Technological Advances and the Great Recession


A big deal of fixes has being tried and many have failed until now in order to restore the global economy to its previous growth, or at least to prevent further downslide. Nevertheless, few people stop to wonder and figure out what may be the causes of the current mess the global economy is facing. Causes, it’s basic to diagnosis and possible remedies. That happens in medicine but also in economics. Politicians work for corporations one way or the other and we (all of us) are inclined to think in a very tiny small scale: from local to regional, to national and the latest priority is to think globally about any sort of problems we face. And here I believe starts the problems: local politicians will not think globally while this crisis is global and the causes are not only a bunch of smart asses in Wall Street or the City of London who brought it about. No, it was the near light speed technological advances that produced the means to such a crisis reach these proportions.

Wall Street

Wall Mean Street


Big deeds transformed in catastrophic changes. The U.S. ignorant elite and its artificial system of values have broken the balance that was their own source of power: created money out of thin air and sold to themselves, the whole world and to the Chinese. The A.I.G. failure had to be solved otherwise would be a real “meltdown of the system” simply because the Chinese could see it as a declaration of war on their trust in the American values, read it as the “Dollar” itself and dump it in favor of its own currency sinking the U.S. and Europe in a depression that 1929 would appear a nice time. It would be real time selling orders to obedient servers instead of human brokers. Selling “values” that only exist in the book, better said, in bits and bytes.

Beside the fact of the fraudulent behavior of the big financial markets all over the place, technology and digital production has shifted the balance in values, production of values and reproduction of wealth. Globally without exceptions. Banking and brokerage are now I.T. programs and are widespread used to the mid to upper classes.

Silicon Valley

The map of the gold mine

The Western countries produce high-end technology innovation but at such a high price that the rest of the world is not willing to pay for it but is applying the oldest rule of humanity since the discovery of fire: to steal what you do not have and use it for your own benefit. India started being a Call Center depository for the Anglo-Saxon world and today has a huge technological park in development. Silicon Valley is full of Indians who “work” there. But when the big money in India calls them back usually they do go back. How come that? In order to earn pennies instead of dollars per hour for highly skilled work? My guess is that the causes are more profound them that. And then we have to deal with a phenomenal brain power called Russia and the old Soviet satellites. What about them? Armies of engineers and math scientists formed and updated continuously on the top of the line of digital production, theft and piracy (considering the still valid rules of copyright). There are assessments of Western secret services that rank the number of industrial spies from Russia, India and China in the West today above any number ever during the cold war. Because those are the hot processors, high speed connections re-routing the center of gravity of the production of wealth in the making. Nobody is willing to lose a minute in the fast paced new world of the digital replication.

The rest of the world will infringe copyright in every single way it can. China copies absolutely everything its commanders decide is strategic to their country and contaminates the environment without a single flaw in its consciousness simply because they have to reach where the West reached too many years before. Brazil offers raw material to the Chinese who use it to produce goods for the whole world. It also feeds them even if for that the Amazon basin will have to disappear. In the BRICs (Brazil, Russia, India and China) and other peripheral countries few, very few people care about copyright laws, environment destruction and climate change. They want the “good life” Hollywood served them in the screens for a whole century (copyright protected) and they could only dream of it. Now, they can grab a piece for themselves and as humans, will steal and kill for that torch of fire that will cook the hunted veal as in the pre-history.
When Wall Street greedy men defrauded the trust in the financial system, they did it out of greed of course, but also out of ignorance without seeing far enough, not so far really, that their system is never ever again to be trusted. People talk about the destruction of the Euro and the end of the Dollar as reference currency. But have you heard anyone talking about the end of the Rubble, the Yuan or the Brazilian Real lately? Let me know where if you did, please!

Karl Marx was wrong in too many things but so was Thomas Jefferson (slaves’ owner for example) but he has said something irrefutable: “change the means of production and you change the ways of relationships.” And that is what happened: the high-end technology and the Information Society liberated forces that permeated the whole human society, from Patagonia to Bhutan, passing by England, Bombay and Jakarta. Mass media is strong still but the great infusion of free information brought about thru digital connections has made an impact that is still early to predict but certainly inevitable to occur. Washington D.C. cannot order the bombardment of Beijing because it infringes copyright materials, neither with Russia or India. A boycott against Brazil would meet an ex-guerrilla woman president that would not doubt to halt the exports exploding commodities prices and to search protection with China and Russia if need be. The “empire” is deadly sick and under internal convulsions. The silly right-wingers in the U.S. believe that the crisis will go away, somehow, when they grab the power again. I’m afraid it won’t and the world as we knew before this crisis will never return to be what it was.

Chinese Dragon after US bombardment

Parallel worlds (virtual and real) have emerged alongside governments and corporations that can be challenged by rivals in order to gain weight in the economical shift and are bound to do so. The new division is more likely to be: “I will take what I need and you cannot stop me at all”. The original “owners” surrendering under the evidence of fatality. First World unemployment is to remain high because a huge mass of laborers are not necessary anymore: machinery is highly efficient, automated and don’t complain. Emerging countries will continue to grow in spite of threat of the IMF that it is another “bubble”. It’s not! They have people, billions to serve and work cheap under inhuman conditions. As far their commanders and bosses allow some circus at the end of the day (entertainment “pirated” from the U.S. for instance); some days a year of vacation and meat, vitamins and everyday starch ration for basic energy they will continue to move on. The poor don’t care for the environment neither for international agreements on whatever subject, they care for food and expect the little pleasures that sort of development is making available to them. The rest is still to be written…

What is the price of his head?

And it is being written as I write: Wikileaks from Assange is wracking the American diplomatic world… That would not be possible without the new technologies in place. And by the way, everybody spies everybody; it’s a game from pre-historical roots. What is the big deal then?

But now WikiLeaks plans to release a U.S. bank’s documents
and that will be really dangerous trend to set. Too many disaffection and plenty of “vendetta’s” will start and nothing will be the same again.

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Empowered kids: a whole new picture


Just a quick look at the new picture in the making in Uruguay since a couple of years and now in full course of action. The One Laptop Per Child (OLPC) initiative has implemented with the support of the left wing government of Uruguay the first worldwide experience of covering the whole population of children in the public elementary school with one laptop each.

When we consider the effects that this action can produce to the new generation, it is simply mind blowing. First of all, it tears apart the main blockage to equality in a society which is access to information restricted to who can afford it. It makes me curious to check what will be the scores of these students compared with the previous generations and compared also with the kids who have no access to these tools.

Since Mr. Nicholas Negroponte presented the programme, I have to say that my first reaction was pretty cold given the usual lack of initiatives of all governments regarding to education and mainly if these efforts are targeted towards the lower social classes. However, Mr. Vázquez (Uruguay’s President) took it seriously and the country mobilized towards the goal and they have accomplished the first objective: saturation of the young population with ownership of the small, cheap but effective first laptop with total connectivity, built-in multimedia applications, running XO operating system.

This video can give a first impression of the early consequences of these brave and absolutely necessary step towards a truly knowledge based society.

These kids will be able to truly turn the country’s reality upside down in less than a decade. Children are competitive by nature; we all were there once upon a time. Considering that they will be empowered to reach virtually all sorts of information and form themselves (with teachers consequently having to readjust their roles or be surpassed by the pupils), it is not far fetched to foresee these kids forming a massive pool of creation. They are already manipulating photos, making small video clips, forming networks. They become active actors of their own lives and the questioning of power of knowledge will need to be revaluated. How will adults impose criteria over younger generations if they don’t have the same knowledge as they do?

No matter what comes along, the main point is that the tools are given and that is the right sort of subsidy a state has the duty to provide to its people: access to knowledge and freedom to be creative.

Until "revolution" arrives…the paradise of subsidies


As I said clearly before I don’t believe in any revolution let alone in the global kingdom of inflated egos. It is not the nature of the beast to eat its own guts and everybody can rest in peace about it: filmmakers, actors, producers and all the involved in the entertainment business won’t suicide as they see revenues dropping and sinking bellow the red mark, way bellow. At least in all the countries where subsidies are in place, the ball will keeping going. The game is too good to quit and they will fight it fiercely,  with bravery and stop at no ethical limits (the large majority at least) even if that includes censorship.

My intention here is to map as extensively as possible the production of film around the world with a special emphasis over the subsidized countries.  The US has its own set of rules, small state funded incentives, etc.etc. and for the purpose of this series of articles is simply not fun to drag its dirty out yet. Not yet.

BRAZIL

Honoring the country which saw me coming to this world, I shall start with Brazil.  Yeah, I am Brazilian by birth (European National by option). Not equal, nobody in Brazil is born equal to anything (the law? no, specially not equal to the law) … Not easy, in the country easy is seen as weak so everybody poses a nasty attitude to life in general and to their “social-inferior-peers” in particular… AND everybody feels they have the supreme right to have all the benefits in the world, existent and to be invented, on all medias and in the whole universe. To whom is used to the language used in distribution rights contracts, doesn’t it sound terribly familiar?

That said I need to clarify somethings to the newcomers to the “Brazilian kingdom”. The country has a huge media oligopoly in place for the past 44 years called nothing less than GLOBO (globe) which produces an enormous amount of daily soap operas (four hours a day x 4 different shows x 6 days per week) and that is enough to keep an army of combatant soldiers (artists), well paid and living the glory of nationwide fame, happy and smiling all day long. To portrait the whole scenario would take a book and that is not the purpose of these articles so, keeping it short, they can have a mediocre production with some excellent talent but there is a huge fiction-drama production taking place in the country.

The GLOBO organizations (the media empire spreads to cable channels, newspapers, magazines, radio stations, cable networks, music publishing, etc.etc) were raised to a predominant position by the military dictatorship in the 60’s and never declined ever since.  The military regime went down but they kept their stake and pawns over the country, supporting rebrand right-wing politicians in a fake democratic state. Currently they support the center left government of Lula. Even if they say they do not support it, they do. It is their nature: always standing behind the factual powers.  And their dominant position has made that they bred inner-house talent, shaped to their aesthetic standards for generations (not unusual to find three generations of the same family working in the same company’s department) and that has spilled over to several other art forms: the cinema is made by the same actors and a great number of screenwriters and directors; the theatre is dominated by the same actors of the soap-operas; the music heard on the radio waves is the soundtrack of their programming, etc.etc. The “Global Production Standard”  which encompass a standardized mix of key elements such as same lighting, art direction, costume designers, set designers and 99% of poor camera angles composing the lower spectrum of visual (de) effects to keep audiences’ success and with rare exceptions is almost always the certainty of a mediocre product.

To further understand the GLOBO system is necessary to clarify that even the communists and left-wingers were incorporated and assimilated by the predominant standard. Exceptions can be counted within two hands, maximum.

Yet, as an oligopoly there was no need to invest in feature films neither there was a legal obligation to do so, as it is the case in many European countries. When the GLOBO organizations raised Mr. Collor de Mello to the presidency of the nation, he called to an abrupt end of the state funded film organism (Embrafilme) and the small feature film production halted completely. From 1990 to 1994 no long feature film was produced in the country.

The demand for financial instruments able to finance a film industry was always a major drag for the cultural elites and the government had in place an instrument that in fact was quite successful to reach the small goals of those “brilliant minds”: tax exemption for companies investing in film productions. Slowly but surely, the system started to work out.

The basics of it are: a director/writer comes up with a project. Usually they are not alone and have producers attached which will package the project, attach the talent (Globo actors) and register the project with the state organization for clearance (i.e. authorization to raise money). The project is then filed in the Stock Exchange (yeah, never underestimate the capacity for grandeur that the Brazilian elite’s have!) and then out they go for the money hunt. After that, it is all up to the Marketing Manager of big corporations to decide according to their own agenda’s which film to support or not.

BUT, and there is always a big but, the “investing” companies will not invest the so-called “good money”. Nay, nay!!! They will “invest” bad money, rotten money and whatever other disgusting name they come up with in the production of film or theatre or a ballet. It’s the same from the marketing director’s perspective and the money leaves from the same pot: the corporate taxes due to the nation’s Treasure. Needless to say there is no investment whatsoever. They take up to 4% of the corporate due tax and put it in one, two, how many productions they see fit and that amount is levied by the Treasure Department. So, every single production in the country departs fully paid even before pre-production. There is no risk attached to the producers, writers and directors. All salaries paid in full at rates that when compared to the European films are quite high. If a director writes and also produces the film (not unusual at all) the net profit of this “artist” is often 30% of the entire budget. Average budget of Brazilian features? Currently averages US$ 4 million. Some reach 8/10 million US dollars. Basically it’s all ” Global Production Standard” values. Not too different from  watching a soap-opera episode but in the “magical dark room” in a brand new Multiplex Cinemark. Rare exceptions, mediocrity is the standard.

If the film fails flatly in the box office? Who loses it? Nobody. It’s fully paid. Paid by the Brazilian State and ultimately by the Brazilian poor population who does not have health care, nor decent public services let alone the right to complain about another gigantic inequality of the rich up and coming world power player championed by the blue-collar president.

It’s worth to remark that the former Minister of Culture, singer Gilberto Gil, has received also subsidy money shortly after leaving the ministry for more than US$ 200,00 guess for what? To produce his music DVD! If Caetano Veloso wants to make a show with tickets costing US$ 100 per head, he demands subsidies as well. If any problems or complaints arise from the fact that one of the richest singers in the country gets subsidies, he himself will call the seating Minister of Culture and the rules will bend to accomodate his needs.

Is there any strategy in the works regarding the digital “revolution”? Yeah, Walkiria Barbosa, director of Festival do Rio has recently declared that it’s necessary to combine “education + punishment + alternatives”. As an old school Stalinist,  she has it all squared out. She and all the rest! To talk about the real alternatives in Brazil is to cast yourself out of the picture, I know! I’m doing it as I write these pages. Don’t think outside the dark room with a projector running a 35 mm print otherwise you are not cultivated enough at best. If it comes to worst you are a criminal and point period. End of discussion. Someone will find a way to punish you.

AT THE END OF THE DAY, it is an investment, done by a legal entity into another legal entity. If the product is good and has returns, the “investor” will receive the principal plus profits. The taxes the company owed? Forget it, nobody will ever recall that minor detail, for god’s sake!

Woody Allen and Rio

The bad news? It is all reserved to Brazilian nationals but if you are Woody Allen governments will line up to pay for your production. Bastardy is a highly appraised art in the country.

Until “revolution” arrives…the paradise of subsidies


As I said clearly before I don’t believe in any revolution let alone in the global kingdom of inflated egos. It is not the nature of the beast to eat its own guts and everybody can rest in peace about it: filmmakers, actors, producers and all the involved in the entertainment business won’t suicide as they see revenues dropping and sinking bellow the red mark, way bellow. At least in all the countries where subsidies are in place, the ball will keeping going. The game is too good to quit and they will fight it fiercely,  with bravery and stop at no ethical limits (the large majority at least) even if that includes censorship.

My intention here is to map as extensively as possible the production of film around the world with a special emphasis over the subsidized countries.  The US has its own set of rules, small state funded incentives, etc.etc. and for the purpose of this series of articles is simply not fun to drag its dirty out yet. Not yet.

BRAZIL

Honoring the country which saw me coming to this world, I shall start with Brazil.  Yeah, I am Brazilian by birth (European National by option). Not equal, nobody in Brazil is born equal to anything (the law? no, specially not equal to the law) … Not easy, in the country easy is seen as weak so everybody poses a nasty attitude to life in general and to their “social-inferior-peers” in particular… AND everybody feels they have the supreme right to have all the benefits in the world, existent and to be invented, on all medias and in the whole universe. To whom is used to the language used in distribution rights contracts, doesn’t it sound terribly familiar?

That said I need to clarify somethings to the newcomers to the “Brazilian kingdom”. The country has a huge media oligopoly in place for the past 44 years called nothing less than GLOBO (globe) which produces an enormous amount of daily soap operas (four hours a day x 4 different shows x 6 days per week) and that is enough to keep an army of combatant soldiers (artists), well paid and living the glory of nationwide fame, happy and smiling all day long. To portrait the whole scenario would take a book and that is not the purpose of these articles so, keeping it short, they can have a mediocre production with some excellent talent but there is a huge fiction-drama production taking place in the country.

The GLOBO organizations (the media empire spreads to cable channels, newspapers, magazines, radio stations, cable networks, music publishing, etc.etc) were raised to a predominant position by the military dictatorship in the 60’s and never declined ever since.  The military regime went down but they kept their stake and pawns over the country, supporting rebrand right-wing politicians in a fake democratic state. Currently they support the center left government of Lula. Even if they say they do not support it, they do. It is their nature: always standing behind the factual powers.  And their dominant position has made that they bred inner-house talent, shaped to their aesthetic standards for generations (not unusual to find three generations of the same family working in the same company’s department) and that has spilled over to several other art forms: the cinema is made by the same actors and a great number of screenwriters and directors; the theatre is dominated by the same actors of the soap-operas; the music heard on the radio waves is the soundtrack of their programming, etc.etc. The “Global Production Standard”  which encompass a standardized mix of key elements such as same lighting, art direction, costume designers, set designers and 99% of poor camera angles composing the lower spectrum of visual (de) effects to keep audiences’ success and with rare exceptions is almost always the certainty of a mediocre product.

To further understand the GLOBO system is necessary to clarify that even the communists and left-wingers were incorporated and assimilated by the predominant standard. Exceptions can be counted within two hands, maximum.

Yet, as an oligopoly there was no need to invest in feature films neither there was a legal obligation to do so, as it is the case in many European countries. When the GLOBO organizations raised Mr. Collor de Mello to the presidency of the nation, he called to an abrupt end of the state funded film organism (Embrafilme) and the small feature film production halted completely. From 1990 to 1994 no long feature film was produced in the country.

The demand for financial instruments able to finance a film industry was always a major drag for the cultural elites and the government had in place an instrument that in fact was quite successful to reach the small goals of those “brilliant minds”: tax exemption for companies investing in film productions. Slowly but surely, the system started to work out.

The basics of it are: a director/writer comes up with a project. Usually they are not alone and have producers attached which will package the project, attach the talent (Globo actors) and register the project with the state organization for clearance (i.e. authorization to raise money). The project is then filed in the Stock Exchange (yeah, never underestimate the capacity for grandeur that the Brazilian elite’s have!) and then out they go for the money hunt. After that, it is all up to the Marketing Manager of big corporations to decide according to their own agenda’s which film to support or not.

BUT, and there is always a big but, the “investing” companies will not invest the so-called “good money”. Nay, nay!!! They will “invest” bad money, rotten money and whatever other disgusting name they come up with in the production of film or theatre or a ballet. It’s the same from the marketing director’s perspective and the money leaves from the same pot: the corporate taxes due to the nation’s Treasure. Needless to say there is no investment whatsoever. They take up to 4% of the corporate due tax and put it in one, two, how many productions they see fit and that amount is levied by the Treasure Department. So, every single production in the country departs fully paid even before pre-production. There is no risk attached to the producers, writers and directors. All salaries paid in full at rates that when compared to the European films are quite high. If a director writes and also produces the film (not unusual at all) the net profit of this “artist” is often 30% of the entire budget. Average budget of Brazilian features? Currently averages US$ 4 million. Some reach 8/10 million US dollars. Basically it’s all ” Global Production Standard” values. Not too different from  watching a soap-opera episode but in the “magical dark room” in a brand new Multiplex Cinemark. Rare exceptions, mediocrity is the standard.

If the film fails flatly in the box office? Who loses it? Nobody. It’s fully paid. Paid by the Brazilian State and ultimately by the Brazilian poor population who does not have health care, nor decent public services let alone the right to complain about another gigantic inequality of the rich up and coming world power player championed by the blue-collar president.

It’s worth to remark that the former Minister of Culture, singer Gilberto Gil, has received also subsidy money shortly after leaving the ministry for more than US$ 200,00 guess for what? To produce his music DVD! If Caetano Veloso wants to make a show with tickets costing US$ 100 per head, he demands subsidies as well. If any problems or complaints arise from the fact that one of the richest singers in the country gets subsidies, he himself will call the seating Minister of Culture and the rules will bend to accomodate his needs.

Is there any strategy in the works regarding the digital “revolution”? Yeah, Walkiria Barbosa, director of Festival do Rio has recently declared that it’s necessary to combine “education + punishment + alternatives”. As an old school Stalinist,  she has it all squared out. She and all the rest! To talk about the real alternatives in Brazil is to cast yourself out of the picture, I know! I’m doing it as I write these pages. Don’t think outside the dark room with a projector running a 35 mm print otherwise you are not cultivated enough at best. If it comes to worst you are a criminal and point period. End of discussion. Someone will find a way to punish you.

AT THE END OF THE DAY, it is an investment, done by a legal entity into another legal entity. If the product is good and has returns, the “investor” will receive the principal plus profits. The taxes the company owed? Forget it, nobody will ever recall that minor detail, for god’s sake!

Woody Allen and Rio

The bad news? It is all reserved to Brazilian nationals but if you are Woody Allen governments will line up to pay for your production. Bastardy is a highly appraised art in the country.

A patient time before revolution


After many years of floating adrift in the realm of media producers and other parasites of the kind, many authors have decided to break free from the system and do something with their lives. Many have simply changed profession. My case is a different ball and I cannot and I refuse to give up a lifetime of struggle because shortsighted people are in power in the cultural industry. No, I won’t give in and if I go down, I will go down fighting.

No matter where, and in fact I believe that borders are pretty worthless when we talk about cultural production and distribution, the old traditional media is leaking thru the seams and patches aren’t effective in order to keep the established rules in place.

The European Union has cleared the way to repression of the Internet thru article 138 which basically trashes the justice system to shreds: no need for court orders to punish “bad” citizens who download illegal materials. Sarkozy and other little men will be hands-free to punish. Their ego inflates but reality is quite nasty to show that unless they set up a real repressive system as there is in China and Iran (look to whom the European governments must to look for inspiration!!!) all these efforts will be in vain.  Almost at the same time, the US government has repealed the right-wing initiatives to force Internet control.

I have watched an interview of the Chilean-Spanish filmmaker Alejandro Amenabar in Radio Cable where he said interesting things: a) it is impossible to win against zero! b) the internet appears in the XXI century as the Christians appeared in the beginning of the first millenium as a genuine revolutionary force. c) Internet must the regulated in order to half a dozen filmmakers as himself continue to be able to produce 50 million euros budgeted movies (italic are textual citation from Mr. Amenabar). Quite interesting to see and hear that man defending without any sort of shame or embarrassment the inequity and mostly the absurd “Internet regulation” which he claims to be a necessity for films like  his delirious production which cannot be paid off ever in the European market but which he considers a necessity to the world and a right he has acquired.

So what are we talking about now? Revolution? I thought those small chats were left  after 20 years of the fall of the Berlin wall but it seems that analogies are being made with the ancient Christians overthrow of the Roman Empire!!!! That’s is amazing and revealing light at the same time. Hollywood majors and a bunch of Euro-filmmakers who aspire stardom at any cost have forgotten their historical differences and joined forces with the North-American right-wing, with the Republicans, with the European most autocratic governments, all them in a crusade against the “infidels”, thieves as the authors’ societies in Europe call downloaders.  That only brings to my mind that when all irreconciables enemies join forces it’s because the war is 100% lost.

What happens next then? It seems that all the options are fair when no option is taken. Certainly we are not going to see the end of times (if the end of times come we will be dead anyway and it won’t matter any longer), film and television will continue to exist as theatre and ballet didn’t die because of cinema and later on cinema survived video and DVD. There will be always a public for that media. But the truth of the matter is that currently all the studios are mad as hell and established authors also is not because film is dying. Film is not dying! The DVD market, the home market is terminally ill. No Hollywood blockbusters paid itself with 35mm prints released. Not since the 1970’s! It was all paid by video and later by DVDs rentals and sales. Digital medias, virtually cost-free medias today. So, please ladies and gentlemen! Quit screaming about film (movie theatres) and talk the name of the game: money making. DVD sales. DVD rentals. Digital media. Copyright.

This short video illustrates perfectly the new paradigma the entertainment industry faces.

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