Tony Bella Don't Pays

Phil Burpee

Phil Burpee, Columnist

Many long decades ago during my misspent youth, I spent a few years living in a Little Italy in a city back east. It was a good neighbourhood. Rents were cheap, kids still played outdoors, they hadn't invented yuppies or joggers yet (YAY!), and people lived  and visited a lot in the summer time on their front stoops. At the local grocery store you could get a real nice selection of pastas and olive oils and cheeses, and young men with black sports jackets, white shirts and slicked back hair were to be seen loitering around the street corners, trying to look as sharp and dangerous as they could manage. The local corner store was run by a man called Vito Ciliberto, who presided over his tiny empire with a certain genial authority. You could scarcely believe how much stuff he had crammed in there - tampons to pet food to spark plugs, but mostly I just went for cigarettes and late night snacks - "Hey Veet - gimme a packa Player's Plain - and maybe a couple bags of those Twizzlers there." But Vito was all-seeing, and the local rug-rats wouldn't even think of trying to scoop a couple bubblegums - not worth the risk - prices aren't prices for nothing. Long about late August or early September, the empty Zinfandel crates would start to show up on the sidewalks. The grapes from California had come, and thousands of gallons of wine were being put up all over the neighbourhood. Pretty soon a lot of singing started pouring out from the back alleys, as the necessary early sampling elevated the general cheeriness factor by about ten points. On the surface of things, pretty much an urban paradise. But down under the freeway overpass about three blocks over, there appeared one day a slash of spray paint on the concrete wall - 'TONY BELLA DON'T PAYS'.  Yeah - there was the hidden world at work. Mr. Bella was apparently in arrears with his payments - and probably not to the local RBC either.

Time's up!

You could say that everybody owes something to somebody - if nothing else, the debt each and every one of us owes to our mothers for this very life itself. But for most of the history of human civilization, the idea of debt has been tightly constrained, typically restricted to certain forms of commerce and/or a tally form for favours done for an acquaintance or business colleague. In Tony Bella's case, it was likely a matter of a bad gambling habit, or some intemperate lifestyle choice. But, by and large, debt has been an operating principle at the fringes of society, always present, but never, until fairly recently, poisoning the very core elements of our collective culture. Not no more. It has now insinuated itself into the mainframes of our lives and our notions of what it is to be somebody. It has become the new original sin, infesting the lives of every person born into a world which has lurched wantonly off the ancient rails of cost benefit. Indebtedness is the new baptismal, marking every child as an acolyte of Mammon. Debt offers you that which you have not earned, and promises you instant material gratification - at 28 cents on the dollar at credit card rates.

Debt as we have come to know it in the modern world is a deviant form of capitalism. It was never meant to be a central tenet, but rather merely one aspect of a toolset designed for the movement of goods and services. In the simples terms, it would be a capital debt providing for the establishment of a cash-flow in some new enterprise, following which monies would be apportioned back to the lender, at appropriate surcharge, as quickly as the success of the new enterprise would allow. But the idea was to step out of the state of debt and onto the durable platform of self-capitalized equity. One of the first segments of society to lose the ability to dissolve financial indebtedness was farmers. Typically and increasingly over the last fifty years or so, farmers' costs of production have too often outstripped their returns. There are many reasons for this, but it is fundamentally a consequence of bad food policy in our systems of governance, along with an almost complete taking over of the machinery of distribution by monolithic corporate agri-business. Once the predatory elements of the stock market got hip to the fact that farmers were tethered to the immutable demands of the 'biological imperative' - plant, nurture, harvest, ship - they came to realize that they had the perfect victim. A simple tweaking of commodity prices (aka market manipulation) would guarantee an industry-wide population of chronic borrowers - for what else is there to do when it's time to buy seed than to go find some money? And when the seed merchants and the money-lenders become virtually indistinguishable at the top end, then there is cause for a deep concern indeed. In the Third World for instance, Monsanto offers, in effect, banking services for peasant farmers so that they can afford to buy replacement seed for their genetically-modified crops which now produce no seed. This is not commerce - it is codified slavery. And it is scarcely better here in the rich world.

Elsewhere, the average student loan these days runs to anywhere between fifty and a hundred grand - and that's before you even start your first real job. What happened? Were we on vacation or watching the ball game or something? How the hell did the banks manage to insinuate themselves into the lives of young people to such an extent that the very first thing they have to do as young adults is service a staggering debt-load. Exactly whose bright idea was this anyway? In many other countries the idea of abandoning youthful seekers after knowledge to the talons and hooks of institutionalized usurers would be unimaginable - but we have come to the point where it is an accepted norm. What a sad commentary. The most precious commodity imaginable, the minds of our young, has been dumped into the marketplace like so much beef. It is akin to the aforementioned Monsanto, which cut its teeth on formulating defoliants such as Agent Orange for the Vietnam War, determining that a good dollar was to be made off patenting life itself in the form of seed. It's twisted and grotesque. Similarly we say to our young people - "We no longer expect you to earn your birthright in society - we expect you to buy it - at prime plus whatever the current market can squeeze."  What will we allow them to tap into next? - mortgaging babies might be a nice little earner - gotta find a way to patent the little squealers first though.

And speaking of mortgages, let us briefly consider that modern catch-phrase, 'household debt'. You hear it on the news along with 'housing starts' and 'consumer price index' and 'cost of living adjusted wage levels' and 'consumer confidence', etc. It is spoken of gravely by various talking heads on the TV from government Ministers to CIBC economists to union honchos to monetarist pundits. This is another thing that we have come to embrace as a matter of normalcy - every household is expected to operate within a cocoon of debt. It currently stands, according to BMO, at approximately $112,329.00 per household in this country (ie. we are insolvent), and it is a mainstay of the modern economy exactly because it creates money out of nothing in the form of billions of dollars in interest payments sent back up the line to the ultimate lender of last resort - an agent so vague and arcane as to be virtually invisible to any but the most lofty of operators. Because the whole world is in debt - and good luck trying to find out to whom, ultimately, all that money is owed. Good luck because, in the final analysis, it is all a grand planetary shell-game, and, given that, as Bill Bonner would have it - "The long run value of all paper currency is zero" -  we perhaps begin to realize that the emperor indeed does not have any clothes at all, for the final capital upon which our model of capitalism is based is a fiction, and actual value for work has ceased to be an operating principle, even as a dollar is no longer redeemable for its value in gold.

Prior to somewhere between the First and Second World Wars, the idea of indebtedness was anathema to good economics and good governance. But then along came mass production of goods, and along with it the manufactured desire for those same goods, and soon the need to be able to 'have' those things which were being increasingly advertised through mass-media outlets began to overcome the ages old accepted wisdom of maintaining a freehold stance in life. It was no longer acceptable to wait for things as a long range goal of careful earning and saving, but rather those things must be had right away - and I mean like NOW - slap the plastic down and get that thing - pay later, pay later, pay later. And although capitalism is an unmatched tool for the advancement of civilization through the creation of jobs and wealth, we begin to see that it is becoming a bankrupted idea, being based, as it is, on never-ending growth and the need for ever-expanding consumption of goods and services. Debt has become the new capital - a sure sign that the big tour bus we call our economy is running on vapours. Once we can no longer go down to the bank and cash in the pipe-dream, then it'll be pretty clear that the party is over.

Sometimes I wonder whatever happened to Tony Bella. I hope he made good and paid his dues accordingly. The Man always gets his money though - of that you can be sure. The longer we continue to pretend that what we are currently doing by way of shuffling debt around is an excuse for an actual economy, the sooner we will reap the dire rewards. The only true capital is this big old world from whence we derive everything.  And bit by bit this ever-compounding debt of ours is being called in. Payment must be made. The note must be honoured. The balance sheet must be made clear. Yes, trouble's brewing - the spray-paint can is coming out - 'HUMAN RACE DON'T PAYS'.  I don't know about you, but I find myself looking over my shoulder more and more these days – specially when the music suddenly stops  –  ‘O, so-lo mio………’.

Phil Burpee
July 21, 2012