Today is “John
Frum Day.” John Frum (also known as “From”
and “Fram”) is a god in the South Pacific originally known as “John From Jesus
Christ,” a reincarnation of John the Baptist. As the myth evolved in the late nineteenth
century, John Frum was to restore the ancient way of life of the native peoples
and open Heaven’s Cargo Workshops to them instead of restricting the wealth to
white people.
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| "Perform the right rituals, and it will work." |
After World War
II, the movement that at first resembled the “Ghost Dance” of American Indians promising
a future golden age if the white man would just leave, rapidly evolved into a
millennialist religion that promised the good life here and now if the white
man would only return — as long as the airplanes and vessels carrying the cargos
of spam, Coca Cola, and Hershey bars that the American soldiers were so willing
to share kept on coming.
Knowing that the
white people were concealing the proper magical rituals from black people, the
natives took careful note of the arcane ceremonies the Americans employed to
summon their fabulous wealth from God’s Cargo Workshops. They built their own airstrips and
warehouses, duplicating in wood, straw, and bamboo the control towers and radio
shacks and the equipment they contained — sometimes even the personnel — so
that they could receive the messages John Frum would send to his faithful
followers to signal the day and hour when he would climb out of the volcano
known as Yasur (God) and restart the flood of cargo.
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| "Perform the right rituals, and it will work." |
This is actually
supremely logical, given the assumptions of the natives. The idea is that by duplicating outward forms
and anticipated results you can bring about the desired ends. This is a type of “magical” thinking, the
“law of similarity” whereby if a thing looks
the same, it is the same. The rationale is that if the outward forms
are duplicated with sufficient accuracy, the cargo will reappear. Americans and Europeans who try to explain
the fallacies in the paradigm are treated with pity and condescension at best,
with suspicion and hatred at worst. It
is useless to point out that the same effort put into productive activities
would long ago have made the islanders much wealthier than their ephemeral
dreams of cargo.
Nor does this
sort of magical thinking afflict merely presumably ignorant and benighted
native people of the South Pacific. It
is rife amongst allegedly advanced and sophisticated people everywhere . . .
especially Keynesians.
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| "Think it through, experiment, and see if it works." |
Physicist Richard
Feynman coined the term “cargo cult science” in his 1974 Caltech commencement
speech, and later included it in a chapter in his book Surely You're Joking, Mr. Feynman! (1985). Feynman claimed cargo cult science mimics
real science (especially by publishing in scientific journals) but lacks
genuine experimentation — in other words, a way to get or maintain a Ph.D.
without actually having to come up with something that is verifiably true.
More to the
point, in his novel The Trouble with
Nigeria (1984), Chinua Achebe criticized the “cargo cult mentality” of the
governments of many developing countries.
They issue proclamations about how great things are going to be if
they’re elected, but don’t do anything to try and establish the desired state
of affairs, evidently thinking that the mere proclamation or the passage of a
law or two will, in and of itself, do the job.
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| "Just do as I tell you, and it will work." |
Just as Cargo
Cultists can point to a time when everything worked the way they claim it
should and for the reasons they assert, adherents of Keynesian economics can
point to a specific time — coincidentally that same Second World War — during
which the economy was restored and universal prosperity was established through
full employment. Earlier efforts to
achieve full employment during the (second) Great Depression had been balked by
the refusal of FDR and other leaders to perform the proper rituals and invoke the necessary spirits, as Keynes complained in his famous open
letter published in the New York Times
on December 31, 1933.
Once the war was
over, the Keynesian rituals to maintain full employment were continued, and
seemed to work for a while. Cracks soon
appeared, however, necessitating the development of new rituals. The strain of paying for both the Vietnam War
and the Great Society increased the national debt enormously. Given the right ceremonies and calling on the right gods, however, economists
and politicians were confident that full employment (the developed nations’
version of cargo), could be permanently restored.
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| "Remember people, we're all Keynesians except when we're not!" |
Since the 1970s
(when even Milton Friedman declared, “We are all Keynesians now”), much effort
and tremendous resources have been expended to duplicate the outward forms of a
prosperous society. Just as the Cargo
Cultists build bamboo airplanes and warehouses, Keynesians create the usual
accompaniments to full employment, e.g.,
plenty of money, high paying wage system jobs, the creation of gigantic
corporations, welfare, entitlements, a well-educated citizenry, and so on. Keynesians fail to realize, for example, that
education doesn’t generate wealth.
Wealth pays for education. The
myth that has burdened millions of students with unrepayable debt is that
education brings prosperity, rather than that prosperity allows people to
become educated.
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| "Just follow the good book . . . of me." |
Pointing out that
things like full employment, adequate wages, benefits, education and social
welfare are not the causes of
prosperity but the results earns the
pointer-outer the pity and condescension of the economic and political
establishment at best, its contempt and anger at worst. It is useless to explain that paying people
for nothing or increasing the amount of money before increasing the present
value of existing and future marketable goods and services (current and future
production) only debauches the currency and redistributes existing wealth
without creating any new wealth. Noting
that neglecting to establish widespread ownership of capital to replace
disappearing wage system jobs as technology takes over the burden of production
incites rage at such heresy.
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| Creating symbols of wealth creates wealth . . . right? |
Keynesians ignore
the obvious fact that there is no actual increase in the money
supply through the alleged operation of the money multiplier. There is only a transfer of existing money as
checks are deposited, presented for payment, and clear. The Keynesian money multiplier explains
nothing. It is only useful in explaining
away the operation of the ridiculed real bills doctrine. Reversing cause and effect and ignoring all
evidence to the contrary, the unquestioned dogma is that increasing the money
supply brings full employment.
Keynesians and others deride the possibility that money is a result of
creating a means to convey a claim on the present value of existing and future
production — the real bills doctrine, a result of wealth creation, not its
cause.
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| "I'm from the government, and I'm here to help!" |
Keynesians remain
firmly convinced that prosperity can only result if John From the Government
establishes full employment (brings back cargo) and the outward signs of prosperity by law,
that is, by force. Then wealth
production will presumably follow automatically, creating abundance for
all. They fail to realize that if the
tremendous effort and vast resources that have already been used to try and
make Keynesianism work and get something for nothing had been put to productive
use, the world economy would not be in the mess it is in today.
There is a way
out, however. Through restructuring our
institutions, especially our money and tax systems, Capital Homesteading has
the potential to make it possible for every child, woman and man to acquire a
capital stake sufficient to generate income to meet normal living
expenditures. This becomes critical as
advancing technology eliminates increasing numbers of wage system jobs, and
those with wealth become increasingly resistant to redistribution. Further, current methods of financing new
capital formation not only maintain the current position of the wealthy and
shut out virtually everyone else from the chance of acquiring and possessing
private property in capital, they operate to concentrate ownership of almost
all new capital in fewer and fewer hands.
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| Homestead not just land, but commerce and industry as well. |
The solution is
to establish a national economic policy based on the binary growth model,
designed to lift barriers in the present financial and economic system and
universalize access to the means of acquiring and possessing capital assets — a
“Capital Homestead Act.” The Capital
Homestead Act would allow every child, woman and man to accumulate a target level
of capital assets. Using a tax-deferred
“accumulation vehicle” similar to an IRA, the amount would be sufficient to
generate an adequate and secure income for that person without requiring the
use of existing pools of savings or reductions in current levels of
consumption.
Each capital homesteader’s
account would be able to receive annual allocations of interest-free (but not
cost-free), productive credit. This
would begin the process of creating new asset-backed money through the central
bank, administered by local commercial banks by investing in feasible private
sector capital formation and expansion projects of businesses that would issue
new shares to be purchased and sheltered in the citizen’s Capital Homestead
Account. After the "future
savings" (future profits) generated by the productive assets paid off each
year's Capital Homestead investment (loan) and canceled the money, the citizen
would continue to receive in the form of dividends the incomes generated by
those capital assets.
There is, of
course, much more to it than that. An
overview can be found on the website of the Center for Economic and Social
Justice under “Capital Homesteading.”
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