This week, Adam Partington caught up with Ross Ashcroft, the co-founder of RenegadeEconomist.com and director of the award-winning documentary film Four Horsemen, which analyses the present system of fractional-reserve banking, debt-based economies, and political lobbying by banks.
The film also criticises the controversial War on Terror, takes a deep look into the dynamics of our current paradigm, and advocates a return to classical economics…
George Osborne keeps on telling the people of Britain that he’s fixed the economy. Has he?
No. He’s merely kicked the can further down the road. By reflating the housing market he went for a short term political fix instead of mustering the courage to change the fundamentals. That means that housing – a basic human right – has been pushed out of the reach of millions. It also means that when the reflated housing bubble busts it will take the banking system and/or taxpayer down with it. Implicit in Mr Osborne’s actions is the perverse assumption that the biggest credit or debt bubble in human history is an optimum market condition. History will not be kind.
Who really caused financial crisis of 2008, the bankers or the politicians?
Almost all of us. Whenever you point a finger there are three fingers pointing back at you. Almost everyone was complicit. It’s easy to take your eye off the ball when house prices are going up and those gains are used for consumer spending. The bankers kept feeding the debt bubble, the politicians kept everyone in the dark and many of the public adopted a consumerist “here to be served” mentality. Everyone hoped above hope that someone else would sort out the eventual mess and here it is – a nuclear hangover. But the blame game is futile – everyone was at it – and the social cost has been astronomical.
In your film, Four Horsemen, it is said that we will never return to ‘business as usual’ – what exactly does that mean?
The world and the business cycle have changed for good. Corporate management techniques are obsolete, we have had peak financial services in the West and artificially inflated land (house) prices are now totally disconnected from wages. Politicians are trying to relive the good old days of industrial capitalism but what we have today is parasitic financial capitalism and unfortunately that does not create any wealth. We now need to get back to creating real wealth instead of stealing the wealth of others i.e. rent seeking. The Rentier Class is no longer welcome and the Wealth Creator Class must to take centre stage if we want to thrive.
What’s the biggest problem with neo-classical economic ideologies?
The people who believe in them.
Can we trust anybody from within the current crop of mainstream politicians?
Sadly no. Some are good but many are a colossal distraction who cannot affect any change because the economic rules are rigged. The Houses of Parliament have been overrun by lobbyists, rent seekers and predatory financiers. This makes the politician little more than a lackey to big business. Churchill and other great Statesman would be incandescent.
How about Ukip or the Greens, might they have the answers?
The Greens are slightly more economically literate but – from what I can make out – Ukip are clueless when it comes to economic policy. Mr Farage is a brilliant salesman and presenter but that’s where it ends. He’s the Jeremy Clarkson of politics and sadly there is a market for that.
I tried to get somebody at work to watch your film, but they said that the likes of you, Max Keiser and John Perkins were just jealous of people who have excelled in the current economic climate. How would you reply to that?
It really depends on how you define ‘excelled’ and ‘success’. Many who have excelled materialistically define success in very limited terms. If you aren’t at home to watch your kids grow up, if you have to play the corporate game in a toxic culture, if you can only socialise with your own tribe, if your industry has a problem with suicide and drugs then I’m not sure who could be jealous of that life. Love them or hate them John and Max are their own people and have independent minds. They can say and do what they want. Many people cooped up in deathly political hierarchies would love to be in that situation.
What advice would you have for Generation Y? Should we be obtaining mortgages, flash cars and fancy clothes or investing in Gold, Silver and Bitcoin?
The only advice is to back yourself. Don’t give the best years of your life to a monolithic institution that does not have your best interests at heart. Money is necessary but overrated – never chase money. Lately society has given cash too much credence. When you think about it most really successful people haven’t chased money – they’ve dedicated themselves to a cause greater than themselves. This is a wise move. So my advice is to follow your heart, work with good people and build equity not a car collection. Mortgages aren’t a great idea in such a warped housing market. Stay nimble – find the thing you love – be brilliant at that thing and dress well.
In terms of the bigger picture people always tell me that I shouldn’t really worry about things like the economy, the environment or corrupt politicians because this is just the way it is… How would you respond to that?
It is exactly that attitude that has allowed our nation to be sold out to predatory finance. I’m not a fan of defeatist types – or ostriches for that matter.
Are China or Russia going to be the next global leaders?
China and Russia have huge potential but they are not free of internal problems. When the Chinese property bubble bursts the global effect will be tremendous as will the anger of the Chinese aspirational classes. Both countries have plenty of housekeeping to do before they can think about meaningful leadership.
In 1998 Gore Vidal said: “The year 2000 will not only mark the end of American primacy but the end of the hegemony of the white race. We shall comprise about 16% of the world’s population in eight years. Let us hope that the other tribes, particularly those of Asia, in their triumph, do not treat us as badly as we have treated them”. He was right. Generally Angelo-American imperialist foreign policy has been, at best, unenlightened.
As this interview will be published on The Targe; what is your opinion of Scotland’s independence vote? From an economic standpoint, should the Scottish vote yes or no?
I think the vote itself is important as it makes the Scots really consider what it means to be Scottish and this uncovers fundamental beliefs and guiding principles. Economically there’s a case for greater autonomy in Scotland because Westminster – like all centrally planned economic structures – has often failed the Scottish. The resource rents taken from North Sea oil should have been allocated more fairly so if an efficient tax system could be established then Scotland could become the threat of a good example.
And finally, after making the film, is humanity doomed or is change actually possible?
Change is already happening. Humanity is going through creative destruction that is necessary for us to progress. The current economic set up we endure cannot and will not hold. Humans are adaptable creatures and I think this is one of the most exciting times to be alive. Yes there is ugliness but that’s because light is being shone into places that were previously dark. Humanity isn’t doomed but equally we all have to play our part – nobody else will do it for us.