Category Archives: Economics

Big Pharma and the Rise of Gangster Capitalism

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By Charles Hugh Smith

Source: Of Two Minds

$8 per vial in competing developed-world nations and $38,892 in the U.S. That says it all.

Thanks to decades of gangster films, we all know how gangster capitalism works: the cost of “protection” goes up whenever the gangster wants to increase revenues, any competition is snuffed out, and “customer demand” is jacked up by any means available– addiction, for example.

This perfectly describes the pharmaceutical industry and every other cartel in America. You might have read about the price increase in Acthar gel, a medication to treat Infantile Spasms. (via J.F., M.D., who alerted me to the repricing of this medication from $40 in 2001 to the current price of $38,892.)

The compound first received approval in 1950, and various branded versions have been approved in recent years. Let’s be clear: this medication did not require billions of dollars in research and development, or decades of testing to obtain FDA approval; it’s been approved for use for the past 68 years.

Yes, you read that correctly: a medication that’s been in use for 68 years went from $40 a dose in 2001 to $38,892 today. Don’t you love the pricing? Not a round 38 grand, but $38,892. You gotta love these gangsters!

There’s another related term to describe this form of capitalism: racketeering.That’s what mobsters do–operate rackets.

The Big Pharma racket enriches a number of gangs practicing gangster capitalism: the drug companies themselves, of course, but some doctors are profiting from the racket, and so are pharmaceutical lobbyists:

Study highlights role of doctor conflicts of interest in Medicare spending on Mallinckrodt drug Acthar Study published in JAMA indicates nearly 90 percent of doctors prescribing HP Acthar Gel took payments from drug’s manufacturer.

Here are the money quotes:

In 2014 Mallinckrodt raised the price of Acthar further to $34,000. The Federal Trade Commission and attorneys general from five states sued Mallinckrodt for anti-competitive behavior with regard to the acquisition of Synacthen Depot and the monopolistic pricing of Acthar, and in January 2017 the company settled, agreeing to pay $100 million and to license Synacthen Depot to a competitor. According to Kaiser Health News, Mallinckrodt responded by increasing its Congressional lobbying to $610,000, and its contributions to Congress members to $44,000, in the first quarter of 2017.

As an off-patent pharmaceutical, a similar drug, differing in formulation, available in Europe, made by a different manufacturer, sells for $8 per vial.

So a medication to treat infants costs $8 per vial in Europe and $38,892 in the U.S. Don’t you just love gangster capitalism to death? Because death and suffering is the gangsters’ ultimate threat: pay up or die.

Here’s another example of Big Pharma gangster capitalism at work: Insulin Drug Price Inflation: Racketeering or Perverse Competition?

Don’t you wish you had a racket where you could raise prices by 10% a year like clockwork, or triple the price of your “product” every decade?

Pfizer just raised prices on 100 medications:

The increases are effective as of July 1. In most cases, the increases are just over 9%, which is in line with the annual 10% price hikes adopted by most drug companies. Putting that number in context, core inflation printed at 2% last week.

Here’s a chart of the net result of gangster capitalism:

Gangster capitalism is the new model of “growth” in America, the model used by every cartel from higher education to Pentagon contractors. Eliminate actual competition, raise prices in lockstep with other cartel members, lobby the government to pay your extortionist prices, and threaten any resisters with severe consequences.

Try resisting your local government’s property tax increases to cover insiders’ pensions and healthcare benefits: it’s always “for the children,” of course, and if you don’t pay up, we’ll just auction off your house.

There’s no difference between that and being told you’re gonna be wearing concrete overshoes if you don’t comply.

The U.S. economy is nothing more than an exploitive jumble of rackets, insider plundering and gangster capitalism. $8 per vial competing developed-world nations and $38,892 in the U.S. That says it all.

Strategy and Conscience: Subverting Elite Power So We End Human Violence

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Fragment of “Butcher to the World” by Sue Coe.

By Robert J. Burrowes

Given the overwhelming evidence that activist efforts are failing to halt the accelerating rush to extinction precipitated and maintained by dysfunctional human behavior, it is worth reflecting on why this is happening.

Of course, you might say that the rush to extinction is being slowed. But is it? Even according to BP’s chief economist: ‘despite the extraordinary growth in renewables in recent years, and the huge policy efforts to encourage a shift away from coal into cleaner, lower carbon fuels, there has been almost no improvement in the power sector fuel mix over the past 20 years. The share of coal in the power sector in 1998 was 38% – exactly the same as in 2017…. this is one area where at the global level we haven’t even taken one step forward, we have stood still: perfectly still for the past 20 years.’ See ‘Analysis – Spencer Dale, group chief economist’.

And, to choose another measure that highlights our lack of ‘progress’: species extinctions proceed at a rate of 200 each day, which is vastly greater than the long-term background rate, with another 26,000 species already identified as ‘under threat’. See ‘Red list research finds 26,000 global species under extinction threat’.

But it wouldn’t matter what measure you analyzed – efforts to prevent cataclysmic nuclear war, to halt the many ongoing wars, to contain and reverse the prevalent and grotesque economic exploitation, to end slavery or the sex trafficking of women and children, to halt or even slow the rampant destruction of the biosphere, including the rainforests and oceans – we are rapidly losing ground (and often despite some apparent gains such as adoption of the ‘Treaty on the Prohibition of Nuclear Weapons’ by many non-nuclear states on 7 July 2017).

Not only are we destroying the rainforests – currently at the rate of 80,000 acres each day: see ‘Measuring the Daily Destruction of the World’s Rainforests’ – and oceans – see ‘The state of our oceans in 2018 (It’s not looking good!)’ – as a fellow long-standing nonviolent activist, Kelvin Davies, recently observed to me: the oceans and remaining rainforests are ‘being emptied of life’ as impoverished people, forced to the economic margin, hunt remaining wildlife, including tropical fish, for food and/or trafficking.

Before we blame impoverished people for their destruction however, it is the consumption by those of us in industrialized countries that is generating the adverse circumstances in which they are forced to survive. For one simple example of this, related to our diet alone, see ‘Emissions impossible: How big meat and dairy are heating up the planet’.

Of course, you might object that it is not activist efforts that are responsible for the failure to halt elite violence and our complicity in it. It is the failure of corporatized society to seriously consider and respond intelligently to the scientific and other evidence in relation to all of the violence in its many manifestations. However, any explanation of this nature fails to understand and appreciate why progressive change has always occurred in the past.

Social progress is the result of people of conscience strategically challenging elite power in such a way that new norms become so widely accepted that elites are compelled to work within them. This has always been essential for the simple reason that elites are insane and have never acted sensibly, whatever the issue. Elites have only ever orchestrated events to maximize their own power, profit and privilege whatever the cost to the rest of us and the Earth itself. Hence, violence, war, grotesque economic exploitation and ecological destruction are rampant across the planet; that is the way elites want it; that is what maximizes elite power, profit and privilege. See ‘The Global Elite is Insane Revisited’.

As an aside: if you aren’t convinced that the global elite is insane, then perhaps you might ponder the possible implications of the recent call by US President Donald Trump, for the creation of a new Space Force as a sixth branch of the U.S. military – ‘We must have American dominance in space’ – in violation of the Outer Space Treaty of 1967. See ‘Trump Orders Establishment of Space Force as Sixth Military Branch’.

While this enterprise, if it gets Congressional approval, would be staggeringly profitable to the global elite while further gutting social and environmental programs to pay for it, the proposal also raises the possibility, as Professor Karl Grossman graphically expressed it (given that there is no way to have the envisaged weapons in space without nuclear power) that ‘the heavens are going to be littered with radioactive debris’ for millennia (but in substantially greater amounts than is already there). See ‘Trump’s Space Force: Military Profiteering’s Final Frontier’ and ‘Star Wars Redux: Trump’s Space Force’.

Of course, if you want even more evidence of elite insanity, then look no further than the current hysteria generated by Donald Trump’s supposed ‘treason’ for having a meeting with Russian president Vladimir Putin in Helsinki with the intention of improving mutual understanding and the prospects of peace between the two countries. For a sample of the literature that discusses this summit intelligently, which you won’t find in the corporate media, see ‘US Media is Losing Its Mind Over Trump-Putin Press Conference’, ‘Is President Trump A Traitor Because He Wants Peace With Russia?’, ‘Helsinki Talks – How Trump Tries To Rebalance The Global Triangle’ and ‘Trump, The Manchurian Candidate: “Conspiracy” to Destabilize the Trump Presidency’.

Some informed and thoughtful analysts believe this could lead to an elite coup to remove Trump from the US presidency. See ‘Coming Coup Against Trump’ and ‘The Coming Coup to Overthrow President Trump: Sedition at the Highest Levels’.

So, to consolidate the information presented above, let me encapsulate the nature of geopolitics in one paragraph:

The military forces of the United States are not intended to defend the United States against military attack. The military forces of the countries in NATO are not intended to defend the respective member countries against military attack. The military forces of the United States and NATO are controlled by the global elite and used by the global elite to aggressively attack, in violation of all relevant national and international laws, any country that seeks independent control and development of its resources, particularly fossil fuels, strategic minerals and water. The global elite, which is in total control of the global economy and world affairs generally, does this in order to expand its own power, profit and privilege. It does this no matter what the cost to any individual (outside the elite), people, country and the biosphere. Why does the global elite do all of this? The global elite does this because it is completely insane.

Hence, to return to my point about the driver of social progress historically: Did the trans-Atlantic slave trade end because elites decided to halt the practice? Did gains for some women during the 21st century occur because elites committed themselves to ending patriarchal privilege? Did the British walk out of their colony in India because the British elite suddenly perceived the injustice of their violence and exploitation?

Despite the successes of activists of earlier generations, however, those of us who identify as activists of this generation are failing, quite comprehensively, to respond intelligently, powerfully and strategically to the vast challenges posed by an elite that has expanded its capacity to intimidate, outflank and overwhelm us (which is why, incidentally, slavery is now far more widespread than during any earlier period in human history, violence against women still manifests in a grotesque variety of forms all over the planet and even India has strayed monstrously from Gandhi’s vision).

In essence, strategic lessons learned by earlier generations of activists are forgotten or ignored as we stumble powerlessly to the extinction that is shortly to claim us all.

While I could write at some length about our shortcomings as activists in the era of perpetual violence and war, grotesque economic exploitation and pervasive climate and environmental destruction, I would like to focus on what I regard as the two key issues: strategy and conscience.

The global elite is deeply entrenched and manages world affairs, particularly through its capitalist economy. The global elite has developed over hundreds of years during which time it has fully and deeply penetrated all of the major power structures in world society, most of which it created (or moulded during their creation), so that the primary levers of power in the modern world – key financial institutions such as central banks, the major asset management corporations and the giant corporations in key industries (such as, but not limited to, the banking and weapons industries) – as well as the instruments through which its policies are implemented – including governments, military forces (both national and as ‘military contractors’ or mercenaries), key ‘intelligence’ agencies, legal systems and police forces, key nongovernment organizations such as the Vatican, and the academic, educational, media, medical, psychiatric and pharmaceutical industries – are all fully responsive to elite control.

More precisely than this, as explained in his forthcoming book ‘Giants: The Global Power Elite’, Professor Peter Phillips identifies the world’s top seventeen asset management firms, each with more than one trillion dollars of investment capital under management, as the giants of world capitalism. The total capital under management on behalf of all seventeen corporations is in excess of $US41.1 trillion; it represents the wealth invested for profit by thousands of millionaires, billionaires and corporations. These seventeen giants operate in nearly every country in the world and are ‘the central institutions of the financial capital that powers the global economic system’. They invest in anything considered profitable, ranging from ‘agricultural lands on which indigenous farmers are replaced by power elite investors’ to public assets to war.

Phillips goes on to note that the global elite develops and coordinates its policies through a variety of private planning fora such as the Group of Thirty, the Trilateral Commission and the Atlantic Council which determine the policies and issue the instructions for their implementation by transnational governmental institutions like the G7, G20, International Monetary Fund, World Trade Organization and the World Bank. Elite policies are also implemented following instruction of the relevant agent, including governments, in the context. These agents then do as they are instructed.

Or, if they do not, they are overthrown. Just ask any independently-minded government over the past century. For a list of governments overthrown by the global elite using its military and ‘intelligence’ agencies since World War II, see William Blum’s book ‘Killing Hope: U.S. Military and CIA Interventions Since World War II’ or, for just the list, see ‘Overthrowing other people’s governments: The Master List’.

As a result of coordination through the above elite fora, for example, gigantic media, public relations and entertainment corporations are used to reinforce elite dogma promulgated through national educational institutions so that most western humans become powerless consumers of elite product, informational and material, as the elite pursues ever-increasing profit, power and privilege. Oblivious to the way in which they are caught up in the elite drive to make us consume, even most western activists are major consumers, failing to limit their consumption in line with some appreciation of the per capita ecological carrying capacity of the Earth.

Hence, as should be obvious by now, with a deeply entrenched global elite in total control of major economic/financial, political, military, legal and social (including educational and media) power structures, only a comprehensive and sophisticated strategy has any prospect of succeeding, whatever the issue, and certainly the fundamental one: elite power.

In other words, if we want to end war (or even just one war), halt exacerbation of the climate catastrophe (in a region, country or the world), end environmental destruction on a vast range of fronts, terminate economic exploitation including (modern) slavery, end the sex trafficking of women and children, end the military occupation of Palestine, Tibet, West Papua… then we are going to have to think, plan and act strategically, which includes engaging and mobilizing, in a focused way, a significant proportion of the human population. Simply ‘campaigning’ on the basis of a few ideas and tactics that we think worked in the past, is not enough. Campaigning without strategy – and all that strategic thinking, including a penetrating analysis of the very nature of society and its power structure, entails – is a waste of time.

This is why most work of virtually all ‘activist’ NGOs is useless. They work within the elite-designed and managed global power structure, fearfully self-limiting their actions in accordance with elite-approved processes, such as those ‘within the law’ and lobbying elite-controlled governments and institutions, as well as international organizations such as the UN. By participating in elite-controlled processes, our dissent is absorbed and dissipated, as the elite intend.

This is the great achievement, from an elite perspective, of ‘democracy’: to the extent that people can be persuaded to participate in the delusion that democracy exists (anywhere on Earth) and that voting and lobbying changes anything important, they are unwitting victims of elite-manipulated processes and propaganda.

This also explains why virtually all NGOs invariably end up promoting elite-sponsored delusions such as, for example, those in relation to the climate catastrophe which talk of an ‘end of century’ timeframe (about 70 years more than we actually have), staying within 2 (or 3 or 1.5) degrees Celsius above the pre-industrial level (rather than the .5 degrees that is actually necessary) and, the most fundamental delusion of all, that we must substitute renewable energy for fossil fuels (which is certainly necessary), rather than (in addition) profoundly reduce – by at least 80% – consumption generally, involving both energy and resources of every kind – water, household energy, transport fuels, metals, meat, paper and plastic – while dramatically expanding our individual and community self-reliance if all environmental concerns are to be effectively addressed.

But elite-sponsored delusions are widely promulgated by its corporate media on a vast range of issues with only the rarest ‘activist’ NGO, concerned to focus on what it defines as its primary mission, taking a stand on these apparently ‘separate’ issues. So, for example, elite-sponsored delusions that are widely promulgated by its corporate media convince huge numbers of people that US-NATO wars against impoverished and militarily-primitive countries are in ‘self defense’ and that terrorists are a genuine threat to ‘national security’. At a more mundane level, elite-sponsored delusions propagated through its corporate media promote everything from genetically-mutilated, poisoned and junk food to psychiatric drugs. See ‘Defeating the Violence of Psychiatry’. These products are also highly profitable but because their insanity includes lacking any sense of morality, elites are unconcerned about the damage they inflict on us in these regards just as in all others.

Some grassroots activist groups are more politically savvy than NGOs but usually still lack comprehensive and sophisticated strategies. On rare occasions, it should be noted, one of these campaigns or national liberation struggles succeeds, because of such factors as the raw power of nonviolent action (even without strategy) or because they could rely on the NIMBY (Not In My Back Yard) effect to facilitate mobilization of significant numbers of people in a local area.

However, the global elite is unconcerned about the occasional local ‘setback’ which does not adversely impact its global agenda and where minor gains by grassroots activists can, if necessary, be subsequently reversed (including by simply violating the law, as the elite routinely does with impunity). Consider again, the above example of Trump’s call to violate the 1967 Outer Space Treaty or routine violation of legally-declared (and sometimes World Heritage-listed) national parks in Africa, Asia and Central/South America as major corporations seek to exploit oil and mineral wealth. The law is designed to intimidate and impede us; it is rarely used in an attempt to hold elites accountable and has little, if any, impact when it does: a corporation may, occasionally, be fined (an expense against generating monstrous profit). Fundamentally, elites are above the law: they draft it to defend their interests against the rest of us.

But to reiterate the main point: given the sheer number of (sometimes even large-scale) mobilizations on one issue after another around the world that achieve nothing of substance in relation to the issue itself (consider the demonstrations against the imminent war on Iraq, held in over 600 cities around the world and involving as many as 30 million people, on 15 February 2003), it is painfully clear that most grassroots activists have no conception of strategy either, including the appropriate strategic focus for their tactics.

And this applies equally to those national liberation activists in occupied countries such as Palestine, Tibet and West Papua, as well as those activists living in the many countries, such as Cambodia and the Democratic Republic of the Congo, run by dictatorships or where the elected government, such as that of Brazil, has been removed in a coup.

As touched on above, however, lack of sound strategy (including the structural analysis on which it must be based) is not the only shortcoming in our efforts to halt elite (or even our own) violence.

In the past, a primary motivator of activists, and particularly the great ones such as Mohandas K. Gandhi, was their conscience: The ‘inner voice’ that called them to action on both the personal and political levels.

But there is more to conscience than being called to action. So what is so important about conscience? Conscience is the mind function that asks the deeper questions such as ‘What is the right way to go about this?’, ‘How must I behave if I am to model what I ask of others?’ and ‘How will we design this campaign so that its conduct helps to create the world we envision?’ (rather than the simpler question ‘How will we win this campaign?’).

Moreover, living by one’s conscience requires courage: This includes making strategic choices to take significant or, occasionally, even great risks when elite violence threatens to intimidate a struggle into submission and silence.

It was his unyielding conscience, deeply guiding his personal and political behaviour (including his commitment to nonviolence and his extraordinarily austere lifestyle), and his superlative understanding of strategy that made Gandhi the great activist that he was. Why?

Because Gandhi’s nonviolence was based on certain premises derived from his conscience – including the importance of the truth, the sanctity and unity of all life, and the unity of means and end – his strategy was always conducted within the framework of his desired political, social, economic and ecological vision for society as a whole and not limited to the purpose of any immediate campaign.

It is for this reason that Gandhi’s approach to strategy is so important. He is always taking into account the ultimate end of all nonviolent struggle – a just, peaceful and ecologically sustainable society of self-realized human beings – not just the outcome of this campaign. He wants each campaign to contribute to the ultimate aim, not undermine vital elements of the long-term and overarching struggle to create a world without violence.

So what do we do?

If you would like to better understand why so many human beings, including those within the elite, are devoid of anything resembling a conscience, you can do so by reading what happened to them as a child in ‘Why Violence?’ and ‘Fearless Psychology and Fearful Psychology: Principles and Practice’.

If you are interested in acting in ways that maximize the chance that elite opponents and their agents will reflect, deeply, on what they are doing, while fundamentally changing the power relationship between you and your opponents, then you are welcome to consider acting strategically in the way that Gandhi did. Whether you are engaged in a peace, climate, environment or social justice campaign or a national liberation struggle, the 12-point strategic framework and principles are the same. See Nonviolent Campaign Strategy and Nonviolent Defense/Liberation Strategy.

The strategic aims and a core list of strategic goals to end war and to end the climate catastrophe, for example, are identified in ‘Campaign Strategic Aims’ and the strategic aims and a core list of strategic goals to defeat a political or military coup, remove a military occupation, remove a dictatorship or defeat a genocidal assault are identified here: ‘Liberation Strategic Aims’.

If you would like a straightforward explanation of ‘Nonviolent Action: Why and How it Works’ and an introduction to what it means to think strategically, try reading about the difference between ‘The Political Objective and Strategic Goal of Nonviolent Actions’.

If you anticipate violent repression by a ruthless opponent, make sure that you plan and implement any nonviolent action as history has taught us: ‘Nonviolent Action: Minimizing the Risk of Violent Repression’.

If you are interested in nurturing children to live by their conscience and to gain the courage necessary to resist elite violence fearlessly, while living sustainably despite the entreaties of capitalism to over-consume, then you are welcome to make ‘My Promise to Children’. After all, capitalism and other dysfunctional political, economic and social structures only thrive because of our dysfunctional parenting which robs children of their conscience and courage, among many other qualities, while actively teaching them to over-consume as compensation for having vital emotional needs denied. See ‘Love Denied: The Psychology of Materialism, Violence and War’.

Why this emphasis on children you might ask? For good reason. It is dysfunctional human behavior that got us into this civilizational mess and allowed the emergence of exploitative social, political and economic structures. So if we do not emphasize the importance of profoundly changing the way in which we nurture children so that they behave functionally in context, everything else we do to preserve humanity and the biosphere must ultimately fail. The onslaught of our dysfunctional species will simply overwhelm the biosphere, sooner or later, whether it is this generation or the next.

But we don’t have to settle for improving our parenting. We can improve our own functionality and access our conscience and courage too. How? See ‘Putting Feelings First’.

If you are already guided by your conscience to act powerfully in response to elite violence, you might also consider joining those participating in ‘The Flame Tree Project to Save Life on Earth’, which outlines a simple plan for people to systematically reduce their consumption while progressively increasing their self-reliance, and consider signing the online pledge of ‘The People’s Charter to Create a Nonviolent World’.

You may believe that you can halt elite violence without engaging your conscience (and the deep internal search that this requires) and without using Gandhian nonviolent strategy. Even if you are right, the key question is then this: Is the world you will get any better than this one?

And don’t forget the timeframe. Major historical struggles, including those noted above, took decades (whatever the merits and shortcomings of their strategies) or, as in most cases, are ongoing. How long do you want to wait before you invest time in learning how to think, plan and act strategically when the future of humanity and the biosphere is now at stake?

So, to conclude: The global elite controls all significant human affairs and even exercises almost total control over the individual lives of human beings. Because the global elite is insane and its psychological (and hence behavioral) dysfunctionality is of a particular kind, it cannot pull back from its existing regime of violence and exploitation, even in response to imperatives from the biosphere.

In this circumstance our choice is simple: near-term human extinction based on our unwitting complicity in elite violence or a conscientious, courageous and strategic response that fundamentally undermines elite power.

This will require a significant number of interrelated nonviolent strategies that each tackle elite violence in one context or another.

You are welcome to consider the options presented just above for your own involvement.

 

Biodata: Robert J. Burrowes has a lifetime commitment to understanding and ending human violence. He has done extensive research since 1966 in an effort to understand why human beings are violent and has been a nonviolent activist since 1981. He is the author of ‘Why Violence?’ http://tinyurl.com/whyviolence His email address is flametree@riseup.net and his website is here. http://robertjburrowes.wordpress.com

Robert J. Burrowes
P.O. Box 68
Daylesford, Victoria 3460
Australia

Email: flametree@riseup.net

Websites:
Nonviolence Charter
Flame Tree Project to Save Life on Earth
‘Why Violence?’
Feelings First
Nonviolent Campaign Strategy
Nonviolent Defense/Liberation Strategy
Anita: Songs of Nonviolence
Robert Burrowes
Global Nonviolence Network

Western Elites Decrying ‘Populism’ Betrays Fear of Democracy

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By Finian Cunningham

Source: Strategic Culture Foundation

A new dreaded word has entered into official Western media speak: “Populism”. Political parties and governments which are deemed to be illegitimate are invariably labeled with the prefix “populist”. There is a vague implication that “populist” parties are imbued with disreputable politics of xenophobia, racism, nationalism and even fascism.

But who is doing the “deeming” here? It is establishment political parties and politicians who have the advantage of establishment news media organizations conveying their words and terminology.

Take French President Emmanuel Macron. He may have coined a new political party, En Marche, but he is nevertheless a politician very much of the prevailing Western establishment. He is pro-European Union as it currently operates, albeit with reforming tweaks; he is pro-NATO, pro-Atlanticist; and pro-neoliberal economic policies.

Recently, Macron decried the rise of “populist” parties across Europe. He compared them to the spread of “leprosy” and claimed they were posing a morbid threat to the conventional order of politics. Macron was referring in particular to the new coalition government in Italy, comprising the anti-establishment Five Star Movement and the League.

The French leader could also have been referring to any number of governments as seen in Austria, Hungary and other Central European states which, like the new Italian government, have challenged the EU’s official stance overEU irregular migration into the bloc.

In this context, the word “populist” as used by Macron and other establishment politicians has the connotation of “racist” or “inhumane” owing to the opposition towards the uncontrolled influx of people from outside Europe.

The “populist” prefix is often used alongside the term “far-right”. Again, the implication is that somehow the largely newcomer parties are something that should be abhorred because they are tarnished with alleged proclivities towards fascism and authoritarianism.

To reinforce that implied demonization, it is often cited by Western establishment politicians and media that the “populist” parties in Europe are aligned with Russian President Vladimir Putin, if not stealthily bankrolled by the Kremlin.

American President Donald Trump also qualifies as “populist” according to the US political and media establishment. Again, the word is loaded to infer a uniquely noxious quality in the Trump presidency and his supporters, in the same way that Democrat presidential rival Hillary Clinton once haughtily denigrated Trump and his voter base as “deplorable”. It’s a way of sanitizing the establishment from any past, and far greater, sins.

The P-word does not always mean “rightwing nationalism”. The recent elected Mexican President, Andrés Manuel Lopez Obrador, has been described in Western media as a “leftwing populist”.

In Italy, the main ruling coalition party, the Five Star Movement, headed by Luigi Di Maio, is associated with leftwing social policy.

Parties and politicians deemed to be “populist” are eclectic and defy an easy categorization, as their detractors would perhaps like to assign them. Certainly, there is a strong common stance of being opposed to uncontrolled immigration. But it is too simplistic to explain such a stance as merely xenophobic or racist.

There are legitimate and reasonable concerns that the issue of large-scale immigration has been exploited by ruling establishments and their ideological backers as a way to undermine national sovereignty and workers’ rights, from the consequent lowering of wages and employment conditions.

There is also the legitimate concern in Europe that the migration phenomenon has been largely created by illegal wars pursued by the US and its European NATO allies. Why should European member states and ordinary taxpayers have to incur financial and cultural integration problems that have been largely manufactured by ruling elites who have never been held to account for their criminal wars?

So-called populist parties are also opposed to the seemingly slavish adherence by the European political establishment to neoliberal capitalism. There is a legitimate popular backlash to economic policies which are oppressive and destructive, and whose sole priority seems to be satisfying the profits of Big Business and transnational capital. Why should European governments be held in hock to fiscal rules and debt limitations set arbitrarily by institutions seemingly under the diktat of private banks?

There are several fundamental issues that form a groundswell of popular opposition towards the conventional ways of governance, both in Europe and the US. The failings of neoliberal capitalism and its rich-get-richer racket is surely top of the grievance list. So too is relentless, irrational militarism by Western governments, unleashing illegal wars and massive refugee problems, as well as stoking unnecessary hostility towards other powers like Russia, China, Iran and North Korea.

The conventional politics, that is, the ruling establishments and their dutiful news media, are increasingly seen as incompetent, if not bankrupt. The establishment across Western countries has lost legitimacy and “moral authority” in the eyes of masses of people. That dwindling authority of the ruling class in Western states is the real, morbid concern.

One factor for this is the growth of global communications and “alternative” media sources, which Western publics are availing of to inform themselves independently from the old information monopolies that served the established order. That is why the “problem” of alleged “Russian influence” has been invented. In a desperate gambit to distract the masses from noticing the real problem, which is the crumbling of legitimacy for the Western establishment and its obedient political parties.

The looming fear among the ruling order is the ever-growing dissent among the populace. It is a fear of their own inherent failing and impending doom in the face of democratic challenge to power.

It is not so much that Trump or the new Italian government or Hungarian leader Viktor Orban, and so on, represent a vanguard for renewed democracy. These changes are merely symptoms of a deeper popular opposition to the established way of conducting politics – the order that has prevailed for most of the seven-decade period following the Second World War.

There has always been a wariness among ruling elites on both sides of the Atlantic towards a genuine democratic order breaking out, as Noam Chomsky discusses in his book ‘Deterring Democracy’. Western elites have typically viewed the masses as “rabble rousers” who are deemed to be “incapable” of governing society in the “proper way” that benefits the elites, protects their profits and property, and safeguards their imperial war-making overseas.

This underlying tension about the control of political power in Western societies encapsulates the present historical juncture where the word “populist” is being increasingly deployed. It is a term of disparagement by a failing Western establishment. What the failed order is trying to do is divert genuine popular challenge by painting it as something uncouth, vulgar, noxious, or manipulated by foreign enemies like Russia.

As American political analyst Randy Martin notes: “Populism is a convenient term for those in power who seek to isolate those who would want to share, or worse, take that power.”

When you think of the original meaning of the word – “the people” – it is starkly revealing what is really at stake for those elites who wield the “populist” term as a disparagement.

This Viral ‘Feel-Good’ Story Is Actually an Indictment of American Labor Hell

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By Luke O’Neil

Source: Observer

In what’s quickly become the feel-good story of the week, a young Alabama man named Walter Carr is being lauded across the country for his perseverance and indomitable spirit. It’s the type of story that can instill hope in a divided nation when it’s sorely needed and serve as inspiration for the rest of us that if you work hard enough and keep a positive attitude, good things will come to you. It also happens to be disgusting horse shit and an utter indictment of the brutal, indifferent hell of the nightmare capitalist wasteland we all suffer in. So, a bit of a mixed bag here. 

Carr, a 20-year-old college student, as nearly every news outlet has pointed out in sepia-tinted coverage—from CBS News and USA Today to the BBC—was set to start a new job on Saturday morning with the moving company Bellhops. At the last minute, his car broke down, and he was unable to find a ride from friends to get there. Instead, he decided to walk. He began the trek, which was roughly 20 miles from his home, at midnight, hoping to get there by 8 a.m. the next day to meet the rest of the movers. 

“I didn’t want to defeat myself,” Carr later told ABC News.

Along the way, around 4 a.m. in the morning, Carr, a young person of color, was stopped by local police officers, who, out of the kindness of their hearts, no doubt, asked him where he was headed. When he explained the situation—and after his story checked out—they decided to give him a ride the rest of the way, even going so far as to take him to breakfast.

“He was very polite. It was ‘yes sir’ and ‘no sir,”’ one of the officers later said. I bet he was!

When he arrived at the moving job a few hours later, complete with police escort, they explained the situation to Jenny Lamey, the woman who had hired the movers. Inspired by Carr’s work ethic and apparent decency, she shared the story on Facebook, where it soon went viral. 

The story eventually came to the attention of Bellhops CEO Luke Marklin, who arranged to meet Carr a few days later for a big surprise. 

“This is how you pay it forward… treat your employees with respect and incentivize them and bet you’ll get a much better worker for it,” wrote one commenter on Twitter. “It is awesome to see a young man not make an excuse like it’s too far to go to work, and then see him rewarded for it. Wish the young man and the company all the best in the future,” added another. 

It’s enough to drive you to tears. What kind of tears those are will probably depend on how susceptible you are to the lie at the heart of American capitalism and Horatio Alger nonsense.

Carr who set out the night before with a kitchen knife to protect against stray dogs on the walk, as he explained to The Washington Post, nonetheless floored everyone he encountered along the way. 

“He’s such a humble, kindhearted person,” Lamey said. “He’s really incredible. He said it was the way he was raised.”

“We set a really high bar for heart and grit and… you just blew it away,” Marklin told him, after gifting Carr his 2014 Ford Escape (barely-driven! as alabama.com reported). 

A GoFundMe set up by Lamey to help Carr with his car troubles has since raised almost $40,000. 

“Nothing is impossible unless you say it’s impossible,” she told the Post. 

Nothing except for paying workers an actual salary with benefits, which, you may not be surprised to hear, Bellhops does not do. Essentially Uber for movers, (Marklin came to the company from Uber), Bellhops relies on the labor of young college students, like Carr, who take jobs on a gig-by-gig basis. The company, which operates in dozens of cities around the country, and has raised tens of millions of dollars in rounds of funding since it was founded in 2011, pays movers between $13-16 an hour. 

“It’s a transitional job,” CEO Cameron Doody told BuzzFeed News in a story from 2015. “It’s not a career.”

Alabama, incidentally, is also only one of five states that has traditionally never spent any state money on public transportation. 

Naturally, Bellhops are very proud of themselves, and have been reveling in the attention. You probably didn’t know the company existed before yesterday, and may be thinking about contracting their services in the future now. Win win. 

“I want people to know this—no matter what the challenge is, you can break through the challenge,” Carr, who also wants to become a Marine some day, said of his story. 

“Nothing is impossible unless you make it impossible,” he added. “You can do anything you set your mind to. I’ve got God by my side. I’m really emotional right now trying to hold back the tears.”

It’s a heartwarming reminder that, much like with getting sick or injured in America, which needs to be done in a tragic but endearing enough way to go viral so people will pay your medical bills, all you have to do to make it in this beautiful country is have your life fall apart in such a way that the news wants to write about it, then hope the benign feudal lords will see fit to offer you as an aspirational example to the rest of us so we remain compliant.

25 Families Own $1.1 Trillion Between Them as the Global Wealth Inequality Gap Grows

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Using data from their list Forbes has produced a list of the top 25 richest families in the world. Together they are worth over $1.1 trillion, or the entire GDP of Indonesia.

By  Rosa Tressell and Dr. Leon Tressell

Source: SouthFront

Once a family-owned business Forbes is well known for producing their annual list of the world’s richest billionaires. Launched in 1982 the original list ranked the top 400 Americans by net worth. Only 13 billionaires were included in that list, and their combined worth was the equivalent of 2.8% of GDP. In an era where “Greed is Good”, the list became wildly popular, by 2000 the combined net worth of the top 400 equated to 12.2% of US GDP. So prestigious became the list that an ex-employee of Forbes has claimed that Donald J Trump inflated his personal wealth to be included.

This year more than 2,200 billionaires made the Forbes list with a combined value of $9.1 trillion, or half the GDP of the US. Amazon CEO, Jeff Bezos, topped the list this year as his fortune rose to £112 billion making him the first centi-billionaire. His wealth is now equal to that of 2.3 million Americans. This has allowed him to dethrone Bill Gates, founder of Microsoft, worth just $90 billion.

Using data from their list Forbes has produced a list of the top 25 richest families in the world. Together they are worth over $1.1 trillion, or the entire GDP of Indonesia. The richest clan is the Walton family who own the ubiquitous Walmart chain in America. They have a total family wealth of £152 billion and several family members are on the list of billionaires as individuals. The Koch Brothers, of Koch Industries, are ranked second with £98.7 billion. The third spot, with $90 billion to their name, is taken by another American family, the Mars family, known for their various sweet treats.

In comparison to the billionaires list this list is a measure of families who have inherited and grown their wealth over generations. The billionaires list is dominated by Americans in certain fields; technology, finance, entertainment and sport. It lauds entrepreneurism and promotes the self-made man (and small handful of women). The family fortunes list on the other hand reveals a more historical route for making money. Whilst Jeff Bezos has shot to the top of the list based largely on the astonishingly over valued share price of Amazon stock, the family fortunes are centered on the production and purveyance of goods.

Many of the families on the list started making their fortunes in the late nineteenth century. These are: Cargill Industries (agricultural conglomerate); Boehringer Ingelhelm (pharmaceuticals); Cox Enterprises (communications); Hyatt Hotels (hotels); SC Johnson (household goods); Roche (pharmaceuticals); and the Hearst Corporation (media). Meanwhile the Van Damme/De Spoelberch/De Mevius family (ranked fourth with a fortune of $54.1 billion) have been brewing quality Belgian beer, like Stella Artois, dating back centuries.

The production and purveyance of quality high end goods as a means to fortune is evident as BMW (the Quandt family), Chanel (the Wertheimer family) and Hermes (the Dumas family) find these families all ranked in the top ten.

Reliance Industries is the fist non-Western entry. A Mumbai-based energy conglomerate, it was founded by Dhirubhai Ambani in 1957 and is now worth $43.4 billion. It was his ambition to be the world’s richest man. However, following his untimely death there was a very public and acrimonious dispute between his two sons revolving around the inheritance. The widow eventually brokered a settlement and the family fortune goes on, but it does show how easily a family fortune can be dissipated.

In addition to Walmart there are two other families that have made their fortunes in retail. The Albrecht Brothers who founded Aldi are ranked 11th with a $38.8 billion fortune followed at twelfth by the Mulliez family who founded Auchan, France’s equivalent of Walmart. At thirteenth spot, with a fortune of £34 billion, is the Kwok family. They started in business as a grocery wholesaler but they really made their money when they moved into Hong Kong real estate in the 1970s. Similarly the Lee family from South Korea began as grocery exporters but have made their fortune as the worlds largest producers of smart phones with their company Samsung.

There is some methodology to the list that requires explanation. Bloomberg’s categorisation of family wealth is based on reliable, sourced documentation. They add up family members assets, including stakes in public and private companies, real estate, art and cash, and takes into account debts. It excludes first-generation fortunes and those in the hands of a single heir. It also excludes those who have derived their fortune from the state. This explains why there are no Chinese families on the list and only three from the Asian region. As newly found wealth is handed down this looks set to change.

The Forbes list also excludes members of royal families and dictators who derive their fortunes entirely as a result of their position of power. Nor do they value those holding fortunes in trust for their nations. So, despite being worth untold billions, families like the royal family of Brunei or the British monarchs are absent. Quantifying this wealth is difficult. For example, Buckingham Palace alone would be valued in excess of $5 billion, however there would certainly be conflict with Parliament if the Queen wanted to sell it!

Many billionaires positively don’t want to be on the list. They don’t want the publicity for their families with the increased risk of kidnapping, being hit up for money, questions from the tax man or even from law enforcement. Kenichi Shinoda, current Kingpin of the Yakuza, is rumoured to be worth billions but is known to keep a low financial profile. There is also plenty of Western media speculation that the President of Russia, Vladimir Putin, is actually the world’s richest man. The Bush family have amassed a vast fortune, and there are allegations that much of it has been amassed behind the political scenes in various CIA backed gun and drug running operations.

Calculations of wealth, for individuals or families, can be obfuscated by the numerous off shore arrangements that exist today. Historically, many of the world’s largest landowners are not officially registered as a result of having held title to the land for centuries. In addition trusts, foundations and “charities” allows for the ownership and management of assets in a more private manner. Wealthy families pay professionals a healthy wage to minimise their exposure to the taxman – especially avoidance of inheritance tax.

Absent from the list are the giant banking families, the Rockefellers, the Morgans and the Rothschilds; famed for being on every conspiracy theory list as powers behind the scene. The report says that their fortunes are too diffuse and diversified to correctly value. Other families suspected of wielding their riches for their own political and social agendas include the DuPonts, the Astors, the Bundys and the Freemans, to name a few. Families that like to keep their immense fortunes and their activities confidential.

To have such wealth is naturally to have much power. Certain families, like the Bushes and the Kennedys used their cash to enter politics. The Koch Brothers have already pledged $400 million to the Republicans for the 2018 mid-term elections and their support was seen as instrumental in securing Donald J Trump’s election victory. The Walmart Family Foundation is one of America’s largest political donors, and is described as a “heavy hitter” from the Centre of Responsive Politics. Economic advantage is translated into legislative favours via lobbying and campaign donations. For example, one Arkansas Congresswoman who supported the repeal of an estate tax received $83,650 from the Walton Family Foundation and  now works for them as a lobbyist. This exemplifies the corrupt relationship between economic and democratic inequality and is indicative of a system where the majority feel their voice is irrelevant.

Capitalism is built on an idea that a rising tide lifts all ships. We are supposed to look up to these rich families as examples of our betters. Underlying the lists that Forbes assembles is a worshiping of the rich. Underpinning the American dream is that its possible for anyone or any family to make it (onto the list). However, even Scrooge McDuck must be envious of the enormous fortunes of these families. As the wealth inequality gap grows within countries, especially the Western nations, there is the risk that the social fabric is coming apart at the seams. When 40% of Americans have less then $500 in savings the material basis for living the Dream is seriously compromised. Indeed, this could all turn just as easily into anger as people see that the six individual Walmart heirs alone have more wealth than the bottom 30% of the US population, and they ask themselves is this fair?

This report confirms accelerating trends towards further wealth disparity. Reports by Oxfam have shown a gaping chasm of global inequality. In 2017 3.7 billion people saw no increase in their wealth, whilst 82% of the wealth created went to the top 1%.

According to the World Inequality Report 2018:

If established trends in wealth inequality were to continue, the top 0.1% alone will own more wealth than the global middle class by 2050.

Donald Trump’s ambition to be included on the list displays his naked ambition for money, power and success. In his school of market economics, of dog eat dog, this trend is only the logic of the market. It is seen as aspirational by those at the top and by magazines like Forbes. However, even the 1% at Davos earlier this year had wealth inequality on the agenda. As the social fabric tears, political and social instability will increase. The Brexit vote, driven by the anger of the dispossessed English working class, for example, has turned the UK’s traditional stability on its head.  Anger is brewing below the surface everywhere and the probability of social and political uprisings throughout the globe are increasing.

 

How $21 Trillion in U.S. Tax Money Disappeared. “Full Scope Audit” of the Pentagon

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Image: a trillion dollars in stacks of $100 bills. Multiply that by 21

By David DeGraw

Source: Changemaker Media and Global Research

This is part of our series on the unaccounted for $21 Trillion in taxpayer money. As unbelievable and absurd as that sounds, the actual total of unaccounted for money at the Pentagon is most likely significantly more than $21 trillion. The First ever “full-scope audit” of the Pentagon is presently underway. Read the first report from this series here.

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According to the Department of Defense Inspector General and the Defense Finance and Accounting Service, $21 Trillion in Taxpayer Funding Is Unaccounted For.

To help people comprehend the scale of this, $1 Trillion is $1000 Billion. This means that $21,000 Billion in taxpayer money has gone missing.

How can this be possible?

We outlined the “Unaccountable System of Global War Profiteers” in detail here.

For further understanding, we are featuring another mind-blowing Department of Defense Inspector General (DOD IG) report.

The following are highlights from the DOD IG “Summary of DOD Office of the Inspector General Audits of Financial Management”:

  • The financial management systems DOD has put in place to control and monitor the money flow don’t facilitate but actually “prevent DOD from collecting and reporting financial information… that is accurate, reliable, and timely.” (p. 4)
  • DOD frequently enters “unsupported” (i.e. imaginary) amounts in its books (p. 13) and uses those figures to make the books balance. (p. 14)
  • Inventory records are not reviewed and adjusted; unreliable and inaccurate data are used to report inventories, and purchases are made based on those distorted inventory reports. (p. 7)
  • DOD managers do not know how much money is in their accounts at the Treasury, or when they spend more than Congress appropriates to them. (p. 5)18
  • Nor does DOD “record, report, collect, and reconcile” funds received from other agencies or the public (p. 6),
  • DOD tracks neither buyer nor seller amounts when conducting transactions with other agencies. (p. 12)
  • “The cost and depreciation of the DOD general property, plant, and equipment are not reliably reported….” (p. 8);
  • “… the value of DOD property and material in the possession of contractors is not reliably reported.” (p. 9)
  • DOD does not know who owes it money, nor how much. (p. 10.)

It gets worse; overall:

  • “audit trails” are not kept “in sufficient detail,” which means no one can track the money;
  • DOD’s “Internal Controls,” intended to track the money, are inoperative. Thus, DOD cost reports and financial statements are inaccurate, and the size, even the direction (in plus or minus values), of the errors cannot be identified, and
  • DOD does not observe many of the laws that govern all this.

It is as if the accountability and appropriations clauses of the U.S. Constitution were just window dressing, behind which this mind-numbing malfeasance thrives.

Technically, this is a violation of the Anti-Deficiency Act, a statute carrying felony sanctions of fines and imprisonment.

Congress and the Pentagon annually report and hold hearings on DOD’s lack of financial accountability and sometimes enact new laws, but many of the new laws simply permit the Pentagon to ignore the previous ones; others are eyewash.

If you have a system that does not accurately know what its spending history is, and does not know what it is now (and does not care to redress the matter), how can you expect it to make a competent, honest estimate of future costs?

It is self-evident that an operation that tolerates inaccurate, unverifiable data cannot be soundly managed; it exempts itself from any reasonable standard of efficiency.

Recall, also that the errors in cost, schedule and performance that result are not random: actual costs always turn out to be much higher than, sometimes even multiples of, early estimates; the schedule is always optimistic, and the performance is always inflated.

The Pentagon, defense industry and their congressional operatives want – need – to increase the money flow into the system to pretend to improve it.

Supported by a psychology of excessive secrecy, generated fear and the ideological belief that there is no alternative to high cost, high complexity weapons, higher budgets are easier to justify, especially if no one can sort out how the Pentagon actually spends its money.

The key to the DOD spending problem is to initiate financial accountability. No failed system can be understood or fixed if it cannot be accurately measured.

And yet, there is no sense of urgency in the Pentagon to do anything about it.

Indeed, in the 1990s, we were promised the accountability problem would be solved by 1997. In the early 2000s, we were promised it would be solved by 2007; then by 2016; then by 2017….

The question must be asked: if nothing has been done by the Pentagon to end the accountability problem after more than 20 years of promises, is top management simply incompetent, or is this the intended result of obfuscation to avert accountability?

A spending system that effectively audits its weapon programs and offices would also be one that systemically uncovers incompetent and crooked managers, false promises and those who made them.

It would also necessarily reveal reasons to dramatically alter, if not cease, funding for some programs, which of course would make lots of people in industry, Congress, and the executive branch unhappy.

The current system and its out of control finances mortally harm our defenses, defraud taxpayers, and bloat the Pentagon and federal budgets.

Any reform that fails to address this most fundamental problem is merely another doomed attempt that will only serve to perpetuate a system that thrives on falsehoods and deception.

William Hartung, Director of the Arms and Security Project at the Center for International Policy, summed up the accountability crisis at the Pentagon by saying:

“Call it irony or call it symptomatic of the department’s way of life, but an analysis by the Project on Government Oversight notes the Pentagon has so far spent roughly $6 billion on ‘fixing’ the audit problem — with no solution in sight.

If anything, the Defense Department’s accounting practices have been getting worse.”

The above post was an excerpt from The Pentagon Labyrinth, 10 Short Essays to Help You Through It. It was written by, “10 Pentagon Insiders, Retired Military Officers and Specialists With Over 400 Years of Defense Experience.” The section we featured is from Essay #8, Decoding the Defense Budget: The Ultimate in Cooked Numbers, by Winslow T. Wheeler. * Report Full PDF Here *

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This article was originally published on Changemaker.media.

What’s Wrong with the Economy: 9 Toxic Dynamics

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By Charles Hugh Smith

Source: Of Two Minds

These nine dynamics are mutually reinforcing.

Beneath the surface signals of an eternally rising stock market and expanding GDP, we all sense something is deeply, systemically wrong with the U.S. economy. These nine structural dynamics generate secondary dynamics, all of which are toxic to social mobility, sustainable prosperity, accountability and democracy:

1. The financialization of the economy, which transformed services, credit, risk and labor into commodities that could be traded globally. Financialization generates enormously asymmetric returns: those with access to low-cost credit, global markets and expertise in finance collect the lion’s share of gains in income and wealth.

2. The technological transformation of the economy, which has placed a substantial scarcity premium on specific tech/managerial/communication skills and devalued ordinary labor and capital. As a result, the majority of gains in wealth and income flow to those with the scarce skills and forms of capital, leaving little for ordinary labor and capital.

3. The end of cheap fossil fuels. The fracking boom/bubble has obscured the long-term secular trend: the depletion of cheap-to-access and process oil. As many analysts have observed (Nate Hagens, Gail Tverberg, Richard Heinberg, Chris Martenson et al.), the global economy only grows if energy and credit are both cheap.

4. Globalization, which transformed the developing world into the environmental dumping ground of the wealthy nations and enabled the owners of capital to offshore waste and labor.

5. The destructive consequences of “growth at any cost” are piling up. “Growth” is the one constant of all existing political-economic systems, and none of the current Modes of Production (i.e. the structures that organize production, consumption, the economy and society) recognize that “growth” is not sustainable.

The first two dynamics drive three other dynamics that have hollowed out the productive economy:

6. The dominance of debt-funded speculation as the means of “getting ahead” as opposed to producing products and services of intrinsic value that serve the core needs of communities.

7. The economy’s gains in income and wealth are concentrated in the very top of the wealth-power pyramid: the top 5%–entrepreneurs, professionals and technocrats, etc., and within this class, most of the gains go to the top 1/10th of 1% –the existing owners of wealth, and financiers/speculators with access to cheap credit.

The net result is the bottom 95% have few opportunities to “get ahead” outside of gambling in the asset bubbles du jour: the stock and housing market. While the average middle class household may be able to borrow enough to speculate in the housing bubble, two factors limit the odds of success for ordinary investors/gamblers:

A. The gains in housing are concentrated in specific markets; outside these hot markets, gains are modest.

B. Asset bubbles eventually pop, leaving those still owning the assets with losses. The risks are thus intrinsic and high. The average investor/gambler lacks the experience needed to recognize the bubble has stopped expanding and exit the market before ll the other speculators rush for the narrowing exit.

8. The devaluation of ordinary labor and capital means the bottom 60% of the economy that lacks the requisite skills with a scarcity premium in the Emerging Economy have lost easy access to the ladder of social mobility.

9. The concentration of wealth and power in the hands of the self-serving few corrupts the economy and democracy. The U.S. economy is dominated by insider and elite rackets, skims, scams and cartels/quasi-monopolies, all of which corrupt the economy by creating perverse incentives for exploitation and gaming the system to benefit the few at the expense of the many.

This corruption in service of maximizing private/personal gains at the expense of the system itself also corrupts the mechanisms of governance, which are now little more than cloaking devices that protect insiders and elites from scrutiny and consequences.

The 20% above the bottom 60% may appear to have some access to social/economic mobility, but this is largely an artifact of the bubble economy since 2009. Once the bubble deflates, the illusion of social mobility for the “middle class” between the bottom 60% and the upper 20% vanishes.

The “upper middle class” between the bottom 80% and the top 5% is being squeezed by the over-production of elites, i.e. the over-abundance of those with college degrees and the relative scarcity of secure jobs within the top 5%. As a result, credential inflation is rampant, with Masters Degrees replacing Bachelors Degrees as the default for a white-collar job, and PhDs replacing Masters diplomas as the new default for positions that lack security and upward mobility.

In other words, the number of people who qualify for and desire a slot in the elite class (top 5%) far exceeds the number of slots available. As Peter Turchin has explained, this competition generates social disorder at the top of economic heap as the top 20% fight over the few positions open in the top 5%. The disgruntled, frustrated losers far outnumber the relatively few winners.

These nine dynamics are mutually reinforcing, meaning that each dynamic strengthens one or more of the others, reinforcing each other so the sum of the nine is far more powerful than a mere addition might suggest.

The New Aristocracy (the top 9.9%) (The Atlantic)

 

Inequality Social Dysfunction and Misery

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By Graham Peebles

Source: Dissident Voice

Year on year the economic divisions and sub-divisions in the world deepen, the associated social ills increase: The rich, comfortable, and the very extremely rich keep getting richer, and the rest, well, whilst some may be raised up out of crippling poverty into relative poverty, the majority of people continue to live under a blanket of economic insecurity and largely remain where they are.

Straddling the global ladder of economic and social division sit the Multi-Billionaires (there are now 2,208 billionaires), 42 of whom (down from 61 in 2016), according to a recent report by Oxfam, own the same amount of wealth as the poorest half of humanity combined. Together with their lesser cohorts this coterie of Trillionaires sucked up “eighty-two percent of the wealth generated [in the world] last year…while the 3.7 billion people who make up the poorest half of the world saw no increase in their wealth.”

The defining challenge of our time

Income and wealth inequality is not simply a monetary issue, it is a complex social crisis that supports and strengthens notions of superiority and inferiority, and was described by President Barak Obama in 2013 as “the defining challenge of our time.”

Today’s obscene levels of inequality are the result of the Neo-Liberal economic system. This extreme form of capitalism took hold first in America and Britain in the early 1980s when Reagan and Thatcher ruled, workers’ rights were trampled on, ‘society’ was a dirty word and community responsibility was abandoned to selfishness and greed. With the aid of the World Bank and the IMF, Neoliberalism swiftly spread throughout the world, polluting life in every city, town and village with its divisive, cruel ideology. Commercialization and competition are key principles and have infiltrated every area of contemporary life; everything and everyone is seen as a commodity, and the size of ones bank account determines the level of health care, education and housing available, as well as one’s access to culture and freedom to travel.

Social injustice is inherent in the system, as is inequality, which is itself a major form of injustice. Inequality strengthens deep-seated social imbalances based on class and social standing, and in a world where everything is classified, commercialized and priced; i.e., attributed value, external wealth and position have become the common criteria for determining the internal worth of a human being. Comparison and imitation follow, individuality is perverted and fear fostered; fear of inadequacy, fear of failure, fear of not being loved, because not ‘deserving’ love, not being able to ‘afford’ love. Resentment, anger and self-loathing are fed, leading to a range of mental health issues, including anxiety, depression and drug and alcohol addiction.

Happiness and inequality

The impact of financial inequality on the health and well being of society has been extensively studied by Richard Wilkinson; British co-author of Spirit Level, Professor Emeritus of Social Epidemiology at the University of Nottingham. In order to establish national levels of inequality Wilkinson and his team used a benchmark based on how much richer the top 20% is to the bottom 20%: Japan and Scandinavia (Finland, Norway, Sweden, Denmark) came out most equal, and now, Slovenia and the Czech Republic have moved towards this group. Israel, New Zealand, Australia, Britain, Portugal and USA were found to have the greatest levels of inequality, and by some margin. Recent data suggests that Russia, South Africa and Turkey should now be added to the most unequal pile. Germany, Spain and Switzerland sit somewhere in the middle.

Data relating to a range of social issues was examined: The most unequal countries were found to have lower life expectancy than more equal societies, higher infant mortality, many more homicides, larger prison populations (by 10-15 times), applied longer sentences; had higher teenage pregnancies, lower mathematic/literacy levels, more obesity, less social mobility, and, according to The World Value Survey, a great deal less trust. In more equal countries, like Sweden and Norway, around 65% of people trust others, whereas in unequal societies like America a mere 15% admitted to trusting their fellow citizens.

In all areas, countries with high levels of inequality did worse, in many cases much worse, than more equal nations. Mental health, for example, (figures from the World Health Organization): In Japan around 8% of the population suffers from some form of mental health issue, compared to 30% in America. Children are considerably healthier in more equal countries – based on UNICEF’s Index of Child Well-Being – and feel a good deal happier. Wilkinson concludes, “What we’re looking at is general social dysfunction related to inequality. It’s not just one or two things that go wrong, it’s most things.”

Look to Scandinavia

If one of the primary purposes of any socio-economic system is to create environments in which human beings can grow and live happily together, then the nations suffering under the shadow of inequality need to learn from Sweden, Norway, Denmark and Finland, which are not just the least unequal, they are also the happiest countries in the world. Throughout Scandinavia public services – education (which is probably the best in the world), health care and housing, are valued, and taxes levied in order to fund them properly; there are greater levels of social justice, this allows for trust to develop, and where there is trust relationships flower. The extremes of staggering wealth and stifling poverty don’t exist as they do in the more unequal parts of the world; social mobility is greater and the dream of betterment more realistic, as Richard Wilkinson says, “if Americans want to live the ‘American dream’ they should go and live in Denmark.”

The first duty of government is to protect the people; this involves not only dealing with terrorism and the like, but requires the development of socio-economic policies that contribute to the creation of a healthy harmonious environment. By supporting extreme inequality (which has been shown to fuel a range of social issues) governments in the more unequal countries are totally failing in this fundamental duty. Politicians, who in many cases rely on big business and wealthy benefactors for their funding, are either blind to, or negligent of, the inherent faults of the current system, and the unhealthy, negative way of life it supports.

The case for fundamental change in the economic order, and a shift away from the destructive values it promotes is becoming irrefutable; however, change occurs only gradually and resistance is great. In the meantime, governments (particularly in the most unequal states) need to acknowledge the connection between the dysfunction and disease within society and their socio-economic methodology, which is literally making people ill, as well and poisoning the natural world. They need to invest properly in public services, address wage differences, ban bonuses, introduce progressive tax reform, and, unlike America and France which are taking retrograde steps by designing tax codes which will fuel inequality, look to the Scandinavian countries and learn from their example.

For too long socio-economic systems have been designed and maintained to cater to the desires and interests of a privileged few, while the majority live inhibited lives under the shadow of financial uncertainty. For harmonious societies to evolve this long-standing injustice needs to be addressed and a degree of balance found. This requires that those whose table is full to overflowing share some of their bounty, so that all may have enough, not excess, enough.

As a wise man has said, “The rich must give up what they want, so that the poor can have what they need.” What the rich and comfortable must give up is greed (another car, another house, more designer clothes, etc.), what the rest need is freedom from economic insecurity and the fear of destitution, freedom from exploitation and dependency; secure, comfortable, and well-designed accommodation, and access to good education, health care and culture. Such essential needs are the rights of all; when made manifest they go a long way towards establishing social justice, and where there is social justice, functional, compassionate communities do evolve, conflict is reduced and collective harmony is cultivated.