change of venue

Griffith now publishes at http://griffithlighton.wordpress.com/

Existential Value and Risk Modeling

According to reactionaries, like Forbes, the natural tendency to dysfunctional psychopathy usefully operationalizes with capitalism to save us from ourselves.

A psychopathic personality is, objectively (i.e., reason free of moral sentiment), a survival mechanism. By nature, a system evolves modeled to minimize the risk of loss by maximizing productivity (expanding the pie as Paul Ryan explains). Instead of looting ourselves back into feudalism, the free-market mechanism operationalizes selfishness (greed) with the productive capacity necessary for us all to be self-determined by natural right, and survive.

Yes, as Forbes points out, we are all functionally psychopathic and we naturally compete in the marketplace to peacefully resolve conflict in the alpha dimension. As long as we maintain a free-market in which risk is directed into an on-demand ontology there is little question as to whether the reward is legitimately earned. This legitimacy of the risk proportion, reactionaries explain, is not derived from a utopian vision--it is not to be measured against a world of ideas, for example, in which there is a formless, and thus unmeasurable, reality. Objective reality is not a product of pure mathematics but the application of the risk in which the profit margin empirically measures the reward legitimately derived from the inherent risk.

(Think of the ontology this way. Let's say you go bowling. The objective is to knock down the pins and the score empirically values, or confirms, the capacity for achieving the objective. While you are determined to knock down the pins if you want to play the game, you do not perceive that the pins are causing you to throw the ball although that is the objective. The pins are not pulling the ball to the pins. You are throwing the ball at the pins by objective.

Despite the action of throwing the ball with teleological determination, the objective result--the ontology--is the pins being knocked down. Ontologically, you can then say the pins are pulling the ball to the objective.

The objective reality depends on the existence of the pins, and achieving the objective--the empirical measure of success--depends on how they are arranged, or organized, to most effectively knock them down.

Organizing the pins is critical for determining the level of success, which will change over time to minimize the risk of loss. To keep the risk the same for everyone requires governance that Romney and Ryan, for example, identify as the problem, not the solution.

Bowling is a pretty simple game, as Forbes points out, until the pins are reorganized to deontologize the risk.

Plato and Aristotle said the deontology derives from the perfect world of ideas. While you have the idea of what the perfect game looks like, with the empirical value of 300, the probability you will attain it is slim unless, of course, you can reorganize the pins to maximize the probable outcome. By manipulating the probability of the risk you can at least minimize the probability someone else will win driven by the common purpose of attaining the perfect score. This common identity existing in zero-sum is from whence the risk is derived, and because we cannot all share in the reward we have the ontology of limited supply against unlimited demand.

To deontologize the risk, Romney and Ryan, for example, pledge to increase the number of pins, and balls to knock them down, by reorganizing the supply we have now so that the wealthy have a disproportionate supply relative to their numbers. In order to gain more balls and pins it is necessary to give up some of the balls and pins you have now to those who already have half the supply in their possession. Even though the numbers don't add up in the world of pure mathematics so that everyone has a chance at the perfect game, the world of pure mathematics does not exist in the real world of objective reality, which requires the secret knowledge of elite power and authority to properly identify with it.

The real-world reorganization that Romney and Ryan propose, despite any supply that may be added, is a zero-sum redistribution of the reward. By application of the exclusive knowledge--the technical expertise--the rest of us can only remotely comprehend, the elite organize the risk into what only appears, they claim, to be a zero-sum detriment. The expected value occurs in late order, but because those that do not properly identify with objective reality want to avoid the risk of failed expectations now, at present value, the result is, foolishly, the failure to be avoided.)

To manage risk is to purposefully derive reward from integral value, and this value, according to reactionaries, is produced and consumed by organizing the marketplace to efficiently manage risk by avoiding it. (When Mitt Romney avoids taxation with secret accounts, the risk is not reduced. The probability it will occur is shifted to the future, currently taking the form of a huge budget deficit that demands taxation, and remember, production and consumption on-demand is a risk ontology managed with purpose using organizational technologies--like RTV's, dark markets, and secret accounts--derived to fit that purpose. Once derived, these technologies dominate our objective reality. Technology pulls us into a regime that does not fit the objective, becoming what the materialist philosopher, Thomas Hobbes, for example, described as the "Leviathan." A big, self-determined ontology presents--manifesting the fully assumed risk of loss--as the risk to be avoided, which obtains in the reactionary language we hear today like, "government is the problem and not the solution.") The people best able to avoid risk are those with the character to be free enterprising, entrepreneurial, and self-determined, naturally organizing an economy with technological advancements (economies of scale, for example) that objectively identify with (or model) their self-interest.

(Remember that according to efficient-markets theory, firms achieve an economy-of-scale because nature dictates it. According to Nobel Prize economists, for example, with mathematical proofs utilizing the statistical analysis of game theory, markets naturally reduce to just a few firms to not only produce the cheapest product sold at the highest possible price, but to control the rate of innovation. Both values exist to resist the declining rate of profit, but efficient-market theorists do not readily admit to that because the natural ontology, they argue, is to resist risk in priority by organizing to maximize the profit. So you see how the bowling game analogy works here: capitalists do not greedily act to knock down all the pins, the pins draw them into the act of knocking them down with increasing efficiency to resist the fully assumed risk of loss.

An economy-of-scale controls the rate of substitution. So, for example, when Exxon-Mobil gets billions in subsidies, it is resisting the rate at which its firm competitively fails. In other words, the market that Forbes and prize-winning economists say is necessary to attain the efficiency of so-called free-market economics is not a free market at all. The free-market legitimacy that by natural right converts the consolidation of capital into earned income, wealth, and power does not, in objective reality, exist because it is naturally inefficient.

According to efficient-markets theory, which the Obama administration and its current opponent for that office both support, an economy-of-scale does not resist innovation. Instead, it creates more value than would otherwise exist because it is more able to consolidate the capital necessary to take big risks.

Ouch! Don't we all know what that means! Allowing industry and markets to consolidate to achieve economy-of-scale efficiency models the risk proportion that a free market is systematically--safely and soundly--supposed to avoid with the legitimate, unquestionable objectivity of collective moral authority "We" call government by consent!

A marketplace freed of consolidation and protected by government authority--exactly what reactionaries like Forbes argue against--allows for maximum self-determination at the lowest possible cost. Isn't that the existential value "We the People" are looking for?)

What derives from the risk is existential value (what psychologists call "self-concept"). The best and the brightest are not the most highly rewarded because they are criminal psychopaths, Wall Street explains, but because they are realists, objectively operating without the utopian visions that always prove to be dystopically tyrannical and unproductive with the force and legitimacy of moral authority.

Selfishness is not a character flaw that condemns us to dystopia. It is a character trait that successfully reproduces in a free market to conserve our natural existence against the odds--the fully assumed risk of loss.

(Keep in mind that the character trait argument is plausible but not entirely convincing. Forbes suggests this hypothesis in his book, "The Freedom Manifesto," but it is the typical, reactionary, exculpation of the risk-reward distribution that argues all the bad things people have to say about people like him ignore objective reality. Wall Street behaves the way it does, reactionaries argue, because of the "human condition"--naturally greedy and thus functionally productive, which is more a virtue than a vice.

Going back to the bowling game analogy, if capitalists didn't consolidate the pins, and the balls you need to knock them down by objective, then you wouldn't be willing to produce more pins and balls so that everybody can play the game. The logic here is that the more playing the game is deprived, the more the game is played...and if you can demonstrate that bunch of $#&*@! mathematically, then you SHOULD win the Nobel Prize!)

Being selfish is integral to the reward. Even with the application of a utopian vision we can be sure that satisfaction of the self will be derived to form a divisible distribution at the top in the name of maintaining the moral imperative of a peaceful and prosperous existence at the base--what Hobbes described as a "Leviathan" that fully assumes the risk of loss and transforms it into a fractal extension of a fully functional psychopathy.

What philosophers of the risk proportion, like Steve Forbes, don't say is that the extension of the rents he proposes, by limiting the money supply to a classical, economic proportion, builds the Leviathan. It builds up the body politic to resist contagion and support the model of equilibrium--the status quo. The body eventually loses its resistance and support breaks down with the risk being clearly indicated, and preventable in a crisis proportion, if the modeling allows for its perception. If the indicators are misread or ignored the result will be catastrophic illness for the body politic, reacting with the delusion of immortality that only serves to hasten its demise.

Right-wing reactionaries refer to the risk modeling of Hobbes (a 17th Century political philosopher) because it suggests the natural right to revolt against a system that does not apply the self-interest of the people (a system with a divine-right legitimacy, for example, not unlike what we have today when reactionaries describe the right to property adversely possessed, or earned, in the marketplace being derived from nature or divine providence). Hobbes was essentially describing a fully assumed risk of loss: risk-value integral to our natural existence.

Reactionary philosophers like Forbes want to disprove the existential value of utopian socialism (dialectical materialism) in particular. Using Aristotelian logic, like Ayn Rand (and prize-winning economists), he argues the integral value of utililizing a fully functional psychopathy to avoid the fully dysfunctional psychopathy we have now derived from neo-classical risk modeling.

Aristotelian logic like Rand uses, despite claiming to be objective, is not an empirically based analysis. Although the method she and Forbes use to describe objective reality and our true, existential identity is logically conditioned, it models an a' priori, objective identity. If we deviate from the norm of the working model, as Aristotle explains, we deviate from objective reality and the identity of our natural existence. We start living in a delusional, utopian, dream world that does not rationally model objective reality.

According to Forbes, for example, the free market (free enterprise without government intervention) mechanically models the reality of our existence. The results are not an a' priori condition but the empirical proof of our natural condition a' posteriori.

Free enterprise forms a morally sound, force-majeure ontology--a freely enterprised system of rewards and deprivations which, of course, exculpates the risk Forbes says is earned and not plundered. Since everyone is equally free to earn (or plunder), the results are logically legitimate--the results are ontological (objectively rational, like the pins drawing the ball to knock them down), which means there is no usurpation of power (no moral, gamma-risk dimension that I argue, for example, to be the ontology at work) and, thus, no need for government intervention.

The outcomes are purely logical, conditioned on the capacity to win in the marketplace by, for example, modeling risk so that it perpetually produces debt and default force-majeure. We are then "forced" to make the market more efficient to control the risk proportion--it is a logical condition, which is then mathematically modeled (like Tycho Brahe's retrograde motion) to validate the objective reality of the model with pure, irrefutable logic.

Pure logic, despite being irrefutably conditional--not deviating from the normative model that is morally imperative--is always subject to empirical confirmation, however, as Thomas Hobbes was apt to point out, by natural right.

The more we want to be without risk, as Hobbes suggested, for example, the more probable it is we will discover what we do not want to be.

After the latest Jackson Hole summit, the Fed chair says we have avoided being in a deflationary spiral. The Hamiltonian model is working to keep the global economy liquid despite tremendous pressure to liquidate the increasing debt burden.

Risk has been modeled to produce an existential value that depends on always being on the brink of default to keep us productive instead of poor and dependent on the king (government). Instead we are dependent on demand in the open market. Should we not question, however, the value of always being on the verge of being what we do not want to be, always acting to avoid crises by converting equity into debt on demand.

(Remember, the Fed is not exactly an organ of government, but is an organ of self-governance. Its assets are private property, which means, by natural right, unlike the king, it is not sovereign wealth to be legitimately held to public account--it is not retributively valued--as Hobbes suggests. Fed assets are managed in secret accounts, holding value in reserve, turning risk on or off as its owners see fit to govern demand through its Open Market Committee.)

Not only do we have a central banking system that relies on debt to avoid detriment but we have a binomial, political alternative that relies on debt as well. Voters are determined to identify the problem as the solution. The identity of the risk is conserved so that, by avoiding the probability of the risk, what we are is never defined by who we want to be.

An ambivalent, objective identity is the product of social contract theory, confirmed by Paul Ryan at the 2012, Republican National Convention when he declared, "We will lead and not govern."

Ryan is referring to the conservative sentiment that the republican form of government is more about the application of elite authority by natural right which, if you are one of the chosen few, is what "We" mean by self-governance. The non-elite participate by contract, and when the elite break the contract, which Obama stands accused, the majority rules, as Hobbes suggested, to establish a new contract.

Contrary to Ryan's conceptual model, the Hobbesian choice of our natural existence is government by consent. The more we are led, the more we want to govern. The more we avoid the risk the more likely we are to take the risk and become what we are led to believe we don't want to be. (This ontology of the risk that Hobbes suggests is why we have a binomially structured political system--a Leviathan, a kind of Hobbesian choice, in which the head--the leadership--talks the talk and the body walks the walk no matter what the stakes are.)

Existence is not a derivative, contractual obligation subject to arbitration. That there is meaningful existence only by derivation of the value is a pathogenic conceit suggesting there is no objective reality, only the rule of law and binding arbitration. Existential value does not derive from contract law, which demands government to enforce it, but a natural right integral to the value of the risk that a social contract cannot void.

Hobbes is referring to existential value contained in the organism (the establishment, the Leviathan) that models the risk, which Darwin later referred to as natural selection (an ontology, like the ball being drawn to the pins) that ensures survival of the species. He refers to a natural tendency--a risk ontology--that later becomes the natural right to self-determine, or self-governance, and later, the psychopathy that ensures the productive incentive necessary for the human species to survive against the odds.

To protect us from ourselves requires the rule of law and leadership, Ryan explains, not governance. Risk is not arbitrated on command but arbitraged on demand, freely enterprised so that we can be what we want to be by social contract (by consent), which cannot be determined by government (the Leviathan) lest we be corrupted, as Forbes describes it, being governed by "the collective" rather than led by the best and the brightest selected in the marketplace for their natural competence.

Ryan attributes natural right to nature and God, which gives it the existential value of supreme being (with the power to "create" jobs, for example) meaning that no one has the right to take it away. Objectively, no one can take it away, although people who want to govern try, and so Republicans vow to lead with naturally selected competence in the marketplace and not govern. Ruling by natural right--the right to self-determination--as Ayn Rand argues, is not an idealistic concept of the self, it is objective reality...our objective identity.

Psychopathy, for example, instead of being the measure of what we don't want to be, is a survival mechanism endowed by nature to be nurtured...cultured into a highly productive, economic environment, self-determined, fully functional, preventing us from becoming what we can never be?

Risk Deontology

Can we say the recent event in South Africa, where protesting miners were killed by police in self defense, occurred with moral authority, and if so, from what does that authority derive, or is it derivative at all? Is the event a predictable ontology with a categorical imperative or is it a teleological construction with an Objectivist, risk ontology that is apparent only when the event occurs at a particular time occupying a particular space?

These are not rhetorical questions or curious conundrums. Answering these questions in theory or in practice forms the philosophy of risk, which has real, measurable, technical value that determines the distribution of the reward and delimits the liability of the risk.

According to the Objectivist, morality is derivative value. (It is value with no absolute constancy, having as many values as there are observers, derived from all the probable circumstances they are in to form what is nothing but a random, objective, stochastic oscillation of the risk, forming clearly predictable patterns of probability in the aggregate.) It derives, as Nietzsche maintained, from the execution of power, which is the only thing that gives it constancy, much as Ayn Rand describes it. (In other words, technically, it has no added value. Technical data in the aggregate is devoid of subjective, moral sentiment because it does not really exist--it is not objective reality. The value we subjectively impart to moral sentiment results in unobjective, irrational behavior, which appears in the technicals as a predictable, algorithmic, objective ontology. When we provide welfare for the unemployed, for example, which technically presents as inflation with low productivity, Randians explain, we foolishly believe we are being morally responsible when, objectively, we are making the problem worse by destroying productive incentive. Rather than adding value it is really a loss in zero sum--what conservatives refer to as a moral hazard--because the economy loses the incentive to add supply that economically reduces the probability of the risk without all the confusing, relative ambivalence of political sentiment. The loss produces the violence, for example, that yields the value--the imperative--to kill protesting miners with moral authority. The deontology, according to the Objectivist, ontologically yields the risk to be avoided--that is, the value of the risk is always conserved in zero-sum, economically maintained to technically indicate error. The technicals, not moral sentiments, objectively indicate the right thing to do, demanding an economic solution derived from the individual rather than a collectivist, political solution--like the civil action taken in South Africa--derived from the state.) For a power elite, what is moral is whatever maintains power. So, as Socrates, Plato, and Aristotle pointed out, good people, ironically, are stuck with all the risk and bad people take all the reward.

Nietzche and Rand, however, fail to see the irony of good versus evil because the value of the risk is not morally derived from an imaginary world of ideas but derives from the real-world application of the risk. Morality is not integral to the good life but derives from the deontology of the risk--shaping it into whatever you want it to be on demand, not ontologically on command. Fascists, for example, who subscribe to Nietzsche's philosophy and maintain that the masses require a superman, or a super-ego, to direct them into the good life, much as Plato described it, fervently maintain power be legitimately structured on demand. Communists who want to maintain power on command are inimical to the individual freedom required to make demands in the marketplace and keep "the people" peacefully prosperous. As long as the non-elite have the freedom to prosper and advance in socio-economic class, by maintaining our natural inequality, the productivity required to get there on demand ensures the supply needed to actualize the good life that cannot be had without it being ontologically derived from those that have the power to execute it on demand in the marketplace. Once the capacity for leadership has been established to manage the risk, we are free to pursue the good life on demand with the power of self-determination, which is to describe an integral, ethical dimension (a deontology) where it objectively does not exist.

According to the objectivist, we are never where we want to be, and this lack of meaning, of arbitrary purpose always to be determined, is what gives meaning to an otherwise meaningless existence. Just look at the technicals. Everywhere we look is a fractal "sameness" of continuous oscillation. The only real meaning it has is the objective we give it, continuously oscillating between what we are and what we freely want to be.

Risk Management and Moral Authority

When South African civil authority opened fire on an apparently homicidal mass of miners protesting a subsistence wage against rising prices, which forces their income below subsistence, the authority to kill the miners, however objectively immoral it may be in the aggregate (in the abstract), is considered categorically imperative within the relative space (the circumstances) at the time (the observed occurrence of the risk).

Civil unrest is in the offing. Managing the risk requires civil action with moral authority--the utility of the greater good, which means we have to define just exactly what that is. More importantly, as Ayn Rand points out, for example, defining what the objective is demonstrates who has the executive power, and therefore the capacity, to decide what "the good" is.

The reaction of civil authority in South Africa demonstrates the greater good is protecting property from those who will loot the wealth of the nation with homicidal fervor. While few reactionaries would disagree with this hypothesis, the first rule of law (what is categorically imperative), according to Ayn Rand, for example, is to renounce violence (not because it is immoral exactly, but because it is sure to demand a command elite, with moral authority, that enslaves the individual to the state, which could include the current power elite who are identified by the stateists as the heavy). Reactionaries are likely to agree with Rand's imperative in principle (in the abstract) but are sure to pose the probability of the risk in practice, which effectively makes the victims (the miners--the looters--motivated with homicidal tendencies) the heavy.

Renouncing violence, it stands to reason, requires eliminating all the probable causes and Rand, for example, says the best way to do that is to let the best and the brightest emerge in the free market to satisfy themselves. Selfishness in a free-market environment cures both shortages and, thus, the motive to be violent unless, of course, the motive is to loot the wealth that has been legitimately earned in the market.

Despite all the selfishness that obtains to reduce the probability of the risk, we currently face shortages in a crisis (gamma-risk) proportion, prompting the President, for example, to propose a distribution from the SPR to reduce the risk. Remember, however, the risk cannot be reduced, but it can be avoided.

While the risk of loss is fully assumed in priority, the probability that it will occur at any particular time can be deontologized (like the President may do with the SPR to relieve the economic burden for the 99%, which, you see, also protects the 1% from themselves) by shifting it to the future. The ontology, existing in priority, however, means that the risk is likely to accumulate mass. If it is not deconsolidated, the mass becomes critically unstable, much like what we have now with civil authorities, having made enquiry, for example, into how dark markets operate to accumulate risk, standing by, prepared to deontologize the risk in the gamma dimension with moral authority.

Probability and Imperative

Determining what policies and programs fit our objectives is, as Paul Ryan points out, an intellectual endeavor. Much of that consideration is an ethical enquiry with a technical correlation that has probable value.

For example, the drought of 2012 is a detriment force majeure. The reduced supply increases prices and big profits will be made in the form of capital gains by "making the market more efficient" (RTV's like credit-default swaps and a panoply of other futures-contract devices that raise consumer prices and maintain a deflationary trend). Considering that the benefit is derived from the detriment (with added price increases reducing already beleaguered incomes supported by "headline risk" that efficiently destroys demand), we have to consider the moral value of turning the misery of others into the personal wealth of a small class called "the one percent."

Romney and Ryan argue that the value added from making markets more efficient (application of efficient-markets theory that allows risk to be accumulated and distributed in dark markets) is created from the destruction. What would otherwise be a dead-weight loss is managed into a capital gain that serves to peacefully distribute the scarcity (the risk of probable panic and civil disorder occupying "the headlines") with an on-demand, free-market legitimacy. So, technically, what is the value of the risk here?

Technically, the probability that an extreme drought will occur is 100%. The probability it will happen at any particular time is random, however, depending upon the capacity to read the signs that predict the event. Knowing that the detriment will occur with the prospect of profiting from it has moral value, and the knowledge of the probable detriment, keep in mind, appears in the technical oscillators that financiers use to quantify the probability of the risk.

The risk of loss is fully assumed. That is, the value (the financial reward) derived from the risk is equally imperative. So, Ayn Rand explains, for example, the risk-reward (the economic solution on demand) is devoid of moral value (it is purely ontological) because the cause and the effect is equally imperative (a rationale with which big bankers and their lawyers do whole heartedly agree, having a sense of complete objectivity that has, you see, the equivalent force, or legitimacy, of moral authority). This so-called "objective" valuation misprices the risk proportion.

When retirees see prices going up while the interest paid on their savings is going down (a reality achieved by technical objective), regardless of the technical reasons (the objective reality), the solution is politically motivated (positively charged with the legitimate force of a moral imperative that is evermore probable). While risk is not being added, dismissing the political risk as objectively irrational is to technically misprice the risk proportion to the reward.

Risk becomes disproportionate to reward because RTV's do not reduce risk. Instead, the risk accumulates into a political dimension--the gamma-risk dimension in which the probability is imperative.

Technical pursuit of objective reality misprices risk when it is ontologically assumed to be legitimately distributed with the reward when it has been actuarially avoided by objective. When the reward is quantumly gained in zero-sum, using RTV's, for example, the expected detriment is force majeure--it is categorically imperative, and if this imperative value is ignored, or avoided, the risk-value is mispriced and presents in a panic proportion.

Mispricing risk results in beta-risk volatility (remember, risk is not added but transformed) that eventually goes gamma (demanding a political resolution). The market is "made" to appear technically unpredictable--random and chaotic.

Up is down, down is up so that the "rational" (categorically imperative) thing to do is to make the market more efficient to achieve low entropic value with moral authority.

It is important to understand that the appearance of randomness exculpates the risk (see, for example, the force-majeure rationale regulators used to free MF Global executives of criminal liability). This legal limit to liability (premised on the ontology of large, complex, organizational technologies that the marketplace demands to be competitive) substitutes for the logic of collective action in the marketplace.

Stability is traded for instability to stabilize the risk, which is an insanity (a criminal insanity) that can only happen by decree. Ad-hoc rationality on demand that is relatively valued is traded for post-hoc rationales on command (by administrative-judicial decree) that have absolute value with the force and legitimacy of public authority.

When the marketplace is not "made" (consolidated) to be so-called "more efficient" but is allowed to operate unconsolidated, the risk is directly priced with empirical, imperative value that achieves verifiable accountability with moral authority.

Road to Serfdom or Path to Prosperity

The politics of demand destruction reduces to tax policy because paying taxes pays the economic rent.

Since the best way to have more of something is to tax it less (reduce the rent, which is what the kind did, and later the middle class who became rich like the king with the development of capitalism), if we want more millionaires, which indicates being on the path to prosperity, tax it less.

If we want to add supply, it is necessary to reduce the rent. No, this does not mean a broader and flatter distribution of income to demand the supply, which resists deflationary risk and rising rents. It means a broader and flatter tax burden against a zero-sum reduction of income for the lower classes, which regresses the tax burden, raises the rent (increases debt to demand the supply) and results in less productivity. It puts us on the road to serfdom described and explained as the path to prosperity.

According to efficient-markets theory, remember, we always encounter a detour along the path to prosperity. Debt increases to demand the supply. Margin compression occurs because a free market creates plenty of wealth but does not sustainably distribute it, which always puts us back on the road to serfdom.

Since capitalism considers redistribution of wealth to be a moral hazard because it reduces productive incentive, to cure recurrent crises of overproduction requires making the market more efficient.

(Keep in mind that the cure is a psychological trick utilizing the anchoring effect. Since the wealth does not trickle down enough to demand the supply, which results in oversupply at high prices, capitalists are quick to warn us that taxing the surplus will make it even less likely the wealth will trickle down. A more progressive tax rate is a hazard because it steals value and distributes it to people that did not earn it. Stealing is immoral, and this immoral act results in the hazard to be avoided--deflation. Thus, the moral hazard.

Avoiding the hazard is not a function of deconsolidation because consolidation is what makes the market more efficient, and raising the rent at the margin is as bad because it loots the value efficiently produced. Instead of adding the supply that cures the chronic shortages we had before capitalism, pillaging and plundering the wealth of nations like in days gone by deters the incentive to add supply. Financiers will not try and make markets more liquid and, hence, more expansive, but instead hord their cash like they are doing now, compressing the marginal product, causing shortages and rising prices.

Managing the risk with propriety requires the special understanding, the secret knowledge, needed to be a member of the ruling class, and its administrative bureaucracy ruled from the top down, both public and private. In order to not induce the risk being avoided, and make things worse, it is necessary to do the right thing and do the wrong thing no matter how immoral and hazardous it may be for the huddled masses in service--indebted--to their overlords, serving up the oversupply--the cure for shortages--on demand.)

Originally, during the Clinton administration, the market was made more efficient by progressing the tax code. The margin, instead of compressing into the hands of a few, wealthy plutocrats, was taxed so that it accumulated a budget surplus instead of debt on demand.

The Bush administration then returned the surplus to its "rightful owners" with tax cuts for the rich. The margin re-compressed in the private sector, but not to worry. A market that is deregulated--without deconsolidation because that reduces efficiency--self-corrects for abuses because a free market demands propriety, but without deconsolidation there is little or no incentive to correct without government intervention and the coercion that supposedly causes all our problems.

It is important to recognize that in both cases risk-value is kept consolidated for its "proper" management by elite, administrative authority both public and private, and consolidation of risk-value is exactly what a free market is not. The result of consolidation is, for example, being dependent on jobs "created" and compressed to expand the margin rather than demanded.

Without margin compression that occurs in small, disinflationary, non-catastrophic proportions on demand, we end up with one, big catastrophic, deflationary proportion that demands markets be commanded into efficiency. Instead of avoiding risk, we demand what we are supposedly trying to avoid--the need for big government.

It appears that free markets cannot, will not, work to sustainably distribute value. It appears that adding debt is the only way to demand the supply, and since adding debt is considered to be added risk, when it isn't, it appears that eliminating deficit spending with tax cuts will render free-market economics, when it won't.

Indications a free market doesn't exist doesn't mean it doesn't work. Just because the means for immediate accountability does not occupy political space with less and less need for government doesn't mean it can not. Quite the contrary. There is every indication that it works and so every attempt is made to avoid it.

By trying to avoid margin compression, which is unavoidable, we suffer free-market repression and a tax burden in regression to relieve our oppression.

At the forefront of a more regressive tax burden are Ivy-League advocates who say the reason big businesses are hording (repressing) record amounts of cash (capitalizing the distribution of rents needed to demand the supply, which increases the demand for debt) is because there is too much uncertainty over tax policy (who pays the rent). However, consolidation of value (who collects the rent) is all but uncertain--it has a deflationary effect with high debt and rising unemployment...just exactly what benefits the want-to-be gods of wealth and power to the detriment of everybody else. If unemployment does abate because the gods command they pay no taxes in order to distribute the accumulated value, that will be when the debt is paid, which destroys the demand necessary to resist the detriment--deflation--and demand propriety. This is called "rigging the market."

Relying on the theory of efficient markets, the capacity to demand propriety is highly improbable.

Being determined by events that cannot be foreseen or prevented, with matters virtually popping in and out of existence, risk management at the level of the individual can be highly probabilistic. At the macro-economic level, however, with the utility of efficient-markets theory and the tools of quantum mechanics, the probable direction of the risk can be made to move by creating distortions in the free space called the market with massive accumulations of the capital like never before.

With the invention of the calculus and harnessing god-like forces of nature, you would think we had interchanged the road to serfdom for the path to prosperity. The path is paved, however, with the capacity for complete self-destruction, and while we should be wise enough to construct a risk ontology that reduces the probability of the risk without going MAD, the road to ruin is paved with good intentions. You would think that with so much productive capacity (referred to by the "job creators" as "creative-destruction" that infers a god-like potential for exacting unacceptable amounts of harm if we do not avoid the moral hazards) we could not only cure shortages, but cure want in the shadow of death, which is what it means to say, with propriety, "I shall not want."

A massive distortion of market space is created over time by organizing to avoid the strong force of proprietary (alpha) risk, which cannot be avoided on command (as the king found out, for example) because its value derives from the risk on demand. With accumulation of this risk value (supposedly to make the market more efficient), the probability the vast majority will be able to resist the gravitational field of the capital and determine the direction of the risk is highly improbable at the quantum level despite being the stronger force. At the same time, while the powers that be (the "job creators," for example) think they have cleverly commanded nature and de-ontologized the risk with value at the quantum level, the relative value of the risk is fully maintained in the macro dimension with an ontology that is all but uncertain.

Although the weaker force ("job creators" being fewer in number, for example) dominates and directs traffic with gravitas, eventually we learn how to read the signs. "We" discover the path to prosperity, without self-determination in the alpha dimension, is really the road to serfdom.

Following directions that take us back to gain the future, we gravitate down the road to serfdom with the false ambition of gaining strength in fewer numbers. Gaining what cannot be simultaneously had in large numbers is not at all probable within the fabric of the free market, however, and when we try, the risk of loss is fully assumed.

Demand Destruction

Capitalism claims to be synonymous with a free market but also claims it is inefficient. To make the marketplace more efficient it is necessary to consolidate it. This is called efficient-markets theory and dominates our current, political environment.

Repeal of Glass-Steagall is the product of efficient-markets theory. Subsequently, having produced the Great Recession, the market is to be made more efficient with thousands of pages of legislative initiatives to make the market more efficient.

It is not difficult to figure out that the theory is a technical failure, but as previously discussed, this depends on what the objective technically is. If you recall, when Mr. Obama campaigned for president, too-big-to-fail banks were the problem, not the solution. Having succumb to efficient-markets theory at the behest of his Ivy-League colleagues, demand continues to decline despite record budget deficits and low interest rates.

During the Reagan-Bush era, by contrast, when we had trickle-down tax cuts like we've had for the past 10 years, Fed chairman Volker moved interest rates up to record levels to cover the booming deficit. Spending was not cut because tax cuts for the rich, contrary to trickle-down theory, did not destroy demand for government spending but added it. The theory was an empirical failure but was replaced with efficient-markets theory, which during the Clinton era culminated in repeal of Glass-Steagall.

An unconsolidated, free market is supposed to be self-correcting, avoiding systemic risk. Instead, using efficient-markets theory as the working model, the marketplace yields the accumulation of risk to be avoided. Industry and markets are too consolidated as per the economy-of-scale efficiency the theory says cures shortages by adding supply. Objectively, it turns out, supply is added by destroying demand, which adds demand for government.

The Fed, by objective, is currently keeping rates low--manipulating rates to resist demand destruction. That is not a bad thing except that the marketplace is too consolidated--the added supply of money is being used to support the price of equities against declining demand. The capital that drives (empowers) demand is being horded to secure a regressive tax burden that will cause the demand destruction (the deflationary risk) supposedly being avoided by objectives both public and private.

CEO's of big corporates, for example, operating with limited liability, insist that consolidation creates value, which in turn creates jobs. The opposite is true, however. Value is created with demand destruction--combination of unemployment and rising prices, which accumulates deflationary risk.

Big CEO's claim that by creating value (growth) they create demand (jobs), but growing a company (creating value) by consolidation (attaining economy-of-scale to make the market more efficient) is to the detriment of jobs. The capacity to demand jobs (and empower consumers with proprietary risk) is destroyed, not created, to add value (systemic risk) to the company. This is what is "twisted" about Fed policy. If big corporates, who we rely on to create jobs, destroy jobs to create them, the result is what we have now, stagflation--high prices and profits with high unemployment.

As long as unemployment remains high, the Fed tends to add new money to support demand (i.e., resist the declining rate of profit). Relying on the "job creators" to demand jobs from the top down turns them into gods to be supplicated. Growth requires sacrificing the capacity to demand it. The result is inorganic growth--merging and acquiring industries, markets, and proprietary risk to resist the declining rate of profit, financed by the Fed at low interest rates to support the demand for added supply.

With diminished capacity to demand the supply (demand destruction), supply is added and proprietary risk accumulates solely into the hands of the gods who falsely claim the result is the legitimate effect of the invisible hand. Supply-side advocates claim that collective action in the marketplace results in a beneficial detriment (naturally occurring risk in the aggregate referred to as "margin compression"), and since it results in detriment (stagflation), the marketplace needs to be made more efficient. Thus, the foundation of efficient-markets theory.

It is readily apparent that causing unemployment in order to effect job creation is irrational. (While it may be irrational to me, conservatives contend, it is only because I do not possess the secret knowledge of the elite. It is not so much that the knowledge is secret but that I am not capable of comprehending it. I am blinded by the light of empirical evidence that loses its truth value when elite status is achieved. Once I possess wealth and power I will understand, as Rand puts it, what objective reality is. I will be rational.) So, to rationally accommodate what is irrational, we have "Operation Twist" to de-compress the rate of interest (not deconsolidate it, mind you, because that would reduce the capacity to make the market more efficient...more rational). Technical inversion (decompressing the demand for yield that bids up supply instead of adding it) indicates consolidation of risk into the hands of a psychopathic elite drunk with god-like delusions of grandeur. These people, while operating with rhetoric that always suggests the benevolence of making the market more efficient, are interested in causing detriment. Not only does it create value for class consumption, but verifies status and creates a perverted, malevolent, sense of accomplishment referred to as "the American Dream" to which we all aspire--Dante's description of hell!

Understand that creating hell on earth is not irrational, it is a measure of creative competence scaled against probable destruction--the working concept of creative-destruction that Romney understands to be the strength of productive incentive, being dependent on the job creators rather than government. By always knowing evil we are always sure to measure with absolute certainty what is good, or rational.

When undocumented workers are locked into factories, working 80 hours a week to achieve Wal-Mart's price targets, factory owners are not being immoral, they are being rational. They do it because Wal-Mart will find somebody else that will, if they don't, on demand.

(Keep in mind that this problem is easily solved by ensuring the marketplace is deconsolidated in priority, with a bonus being less need for government and more freedom. The more deconsolidated, the more likely workers are able to secure propriety on demand. This deconsolidation of proprietary risk includes reversing the trend of falling incomes that creates the demand for ever-cheaper goods sold at Wal-Mart and feeds back into demand for impropriety. The less demand destruction there is, which forces consumers into Wal-Mart to consume a detriment that appears as an immediate benefit on demand, the harder it is to, in effect, demand slave labor in late order.)

Causing detriment is not the product of a psychopathic intellect. Instead, conservatives contend, it is intelligent management of nature's resources by design, pragmatically freed of moral conventions, maximizing efficiencies empirically measured with an expanding profit margin that clearly indicates the good life--the utility of adding value that would not otherwise exist. Turning natural resources into nature's bounty is not psycho--it is not selfish profiteering--it is utilitarian.

Look at the right-wing, reactionary description of "good" tax policy going forward, for example. It is a technical description that explains how supply-side economics works to maximize the utility of productive incentive, which is both indicated and achieved by driving up profits and driving down costs--the Bain Capital (corporate raider) and Wal-Mart (slave wage) models that, when combined, is more the road to serfdom than the path to prosperity.

Empirical Value and Collective Action

The twist component of a broader-and-flatter burden relates to collective action.

Capitalism tends to focus on the individual because the aggregate value of collective action in the marketplace demands empirically verifiable accountability. In a free market, propriety is measured with market share and the profit margin. A business that provides a product you demand but can't trust is likely to lose market share and suffer a declining rate of profit in the alpha dimension if the consumer has a choice on demand. The marketplace, with the risk of loss fully assumed on demand, is self-determined--fully empowered with pluralistic, deconsolidated, proprietary risk.

It is instructive here to compare the alpha decline with the declining rate of profit experienced in the gamma-risk dimension where risk is consolidated to avoid it.

The alpha presents non-catastrophic, disinflationary risk; the gamma presents a catastrophic, deflationary, systemic-risk proportion that "demands" government intervention.

When the risk goes gamma, government acts with collective authority to affirm the mal-distribution of wealth and power--the detriment to be consumed on command--as legitimately earned with risk in the free market. Collective action is used to scapegoat the liability--the detriment to be consumed on demand--and assumes the risk proportion in the form of a late-order effect with the force and legitimacy of "due" public "process."

The effect is a rising tax burden that Romney and Ryan claim must not be the burden of the "job creators." If we show impropriety and burden the creators, they will retribute the risk in the form of deflation.

To appease the gods of wealth and power, we must be sure and not tax them to minimize the risk of deflation--the declining rate of profit (the retribution) it will surely cause. When the decline occurs (the risk of loss is fully assumed), we apparently have not provided proper tribute. The tax rate, according to the best and the brightest, is not regressive enough--not enough tribute (sacrifice, or detriment in the form of austerity) has been paid to the creators.

Empirically, then, given the evidence of a declining rate of profit, it is unnatural to tax the creators of wealth and power, which we are sure to do in order to keep the capital cycling into accumulation. When the capital fails to recycle, the eternal hope and promise of being on the path to prosperity ends, along with capitalism.

Eventually, along the "Path to Prosperity," the burden becomes evermore regressive--working for free while paying off student loans, for example, which accumulates even more value to be retributed (and collectively consumed, which adds demand for government) in the form of systemic risk. Yes, indeed, objective reality will most assuredly assert itself, and empirically verify our self-determination, despite the perception of it.

(It is important to understand that added demand for government does not add risk. This is a technical error that twists policy analyses into the objective of "risk reduction."

By trying to reduce added risk, programs become a complex mass of temporal fallacies that naturally result in failed expectations. Failure is then corrected for by adding to the complexity, not the risk.

When technical failure occurs, it is not because risk is added, but ignored in the aggregate, having been transformed into a gamma-risk dimension where legitimacy is a function of collective action in a politically post-hoc proportion.

The quantity valued as "risk" is always coefficiently conserved despite that the reward, by hook or by crook, can be added. Accumulated wealth, and power structured to increase the reward with low risk, accumulates risk, it does not add it.

Added value does not have to include added risk. In a free-market, the risk taken is non-catastrophically coefficient with the reward. Value can be added non-zero-sum with a deconsolidated distribution of the risk proportion.

With the quantum "risk" conserved in a non-catastrophic, unconsolidated, alpha-risk dimension, reward is driven by the incentive to innovate and expand the economy to make a profit.)

In the gamma-risk dimension, the empirical value of collective action is consumed in the form of false inductions. A progressive tax burden, for example, is attributed to supporting deflationary risk when it actually resists it, and while government distributions of accumulated wealth keeps capitalism from collapsing into Randian nihilism, government intervention is really the effect, not the cause, of the accumulation and the declining rate of profit.

Technically, with all manner of false induction, policies and programs, public and private, are an inchoate mass of errors that predictably fail expected, normative values like supply-demand and risk-reward. When supply exceeds demand and prices continue to rise, and reward is higher with lower risk, the economy-of-scale efficiency required to achieve these unnatural results are described as "the new normal."

By consolidating the means of propriety and the empirical value of collective self-determination, we induce the risk being avoided.

To avoid proprietary risk (not reduce it), capitalism claims to conserve the value of self-determination while, at the same time, destroying the power to demand it. Destroying demand is counter-intuitive if we "normally" want to make a profit, but modeled with an economy-of-scale efficiency it proportionally increases the power to command the margin by consolidating the marketplace in the name of reducing risk.

(Risk avoidance is not risk reduction. This is a technical error. When Goldman Sachs models to hedge macro risk while Bank of America redlines homes into foreclosure, credit-default-swaps are not a hedge but a profit-making vehicle that derives value from detriment in a systemic, synthetically aggregated proportion. Although it may seem that profiting from the misery of others lacks propriety, what are you going to do about it?

Remember, what is synthetic about the aggregate is the value "created," not the risk. The benefit is derived from the loss, not created--the risk of loss is fully assumed in priority. It is a false benefit that accumulates retributive value in the aggregate, which is empirical value used to synthesize an ontological argument that values the risk as collective action in the marketplace.

Since the aggregate--the sum of the squares--is where the ontological truth resides, from which derives the axiom that the technicals never lie, the truth can nevertheless be synthesized. Truth can be technically manipulated, like when Barklays manipulates the LIBOR.

Lies are derived from the truth. When a bank manipulates rates it produces a technical benefit, but in the aggregate the risk of loss is fully assumed. So, who trusts Barklays to do the right thing with all that accumulated capital anyway?

By allowing banks to be so big they can manipulate the technicals and move markets to produce a surprise premium--which is a surprise only to those who consume the detriment--we are, supposedly, reducing risk with an economy-of-scale efficiency. Remember, "In God We Trust." The trust will be accounted for in the aggregate according to free-market theory, but according to efficient-markets theory markets need to be consolidated to reduce the risk of a declining rate of profit.)

The risk is not reduced. In fact, it is accumulated into the risk being avoided, which accumulates more risk. While Ivy-League, business school graduates consider this to be a clever means of commanding detriment with the appearance of being on demand, it is, in objective reality, a technical failure that demands a political resolution--collective action.

By means of demand destruction (the slow demand we have now, for example), consolidation of capital is supposed to make us more competitive by achieving economy-of-scale efficiency, but it really reduces competition and proprietary risk. It reduces detriment that consumers otherwise exact on the so-called "best and the brightest" in the marketplace, unconsolidated, on demand.

(Capitalists tend to question the value of moral intelligence. They tend to the philosophy of Ayn Rand, for example, in which intelligence is merely a function of taking and keeping power in a free market. Morality is a function of controlling relative value on command, not on demand.

A philosophy of risk that discounts moral intelligence is exactly what the capitalist is looking for, relying on the ontology of the outcome to guide our sense of morality, technically demonstrated in the aggregate. The ontology--objective reality--is not something that can be changed, nor should we try, but just let it be.

While exacting detriment in zero-sum is relatively easy, maintaining dominance in a free market without consolidating the risk requires more intelligence than the so-called best and the brightest have on command. Instead of expanding the economy, and the capacity to self-determine, they spend a lot of energy "creating" a false ontology that excludes the value of moral intelligence, subscribing to Rand's Objectivism, for example. Creating value non-zero-sum requires the incentive--the risk--of moral intelligence on demand.

In a free market there is more to be accounted for than just the self. It requires a level of moral intelligence that efficient-markets theory unintelligently assumes in the aggregate with a post-hoc lack of priority.)

Demand is value that empirically measures the available amount of affective, collective action (retributive value) that determines the probable direction of the risk. While capitalism considers the capacity for exacting detriment on demand to be clever, having to produce a profit with full, market accountability requires a level of intellectual capacity that the best and brightest endeavor to avoid in order to survive.

When capital and markets are unconsolidated, and a free market occupies political space in an economic, alpha dimension, the best and the brightest are determined on demand. According to elite, conservative theory, however, like that of Alexander Hamilton (to which both liberals and conservatives subscribe), turning the power structure on its head is the recipe for political-economic dystopia. (See, for example, the philosophy of Thomas Hobbes and Edmund Burke.)

In order to be self-determined (like the king), the elite must destroy the capacity to demand propriety. This means, contrary to our American heritage, defeating the free-market mechanism (and embracing a philosophy such as Ayn Rand's Objectivism, for example), and when the critique of capitalism is that the technicals indicate it is operating without a free-market legitimacy, the critics are axiomatically declared to be communists seeking to destroy the soul of our individuality, but consider what it means to destroy demand.

Broader and Flatter...With a Twist

Tax reform sounds great. It is the perfect plank for political succession promising an economy that is the picture of health...broader, flatter, leaner and meaner, but with a twist.

Broadening the burden and flattening the tax rate is the path to prosperity because, according to Romney and Ryan, it encourages us all to become rich and self-determined. In other words, to avoid being taxed it is necessary to be productive, but there's a twist. It is necessary, for example, to increase productivity with fewer employees, which will increase the capacity for self-determination by reducing it for others who are then taxed because they are not productive.

Right-wing conservatives claim we have a public debt that exceeds aggregate productivity because the top income class pays most of the income tax. The solution, then, they say, is to increase the burden for 99 percent of incomes in decline and reduce it for 1 percent of incomes rising in zero-sum.

According to conservative philosophy, the zero-sum increases productivity. Distribution of value in zero-sum (the 40 percent lost so far with the Great Recession, for example) provides the incentive for a net gain (the nearly 300 percent gain for the upper class). It "creates" more value than put into it. That is, the zero-sum incentive adds value that does not otherwise exist, but instead of adding value what is really added is an accumulation of risk that would not otherwise exist. This is what conservatives call "supply-side economics."

(It is important to understand that a free market keeps risk diffused. Risk is safely and soundly fully assumed and consumed ad hoc in non-catastrophic, unconsolidated proportions. It operates with a pluralistic model that is technically confirmed with unaccumulated risk, exactly the opposite of what we have now in a too-big-to-fail proportion that demands complex regulatory authority to keep the risk from deconsolidating.

The risk of loss is fully assumed but can be transformed and consumed in a catastrophic proportion. When risk gains a systemic proportion--when it goes gamma--a free market is not being allowed to operate and attempts to describe and explain the distribution of risk-reward as the product of free-market mechanics, post hoc, is a fraud, fully indicated by the technicals.)

Creating value that does not otherwise exist is the virtue of capitalism, conservatives contend, and react strongly to criticism that claims it creates more problems than it solves in zero-sum. There is truth to both positions. Capitalism, for example, increases productivity exponentially, but as the critique maintains, productivity that consumers can't afford to buy, and starving in the streets amid plenty, is hardly an improvement, providing the incentive for collective action (class warfare). To reduce the tendency for warfare (not increase it as conservatives contend) we have liberal policies and programs to conserve (correct for and retrace the value of) the elite hypothesis. The incentive to collectively act is coopted, bureaucratically structured to routinely task the externalities so the risk never goes fully gamma with the application of an elitist model.

When the externalities become too austere and counter-productive, we have the liberal alternative to the much-needed, trickle-down economic incentive that produces the slow GDP and high unemployment we have now. While it should be clear that neither really solves the problem, but retraces it, we keep doing the same thing over and over in impulsive and corrective waves, both long and short, which has a psychological, anchoring effect. The implication (the phenomenological effect) is that it can't get any better than what we have, which supports the hypothesis that history ends with capitalism.

The austerity required to cure shortages and increase productive incentive is, as we all know, premised on the trickle-down hypothesis. While it is continuously disconfirmed in the aggregate (the formula essentially being, give a little and take a lot long term), trickle-down theory still dominates the economic and political landscape.

Analyses of trickle-down economics seems cliche' at this point in history, but it is the essential principle for providing productive incentive. Capitalism claims that we will not be productive, but live like uncivilized animals locked in brutal conflict over scarcity, if we are not provided the organized incentive, the civility, to continuously add supply.

Capitalists claim they are not brutal bandits but benevolent beneficiaries of an economy that is always innovating new ways to improve the quality of life for everyone. The quality of life improves and people become more civil (or more demanding, which is a risk that is controlled by causing detriment that reduces demand) because we all want to get rich and be self-determined (like the king). Class mobility (which is as much a functional fear of non-conformity) provides productive incentive that is dependant on the amount of wealth (the detriment) that trickles-down, or distributes, to allow for self-determination on demand.

Trickle-down economics is a political scheme in the guise of economic necessity. It is not about adding supply but controlling demand.

The twist is that the more conforming, or dependant on civil authority whether public or private, the more self-determined we supposedly are, which results in cognitive dissonance. This kind of psychological disorder expresses as the binomialism that keeps our political system anchored to a relative benefit provided by the incentive to produce the relative value of the detriment. The value of the benefit is dependant on the severity of the detriment.

For the vast majority (the non-elite) there is a significant dependancy that capitalism refers to as "economic incentive," which is as much a political as an economic function. As history unfolds, the majority realizes that the self is determined by a few want-to-be kings (plutocrats) and the incentive to support the elite is fundamentally compromised with a false attribution that must be applied with the force and legitimacy of public authority.

With the illusion of progress on demand, we toggle between liberal and conservative reactions. Both parties propose and apply solutions to problems created by the other party's policy program. By continuously reinventing the problem, power is conserved in the name of continuous improvement, typically in the form of regulation and deregulation. The solution to the welfare state (the capacity to demand the oversupply and cause the need for employment to cure shortages) is trickle-down economics, and the cure for the austerity that commands it is the welfare state so that the problem, rather than the solution (free-market economics ensured by the state in priority), is always in demand.

When combined with the Laffer curve (now referred to as "The Pledge" to not increase taxes), supply-side economics is supposed to balance the budget with the added value (which cannot be taxed without causing slow productivity, like we have now, with record budget deficits). As Reagan found out, for example, the budget doesn't balance and the deficit deepens.

The broader-based income the Laffer curve demands be taxed is in decline while the value added goes untaxed, which accounts for the added supply (overproduction). Instead of being a general benefit, the added supply is transformed into a categorical detriment for "mass" consumption. Risk gains an unavoidable, aggregate, systemic proportion, and the economy is a whole lot leaner and a whole lot meaner, which accounts for big government spending while revenues decline.

What increases with the Romney-Ryan plan is not jobs. Instead, prices rise against declining demand (a detriment is exacted in the form of a proposed benefit), and because supply is added with fewer workers at lower cost on demand (the new normal), deflation, not jobs, occurs "on demand." The added supply appears to indicate the economy is more productive when it really isn't (i.e., productivity per worker rises while capacity to demand the supply--income--is falling with the result being low GDP, or slow aggregate demand). The result is technical failure and the Fed responds with something like "Operation Twist" (selling short-term debt to buy long-term debt) to increase the demand for productivity that pays the debt.

More demand for long debt (supported with a higher price) reduces the long-term rate to create a yield inversion that indicates the risk to be avoided--deflation (fewer jobs and declining demand). Capital will then move into the higher rate to deflate speculative demand in speculative markets (since it really isn't being used to add supply), reducing the price of oil, for example, which will indicate a recovery on demand.

The inversion--the twist--is the new normal. It now signals recovery, but conserved in historical perspective, in a twisted way, still technically indicates a deflationary trend.

Ending the stagflationary trend with a "Twist" provides more money to demand jobs and pay the debt, but demand will be diminished to pay the debt, especially when applied with a broader tax burden. The twist is that recovery means applying the austerity conservatives say is in demand to create jobs.

Again, understand, jobs are not created, they are demanded. The concept of the "job creators" is a lot of pretentious hokum. It is a psychotic delusion constructed into objective reality with practical theories, like supply-side theory, the Laffer curve, and efficient-markets theory (repeal of Glass-Steagall) that technically fail. These elite hypotheses are hokum to poke 'em. They are designed and implemented to technically achieve (confirm) what we have now--stagflation with the solution being deflation by popular demand. Deflation occurs with the force and legitimacy of the popular vote--fifty-plus-one and the vast majority are bust on demand with repeated command performances.

Performances include, for example, the song and dance over class warfare--a perennial command performance in which the king asserts that all he possesses belongs to everyone collectively. Demand is "collected" (horded) for safe keeping (horded to prevent shortages and hedge the risk). For those who applaud his performance, all the wealth is consumed, and those who would divide the kingdom naturally possess all the risk. All those who know the wisdom of the king will surely share in the wealth created in his name and held in common (job creation on demand).

As we know, however, the king's concept of common wealth became the concept of the "commonwealth" but with the pretense of kingly aspiration conserved in historical perspective. Capitalists are sure that history ends with its regime of power because it is more pluralistic, but as it was with the king, power consolidates to maintain alpha dominance, and because having more power than everyone else is not enough, power is tested by exacting detriment to demonstrate its extent.

Competition among elites can be extremely brutal for the non-elite who must consume the detriment because it is more likely a test for pain rather than pleasure. Real test of power is not getting people to do things they want, but what they don't want, like being austere in a consumer society. When once the consumption occured on command, detriment is now exacted with more elegance on demand so that its consumption appears to be the product of popular consent, self-determined and ontologically derived by collective action in a free and open marketplace.

Today, the test of tolerance is more likely to be in the form of a burden described as broader and flatter...with a twist.

Synthetic Risk

No such thing, and a model constructed to simulate synthetic risk will technically fail because it does not model objective reality. It models a psychotic delusion of the self--that you are so powerful you can create something out of nothing.

Risk cannot be synthesized (but it can be mispriced). It exists in priority and presents on demand (being undervalued to create an overvalued effect). Creating CDS's with the self-delusional concept of creating risk is to demand it with the technical objective of not consuming it yourself but timing it to transfer to others in the form of detriment. The value, in the aggregate, despite the delusion of grandeur (of being too big to fail), is self-retributive and not too bright.

What Jamie Dimon and JP Morgan's risk modelers didn't know, despite being the smartest people in the room, is that fractal, risk modeling does not create risk (nor does it spread the risk, which is what they say they are doing to everyone's benefit), it accumulates risk. What is created is a too-big-to-fail, economy-of-scale proportion that is more likely to fail the larger it gets.

We have to keep in mind that avoiding the too-big-to-fail dimension with a discussion about firms that are "too complex and interconnected to fail" is really the same thing. The risk that catastrophically accumulates, which is why Dimon is under scrutiny, is the result of over-consolidation, which undervalues the risk and means the solution is deconsolidation--exactly what controlling authorities both public and private fail to talk about because it is the risk that is really being avoided.

As I keep pointing out, again and again, trying to avoid the fully assumed risk by synthesizing it for someone else is self-retributive. Hedging risk for profit in the name of protecting your firm from the risk of loss is pure nonsense. The hedge is then the risk to be avoided--stupid!

The problem here is that the so-called best and the brightest are not the smartest people in the room...they are the dumbest! The reality of their superiority is completely synthetic and results in real risk to be consumed on demand by both "us" and "them."

Deconsolidation will keep risk properly valued--it will keep it from being arbitraged and mistakenly considered to be added, or created, by avoiding it.

Deregulation, which is the substitute for deconsolidation, is what led to the Great Recession. It is also the policy program posited by Romney, along with the austerity program of Ryan, to price the risk, and the price will be essentially set by manipulating the tax code in the name of much-needed reform to "reduce" the risk of job "creators."

Remember, however, risk cannot be "reduced" and jobs are not "created" but produced on demand--proprietary value that Romney and Ryan want to tax and cut with a broader burden and a flatter rate.

Technical Success (Deflation On Demand)

Technical failure since '08 has been a technical success. Forcing trillions of dollars into default and consolidating the value on demand is the American dream. Even the king couldn't exact massive detriment like that. Not on demand. He could never get away with that. He had to command it.

Indeed, as Reagan described it, "America is a place where a person can still get rich."

A place where you can get rich at the expense of others and get away with it--indeed, a place where causing massive misery is regarded as the virtue of high intelligence, morally imperative, and the success we all dream of (on demand)--is truly exceptional. It is, as Romney and Ryan explain it, the land of opportunity, which is curiously, at this point, being attributed to Obama's failure, as economist Paul Krugman points out, so that Republican policies and programs continue to be a technical success.

Stagflation is the natural result of consolidation "on demand" (i.e., considered to be the most efficient, risk-averse way to manage markets toward optimal productivity) whether it is the Romney-Ryan plan or the Obama plan. Either way, debt is monetized to consume the supply and resist unemployment with the result being, however, rising prices, which supports unemployment and is a technical failure depending on the objective. New money is added that is mistaken for added risk because it is being used to support profits (on demand) against overproduction in dark, speculative markets--swapping debt instruments that eventually commands default and demands the bailout Dodd-Frank is supposed to prevent.

Mistaking added money for added risk is not fundamental error, like falsely arguing high oil prices are supported by demand when demand is falling. That is just fraud and racketeering perpetrated by a bunch of gangsters who control our economy to profit by causing massive detriment (deflation) in the name of free-market economics (on demand). While expansion is the expected value of inflation, the actual value has been deflation. That does not mean risk has been added, but misdirected (timed and transferred) to redefine the probable value of the detriment. It is not a technical failure, but successful application of the risk assessment.

Failure of the risk assessment is a technical failure that derives from fundamental attribution error. While it is correct to say that the technicals are independent of timing, and so they never lie in the aggregate, the proportion of the risk and the relative space it occupies at any particular time (in the alpha, beta, or gamma-risk dimensions) can be, and is, often misconstrued, resulting in technical failure.

It is important to understand that risk cannot be created or destroyed. Its value is fully assumed in priority and consumed on demand. Whether we like it or not, risk cannot be reduced, but it can be accumulated and distributed--timed to transfer with what appears to be an unavoidable aggregate that must be managed on command to demand the supply.

The value to be demanded (retributed) presents as empirical value--the rate of taxation. As the value demanded accumulates (surplus value) the tax rate increases, and if the burden is regressive, the more value there is to be demanded (overproduction).

Reversal of a stagflationary trend--with stagflation regarded as a phase transition by most economists--is technically indicated by a rising rate of taxation. The period of stagflation following the oil shock in the 70's, for example, increased pressure to raise the marginal rate. Although resisted by the Reagan administration, the marginal rate rose, nevertheless, to reduce budget deficits, and later, during the Bush and Clinton administrations, the marginal rate rose even more to end the stagflationary phase, which transitioned into a boom phase of the business cycle, yielding budget surpluses that resisted a declining rate of profit.

In the current environment, as the rate of taxation rises--with more than ten years of an effectively regressive tax burden and even more to come if Romney and Ryan have their way--the rate of profit will decline, and resisting the declining rate of profit is job one. When there is no one left to pay the debt but the top quintile of income classification, the economic trend will reverse to pay the rent--what a Romney campaign slogan describes as "Putting Jobs First."

Failure to support the profit margin with a declining, marginal rate of taxation is, by natural condition, a technical success because it empowers more consumers with more discretion to spend. Stagflation ends, keeping in mind that a declining, non-marginal rate will support profits just fine, but without all the detriment like the "fiscal cliff" we now face. Resisting a declining, marginal rate prevents us from burying ourselves in detriment in the name of self-interest, which according to Romney and Ryan is a technical failure.

Technical failure and success is a function of working/analytical modeling. Constructing a model to legitimize the outcome, post hoc, as a technical success is not intended to have predictive utility.

Analyses used to predict economic trending is probably wrong not because it is in the aggregate random and unpredictable, but because it is intended to misdirect market participants into affirming adverse possession of the risk. This can be easily accomplished by moving markets contrary to technically indicated trends, which is a manipulation that can only be accomplished with a highly consolidated capital that operates with the effect of concentrated power--exactly what a free market is not!

Models not intended to be confirmational, but affirmational, are prone to technical failure. Not only are they not intended to be predictive, but because they are intended to confirm class identity with empirical value, the aggregate value consumed is ingeniously modeled to appear as value ontologically derived. This false ontology is the gamma-risk proportion--it is highly unstable and predictably catastrophic.

A predictive model is likely to operate as an independent, objective reality. The Romney-Ryan plan, for example, is supposed to be the path to prosperity, and predictably it is for the top-income classification. Since the evidence is verifiably positive by confirming a verifiable detriment for everybody else, the detriment is modeled as a naturally occurring, objective reality, a la Ayn Rand, in the aggregate. The outcome is commanded by nature, and so it is foolish--"intellectually lazy" as Ryan describes it--to resist it on demand. It is in this way that technical failure is modeled as technical success, and why we keep making the same mistakes, like regressing the tax burden to make the people that pay it more prosperous, over and over again.

One sure measure of success is the rate of taxation. A regressive tax burden indicates technical success if you want to be king (and technically conserves the power to stay king) since the king exacts the burden and subjects pay it. Keep in mind as well, the higher the burden (the more austerity exacted on demand to pay the debt--what the king referred to as extension of the rent), the more power technically indicated.

For a power elite, the closer the economy is to technical failure, the closer we are to technical success in the name of much-needed austerity to pay our debts and keep the king(s) (the "job creators") fully liquid and in command. The more failure (the more capital invested in credit-default swaps, for example, to extend the rent), the more success to be derived.

Today, rent is extended by consolidation of capital, which is described as free-market efficiency. Using the "demand" dimension of the marketplace, deflation (reduction of net worth, a 40 percent reduction for 99 percent of Americans as the result of the Great Recession, for example) occurs with an on-demand legitimacy and permutations of popular rule by elite authority.

Whether the objective reality is considered to be capitalist, socialist, or communist, consolidation of power (value attributed to the king in the form of taxation) is considered to be the most efficient way to limit the risk, paradoxically, by accumulating it (value to be retributed). The king (government authority) is not rendered less powerful by an accumulation of capital, but more powerful. Is this a technical failure or a technical success?

While capitalism has pluralized the possible number of would-be rulers who supposedly operate with more productive efficiency with less government, why is there so much demand for government, and higher taxes?

Limited government, remember, technically indicates a working, pluralistic model. Limited government on command does not cause freedom, it is the measurable effect on demand.

Lowering the marginal rate on command, like Romney and Ryan propose, will not reduce the demand for higher taxes. Instead, demand to tax will increase while the supply to meet demand (high profits supported by monetized debt) accumulates at the margin. The marginal rate, then, will naturally rise to meet demand. The risk of loss is fully assumed on demand despite all attempts to broaden the base and flatten the rate on command.

Since the Romney-Ryan plan is technically doomed to fail, it is necessary to invoke Rand's Aristotelian philosophy of risk. It is the latest version of conservative philosophy that posits the poor are too rich and the rich too poor because the tax rate is too progressive.

A lower marginal rate, according to conservative philosophy, makes us more productive, in fact, so productive that we have more supply, like housing, than we can demand, and the cure for that is, curiously, to be more productive.

Building more houses that consumers can't afford to buy is not the objective reality of curing shortages, understand, but deflation on demand. What is "produced" is the crisis of liquidity that private equity capitalizes on, demanding the rate of taxation be regressed to conserve the value derived from the detriment.

Voters need to understand that complex credit instruments swapped in derivatives markets are intended to deflate the economy on demand. It is a highly technical endeavor intended to make markets technically appear to be in control of our fate "on demand" by legitimate means of self-determination.

Swapping credit for risk-value in capital markets in the form of credit-default swaps, however, is not something the vast majority of voters are directly involved in. Technically, "We" are not in a position to determine the value derived in the image of the "self" as our founders envisioned it, but instead "We" are being positioned to consume the risk on command authority in the guise of the general welfare.

Securing the general welfare means controlling the macro-risk proportion--crises in the aggregate realm of technical analayses in which only the so-called "best and the brightest" are capable of managing into technical failure. The rest of us, about 99 percent of us, don't have the technical knowledge to manage the risk, and when it is a technical failure, "We" are too stupid and ignorant--or as Ryan describes it, "intellectually lazy"--to understand it for the success it really is in the realm of objective reality.

Romney and Ryan are prepared, I understand, to turn technical failure into technical success, but only if "We" let them.

Technical Failure

Labor has been working more for less because productivity has been gained with fewer workers. The derivative is consolidated income (value "lost") needed to demand the supply.

The value derived (the detriment exacted) has created our too-big-to-fail banks that the President says we need to provide capital world wide even after demonstrating derivative practices that still threaten global economic stability. Both the Obama administration and Congress support the accumulation of risk (value fully intended to be "lost") that comes with the use of efficient-markets theory.

Support for the theory predicts technical failure. The administration wrongly thinks bigger is better, explaining that unemployment is best reduced by eliminating subsidies that export jobs and import low-wage goods, which explains why regulatory authority has not been used to curtail speculative demand in futures markets (because it provides capital world wide to demand cheap labor) and why prices continue to rise against declining demand. Demand is so slack that even low-wage goods are becoming unaffordable, however, and the Chinese experience what it means to be capitalist--the crisis of overproduction.

When goods and services can't be bought at any price because income is too consolidated from exporting jobs (reducing demand against rising prices), reducing subsidies that support the export of labor value assumes the export will be reduced enough to increase demand. Instead, what will happen, because income is so consolidated, prices will be pushed up in speculative markets with the anticipated demand, which will reduce demand against rising prices.

By technical objective, high prices against a rising supply stagflates the economy (the problem to be solved in the aggregate) to resist the declining rate of profit. Paradoxically, when capital is allowed to consolidate into a too-big-to-fail (gamma-risk), aggregate proportion to resist deflation (a declining rate of profit), the more support the problem to be solved gets.

The more the fully assumed risk of loss (the alpha risk) is resisted and accumulated, the more probable it will occur in a gamma-risk proportion, and this catastrophic accumulation of risk is technically indicated by an accumulating supply against rising prices. (Notice it was just the opposite for consumers in the USSR. Shortages occurred against low prices with the result being an accumulation of political, gamma risk. Notice that in both cases alpha risk has been allowed to consolidate in order to avoid the direct accountability of free-market economics that requires less need--less demand--for government.) The result is high inflation and unemployment--the problem we have now.

Reducing the problem of overproduction to job-export subsidies lacks good analytical skill. We have these subsidies because power is too consolidated to resist it, and this power derives from consolidating capital into a too-big-to-fail proportion. Again, the problem is not that value is surplussed to avoid shortages, the problem is that the value is consolidated as productivity rises. The "change we really need" is resistance to consolidation, not support, and the problem expresses at the micro as well as the macro level.

Economists tend to ignore macro risk because "it just happens" as the result of micro-risk assessments. Objectively, however, macro risk is ignored because it is the primary means of exacting the detriment.

Risk is micro managed into a macro-risk proportion to, supposedly, avoid it. The result, however, is the crisis of overproduction, which is nonsensically attributed to low productivity and why analyses technically fail on a regular basis.

Macro risk is considered largely a function of probability. Since it is not a risk proportion that we can predict or control (time and transfer in the aggregate), it is a function of statistical probability that essentially measures the level of our ignorance. What we cannot know is attributed to randomness which, of course, explains the frequency of technical failure and the "surprise" reversals that, despite being ignored, are anticipated well in advance to produce value (accumulated wealth and power) from the detriment.

Since, remember, random events are by definition beyond our means of technical direction, the outcome is non-retributive (non-anthropogenic). The best we can do is analyze micro events, but that does not necessarily indicate the probable risk in the aggregate like when we consolidate the risk to efficiently manage markets to hedge the macro risk.

Instead of being reinvested to support the capacity to demand the supply, consolidation of capital (storing value to prevent shortages and the large-scale, macro risk associated with it) is used, for example, to parabolically over-price shares of facebook's IPO on demand. Technically, this "makes" a few people exceedingly rich with "new money" to demonstrate that capitalism really does work in the face of rising prices and slow, consumer demand.

Interesting that facebook's value is priced on a service consumers don't have to pay to use. If it was, the demand would not exist to support the price because it has been systematically disintegrated and the value derived consolidated into a volatile risk dimension that demands the value by fiat, not by the invisible hand of aggregated, collective, consumer power on demand.

Collective power on demand is akin to communism. It is the opposite of capitalism, so we have to be sure to ignore aggregate, collective power (the alpha-risk dimension of the invisible hand) and focus on the power of the individual hand.

Capitalism focuses on the entrepreneur that consolidates power and elegantly traps liquidity (the power to collectively self-determine) in dark markets in the guise of the invisible hand (i.e., with the constant perpetration of a fraud). A demand legitimacy operating within the command dimension is the gamma risk--it is the opposite of a free market, relying on government intervention to manage the aggregation of risk post hoc, which is then falsely reasoned to be the cause of the aggregate detriment that is really the natural effect (the empirically verifiable result) of the value accumulated.

Attributing risk to value accumulated on demand in a command dimension is fundamentally unstable and requires the force and legitimacy of public authority. The attribution transforms alpha risk into gamma risk by technical objective, and because of the inherent contradiction, whether capitalist or communist (destroying freedom in order to have it or conserve it), the working model will technically fail in the aggregate when the risk goes fully gamma.

(Understand that the gamma risk is more than just policy uncertainty that results from government intervention. The gamma dimension is where the fully assumed risk of loss occurs. It is not a probability, it is a sure thing that capitalism wants to ignore with the attribution of inculpable, aggregated value. The value, however, is fully culpable, and ignoring it is, technically, what accumulates the alpha into a gamma-risk dimension.)

Disintegration of the productive value (labor's integral value to the formation of the capital invested that is not retributed) presents as systemic risk that economists say we cannot control, and so it is always out of control, which demands markets be efficiently managed, post hoc, to control the externalities. Systemic risk (the aggregate sum of micro motives liberally pursued) is described as a naturally occurring, free-market phenomenon that is not caused by making markets, but markets are made, instead, to control, or efficiently manage, the effect (risk that accumulates with disintegration of the value). Objectively, then, the macro trend is stagflationary because productivity is high against declining demand.

High productivity against falling demand yields the objective value of unemployment. This value is consolidated to form the systemic risk (high profits against a slow economy) that modern economics technically considers to be, in the aggregate, ontologically derived.

Technically, the value consolidated is not derived, however. It is integral value that has been dis-integrated (destroyed) to yield (create) the value consolidated by technical objective. It is the creative-destruction that Romney, Ryan, and Rand describe as our natural condition, and so not resisting it is categorically imperative because nature demands it whether we like it or not. Letting too-big-to-fail firms like GM fail is the right thing to do because it consolidates the risk proportion to be efficiently managed.

Private equity firms, and banks that are too big to fail, reactionaries generally agree, are not immoral monsters feeding on the misery of others. The capital accumulated turns the detriment into surplus value--it turns the loss into profit, which resists shortages, but not with a disinflationary trend that would reduce the supply and increase productive incentive. Instead, the resistance is in the form of an inflationary trend (oversupply at high prices) that has a deflationary, macro effect that we tend to ignore (because we, supposedly, can't control it) until the numbers verify it, like we have now.

Currently, for example, we have a sharp correction in oil prices because it is overproduced at the relative price, but according to mainstream, market analysts, the price is falling because the dollar is rising against the Euro. While weak demand at high prices will account for the correction to the penny, analysts will not admit to overproduction being the problem with the result being technical failure and a stagflationary economy ad infinitum.

(If you recall, back in '09 after oil crashed to around $40 per barrel under deflationary pressure, and the Fed pumped in a load of money to resist the declining rate of profit, pop, technical analysis touted a rising oil price as a signal for economic recovery. Of course, like I said, this is wrong, and the Obama administration later said the economy was really worse than it had expected when the technicals failed to predict the direction of the trend.

The technicals fail to predict the trend because the capital is too consolidated for the laws of supply and demand to behave as expected. Instead, like I said then, because the risk proportion is going fully gamma, a falling oil price signals recovery...something that a Recovery Act will not do, what a JOBS Act will not do, but what expansion of the monetary supply to deconsolidate the risk will do in short order.)

Temporal fallacy is critical for maintaining technical failure. When too-big-to-fail banks operate unregulated and bankrupt millions of Americans (with no liability because it is an uncontrollable, aggregate effect described as market efficiency), regulation is legislated to make the market more efficient. When regulation does not cure the problem, but may in fact support it because it is a symptomatic treatment, the lack of resistance is attributed to the effect (regulation) and not the cause.

The marketplace is then deregulated, rather than deconsolidated, to solve the problem with the efficiency of markets. With regulation again in demand to make markets more efficient (Dodd-Frank, for example), the value of the risk proportion (the too-big-to-fail tautology) is conserved.

Conservation of the risk in a catastrophic (aggregative) proportion demands command authority. It demands, for example, the regulatory authority (the bureaucratic model) of the Federal Reserve (manipulation of the money supply). Reducing deflationary risk to prevent a declining rate of profit requires adding to the money supply (aggregating risk on command) with the result being the stagflation we have now, which can, of course, be blamed on the Fed acting (by fiat, or non-market means) to treat the symptoms (the effects) to conserve the cause. With this kind of deductive reasoning (the tautology), considering that the problem persists whether we regulate or deregulate, consolidation is never the problem but always considered to be the regulated or unregulated solution.

With weak demand the Fed will naturally keep interest rates at record lows, and the funds available (the supply of money added) will be used to bid up the oversupply, which weakens demand against high prices. Technically, the marketplace is being efficiently managed into failure, parlously perched on the precipice, just one nudge away from being pushed into a full-blown deflationary trend.