Sunday, July 18, 2010

Knowledge-base Tool Kit: More on Social Positioning

Just another motoring report of an exclusive car, or is there more to it than meets the eye? As an illustrative example of how the aforementioned manipulation of the wage workforce by corporations and the plutocrats is at work, i.e. mass lay-offs so as to bring down wages and raise productivity with slimmer workforces [see the topic: Knowledge-base Tool Kit: Social Bargaining positions], the following came to attention...

High (volume) Roller Rolls-Royce is on something of a...roll, with remarkable growth in many markets and all its designated models sold out until September.

Production at the firm's Goodwood plant in Wessex, England, has reached record levels on the back of strong customer demand. June was a particularly strong month with sales improving more than four-fold compared to last year

In addition, the firm manufactured 300 units in June alone with 15 cars, including the Phantom and Ghost models, rolling off the production line each day. To put this into context, the company's contingent of Phantom saloons is sold out until October.

Torsten Müller-Ötvös, CEO, Rolls-Royce Motor Cars, said, "This is an excellent interim result and we are well on our way to meeting our target of at least doubling our 2009 sales result. At the same time, both Phantom and Ghost continue to be the most exclusive super luxury cars in the world." 

He continued, "I am also delighted with the progress in one of my first tasks as CEO - the stabilisation of the production process for our new model series, Ghost - and this is reflected in the smooth delivery of cars to our dealers and our customers around the world." - Car Magazine, South Africa, July 8th, 2010.

This is interesting since it is hardly something that any average person will necessarily read much into, beyond what is being reported. However trifling it may appear at first sight, it is but a piece of the larger picture of a phenomenon wherein the thin layers of the rich are sharply getting richer in this extraordinary global economic melt down, as the living standards of wage-folks progressively goes down, and as the gap between the rich and the poor widens.Perhaps the IOL motoring piece was more forthright in making a link between the luxury mark and recession:

Recession, what recession? Rolls-Royce production has reached record levels - 15 cars a day, 300 during June - but all its production is sold up to September 2010.Unless you want a Phantom sedan, in which case your name will go down on the list for November.

Sales in June 2010 increased more than fourfold worldwide and in the first half of the year were almost double the same periods in 2009 with particularly strong performances in the Australia-Pacific region, especially China.

Roll-Royce CEO Torsten Muller-Otvos said: "We're well on our way to meeting our target of doubling our 2009 sales but, at the same time, the Phantom and Ghost continue to be the most exclusive super-luxury cars in the world."

Director of production Jorg Bause added: "Everybody here has risen to the challenge of meeting unprecedented demand."
- IOL motoring, Jan 9th, 2010.

The above-mentioned "remarkable growth" in "many" markets around the world to the point wherein the "demand" for the most exclusive super-luxury mark reaches "unprecedented" levels, concurrently with the obscene profit accumulation by the financial oligarchy during a time of deep economic recession, is not of happenstance. It is an expression of the spending spree that is accommodating fat paychecks the rich few have been getting lately, primarily through market-speculation and bailout money handed out by governments at the expense of the ordinary working public of course, as a token or celebration of their latest gains in wealth. The near total deregulation of markets has provided unfettered and lopsided flow of capital unto the thin layer of plutocrats from the wider sections of society. Naturally, the "most exclusive super-luxury" Rolls Royce products are not going to be vulnerable to the shrinking consumptive power of the wage-workforce, as that is not where its target market lies; its target market are those very plutocrat fat cats who spurred the economic catastrophe that paved way for the ongoing global economic recession, and who have been "bailed out" with public money.

The market for such exclusive "super-luxury" items have thus experienced "remarkable growth", while lower-end vehicle markets havesave for the brief post-"Cash for Clunkers" jump in sales primarily due to a momentary surge in businesses and rental concerns acquiring new company vehiclesbeen struggling with invigorating their shrinking customer base, as have/are other business that rely on mass consumption rather than narrower exclusive markets. Furthermore, the emergence of new multi-millionaires and billionaires in the so-called "Emerging markets" and the likes of China [and indeed, China is particularly noted in the IOL piece]—adding to the existing ones in the established "wealthy" marketshas only expanded the market of exclusive "super-luxury" marks like BMW's Rolls Royce Ghost and Phantom models, as the wealthy newbies too seek to show off their new financial gains. In summation, the condition of Rolls Royce availability being outstripped by demand and its sudden turn into a "high volume" model [reaching "record levels"] during deep recessionas jubilantly characterized in the Car Magazine and IOL pieces aboveis not all that surprising, when it is understood that this global economic slowdown may be a recession for the wage-worker but it is certainly a boom for the Wall-Streets of the world!

On a final note, there persists a perception out there that nations' economic growth, as reflected in such indicators as the GDP, is a measure of wealth growth across a wide layer of societies involved, but reality on the ground paints a very different picture. As the above Rolls Royce matter demonstrates [albeit in that case, the temporal context is one of deep recession], the plutocrats are the prime beneficiaries of such new found wealth. Perhaps China's situation serves as an ample demonstration of the paradoxical relationship between economic growth and the living conditions of the wider layer of most societies...

The global financial crisis that erupted in 2008 has only served to underscore the vulnerability of the US and the rise of Chinese capitalism. While the US and European economies contracted in 2009, China contributed more than 50 percent of global economic growth. Last year China overtook Germany to become the world’s largest exporter. While major Western banks had to be bailed out, the seven largest Asian economies now hold $US4.6 trillion in foreign currency reserves—greater than the rest of the world combined...

Today’s tensions are compounded by the fact that no country is in a position to play the role that the US did in creating a new equilibrium after World War II. China is an economic giant with feet of clay, riven by economic and social contradictions. Its economy is dependent on Western investment, technology and markets. China’s great economic “strength”—its vast pool of cheap labour—inevitably produces deep-seated social tensions. While its GDP is set to become second in the world, its per capita GDP was just $3,259 in 2008, 104th in the world, behind Iraq, Georgia and the Republic of Congo. It has the second largest group of dollar billionaires in the world behind the US, yet 150 million people live on $US1 or less a day. The abiding fear of the tiny Chinese elite is that its police-state measures will not contain the immense social explosion that is building up.
- John Chan, courtesy of, US-China rivalry intensifies, 2010.

China's per capita GDP just two years ago is said to have been below those of even war-torn regions of Iraq and Congo! A large segment of its population "live on a dollar or less a day", this notwithstanding that "it has the second largest group of billionaires". Similar contradictions to varying degrees can be demonstrated for "established economies" of the so-called "West" and the Pacific, and certainly so for African economies which have seen economic growth while other economies elsewhere stagnated in this global economic slowdown.

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