Who is Jeffrey Sachs and why is he saying these things?

Last month the economist Jeffrey Sachs said something which should have sent shockwaves around the world. “I chaired a commission for The Lancet for two years on Covid,” Sachs told a conference in Madrid. “I’m pretty convinced it came out of US lab biotechnology, not out of nature; just to mention after two years of intensive work on this. So it’s a blunder, in my view, of biotech, not an accident or a natural spillover."

 This is not the kind of claim that can be safely dismissed – as claims going against the orthodoxy invariably are – as a ‘conspiracy theory’. Sachs is a famous economist. Twice one of Time Magazine’s most influential people in the world, he was responsible, as an advisor to Boris Yeltsin, for imposing shock therapy on post-Communist Russia (coincidentally the 1990s saw life expectancy in Russia fall by the largest amount, outside of war or famine, in any nation in history). Since then he’s undergone something of a metamorphosis, endorsing Bernie Sanders in the 2020 American election.

The Lancet is a famous British-based peer-reviewed medical magazine, not noted for its articles on the Loch Ness monster, Big Foot sightings and the lost city of Atlantis.

The Sachs/Lancet combination is therefore not one that can be plausibly accused of spreading fake news in order to garner a few thousand likes on Twitter. But what Sachs had to say wasn’t greeted with the kind of peaked curiosity you might expect from the media. The UK right-wing press – Telegraph and Daily Mail – did register his comments, though noticeably without the level of glee that accompanied claims from the year before that China, alone, might be responsible for Covid. State media (the BBC) and the liberal press (The Guardian) were conspicuous by their silence. Likewise the left-wing, and generally pro-China, Morning Star.

‘This was teamwork’

If Sachs is too close to the Establishment to be branded a conspiracy theorist, claims he is merely a “Xi propagandist” (Xi Jinping is the President of China) don’t really stack up either. After all, what he is saying does not exonerate China. To do that, he’d have to parrot the Chinese government line – and that of many western scientists – that Covid definitely originated in the wild.  Or echo Chinese media claims that the Covid-19 virus was cooked up at a US military base in Maryland. But he’s doing neither. He’s saying it’s very possible – not definite, no-one can know for sure without transparency by all parties – that SARS-COV-2 (Covid) was a deliberate creation of a US-Chinese scientific partnership and leaked out inadvertently as a result of a terrible mistake.  

It’s a matter of public record that US government agencies funded coronavirus research at the Wuhan Institute of Virology among other places. This was a result of a 2014 Federal ban on such research in the US because it was considered dangerous. There were, Sachs says, grant applications that wanted to manipulate coronavirus strains to make them more infectious to humans (the logic being that if you do so, vaccines are supposedly easier to formulate). The National Institutes of Health – the US government agency that doled out the funds – says that no such proposals were approved. But, retorts Sachs, it’s common knowledge in these fields that some research is always undertaken in advance of the securing of funding.

“If this came out of a lab, it was US biotechnology that made it possible,” asserts Sachs. “The US actually trained the people at the Wuhan Institute of Virology, they were engaged with them, they were part of the same grant proposals. This was teamwork.”

Two caveats should be made. One if Covid was released from a lab, it was a catastrophic error, not part of some dastardly plan to create a devastating new bioweapon. Two, there is no certainty. “We don’t know for sure, I should be absolutely clear,” Sachs cautions. “But there’s enough evidence that it should be looked into and it’s not being investigated, not in the United States, not anywhere. I think for real reasons that they don’t want to look underneath the rug too much.”

 

Oops

 

But what is clear is that, Jeffrey Sachs aside, there isn’t much of an appetite for truth here. Some people – US Republicans, Tony Blair etc. – were all for lifting up the rug when they thought China was the sole perpetrator. Certain Trumpists even wanted to go to war over it. But the enthusiasm on the Right for the unvarnished truth has waned the more the plot has thickened.

American Democrats and centrists and liberals of various hues are fervently attached to the zoonotic explanation for Covid because to depart from it puts science in the crosshairs when it belongs firmly on a pedestal.  When the Chinese government isn’t agreeing with them for slightly different reasons, it’s urging the World Health Organisation to investigate the sudden closure of the US military base denounced as the harbinger of Covid.

But Covid as the bastard child of a joint US-China scientific project gone cataclysmically awry? That doesn’t have quite the same partisan appeal, not least because you can’t blame communism or the US military. Ironically, if it is true, the only possible scapegoats for a death toll of, conservatively, over six million and counting, are the signature forces of our age, globalisation and outsourcing.  I mean who’d have thought they could have any downsides?

That’s the one certain ‘takeaway’ in the Sachs version of the lab leak theory. The world is a lot stranger than you thought. A new Cold War, even direct military conflict, is brewing between the USA and China. The most ‘globalist’ candidate to replace Johnson as UK PM, Rishi Sunak, promises to “face down China” as the biggest threat to world security. And yet here were these deadly enemies cooperating on extremely risky germ research. And that’s beyond dispute; they were cooperating even if at this point the Armageddon outcome is a matter of conjecture. I’m fairly sure that in the actual Cold War, even at the height of détente, the US didn’t farm out biomedical research to the Leningrad Medical Institute.

In all probability, even if some version of the lab leak theory is what happened, it will never become the accepted narrative. To concede that would be to invite a moral reckoning so seismic it would fatally damage the legitimacy of the world’s two superpowers and give a new fervour to the forces of ethno-nationalism and religion. I’d like to think the non-national, council democracy of the Kurds could step into the breach but I realise its libidinal reach is at present a lot smaller.

 It will be interesting to see how the final, peer-reviewed report of Sachs’s Covid commission in The Lancet deals with the issue; whether it will be as outspoken as he has been. If it is, I expect it to be one of the most unwelcome items of news in history.

Addendum, 1 Nov 2022

Maybe as expected, the Commission report hedges its bets about the origins of Covid, saying it is “feasible” the virus leaked out as a result of a “research incident” but also that a “zoonotic” explanation – a natural spillover – is equally plausible. In the absence of independent investigation of US laboratories engaged in “manipulation of SARS-CoV-like viruses” or laboratory research in Wuhan, it is not possible to say with any certainty what happened. “Commissioners held diverse views about the relative probabilities of the two explanations, and both possibilities require further scientific investigation,” the report says.

https://uk.news.yahoo.com/lancet-report-claiming-covid-could-132931783.html

https://www.thelancet.com/journals/lancet/article/PIIS0140-6736(22)01585-9/fulltext

 

However, evidence for the synthetic origin of Covid-19 remains: https://twitter.com/mbalter/status/1583203103293071360

The Horror, the Horror .... the Silence. Conservatives and unconditional income

 

The 20^th century Polish economist Michał Kalecki noted an apparently perplexing trait of business leaders and their bought “experts”. One would expect such people to oppose public investment much more vehemently than subsidizing mass consumption because the former contains the possibility of competition from state enterprises. But such expectations are misplaced. “Indeed”, said Kalecki “subsidizing mass consumption is much more violently opposed by these experts than public investment. For here a moral principle of the highest importance is at stake. The fundamentals of capitalist ethics require that ‘you shall earn your bread in sweat’ – unless you happen to have private means”.

Kalecki was writing in the 1940s with an eye on the previous decade. But his observations are particularly apposite to our own era.

Boris Johnson revealed the lingering mind-set of conservatism when he justified ending the £20 uplift to Universal Credit by citing his “strong preference” that people see their wages rise “though their efforts” rather than by welfare.

The same mentality was at work in the pervasive uneasiness around the now defunct furlough scheme which was only introduced under pressure from lame duck Labour leader Jeremy Corbyn and the unions. It can still be seen in the ‘get back to the office’ propaganda that conservatives and business executives – supported by the media – routinely dish out.

The anxiety – verging on horror – that these schemes provoke in conservatives stems from the fact that, in Kalecki’s words, “a moral principle of the highest importance is at stake”. That principle is the maintenance of work discipline. The sanctions regime at the heart of Universal Credit exemplifies the edict of conservatives – big C conservatives and those who go by other nomenclature – that no money be given to ordinary people without stringent conditions.  “Please keep on cracking the whip,” exhorted Good Morning Britain host Richard Madeley earlier this week in true conservative style.

But note Kalecki’s caveat – “unless you happen to have private means”. In which case, all qualms instantly vanish. In fact, regarding the lack of actual work undertaken by the ultra-rich, a veil of silence reigns.

So what do you do?

The existence of huge swathes of people who receive large amounts of money without doing anything to earn it is capitalism’s dirty little secret. “What do capitalists actually do?” asks mathematician David Schweickart in his 2002 book After Capitalism. The answer is very little. They have an entirely passive role. “The capitalist” he says “engages in nothing that can be reasonably regarded as ‘productive activity’. Workers produce and distribute goods and services. Salaried managers coordinate production. Entrepreneurs and other creative personnel develop new products and techniques of production. The capitalist qua capitalist does none of these things.” In sum:

In a capitalist society, enormous sums are paid to people who do not engage in any entrepreneurial activity or take on any significant risk with their capital. Trillions flows to shareholders who make an entirely passive contribution to production.

Some have tried to quantify the enormity of these “enormous sums”. According to economists Thomas Piketty, Emmanuel Saez and Gabriel Zucman, around 30% of all income produced in the United States is paid out as “capital income”. These payments, in the form of interest, rents and share dividends, are “entirely passive”. They comprise “income divorced from work”.

But conservatives are, to borrow a phrase from Peter Mandelson, “intensely relaxed” about this form of unconditional basic income. In fact, they’d rather not talk about it if you don’t mind.

Capitalism, but not as we know it

However, this was the income distribution under capitalism. The past tense is not a typo. Because under the state capitalist system we’ve inhabited since the financial crisis – one vastly ramped up by the Covid pandemic – the passive income of the ultra-rich has been multiplied many times over by the actions of the state.

This process goes by the name of Quantitative Easing (QE) – so-called because it increases the quantity of money in, putatively the economy, but in reality swishing around the financial system.

QE is an extension of practices undertaken by central banks before the financial crisis over a decade ago – known as Open Market Operations – but one that vastly changes their nature. Central banks used to buy assets from commercial banks in order to ensure they had cash in order to settle their day to day transactions with each other, but these purchases were only very short-term. The assets would usually be sold back after a week.

However, under QE the central banks uses the money only it can create to buy assets – government bonds, corporate bonds or mortgage-backed securities usually – outright. Not temporarily. That why, under QE, the balance sheets of central banks have grown exponentially.

As a result of QE the bank or corporation that sells the assets suddenly has an enormous amount of cash to spend. The volume of financing under QE is astronomical, amounting to $834 million an hour by central banks worldwide. By buying the assets, the central bank causes their prices to rise and their yield to fall. The sellers – the banks and corporations – are therefore ‘incentivised’ to put their new money elsewhere, for example into shares or property or acquisitions. Thus, synthetic ‘asset booms’ are generated and the prices of assets rise. In theory, QE is meant to generate a ‘wealth effect’ in the ‘real economy’ by stimulating investment and lowering the borrowing costs for corporations. But there is no evidence this actually happens.

What there is evidence of is an immense, artificially induced, increase in the wealth of the ultra-rich. The combined wealth of US billionaires, for example, has risen by 70 per cent (!!)* since the beginning of the pandemic, a stretch of a little more than 18 months. That is, during a period of severe economic contraction – not to mention prolonged suffering endured by many people – billionaire wealth has leapt from just under $3 trillion to over $5 trillion. In addition, the number of billionaires in the US has risen from 614 in March 2020 to 745. According to Ruchir Sharma of Morgan Stanley Investment Management (and he should know) “the fundamental driver … of the billionaire boom” is “easy money [QE and ultra-low interest rates] pouring out of central banks.” For a sense of perspective here, a billion is a thousand million.

That’s capitalism folks. Except of course it isn’t just capitalism. Pure capitalism, inequality generating machine though it undoubtedly is, does not increase billionaire wealth by 70% in a year and a half all by itself. In essence, the passive wealth accruing nature of capitalism – the ‘normal’ workings of the market – has melded with the passive wealth accruing intervention of central banks – the abnormal workings of the state capitalist regime. But about both unconditional fountains of income for the rich conservatives are, almost universally, mute.

Drop the Pilot

However, the deafness is not limited to conservatives. Leftists also seem unable to grasp the nature of QE. Often the only problem they have with the “easy money” regime is that they think it should be redirected. The authorities, it is said, seem peculiarly oblivious to the unsuccessful nature of QE: that – despite the vast sums involved – it doesn’t actually seem to stimulate the economy.

As an alternative, many advocate cutting out the middleman and instituting so-called “helicopter money”. This involves the metaphorical ‘dropping’ (the term was coined by right-wing economist Milton Friedman in 1969) of large amounts of free money into ordinary citizens’ bank accounts. The theory is that this will actually stimulate the economy as poor (or not rich) people, unlike “high net worth” individuals, are liable to spend the money rather than save it. And it can achieve this at a fraction of the cost of QE.

The problem is that helicopter money flagrantly transgresses Kalecki’s “moral principle of the highest importance”. It doles out unconditional income to the multitude. Therefore, whatever its economic rationality, it won’t be allowed to happen. QE only appears unsuccessful. It wasn’t ever seriously intended to stimulate the economy. QE has served – and continues to serve – its real purpose. It preserves the existence of large corporations and banks and bolsters the wealth of the mega-wealthy.

For conservatives, that is justification enough. As for the rest of us the whip needs to keep being cracked, as it has been for centuries past.

*Elon Musk, CEO of electric vehicle manufacturer Tesla and potential coloniser of Mars, tops the list. He has seen his wealth grow from a mere $24.6 billion in March 2020 to $209.3 billion in October 2021, a rise of 750%. Indeed, he subsequently saw his fortune increase by another $36.2 billion in one day in October. You could argue that this latest alignment of cherries has something to do with the ‘natural workings’ of capitalism. Rental car firm Hertz placed an order for 100,000 Teslas. But even here the fingerprints of the QE regime are all over the deal. Last year Hertz declared bankruptcy but under the strange conditions of QE infinity its share price surged and it issued $1 billion worth of new shares. If the ‘laws’ of capitalism existed anymore, Hertz wouldn’t be around to wave a magic wand over Elon Musk’s wealth.

Obedient Subjects? The disputed and misunderstood legacy of Stanley Milgram

 In 2019, I published a book called The Disobedient Society in which I argued that, contrary to our protestations of our personal freedom, obedience still plays a dominant role in our societies. Referring back to Stanley Milgram’s famous obedience experiments of the early 1960s – which he subsequently interpreted as demonstrating the ease with which we become “agents” for the wishes of authority figures – I highlighted that the very fact that we perceive our following of orders as voluntary, exemplified by the employment contract, serves to camouflage which is really going on.

Six decades on, controversy still swirls around what Milgram did or didn’t discover in New Haven in 1961. So I thought it would be useful to elaborate what I think of these controversies and how Milgram still informs the book’s central idea. In a very astute review of the book one writer, for example, asserts that Milgram’s findings, blighted by revelations of how participants were unduly pressured into going along the experimenter’s instructions, must now be considered mere metaphors for obedience.

Electric Dreams

To recap, the Milgram’s experiment (s) consisted of instructing participants to give electric shocks via a machine to a – usually hidden – stranger, with the proviso that they were told they could leave at any point. However, the shocks weren’t real. The machine went up to 450 volts, enough to conceivably kill the victim, but it was an elaborately designed fake – no-one was being shocked at all. The entire set-up was to ascertain how far participants would go ‘under orders’.

Milgram – through the experiment he oversaw – has been plausibly accused of haranguing some participants to obey and going on ‘shocking’ the victim. If participants hesitated or expressed doubts at any stage they were to be encouraged to continue with phrases like “the experiment requires that you continue” or “you have no other choice, you must go on”. However, these lines were supposed to be used only once – if the participant still refused to play ball, the experiment was halted and they were labelled “disobedient”.

However, recordings of some of the Milgram sessions suggest that the experimenter (not Milgram but an employee, an ‘agent’ of Milgram you might say) went further than he should have, continually pressing participants to continue, “railroading” them according to Gina Perry’s 2012 book Behind the Shock Machine.

Milgram has also been accused of not telling all participants afterwards that the shocks were fake and in one study of arranging for friends, rather than strangers, to play the roles of ‘teacher’ and ‘learner’.

However, it should also be borne in mind, that there wasn’t a single a Milgram experiment but 23 variations and the most frequent obedience rate was 60%.

I Don’t Believe You

The idea that Milgram’s results were invalid really rests on another conception – that many participants saw through the ruse, that they didn’t truly believe anyone was being shocked. Milgram always asserted that the vast majority of subjects were fully taken in by the elaborate deception but according to interviews conducted by the ‘learner’ (the actor playing the victim), immediately after the experiments, many obedient participants claimed that they didn’t believe anyone was being harmed.

So high obedience rates are not what they seem on the surface. What they really reveal, in this view, is a desire to go along with what the experiment demands. Obedient subjects feel safe in the knowledge that no-one is really being hurt from them playing along, so they do what they are told.

However, there are reasons to doubt this hypothesis (and not just based on Milgram’s post-hoc survey of participants). In one of Milgram’s variations (no 4) the actor playing the learner comes out from the other room where he was hidden in almost all of the other variations and sits next to the subject. The subject’s role here is to physically place – wearing heavy rubber gloves for protection – the learner’s hand on a metal plate apparently conducting electricity if he makes a mistake remembering the word-pairs (the experiments are presented as a way of discovering the effects of punishment on memory).

Common sense dictates that the entire ruse is most vulnerable to being seen through in this variation. The actor-learner has to do some serious and convincing acting, as opposed to, in most other variations, pressing play on a tape recorder at various intervals, broadcasting his pre-recorded screams. So if the disbelief hypothesis is correct, obedience rates should be high here – a sign that participants realise they are being deceived and do what is expected of them. Actually, they are very low – 30% – one of the lowest in the entire series of experiments.

Conversely, in another variation (Study no 13) where participants do not have to directly ‘shock’ the victim, but merely read out the word-pairs while a confederate of the experimenter flicks the switches on the shock machine, obedience rates are very high – in fact, at 92.5%, the highest in the series.

So when the subject was physically closest to the victim, directly inflicting pain, obedience rates were low but when the subject was furthest away from the victim, playing a secondary (though important) role, obedience was very high. These are the kind of results you might expect if most participants had no doubts the presented scenario was real or at least had limited scepticism.

More evidence that Milgram hit upon a genuine phenomenon, as opposed to merely ‘discovering’ a disturbing propensity he contrived to find, is given by the fact that replications of the obedience experiment in other countries recorded, with one notable exception, similar results.

Ethical Obedience

There was then a long gap when ‘Milgramesque’ experiments did not take place for ethical reasons. The reasons concerned the traumatic effect on participants. In several Milgram variations if subjects obediently continue ‘shocking’ all the way to the end they have good reason to believe that the now silent learner is dead or at least seriously injured.

Then in 2008 a California professor came up with the idea of the “obedience lite” experiment. A copy of Milgram’s shock generator was used but with only 10 switches going up to 150 volts. Milgram’s machine had 30 switches, with the highest being 450 volts. However, browsing Milgram’s results, Professor Jerry Burger of Santa Clara University found that the 150 volts was a common stopping point – “a point of no return”. If subjects went beyond the 150 volt mark they often continued all the way to the end.

So here was a way to conduct a Milgram-type experiment without inflicting trauma on participants. And it turned out Burger’s results were comparable with Milgram’s. 70 per cent of his participants were willing to go beyond the 150 volt level – with Milgram it had been 82.5.

Burger’s innovation has allowed a new generation of Milgramesque experiments to take place. For example, between 2014 and 2017 in Wroclaw, Poland, two researchers carried out what they assert is “the broadest program of empirical investigations of obedience since the times of Milgram’s studies”.

In total five studies were carried out using a replica of Milgram’s machine. As with Burger, the highest switch was normally the tenth (150 volts), though in one study subjects were allowed to go up to the 15^th switch (225 volts).

The researchers, Dariusz Doliński and Tomasz Grzyb, are adamant their findings should not be compared with Milgram’s. The one obvious difference is that Milgram’s subjects were encouraged to press 30 switches but they stopped their experiments long before that. But there are others, such as who was recruited, the location, the life experiences of the subjects and the sternness of the experimenter.

However, they are also clear that their experiments show the enduring reality of obedience and the ease with which, given the right circumstances, ordinary people can be induced to obey. 85-90% of their participants (split equally between men and women by the way) exhibited “total obedience” – i.e. they went all the way to the 10^th switch. In addition, the verbal prods – “the experiment requires that you continue”, etc., the same as with Milgram – rarely had to be used.

Secret Agents

In fact, the comparisons that can be made with Milgram are fascinating. Despite wide cultural differences and a gap of over five decades, the overwhelmingly dominant result – in both cases defying predictions – was obedience. Moreover, Doliński and Grzyb believe that Milgram’s original explanation for the behaviour of participants – that they enter what he termed an “agentic state” – is hard to refute.

Milgram defined the agentic state as a “social situation” in which a person is open to “regulation by a person of higher status. “In this condition”, he claimed, “the individual no longer views himself as responsible for his own actions but defines himself as an instrument  for carrying out the wishes of others”.

Doliński and Grzyb tried, fruitlessly, to find other explanations for the obedience of their subjects. For example, the greater empathy of certain individuals or the expectation of swapping places with the victim. In the end, however, they were compelled to return to Milgram’s original hypothesis.

“Despite the passing of many years since the studies,” they say, “the agentic state Milgram proposed continues to appear an important and difficult to invalidate means of explaining the obedience of participants in experiments conducted within that paradigm.”

I am not trying to paint a picture of Milgram as a flawless seeker of truth. Although he belatedly came up with the idea of the agentic state, he didn’t think through the implications of what he was proposing and kept resorting to superficial explanations. For example, that ordinary people were torturers beneath the surface and that Adolf Eichmann, the Nazi executed for organising the Holocaust, personified the dilemma of obedience.

In fact, as the book elucidates, Eichmann was a complete red herring. He was an idealistic Nazi and, on occasion, consciously disobedient towards his superior (Himmler, head of the SS). Moreover, the ‘social situation’ of Milgram’s agentic state, with subordinates obeying orders and “superordinates” delivering them, referred explicitly to hierarchical organisations.  As noted long ago by Hannah Arendt in The Origins of Totalitarianism, Nazism was the very opposite of a hierarchical system. Authority derived directly from Hitler, not from thousands of ‘little füehrers’ lording it over their underlings. Eichmann embodied this very well. He was utterly bound up in the Füehrerprinzip, and felt no obligation to his alleged ‘superiors’ in the Nazi system, only to Hitler himself.

Voluntary Hierarchies

Thus, taking totalitarian systems organised around the leader principle out of the equation, you are left with three hierarchical systems that conform to Milgram’s definition: corporations, bureaucracies and conventional militaries.

However, Milgram also highlighted the crucial effect of what he termed “voluntary entry”. Participants not only freely signed up to the experiment they were told, unequivocally, they were free to leave at any point. Enlisted individuals do not have that freedom. Even if they joined voluntarily and were not conscripted, they are subject to military discipline and cannot just abscond.

So, in truth, you are left with two hierarchical organisations that embody Milgram’s agentic state and obedience to authority – corporations and government bureaucracies. Both are utterly dependent on waged labour.

 In part two, I want to examine the – widely unrecognised – implications of this dependence. Or what Milgram, whether he knew it or not, was really talking about.