The COVID-19 pandemic generated uncanny circumstances being experienced worldwide, after all the tragic consequences of wars in the 20th century. The everyday environment is far from the common social-economic order. People of all classes are trying to cope with physical restraint, spiritual loneliness, global uncertainty, and anxiety about the future.
The Post-Truth regime we’ve been witnessing for over a decade, combined with the pandemic, has further complicated our realisation, perception, awareness and knowledge. Political and economic activity is being structured according to a new impasse.
What does this naked and absolute truth we experience mean for the future? This is the most asked question today in the global arts and culture scene: the most omnipresent and operational human action versus economics and politics.
Post-truth is understood as the modification of the meaning of truth, a system which aims to capture political and economic power. The current concerns about global economy, politics and culture that are under the unavoidable hegemony of post-truth, are forcing us to re-think the relevance of truth – which is the main concept and goal of contemporary art – and the relevance of today’s Relational Aesthetics productions.
Artists, art critics, academicians and experts working in this field are facing a new challenge to communicate with the pandemic-stricken public through contemporary art. The main setback in this field is the difference in political- social-economic orders, despite the growing controlling power of capitalism.
The truth is that there are countries and regions which respect democracy, justice, human rights etc., and there are countries that are far removed from these indisputable values. To my regret, I speak from a country [Turkey] with a damaged democracy that embraces post-truth. As Jürgen Habermas put it: “A ‘post-truth democracy’ […] would no longer be a democracy.” *
In non-democratic systems, there are a series of adverse issues that relate to the relevance of contemporary art and culture productions, as well as activities of artists towards their audiences. Mass media collaborates with ruling powers which offer limited democracy, all the while convincing people that they actually live in a democracy. The culture and art industry, with its populist, financially dependent systems and inevitable PR backing, promises an almost selfless service to the society of the spectacle, which simply produces illusions. Skeptical or dissident artists are confronted with this ongoing complexity.
In 2016, in Berlin, during my participation in ‘Soul for Europe’, I had the opportunity to justify the ongoing power of contemporary art and culture production in countries with limited democracy. I claimed that contemporary artists, art experts, artistic and cultural activities in Turkey (and in similar countries in the region), private institutions or individual initiatives, are effective in fulfilling cultural aims and intentions, such as:
a clear and unbiased vision towards democratic transformation freedom of expression and communication respect for pluralism, human and gender rights responsibility on ecological problems development of public awareness Visual artists with their aesthetically qualified, conceptually competent artworks, are widely and strongly enriching visual productions, and women artists are at the forefront of this. But, how artists profit from their productions, or rather how they survive, remains a crucial question.
Most artists work at universities, graphic design companies or public art studios. A small number of artists are supported by their families or other private income. Private galleries occasionally employ curators. However, museums or private art and culture venues, are not enough to meet artists’ employment demands, not to mention that these often prefer to run their institutions with low-wage policies.
Under the current political and economic conditions in Turkey and in the region, it may be difficult to continue to strengthen socio-cultural and artistic endeavours. Artists are today looking for opportunities to live and work abroad in the EU, but this too has become almost impossible under pandemic conditions. Fortunately artists and art professionals can see, categorise and mark the apparatuses that serve post-truth regimes.
These adverse apparatuses show the affluent life of the privileged classes as the only goal of life, with productions used as “a must” towards this goal. These institutions intervene into the organic communication between creative people and the public with the intention of converting every piece of this communication into money. They canalise existing art forms and their critical information through alien systems, and load them with contents that don’t belong to them. They convert the quality of artworks, which aim to reach very large audiences, into profit.
Here, we need a new approach to the global art market; to underline the border between the socio-political-cultural value and the market value of artwork. This is more essential in non-democratic countries where only decorative creations can be exhibited and marketed. In the post-truth pandemic order we live in, especially in the countries where democracy is damaged, Relational Aesthetics products, which make critical and oppositional visual productions between the truth regime and the Post-truth regime, are seen in opposition to traditional identity, nationalism, religion and Neo-capitalist mass-culture.
If we consider that Relational Aesthetic artworks have a function within the visual aggression of Post-truth, it is evidently the enigmatic visual language that penetrates into the subconscious of society and provokes awareness. However, in many countries these productions are abused by censorship and vandalism. But these attacks are not preventing the continuity of art production. The curators who stand by artists and their works inevitably take a political stand and provide opportunities for this continuity.
In such hostile political environments, a counter-position is created by empowering art and culture workforces through the founding of NGOs, as well as art and culture initiatives at the global level. Global artist and art-experts residency programs, and artistic and cultural projects funded by public and private initiatives, are the main strongholds of sustainability.
Since 1990, exhibitions, symposiums and workshops organised in Turkey, the Balkans, the Middle-East and South Caucasus in collaboration with EU institutions, significantly reflected the will and vision of collaboration in arts and culture. Throughout the 1990’s EU culture policy applications didn’t only provide opportunities for artists and curators seeking new audiences and markets, but also supported cultural ventures in non-democratic or semi-democratic countries.
However most of these countries are still exposed to political and economic transformations and blockages. This means that the art and culture workforce is still seeking new allies and partners to tackle and overcome the grandeur of the task. The EU’s distribution of knowledge and funds for multicultural exhibitions into region or city-based locations also played a role in reducing the authority of modernist state-controlled art and culture structures based on local, national or 20th century Eurocentric proclamations.
Turkey’s art and culture developments since the 1980’s is an example of this significant role. The intense art exchange within the region, where Istanbul is the center of early accomplishments in art and culture, consists of multilateral exhibitions, roundtable or symposium meetings and artist residencies.
Currently two directions influence art and culture policies in Turkey: One of them is the prevailing official culture policy trapped into Modernist ideology, mixed with nostalgia to an illusory İslamic art and culture. The other is in correlation with private sector investments, the irrepressible dynamism of contemporary art-making and cultural activities through international exchange, communication and market relations.
I think that the EU made efforts to fulfil its function of preserving cultural diversity, while at the same time providing equality in the systems of communication and exchange. However, there is a big problem in this function. The EU’s policy of updating art and culture policies in countries experiencing political and economic turmoil has fissures that need to be revised.
For instance, the mainstream international art and culture industry has very strong links with private international enterprises. It comprises a huge and complex network of artists, galleries, media, curators, collectors, private and official institutions. It is therefore an impenetrable entity that has its own rules and concepts and does not like to be manipulated by any other power. It has its own power and all the actors of the system enjoy this power.
The other system includes official institutions, museums, universities and state/nation political policies. The interests of this system are founded in nation-state ideologies, which is another unit one cannot easily penetrate into. Another issue are the dynamics of art itself. Artists are independent, free, and want to do whatever they believe in.
If there is a next future, the EU art and culture policy should consider its interest in democracies in bordering territories, and support the dissident art and culture producers living in autocracies.
Beral Madra is an art historian, critic, curator and elected member of DiEM25’s Coordinating Collective.
Shirin Neshat creates art with a cosmopolitan feel that is as moving as it is relatable. Born in Iran, she was pursuing her education in the United States during the Islamic Revolution of 1979. The revolution prevented her from returning home for nearly 20 years and when she did, Iran was entirely transformed. The shift from a Persian culture to an Islamic one was jarring for Neshat as she had no real connection to the transition. During her trip home she resolved to create artwork as a means of understanding this cultural shift, and as a way of creating a sense of closeness to her homeland. Ironically, her artwork is the reason Neshat is no longer welcome in Iran.
Filmed in Morocco in 2000, Fervor is a two-channel video that takes place in an allegorical Iran. The video features a female protagonist on one screen and a male protagonist on the other. They pass on foot in route to a gathering where a mullah preaches to a segregated crowd about being chaste. The two characters give each other sideways glances and do not act on their clearly amorous desires. Their love remains unrequited, their relationship unresolved. This understated work of art is titillating and frustrating, revealing Neshat’s layered intentions. She is specifically interested in the problematic position of concepts like temptation, sexuality, and desire in the Middle East, but is more broadly interested in the tension created between individuals and the social order.
A podcast to expand our idea of the future.
Future Histories is a predominantly German language podcast. However, since there’s an English episode sparkled in once in a while, we created an English-only RSS feed and homepage to make things easier for our international audience. Find the German version with all episodes of Future Histories here: www.futurehistories.today. English episodes of Future Histories are accessible here: www.futurehistories.today
Complaints about the U.S. military’s influence operations using Facebook and Twitter have raised concern in the White House and federal agencies.
The Pentagon has ordered a sweeping audit of how it conducts clandestine information warfare after major social media companies identified and took offline fake accounts suspected of being run by the U.S. military in violation of the platforms’ rules.
Colin Kahl, the undersecretary of defense for policy, last weekinstructed the military commands that engage in psychological operations online to provide a full accounting of their activities by next month after the White House and somefederal agencies expressed mounting concerns over the Defense Department’s attempted manipulation of audiences overseas, according to several defense and administration officials familiar with the matter.
The takedowns in recent years by Twitter and Facebook of more than 150 bogus personas and media sites created in the United States was disclosed last month by internet researchers Graphika and the Stanford Internet Observatory. While the researchers did not attribute the sham accounts to the U.S. military, two officials familiar with the matter said that U.S. Central Command is among those whose activities are facing scrutiny. Like others interviewed for this report, they spoke on the condition of anonymity to discuss sensitive military operations.
The researchers did not specify when the takedowns occurred, but those familiar with the matter said they were within the pasttwo or three years. Some were recent, they said, and involved posts from the summer that advanced anti-Russia narratives citing the Kremlin’s “imperialist” war in Ukraine and warning of the conflict’s direct impact on Central Asian countries. Significantly, they found that the pretend personas — employing tactics used by countries such as Russia and China — did not gain much traction, and that overt accounts actually attracted more followers.
Centcom, headquartered in Tampa, has purview over military operations across 21 countries in the Middle East, North Africa and Central and South Asia. A spokesman declined to comment.
Air Force Brig. Gen. Patrick Ryder, the Pentagon press secretary, said in a statement that the military’s information operations “support our national security priorities” and must be conducted in compliance with relevant laws and policies. “We are committed to enforcing those safeguards,” he said.
Spokespersons for Facebook and Twitter declined to comment.
According to the researchers’ report, the accounts taken down included a made-up Persian-language media site that shared content reposted from the U.S.-funded Voice of America Farsi and Radio Free Europe. Another, it said, was linked to a Twitter handle that in the past had claimed to operate on behalf of Centcom.
One fake account posted an inflammatory tweet claiming that relatives of deceased Afghan refugees had reported bodies being returned from Iran with missing organs, according to the report. The tweet linked to a video that was part of an article posted on a U.S.-military affiliated website.
Centcom has not commented on whether these accounts were created by its personnel or contractors. If the organ-harvesting tweet is shown to be Centcom’s, one defense official said, it would “absolutely be a violation of doctrine and training practices.”
Independent of the report, The Washington Post has learned that in 2020 Facebook disabled fictitious personas created by Centcom to counter disinformation spread by China suggesting the coronavirus responsible for covid-19 was created at a U.S. Army lab in Fort Detrick, Md., according to officials familiar with the matter. The pseudo profiles — active in Facebook groups that conversed in Arabic, Farsi and Urdu, the officials said — were used to amplify truthful information from the U.S. Centers for Disease Control and Prevention about the virus’s origination in China.
The U.S. government’suse of ersatz social mediaaccounts, though authorized by law and policy, has stirred controversy inside the Biden administration, with the White House pressing the Pentagon to clarify and justify its policies. The White House, agencies such as the State Department and even some officials within the Defense Department have been concerned that the policies are too broad, allowing leeway for tactics that even if used to spread truthful information, risk eroding U.S. credibility, several U.S. officials said.
“Our adversaries are absolutely operating in the information domain,” said a second senior defense official. “There are some who think we shouldn’t do anything clandestine in that space. Ceding an entire domain to an adversary would be unwise. But we need stronger policy guardrails.”
A spokeswoman for the National Security Council, which is part of the White House, declined to comment.
Kahl disclosed his review at a virtual meeting convened by the National Security Council on Tuesday, saying he wants to know what types of operations have been carried out, who they’re targeting, what tools are being used and why military commanders have chosen those tactics, and how effective they have been, several officials said.
The message was essentially, “You have to justify to me why you’re doing these types of things,” the first defense official said.
Pentagon policy and doctrine discourage the military from peddling falsehoods, but there are no specific rules mandating the use of truthful information for psychological operations. For instance, the military sometimes employs fiction and satire for persuasion purposes, but generally the messages are supposed to stick to facts, officials said.
In 2020, officers at Facebook and Twitter contacted the Pentagon to raise concerns about the phony accounts they were having to remove, suspicious they were associated with the military. That summer, David Agranovich, Facebook’s director for global threat disruption, spoke to Christopher C. Miller, then assistant director for Special Operations/Low Intensity Conflict, which oversees influence operations policy, warning him that if Facebook could sniff them out, so could U.S. adversaries, several people familiar with the conversation said.
“His point‚” one person said, “was ‘Guys, you got caught. That’s a problem.’ ”
Before Miller could take action, he was tapped to head a different agency — the National Counterterrorism Center. Then the November election happened and time ran out for the Trump administration to address the matter, although Miller did spend the last few weeks of Donald Trump’s presidency serving as acting defense secretary.
With the rise of Russia and China as strategic competitors, military commanders have wanted to fight back, including online. And Congress supported that. Frustrated with perceived legal obstacles to the Defense Department’s ability to conduct clandestine activities in cyberspace, Congress in late 2019 passed a law affirming that the military could conduct operations in the “information environment” to defend the United States and to push back against foreign disinformation aimed at undermining its interests. The measure, known as Section 1631, allows the military to carry out clandestine psychological operations without crossing what the CIA has claimed as its covert authority, alleviating some of the friction that had hindered such operations previously.
“Combatant commanders got really excited,” recalled the first defense official. “They were very eager to utilize these new authorities. The defense contractors were equally eager to land lucrative classified contracts to enable clandestine influence operations.”
At the same time, the official said, military leaders were not trained to oversee “technically complex operations conducted by contractors” or coordinate such activities with other stakeholders elsewhere in the U.S. government.
President Biden, right, Defense Secretary Lloyd Austin, left, and Chairman of the Joint Chiefs of Staff Gen. Mark A. Milley attend a Pentagon ceremony to remember the victims of 9/11. (Leigh Vogel/Bloomberg)
Last year, with a new administration in place, Facebook’s Agranovich tried again. This time he took his complaint to President Biden’s deputy national security adviser for cyber, Anne Neuberger. Agranovich, who had worked at the NSC under Trump, told Neuberger that Facebook was taking down fake accounts because they violated the company’s terms of service, according to people familiar with the exchange.
The accounts were easily detected by Facebook, which since Russia’s campaign to interfere in the 2016 presidential election has enhanced its ability to identify mock personas and sites. In some cases, the company had removed profiles, which appeared to be associated with the military, that promoted information deemed by fact-checkers to be false, said a person familiar with the matter.
Agranovich alsospoke to officials at the Pentagon. His messagewas: “We know what DOD is doing. It violates our policies. We will enforce our policies” and so “DOD should knock it off,” said aU.S. official briefed on the matter.
In response to White House concerns, Kahl ordered a review of Military Information Support Operations, or MISO, the Pentagon’s moniker for psychological operations. A draft concluded that policies, training and oversight all needed tightening, and that coordination with other agencies, such as the State Department and the CIA, needed strengthening, according to officials.
The review also found that while there were cases in which fictitious information was pushed by the military, they were the result of inadequate oversight of contractors and personnel training — not systemic problems, officials said.
Pentagon leadership did little with the review, two officials said, before Graphika and Stanford published their report on Aug. 24, which elicited a flurry of news coverage and questions for the military.
Army psyop graduates receive pins at the end of a field exercise reading “Persuade, Change, Influence.” (Cynthia McIntyre/Fort Hunter Liggett Public Affairs)
The State Department and CIA have been perturbed by the military’s use of clandestine tactics. Officers at State have admonished the Defense Department, “Hey don’t amplify our policies using fake personas, because we don’t want to be seen as creating false grass roots efforts,” the first defense official said.
One diplomat put it this way: “Generally speaking, we shouldn’t be employing the same kind of tactics that our adversaries are using because the bottom line is we have the moral high ground. We are a society that is built on a certain set of values. We promote those values around the world and when we use tactics like those, it just undermines our argument about who we are.”
Psychological operations to promote U.S. narratives overseas are nothing new in the military, but the popularity of western social media across the globehas led to an expansion of tactics, including the use of artificial personas and images — sometimes called “deep fakes.” The logic is that views expressed by what appears to be, say, an Afghan woman or an Iranian student might be more persuasive than if they were openly pushed by the U.S. government.
The majority of the military’s influence operations are overt, promoting U.S. policies in the Middle East, Asia and elsewhere under its own name, officials said. And there are valid reasons to use clandestine tactics, such as trying to infiltrate a closed terrorist chat group, they said.
A key issue for senior policymakers now is determining whether the military’s execution of clandestine influence operations is delivering results. “Is the juice worth the squeeze? Does our approach really have the potential for the return on investment we hoped or is it just causing more challenges?” one person familiar with the debate said.
The report by Graphika and Stanford suggests that the clandestine activity did not have much impact. It noted that the “vast majority of posts and tweets” reviewed received “no more than a handful of likes or retweets,” and only 19 percent of the concocted accounts had more than 1,000 followers. “Tellingly,” the report stated, “the two most-followed assets in the data provided by Twitter were overt accounts that publicly declared a connection to the U.S. military.”
Clandestine influence operations have a role in support of military operations, but it should be a narrow one with “intrusive oversight” by military and civilian leadership, said Michael Lumpkin, a former senior Pentagon official handling information operations policy and a former head of the State Department’s Global Engagement Center. “Otherwise, we risk making more enemies than friends.”
Alice Crites contributed to this report.
The SOAS Development Studies Department and the Progressive Economy Forum invite you to a Book Launch for Guy Standing’s The Blue Commons.
The Blue Commons is an urgent call for change, from a campaigning economist responsible for some of the most innovative solutions to inequality of recent times. From large nations bullying smaller nations into giving up eco-friendly fishing policies to the profiteering by the Crown Estate in commandeering much of the British seabed, the scale of the global problem is synthesised here for the first time, as well as a toolkit for all of us to rise up and tackle it.
The oceans have been left out of calls for a Green New Deal but must be at the centre of the fight against climate change. How do we do it? By building a Blue Commons alternative: a transformative worldview and new set of proposals that prioritise the historic rights of local communities, the wellbeing of all people and, with it, the health of our oceans.
Guy Standing has held professorships at Bath, London and Monash universities, was a programme director in the UN’s International Labour Organization and has advised many international bodies and governments on social and economic policies. He co-founded the Basic Income Earth Network and is now its co-president. He is author of the bestselling The Precariat: The New Dangerous Class, Basic Income: And How We Can Make It Happen and Plunder of the Commons: A Manifesto for Sharing Public Wealth.
Join us on 11 October at 18:00 at the Brunei Gallery Theatre for the launch with drinks reception afterwards.
An open letter co-signed by 100 individuals and organizations says the festival’s advisory council has miscast any criticism of Israel as antisemitic.
An open letter published in e-flux this weekend and co-signed by almost 100 individuals and organizations in Documenta 15’s “lumbung community” condemns the exhibition’s leaders for allowing a “hostile environment” to prevail at the international contemporary art show hosted in Kassel, Germany.
The most recent offense the letter responds to is a preliminary assessment, released by Documenta’s advisory council this month, recommending the censorship of a film screening by the collective Subversive Film. According to a press release, the panel came to a consensus that the “most urgent task” was to immediately stop showing Tokyo Reels Film Festival (TRFF), a set of freshly restored films originally made between the 1960s and ’80s exploring Japanese and Palestinian anti-imperial solidarity. In a curatorial statement submitted to the exhibition, Subversive Film called these films “militant cinema.” Currently, Documenta’s website continues to list two upcoming TRFF screenings for the evenings of September 14 and September 21.
In response to Hyperallergic’s request for comment, Documenta 15’s press coordinator sent the following statement: “The management of documenta and ruangrupa have taken note of the assessment of the committee. ruangrupa, as the Artistic Direction of documenta fifteen has the sole right to decide and does not wish to follow the recommendation to temporarily remove the work Tokyo Reels by Subversive Film from the exhibition.”
The advisory committee deemed the films, as well as talks accompanying the screenings, inappropriate. “What is highly problematic about this work is not only the films, which contains antisemitic and anti-Zionist elements, but also the comments inserted between the films, which legitimize the hatred of Israel and the glorification of terrorism in the source material through heir uncritical discussion,” the council determined. It then proceeded to criticize the “one-sided” portrayal of Israelis and Palestinians in the films and the characterization of Israel as “fascist.” The council’s statement invoked the International Holocaust Remembrance Alliance’s definition of antisemitism to argue that TRFF qualifies as antisemitic.
The September 10 open letter — signed by Documenta 15’s curatorial group ruangrupa, Palestinian artist collective the Question of Funding, and Subversive Film, all of whom have now been targets of antisemitism allegations in the course of Documenta 15’s lead-up and run — pushes back on the advisory council’s verdict.
“We do not accept the allegations of their preliminary report, which unashamedly reproduce poorly researched claims from the media; likewise, the report lacks scientific proof, academic references, rigorous argumentation and integrity,” the open letter reads. The writers specifically take issue with the International Holocaust Remembrance Alliance’s definition of antisemitism, contending that it miscasts any criticism of Israel as antisemitic, and denounces the council’s categorization of TRFF as “propaganda.”
“Their simplistic notion of ‘propaganda’ enables a specious argument that critique of the State of Israel is an incitement of hatred of an entire people—this is a very serious accusation that shocks and hurts us,” the letter continues, reiterating support for Jewish “comrades” whom they are united with in the struggle against the Israeli state.
Beyond refuting the council’s argument, the open letter criticizes Documenta’s role in cultivating an environment in which artists and curators have been subject to a relentless smear campaign. “We are outraged, we are exhausted, but our struggle will continue,” it reads.
Documenta has not responded to Hyperallergic’s immediate request for comment.
In August, Documenta’s shareholders assembled a “scientific advisory committee” comprised of seven academics with expertise variously in the areas of antisemitism, post-colonialism, and art law “in the light of antisemitic incidents” that had allegedly transpired at the exhibition. “The reoccurring antisemitic motifs seen at documenta fifteen demonstrate the continuous actuality and reproduction of antisemitism. It is therefore essential, that the antisemitic incidences and the related reception and events are reviewed and examined by the scientific advisory panel,” Angela Dorn, the Hessian minister for Higher Education, Research, Science, and the Arts, said when the council was announced.
This development at Documenta 15, which closes in less than two weeks, is the latest chapter in a public row between curators, artists, and exhibition organizers that has been ongoing since before the show even opened. Allegations of antisemitism first surfaced in May when German media outlets picked up a pro-Israel blogger’s claims that the curators of and artists participating in Documenta 15 were antisemitic. An open letter responding to these allegations at the time labeled them “bad-faith attempts to delegitimize artists.” In late May, threatening vandalism appeared in exhibition spaces associated with The Question of Funding. In late June, Documenta removed an artwork called “People’s Justice” by Indonesian collective Taring Padi in its exhibition after it became the subject of scrutiny over antisemitic depictions. Former director Sabine Schormann resigned in mid-July.
Editor’s note 9/13/2210:15am EDT: This article has been updated with a statement from Documenta’s press coordinator.
As a humanist who writes about the impact of digital technology on our lives, I am often mistaken for a futurist. The people most interested in hiring me for my opinions about technology are usually less concerned with building tools that help people live better lives in the present than they are in identifying the Next Big Thing through which to dominate them in the future. I don’t usually respond to their inquiries. Why help these guys ruin what’s left of the internet, much less civilisation?
Still, sometimes a combination of morbid curiosity and cold hard cash is enough to get me on a stage in front of the tech elite, where I try to talk some sense into them about how their businesses are affecting our lives out here in the real world. That’s how I found myself accepting an invitation to address a group mysteriously described as “ultra-wealthy stakeholders”, out in the middle of the desert.
A limo was waiting for me at the airport. As the sun began to dip over the horizon, I realised I had been in the car for three hours. What sort of wealthy hedge-fund types would drive this far from the airport for a conference? Then I saw it. On a parallel path next to the highway, as if racing against us, a small jet was coming in for a landing on a private airfield. Of course.
The next morning, two men in matching Patagonia fleeces came for me in a golf cart and conveyed me through rocks and underbrush to a meeting hall. They left me to drink coffee and prepare in what I figured was serving as my green room. But instead of me being wired with a microphone or taken to a stage, my audience was brought in to me. They sat around the table and introduced themselves: five super-wealthy guys – yes, all men – from the upper echelon of the tech investing and hedge-fund world. At least two of them were billionaires. After a bit of small talk, I realised they had no interest in the speech I had prepared about the future of technology. They had come to ask questions.
A shelter under construction at the Rising S Company in Murchison, Texas. Photograph: Bloomberg/Getty Images
They started out innocuously and predictably enough. Bitcoin or ethereum? Virtual reality or augmented reality? Who will get quantum computing first, China or Google? Eventually, they edged into their real topic of concern: New Zealand or Alaska? Which region would be less affected by the coming climate crisis? It only got worse from there. Which was the greater threat: global warming or biological warfare? How long should one plan to be able to survive with no outside help? Should a shelter have its own air supply? What was the likelihood of groundwater contamination? Finally, the CEO of a brokerage house explained that he had nearly completed building his own underground bunker system, and asked: “How do I maintain authority over my security force after the event?” The event. That was their euphemism for the environmental collapse, social unrest, nuclear explosion, solar storm, unstoppable virus, or malicious computer hack that takes everything down.
This single question occupied us for the rest of the hour. They knew armed guards would be required to protect their compounds from raiders as well as angry mobs. One had already secured a dozen Navy Seals to make their way to his compound if he gave them the right cue. But how would he pay the guards once even his crypto was worthless? What would stop the guards from eventually choosing their own leader?
The billionaires considered using special combination locks on the food supply that only they knew. Or making guards wear disciplinary collars of some kind in return for their survival. Or maybe building robots to serve as guards and workers – if that technology could be developed “in time”.
It’s as if they want to build a car that goes fast enough to escape from its own exhaust
I tried to reason with them. I made pro-social arguments for partnership and solidarity as the best approaches to our collective, long-term challenges. The way to get your guards to exhibit loyalty in the future was to treat them like friends right now, I explained. Don’t just invest in ammo and electric fences, invest in people and relationships. They rolled their eyes at what must have sounded to them like hippy philosophy.
This was probably the wealthiest, most powerful group I had ever encountered. Yet here they were, asking a Marxist media theorist for advice on where and how to configure their doomsday bunkers. That’s when it hit me: at least as far as these gentlemen were concerned, this was a talk about the future of technology.
Taking their cue from Tesla founder Elon Musk colonising Mars, Palantir’s Peter Thiel reversing the ageing process, or artificial intelligence developers Sam Altman and Ray Kurzweil uploading their minds into supercomputers, they were preparing for a digital future that had less to do with making the world a better place than it did with transcending the human condition altogether. Their extreme wealth and privilege served only to make them obsessed with insulating themselves from the very real and present danger of climate change, rising sea levels, mass migrations, global pandemics, nativist panic and resource depletion. For them, the future of technology is about only one thing: escape from the rest of us.
These people once showered the world with madly optimistic business plans for how technology might benefit human society. Now they’ve reduced technological progress to a video game that one of them wins by finding the escape hatch. Will it be Jeff Bezos migrating to space, Thiel to his New Zealand compound, or Mark Zuckerberg to his virtual metaverse? And these catastrophising billionaires are the presumptive winners of the digital economy – the supposed champions of the survival-of-the-fittest business landscape that’s fuelling most of this speculation to begin with.
A proposal for a Mars colony by Elon Musk’s company, SpaceX. Photograph: SpaceX
What I came to realise was that these men are actually the losers. The billionaires who called me out to the desert to evaluate their bunker strategies are not the victors of the economic game so much as the victims of its perversely limited rules. More than anything, they have succumbed to a mindset where “winning” means earning enough money to insulate themselves from the damage they are creating by earning money in that way. It’s as if they want to build a car that goes fast enough to escape from its own exhaust.
Yet this Silicon Valley escapism – let’s call it The Mindset – encourages its adherents to believe that the winners can somehow leave the rest of us behind.
Never before have our society’s most powerful players assumed that the primary impact of their own conquests would be to render the world itself unliveable for everyone else. Nor have they ever before had the technologies through which to programme their sensibilities into the very fabric of our society. The landscape is alive with algorithms and intelligences actively encouraging these selfish and isolationist outlooks. Those sociopathic enough to embrace them are rewarded with cash and control over the rest of us. It’s a self-reinforcing feedback loop. This is new.
Amplified by digital technologies and the unprecedented wealth disparity they afford, The Mindset allows for the easy externalisation of harm to others, and inspires a corresponding longing for transcendence and separation from the people and places that have been abused.
Instead of just lording over us for ever, however, the billionaires at the top of these virtual pyramids actively seek the endgame. In fact, like the plot of a Marvel blockbuster, the very structure of The Mindset requires an endgame. Everything must resolve to a one or a zero, a winner or loser, the saved or the damned. Actual, imminent catastrophes from the climate emergency to mass migrations support the mythology, offering these would-be superheroes the opportunity to play out the finale in their own lifetimes. For The Mindset also includes a faith-based Silicon Valley certainty that they can develop a technology that will somehow break the laws of physics, economics and morality to offer them something even better than a way of saving the world: a means of escape from the apocalypse of their own making.
By the time I boarded my return flight to New York, my mind was reeling with the implications of The Mindset. What were its main tenets? Who were its true believers? What, if anything, could we do to resist it? Before I had even landed, I posted an article about my strange encounter – to surprising effect.
Almost immediately, I began receiving inquiries from businesses catering to the billionaire prepper, all hoping I would make some introductions on their behalf to the five men I had written about. I heard from a real estate agent who specialises in disaster-proof listings, a company taking reservations for its third underground dwellings project, and a security firm offering various forms of “risk management”.
But the message that got my attention came from a former president of the American chamber of commerce in Latvia. JC Cole had witnessed the fall of the Soviet empire, as well as what it took to rebuild a working society almost from scratch. He had also served as landlord for the American and European Union embassies, and learned a whole lot about security systems and evacuation plans. “You certainly stirred up a bees’ nest,” he began his first email to me. “It’s quite accurate – the wealthy hiding in their bunkers will have a problem with their security teams… I believe you are correct with your advice to ‘treat those people really well, right now’, but also the concept may be expanded and I believe there is a better system that would give much better results.”
He felt certain that the “event” – a grey swan, or predictable catastrophe triggered by our enemies, Mother Nature, or just by accident –was inevitable. He had done a Swot analysis – strengths, weaknesses, opportunities and threats – and concluded that preparing for calamity required us to take the very same measures as trying to prevent one. “By coincidence,” he explained, “I am setting up a series of safe haven farms in the NYC area. These are designed to best handle an ‘event’ and also benefit society as semi-organic farms. Both within three hours’ drive from the city – close enough to get there when it happens.”
Amazon boss Jeff Bezos has been among the tech barons leading the privatised race into space. Photograph: Joe Skipper/Reuters
Here was a prepper with security clearance, field experience and food sustainability expertise. He believed the best way to cope with the impending disaster was to change the way we treat one another, the economy, and the planet right now – while also developing a network of secret, totally self-sufficient residential farm communities for millionaires, guarded by Navy Seals armed to the teeth.
JC is currently developing two farms as part of his safe haven project. Farm one, outside Princeton, is his show model and “works well as long as the thin blue line is working”. The second one, somewhere in the Poconos, has to remain a secret. “The fewer people who know the locations, the better,” he explained, along with a link to the Twilight Zone episode in which panicked neighbours break into a family’s bomb shelter during a nuclear scare. “The primary value of safe haven is operational security, nicknamed OpSec by the military. If/when the supply chain breaks, the people will have no food delivered. Covid-19 gave us the wake-up call as people started fighting over toilet paper. When it comes to a shortage of food it will be vicious. That is why those intelligent enough to invest have to be stealthy.”
JC invited me down to New Jersey to see the real thing. “Wear boots,” he said. “The ground is still wet.” Then he asked: “Do you shoot?”
The farm itself was serving as an equestrian centre and tactical training facility in addition to raising goats and chickens. JC showed me how to hold and shoot a Glock at a series of outdoor targets shaped like bad guys, while he grumbled about the way Senator Dianne Feinstein had limited the number of rounds one could legally fit in a magazine for the handgun. JC knew his stuff. I asked him about various combat scenarios. “The only way to protect your family is with a group,” he said. That was really the whole point of his project – to gather a team capable of sheltering in place for a year or more, while also defending itself from those who hadn’t prepared. JC was also hoping to train young farmers in sustainable agriculture, and to secure at least one doctor and dentist for each location.
On the way back to the main building, JC showed me the “layered security” protocols he had learned designing embassy properties: a fence, “no trespassing” signs, guard dogs, surveillance cameras … all meant to discourage violent confrontation. He paused for a minute as he stared down the drive. “Honestly, I am less concerned about gangs with guns than the woman at the end of the driveway holding a baby and asking for food.” He paused, and sighed, “I don’t want to be in that moral dilemma.”
That’s why JC’s real passion wasn’t just to build a few isolated, militarised retreat facilities for millionaires, but to prototype locally owned sustainable farms that can be modelled by others and ultimately help restore regional food security in America. The “just-in-time” delivery system preferred by agricultural conglomerates renders most of the nation vulnerable to a crisis as minor as a power outage or transportation shutdown. Meanwhile, the centralisation of the agricultural industry has left most farms utterly dependent on the same long supply chains as urban consumers. “Most egg farmers can’t even raise chickens,” JC explained as he showed me his henhouses. “They buy chicks. I’ve got roosters.”
JC is no hippy environmentalist but his business model is based in the same communitarian spirit I tried to convey to the billionaires: the way to keep the hungry hordes from storming the gates is by getting them food security now. So for $3m, investors not only get a maximum security compound in which to ride out the coming plague, solar storm, or electric grid collapse. They also get a stake in a potentially profitable network of local farm franchises that could reduce the probability of a catastrophic event in the first place. His business would do its best to ensure there are as few hungry children at the gate as possible when the time comes to lock down.
So far, JC Cole has been unable to convince anyone to invest in American Heritage Farms. That doesn’t mean no one is investing in such schemes. It’s just that the ones that attract more attention and cash don’t generally have these cooperative components. They’re more for people who want to go it alone. Most billionaire preppers don’t want to have to learn to get along with a community of farmers or, worse, spend their winnings funding a national food resilience programme. The mindset that requires safe havens is less concerned with preventing moral dilemmas than simply keeping them out of sight.
Vivos hopes to fit its bunkers with features such as swimming pools and gyms. Photograph: Terravivos
Many of those seriously seeking a safe haven simply hire one of several prepper construction companies to bury a prefab steel-lined bunker somewhere on one of their existing properties. Rising S Company in Texas builds and installs bunkers and tornado shelters for as little as $40,000 for an 8ft by 12ft emergency hideout all the way up to the $8.3m luxury series “Aristocrat”, complete with pool and bowling lane. The enterprise originally catered to families seeking temporary storm shelters, before it went into the long-term apocalypse business. The company logo, complete with three crucifixes, suggests their services are geared more toward Christian evangelist preppers in red-state America than billionaire tech bros playing out sci-fi scenarios.
There’s something much more whimsical about the facilities in which most of the billionaires – or, more accurately, aspiring billionaires – actually invest. A company called Vivos is selling luxury underground apartments in converted cold war munitions storage facilities, missile silos, and other fortified locations around the world. Like miniature Club Med resorts, they offer private suites for individuals or families, and larger common areas with pools, games, movies and dining. Ultra-elite shelters such as the Oppidum in the Czech Republic claim to cater to the billionaire class, and pay more attention to the long-term psychological health of residents. They provide imitation of natural light, such as a pool with a simulated sunlit garden area, a wine vault, and other amenities to make the wealthy feel at home.
On closer analysis, however, the probability of a fortified bunker actually protecting its occupants from the reality of, well, reality, is very slim. For one, the closed ecosystems of underground facilities are preposterously brittle. For example, an indoor, sealed hydroponic garden is vulnerable to contamination. Vertical farms with moisture sensors and computer-controlled irrigation systems look great in business plans and on the rooftops of Bay Area startups; when a palette of topsoil or a row of crops goes wrong, it can simply be pulled and replaced. The hermetically sealed apocalypse “grow room” doesn’t allow for such do-overs.
Just the known unknowns are enough to dash any reasonable hope of survival. But this doesn’t seem to stop wealthy preppers from trying. The New York Times reported that real estate agents specialising in private islands were overwhelmed with inquiries during the Covid-19 pandemic. Prospective clients were even asking about whether there was enough land to do some agriculture in addition to installing a helicopter landing pad. But while a private island may be a good place to wait out a temporary plague, turning it into a self-sufficient, defensible ocean fortress is harder than it sounds. Small islands are utterly dependent on air and sea deliveries for basic staples. Solar panels and water filtration equipment need to be replaced and serviced at regular intervals. The billionaires who reside in such locales are more, not less, dependent on complex supply chains than those of us embedded in industrial civilisation.
Surely the billionaires who brought me out for advice on their exit strategies were aware of these limitations. Could it have all been some sort of game? Five men sitting around a poker table, each wagering his escape plan was best?
But if they were in it just for fun, they wouldn’t have called for me. They would have flown out the author of a zombie apocalypse comic book. If they wanted to test their bunker plans, they’d have hired a security expert from Blackwater or the Pentagon. They seemed to want something more. Their language went far beyond questions of disaster preparedness and verged on politics and philosophy: words such as individuality, sovereignty, governance and autonomy.
That’s because it wasn’t their actual bunker strategies I had been brought out to evaluate so much as the philosophy and mathematics they were using to justify their commitment to escape. They were working out what I’ve come to call the insulation equation: could they earn enough money to insulate themselves from the reality they were creating by earning money in this way? Was there any valid justification for striving to be so successful that they could simply leave the rest of us behind –apocalypse or not?
Or was this really their intention all along? Maybe the apocalypse is less something they’re trying to escape than an excuse to realise The Mindset’s true goal: to rise above mere mortals and execute the ultimate exit strategy.
This is an edited extract from Survival of the Richest by Douglas Rushkoff, published by Scribe.
The European Union’s power sector is a good example of what market fundamentalism has done to electricity networks the world over. With the end of cheap natural gas, retail consumers and businesses are paying the price for their governments’ embrace of a shoddy theory.
The blades of the wind turbines on the mountain range opposite my window are turning especially energetically today. Last night’s storm has abated but high winds continue, contributing extra kilowatts to the electricity grid at precisely zero additional cost (or marginal cost, in the language of the economists). But the people struggling to make ends meet during a dreadful cost-of-living crisis must pay for these kilowatts as if they were produced by the most expensive liquefied natural gas transported to Greece’s shores from Texas. This absurdity, which prevails well beyond Greece and Europe, must end.
The absurdity stems from the delusion that states can simulate a competitive, and thus efficient, electricity market. Because only one electricity cable enters our homes or businesses, leaving matters to the market would lead to a perfect monopoly – an outcome that nobody wants. But governments decided that they could simulate a competitive market to replace the public utilities that used to generate and distribute power. They can’t.1
The European Union’s power sector is a good example of what market fundamentalism has done to electricity networks the world over. The EU obliged its member states to split the electricity grid from the power-generating stations and privatize the power stations to create new firms, which would compete with one another to provide electricity to a new company owning the grid. This company, in turn, would lease its cables to another host of companies that would buy the electricity wholesale and compete among themselves for the retail business of homes and firms. Competition among producers would minimize the wholesale price, while competition among retailers would ensure that final consumers benefit from low prices and high-quality service.
Alas, none of this could be made to work in theory, let alone in practice.
The simulated market faced contradictory imperatives: to ensure a minimum amount of electricity within the grid at every point in time, and to channel investment into green energy. The solution proposed by market fundamentalists was twofold: create another market for permissions to emit greenhouse gases, and introduce marginal-cost pricing, which meant that the wholesale price of every kilowatt should equal that of the costliest kilowatt.
The emission-permit market was meant to motivate electricity producers to shift to less polluting fuels. Unlike a fixed tax, the cost of emitting a ton of carbon dioxide would be determined by the market. In theory, the more industry relied on terrible fuels like lignite, the larger the demand for the EU-issued emission permits. This would drive up their price, strengthening the incentive to switch to natural gas and, ultimately, to renewables.
Marginal-cost pricing was intended to ensure the minimum level of electricity supply, by preventing low-cost producers from undercutting higher-cost power companies. The prices would give low-cost producers enough profits and reasons to invest in cheaper, less polluting energy sources.
To see what the regulators had in mind, consider a hydroelectric power station and a lignite-fired one. The fixed cost of building the hydroelectric station is large but the marginal cost is zero: once water turns its turbine, the next kilowatt the station produces costs nothing. In contrast, the lignite-fired power station is much cheaper to build, but the marginal cost is positive, reflecting the fixed amount of costly lignite per kilowatt produced.
By fixing the price of every kilowatt produced hydroelectrically to be no less than the marginal cost of producing a kilowatt using lignite, the EU wanted to reward the hydroelectric company with a fat profit, which, regulators hoped, would be invested in additional renewable-energy capacity. Meanwhile, the lignite-fueled power station would have next to no profits (as the price would just about cover its marginal costs) and a growing bill for the permits it needed to buy in order to pollute.
But reality was less forgiving than the theory. As the pandemic wreaked havoc on global supply chains, the price of natural gas rose, before trebling after Russia invaded Ukraine. Suddenly, the most polluting fuel (lignite) was not the most expensive, motivating more long-term investment in fossil fuels and infrastructure for LNG. Marginal-cost pricing helped power companies extract huge rents from outraged retail consumers, who realized they were paying much more than the average cost of electricity. Not surprisingly, publics, seeing no benefits – to them or to the environment – from the blades rotating above their heads and spoiling their scenery, turned against wind turbines.
The rise in natural gas prices has exposed the endemic failures that occur when a simulated market is grafted onto a natural monopoly. We have seen it all: How easily producers could collude in fixing the wholesale price. How their obscene profits, especially from renewables, turned citizens against the green transition. How the simulated market regime impeded common procurement that would have alleviated poorer countries’ energy costs. How the retail electricity market became a casino with companies speculating on future electricity prices, profiting during the good times, and demanding state bailouts when their bets turn bad.
It’s time to wind down simulated electricity markets. What we need, instead, are public energy networks in which electricity prices represent average costs plus a small mark-up. We need a carbon tax, whose proceeds must compensate poorer citizens. We need a large-scale Manhattan Project-like investment in the green technologies of the future (such as green hydrogen and large-scale offshore floating windfarms). And, lastly, we need municipally-owned local networks of existing renewables (solar, wind, and batteries) that turn communities into owners, managers, and beneficiaries of the power they need.
The flow of U.S. military supplies through Alexandroupoli has angered Russia and Turkey. Now, firms with ties to Russia and America are competing for control of the port.
ALEXANDROUPOLI, Greece — It is an unlikely geopolitical flash-point: a concrete pier in a little coastal city, barely used a few years ago and still occupied only by sea gulls most of the time.
But the sleepy port of Alexandroupoli in northeastern Greece has taken on a central role in increasing the U.S. military presence in Eastern Europe, with the Pentagon transporting enormous arsenals through here in what it describes as the effort to contain Russian aggression. That flow has angered not only Russia but also neighboring Turkey, underlining how war in Ukraine is reshaping Europe’s economic and diplomatic relationships.
Turkey and Greece are both NATO members, but there is longstanding animosity between them, including conflict over Cyprus and other territorial disputes in the Mediterranean, and Ankara sees a deeper relationship between Athens and Washington as a potential threat.
The spike in military activity has been welcomed by the government of Greece, most of its Balkan neighbors and local residents, who hope that Americans will stimulate the regional economy and provide security amid rising regional tensions.
“We’re a small country,” said Yiannis Kapelas, 53, an Alexandroupoli cafe owner. “It’s a good thing to have a big country to protect us.”
Raising the strategic stakes is the impending sale of the Alexandroupoli port. Four groups of companies are competing to buy a controlling stake — two include American firms, backed by Washington, and two have ties to Russia.
U.S. military operations in Greece have expanded greatly since Russia invaded Ukraine in February, and top officials from Moscow and Ankara have called that a national security threat.
“Against whom were they established?” President Recep Tayyip Erdogan of Turkey said in June, referring to the U.S. military outposts in Greece. “The answer they give is ‘against Russia.’ We don’t buy it.”
While most of NATO has sided emphatically with Ukraine, Mr. Erdogan — always willing to chart a different course — has positioned Turkey as a mediator.
In May, the Greek Foreign Ministry claimed Turkish fighter jets violated the country’s air space over Alexandroupoli, just 11 miles from the Turkish border. The incident unnerved local residents concerned with Turkey’s claims to parts of Greece.
The complex interplay of interests at Alexandroupoli highlights how the war is shifting the strategic focus of Europe to the Black Sea region.
“The Black Sea is back on the global agenda in an unprecedented way,” said Ilian Vassilev, a former Bulgarian ambassador to Moscow who now works as a strategic consultant. “Security in the Black Sea is central to the issue of how you contain and deal with Russia.”
Greece and Russia share deep historical, economic and cultural ties centered on the common Orthodox Christian religion. Greeks are among the few Europeans who largely want to maintain economic ties to Russia, polls show. But the war in Ukraine has badly strained those bonds.
The occupation of Ukrainian lands has struck a chord among Greeks, many of whom see parallels between the imperial rhetoric of President Vladimir V. Putin and the territorial claims of Turkey, whose predecessor, the Ottoman Empire, ruled Greece for centuries. The plight of Ukrainians has also resonated with Greek families whose ancestors fled Turkish pogroms in the early 20th century.
“We know about the pain of refugees,” said Dimosthenis Karavoltsos, an Alexandroupoli taverna waiter. “There was no question in my mind about what side we should be on.”
Greece’s conservative government was one of the first to send military aid to Ukraine, prompting the Kremlin to put it on the list of “unfriendly” nations. Fear of Turkey and solidarity with Ukraine have pushed Athens closer to Washington, and it has granted the United States expanded military access in several locations.
The amount of war matériel moved by the United States through Alexandroupoli jumped nearly 14-fold last year — before the war, but as tensions with Russia mounted — to 3,100 “pieces,” a catchall term used by the Pentagon for all sorts of equipment from tanks to ammunition. It has already matched that figure this year.
U.S. officials say the equipment is destined solely for American military units stationed in Eastern and Northern Europe, not for Ukraine.
The jump in activity is a drastic turnaround for a minor port that stood largely idle for almost a decade, blocked by a sunken barge that the U.S. Navy removed in 2019.
The town’s languid mood is transformed every few months when U.S. warships dock to unload tanks, trucks and artillery. The arrival of hundreds of Americans prompts periodic shortages of eggs and cigarettes, and lines outside tattoo parlors.
Between those bursts of activity, few signs pointed to the city’s new importance. On the beach promenade near the port, couples push strollers, and day trippers, mostly from Turkey, snap selfies under the city’s lighthouse. Civilian shipping remains minimal because of the lack of large cranes, but the Pentagon is installing heavy equipment to handle more cargo.
“What we have done is transform the port into a dynamic military operations hub,” said Andre Cameron, who oversees U.S. military logistics at the port. “Nothing like it has been done here before.”
Local officials said they hoped the military upgrades at the port would attract investments in other industries, turning Alexandroupoli into a trade hub for nearby Bulgaria, Romania and even blockaded Ukraine.
The port’s growing strategic importance has highlighted the Russian ties of two Greek business groups competing to take it over.
One group is led by Ivan Savvidis, a Russian-Greek oligarch who has served in the Russian Parliament and sits on a foreign relations committee advising Mr. Putin. “Greek by birth, Russian by lifestyle, Orthodox by faith,” says a statement on Mr. Savvidis’s website, which features a photo of him with Mr. Putin.
Mr. Savvidis’s bid may be complicated by his ownership of the port of Thessaloniki, Greece’s second largest, which could run afoul of competition laws. His spokesperson declined to comment.
Another bidder, a subsidiary of a Greek conglomerate, Copelouzos Group, is more complex, highlighting Greece’s shifting economic ties.
Copelouzos is the local partner of state-owned Russian gas company, Gazprom, and, in a joint venture called Prometheus Gas, is Greece’s third-largest supplier of natural gas. Copelouzos Group built — and, until 2016, operated — the airport of St. Petersburg.
A diplomatic memo on the group’s founder, Dimitrios Copelouzos, written by the American ambassador to Greece in 2007 and published by WikiLeaks is titled “Gazprom by any other name?”
Mr. Copelouzos’s competitors and detractors claim that these ties make him vulnerable to pressure from Gazprom, compromising the future of Alexandroupoli’s strategic operations.
“There are significant concerns because the situation with Russia can deteriorate,” said John Charalambakis, an owner of BlackSummit Financial Group, an American asset management firm that is competing for control of Alexandroupoli. “The fact that Russia is using energy as a weapon is an important factor.”
Concerns over Mr. Copelouzos’s Russian ties are shared by some members of the U.S. Congress, according to two congressional staff members familiar with the matter. They spoke on condition of anonymity because they were not authorized to speak to the news media.
Copelouzos Group is privately held and does not make public its financial performance but says that its joint venture with Gazprom represents a tiny share of its business portfolio, which spans construction, real estate and energy.
“The group has many cooperations across the world with many companies,” said Ioannis Arapoglou, the Copelouzos Group’s general manager. Prometheus Gas “is just one of those, and a relatively small one for the size of the company.”
He noted that the Copelouzos family is investing in a project to build a liquid natural gas terminal near Alexandroupoli, meant to reduce Balkan reliance on Russian gas by bolstering supplies from the United States.
For his part, Mr. Charalambakis, the American businessman, says his interest in the port began in 2018, when Washington’s ambassador to Greece at the time, Geoffrey Pyatt, told him American companies needed to start competing with Russia and China for influence there.
Washington’s growing attention was highlighted on Wednesday, when Senator Robert Menendez of New Jersey, chairman of the Foreign Relations Committee, made a surprise visit to Alexandroupoli.
Greece has been steadily privatizing strategic assets since its debt crisis begun in 2009. The Thessaloniki port went to Mr. Savvidis; the port of Piraeus, Greece’s largest, to a Chinese state-owned firm.
Mr. Pyatt, who left the post in May, has spoken out frequently in support of the two American bids for Alexandroupoli.
The Copelouzos Group’s shift toward American partners mirrors Greece’s changing economic reality, as the sanctioned and shrinking Russian economy supplies fewer opportunities.
This pragmatic approach is echoed in Alexandroupoli. Local officials and businessmen hope the war in Ukraine and regional tensions will transform the port into an alternative supply route that bypasses the Turkish-controlled straits to the Black Sea.
“Every crisis creates opportunities,” said Konstantinos Chatzikonstantinou, the chief executive of the Alexandroupoli Port Authority.
Known for sporting a leather jacket in meetings with foreign dignitaries during his brief stint as Greece’s finance minister in 2015, Yanis Varoufakis has become a bit of a rebel in economic circles.
A member of Greece’s Hellenic Parliament and founder of the left-wing European Realistic Disobedience Front, or MeRA25 party, Varoufakis hasn’t historically pulled any punches when it comes to his scathing criticism of fellow economists and politicians, and his most recent article is no exception.
Central banks have given corporations a type of “lavish socialism” since the 2008 financial crisis, Varoufakis wrote, while workers have been stuck with “harsh austerity,” and the highest inflation in 40 years is just the latest twist.
A half-century–long power play
The economist’s argument is based on the idea that corporations have led a “half-century–long power play” to boost their stock prices, creating unsustainable business models and fragile global supply chains along the way. But it’s all gone wrong in recent years, and workers have been left to clean up the mess.
Before the great crisis of 2008, he said, U.S. corporations used “pyramids of private money” from cheap and plentiful imports and consistent foreign investment to create a “labyrinth” of global just-in-time supply chains instead of focusing on increasing productivity.
Then, when the 2008 financial crisis hit, the pyramid collapsed and central banks were forced to step in and save the day. Interest rates were slashed to near-zero and many central banks began a somewhat controversial policy known as quantitative easing—which involves central banks buying government bonds and mortgage-backed securities in hopes of increasing the money supply and spurring lending and investment.
But while corporations were being saved by central bank policies and federal government bailouts, workers were left to fend for themselves.
“Governments were cutting public expenditure, jobs, and services. It was nothing short of lavish socialism for capital and harsh austerity for labor,” Varoufakis says. “Wages shrunk, and prices and profits were stagnant, but the price of assets purchased by the rich (and thus their wealth) skyrocketed. Thus…capitalists became both richer and more reliant on central-bank money than ever.”
Wealth “triumphed” in real estate and equity markets in this era of government and central bank support, but Varoufakis says asset prices quickly became divorced from the real economy. Then the pandemic hit, and the flows of cash that had allowed corporations to flourish over the past decade were suddenly redirected to consumers.
“Western governments were forced to channel some of the new rivers of central-bank money to the locked-down masses within economies that, over the decades, had depleted their capacity to produce stuff and were now facing busted supply chains to boot,” he said.
When consumers spent some of the money they were given by the federal government via stimulus checks, suppliers couldn’t keep pace with the new demand, leading inflation to rise—and corporations, the war in Ukraine, and COVID-19 lockdowns only added to the problem.
“Corporations with great paper wealth responded by exploiting their immense market power (yielded by their shrunken productive capacity) to push prices through the roof,” he said.
Still, Varoufakis argued that we aren’t seeing a wage-price spiral in the U.S., where workers asking for pay increases to preserve their income amid inflation end up increasing costs for companies, which in turn increase their prices to compensate. The lack of a wage-price spiral means central banks shouldn’t be asking workers to “take one for the team” and go without wage increases.
“Today, demanding that workers forgo wage gains is absurd. All the evidence suggests that, unlike in the 1970s, wages are rising much more slowly than prices, and yet the increase in prices is not just continuing but accelerating,” Varoufakis said.
Still, the inflation problem means Western governments and central banks are faced with a tough decision, Varoufakis argues: “Push conglomerates and even states into cascading bankruptcies, or allow inflation to go unchecked.”
The economist didn’t describe what he believes central bank officials will choose, but he argued the end results are unlikely to be appealing to the masses.
“So, what happens now? Probably nothing good,” he said. “To stabilize the economy, the authorities first need to end the exorbitant power bestowed upon the very few by a political process of paper wealth and cheap debt creation. But the few will not surrender power without a struggle, even if it means going down in flames with society in tow.”
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