Network:

Original Cities

www.indymedia.org africa: ambazonia canarias estrecho / madiaq kenya nigeria south africa canada: hamilton london, ontario maritimes montreal ontario ottawa quebec thunder bay vancouver victoria windsor winnipeg east asia: burma jakarta japan korea manila qc europe: abruzzo alacant andorra antwerpen armenia athens austria barcelona belarus belgium belgrade bristol brussels bulgaria calabria croatia cyprus emilia-romagna estrecho / madiaq euskal herria galiza germany grenoble hungary ireland istanbul italy la plana liege liguria lille linksunten lombardia london madrid malta marseille nantes napoli netherlands nice northern england norway oost-vlaanderen paris/Île-de-france patras piemonte poland portugal roma romania russia saint-petersburg scotland sverige switzerland thessaloniki torun toscana toulouse ukraine united kingdom valencia latin america: argentina bolivia chiapas chile chile sur cmi brasil colombia ecuador mexico peru puerto rico qollasuyu rosario santiago tijuana uruguay valparaiso venezuela venezuela oceania: adelaide aotearoa brisbane burma darwin jakarta manila melbourne perth qc sydney south asia: india mumbai united states: arizona arkansas asheville atlanta austin baltimore big muddy binghamton boston buffalo charlottesville chicago cleveland colorado columbus dc hawaii houston hudson mohawk kansas city la madison maine miami michigan milwaukee minneapolis/st. paul new hampshire new jersey new mexico new orleans north carolina north texas nyc oklahoma philadelphia pittsburgh portland richmond rochester rogue valley saint louis san diego san francisco san francisco bay area santa barbara santa cruz, ca sarasota seattle tampa bay tennessee urbana-champaign vermont western mass worcester west asia: armenia beirut israel palestine process: fbi/legal updates mailing lists process & imc docs tech volunteer projects: print radio satellite tv video regions: oceania united states topics: biotech

Surviving Cities

www.indymedia.org africa: canada: quebec east asia: japan europe: athens barcelona belgium bristol brussels cyprus germany grenoble ireland istanbul lille linksunten nantes netherlands norway portugal united kingdom latin america: argentina cmi brasil rosario oceania: aotearoa united states: austin big muddy binghamton boston chicago columbus la michigan nyc portland rochester saint louis san diego san francisco bay area santa cruz, ca tennessee urbana-champaign worcester west asia: palestine process: fbi/legal updates process & imc docs projects: radio satellite tv
printable version - js reader version - view hidden posts - tags and related articles

The Useful State

by Robert Misik Wednesday, Sep. 16, 2015 at 5:02 AM
marc1seed@yahoo.com

With slogans like "Less State, More Private," the state was run down for years. Neoliberal ideology managed to present it as a bureaucratic monster. Banks were bailed out. In the emergency, the most wicked neoliberal becomes the state fan. The history of innovations shows the state takes risks

THE USEFUL STATE



By Robert Misik



[With slogans like “Less State, More Private,” the state was run down for years. The state is the most important motor for innovation and economic competitiveness. This article published on July 10, 2015 is translated from the German on the Internet, http://misik.at/2015/07/der-nuetzlich-staat/. Robert Misik is a journalist and independent political analyst based in Vienna and won the Austrian State Prize for Cultural Journalism in 2009.]



After thirty years of ideological barrage, the state doesn’t have a good name or reputation. Neoliberal ideology has managed to present it as a bureaucratic monster that lives off “the economy” with high taxes, dubious economics and waste. This is condensed in the simple slogan “Less State, More Private.”



In the popular gutter press, the anti-state slogans fell on fertile soil. Here politicians and civil servants are represented as lazy idlers who blow “our money.” That the state often faces many citizens as a bureaucratic monster in whose net one is caught or is encountered as a gruff official or policeman makes it easier to move it in a bad light.



All this is rather absurd when you consider managers of banks and businesses immediately called for the state when the water reached their necks. Very selfishly, the taxpayer is roped in to save his own manager job and the impacted state. In the emergency, the state has the task of preventing a total collapse. In an emergency which means beyond the normal case, the wicked neoliberal becomes the state fan. “We are all Keynesians when we sit in foxholes,” said Nobel Prize winner Robert Lukas, one of the leading neoliberal economists at the peak of the financial crisis. He alluded to John Maynard Keynes’ economic theory said to be dead for decades that emphasized the importance of the state in economic life. In normal times, the state beautifully trimmed and as passive as possible should stand on the sidelines ready to leap in case of catastrophe.



The simple dogma “The economy is done in the economy” – that private enterprise businesses ultimately ensure employment, growth, investments and innovation – is false in normal times. Still we hear again and again that brilliant tinkerers in start-ups – computer inventors like Bill Gates in their legendary garages where they found innovative businesses and then became world market leaders who carefully worked out economic ideas that lead to growth.



Mariana Mazzucato, a research economist in Great Britain, was a new star of economics by showing in detail how false is this picture. This picture is not true for the real core of economics – the development of new products and revolutionary innovations, Mazzucato said. Nothing is more false than regarding the state as “sluggish” and “heavy-going” and businesses as “competitive” and “innovative” – even if we are still drilled in this today.



The whole history of great innovations from the railroad revolution to energy production and from nuclear energy to the massive exploitation of water power shows convincingly that the massive mobilization of resources and the basic research leading the way were rendered by the state…



This is true for the great innovations of the recent past and present like computer technology and space travel. There is a systemic reason for this, Mazzucato explains. Great technological revolutions devour an incredible amount of capital. Whether profits arise some time or other is usually unclear. This is much too risky for private investors. Only the state can take such an enormous risk. The state is not slow and businesses are not entrepreneurial; the opposite is true. Businesses are much too cautious. Only the state which is much more “dare-devil” than businesses takes such risks. Businesses are generally fixated on the profit in the next quarter. “Even in boom phases there are many risk-laden areas where private businesses are timid and the state leads the way as a pioneer.”



Mazzucato’s impressive message is: forget the start-ups! Their role is systematically exaggerated!



Apple Corporation which Mazzucato describes in detail is exemplary for all this. The firm is regarded a classic example of the innovative genius of free enterprise. However the exact opposite is true. “Not a single technology in the iPhone was not financed by the state.” Computer technology was developed in laboratories of combined state and private research in the 1960s and 1970s. Micro-processors, semi-conductor technology, everything was based on state basic research and state-orchestrated innovation. As everyone knows, the Internet originated out of a mega-project of the US Defense Department. The Touch-screen was essentially developed in British laboratories committed to defense-related technologies like GPS-satellite technology. The private enterprise work lies in the final configuration, the ingenious design – and the marketing that persuades us we cannot survive any more without all these things.



Although all these facts are known (or at least could be known), nearly all of us have a false picture of the state and businesses in our heads which is the result of ideological blindness or delusion. A successful innovative capitalism always needed a strong, activistic state. The more complex the tasks and societies, the more a strong activist state, a combination of state and entrepreneurial activism is necessary, good businesses and a financially well-endowed state that acts intelligently.



There is a rather simple reason why businesses that owe their economic success to the state want to make us believe this success is primarily the result of their economic brilliance. The myth legitimates their attempts to pocket the largest piece of the wealth. Those companies that profit extremely from state research and innovation and from state training of their skilled workers then shift their corporate headquarters to tax havens. This completely legal form of tax fraud leads to a multinational like Amazon, for example, paying 3.2 million in taxes despite sales of 8.7 billion euro in Germany (less than 1/25 of 1% of its sales since 1% would be 80 million!). How much the shrewd money-shifting actions of big multinationals cost globally is “hard to estimate but the damage is several times the cost of private tax evasion” in the words of economic researcher Gabriel Zucman. Zucman who grapples with tax avoidance puts the costs to states at 130 billion euro annually.



The legitimation of such practices assumes an ideological operation that turns reality upside down. They want to persuade us wealth is produced by private enterprise businesses and then unjustly appropriated by the state via taxes. But in reality the wealth is produced socially and then appropriated privately by business advisors, managers or shareholders.



By the way support for low-tax policy for businesses is not the only selfish reason why the profiteers of neoliberalism run down the state. As the second reason, privatizations should be carried out in which public assets move into private pockets at giveaway or cut-rate prices. These highly corrupt processes are regular predatory attacks in which neoliberal politicians and “big business” divide the spoils. All this occurs in the background while those on the front stage sing the beautiful song that the state cannot be economical and businesses in private hands are much more efficient.



The relation of the state and big business should be symbiotic but is increasingly parasitic. Apple as well as mammoth pharmaceutical companies and other techno-giants transform research and technological innovations speeded up with tax funds into private profits but tell the same taxpayers “innovation and economic growth are owed to individual geniuses” (Mazzucato) and organize their global production so their profits only fall in tax shelters. Hiding the real innovation history, Mazzucato says, helps withhold part of its profits from the state. Thus its financial success is dubious and requires blinders and ideological myths.



The state is chronically run down but is vitally important for the success of businesses. In a very direct way, the state conducts basic research for innovation by developing practically all the components so businesses only have to combine them. However the state is important in another, more indirect way. It provides for the infrastructure that businesses need (a business with its products could not do much without streets on which customers depend and good schools that form the view of businesses are an “investment in human capital” that they do not have to pay for themselves.



The state looks after a good consumer climate with the many other tasks it carries out. For example, a social policy that gives receivers of low and medium incomes a larger part of the cake through redistribution stabilizes consumer demand because these social groups consume a larger share of their income than the top earners. For the same reason, strong unions have a useful economic function. This is similarly true for the most generous unemployment benefits or state measures against unemployment (like financing short-time work in case of crisis). All this prevents every depression in the economy from having an immediate effect on purchasing power which would only intensify the crisis.



For all these reasons, “trimming” the state would be nonsense. This is not even possible in reality in developed economies. Thus the state share – the sum of all payments in a society that pass “through the hands of the state” – is around 38% in the US, 44% in Germany, 50% in Austria, 34% in Switzerland and 45% in Great Britain. These differences are probably an expression of statistical deception. Since the health system is organized as private enterprise in the US and Switzerland, it is not counted in the state share. If the health system were added to its costs, the share would be around 45 to 50% similar to Germany or Austria. States with a lower state share are not among the most successful nations. The Sudan with 12% and Uganda with 18% are extremely “trimmed” states. Whoever thinks the state should keep out of the economy could test this and move to such a state for a few months.



The state prevents individuals from being exposed completely unprotected to the raw wind of the market. The state can certainly be a danger to freedom when it tends to the authoritarian or to bureaucratization. But as a democratic constitutional state, it is also the only guarantor of freedom that has been discovered up to now.

Report this post as:

Local News

GUIDE TO REBEL CITY LOS ANGELES AVAILABLE A12 5:39PM

lausd whistle blower A10 11:58PM

Website Upgrade A10 3:02AM

Help KCET and UCLA identify 60s-70s Chicano images A04 1:02PM

UCLA Luskin: Casting Youth Justice in a Different Light A02 11:58AM

Change Links April 2018 A01 11:27AM

Nuclear Shutdown News March 2018 M31 6:57PM

Join The Protest Rally in Glendale on April 10, 2018! M29 7:00PM

Join The Protest Rally in Glendale on April 10, 2018! M29 6:38PM

Spring 2018 National Immigrant Solidarity Network News Alert! M19 2:02PM

Anti-Eviction Mapping Project Shows Shocking Eviction Trends in L.A. M16 5:40PM

Steve Mnuchin video at UCLA released M15 12:34AM

Actress and Philanthropist Tanna Frederick Hosts Project Save Our Surf Beach Clean Ups M06 12:10PM

After Being Told He's 'Full of Sh*t' at School Event, Mnuchin Demands UCLA Suppress Video M02 11:44AM

Resolution of the Rent Strike in Boyle Heights M01 6:28PM

What Big Brother Knows About You and What You Can Do About It M01 3:30PM

Step Up As LAPD Chief Charlie Beck Steps Down F14 2:44PM

Our House Grief Support Center Hosts 9th Annual Run For Hope, April 29 F13 12:51PM

Don’t let this LA County Probation Department overhaul proposal sit on the shelf F13 11:04AM

Echo Park Residents Sue LA Over Controversial Development F12 8:51AM

Former Signal Hill police officer pleads guilty in road-rage incident in Irvine F09 10:25PM

Calif. Police Accused of 'Collusion' With Neo-Nazis After Release of Court Documents F09 7:14PM

Center for the Study of Political Graphics exhibit on Police Abuse posters F07 9:50AM

City Agrees to Settle Lawsuit Claiming Pasadena Police Officer Had His Sister Falsely Arre F04 3:17PM

Professor's Study Highlights Health Risks of Urban Oil Drilling F04 12:42PM

Claims paid involving Pasadena Police Department 2014 to present F04 10:52AM

Pasadenans - get your license plate reader records from police F03 11:11PM

LA Times Homicide Report F03 1:57PM

More Local News...

Other/Breaking News

Doxa du lobby A25 2:03AM

Tech workers organize A24 6:24PM

Architect Stephen Francis Jones A24 3:01PM

UN Forum Wrestles with Economic Policies 10 Years After Financial Crisis Islands Call for A24 12:34PM

Xyloglossie attitudinale A23 8:07AM

Shadowgun Legends Hack and Cheats A23 7:24AM

What does the Quran Say About Islamic Dress?? A21 4:15PM

Biodiversité ou la nature privatisée A20 11:22AM

The Market is a Universal Totalitarian Religion A20 7:14AM

Book Available about Hispanics and US Civil War by National Park Service A19 5:52PM

The Shortwave Report 04/20/18 Listen Globally! A19 4:01PM

The Republican 'Prolife' Party Is the Party of War, Execution, and Bear Cub Murder A19 11:48AM

Neurogenèse involutive A18 9:21AM

Paraphysique de la dictature étatique A16 10:13AM

Book Review: "The New Bonapartists" A16 3:45AM

The West Must Take the First Steps to Russia A14 12:25PM

Théorie générale de la révolution ou hommage à feu Mikhaïl Bakounine A14 3:30AM

The Shortwave Report 04/13/18 Listen Globally! A12 3:50PM

“Lost in a Dream” Singing Competition Winner to Be Chosen on April 15 for ,000 Prize! A12 3:48PM

The World Dependent on Central Banks A12 4:43AM

Ohio Governor Race: Dennis Kucinich & Richard Cordray Run Against Mike DeWine A11 9:40PM

March 2018 Honduras Coup Again Update A10 10:52PM

Apologie du zadisme insurrectionnel A10 3:33PM

ICE contract with license plate reader company A10 1:14PM

Palimpseste sisyphéen A09 11:23PM

Black Portraiture(S) IV: The Color of Silence...Cuba No...Cambridge Yes A09 5:32AM

Prohibiting Micro-Second Betting on the Exchanges A09 4:18AM

Prosecutors treat Muslims harsher than non-Muslims for the same crimes A08 10:33PM

More Breaking News...
© 2000-2018 Los Angeles Independent Media Center. Unless otherwise stated by the author, all content is free for non-commercial reuse, reprint, and rebroadcast, on the net and elsewhere. Opinions are those of the contributors and are not necessarily endorsed by the Los Angeles Independent Media Center. Running sf-active v0.9.4 Disclaimer | Privacy