The Shock Watch, Part 3

We’ve seen that unregulated capitalism enriches the already rich and leads inevitably towards feudalism, with the wealth concentrated at the top of the economic ladder, followed by economic collapse. The corporatists in this country have been following a strategy to achieve this for the last 30 years, using flag-waving, gay-bashing, and abortion as cover, all the while delaying the inevitable collapse by pumping money into a series of economic bubbles to create the illusion of prosperity while moving as much money out of the lower classes’ pockets as they can before the fall.

In fact, the powerful forces of corporations and the rich in this country have turned our federal government into an agency which, instead of moving money back down the ladder, actually moves money into the hands of the already wealthy, at ever greater speeds, in ever greater amounts. This policy means economic disaster for the country, and for many years the traditional Republicans in the party were frightened to go down that path. Witness: Reagan’s “biggest tax cut” in the early 1980s, which was the corporatist’s first big venture into being economically irresponsible in modern times. They were, instead of continuing to fund the redistribution of money, going to keep their money and let it “trickle down” against the natural flow of money upwards. The predictable economic downtown followed immediately, and the Reagan administration, spooked, ordered the largest tax increase up until that time to right matters. But the GOP has learned to embrace irresponsibility, cutting more and more taxes, generating huge federal debt, strangling the federal government’s ability to move money to the lower classes.

We are now on the brink of a terrible economic crash, with essentially only two options: one path includes government taking back on the mantle of redistribution, taking money from the wealthy and putting it back into the lower classes. The other, which at first seems unthinkable, is to go in exactly the opposite direction. Let’s take a closer look at those two options.

In the Stock Market Crash of 1929 and the start of the Great Depression, Hoover’s response was essentially to do nothing. The idea of the government employing people, of giving money to people in need, was anathema to the business class, of which he was part. The country’s response was to elect Franklin Roosevelt, who halted and then reversed the effects of the depression by getting money into the hands of people who needed it – widows and orphans, the maimed, the blind, the elderly. He created Social Security. He employed thousands of the unemployed to repair and build the country’s infrastructure, bringing electricity to rural areas, roads, bridges, trails, buildings. He made the humane move, using government to get people through hard economic times and in essence saving capitalism from its own inevitable end, in feudalism and most likely, revolution.

FDR’s solution was to create MORE social spending, more safety net, more help for people.

Amazingly, though, in many countries around the world, the exact opposite approach has been used; when other economies have gotten in trouble, the response has been to REMOVE the social safety net, to get rid of the minimum wage, to destroy organized labor, to sell off public resources to private interests, to lift regulations and to move towards much more unfettered and brutal pure capitalism.

In those countries, their right-wing regimes have had to use violence and even torture to keep their populaces in line, for of course instead of relieving their pain, they have increased it. These measures have taken various names, including “economic shock therapy” and “strong medicine”. And they have worked out just peachily for the already rich, the multinational corporations, and the politicians willing to front for those interests. Those histories are summarized in Naomi Klein’s book The Shock Doctrine.

So, this country faces a certain binary choice: in the face of economic collapse, and that is surely what we are facing, will we INCREASE social spending, regulation, and the safety net, or will we DECREASE it?

INCREASING the government’s response to the crisis is surely the path of sanity. That way would keep this country from becoming a third-world shithole, and it seems to be Obama’s stated objective. Most of America would probably back this path (if our citizenry were educated better and not propagandized), and most experts with a slice of sanity or humanity back it.

DECREASING the government’s response is now being proposed, though, by the GOP. They are on the floor of Congress, spinning tales about how the New Deal didn’t work. They are trying to make the federal government, which has already been turned into an instrument for funneling more and more money to the already rich (witness: Bush’s tax cuts, the incredible boondoggle in Iraq with its “missing” trillions, the blatant and outright theft by the rich that is TARP - - is anyone objecting to those?), even more so with MORE tax cuts. They are already saying that gee, since everything is so bad, we are going to have to cut Social Security and Medicare because people need to “sacrifice”.

Other bad signs for this country going down the sane path are:

1) There has been a constant propagandizing against New Deal type spending ever since the New Deal, to the point where many Americans have a dog-whistle negative response to anything called “socialism”.

2) There is no sign that the anti-corporatist sentiment in this country has any real power at all. Sure, we can elect a nominally populist President to preside over a bankrupt nation about to go up in flames, but there is zero sign that that President or any of the members of Congress, can stop the looting of the treasury or strengthen our safety net. They are incapable of even prosecuting corporatist war crimes.

3) It is clear that the entire GOP and about half of the Democratic party are on board the corporatist money train, and those that aren’t have been spied on by our NSA for at least the last eight years and are either vulnerable to or already under extortion and control.

4) The corporatists have been quietly preparing for the inevitable popular uprising which will follow the crash and the “shock therapy”. They have gutted Posse Comitatus, created new crowd control weapons including microwave and robotic weapons, tested American’s knowledge of and commitment to their civil liberties and found them almost non-existent (Jose Padilla, a US citizen, was held without charges and tortured into insanity with nary a peep from the citizenry), and set up a surveillance system that captures virtually all communication. When the uprising comes, they will be ready.

5) Our national media is completely on board with the corporatist program. For example, every time things start to get tough in this country, our media elite start asking whether we shouldn’t start gutting Social Security. Duh! That is exactly the opposite of the right thing to do.

6) Even though some Democrats in Congress talk a pretty good game, the party leadership is completely feckless, weak, and frightened. They “allow” themselves to be outmaneuvered constantly by the GOP, even when Republicans are in extreme minority. True populist victories are few and far between.

7) The most ominous sign of our country’s coming economic demise is the appointment of Larry Summers as the head of the National Economic Council under Obama. Summers and Robert Rubin worked towards deregulation of the financial industry under Clinton, and Summers as the head of the World Bank, shepherded the economic shock therapy in Russia as the Soviet Union fell apart. That really worked out well for the people of Russia:

It was also the year that Summers, and his Harvard protégé Andrei Schleifer (who worked with Summers on the Lithuania economic transformation), began their catastrophic "rescue" of Russia's crisis-ridden economy. It's a complicated story involving corruption, cronyism and economic devastation. But by the end of the 1990s, Russia's GDP had collapsed by more than 60 percent, its population was suffering the worst death-to-birth ratio of any industrialized nation in the twentieth century, and the financial markets that Summers and Schleifer helped create had collapsed in what was then the world's biggest debt default ever. The result was the rise of Vladmir Putin and a national aversion to free markets and anything associated with Western liberalism.

Summers, and Geithner, who are cut from the same Chicago-school, Milton Friedman-ite cloth, will surely engineer the dissolution of our social safety net in the next few years.

8) Our only hope for some kind of economic upturn in the immediate future is that Obama and the one or two Democrats who understand what is going on can wrest some dollars out of the hands of the rich and give them to the poor. And I don’t see that happening. The redistributionist argument is not even being made, let alone defended, and the ever increasing wealth and power of the wealthy and powerful make their money that much harder to get at. The idea that the mighty CEOs would except even the smallest tax increase, even to help out their fellow Americans, seems almost laughable.