Orwell Targets Bernanke: An Unteachable Hole in the Air (Part Two of Two)

George Orwell wrote about “[t]his lunatic world in which opposites are turned into one another.” That was not lunacy for lunacy’s sake, nor is it today.

In 1940, Orwell wrote of World War II: “After 1936, of course, the thing was obvious to anyone except an idiot.” He was not erasing his own past, as was common with many others and is universal among “experts” today. (See the first paragraph of Ben Bernanke’s October 15, 2010, speech.) In 1938, upon returning to England from continental Europe, Orwell had written about the “familiar streets, the posters telling of cricket matches and Royal weddings, the men in bowler hats, the pigeons in Trafalgar Square, the red busses the blue policemen – all sleeping the deep, deep sleep of England, from which I sometimes fear that we shall never wake till we are jerked out of it by the roar of bombs.” The bombs flattened London in 1940.

The British institutions in the 1930s were in the same condition that the Federal Reserve, other government manipulators, the so-called economics profession, and the revered think tanks are in today. Orwell wrote of Neville Chamberlain, British Prime Minister from 1937 to 1940: “He was merely a stupid old man doing his best according to his very dim lights. It is difficult otherwise to explain the contradictions of his policy, his failure to grasp any of the courses that were open to him. Like the mass of the people, he did not want to pay the price either of peace or of war. ” At another point: “Tossed to and fro between their incomes and their principles, it was impossible that men like Chamberlain should do anything but make the worst of both worlds.”

This is an apt summation of the desiccated American hierarchy today. It is withering into dust.

Chamberlain had trusted Hitler, as had his predecessor, Stanley Baldwin. As prime minister, Baldwin had suppressed information about Hitler’s rearmament, sleeping, as was his wish, the deep, deep sleep of England. Orwell wrote: “One could not even dignify [Baldwin] with the name of stuffed shirt. He was simply a hole in the air.” Baldwin did everything he could to prevent any disruption to the exact relations that existed among the social and political institutions of the day.

Winston Churchill, not in office but a nuisance to the established order, knew the proportions of Nazi rearmament and gave speeches in Parliament with uncomfortable details. Baldwin’s cabinet voted to ban “independent views” from the BBC. Sir John Reith, dictator of the BBC, prevented Churchill from speaking. CNBC does much the same today, as does the print media.

Geoffrey Dawson, editor of The Times of London, suppressed Churchill’s views as well as those from Times reporters whose dispatches from Europe might upset Hitler. In 1935, Dawson wrote, “I do my utmost, night after night, to keep out of the paper anything that might hurt their [Nazi] susceptibilities.” He wrote this letter because he could not understand the Fuhrer’s ingratitude after, in the words of William Manchester, “five years of jumping through Hitler’s hoops.”

Dawson was not a Nazi but a dense, frightened old man who wanted the world to stand still. We can see the same combinations of dis-enlightenment that keep the American public in the dark today. An example is the coordination among government agencies (their data dissemination propaganda) and the Federal Reserve’s contorted views as expressed through the country’s news collection agencies.

The Associated Press released the following on October 14, 2010, a day ahead of Bernanke’s speech:

Wholesale prices tame beyond volatile food, energy

(AP) “Wholesale inflation stayed tame last month outside of a sharp rise in food and energy prices. Moderate price inflation allows the Federal Reserve to keep the short-term interest rate it controls at a record low of nearly zero, where it has been since December 2008.”

With that, the AP assured its access to the Fed chairman.

In 1952, Bernard Iddings Bell wrote Crowd Culture, in which he discussed a wartime incident: “When Russia was Hitler’s ally in World War II, the American people were told by the papers, and believed, that the Russians were little short of fiends. Suddenly Russia changed sides…. [S]he became our ally. At a dinner in New York at that time, I sat next to a high-up officer of one of the great news-collecting agencies. ‘I suppose,’ I ventured, ‘now that the Muscovites are on our side, the American people will have to be indoctrinated so as to stop thinking of them as devils and begin to regard them as noble fellows.’ ‘Of course,’ he replied. ‘We know what our job is in respect to that. We in the working press will bring about a complete and almost unanimous volte face in the belief of the Common Man about the Russians. We shall do it in three weeks.’ He was right about it. The papers, fed by the news agencies, did just that.”

On March 29, 1943, Life magazine published a “Special Issue USSR.” On the front cover is a portrait of Uncle Joe Stalin, beaming downward, as if the dictator is looking upon his 3-year-old nephew who just counted to 10 for the first time. Over 100 pages of the issue describe the Soviet Union’s wholesome leaders and their obliging peasantry.

Among the wholesome leaders is Vladimir Ilyich Ulyanov (Lenin), with a similar, avuncular portrait, as if he’s looking at the same nephew who just counted to 20. The article, “The Father of Modern Russia,” starts off “Perhaps the greatest man of modern times was Vladimir IIyich Ulyanov.” It goes uphill – or downhill – from there, depending on one’s view.

Flipping through the issue, the article “Collective Farms Feed the Nation” is worth a look. Pictures of the peasants are inspiring. They were a happy lot. The story starts off: “Although Russia was always overwhelmingly an agricultural country, most Russians used to go hungry.” Later in article: “Whatever the cost of farm collectivization, in terms of human life and individual liberty, the historic fact is it worked.” The cost of farm collectivization included several million Ukrainians who had been starved to death in the early-1930s.

“Collective Farms” could be written by an economist – then or now – without irony or conscience. Such a contortion of reality would do wonders for a rising academic or Federal Reserve staffer.

Orwell was harsh in his criticism of the intelligentsia, whose loyalties were as fickle as their abstractions. He did not confuse the term, intelligentsia, with intelligence. It was a collection of layabouts who, in a “desire for psychological escape” indulge in “chauvinistic sentiments that would be totally impossible if you recognized them for what they were.” Such a person is “capable of the most flagrant dishonesty, but also – since he is conscious of serving something bigger than himself – unshakably certain of being right.”

In their world: “Material facts are suppressed, dates altered, quotations removed from their context and doctored to alter their meaning.” Communism was an outpost for many of the intelligentsia in the 1930s. John Reed, author of Ten Days That Shook the World, (about the Russian Revolution), had willed the publication rights of his book to the British Communist Party. Reed died in 1920. The British Communist Party did exactly what Moscow wanted: it published an edition that excised Leon Trotsky’s role in the revolution and deleted an introduction by Lenin.

Orwell wrote: “Events which, it is felt, ought not to have happened are left unmentioned, and ultimately denied.” British Communists were badly shaken by the Russo-Nazi pact (Molotov-Ribbentrop) in 1939, an eventuality not difficult to forecast by a party whose subservience to Moscow should have animated its consciousness towards Russian self-interest.

Bernanke, the Fed, and the other weary institutions fall within Orwell’s description of Chamberlain and his circle: “What is to be expected of them is not treachery or physical cowardice, but stupidity, unconscious sabotage, an infallible instinct for doing the wrong thing. They are not wicked, or not altogether wicked; they are merely unteachable. Only when their money and power are gone will the younger among them begin to grasp what century they are living in.”

Of Bernanke today, he is a combination of both the establishment and the regimented intelligentsia that has acquired power. Orwell wrote of the intelligentsia: “Clearly there was only one escape for them – into stupidity. They could keep society in its existing shape only by being unable to grasp that any improvement was necessary” After a time, which looks like it will be after Bernanke and his comrades have done their worst, a leader, looking at the world as it is, may state:

“Difficulties began to build up in the economy in the 1970s, with the rates of economic growth declining visibly…. A lag ensued in the material base of science and education, health protection, culture and everyday services. Though efforts have been made of late, we have not succeeded in fully remedying the situation. There are serious lags…in the improvement of the people’s standard of living.”

Thus spoke Mikhail Gorbachev in his 1986 speech to the 27th Communist Party Congress when he effectively declared the institutions which had colluded to bankrupt the nation’s economy and spirit were dead.


Frederick Sheehan,
for The Daily Reckoning

[For more of Frederick Sheehan’s perspective you can visit his blogs here and at www.AuContrarian.com. You can also purchase his book, Panderer to Power: The Untold Story of How Alan Greenspan Enriched Wall Street and Left a Legacy of Recession (McGraw-Hill, 2009), here.]