Letter #4: Reopening Pains
Ethiopia v. Ethiopia | Black Capitalists Matter
We may actually be putting the pandemic behind us. The October jobs report was more encouraging than ever, with 531,000 jobs (measured as “total nonfarm payroll enrollment”) added to the market. Shares of “pandemic stocks” are losing significant value1. The $1 trillion infrastructure bill passed the Senate - as usual, with the best parts removed - and is headed to Biden’s desk to be signed into law. Case numbers are down. Society is kind of coming back to normal, and in some ways has actually improved somewhat for average people.
The pandemic destroyed a lot of lives and livelihoods, but has also brought opportunity and record profits. Now, we are reverting back to the mean - but with higher wages (average hourly earnings increased by 11 cents to $30.96), lower unemployment (down to 4.6% from 4.8% the prior month), and record inflation. Labor is gaining leverage against capital. The situation calls for cautious optimism.
The most important indicator that things are coming back is the lifting of the US travel ban for foreign travelers. This is bringing a wave of travelers who have been unable to enter the US for the past 20 months, as well as an increase in hospitality demand and jobs. The flip-side of that - it may also bring a fresh wave of real-estate market activity2 in coastal US cities like New York and Miami. Brace yourselves.
Ethiopia is at war with itself. More accurately, Ethiopia and neighboring Eritrea are at war with Ethiopia’s Tigray region. This is a serious conflict that has already cost thousands of lives. The White House has ordered non-emergency officials to leave the country, and is ready to impose sanctions. Even China and Russia are calling for the conflict to end. Both sides of the conflict are accused of human rights abuses, as is common in war, but it’s not very common for one of the accused to be a Nobel Peace Prize laureate - and a recent one at that. Wondering what’s going on? Here’s some background.
Ethiopia has over 80 different ethnic groups. The largest three are Oromo, Amhara, and Tigrinya. Interestingly, Tigray3 people in Ethiopia and neighboring Eritrea, which is majority Tigrinya itself, have the same ethnic roots but different national identities.
Remember Haile Selassie? He was the Emperor of Ethiopia from 1930 to 1974. During World War II he and the Ethiopian people fought an invasion by Mussolini’s Fascist Italy while the West sort of just shrugged. Does the name “Rastafari” mean anything to you? That’s based on his pre-royal name: Ras (Prince) Tafari Makonnen. He is also blamed by some for famine in the northern Tigray province, setting in motion a political pattern of repression against Tigray as a region by the central government in Addis Ababa, the capital.
Haile Selassie was eventually overthrown by communists called the Derg in 1974. Then, the Tigray Peoples’ Liberation Front, a rival leftist party based in the Tigray region, joined forces with the Eritrean Peoples’ Liberation Front, and overthrew the Derg and its notorious leader, Mengistu Haile Mariam in 1991 - just kind of a bad year for communism in general. Eritrea got its independence, then in 1998 went back to war with Ethiopia. Meanwhile, the TPLF went on to dominate Ethiopian politics until it was ousted by Abiy Ahmed, Ethiopia’s current Prime Minister4 in 2018. Eritrea and Ethiopia then declared peace, earning Mr. Abiy a Nobel Peace Prize.
Two years later in 2020, the TPLF (whose support is still mostly based in Tigray) is still seizing Ethiopian military bases. Abiy Ahmed responds with military action; the whole thing starts to explode. He joins forces with Eritrea, erstwhile enemy of the late ‘90s. The Nobel Peace Laureate is now at war. He joins a list of people that includes US President Barack Obama and Henry Kissinger.
Black capitalism. What is it good for? To some, absolutely nothing. What’s strange is that most of the criticism comes from the political left. It seems like one of the more stubbornly toxic aspects of the 1960’s counterculture, a sort of childlike naïveté about the power of the Individual to separate oneself completely from a system that they have no control over and were simply born into. Black capitalism is way more politicized than White capitalism, which is of course lovingly just called “capitalism”. It’s the default, right? Well, why?
From this perspective, opposition to capitalism in America is not a product of genuine egalitarianism, as is claimed - rather, it’s a psychological deflection tactic; a way for the richest people and nation on earth to absolve themselves of guilt over the massive acts of theft and murder that inaugurated the industrial age. The truth is, money is not inherently good or bad. It’s just liquid power. American history is full of examples of the racially-selective eradication of capitalism. The whole racist watermelon trope was originally a marketing campaign against buying from Black-owned watermelon stands. It turns out, Black people with money are considered a threat at times.
Black capitalism is so dangerous, White people would rather burn down half of Tulsa than see it thrive. Wild. There is, to us, a direct line between that history and the racially-insensitive “anti-capitalism” that seems to always harm the small businesses most, which just happen to be what the majority of Black-owned businesses are.
No illusions here. Capitalism is a tool; and a very effective one at that. We’re not just talking about consumerism either - Black people need better representation among manufacturers, logistics, finance and other key parts of the IRL economy. White American leftists are, in a real way, continuing the hateful spirit of their forefathers who bombed Black neighborhoods when they started getting too wealthy. When they can convince the conservative rural Whites to adopt socialism, maybe then they’ll be taken seriously when telling us not to make money because capitalism is evil.
You don’t have to fetishize capitalism or see it as a silver bullet - it’s not. And we may want to practice it differently, or not at all, but either way it requires ideological space and freedom from White-dominated political parties and D/R partisan culture war. Uniquely Black economic and political needs have no direct representation in American electoral politics, which is why they always come last on the policy agenda, if at all. Black people are the last ones who should feel ashamed of making some money and lifting themselves out of poverty. But capitalism won’t work for everyone - there is no pre-packaged ideological solution here, as the world is interconnected. That said, building Black wealth will never be stigmatized ‘round these parts. Go buy that real estate, you deserve it. Especially if it’s an old Southern plantation.
Also Worth Reading
Dur Dur Band’s “Volume 1, Volume 2 & Previously Unreleased Tracks” is Somali funk par excellence. We’ve had this on repeat for a while. Indescribably good. Many of the musicians from this scene were victims of the wars in the Horn of Africa during the 70s, 80s and 90s. Culture is always the first victim of war. (Vinyl / Spotify)
T.P. Orchestre Poly-Rythmo’s “The Kings of Benin Urban Groove 1972-80” sounds like it was pulled straight out of a Blaxploitation film. Other songs are very classically Afrobeat. There are some incredible solos on this one as well. (Spotify / Apple)
Asnaké Gèbrèyès’ “Ahadu” is on the smoother side. It’s rich in musical texture and has the signature Ethiopian jazz sound. Ethiopia is the birthplace of coffee, so it’s only fitting to play this while drinking your morning brew. (Spotify / Apple)
May there be peace on the whole continent.
Disclosure: The editor of this newsletter has investments in PTON, and was negatively impacted by Thursday’s earnings news.
Disclosure: The editor of this newsletter has investments in residential real estate, and is positively impacted by housing price appreciation.
The word “Tigrayan” is incorrect.
Ethiopia also has a President whose role is strictly ceremonial. All powers as head of government reside with the PM. Similar to Germany, except it’s the Chancellor who has the power viz. the President.