Below is an important recent interview with Professor Michael Hudson hosted by Steve Grumbine of Real Progressives and the Macro & Cheese podcast. The interview was published on October 03, 2020.
You can listen to the interview (or download the file to listen anywhere) by using the embedded player below or by going to the following link: https://podcasts.bcast.fm/e/mn4p5mrn
You can also find a fairly accurate transcription of the conversation on the Macro & Cheese website here, as well as at Michael Hudson's website here.
This interview with Professor Hudson touches upon a number of important subjects, all of which are extremely relevant and timely, and upon which I may have occasion to comment further in future posts and videos, but for today I would like to point out in particular a statement which can be found at approximately 31:15 in the conversation.
Framing the economic struggle of the past 250 years primarily as a struggle against feudalism, and noting that modern forms of feudalism have been increasingly successful against those forces which in previous centuries were making progress in dismantling feudalism, Professor Hudson explains that many of the productive sectors of the economy (talking in particular about the US economy but by extension other western economies which have been captured by the same neoliberal system which prevails in Europe and in the British Commonwealth nations) are shrinking (or being deliberately dismantled) even as this shrinkage is being masked by economic metrics (such as GDP) which categorize counterproductive "rent-seeking" activity (neo-feudal activity) as positive instead of destructive.
The rise of neo-feudalism means that for the majority of the population, larger and larger portions of their income is beholden to the banks (in the form of debt service) and to monopolies (including privatized services which should be provided by the public sector), creating a situation akin to the serfdom of the medieval period in which all the produce of one's labor (beyond a meager amount sufficient for nothing more than subsistence living) was coughed up to the landlord.
Beginning at about 31:15 in the interview, Professor Hudson declares:
The 90% knows that they're in trouble. That's why they take tranquilizers. They know that they're being squeezed. They know that it's harder and harder to pay the rent. They know that their debts in arrears are mounting up. But they blame themselves -- they don't blame the system. And so what you need is a reality-based economics, that shows them that the problem is in the system: not in themselves.
The dynamic that Professor Hudson is expounding in this short quotation is extremely important to understand, and should not be lightly passed over or dismissed. What he is describing is the tendency (reinforced by certain dogmas which are propagated within the present culture) to assign blame for economic distress to the victim of a system which is in fact deliberately designed to create economic distress, largely by trapping men and women in debt, which benefits the private institutions which have been granted a monopoly on the creation of credit: namely, banks.
The dynamic by which traumatized individuals shift blame to themselves is described by Dr. Laurence Heller (the originator of the NARM model of therapy, which stands for the "NeuroAffective Relationship Model") in an interview conducted by Sarah Buino with Dr. Heller and Dr. Gabor Mate on the Transforming Trauma podcast:
In that interview, beginning at about 07:52, Dr. Mate explains that, because the essential definition of trauma is a disconnect from one's Self, a traumatized individual actually blames and attacks himself or herself, saying: "People who are traumatized, whether you call it 'shock trauma' or 'developmental trauma' -- they have a negative view of themselves: and so they keep attacking themselves."
Adding to our understanding of this dynamic of turning against the Self, Dr. Heller says (beginning at about 08:26 in the interview):
Part of the child's adaptation to trauma is to turn against the Self. It distorts their sense of Self. [. . .] At one stage there is the splitting -- [. . .] basically what that means is that the child splits the parental image into the 'Good Parent' and the 'Bad Parent,' and the self-image into the 'Good Self' and the 'Bad Self.' They identify with the Bad Self in order to protect the image of the parent -- which is more than just an image: it means they're really protecting that there's still the possibility of love in the universe. And so there's a lot invested in seeing the parent as good and them as bad -- because if they're bad, they can make themselves better, or at least they have this idea they can make themselves better, and win love. And they do that, unfortunately, this is part of the paradox, by giving up and disconnecting from parts of themselves -- the parts that they think are going to be welcomed. So it brings this basic paradox into play.
Dr. Mate presents his explanation of the same phenomenon (beginning at 10:40):
That's exactly what I get people to, is: OK, you're a kid, and you're three years old, and your father was yelling at your mother. Which is safer for you to believe: that your parents are bad, and they don't love you? Or that they're incompetent, and the world isn't safe? Or is it safer for you to believe that there's something wrong with you? That you're not good enough, and that you're to be ashamed of? Obviously, it's unendurable for the child to even entertain the first hypothesis. It's much safer to turn on themselves, and then hope to change themselves, but still believe that, 'If I'm good enough, I'll be loved.'
This interchange powerfully expounds the mechanism by which trauma causes us to turn against our own Self, and to separate from the Self. And it can also be seen to be at play in what we might call the "economic trauma" being described by Professor Michael Hudson in the more recent interview cited above, by which those who are the primary victims of the growing economic neo-feudalism blame themselves rather than the system that is systematically and deliberately burdening them with greater and greater loads of debt (in order to benefit those in position to be creditors).
It is actually more difficult to face the fact that, as Dr. Mate says above, "the world is not safe" and that the system is actually bad, and predatory, than to believe that there is something wrong with the victims of that system, and that it is their own fault for the situation in which they find themselves.
The economic trauma that Professor Hudson describes has been on the ascendency since the 1980s, and it is accelerating.
This system of economic trauma is beneficial to creditors, and to industries positioned to collect what the classical economists described as economic rents: landlords and the real estate sector, the financial sector, insurers, and monopolies (including privatized healthcare -- since no one can do without healthcare if they are in need of medical treatment -- as well as privatized infrastructure including higher education and prisons and the infrastructure of modern communication which includes most of the "tech" sector, and which depends upon the electromagnetic spectrum which should be understood to be part of the public domain).
But the system is profoundly detrimental to those who are not included in the above categories. They look at what is going on and, following a dynamic very similar to that described by Dr. Heller and Dr. Mate in the quotations cited above, find it less threatening to blame themselves than to admit that the economic system as it is structured today has been captured by rent-seekers -- to perceive that in actual fact, the concerted efforts of the classical economists of the eighteenth and nineteenth centuries to dismantle the structures of feudalism have been almost entirely reversed during the course of the twentieth century, and that the forces of neo-feudalism (which stand squarely against democracy) are now accelerating.
And so we can see that what is being described by Professor Hudson, in which men and women have not been taught anything at all about the struggle of the classical economists against the structures of rent-seeking and feudalism, and have not been taught anything at all against the backlash against those classical reformers by the forces of neo-feudalism, is a form of economic trauma, in which the people "blame themselves -- they don't blame the system."
And it is obviously very beneficial for those who want to perpetuate this system of economic rents to keep people in a state of trauma, in which they blame themselves, rather than seeking systemic change.
I would argue that this pattern has been going on for a very long time -- in fact, since the imposition of the original feudal system upon the people of Europe, following the dismantling of the ancient world and the overthrow of the ancient wisdom by literalist Christianity, during the fourth century (AD) and following.
I would highly recommend everyone listen very carefully to the entire interview with Professor Hudson, embedded above. In fact, it is worth multiple listens, because the concepts expressed in that interview are concepts we don't hear explained very often, and it can take hearing them a few times in order to absorb the full impact of what he is saying.