Tag Archives: 1%

Assets of world’s “high net wealth” millionaires surged to $70 trillion in 2017

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By Barry Grey

Source: WSWS.org

The concentration of the planet’s wealth in the hands of a narrow financial elite is growing by leaps and bounds. A new report published Tuesday reveals that the wealth of the world’s 18.1 million “high net worth individuals”—those having investable assets of $1 million or more—shot up by 10.6 percent last year to top $70 trillion for the first time ever.

The “World Wealth Report 2018,” issued by the consulting firm Capgemini, revealed that the combined wealth of the world’s millionaires rose for the sixth consecutive year in 2017 to reach $70.2 trillion. It is on target to surpass $100 trillion by 2025.

Capgemini defines a high net wealth individual (HNWI) as someone with assets above $1 million, excluding his or her primary residence, collectibles, consumables and consumer durables. This defines a wealthy elite that owns more than $1 million in stocks, bonds, real estate or other investments.

The number of HNWIs grew almost 10 percent, or 1.6 million. The United States, Japan, Germany and China are the four largest markets for millionaires, accounting for 61 percent of the world’s HNWIs. The US tops the list with 5.3 million HNWIs, a 10 percent increase from 2016.

However, the Asia-Pacific region has most of these millionaires overall and accounted for the bulk of the increase in both the number of HNWIs (74.9 percent of the total) and the rise in their global wealth (68.8 percent). Economic inequality appears to be rising faster in this region than any other. Japan saw a 9 percent increase in HNWI millionaires, China an 11 percent rise and India a stunning 20 percent increase.

The financial oligarchy itself resides within what the report calls “ultra-high net wealth individuals,” those with $30 million or more in investable assets. They comprise only 1 percent of HNWIs, or 174,000 individuals, but they account for a vastly disproportionate share of the overall wealth of HNWI millionaires, as well as the increase in HNWI wealth. These ultra-HNWIs own some 35 percent of total NHWI wealth. In 2017, their ranks grew by 11.2 percent and their wealth by 12 percent, reaching $24.5 trillion.

The main factor driving the rapid enrichment of the financial aristocracy is the record rise in stock prices. “High net worth individuals around the world enjoyed investment returns above 20 percent for the second year in a row,” Anirban Bose, head of Capgemini’s financial services global strategic business unit, wrote in the report’s preface. The report noted that global market capitalization grew 21.8 percent in 2017.

The stock market has served as the primary mechanism for central banks and governments around the world to increase the wealth of the financial oligarchy, which dominates the world economy and all of the official institutions of society and dictates the policies of governments. For decades, the central banks, led by the US Federal Reserve, working in tandem with governments of the nominal “left” no less than the right, have deliberately engineered a vast transfer of wealth from the working class to the ruling elite by pursuing policies designed to pump up the financial markets.

These polices have been intensified since the 2008 financial crash. The Fed and the US government, first under Bush and then Obama, responded to the Wall Street meltdown by enacting measures to ensure that the oligarchs recouped all of their losses and were able to exploit the crisis to further enrich themselves. In addition to bailing out the banks and hedge funds with trillions of dollars in tax-payer money, they provided virtually free credit to Wall Street by means of near-zero interest rates and used “quantitative easing”—a euphemism for money-printing—to offload the banks’ bad loans onto the Fed’s balance sheet.

From the low-point of the post-crash recession in March 2009 to the present, US stock prices have risen four-fold, stoking a similar stock bonanza internationally.

This stock market boom and the entire process of social plunder have depended on the suppression of working class opposition and a savage attack on workers’ living standards by means of austerity and wage-cutting. The throttling of the class struggle has been contracted out to the trade unions, the industrial police agencies of the ruling class.

One of the most significant findings in the Capgemini report is that the total financial wealth of the world’s HNWIs more than doubled between 2008 and 2017, rising from $32.8 trillion to $70.2 trillion. This same period has seen, in the world inhabited by the vast majority of humans, a growth of poverty, hunger, homelessness, disease and, in the United States, a decline in life expectancy, a surge in infant and maternal mortality, and record rates of suicide and drug addiction.

This attack has continued and intensified under Trump, as well as governments in Europe, Latin America and Asia. Just last week the Federal Reserve raised interest rates and announced a tightening of monetary policy in response to the growth of workers’ strikes and protests. The oligarchy is petrified that lower unemployment and a tight labor market will encourage a militant wages movement that would undercut the entire basis of the stock market surge. It is moving to slow the economy and drive up unemployment.

To place the wealth of the world’s multi-millionaires and billionaires in perspective, the total of $24.5 trillion owned by “ultra-high net wealth individuals” is almost one-fifth of the world gross domestic product of $135 trillion.

$24.5 trillion is more than the GDP of the United States. It is more than the combined GDPs of the next three countries—China, Japan and Germany.

Just the global increase in ultra-HNWI wealth in 2017, $2.6 trillion, is larger than the GDPs of countries such as Italy, Brazil, Canada and Russia.

What could this money be used for were it not squandered to satisfy the demands of the rich and the super-rich for mansions, private jets and yachts? To give an example, the United Nations estimates it would cost $30 billion a year to eradicate world hunger. That means the money currently controlled by the world’s ultra-HNWIs could eliminate world hunger for 817 years.

The “World Wealth Report 2018” is only the latest in a wave of studies documenting the ever tightening grip of a tiny financial oligarchy and its ultra-wealthy periphery over the world’s resources. Wealth concentration on such a scale makes it impossible to seriously address a single social issue. The staggering diversion of resources into private wealth accumulation by the financial oligarchy starves society of the resources it needs to deal with the most basic problems.

The working class has no choice but to confront head-on the problem of economic inequality. The financial elite enforces its social interests through the wholesale buying of political parties and politicians, making democracy under capitalism nothing but a hollow shell. Any attempt within the framework of the profit system to carry out a modest reallocation of resources to ensure that all people had the basic rudiments of nutrition, health care and education would provoke a furious response from the oligarchy, which has at its disposal not only the courts, politicians and mass media, but, even more decisively, the police and the army.

When social reform becomes impossible, social revolution becomes inevitable. There is no avoiding the conclusion that it is necessary to expropriate the wealth of the financial oligarchs.

Twelve Tips For Making Sense Of The World

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By Caitlin Johnstone

Source: CaitlinJohnstone.com

In an environment that is saturated with mass media propaganda, it can be hard to figure out which way’s up, let alone get an accurate read on what’s going on in the world. Here are a few tips I’ve learned which have given me a lot of clarity in seeing through the haze of spin and confusion. Taken separately they don’t tell you a lot, but taken together they paint a very useful picture of the world and why it is the way it is.

1. It’s always ultimately about acquiring power.

In the quest to understand why governments move in such irrational ways, why expensive, senseless wars are fought while homeless people die of exposure on the streets, why millionaires and billionaires get richer and richer while everyone else struggles to pay rent, why we destroy the ecosystem we depend on for our survival, why one elected official tends to advance more or less the same harmful policies and agendas as his or her predecessor, people often come up with explanations which don’t really hold water.

The most common of these is probably the notion that all of these problems are due to the malignant influence of one of two mainstream political parties, and if the other party could just get in control of the situation all the problems would go away. Other explanations include the belief that humans are just intrinsically awful, blaming minorities like Jews or immigrants, blaming racism and white supremacy, or going all the way down wild and twisted rabbit holes into theories about reptilian secret societies and baby-eating pedophile cabals. But really all of mankind’s irrational behavior can be explained by the basic human impulse to amass power and influence over one’s fellow humans, combined with the fact that sociopaths tend to rise to positions of power.

Our evolutionary ancestors were pack animals, and the ability to rise in social standing in one’s pack determined crucial matters like whether one got first or last dibs on food or got to reproduce. This impulse to rise in our pack is hardwired deeply into our evolutionary heritage, but when left unchecked due to a lack of empathy, and when expanded into the globe-spanning 7.6 billion human pack we now find ourselves in due to ease of transportation and communication, it can lead to individuals who will keep amassing more and more power until they wield immense influence over entire clusters of nations.

2. Money rewards sociopathy.

The willingness to do anything to get ahead, to claw your way to the top, to betray whomever you need to, to throw anyone under the bus, to step on anyone to pass them in the rat race, will be rewarded in our current system. Being willing to underpay employees, cheat the legal system, and influence legislators will be rewarded exponentially more. People with a sense of empathy are often unwilling to do such things, whereas sociopaths and psychopaths are. About four percent of the population are sociopaths, and about one percent are psychopaths, with some five to fifteen percent falling somewhere along the borderline. The less empathy you have, the further you are willing to go, and the further up the ladder you can climb.

3. Wealth kills empathy.

If that weren’t bad enough, studies have shown that controlling large amounts of wealth actually destroys one’s sense of compassion for one’s fellow man. When you are able to use wealth to obtain everything from security to loyalty to personal relationships, you no longer have to be tuned in to the brain’s empathy center the rest of humanity depends on to get an accurate reading on what’s going on with the people we’re surrounded by. Most people need to be constantly feeling around their families, coworkers, employers, friends and acquaintances in order to ensure their own safety, social standing and security, whereas a wealthy person can simply purchase those things. Being born into wealth or having it for a long time can prevent that sense of empathy from being as strong as it is in the rest of the population.

4. Money is power.

A 2014 Princeton study showed that ordinary Americans have essentially zero influence over their nation’s policy and behavior regardless of how they vote, while wealthy Americans have a great deal of influence. This is because the ability to use corporate lobbying and campaign donations effectively amounts to the legalized bribery of elected officials, which means that money translates directly into political power. This creates a ruling class which is naturally incentivized to use their influence to increase their own wealth while decreasing everyone else’s, because since power is relative, the less money everyone else has the more power the ruling class has.

This is why billionaires keep hoarding more and more wealth while using legalized bribery to stifle economic justice legislation. It isn’t because they want to be able to buy thousands of luxury cars or dozens of private jets; they can only use one at a time the same as everyone else. They hoard wealth to keep the rest of the population from having it. Because money equals power, spreading wealth around would be tantamount to making everyone king, and because power is relative, making everyone king would mean that no one is king.

Rulers, historically, do not give up power easily, and this elite wealthy class is no exception. Hence all their aggressive attempts to suppress any movement against the status quo from the unwashed masses.

5. This same ruling class controls the media.

It’s common knowledge that most media is controlled by plutocrats, whether it’s the old money plutocrats who control the legacy media or the new money Silicon Valley plutocrats who control much of the new media. Media control is an essential component of rule; this has always been the case, since the days when kings would order dissident books burned and bishops would torture dissident orators to death. This is why the first thing a new plutocrat does as soon as rising to a certain level of wealth is start buying up media influence, like Jeff Bezos did when he bought the Washington Post in 2013. Bezos bought WaPo not because he is a stupid businessman who thought newspapers were about to make a lucrative resurgence, but because he is a brilliant businessman who knows that the status quo he is building his empire upon requires a propaganda firm that the public will trust and believe.

6. People are always manipulating each other.

Cultivating an acute awareness of when you are being manipulated, and considering whether someone might have a motive to do so, is an essential component to making sense of the world.

It is very rare to encounter someone who won’t try to manipulate you in any way. Generally people you’ll encounter in your life will try to influence the way you perceive them and your relationship to them, they’ll try to pull you in in some ways and push you out in others, try to hook you up to their personal agendas and goals and shape you in a way that fits with their shape. There’s nothing inherently malevolent in such behavior, it’s just what people do and what they always have done. Again, humans are social creatures, and we do what we can to increase our standing within our social circles.

The big problem is when skillful manipulators find their way into positions of large-scale influence like government or media. Unfortunately, these are the types who tend to get elevated into such positions, because they can manipulate their way in, and generally they do so for reasons of personal ambition rather than altruism. These skillful manipulators form an essential echelon of the ruling class’ loyal servants, and are the minds behind the pro-establishment narratives you’ll suddenly see circulated from think tanks to media platforms to the establishment lackeys on Capitol Hill.

7. Society is made of narrative.

Most of human experience is filtered through our mental stories about it, from our sense of self, to our ideas about who we are, to our beliefs about how we’re supposed to behave in society, to what money is and how it works, to where power exists and who we’re supposed to obey. All of these things are purely conceptual constructs which only exist in the realm of thought; a “dollar” exists to the extent that we’ve all agreed to pretend it’s a real thing and that it has a certain amount of purchasing power. At any time we could collectively decide to change the rules about how power functions or what money is and how it operates, and then instantly the rule of the elite class would be over without anyone firing a shot. It really would be that simple.

That’s how powerful a force narrative is, which is why the ruling plutocrats fight so hard to keep us from seizing control of it. This is why whistleblowers and outlets like WikiLeaks are aggressively and constantly smeared and demonized in the corporate media; if they can create suspicion of truth-tellers then they can keep them from being trusted, and thus keep them from being believed. This tool has been used to minimize the impact of everything from on the ground reports of what’s happening in Syria to leak drops from Edward Snowden; if you can create enough suspicion of someone it doesn’t matter if they’re speaking 100 percent truth; nobody will believe them, and thus the dominant narrative will remain the same.

Maintaining an awareness that there is always an unending battle to control the narrative and manipulate it to advance plutocratic interests is an essential part of understanding the world.

8. The lines between nations are imaginary.

Those lines drawn on the map between countries are pure narrative as well; they’re only as real as the collective public agrees to pretend they are. The ruling elites know this and exploit this. They don’t think in terms of nations and governments, they think in terms of individuals and groups of individuals.

Key strategic region in the Middle East? No need to take over the whole country, just flood it with extremist groups who are loyal to your agendas and control its oil fields. Primo naval real estate in the southern hemisphere? No need to annex it and plant your country’s flag there, just secure enough influence over the important moving parts using corporate contracts, trade agreements, military/intelligence treaties and secret deals and you can use it however you want.

This is why I am dismissive of arguments that “Israel controls America” or “America controls Europe”. There is no “Israel” or “America”; they’re made-up ideas which rulers once upon a time treated as real, but in the modern days of nationless plutocracy they no longer do. There are individuals, there are corporations, there are government agencies, there are factions and groups, and these are what the ruling elites deal with. Governmental structures are only tools which are used by the ruling elites for the purpose of manipulation, control, and military violence, and they only do so insofar as it is useful. The idea of real nations and governments is a cutesy fairy tale sold to the masses so they won’t see the manipulations.

9. Powerful forces are naturally incentivized to collaborate with each other toward mutual interests.

You can be a low-grade millionaire and still live like a relatively normal civilian, but once you start obtaining giant amounts of wealth control you need to start collaborating with existing power structures or they’ll snuff you out to prevent you from rocking their boat, because again, money equals power. This is why Jeff Bezos contracts with the CIA and sits on a Pentagon advisory board, and it’s why Facebook and Google collaborate extensively with government agencies; they never would have been allowed to grow to their size if they had not. Plutocratic dynasties which have been in place since long before Amazon, Facebook and Google figured this out many generations ago, and have agreed to push forward in a direction of mutual interest that doesn’t upset the status quo that their wealth is built upon.

This is extremely true of the west, where an effective empire has been created by a complex transnational alliance of mostly western plutocrats, but it is true outside of that empire as well; there are power alliances to be found everywhere that there is power.

10. There is an immense amount of wealth that can be grabbed in the chaos of war and conflict.

In the same way that existing power structures are naturally incentivized to quash any emerging power which would upset their status quo, alliances of power structures push to crush non-aligned power structures the world over. Whenever you see the tight western alliances and their media propaganda arms attacking the interests of Russia, China, Syria, Iran, Venezuela etc., you are seeing an alliance of power structures working to disrupt the interests of another alliance of power structures in order to absorb their assets.

The chaotic, Wild West environments that these conflicts create allow for an amount of underhanded looting and pillaging that you could never get away with in your own country, in the exact same way the colonialists and conquistadors of old could never have gotten away with brazenly grabbing gold, land and slaves from their fellow Europeans in Madrid or Rome but were given no legal trouble in the new world. The colonialists and conquistadors pushed into the Americas, Africa and Asia on the pretense of spreading Christianity and civilization; modern day conquerers push into non-aligned power structures on the pretense of spreading freedom and democracy in precisely the same way.

This chaos doesn’t require direct military conflict to be profitable; the uncritical enmity against Russia that the western plutocratic alliance has manufactured with its media control has allowed them to be blamed for everything from incriminating WikiLeaks documents to a corporate raid by Ukrainian oligarchs without any questions asked. Anyone who has ever had to deal personally with a sociopath knows how much they love to exploit the gray areas that chaotic situations give them, and geopolitical conflicts create those situations in spades.

11. The neocons are always wrong.

This one’s really easy. If you ever want to be on the right side of history for a foreign policy debate, look at what Bush-era PNAC neocons like John Bolton and Bill Kristol are saying about it, and take the opposite position. Neocon thought leaders have been loudly and catastrophically wrong about everything since the turn of the century, from Afghanistan to Iraq to Libya to Syria, and they’re not about to start being right now.

12. The push towards truth always starts with yourself.

You can’t out-manipulate seasoned manipulators. The main error most people make when trying to deal with a sociopath is to try and manipulate them back. Don’t even try. They have years of experience on you because they literally have done nothing else. While you were laughing and crying and worrying and connecting and relating to people, they were working out how to play humans like Garry Kasparov worked out how to play chess. And when you have literal teams of sociopaths collaborating together to amass power, you my dear child, do not have a chance. Don’t play their game. You will lose.

The only way to win this is to set your compass resolutely to “true.” Always be honest with yourself. Find all the different ways that you are manipulating others and see them and acknowledge them. Find your tribal allegiances and your desire to be right, and tip your hat to their existence. The more self-aware we are, the less levers we have to be manipulated by. If you are blindly partisan or loyal to a particular faction, that makes you gullible to propaganda because your wishful thinking and your desire to be right come into play. Get honest with yourself about who you are and what you want, and you will start to become an un-playable piece on the board.

If we can’t beat these bastards with truth, we don’t deserve to win.

A 2% Financial Wealth Tax Would Provide A $12,000 Annual Stipend To Every American Household

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Careful analysis reveals a number of excellent arguments for the implementation of a Universal Basic Income.

By Paul Buchheit

Source: Nation of Change

It’s not hard to envision the benefits in work opportunities, stress reduction, child care, entrepreneurial activity, and artistic pursuits for American households with an extra $1,000 per month. It’s also very easy to justify a financial wealth tax, given that the dramatic stock market surge in recent years is largely due to an unprecedented degree of technological and financial productivity that derives from the work efforts and taxes of ALL Americans. A 2% annual tax on financial wealth is a small price to pay for the great fortunes bestowed on the most fortunate Americans.

The REASONS? Careful analysis reveals a number of excellent arguments for the implementation of a Universal Basic Income (UBI).

(1) Our Jobs are Disappearing

A 2013 Oxford study determined that nearly HALF of American jobs are at risk of being replaced by computers, AI, and robots. Society simply can’t keep up with technology. As for the skeptics who cite the Industrial Revolution and its job-enhancing aftermath (which actually took 60 years to develop), the McKinsey Global Institute says that society is being transformed at a pace “ten times faster and at 300 times the scale” of the radical changes of two hundred years ago.

(2) Half of America is Stressed Out or Sick

Half of Americans are in or near poverty, unable to meet emergency expenses, living from paycheck to paycheck, and getting physically and emotionally ill because of it. Numerous UBI experiments have led to increased well-being for their participants. A guaranteed income reduces the debilitating effects of inequality. As one recipient put it, “It takes me out of depression…I feel more sociable.”

(3) Children Need Our Help

This could be the best reason for monthly household stipends. Parents, especially mothers, are unable to work outside the home because of the all-important need to care for their children. Because we currently lack a UBI, more and more children are facing hunger and health problems and educational disadvantages.

(4) We Need More Entrepreneurs

A sudden influx of $12,000 per year for 126 million households will greatly stimulate the economy, potentially allowing millions of Americans to TAKE RISKS that could lead to new forms of innovation and productivity.

Perhaps most significantly, a guaranteed income could relieve some of the pressure on our newest generation of young adults, who are deep in debt, underemployed, increasingly unable to live on their own, and ill-positioned to take the entrepreneurial chances that are needed to spur innovative business growth. No other group of Americans could make more productive use of an immediate boost in income.

(5) We Need the Arts & Sciences

A recent Gallup poll found that nearly 70% of workers don’t feel ‘engaged’ (enthusiastic and committed) in their jobs. The work chosen by UBI recipients could unleash artistic talents and creative impulses that have been suppressed by personal financial concerns, leading, very possibly, to a repeat of the 1930s, when the Works Progress Administration hired thousands of artists and actors and musicians to help sustain the cultural needs of the nation.

Arguments against

The usual uninformed and condescending opposing argument is that UBI recipients will waste the money, spending it on alcohol and drugs and other ‘temptation’ goods. Not true. Studies from the World Bank and the Brooks World Poverty Institute found that money going to poor families is used primarily for essential needs, and that the recipients experience greater physical and mental well-being as a result of their increased incomes. Other arguments against the workability of the UBI are countered by the many successful experiments conducted in the present and recent past: Finland, Canada, Netherlands, Kenya, India, Great Britain, Uganda, Namibia, and in the U.S. in Alaska and California.

How to pay for it

Largely because of the stock market, U.S. financial wealth has surged to $77 trillion, with the richest 10% owning over three-quarters of it. Just a 2 percent tax on total financial wealth would generate enough revenue to provide a $12,000 annual stipend to every American household (including those of the richest families).

It’s easy to justify a wealth tax. Over half of all basic research is paid for by our tax dollars. All the technology in our phones and computers started with government research and funding. Pharmaceutical companies wouldn’t exist without decades of support from the National Institutes of Health. Yet the tech and pharmaceutical companies claim patents on the products paid for and developed by the American people.

The collection of a wealth tax would not be simple, since only about half of U.S. financial wealth is held directly in equities and liquid assets (Table 5-2). But it’s doable. As Thomas Piketty notes, “A progressive tax on net wealth is better than a progressive tax on consumption because first, net wealth is better defined for very wealthy individuals..”

And certainly a financial industry that knows how to package worthless loans into A-rated mortgage-backed securities should be able to figure out how to tax the investment companies that manage the rest of our ever-increasing national wealth.

 

Time To Make Life Hard For The Rich

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By Hamilton Nolan

Source: Splinter

It is time for polite, respectable, rational people to start saying what has become painfully obvious: It is time to stop respecting the rich, and start stealing from them. In earnest.

Inequality is eating America alive. It has been growing for decades. To say that “the American dream is dead” is no longer a poetic exaggeration—it is an accurate description of 40 years of wage stagnation and declining economic mobility that has produced a generation that cannot expect to live better than their parents did. Not because of devastating war or plague, but because of a very specific set of rules governing a very specific economic system that encourages the accumulation of great wealth among a tiny portion of the population, to the detriment of the vast majority of people. Our political and business leaders have chosen to embrace a system that favors capital over labor. A system in which the more you already have, the more you make, and the less you have, the harder it is to build wealth. It is a system designed to increase inequality. It is functioning exactly as designed. And now, it is about to get worse.

How long are people supposed to tolerate being smacked in the face? By the rich? Who already have more than enough? It is not as though the fact that inequality is a crisis is a fact that snuck up on anyone. Economists have seen the trend for decades, and the general public has been well aware of it since at least the financial crisis. Obama called it “the defining challenge of our time.” Thomas Piketty became a rock star by writing a very dry book about it. It’s not an underground thing. It is well known and well understood by the people in control of the institutions with the power to change it. The response to this dire situation by the Republican Party, which a wholly owned subsidiary of the American capital-holding class, has been to pass a tax bill that will horribly exacerbate economic inequality in this country. It is a considered decision to make a bad situation worse. It is a deliberate choice—during a time when the rich already have too much—to take from the poor in order to give the rich (including members of Congress and the President) more. That is not a metaphor. That is the reality. That is what the Republican party is about to accomplish on behalf of the donor class, calling it “middle class tax relief” in the face of mathematical proof to the contrary. Even to my cynical ass, the sheer fuck you-ness of this action towards the majority of the country is breathtaking. This is not just a failure to solve a severe problem; it is the expenditure of vast amounts of political capital to make the severe problem worse so that a tiny handful of people will get wealthier than anyone needs to be.

Ideally, in a democracy, elected leaders reflecting the interests of the people would pass taxes and regulations to reverse the growing inequality here. For that to happen, we would need to end gerrymandering and reform campaign finance and probably abolish the Senate and the Electoral College, and that’s just for starters. It is not imminent, in other words. Our broken political system, which is designed to reward money with political power, is actually moving in the opposite direction of a solution. Who is suffering because of this? Most Americans. Certainly the bottom 50% are acutely suffering—money that would have been in their paychecks has been instead funneled upwards into the pockets of the rich. Every desperate family that has found themselves coming up short for rent or food or medicine, every American who has downgraded her dreams and aspirations because they became financially implausible, has been directly harmed by the political and economic class war perpetuated by the rich, even if they cannot see the perpetrators with their own eyes. I think that people have been more than patient in the face of this slow-moving crisis. In 2009, when the markets crashed and millions were laid off, nobody rioted and kidnapped the financiers and burned their homes. The outcome of that lack of direct action is the situation we find ourselves in today.

Violence against people is morally wrong and a bad way to solve problems. But capital is different. One thing that would help to create the political environment conducive to solving the inequality problem would be to make the cost of accumulating all that capital too high to be worth it. In other words, to create a downside to being too rich. I have personally stood in a room full of hedge fund titans and billionaire investors warning one another explicitly that inequality must be addressed lest the U.S. become a place like Latin America, where rich people are forced to live behind walls, surrounded by armed guards, because of the very real risks from the rage of the poor. Rich people in this country do not want to live like that. If they see that they must stop being so greedy in order to enjoy their own freedom, they will stop being so greedy. Those conditions have to be created by people who want justice.

Our situation is absurd. Not since the Gilded Age has it been more clear that a few people have too much. Furthermore, the people with too much are investing in political clout to give themselves more. It’s just wrong. If the government won’t help, we have to help ourselves. Sticking up a billionaire on the street for $100 is not going to do it. But one can imagine other ways that angry Americans might express their dissatisfaction with our current division of wealth: A large-scale online attack against the holdings of the very rich; yachts sunk in harbors; unoccupied vacation homes in the Hamptons mysteriously burned to the ground. Sotheby’s auctions swarmed by vandals, Art Basel attacked by spraypaint-wielding mobs, protests on the doorsteps of right-wing think tanks, venomous words directed at millionaires as they dine in fancy restaurants. People have a right to life and safety, but property does not. A life spent screwing the little people so that you can acquire lots of stuff loses its allure when you know that all that stuff will be smashed to pieces by angry little people. It is not hard to put together a list of those who should be targeted—Forbes publishes it every year. Likewise, public campaign finance records give us a pretty good idea of exactly who is funding the politicians who are perpetuating this economic war on behalf of the rich.

It is nice to imagine a grand, well-targeted computer hack that would neatly transfer billions of dollars out of the accounts of, say, the Walton family and into a charity account that would disburse the money to the poor in untraceable ways. That seems far-fetched. Realistically, what people can do now is to start thinking about ways to make it uncomfortable to be too rich. Socially uncomfortable and otherwise. When the accumulation of great wealth ceases to be a praiseworthy endeavor and instead becomes viewed as a sick, greedy pastime whose only reward is the hatred of your fellow citizens and the inability to live comfortably without fear of your excessive property being destroyed, rich people will rethink their goals. Until then, inequality will keep rising, and everything, for most people, will continue to slowly, slowly get worse.

A Stock Market Primer, in Six Easy Steps

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By William Kaufman

Source: CounterPunch

What is the stock market?

1) It’s not real economic activity—it’s a form of mass hysteria or mass psychosis.

2) Stock prices reflect a mass-hysteria impression of the worth of a piece of paper you hold—a stock certificate. The worth of that piece of paper is sometimes tethered to some economic reality of some corporation—at least partially—but sometimes not. Often a stock price bears little relation to the economic health of a company, as illustrated in the wildly gyrating stock price-to-earnings ratios through the decades. Hence the stock price is often a matter of caprice, covert manipulation, and/or unfathomable crowd psychology, not necessarily real economic “health” or productivity.

If, say, you are fortunate enough to own a stock that has doubled or tripled in price, this does not mean that you have accrued new wealth—that stock valuation is meaningless as long as you still own the piece of paper (the stock certificate); you realize that wealth only by selling the stock. And if you do cash out—sell the piece of paper—to someone else, you are transferring to another person the hazard of seeing that valuation drop or evaporate—an opportune fobbing off of risk to someone else, a transfer of cash to you, but no real creation of wealth—just the passing on of a piece of paper in exchange for currency. Eventually, down the road, your gain will be someone else’s loss when the music stops playing and the last holder of the piece of paper finds there is no chair for him to land on—the stock market as Ponzi scheme.

If everyone or most people decide to sell their pieces of paper—to take their profits—all at once, then the stock prices tumble, so the idea that everyone can cash out and realize this imaginary wealth equally and universally is a mirage: if everyone tried to access it at once, it would evaporate. Hence the common notion that rising stock prices indicate a general increase in wealth or national prosperity is delusional. A stock crash does not erase billions or trillions in “wealth” overnight, as we are commonly told. There was never any “wealth” there to begin with, in the sense that a stock price rationally or measurably reflects the worth of tangible goods or services; that price is just a mass fever dream, a collective, chaotic, bidding war about the worth of pieces of paper.

3) The stock market is a swindle.

Much of the movement of these equities markets originates in the decisions of large funds or high-speed traders who have access to esoteric information, advanced algorithms, or trading networks from which Joe Trader, playing the market at home on his laptop, is excluded. Hence Joe Trader inevitably gets screwed. The author Michael Lewis draws the veil from this complicated high-tech rigging in a 2014 interview with CBS’s 60 Minutes:

Steve Kroft: What’s the headline here?

Michael Lewis: Stock market’s rigged. The United States stock market, the most iconic market in global capitalism is rigged.

Steve Kroft: By whom?

Michael Lewis: By a combination of these stock exchanges, the big Wall Street banks and high-frequency traders.

Steve Kroft: Who are the victims?

Michael Lewis: Everybody who has an investment in the stock market. . . .

Steve Kroft: And this is all being done by computers?

Michael Lewis: All being done by computers. It’s too fast to be done by humans. Humans have been completely removed from the marketplace. “Fast” is the operative word. Machines with secret programs are now trading stocks in tiny fractions of a second, way too fast to be seen or recorded on a stock ticker or computer screen. Faster than the market itself. High-frequency traders, big Wall Street firms and stock exchanges have spent billions to gain an advantage of a millisecond for themselves and their customers, just to get a peek at stock market prices and orders a flash before everyone else, along with the opportunity to act on it. . . . The insiders are able to move faster than you. They’re able to see your order and play it against other orders in ways that you don’t understand. They’re able to front run your order.

Steve Kroft: What do you mean front run?

Michael Lewis: Means they’re able to identify your desire to, to buy shares in Microsoft and buy ‘em in front of you and sell ‘em back to you at a higher price. It all happens in infinitesimally small periods of time. There’s speed advantage that the faster traders have is milliseconds, some of it is fractions of milliseconds. But it’s enough for them to identify what you’re gonna do and do it before you do it at your expense.

4) The MSM commentators on the markets are all industry touts.

Their unvarying counsel, under all circumstances, is this: Get into the market. Get in if you’re not in already. Stay in if you’re already in. A plunge is a buying opportunity. A surge is a buying opportunity. A buying opportunity is that which puts a commission in their pockets. A mass exit from the stock market is the end of their livelihood. I don’t know the Latin term for the logical fallacy at work here, but I think the English translation is something like this: bullshit being slung by greedy con artists. These are people with no more conscience or expertise than the barking guy with the Australian accent on the three a.m. informercial raving about a miracle degreaser or stain remover.

5) This market, more than most, is a big fat bubble, ready to pop.

This bubble is a cloistered biosphere of Teslas and beach houses, of con artists, kleptocrats, and financial sorcerers. It is rigorously insulated from the dolorous real economy inhabited by the 99 percent: declining living standards; stagnant real hourly wages; lousy service-industry jobs; debilitating consumer and student debt peonage; soaring medical insurance premiums and deductibles that render many people’s swiss-cheese policies unusable; crumbling cities and infrastructure; climate disasters of biblical proportions; and toxic food, water, and air. This stock-market bubble has been artificially inflated by historically low interest rates (so the suckers have to go into the market to get a return on their money) and Fed “quantitative easing,” a technocratic euphemism for a novel form of welfare for the one percent that has left untold trillions of “liquidity” sloshing around among the financial elites with which to play Monopoly with one another and pad their net worth by buying back shares of their own companies to inflate stock prices. Moreover, this bubble is even more perilous and tenuous than previous ones because the “air” inside is being pumped by unprecedented levels of consumer and institutional debt that will cause a deafening “pop” when some of the key players start to lose their shirts, and suddenly all the Peters start calling in the debts of all the Pauls who can’t pay.

6) The end game is near. We can console ourselves that these latest innovations in financial prestidigitation and fraud are stretched about as far as they can go. The financial elites are out of three-card monte scams to suck the wealth out of the economy. The heroic productivist heyday of capitalism, celebrated by Marx himself, is over in this country—no more driven visionary builders of railroads, factories, skyscrapers, and highways to a better tomorrow: just endless financial skullduggery and hoarding at the top, and for the rest of us the cold comforts of cell phones, smart televisions, and the endless streams of plastic consumer junk circulating through Amazon and Walmart. What Baudrillard called “the mirror of production” is a prison for the planet earth and every species on it. All that is left for the bipartisan predator class of the United States is scavenging: massive tax breaks for the rich today and tomorrow, perhaps, no more Medicare, no more Social Security, no more public schools—if they have their way, and they probably will. Pop goes the stock market, the illusion of prosperity, the whole unsustainable carbon-poison “economy,” and pop goes the planet and the human race. But look at it this way: it’s a buying opportunity.

Why Fear and Self-hatred Destroy Human Sharing and Solidarity

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Photo by Adam Dean

By Robert J. Burrowes

As our world spirals deeper into an abyss from which it is becoming increasingly difficult to extricate ourselves, some very prominent activists have lamented the lack of human solidarity in the face of the ongoing genocide of the Rohingya. See ‘The Rohingya tragedy shows human solidarity is a lie’ and ‘Wrongs of rights activism around Rohingyas’.

While I share the genuine concern of the Yemeni Nobel peace laureate Tawakkol Karman and Burmese dissident and scholar Dr Maung Zarni, and have offered my own way forward for responding powerfully to the ongoing genocide of the Rohingya – see ‘A Nonviolent Strategy to Defeat Genocide’ – in my view the lack of solidarity they mention is utterly pervasive and readily evident in our lacklustre official and personal responses to the many ongoing crises in which humanity finds itself.

To mention just the most obvious: Every day governments spend $US2 billion on weapons and warfare while a billion people lack the basic resources to live a decent life (and more than 100,000 of these people starve to death). Every day millions of people live under dictatorship, occupation or suffer the impacts of military invasion. Every day another 28,800 people are forcibly displaced from their home. Every day another 200 species of life are driven to extinction. And every day our biosphere is driven one step closer to making human life (and perhaps all life) on Earth impossible. See ‘Killing the Biosphere to Fast-track Human Extinction’.

It is not as if any of this information is unavailable. Just as many people and major international organizations are well aware of the plight of the Rohingya, it is also the case that many people and these organizations are well aware of the state of our world in other respects. And still virtually nothing meaningful happens (although there are tokenistic responses to some of these crises).

Hence, it is a straightforward observation that human solidarity is notably absent in virtually any attempt to tackle the major issues of our time. And the Rohingya are just one manifestation of this problem.

Given that I have long observed this phenomenon both personally and politically, and it concerns me as well, I would like to explain psychologically why the lack of sharing and solidarity is such a pervasive problem and suggest what we can do about it.

In order to feel concern for those who are suffering, and to want to act in solidarity to alleviate their suffering, it is necessary to experience certain feelings such as sympathy, empathy, compassion, love and (personal) power. Moreover, it is necessary that these feelings are not suppressed or overwhelmed by fear and, equally importantly, not overwhelmed by a feeling of (unconscious) self-hatred. If someone is scared and full of unconscious self-hatred, then they can have little interest in sharing their own resources or acting in solidarity with those who need help. And this applies whether the adversely impacted individual is a close relative or friend, or someone on the other side of the world.

So why is fear in this context so important? Simply because fear grotesquely distorts perception and behaviour. Let me explain why and how.

If an individual is (consciously or unconsciously) frightened that one or more of their vital needs will not be met, they will be unable to share resources or to act in solidarity with others, whatever the circumstances. In virtually all cases where an individual experiences this fear, the needs that the individual fears will not be met are emotional ones (including the needs for listening, understanding and love). However, the fearful individual is never aware of these deep emotional needs and of the functional ways of having these needs met which, admittedly, is not easy to do given that listening, understanding and love are not readily available from others who have themselves been denied these needs.

Moreover, because the emotional needs are ‘hidden’ from the individual, the individual (particularly one who lives in a materialist culture) often projects that the need they want met is, in fact, a material need.

This projection occurs because children who are crying, angry or frightened are often scared into not expressing their feelings and offered material items – such as a toy or food – to distract them instead. The distractive items become addictive drugs. This is why most violence is overtly directed at gaining control of material, rather than emotional, resources. The material resource becomes a dysfunctional and quite inadequate replacement for satisfaction of the emotional need. And, because the material resource cannot ‘work’ to meet an emotional need, the individual is most likely to keep using direct and/or structural violence to gain control of more material resources in an unconscious and utterly futile attempt to meet unidentified emotional needs.

This is the reason why people such as the Rothschild family, Jeff Bezos, Bill Gates, Warren Buffett, Amancio Ortega, Mark Zuckerberg, Carlos Slim, the Walton family and the Koch brothers as well as the world’s other billionaires and millionaires seek material wealth, and are willing to do so by taking advantage of structures of exploitation held in place by the US military. They are certainly wealthy in the material sense; unfortunately, they are utterly terrified (and full of self-hatred) and each of them justly deserves the appellation ‘poor little rich boy’ (or girl).

If this was not the case, their conscience, their compassion, their empathy, their sympathy and, indeed, their love would compel them to use or disperse their wealth in ways that would alleviate world poverty and nurture restoration of the ancient, just and ecologically sustainable economy: local self-reliance. See ‘The Flame Tree Project to Save Life on Earth’.

Of course, it is not just the billionaires and millionaires of the corporate elite who have suffered this fate.

Those intellectuals in universities and think tanks who accept payment to ‘justify’ (or simply participate in without question) the worldwide system of violence and exploitation, those politicians, bureaucrats and ordinary businesspeople who accept payment to manage it, those judges and lawyers who accept payment to act as its legal (but immoral) guardians, those media editors and journalists who accept payment to obscure the truth, as well as the many middle and working class people who accept payment to perform other roles to defend it (such as those in the military, police, prison and education systems), are either emotionally void or just too frightened to resist violence and exploitation, in one or more of its many manifestations.

Moreover, governments that use military violence to gain control of material resources are simply governments composed of many individuals with this dysfunctionality, which is very common in industrialized countries that promote materialism. Thus, cultures that unconsciously allow and encourage this dysfunctional projection (that an emotional need is met by material acquisition) are the most violent both domestically and internationally. This also explains why industrialized (material) countries use military violence to maintain political and economic structures that allow ongoing exploitation of non-industrialized countries in Africa, Asia and Central/South America.

But, equally importantly, many ‘ordinary’ people are just too scared to share (more than a token of) what they have and to act in solidarity with those who suffer whether through military or other violence, exploitation, persecution, oppression or occupation. Of course, it takes courage to resist this violent world order. But underlying courage is a sense of responsibility towards one’s fellow beings (human and otherwise) and the future.

As noted above, however, fear is not the only problem. Two primary outcomes of fear are self-hatred and powerlessness. Here is how it happens.

When each of us is a child, if our parents, teachers and/or the other adults around us are frightened by a feeling – such as sadness, anger or fear – that we are expressing, then they will use a variety of techniques to stop us expressing this feeling. They might, for example, comfort us to stop us crying, scare us out of expressing our anger (particularly at them) and reassure us so that we do not feel afraid.

Tragically, however, responses such as these have the outcome of scaring us into unconsciously suppressing our awareness of how we feel when, of course, evolutionary pressures generated emotional responses (some pleasant, some less so) to events in our life in order to help guide us into behaving appropriately at any given moment. And this suppression of how we feel is disastrous if we want children to grow up behaving functionally. This is more fully explained in ‘Why Violence?’ and ‘Fearless Psychology and Fearful Psychology: Principles and Practice’.

So where does self-hatred fit into all of this? Well, if a child is angry in response to some violence to which they are being subjected (usually, of course, in an attempt to control their behavior), then they will attempt to defend themselves against this violence in an effort to persevere with their original intention.

However, if the child is then terrorized into submission by a parent or other adult (by being threatened with or experiencing some form of violence, often given the inaccurate label of ‘punishment’) the child will be compelled to unconsciously suppress their awareness of the original feelings, including anger, that were generating their behavior.

Unfortunately, there is a heavy cost to this suppression because each child is genetically programmed to follow their own self-will (manifesting through such mental functions as thoughts, feelings and conscience) rather than to obey the will of another (whether it be parent, teacher, religious figure or anyone else).

Hence, if a child is successfully terrorized into not behaving in accordance with their own self-will, they will experience a strong feeling of self-hatred precisely because they have submitted, out of fear, to the will of another.

Conscious self-hatred is an intensely unpleasant feeling to experience, however, and because the child is systematically terrorized out of expressing and acting on most of their feelings (which is why 100% of children go to school wherever school is available and compulsory: children are not given freedom of choice) the feeling of self-hatred is suppressed along with these many other feelings. Having learned to do this, subsequent opportunities for this self-hatred to be felt are progressively more easily suppressed.

An unconscious feeling does not ‘go away’ however; it is unconsciously projected elsewhere. Suppressed self-hatred is always unconsciously projected as hatred of someone else, some other group (usually of another sex, race, religion or class) and/or something else, often in imitation of the violent parent/adult (because imitation will be given ‘permission’ by the violent parent/adult). And this inevitably leads to destructive behaviors towards that individual, group and/or the ‘something else’ (including the Earth’s environment).

But, and this is important to recognize, this destructive behaviour might simply manifest as inaction: doing nothing in response to someone else’s (or the Earth’s) obvious need.

So the unconscious fear and self-hatred are projected as fear of and hatred for living beings as well as the Earth, and manifests as behavior that is destructive, often by inaction, of themselves, others and the planet.

The tragic reality is that it takes very little violence to terrorize a child and this is why a substantial proportion of the human population is consumed by their own fear and self-hatred, and feels powerless as a result. Consider the people immediately around you: many spend most of their time, consciously or unconsciously, abusing themselves, others and/or the environment, and doing nothing in response to the plight of our world.

So what can we do?

Given existing parenting practice, fear and self-hatred are not easily avoided although they are not necessarily all-consuming. But to be free of them completely requires just one thing: the fearlessness to love oneself truly. What does this mean?

To love yourself truly, you must always courageously act out your own self-will, whatever the consequences. This requires you to feel all of your emotional responses – fear, sadness, anger, pain, joy, love … – to events, including impediments, in your life. See ‘Feelings First’. It is only when you do this that you can behave with awareness: a synthesis of all of the feedback that your various mental functions give you and the judgments that arise, in an integrated way, from this feedback. See ‘Human Intelligence or Human Awareness?’

At first glance loving yourself and acting out your own self-will might sound selfish. But it is not. Self-love is true love. The individual who does not truly love themself cannot love another. Nor will they feel such emotional responses as compassion, empathy and sympathy. Hence, this individual will not seek mutually beneficial outcomes in tackling conflict, will not seek distributive justice in resource allocation, will not value ecological sustainability and will not act in solidarity with those who are suffering. It is this individual, who is terrified, self-hating and powerless, who will act selfishly.

In addition to courageously acting out your own self-will, you might also consider making ‘My Promise to Children’.

And if you love yourself enough to be part of the struggle to end the violence and exploitation of those who are full of fear and self-hatred, you might like to consider signing the online pledge of ‘The People’s Charter to Create a Nonviolent World’ and/or using sound nonviolent strategy for your campaign or liberation struggle. See Nonviolent Campaign Strategy or Nonviolent Defense/Liberation Strategy.

Those who are terrified and self-hating never will.

 

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?’ His email address is flametree@riseup.net and his website is here.

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

Freedom Rider: Oligarch Jeff Bezos

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By Margaret Kimberley

Source: Intrepid Report

Amazon CEO Jeff Bezos has a net worth of $105 billion and is the richest man in the world. But he is not just the richest man at this moment in history. He is the richest person who has ever lived. As of 2017 he and seven other billionaires had a collective net worth equal to that of the poorest 3.6 billion people on earth.

These figures have been in the news of late but without much useful analysis. The corporate media refuse to state what is obvious. Namely that inequality is worse around the world precisely because these super rich people demand it.

While pundits and politicians go on breathlessly about oligarchs in Russia, they seldom take a look at the wealthiest in their own backyard and the control they exert over the lives of millions of people. When Amazon announced it would choose a site for its new headquarters, cities across the country began a furious race to the bottom. Amazon is not alone in the thievery department. Major corporations like Walmart always request and receive public property and public funds in order to do business.

Some 235 cities have put themselves in the running for this dubious venture. Chicago is willing to give Amazon $1.3 billion in payroll taxes that prospective employees would ordinarily pay that city. If Chicago wins this booby prize, Amazon employees would pay taxes to their employer and not to the government. This is truly cutting out the middle man and makes real the rule of, by, and for the wealthiest.

The potential for public outrage isn’t lost on unprincipled politicians. Some cities now refuse to reveal how much they plan to give away. But the news to date is disheartening with Boston offering $75 million while Houston is willing to part with $268 million. Amazon says it will hire 50,000 people but their business model already pays employees so little that many of them qualify for public assistance, despite being employed.

The United States is as much of an oligarchy as countries it usually disparages but it is far more dishonest about its true nature. All talk of democracy is a lie as the rich get richer, by an additional $1 trillion in 2017, and wield more and more power over the lives of everyone else.

The Bezos juggernaut is not restricted to theft of public money. He is also the sole owner of the Washington Post, one of the most influential newspapers in the country. Bezos owns a newspaper that is an organ of the ruling elite and he also has a $600 million contract to provide the Central Intelligence Agency with cloud computing services.

The Washington Post was the force behind Propaganda or Not, an effort to destroy left wing voices like those at Black Agenda Report. Under the guise of fighting Russia and so-called fake news, the Bezos owned Post began the censorship campaign that has put the left’s presence on the Internet in such jeopardy.

Politicians outdo one another giving away public resources to the richest man on the planet who also owns a major newspaper and services the surveillance state. If it can be said that any one person rules the world, Bezos would be obvious choice. No one in Chicago, Boston, Houston or any of the other cities giving away the store ever voted for Jeff Bezos. All talk of democracy is a sham as long as the richest people take from the rest of humanity.

The effort to make government an irrelevance is thoroughly bipartisan. Republicans and Democrats alike are willing to turn over government coffers to Bezos and his ilk and the rights of the people be damned.

Whoever wins this tarnished brass ring ought to be consigned to political defeat. The mayor, aldermen, city council members or whoever else brings disaster to their locality should be punished for aiding and abetting the theft. If these cities can give to the richest man who ever lived, they can surely use public money to help their residents right now. But they will never do that because they are all bought off and compromised. They are either cynical or afraid to go against the real rulers of the country.

Bezos may look like the villain in a James Bond movie but there is nothing funny about him. He is deadly serious and so are his intentions. In a Bezos run world, every worker will be impoverished, every level of government will subsidize corporations, and anyone who speaks out will be discredited and under surveillance.

The last thing any city needs is a new Amazon headquarters. We need an end to billionaire rule in this country and around the world. That will be the salvation of the people, not more sweatshops run by wealthy people who steal from everyone else.

 

Margaret Kimberley’s Freedom Rider column appears weekly in BAR, and is widely reprinted elsewhere. She maintains a frequently updated blog as well as at freedomrider.blogspot.com. Ms. Kimberley lives in New York City, and can be reached via e-Mail at Margaret.Kimberley(at)BlackAgendaReport.com.

Gaius Publius: Defining Neoliberalism

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By Yves Smith

Source: Naked Capitalism

For years I’ve been using the term “neoliberalism” (or sometimes neo-liberalism*) and I’m always uncomfortable, since it sounds so academic. So I usually add one-phrase definitions and move on. For example, this from a recent piece on Puerto Rico:

If neoliberalism is the belief that the proper role of government is to enrich the rich — in Democratic circles they call it “wealth creation” to hide the recipients; Republicans are much more blatant — then the “shock doctrine” is its action plan.

That’s sounds pretty blunt, but it’s a true statement, even among academics. See this great interview (start at about 6:15) with Professor Philip Miroski of the University of Notre Dame on how modern neoliberals have come to see the role of government in society. It’s weedy but excellent.

I want to offer our readers a better description of neoliberalism though, yet not get into too many weeds. So consider these excerpts from a longer Guardian essay by the British writer George Monbiot. (My thanks to Naked Capitalism commenter nonclassical for the link and the idea for this piece.)

Neoliberalism — The Invisible Water the West Is Swimming In

We’ll start with Monbiot’s brief intro, just to set the scope of the problem:

Imagine if the people of the Soviet Union had never heard of communism. The ideology that dominates our lives has, for most of us, no name. Mention it in conversation and you’ll be rewarded with a shrug. Even if your listeners have heard the term before, they will struggle to define it. Neoliberalism: do you know what it is?

Ask people to define “neoliberalism,” even if they’ve heard of it, and almost no one can. Yet the comparison of our governing ideology to that of the Soviet Union’s is a good one — like “communism,” or the Soviet Union’s version of it, neoliberalism defines and controls almost everything our government does, no matter which party is in office.

The Birth of Neoliberalism

What is neoliberalism and where did it come from? Monbiot writes:

The term neoliberalism was coined at a meeting in Paris in 1938. Among the delegates were two men who came to define the ideology, Ludwig von Mises and Friedrich Hayek. Both exiles from Austria, they saw social democracy, exemplified by Franklin Roosevelt’s New Deal and the gradual development of Britain’s welfare state, as manifestations of a collectivism that occupied the same spectrum as nazism and communism.

Neoliberalism is an explicit reaction to Franklin Roosevelt and the welfare state, which by a quirk of history was called “liberalism” at the time, even though, in the nineteenth century, “liberalism” had roughly the same meaning that “neoliberalism” has today. In other words, “FDR liberalism” is in many ways the opposite of classical “liberalism,” which meant “liberty (freedom) from government,” and a quirk of history has confused these terms.

Back to Monbiot and Hayek:

In The Road to Serfdom, published in 1944, Hayek argued that government planning, by crushing individualism, would lead inexorably to totalitarian control. Like Mises’s book Bureaucracy, The Road to Serfdom was widely read. It came to the attention of some very wealthy people, who saw in the philosophy an opportunity to free themselves from regulation and tax. When, in 1947, Hayek founded the first organisation that would spread the doctrine of neoliberalism – the Mont Pelerin Society – it was supported financially by millionaires and their foundations.

With their help, he began to create what Daniel Stedman Jones describes in Masters of the Universe as “a kind of neoliberal international” [a term modeled on “the Communist International]: a transatlantic network of academics, businessmen, journalists and activists. The movement’s rich backers funded a series of thinktanks which would refine and promote the ideology. Among them were the American Enterprise Institute, the Heritage Foundation, the Cato Institute, the Institute of Economic Affairs, the Centre for Policy Studies and the Adam Smith Institute. They also financed academic positions and departments, particularly at the universities of Chicago and Virginia.

As it evolved, neoliberalism became more strident. Hayek’s view that governments should regulate competition to prevent monopolies from forming gave way – among American apostles such as Milton Friedman – to the belief that monopoly power could be seen as a reward for efficiency.

Note the mention of Milton Friedman above. Neoliberalism is a bipartisan ideology, not just a Clintonist-Obamist one.

Democrats, Republicans and Neoliberalism

As Monbiot explains, for a while neoliberalism “lost its name” and was more or less a fringe ideology in a world still dominated by the ideas of John Maynard Keynes and Keynesian economics. When neoliberalism later came back strong in the Republican Party, it wasn’t called “neoliberalism” but “Milton Friedman free market conservativism,” or something similar.

Only when Bill Clinton and his Democratic Party allies adopted it in the 1980s did the term “neoliberal” re-emerge in public discourse.

[I]n the 1970s, when Keynesian policies began to fall apart and economic crises struck on both sides of the Atlantic, neoliberal ideas began to enter the mainstream. As Friedman remarked, “when the time came that you had to change … there was an alternative ready there to be picked up”. With the help of sympathetic journalists and political advisers, elements of neoliberalism, especially its prescriptions for monetary policy, were adopted by Jimmy Carter’s administration in the US and Jim Callaghan’s government in Britain.

After Margaret Thatcher and Ronald Reagan took power, the rest of the package soon followed: massive tax cuts for the rich, the crushing of trade unions, deregulation, privatisation, outsourcing and competition in public services. Through the IMF, the World Bank, the Maastricht treaty and the World Trade Organisation, neoliberal policies were imposed – often without democratic consent – on much of the world. Most remarkable was its adoption among parties that once belonged to the left: Labour and the Democrats, for example. [emphasis added]

Note the role of Jimmy Carter and start of deregulation in the late 1970s. For that reason, many consider Jimmy Carter to be the “proto-neoliberal,” both for the nation and the Democratic Party.

Neoliberalism — “Just Deserts” for Predators and Prey

What makes “neoliberalism” or “free market conservatism” such a radical — and destructive — ideology? It reduces all human activity to economic competition. It creates and glorifies, in other words, a world of predators and prey, a world like the one we live in as today:

Neoliberalism sees competition as the defining characteristic of human relations. It redefines citizens as consumers, whose democratic choices are best exercised by buying and selling, a process that rewards merit and punishes inefficiency. It maintains that “the market” delivers benefits that could never be achieved by planning.

In a world where competition is right and good, a world in which the “market” is the defining metaphor for human activity, all social ties are broken, the individual is an atom left to survive as an individual only, the strongest relentlessly consume the weakest — and that’s as it should be. (It’s easy to imagine how the apex predators of our social order would be attracted to this, and insist on it with force.

Thus the bipartisan world we live in today. Under a neoliberal regime, everyone gets what they deserve. Big fish deserve their meal. Little fish deserve their death. And government sets the table for the feast.

The Role of Government in a Neoliberal World

Since for neoliberals, the “market” is the source of all that is good in human interaction, non-interference in “the market” is rule one for government.

Over time that has changed, however, as winners have grown more successful and their control of government more absolute. The proper role of government in today’s neoliberal regime is not merely to allow the market to operate for the benefit of wealth-holders; it’s to make sure the market operates for the benefit of wealth-holders.

In other words, the role of government is to intervene in the market on behalf of wealth-holders, or, as I put it more colloquially, to proactively enrich the rich. The interview with Professor Mirowski, as I noted above, makes that same point, but from an academic standpoint.

From this it should be also clear that until we free ourselves of rule by neoliberals and the pain and misery they create, we’ll always be victims to the predatory giants — the very very wealthy and the corporations they use as power-extenders — those, in other words, who want merely to own everything else in the world.

This means we need to free ourselves from neoliberals in both parties, not just the ones in current seats of power. But that idea seems to have been excised from most discussions these days. Fair warning though. If the Age of Trump ends with the Restoration of Mainstream Democrats, we’ll have won almost nothing at all.

____________

* I sometimes spell “neo-liberalism” with the hyphen to suggest the following connection: Neo-liberalism is “new liberalism,” and has the same relationship to FDR liberalism as New Labour has to Labour — the two are exactly opposite.