When Bad Habits are Set in Stone, Is a Reset Possible?

A heavily indebted world needs not so much a new world order as a real world order.

May 25, 2022 16:51 EDT

For any citizen of the world today, there is no lack of reasons for worry on a global scale. For a start, the climate crisis is impossible to ignore. Though some, for political or economic reasons, publicly deny its reality, any rational human with access to any form of media will be aware of two simple facts. The first is the accumulating evidence of worryingly abnormal weather events. The second is the lack of any willingness on the part of our political institutions to address the problem in a way even vaguely commensurate with its gravity.

Then there’s COVID-19 that has now been with us for two and a half years and counting. And just as we were beginning to adjust to the idea of reduced military tension in the Middle East and Central/South Asia after the Biden administration’s withdrawal from Afghanistan, the world has been offered the spectacle of a prolonged drama in Eastern Europe, the response to which in the West has seemingly been designed to upset the global economy on an unheard of scale.

The economy still hasn’t recovered from the lingering aftereffects of the financial shock of 2007-09. The medication prescribed at the time, bearing the label Quantitative Easing (QE), turned out to be an addictive drug. It had the great merit of ensuring a growing asset bubble that shared the same “forever” characteristic we ended up associating with Middle Eastern wars. It turned out to be quantitatively easy for the rich who simply got richer while the masses hoped that the promised trickle-down effect would be sufficient to meet their daily requirement of OxyContin or whatever other drug they took to ease the pain.

The latest disaster to add to the heap, Russia’s invasion of Ukraine, has nevertheless proved a great boon for two sectors: the West’s armaments industries and its media. The job of the latter has become essentially finding multiple ways of praising a defense-obsessed economic and political system. The militarization of the economy — already vehemently denounced by President Dwight Eisenhower in 1961 — has finished by usurping what’s left of the theoretical moral authority of the people in a democracy. The same militarized economy has spawned the information technology currently employed by a few billionaire geniuses to suck everything that moves into the vortex of their global platforms. The addiction is total. With a looming metaverse around which everything will be organized, it is likely to become absolute.

But even in a world where the diverse drugs supplied by Raytheon, Purdue Pharma, Fox News and The New York Times (and even the US Treasury with its QE) help to keep a majority of the population in a state of basic survival, animated by their growing need for another daily dose, many of the nations of the world are teetering on the brink of collapse due to the uncontrollable growth of sovereign debt.

Highlighting the global debt problem, Ellen Brown, a lawyer and economist, founder of the Public Banking Institute, explained that beyond a certain point of growing instability a reckoning becomes inevitable. It can take the form of a general crash. But we appear to have learned at least one lesson from the 1929 stock market crash. The response 80 years later, in 2009, was a bailout aiming to save the institutions that were too big to fail. But that only put off the reckoning. “Today,” Brown writes, “the remedy for an unsustainable debt buildup is called a ‘reset.’”

Today’s Weekly Devil’s Dictionary definition:


The idea of re-establishing a set of rules that are no longer respected, typically in a context in which hardly anyone has the foggiest idea of what the original rules were and even fewer of what a new set of rules that could be generally accepted might look like.

Contextual note

The idea of a reset rather than some kind of temporary drug or placebo such as a bailout or QE has recently been in the news thanks to the insistence of the World Economic Forum’s (WEF) not just on a reset, but on a “Great Reset.” Klaus Schwab, the founder of the Davos extravaganza, championed the idea in 2020 as a response to the early impact of the COVID-19 pandemic on the global economy. It was the capitalist class announcing its own revolution.

When the kind of people who participate in the WEF promote a solution to humanity’s problems, they don’t just propose a cure, they propose a “great” cure. A “great” solution of course means a top-down solution, decided by those who claim to exercise a monopoly on practical (i.e. financially workable) knowledge.

Ellen Brown has no illusions. “The ‘Great Reset’ being driven forward by the World Economic Forum,” she writes, “would lock the world into a form of technocratic feudalism.” Digging into ancient history, Brown cites a model of reset that appears to make a lot more sense.

Historical note

Instead of imagining a sophisticated top-down redesign of an admittedly unstable system that might subsequently be put under the “rational” control of intelligent technologies managed by enlightened industrial leaders, the tradition she cites is that of the ancient Mesopotamian Jubilee. It was a moment in the historical cycle in which a royal decree declared the cancellation of debts to permit society to begin functioning anew. Lucidly analyzed by both the economist Michael Hudson in his book, …and forgive them their debts and the late anthropologist David Graeber in his book, Debt, the First 5,000 Years, jubilees aimed at liberating the energies of a population increasingly shackled by unpayable debt. These were occasions on which society was invited to put the value of human relationship ahead of the value of money.

The industrial age and the “economic science” that underpinned the capitalist revolution did the contrary. It definitively turned money into an absolute, a universal measure of everything. Debt defined an unbreakable dependence that no human being, under the law — not even a king or a president — was empowered to abrogate. Since the 2008 financial collapse, whenever a crisis threatens to cripple the economy, the solution has become to create new levels of debt borne by the entire population. Such debt is engineered to enrich the debtors — those who are never allowed to fail — and squeeze the anonymous creditors, who must support the burden over time. Individuals have no personal title to a collective debt, but they effectively become creditors who are allowed to fail or simply be crushed by their inability to earn. The debtors — the holders of assets, consistently bailed out thanks to devices such as quantitative easing — will be encouraged and supported by the system.

In 2009, a different reset briefly made the news, almost as a comic interlude. With the benefit of hindsight, this trivial incident could be seen as a telling moment in an unfolding tragedy that has now exploded in our faces. I’m referring to the cordial encounter between Barack Obama’s newly appointed Secretary of State, Hillary Clinton, and Russia’s Foreign Minister, Sergei Lavrov.

The State Department of the newly elected President Obama felt the need to recalibrate the relationship between the two former rivals of the Cold War. The presidencies of Hillary’s husband, Bill and then George Bush, in contrasting ways, had done little more than aggravate the inevitable chaos that followed the collapse of the Soviet Union. It was time, Hillary may have been thinking, to program a “reset.”

In 2008, at the NATO conference in April, Bush had insisted on inviting Ukraine and Georgia to join NATO, generally understood to be a red line that Russian President Vladimir Putin would not allow to be crossed. Four months later, with the red line threatened, Russia successfully invaded Georgia. Three months after that, Obama was elected president on a program of hope and change.

Secretary Clinton chose to publicly dramatize the coming change in the US-Russia relationship. To demonstrate her good humor and Yankee playfulness, she did what Americans are so often tempted to do: find a way of reducing complexity to a trivial gesture. In this case, she unveiled a toy for the two chief diplomats to play with. She called it a “reset button.” The object, with its big red button at the center, bore a Russian word the State Department translators mistakenly believed to mean “reset.”

After presenting the toy, Clinton then asked Lavrov the question one should never ask. “We worked hard to get the right Russian word,” she boasted. “Do you think we got it?” Lavrov calmly pointed out that the Russian word they had chosen meant “overcharge.” Trying to save face, Clinton responded to the idea of overcharge: “We won’t let you do that to us.” She took overcharge to mean “invoice an excessive amount” rather than the more obvious meaning, given the context: charge a battery beyond its capacity.

After all, in a nation that believes “time is money,” one may also be inclined to believe diplomacy is also money, which after all is the measure of all value. Her immediate reflex was to blurt out that being in debt to Russia was unthinkable. Finally, for those who may not be following the evolution of relations between the two countries, the reset Clinton promised never appears to have achieved its goal.

*[In the age of Oscar Wilde and Mark Twain, another American wit, the journalist Ambrose Bierce, produced a series of satirical definitions of commonly used terms, throwing light on their hidden meanings in real discourse. Bierce eventually collected and published them as a book, The Devil’s Dictionary, in 1911. We have shamelessly appropriated his title in the interest of continuing his wholesome pedagogical effort to enlighten generations of readers of the news. Read more of Fair Observer Devil’s Dictionary.]

The views expressed in this article are the author’s own and do not necessarily reflect Fair Observer’s editorial policy.


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