Agitation and the web

Could a new wave of online video help transform politics?

The last few weeks have seen a new spate of agitational web videos, accompanying the amazing upturn of politicking in Britain in response to the brutal, ill-considered and philistine cuts proposed by the coalition government which took office last May.

Last May, as I noted at the time, was the first time an election in the UK had encountered Web 2.0, and "the intrusion of blogging, interactive amusement, social networking, twitter and user-generated content, including videos." Surveying the trends in those election videos, I found them "enjoyable but mostly not very honed, either aesthetically or politically." Which meant "that internet culture still has a long way to go, at least in the arena of national politics in the UK, before it moves on from reactive political agitation to a more progressive mode of active intervention."

It is now, I think, beginning to move on.

There are good selections of current web video at Coalition of Resistance and Counterfire. There are several strands to be observed. The first is video of actions-in-progress, mostly filmed with mobile phones, minimally edited and posted rapidly on the numerous blogs, Facebook pages and Twitter tags which have sprung up as part of the campaigning. For this is a form of politicking which thrives on social networking, as several journalists have realised.

The BBC education correspondent explained how "the protests that took place last week weren't organised by any conventional political organisation, but they managed to mobilise youngsters in towns and cities from Bournemouth to Edinburgh." Said the BBC man, they were "run through social networking websites, with little centralised control," adding the curious comment that "This DIY radicalism has its own news channels, on Facebook pages and Twitter accounts and blogs, leaving the traditional news organisations and political commentators looking in from the outside." Curious, because it's a rare admission of what is actually always the case with professional media journalism -- always on the outside looking in, usually through tinted spectacles (the kind with blinkers on them).

In short, as I wrote a few days ago, the dynamic of mass protest has been shifted by mobile media and social networking, which now constitute a new extended dimension of politicking. It is not only extra-parliamentary, but also outside of existing associations within civil society, like the National Union of Students -- except that they opening up new networks within civil society, or rather, at its fringes. Probably the best description I've come across of what is happening from inside the movement can be found in a poetically-titled post at Edinburgh University Anti-Cuts Coalition, On our chaotic swarm:

The occupations have formed a swarm network. This network is very hard to destroy. For every occupation that is forcibly evicted, five more have sprung up. We do not rely on leaders or student unions. And in doing so we lack weak links. We can afford to lose connections and nodes in this network, for new ones are continuously forming in their place.

As a networked, chaotic group we can act powerfully and unpredictably. We can appear larger than we are. More powerful than we are. From our nodes we can mobilise, organise. Entirely chaotically. We are inspirational. These are not my words. Our movement have been receiving global solidarity, and global coverage. Internationally similar protests are spawning. And they are looking to us for that inspiration. They are looking to us for methodology.

A tad utopian, but I'm an old 68-er, so I'm not complaining!

The presence of video in this chaotic swarming is well represented by the UCL Occupation, which has set up its own channels on Vimeo and YouTube. Examples here include video solidarity messages, addressed to other occupations or delivered by visitors to the UCL occupation. This extends to spots by celebrity guests at the occupations like comedians Mark Thomas and Richard Herring, and the singer Billy Bragg. Longer items include talks by supportive academics and writers, like Michael Sayeau on the power of advertising, or the economist Graham Turner on "The Economic Crisis - Where are we headed?" -- in other words, examples of what was called in the 60s the teach-in.

Occasionally, the scene is shot with a cinematic eye, like this brilliant single-take of the UCL occupation which at the aesthetic level could hardly be bettered.

 

One of the purposes served by these video-posts is to impugn in several respects the coverage of the television news channels (whose choicest bits are of course rapidly posted and tweeted and retweeted, especially when they involve some politician being embarrassed by an interviewer's question). For one, they counter the promotion to front-page infamy by the mainstream media of rare moments of protestor violence, by projecting a different image of the demonstrations, especially non-violent street actions. Flash mobs protesting tax-evasion by Vodaphone and TopShop clearly articulates popular anger. They not only focus "disaffection with the failure of conventional politics to respond to widespread concerns about tax justice", but annouce in symbolic form that there is a different way of funding the deficit.

Second, videos which provide evidence of the misbehaviour of the police, correcting the spin the police try to put on events. Examples here and here. The general rule, of course, that governs the creation of video for the web is to keep it short, but this is not an unsophisticated audience. There's a post of 11 seconds showing a policeman punching a demonstrator; an extended version was posted up in response to a viewer's request to see the context.

Third are videos from inside the occupations, which communicate the enthusiastic atmosphere, cooperative behaviour and positive attitudes which prevail among these protestors. Most of these are made by aficionados -- who doubtless include students on the creative practice courses which, because they belong to "arts and humanities", will have their public funding cut off. But they also include professional work by independent film makers like the Guardian team, such as their video of the UCL Occupation. This is a piece of professional reportage, sans the unctuous voice of a reporter, which corrects the bias of the meagre television reportage of the events. There are several similar videos here.

In short, agit web video serves to re-write the "narrative" (as in the PR man's lament that "we got the narrative wrong"). But it isn't just a trendy accompaniment to a chaotic movement. It not only punctures the dominant version of the mainstream media, but enters into its own circuit of positive feedback, both as counter-propaganda and instrument of mass action.

Overall, what strikes me is that one can see a range of videos here that are strongly reminiscent of the variety of sub-genres in recent activist video movements in Latin America, like indigenous video (video indigena) in Brazil and Bolivia etc., and the movement in Argentina which exploded into action nine years ago, known as cine piquetero. Not necessarily the same subgenres, but appropriate ones for the context. Is there something about the short form of agitational video which predisposes this kind of arrangement?

There is also a currently lesser trend made up of campaigning videos produced to support the new movement. They are mostly semi-professional, or the political work of multimediamedia professionals, lending their talents to the cause. They turn up within this circuit because they provide points of attachment to the wider oppositional culture to which the student movement as such necessarily belongs. Some of them are video lectures by eminent Marxists. Other examples include:

"An important message about the arts" -- a simple aninmated video by artist David Shrigley, which is amusing, but perhaps ideologically a little confused in giving too much emphasis to economic arguments to Save The Arts.

Poet Danny Chivers contributes Shop a Scrounger

and perhaps my favourite, a brilliant music video from Captain SKA:

 

Michael Chanan is a documentarist and film critic. He blogs at Putney Debater, and you can view his video of the Turner Prize teach-in here.

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We're racing towards another private debt crisis - so why did no one see it coming?

The Office for Budget Responsibility failed to foresee the rise in household debt. 

This is a call for a public inquiry on the current situation regarding private debt.

For almost a decade now, since 2007, we have been living a lie. And that lie is preparing to wreak havoc on our economy. If we do not create some kind of impartial forum to discuss what is actually happening, the results might well prove disastrous. 

The lie I am referring to is the idea that the financial crisis of 2008, and subsequent “Great Recession,” were caused by profligate government spending and subsequent public debt. The exact opposite is in fact the case. The crash happened because of dangerously high levels of private debt (a mortgage crisis specifically). And - this is the part we are not supposed to talk about—there is an inverse relation between public and private debt levels.

If the public sector reduces its debt, overall private sector debt goes up. That's what happened in the years leading up to 2008. Now austerity is making it happening again. And if we don't do something about it, the results will, inevitably, be another catastrophe.

The winners and losers of debt

These graphs show the relationship between public and private debt. They are both forecasts from the Office for Budget Responsibility, produced in 2015 and 2017. 

This is what the OBR was projecting what would happen around now back in 2015:

This year the OBR completely changed its forecast. This is how it now projects things are likely to turn out:

First, notice how both diagrams are symmetrical. What happens on top (that part of the economy that is in surplus) precisely mirrors what happens in the bottom (that part of the economy that is in deficit). This is called an “accounting identity.”

As in any ledger sheet, credits and debits have to match. The easiest way to understand this is to imagine there are just two actors, government, and the private sector. If the government borrows £100, and spends it, then the government has a debt of £100. But by spending, it has injected £100 more pounds into the private economy. In other words, -£100 for the government, +£100 for everyone else in the diagram. 

Similarly, if the government taxes someone for £100 , then the government is £100 richer but there’s £100 subtracted from the private economy (+£100 for government, -£100 for everybody else on the diagram).

So what implications does this kind of bookkeeping have for the overall economy? It means that if the government goes into surplus, then everyone else has to go into debt.

We tend to think of money as if it is a bunch of poker chips already lying around, but that’s not how it really works. Money has to be created. And money is created when banks make loans. Either the government borrows money and injects it into the economy, or private citizens borrow money from banks. Those banks don’t take the money from people’s savings or anywhere else, they just make it up. Anyone can write an IOU. But only banks are allowed to issue IOUs that the government will accept in payment for taxes. (In other words, there actually is a magic money tree. But only banks are allowed to use it.)

There are other factors. The UK has a huge trade deficit (blue), and that means the government (yellow) also has to run a deficit (print money, or more accurately, get banks to do it) to inject into the economy to pay for all those Chinese trainers, American iPads, and German cars. The total amount of money can also fluctuate. But the real point here is, the less the government is in debt, the more everyone else must be. Austerity measures will necessarily lead to rising levels of private debt. And this is exactly what has happened.

Now, if this seems to have very little to do with the way politicians talk about such matters, there's a simple reason: most politicians don’t actually know any of this. A recent survey showed 90 per cent of MPs don't even understand where money comes from (they think it's issued by the Royal Mint). In reality, debt is money. If no one owed anyone anything at all there would be no money and the economy would grind to a halt.

But of course debt has to be owed to someone. These charts show who owes what to whom.

The crisis in private debt

Bearing all this in mind, let's look at those diagrams again - keeping our eye particularly on the dark blue that represents household debt. In the first, 2015 version, the OBR duly noted that there was a substantial build-up of household debt in the years leading up to the crash of 2008. This is significant because it was the first time in British history that total household debts were higher than total household savings, and therefore the household sector itself was in deficit territory. (Corporations, at the same time, were raking in enormous profits.) But it also predicted this wouldn't happen again.

True, the OBR observed, austerity and the reduction of government deficits meant private debt levels would have to go up. However, the OBR economists insisted this wouldn't be a problem because the burden would fall not on households but on corporations. Business-friendly Tory policies would, they insisted, inspire a boom in corporate expansion, which would mean frenzied corporate borrowing (that huge red bulge below the line in the first diagram, which was supposed to eventually replace government deficits entirely). Ordinary households would have little or nothing to worry about.

This was total fantasy. No such frenzied boom took place.

In the second diagram, two years later, the OBR is forced to acknowledge this. Corporations are just raking in the profits and sitting on them. The household sector, on the other hand, is a rolling catastrophe. Austerity has meant falling wages, less government spending on social services (or anything else), and higher de facto taxes. This puts the squeeze on household budgets and people are forced to borrow. As a result, not only are households in overall deficit for the second time in British history, the situation is actually worse than it was in the years leading up to 2008.

And remember: it was a mortgage crisis that set off the 2008 crash, which almost destroyed the world economy and plunged millions into penury. Not a crisis in public debt. A crisis in private debt.

An inquiry

In 2015, around the time the original OBR predictions came out, I wrote an essay in the Guardian predicting that austerity and budget-balancing would create a disastrous crisis in private debt. Now it's so clearly, unmistakably, happening that even the OBR cannot deny it.

I believe the time has come for there be a public investigation - a formal public inquiry, in fact - into how this could be allowed to happen. After the 2008 crash, at least the economists in Treasury and the Bank of England could plausibly claim they hadn't completely understood the relation between private debt and financial instability. Now they simply have no excuse.

What on earth is an institution called the “Office for Budget Responsibility” credulously imagining corporate borrowing binges in order to suggest the government will balance the budget to no ill effects? How responsible is that? Even the second chart is extremely odd. Up to 2017, the top and bottom of the diagram are exact mirrors of one another, as they ought to be. However, in the projected future after 2017, the section below the line is much smaller than the section above, apparently seriously understating the amount both of future government, and future private, debt. In other words, the numbers don't add up.

The OBR told the New Statesman ​that it was not aware of any errors in its 2015 forecast for corporate sector net lending, and that the forecast was based on the available data. It said the forecast for business investment has been revised down because of the uncertainty created by Brexit. 

Still, if the “Office of Budget Responsibility” was true to its name, it should be sounding off the alarm bells right about now. So far all we've got is one mention of private debt and a mild warning about the rise of personal debt from the Bank of England, which did not however connect the problem to austerity, and one fairly strong statement from a maverick columnist in the Daily Mail. Otherwise, silence. 

The only plausible explanation is that institutions like the Treasury, OBR, and to a degree as well the Bank of England can't, by definition, warn against the dangers of austerity, however alarming the situation, because they have been set up the way they have in order to justify austerity. It's important to emphasise that most professional economists have never supported Conservative policies in this regard. The policy was adopted because it was convenient to politicians; institutions were set up in order to support it; economists were hired in order to come up with arguments for austerity, rather than to judge whether it would be a good idea. At present, this situation has led us to the brink of disaster.

The last time there was a financial crash, the Queen famously asked: why was no one able to foresee this? We now have the tools. Perhaps the most important task for a public inquiry will be to finally ask: what is the real purpose of the institutions that are supposed to foresee such matters, to what degree have they been politicised, and what would it take to turn them back into institutions that can at least inform us if we're staring into the lights of an oncoming train?