1. The explosion-like development of information technologies has made ‘consciousness-shaping' processes one of the most profitable types of generally accessible business activities, and has called in question the existing systems of social control inherited from the past as well as the entire structural set-up of existing human societies. The current financial crisis is only one manifestation of an immense all-round alteration in the entire world order, comparable in scope to the Reformation (out of which there emerged the modern system of social organization based on nation-states).
2. The present-day ‘information explosion' - which turns out to be the third one in the history of humanity (the previous ones being related to the appearance of written languages, and to the invention of book-printing) - has augmented immensely the volume of information available. Accordingly, the last decades have seen an immense rise in the numbers of people who ponder independently over various ‘abstract' subjects (that is to say, the kind of subjects that go beyond the daily practical needs of one's survival).
The existing systems of social control (including that of established academic science which, instead of being search processes looking for new truths, have degenerated into corroboration processes concerning some nuanced aspects of established truths) fail to process the amounts of information produced, and are incapable of ‘digesting' the growing masses of relatively independent individual information producers.
As a result, the control systems in question become more and more dysfunctional, which gives rise to societal cataclysms in whose crucibles a new system of societal organization is forged. In the previous case (that of the Reformation) the cataclysms developed as devastating religious wars (during the Thirty Years' War Germany lost three quarters of its population). The Peace of Westphalia of 1648 put an end to the wars, and out of it there emerged the modern type of State.
3. The widespread use of computers has radically augmented the importance of creative work based on insights and image-based thinking rather than on theses-based thinking and the consecutive use of logical conclusions. Indeed, the computer formalizes logical thinking, bringing it to a perfection that is unattainable by humans - just like the calculator brings to perfection the use of simple or not so simple arithmetic rules.
We still remember the time when the use of calculators was strictly forbidden by teachers at our schools: that was done to make the schoolchildren learn to do multiplication and division sums using the age-old ‘column formations'. These days, however, the ability in question is no longer in demand: the calculator can do the work better than humans, whereas our job is to formulate problems correctly.
What the calculator has done with our arithmetic, the computer will do - in the foreseeable future, within a decade or so, - to our use of formal logic as such.
This means that what will fall to humans' lot will be the kind of thinking that can only be accomplished by humans, which is creative thinking; therefore competition between people, in various collective entities and societies, will develop based primarily on their use of creative thinking rather than logical thinking.
Accordingly, creative individuals and the collectives where such individuals' share and role will be especially significant will be more competitive than others on a national scale as well as globally.
Meanwhile, in terms of their psychic organization creative individuals tend to be schizoids. It is the type of unbalanced personality that suits the requirements of creative activity best of all.
The point is corroborated convincingly enough by the widely available statistical data pertaining to creative people's character and course of life in various domains of activity.
From which it follows that any manager's nightmarish vision - that of a team (or even a flock) of schizoids - may turn out to be the most efficient and competitive instrument of action in the not so distant future!
Evidently enough, the present-day systems of control can hardly adapt themselves to, and operate in, such conditions, therefore such systems will have to undergo a cardinal transformation. Also, since it is the social control system that determines the main principles of societal organization at large, any cardinal change in such system will lead necessarily to a cardinal change in societal organization!
4. It is essential that the globalization process has given rise to a societal trend that has never been on the scene in the history of humanity as we know it.
Those very technologies that have radically facilitated all kinds of social communication have contributed to turning ‘consciousness-shaping' activities into the most paying of all generally accessible business activities. If an activity is described as ‘generally accessible' and, at the same time, 'the most paying', this means that it is, strictly speaking, a principal activity if not for the humanity at large, then at least for the most developed and successful part of it.
The change in question is of fundamental importance. This changes the very nature of human development: if throughout the entire extent of its previous existence the human race have survived and evolved by transforming the environment, then now it has started - or is at least trying - to develop by transforming itself (changing human consciousness).
Ecologists are likely to be in raptures over the news: having approached the limits of admissible anthropogenic influence on the environment, the human race may have embarked on the road of adapting themselves to the environment! That seems to be a greater triumph for the environmentalists than any prospect of conscientious rejection of the good things of life by popular masses.
However, the transition in question has been conducive to diminishing the importance of knowledge for human societies and, accordingly, to wrecking education systems in the developed countries.
The main function of education is now to ensure submissiveness and tighter social control over the developed countries' populaces. After all, if industry needs better socialized individuals, then the existing information technologies, due to the increased productivity they contribute to, may make redundant up to three quarters of the population - turning the former middle-class people into marginal social strata. We witnessed that in the post-Soviet republics, in Eastern Europe and Latin America. Now similar processes are developing in the USA and, to a lesser extent, in the EU.
What is especially important, however, is the following: the processes of ‘consciousness-shaping' on all the levels of its existence, from individual level to, at least, group level, develop spontaneously, chaotically, and, so to say, accidentally. It is not known to what extent the consciousness thus shaped conforms to reality, or to what extent it is ‘adequate' or ‘inadequate'.
The existing systems of control are not adapted to the employment of consciousness-shaping technologies. This results in a dramatic decrease in the efficiency of control processes. The most significant ensuing effects are as follows:
Self-programming: a top controller and a control system on the whole come to believe fervently in their own propaganda - even though they may have been well aware of its ‘unreliability' when they launched it;
Instead of controlling changes in reality they begin to control changes in its perception;
They give up, in principle, perceiving reality in favor of perceiving its reflection in the public information space (i.e. in the mass-media, above all);
The level of accountability for one's controlling/governing actions goes down dramatically;
The scope and quality of feedback from controlled society to controlling/governing system decreases dramatically, which amounts to a demise of democracy in the American conception of it.
The above effects can be observed, more or less sharply, in virtually all systems of government, including such countries with very different yet very efficient systems of government, as the USA and China. The quality of control decreases dramatically everywhere.
5. The depth of the ongoing financial crisis is underestimated because its fundamental cause is ignored or disregarded: the opportunities opened within the model of global development created resulting from the disintegration of the Soviet Union have now been exhausted. In the aftermath of its victory in the Cold War, the Western powers revamped the world in the interests of their global corporations in such a way as to deprive most of the humanity of opportunities for normal development. This led not only to growing international tension, terrorism and migration. It was conducive, too, to limiting selling opportunities of the developed countries themselves that went down into a crisis of overproduction.
6. Stimulating their sales by extending credit to underdeveloped countries gave rise, in 1997-1999, to a debt crisis, which boomeranged against the USA in 2000-2001. The USA, then, dragged itself (as well as the world economy in which their role is pivotal) out of the oncoming depression using the following two strategies:
One is the ‘export-of-instability' strategy aimed at undermining rival countries. Economically speaking, its aim is to force the rival countries' capital assets and brains to flee to the USA as a ‘safe haven'. The growing instability abroad is also a rationale for increased military expenditures in the US at the expense of stimulating the development of other markets and technologies (the so-called ‘military Keynesianism' effectuated by the Reagan administration). In 1999, the strategy was used, in Yugoslavia, to destabilize the Euro zone. In Iraq, however, it was no longer as effectual. At present, the USA is destabilizing Pakistan to inflict damage on Iran (by creating a new ‘zone of chaos' at its borders), and on China, which may lose, as a result, its influence in Pakistan, a large oil port in Gwadar (under construction) and, possibly, a military base in that country. The developments in Pakistan show that the ‘export-of-instability' strategy is generating into an ‘export of chaos' which is counterproductive for the economic development of the US itself: the US is no longer even trying to control the destabilized territories, and has thus become a catalyst of a global political and military crisis.
The other strategy used to support the US economy consisted in pumping up the market of unsecured mortgages (which was also a form of social aid). The financial bubble thus created began to go to pieces as early as summer 2006, yet, owing to the multi-level set-up of the US financial infrastructure, that did not entail an immediate crash but to a protracted agony which came into the open only now.
The reckless and unbridled growth of derivatives, the massive handouts of obviously irrecoverable mortgages, combined with a sophisticated multi-layer system of ‘risk repackaging', have become the three immediate causes that started the current global financial crisis. Taken together, they can produce a stupefying impression on any unprepared observer.
Indeed, it is difficult to conceive why the American and other western investment bankers - known to be sane, rational, professionally competent, well-educated people - have failed, en masse, to assess the risks of financial products they bought, and even were not in the know as to which specific liabilities, and to what extent, those products comprised.
One should remember that the multilevel system of ‘risk repackaging', which have led, in the end, to the regulatory agencies' (and of course market agents') total loss of control over liabilities circulating in the market, did perform an important economic function - that of insuring investors' risks.
Actually, quite a lot was achieved on the way: owing to the multilevel system of derivatives, the risks of an investor placing money in the high-grade bonds of an American corporation were a cut - about ten times! - lower than the risks of a corporation itself.
This secured virtually guaranteed levels of profitability for investors, and it was the security function of derivatives that ensured their impetuous growth and, accordingly, the impetuous growth of the speculative ‘financial bubble'.
The USA - and with it, the entire world economy - are now faced with the effects of the law of conservation of risks. According to the law, the overall amount of risks within a large system is approximately a constant quantity. If individual risks are reduced for a large number of participants in a system, this necessarily results in the transfer of risks up to a higher level and, accordingly, to increased risks for a system as a whole. If, for instance, individual risks, within a system, are reduced to a minimum, the risks for the whole system will grow to an extent that will ensure, normally, its destruction.
This is precisely what has happened to the American financial system, but the same is true for the human race, too!
More specifically, the gradual improvement in health services has greatly enlarged opportunities for the survival and, even, full-fledged human existence of people who suffer from most serious illnesses. The substantial reduction in individual risks, however, leads necessarily to a deterioration of the genetic fund of humanity, increasing risks for the human race at large.
Going back to the financial crisis, let us note this: at the beginning of the present decade the speculative ‘bubble' used to stimulate the US economy was moved from stocks market to the market of real estate. The summer of 2006 saw the first signs of ‘steam' coming out of the bubble. In August 2007, a correction of it was launched, the process going out of control all at once. In September 2008, the bubble broke.
As a result, the US economy lost a mechanism for development, while other developed countries lost the largest source of demand for their products.
7. A new provisional global equilibrium can be attained by restoring a bipolar political system (the USA versus China, with Russia leading perhaps a new kind of ‘non-aligned movement'), and a multi-currency system in the world economy (each currency zone having its own reserve currency).
8. What the West is currently trying to do is hardly an attempt to increase its competitiveness. It is, rather, an attempt to thrust the world back into the 1990s and early 2000s, when under the guise of high-flown talk of ‘globalization' a new US-centered colonial system was actually installed.
The inherent inability of America to go against any of their established interests for the sake of settling their own strategic problems, their deadly blind selfishness is literally pushing new players onto the proscenium of global development, thus putting an end to the post-Cold-War Pax Americana. Those new players are the European Union, China and, maybe, Russia (in case our leaders show a degree of intellectual integrity).
What is needed must be a qualitatively new global financial system, a new kind of "Bretton-Woods agreements for the 21st century". The most essential reforms to be put into effect were formulated as early as in the crisis of 1997-99. They are as follows:
Ensuring the transparency of movement of speculative capital (in prospect, the transparency of movement of capital for all global corporations, with the creation of a global monitoring body, then a global regulatory body);
Turning the Tobin tax (excise taxes introduced against speculative capital transactions, actually a 15-percent prohibitive tax on any short-term cross-border capital movements) from an emergency measure (in the crisis of 1997-99, the employment of similar measures saved the economies of Malaysia and Chile) into a normal and recognized instrument of economic regulation to be employed by national governments under certain well-defined conditions;
Changing the share of influence of various countries on the policies of global financial institutions (such as the IMF and World Bank, first and foremost) in accordance with the countries' share in the world economy (this means an increased influence of China, and a decreased influence of the US);
Ensuring the transparency of the IMF's and World Bank's operations, by making their methodological materials public and open for discussion (including the stage of their elaboration);
Turning the G8 into a body of global regulation, which means that it should include at least those countries whose GNP is not lower than that of Canada's $1.6 trillion (this amounts to turning the G8 into G11 by including China, Brazil and Spain; if the threshold limit is lowered to $1,0 trillion, the G8 will grow into G14 comprising India, Mexico and Australia; the club may be further enlarged by including South Korea and the Netherlands, whose GNPs, in 2008, are expected to reach $0,95 trillion and $0,91 trillion, respectively), as well as elaborating procedures for taking the decisions that will be mandatory for all the member-countries;
9. The most critical problem, however, does not lie in the American selfishness, nor in the deficit of liquidity, nor in the debts crisis. What is lacking is any serious source for growth in the US economy, and consequently, for the world economy at large. Even if one normalizes the US financial system, that will not cut the crisis of overproduction for the global monopolies, nor will create a new economic mechanism instead of those that collapsed. This means that out of the present crisis the world economy will go into a protracted and painful depression rather than a recovery.
The fundamental cause of the oncoming world depression lies in the established global monopolies' global decay. Such crises can be overcome by changes in basic technologies: innovating, and more productive, technologies break outmoded societal relations, including those of economic monopolies.
The global monopolies are aware of such ‘dangers', and are trying to slow down technological progress so far as it may undermine their dominance.
The monopolies are creating more and more complex and expensive technologies - such technologies that cannot be effectuated and sustained without them because of the high costs and organizational complications involved. The complexity of organizational processes involved may exceed the managerial capacities of such global monopolies themselves, while the prevailing marketing orientation restricts possibilities for breakthrough kinds of innovative research with unpredictable outcome.
At the same time, the global monopolies (often protecting their monopolistic practices under the guise of protection of intellectual property rights) hinder the spreading of knowledge, which creates additional obstacles to technological progress, making it more costly and slow.
Their basic objective is to ward off processes leading to the emergence of far simpler, cheaper and more popular technologies, which would make it difficult for the monopolies to strengthen or retain their positions.
Meanwhile, the methods of such simplification and price reduction are, in principle, already known. One example showing a promising line of technological development is the Linux operating system whose operation is independent of intellectual property rights. Being free and technological-progress-friendly, it is squeezing out Windows in some of the world market segments.
A decisive breakthrough has not been achieved yet, however: Microsoft retains its global monopoly on the market in question. On the whole, the positions of global monopolies are very rarely questioned, so the example of Linux should be seen as a promising exception from the rule - or a promising harbinger, if you like.
Our belief in the inevitability of radical simplification of prevailing technologies, accompanied with their price reduction, is based on the assumption that it is impossible to slow down technological progress for a long time on a global scale. It is also based on the awareness of a technological, economic, and political deadlock in which the world find itself due to the dominance of decaying global monopolies.
The simplification process in question will be a painful one due to a variety or reasons, including the resistance on the part of today's ‘masters of the world', the global monopolies. However, there are no reasons to expect that one of the fundamental regularities of development will no longer hold true. The regularity in question says that societal and administrative mechanisms that curb technological development will collapse sooner or later.
One should remember, however, that in case the said mechanisms (in our case, global monopolies) turn out to be strong or powerful enough, they may collapse together with the societies they happen to control technologically and socially. This may happen due to attacks by foreign conquerors, due to ecological cataclysms (including deadly disease epidemics) provoked by their ‘over-action' on natural environment as well as through their generating internal societal instability in the form of social or ethnic conflicts.
More specifically, one not so trivial a method for a provisional way out for them (when the demand is insufficient for the monopoly-controlled development of artificially complicated technologies) may be the narrowing of spheres of application of their technologies while retaining the previous levels of revenues in return. This is possible through their taking advantage of their monopolistic position in a more aggressive way: in that case many consumers of the monopolies' complicated technologies will pay, without knowing it (like it happens nowadays with intellectual property rights), for the development of qualitatively new technologies designed not for the consumers in question but a more developed part of humanity. It is possible that those qualitatively new technologies will be used to accelerate the development of some part of humanity which will undergo a principled transformation (which is impossible to foresee now) and will no longer need the traditional forms of competition and cooperation.
This may sound fantastic only with reference to the biological evolution of a human individual. With reference to social evolution the above-described events have already taken place: this refers to the creation and dissemination not only of established high-tech technologies through the system of protection of ‘intellectual property', but also the generally accessible technologies of consciousness-shaping. Those technologies can be employed by everyone and against anyone, yet the major part of the income involved goes to those who developed them.
If the same processes are extended onto biological evolution of human individuals, the well-off strata in the developed countries and the privileged rich minorities in the rest of the world might be in a position to improve their organisms (including ways that are unthinkable now) and, probably, their intellectual capabilities.
Due to their increased effectiveness the rest of the world will be turned into a sort of milch cow for those people and - even though it might retain some formal institutions of democracy - would enjoy in fact as many true rights as the aforesaid praiseworthy animal.
The pattern of demand that would emerge in that case is typical of underdeveloped countries (and feudal society): most of the demand would be concentrated within the numerically small superrich economic and political elite, with their serving personnel paid well enough to keep them loyal. The rest of the populace would have to resign themselves to pauper-like levels of consumption and, in the end, pauper-like patterns of consumer behavior.
The only effective marketing behavior, under such condition, aims at satisfying the demand of the rich whose consumption is motivated by reasons of prestige, which would disfigure, in turn, the structure of production, undermining the effectiveness of society, and its potential for development.
That is a historic impasse, and going out of it would lead to cataclysms of horrible proportions (France, for instance, was shaking with revolutions for nearly a hundred years, from 1789 through 1871). Human society may disintegrate and perish in the impasse; the aforesaid way out would be provisional and, indeed, fictitious.
The choice the human race has to face now is a choice between demolishing the global monopolies by developing and spreading new widely accessible technologies, and a concentration of technological progress in the richest strata only, followed necessarily by a global destruction. It is unlikely that one of the two models could be realized in its pure form, but it is one of the two that will prevail anyway.
The choice between an ‘iron-heel-rule' of the biologically transformed superrich world elite, and creating as many opportunities as possible for as many people as possible throughout the world has not been made yet. In fact, few people so far are aware of the choice as such.
Though the model based on the development of widely accessible technologies may have lots of defects or shortcomings of its own, it is, nevertheless, far better than the rival model: within it, a potential of development, self-realization and prosperity is retained for most human individuals as well as all the civilizations and humanity as a whole.
10. The technological spurt to dismantle the global monopolies' power may proceed from the so-called ‘closing' technologies - so called for the reason that, due to their super-productivity, the new short-term market capacities they create are substantially lower than the capacity of markets ‘closed' because of their emergence.
Historically, the ‘closing' technologies were developed, for the greater part, within special-research efforts in the USSR. In western countries, such works were not carried out at all (because they were seen as a threat to market mechanisms, and because the market economy does not encourage spending resources on risky works), or were blocked by patent mechanisms and other instruments of ‘intellectual property protection'. In the perspective of technological progress, the destruction of the Soviet Union looks like a burial of technologies seen as deadly dangerous for the developed world (kind of as dangerous as plague bacteria) in one huge burial place.
In today's Russia the global and Russian monopolies, in alliance with the corrupt bureaucracy, are blocking the spread of ‘closing' technologies. However, many of them have been retained and still exist, and therefore Russia may, in principle, play a key role in the choice of humanity between the prospect of protracted and painful decay, and that of dismantling the dominance of global monopolies by spreading new kinds of ‘closing' technologies.