Capitalism: The Nightmare

Truthdig, 9/20/2017

A worker in a costume representing world capitalism during a 2017 May Day rally in Jakarta, Indonesia. (Dita Alangkara / AP)

The neoliberal, arch-capitalist era we inhabit is chock-full of statistics and stories that ought to send chills down the spines of any caring, morally sentient human. Nearly three-fourths (71 percent) of the world’s population is poor, living on $10 a day or less, and 11 percent (767 million people, including 385 million children) live in what the World Bank calls “extreme poverty” (less than a $1.90 a day). Meanwhile, Oxfam reliably reports that, surreal as it sounds, the world’s eight richest people possess among themselves as much wealth as the poorest half of the entire human race.

The United States, self-described homeland and headquarters of freedom and democracy, is no exception to the harshly unequal global reality. Six of the world’s eight most absurdly rich people are U.S. citizens: Bill Gates (whose net worth of $426 billion equals the wealth of 3.6 billion people), Warren Buffett (Berkshire Hathaway), Jeff Bezos (Amazon), Mark Zuckerberg (Facebook), Larry Ellison (Oracle) and Michael Bloomberg (former mayor of New York City). As Bernie Sanders said repeatedly on the campaign trail in 2016, the top 10th of the upper 1 percent in the U.S. has nearly as much wealth as the nation’s bottom 90 percent. Seven heirs of the Walton family’s Walmart fortune have among them a net worth equal to that of the nation’s poorest 40 percent. Half the U.S. population is poor or near-poor, and half lacks any savings.

Just over a fifth of the nation’s children, including more than a third of black and Native American children, live below the federal government’s notoriously inadequate poverty level, while parasitic financiers and other capitalist overlords enjoy unimaginable hyper-opulence. One in seven U.S. citizens relies on food banks in “the world’s richest country.” Many of them are in families with full-time wage-earners—a reflection of the fact that wages have stagnated even as U.S. labor productivity consistently has risen for more than four decades.

Failure by Design

These savage inequalities reflect government policy on behalf of “the 1 percent” (better, perhaps, to say “the 0.1 percent”). U.S. economic growth since the late 1970s has been unequally distributed, thanks to regressive policy choices that have served the rich and powerful at the expense of ordinary working people. As Joshua Bivens of the Economic Policy Institute showed in his important 2011 study, “Failure by Design,” the following interrelated, bipartisan and not-so-public policies across the long neoliberal era have brought us to a level of inequality that rivals the Gilded Age of the late 19th-century robber barons era. These policies include:

● Slashing labor standards for overtime, safety and health.
● Tilting the laws governing union organizing and collective bargaining strongly in favor of employers.
● Weakening the social safety net.
● Privatizing public services.
● Accelerating the integration of the U.S. economy with the world economy without adequately protecting workers from global competition.
● Shredding government oversight of international trade, currency, investment and lending.
● Deregulating the financial sector and financial markets.
● Valuing low inflation over full employment and abandoning the latter as a worthy goal of fiscal and economic policy.

These policies increased poverty and suppressed wages at the bottom and concentrated wealth at the top. They culminated in the 2007-09 Great Recession, sparked by the bursting of a housing bubble that resulted from the deregulation of the financial sector and the reliance of millions of Americans on artificially inflated real estate values and soaring household debt to compensate for poor earnings.

After the crash, the government under both George W. Bush and Barack Obama bailed out the very financial predators who pushed the economy over the cliff. The Obama administration, populated by Goldman Sachs and Citigroup operatives, left the rest of us to wonder “Where’s our bailout?” as 95 percent of the nation’s new income went to the top 1 percent during his first term.

All of this and much more is contrary to technically irrelevant American public opinion. But so what? You don’t have to be a leftist to know that the United States’ political order is a corporate and financial plutocracy. Three years ago, liberal political scientists Martin Gilens of Princeton University and Benjamin Page of Northwestern University determined that the U.S. political system has functioned as an oligarchy over the past three-plus decades, in which wealthy elites and their corporations rule. As Gilens explained to the liberal online journal Talking Points Memo, “Ordinary citizens have virtually no influence over what their government does in the United States.”

Shock Profits

Most of this results from the normal, business-rule-as-usual operation of the American political process. Sometimes—as during “natural disasters” such as Hurricanes Katrina, Harvey and Irma—crisis moments allow wealthy interests to rack up huge profits almost overnight while much of the population is too shocked and distracted to respond. As Susan Zakin notes in the Los Angeles Review of Books, “Handing out billions for hurricane reconstruction will shore up [Donald] Trump’s faltering support on Wall Street and among major corporations profiting from a bonanza expected to top $100 billion.” Katrina provided precisely such a business opportunity to corporate America. So did the U.S. invasion of Iraq.

‘Isn’t It Beautiful?’

At the same time, Houston, for instance, is a much bigger scene of devastation than it would be but for business-rule-as-usual. The city was recklessly built up by and for elite financial and real estate interests and their governmental tools without the slightest concern for environmental sustainability and resilience. As Zakin notes:

[W]ithout a zoning code, [Houston is] a case study in urban sprawl. Houston was built on a dry (read: low-lying) lakebed that’s laced with bayous. The bayous are lined with concrete, steel and sheet metal, which is functional when it rains a little, but a contender for the luge event when it rains a lot, even in posh neighborhoods like River Oaks. Doing what it takes to prevent flooding, widening bayou channels, managing growth, putting in green space, might impede the only truly important flow: money. Houston’s city fathers have resisted any effort to plan for climate change, because, well, it doesn’t exist. As if that weren’t enough, parts of Houston are sinking, some as much as 2.2 inches a year.

It’s an epitome of the deadly “free market” chaos favored by arch-capitalist political actors such as the right-wing billionaire Charles Koch and his friend, the “libertarian” Sen. Jeff Flake, R-Ariz. In his recent, widely read book, “Conscience of a Conservative,” Flake writes with fondness about the time he met the eminent neoliberal University of Chicago economist Milton Friedman:

We picked him up at the airport, and while we were driving to a suburb of Phoenix we went through what could only be described as suburban sprawl. Someone in the car with us, remarking on this landscape, said, ‘Man, it looks like there was no planning at all.’ Friedman just nodded his head and said, ‘Yes, isn’t it beautiful?’ … [I]t wasn’t government coercion that had brought it into being. It was the invisible hand of the free market. Planning requires control, control empowers government, and empowered government = disempowered individuals.

Houston is the “petro-metro,” a major capital of the petrochemical industry and home to numerous toxic waste sites. As a result, the city’s floodwaters are loaded with hazardous materials.

How beautiful.

The “free market” madness rolls on. Like the melting polar ice, which opens up new business opportunities for oil drilling and ship travel even as it reduces earth’s ability to reflect sunlight back into space, the devastation resulting from extreme weather is both a consequence of the rule of big corporations (the real masters of the “free market” since the early 20th century in the U.S.) and a perverse opportunity for quick corporate profits.

On Aug. 15, 10 days before Hurricane Harvey hit Texas, Donald Trump, himself a global real estate baron, wiped out an Obama-era executive ordermandating that federal reconstruction grants take account of sea-level rise and related aspects of climate change.

Capitalist Climate-astrophe

Meanwhile, speaking of climate change, anthropogenic—really, capitalogenic—global warming threatens to turn the venerable popular struggle for a more equal distribution of wealth into a fight over the slicing up of a poisoned pie. The signs of climate catastrophe are unmistakable. Record-setting wildfires raged on the nation’s West Coast, and a devastating drought plagued much of the nation’s northern Great Plains as Houston was sunk in epic, chemically polluted flooding and Irma bore down on Florida. Like Hurricane Sandy (which filled New York City subway tunnels with storm surge on the eve of the 2012 elections), the Indian and Pakistani heat waves of 2015, Hurricane Katrina (2005), the Alberta, Canada, wildfires of 2016 and numerous other recent, lethal, meteorological episodes, this extreme weather is intensified by the spiking balminess of the planet.

The warming is fueled by capital-captive humanity’s excessive release of carbon dioxide resulting from the profit system’s rapacious extraction and burning of fossil fuels and its reliance on animal agriculture. Carbon accumulates in the atmosphere, trapping heat and melting the world’s glaciers and permafrost, which holds vast reserves of carbon-rich methane. As the ice caps retreat, less sunlight gets reflected back into space and more of it heats the planet toward a point where it becomes uninhabitable.

Extreme weather is just the tip of the melting iceberg. If not reversed, global warming will destroy the human species through famine, dehydration, overheating, disease and resource wars. It has us on the path to hell.

‘A Death Knell for the Species’

Trump has taken advantage of the nation’s plutocratic political dysfunction to become a kind of one-man ecological apocalypse. The fossil-fueled hurricanes, drought and wildfires of 2017 have hit the U.S. at a time when the White House is occupied by an openly ecocidal billionaire whose election rang what Noam Chomsky called an environmental “death knell for the species.” Trump has pulled the United States out of the moderate Paris climate accord. He has removed all references to climate change from federal websites and chose a fellow petro-capitalist climate change denier dedicated to crippling the Environmental Protection Agency to lead that department. Trump’s secretary of state is the former longtime CEO of Exxon Mobil Corp., history’s most powerful fossil fuel corporation—a company that buried and then organized propaganda against its own scientists’ warnings on carbon’s impact on the climate. Trump’s proposed budget calls for a 16 percent cut to the National Oceanic and Atmospheric Administration, which monitors all things climate- and weather-related.

This is ecocidal petro-capitalist madness on steroids.

After Harvey nailed Houston and before Irma hit Florida, Trump held a chilling ecocidal rally in front of an oil refinery in North Dakota. He boasted of how he had exited the “job-killing” Paris agreement (“It was so bad”) and approved the planet-cooking and supposedly job-creating Dakota Access and Keystone XL pipelines.

“I also did Keystone,” Trump said. “You know about Keystone. Another other one, big one—big. First couple of days in office, those two—48,000 jobs.”

Trump said the White House was going to make North Dakota’s current terrible drought vanish because “we’re working hard on it and it’ll disappear. It will all go away.”

The president also asserted that the thousands of Americans who protested the Dakota Access pipeline within and beyond the Standing Rock Indian Reservation last year had no idea why they were against it.

It may have been his most absurd speech yet.

The System Is Working

Like so much else in U.S. government policy, Trump’s anti-environmental actions are contrary to majority-progressive public opinion. Who cares? It’s one more in a long line of examples showing that “We the People” are not sovereign in the failed, arch-plutocratic and militantly capitalist state that is the 21st century United States.

Many Americans find this difficult to process because they have been taught to foolishly conflate popular self-governance with capitalism—what the George W. Bush White House called “a single sustainable model for national success.”

This is a great lie. My old copy of Webster’s New Twentieth Century Dictionary defines capitalism as “the economic system in which all or most of the means of production and distribution … are privately owned and operated for profit, originally under fully competitive conditions: it has been generally characterized by a tendency toward concentration of wealth and, [in] its latter phase, by the growth of great corporations, increased government controls, etc.”

This definition does not mention any of the things routinely and inaccurately identified with capitalism in the dominant U.S. political and intellectual discourse: democracy, freedom, trade, job creation, growth and/or a “free market” that is characterized by widespread competition and/or little or no government interference. Capitalism is about profit for the owners of capital—period. They attain this through any number of means. The most damaging include:

● Seizing others’ land and materials.
● Slavery (the leading source of capital accumulation in the United States before it was outlawed in 1863–65).
● Firing workers or replacing them with technology.
● Undermining the value and power of labor by “de-skilling” workers by reducing the amount of knowledge and experience they need to do their jobs.
● Abject authoritarian tyranny in the workplace, where Marxist economist Richard Wolff reminds us that most working-age adults spend the majority of their waking hours.
● Outsourcing work to sections of the world economy with the lowest wages and the worst working conditions.
● Hiring and exploiting unprotected migrant workers.
● Slashing wages and benefits, or cheating workers out of them.
● Purely speculative investment.
● Forming monopolies and using them to raise prices.
● Dismantling competing firms, sectors and industries.
● Deadly pollution and perversion of the natural environment.
● Appropriating public assets.
● Military contracting and war production.
● Working to shape political and intellectual culture and policy in capital’s favor by funding political campaigns, hiring lobbyists, buying and controlling the media, manipulating public relations and propaganda, investing in the educational system, offering lucrative employment and other economic opportunities to policymakers and their families, holding key policymaking positions, and threatening to withdraw investment from places that don’t submit to capital’s rules while promising to invest in places that do.

When capitalism is understood for what it is really and only about—investor profit—there is nothing paradoxical about its failure to serve working people and the common good, much less the cause of democracy. If corporate and financial sector profits are high, the system is working for its architects and intended beneficiaries: capitalists. Its great corporations (now granted the legal protection of artificial personhood) are working precisely as they are supposed to under U.S. common law, which holds that (as Michigan’s Supreme Court ruled in Dodge v. Ford Motor Company in 1919), corporate “managers have a legal duty to put shareholders’ interests above all others and no legal authority to serve any other interests.”

The Growth Ideology

Environmental ruin lies at the heart of the system, intimately related back to class rule. As Le Monde’s former ecological editor Herve Kempf noted in his aptly titled 2007 book, “How the Rich Are Destroying the Earth,” the oligarchy sees the pursuit of material growth as “the solution to the social crisis,” the “sole means of fighting poverty and unemployment” and the “only means of getting societies to accept extreme inequalities without questioning them.”

“Growth,” Kempf explained, is meant to “allow the overall level of wealth to arise and consequently improve the lot of the poor without—and this part is never spelled out—any need to modify the distribution of wealth.”

Trump was channeling this deadly “growth ideology” in North Dakota. Sadly, growth on the current carbon-fueled capitalist model has put humanity—not to mention thousands of other sentient beings on earth—on the path to near-term (historically speaking) extinction. We are currently at 410 carbon parts per million in the atmosphere—60 ppm beyond what scientists identified as a hazardous point years ago. We are on pace for 500 ppm—a level that will destroy life on earth—by 2050, if not sooner.

‘Inclusive Capitalism’

“Capitalist democracy” is an oxymoron and a mirage. So is the curious notion of “inclusive capitalism”—a term taken up by the corporate right wing of the Democratic Party, including Hillary Clinton’s closest economic advisers, in 2015. This is the Orwellian name of a global “coalition” set up in 2014 by Lady Lynn Forester de Rothschild for super-wealthy elites to advance a “caring capitalism” that “works better for the broad base of society.” Lady Rothschild’s Coalition for Inclusive Capitalism started with what former Rep. Cynthia McKinney described as “a Working Group comprised of such luminaries of social justice as Sir Evelyn de Rothschild of E.L. Rothschild [a financial firm owned by a family worth an estimated $2 trillion], Dominic Barton from McKinsey and Company [$1.3 billion], Ann Cairns [annual salary of $5 million] of MasterCard, Sir Sherard Cowper-Coles of HSBC, Paul Polman [paid 10 million euros in 2014] of Unilever, along with CEOs of various pension plans and philanthropic foundations, like the eponymous Ford and Rockefeller foundations.”

According to one British media report, the Coalition for Inclusive Capitalism’s opening conference boasted a “guest-list … estimated to hold one-third of the world’s investable assets, around £18tr [nearly $25 trillion].”

One of the coalition’s leading speakers and champions is the great arch-neoliberal, former U.S. President Bill Clinton (with a net worth of $80 million)—a right-wing Democrat who did every bit as much to advance the Wall Street “free market” and globalist agenda as Ronald Reagan.

‘We Must Make Our Choice’

One does not have to be a Marxist or other variety of radical to acknowledge basic differences and conflicts between capitalism and democracy. “Democracy and capitalism have very different beliefs about the proper distribution of power,” liberal economist Lester Thurow noted in the mid-1990s. “One [democracy] believes in a completely equal distribution of political power, ‘one man, one vote,’ while the other [capitalism] believes that it is the duty of the economically fit to drive the unfit out of business and into extinction. … To put it in its starkest form, capitalism is perfectly compatible with slavery. Democracy is not.”

More than being compatible with slavery and incompatible with democracy, U.S. capitalism arose largely on the basis of black slavery in the cotton-growing states (as historian Edward Baptist has shown in his prize-winning study, “The Half Has Never Been Told: Slavery and the Making of American Capitalism”) and is, in fact, quite militantly opposed to democracy.

“We must make our choice,” the late Supreme Court Justice Louis Brandeis is reputed to have said or written: “We may have democracy in this country, or we may have wealth concentrated in the hands of a few, but we cannot have both.” This statement was unintentionally but fundamentally anti-capitalist. Consistent with the dictionary definition presented above, the brilliant, liberal, French economist Thomas Piketty has shown that capitalism has always been inexorably pulled like gravity toward the concentration of wealth into ever-fewer hands. In the U.S., as across the Western world, the tendency was briefly and partially reversed by the Great Depression and World War II, producing the long “middle class” Golden Age of 1945-1973. But that was an anomalous era, a consequence of epic economic collapse and two global wars. Capitalism has returned to its longue durée inegalitarian norm over the last four-plus decades.

And even before the onset of the neoliberal period, capitalism at its comparatively egalitarian and high-growth, post-WWII Keynesian best had already pushed livable ecology into crisis. It tipped the world into what leading earth scientists have designated a new geological era: The Anthropocene—a period when “human activities have become so pervasive and profound that they rival the great forces of Nature and are pushing the earth into planetary terra incognita … a less biologically diverse, less forested, much warmer, and probably wetter and stormier era.” The not-so-Golden Agebrought what sociology professor John Bellamy Foster called “a qualitative transformation in the level of human destructiveness.” If this ecological destructiveness isn’t tamed very soon, nothing that progressives and the left care about is going to matter much: Who wants to turn a poisoned world upside down?

Can environmental catastrophe be averted under capitalism? Not likely. Shifting from fossil fuel reliance and other unsound environmental societal habits and practices—built-in obsolescence, mass consumerism and the endless pursuit of quantitative economic growth, accumulation and “cheap nature” resource appropriation—requires a level of coordinated social and public intervention so extreme that it is incompatible with continued capitalist control of the means of production, investment and distribution. It requires an empowerment of ordinary people and a radical rehabilitation of the concept of the natural and social commons—things that very likely cannot be attained under the continued rule of capital. Stark as American activist Joel Kovel’s formulation may sound, I suspect he is right: “The future will be eco-socialist, because without eco-socialism there will be no future.”

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By | 2017-10-05T15:38:08+00:00 October 5th, 2017|Articles|