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Thinking 2020

Written by Pablo González and Pedro Nonay trying to understand Covid 19’s consequences.

Entry 6 – covid 19

24 April 2020

There is much (somewhat futile) debate about whether Covid 19 was premeditated or not. Was it the bats as food; was it an involuntary escape from the Wuhan lab; was the escape itself voluntary; if voluntary, was it done by the Chinese; was it forced by the Americans to make it look like it was the Chinese? There are even those who think it was done by aliens, the Illuminati, divine design, or a super-evil from the James Bond movies. 

Actually, knowing the true origin doesn’t matter that much. Of course it would be nice, but the consequences don’t change much. It’s like Pearl Harbor (books are still being written about whether it was a false flag attack to force the US into WW II). Or, like the Maine in Cuba (it’s almost clear now about the false flag, because enough time has passed). The consequences of the above two examples were far greater than their original design (if they existed). And that is what is going to happen here.

More important than who is at fault is analyzing how each party involved is using it. 

The actions that each party has decided to implement, mixed with the strengths of each one, and mixed with the previous trends, which I have already talked about, is what will give us the probable final result. And, unfortunately, that is independent of whether the final result is the best possible, or not.

Qui prodest?

It is the classic Latin phrase, widely used in the judicial world, to ask who benefits?

In this case, the meaning should be broadened. It is not a question of who benefits from the situation (finding the perpetrator), but how each one is handling it for his own benefit.

It would be nice if, in the face of something as big as what we are facing, there were a kind of camaraderie between the parties to make a common front. It would be nice if the countries, or the political parties within each country, or the large corporations, … would coordinate. But, there is so much at stake that, unfortunately, the greed of each party to use the situation to their advantage is more powerful. Actually, although I said “use”, it would be better to say “try to use”, and even better to say “lose because of greed”.

I find it interesting to make a small review of the way in which each “player” uses the situation. I’ll do it below, but I can’t resist making an aside: one of my friends is very opposed to using the words “game”, “player”, and all related words. He says that serious things are not to be played with. I tell him here that it should be so, but that, seeing how important people act, they are either “playing”, or they are profound imbeciles (I’m talking about almost all of them).

I clarify that what I summarize below is just that: a summary. A detailed description of the situation in each case would be unapproachable. With the summary I am looking for the relevant “snapshot” of the attitude, which is what counts for the response of the masses.

China

China has been the epicenter of Covid 19. That hurts his image as “guilty” and deserving of punishment. 

But, China has also been (or seeks to appear to be) the first place to control the pandemic. And it has done so with relatively little damage (although we know that the data are not reliable). That benefits its image as “effective”.

China’s way of acting has been the way their regime allows them to act: strong authority, with severe measures. The success of their actions weakens the concept of “individual freedoms”. Giving them up, to improve protection, may be interesting in the view of many.

China is seeking to use its image of efficiency and solidarity (with aid to other countries) to strengthen its international position.

It seems that they do not (yet) seek the position of world leader, but they do want to weaken the US position and strengthen their own.

They are also preparing for what they know will happen in terms of disinvestments by other countries in China in order to “recover their domestic production”. They do so knowing that these divestments cannot be immediate, and trying to strengthen, in the meantime, their domestic consumption, and their alliances with other countries (silk road with Europe, or control of Africa, e.g.).

It may work for them. Everything will depend on whether the US manages to charge them large costs based on their theoretical guilt (which I do not see how they can do it). They also have the tool of using their position as a large holder of foreign public debt, which is, at the same time, a risk in the event of default.

China is certainly not oriented toward full global collaboration. It is clear in their way of not sharing full information from Covid 19.

USA – Trump (there are other USA)

Trump is more focused on his re-election than the good of the USA. 

He seeks to promote the idea that China is to blame. 

He, at the meantime,  is promoting internal nationalism. He is seeking to close borders (Covid 19 has helped it). He is also withdrawing resources (and trust) in global bodies. He does so with different arguments, but the facts are that its partial withdrawal from WHO, and even NATO, are along the lines of abandoning its position as a global leader and focusing “at home”. This pleases China, which is not seeking to replace him in global leadership, but to weaken his position in the world.

To the rest of the world he says something like: “I am going to go this way.  Whoever wants to join me, can do so, but I will consider it high treason if he has relations with China”. In other words, he seems to want to change world leadership to recognize a world of blocs, and to be the leader of one of them.

He may succeed in creating such blocs, and be leader of one. But his decline in global political power is clear. Although it comes from very high up, and the decline will be gradual and slow.

He is certainly not seeking global cooperation in the face of global threats.

Old Wall Street

By “Wall Street” I mean high economic power. And, by old I mean what it sounds like: those who controlled (watch out for the past tense conjugation) Wall Street in the 20th century (banks, central banks, oil, … ).

They have a lot of strength, but they are in irreversible decline. Not far from bankruptcy.

They can’t quite accept that Amazon could almost effortlessly buy JP Morgan. Nor that it has much more information than they do in its databases.

They are trying to defend the “crony capitalism” racket.

Their almost unique weapon is “too big to fail”. In their chumming with the FED, and their pressures on governments, they are saying: “either you help me, or I will make a big mess with my bankruptcy”.

Their objective is to repeat what they did in 2008: “give me money from public aid, you can collect it later from those who pay taxes”. In addition, they add the variant: “you don’t need to take money from your citizens, you just need to use the banknote machine (in sophisticated variants)”, but that is just a dirty trick, the truth is that, in the end, the banknote machine will generate inflation, and the inflation will be a robbery to the citizens.

In this case they have an almost perfect excuse: “it wasn’t my inefficiency, it was the damn virus”. In reality, their balance sheets were already a disaster before the virus, but the occasion is perfect for them. In fact, more than one says that so much confinement was not necessary for health reasons, that they have been the ones who have pressured governments to find their excuse.

They have not realized the shift in power generated by the technological revolution. They are clear losers in the future. But, as their power is very great, their fall will be very slow. I am reminded here of a joke of a farmer relative in Cuenca, who said: “agriculture is the slowest way I know of going bankrupt, but it is very sure”.

This group has always had a fairly global control approach (within its sectoral scope, but global in territorial terms).

Modern Wall Street

Here I am referring to the big technology companies. Not strictly to the American Nasdaq companies, but to all the tech companies in the world.

They are not a structured and homogeneous power group (like the old Wall Street), but they have their common denominators and communication channels. An example of this is the recent agreement between Apple and Google before Covid 19, with which they are making a “soft coup d’état”, or a demonstration of power.

The truth is that Covid 19 has divided them into two very different groups: those who have benefited and those who have been harmed.

Covid 19, not only for its direct influence on the pandemic time, but also for the long-term trends that it will generate, has damaged many technological companies. This is the case of Uber (today people do not transport themselves and tomorrow they will be afraid, they’d better do it in their private car), or WeWork (the office world will be very different when teleworking multiplies a lot), or many others.

However, there are others that have benefited greatly. Amazon is the clearest example. And it is not only cyclical. Once it has convinced customers who previously still shopped on the high street, many will stay there (at least to a significant extent). Netflix is another case in point.

The corporations benefited by Covid 19 of the technology group are building an immense global factual power (they are global). They are reaching greater heights of power than the energy corporations did in the industrial revolution. 

A simple example is the history of the great historical economic powers. It is always difficult to compare things from very different eras, but it is written that the greatest personal fortune in history was that of Crassus (in ancient Rome). Rockefeller almost reached his height with his control of oil, but didn’t quite make it. Jeff Bezos is not there yet, but his empire is still growing, and he can make it. Side note is that Rockefeller’s death was much more pleasant than Crassus’. For anyone who doesn’t remember and doesn’t want to delve into Google, I say that Crassus lost a battle trying to conquer Asia (Asia has never been easy for Europeans), and they assassinated him by forcing him to drink liquid gold as a sign of the problems of greed.

There seems to be a clear power shift in the control of the instruments of global production. But these corporations will have to deal with the political forces of each place. Yes, they have an easier time reaching the subconscious of the masses, because they control the information, but the politicians have the censorship, and the police (the monopoly of violence).

Decentralized power

Closely connected to technology, but quite contrary to the concept of “modern Wall Street”, I have to mention a trend that I see as relevant. 

It is what they call “decentralized organizations”. For many it will be an unknown concept. As an explanation, which will scare more than one, I say that it is the basis of cryptocurrencies (Bitcoin as the first evangelist).

The central idea on which these theories are based is that in the past there were not sufficiently agile communication tools for making any organizational governance decision. But now (always after the Internet), there are.

It’s actually a bit like Swiss democracy, where they continuously vote on small decisions (changing the direction of a street, and things like that).

Today technology allows very agile communication between all those affected by anything. And the elimination of all types of intermediaries for anything, without needing to delegate powers.

The “believers” in this (I use the word believers because, for now, it is more like a religion than anything really applied and proven), think that there is no need for any kind of regional or sectoral organization. They believe that people can make and implement their decisions without structures.

Its approaches are inspired by ancient anarchy, but using modern tools.

There are many more than it seems who believe in this.

And it is not so impossible. Algorithms, blockchain, democracy taken to the detail, and other tools, allow to choose the most accepted decision (which does not mean it is the best one, so the same problem of ancient democracy underlies).

What these “believers” do not realize is that the end result of their theories, taken to the maximum application, implies the opposite of true individual freedom. Rather, they take the dictatorship of the majority to the maximum. 

The underlying idea is: “do we set up an administration to organize whatever, or do we let society organize itself in its own way? “.

The example of Bitcoin is paradigmatic. With its design, no central bank has the power to do QE (is that good or bad?).

It is true that, with the communications that technology allows today, we can agree on even the smallest details of each activity. Of course, if we reach that point, won’t we be just another cell of a large organism, accepting the decisions of the common good, instead of being individual beings? This gives a lot to think about, but it is not a “post Covid 19” thing, it is something for later, but very important.

Of course, this trend is global, but there is still a long way to go before it becomes widely accepted.

Europe (Brussels)

Europe has been trying to build “community feeling” for decades. They have achieved something. The results of the Erasmus program among young people are a good example.

But the weight of the history of differences is very strong. An example of them is the distrust between countries that we are seeing every day, which prevents them from reaching agreements to choose the form of financial bailouts.

In the meantime, Europe has less and less weight in the world economy, and that is if it is united.

It looks like the sad decadence of an old rich family in which nobody has worked for a long time and nobody remembers how hard life as a poor person is.

The most Europe can do for future world is to try to seek a position of some respect as a second or third guest at someone else’s party. And that is if it maintains its unity. If it does not, the power of each part of Europe will be completely irrelevant to the world.

However, for a long time it can remain a theme park for the rich from elsewhere. Nothing very different from what Italy has been for the last 500 years (its global power was nil, but everyone who thought he was somebody had to visit it).

I said before that the result of this geopolitical war is that Europe will be the spoils of the winner. And I remember here that this is what happened in WWII: Europe was divided between the USA and the USSR.

I don’t see that Europe’s decisions will make any difference to the play of world forces in the current situation. I only see that it is up to it to decide who its future protector is. Or, to put it in a very cruel way, it is like the pretty whores that everyone looks at: it is up to you to choose “pimp”.

Populist revolutionary politicians

Although the sensible reaction to all this would be to seek a global government for global problems, given that local power is based on the support of the local masses (with, or without democracy, because without the support of the masses the dictator is assassinated, and the democratic president loses the elections), the fact is that we are facing a fertile ground for populist politicians.

The masses do not understand what is happening but they do know that their world is changing, and they do not want that to happen. The masses also have no judgment, they only look for enlightened leaders to follow.

Everywhere there are emerging such leaders who tell the masses that they will defend them (a lie), and that they will return to the world they like (also a lie).

This is a very big “anti-globalization” force, which becomes even bigger after the suffering of the masses, which is going to increase when the post Covid 19 economic crisis becomes clearer (the masses do not see it yet).

As the success of populist leaders (their desired local power and personal quality of life) depends, not only on the support of the masses, but also on that of someone relevant in the global balance, these leaders will act as I was saying about whores (they will look for their “pimp”). 

There will be many local governments based on populism, supported by someone powerful who finds it easier to “buy” the allegiance of that leader than to invade and control the country.

And this is equally applicable to politicians who speak of ideology (communism vs. capitalism, since they use old and ineffective languages today, but valid for their clientele), as to those who speak of nationalism (whether it is nationalism of countries or regions).

An immense pity.

Small conclusion

The result of all the above is that I do not see that any of the parties has a clear hegemonic force over the rest to impose “their truth”. Nor do I see that none of them is strongly pushing for coordination among all of them.

Unfortunately, I also see no chance of achieving the truly useful issue: global governance focused on solving global problems effectively.

Mixing all of the above with the previous trends discussed in entry 2, it seems to me that we are headed towards creating, once again, a world of balance of power between blocs (as happened during the cold war).

These blocks will function temporarily (decades, or perhaps longer), until the masses see the necessary truth of global coordination.

But these blocs will not be based on local power as in the cold war. There will be a necessary hidden coordination with other powers (these global ones) that will control sectorial issues (economy, technology, religion, …) very necessary for their manipulation of the masses. Basically, nothing new compared to the past.

By the way, I have not spoken of these sectorial global powers (a paradigmatic case is that of religions), because nothing will change in that, at most, they will even increase their strength, contrary to what people expect.

My predictions

As I began to write these entries, I was afraid to do so. I didn’t know if I would be able to, or if they would interest anyone. 

I said at the beginning that my goal was to sort out my ideas (to try to understand what is going on), and to share them with friends who would help me to think, and even to change my ideas.

I say now that I have achieved that.  The conversations and messages with friends after each note have helped me a lot. Thank you.

I have no idea whether my conclusions after the study are good. But I do know that they are worthwhile for me, as a somewhat thought-out point of support, to make my personal decisions for the future.

I also say that I have lost my initial fear of writing. I even got a taste for it. But, it is necessary to avoid excess in order not to bore. Therefore, I think the time has come to finish.

I have been thinking about how to finish these entries. Logically, I have many doubts. The truth is that I cannot offer any scientific and safe conclusion with guarantees (I do not have them, and I have not made such a scientific study either, although I can tell you that I have thought much more than what I have written). It is also true that I have drawn some conclusions that convince me, even if they are not very solidly based. As all of you with whom I have shared these notes are somewhat the authors of them (your contributions have been very useful), it does not seem honest to me not to put my conclusions. But, as I myself have little confidence in them, I will post them, but I ask you not to give them more importance than your judgment tells you.

So the next thing is to write my conclusions, but that will be in the next entry. They will be brush strokes of what is going to happen in my opinion. Then I will try to share what I think we should do about it.

To be continued, …