Are we there yet?

Welcome to what we all hope will be a happy new year. To answer the question of whether we’re there yet, we should try to figure out where we’re headed.

Is it “1984,” George Orwell’s 1949 book that highlighted a world of perpetual war, omnipresent government surveillance and public manipulation, dictated by a political system that persecuted individualism and independent thinking as “thought crime”?—a society ruled by an overarching Party that seeks power entirely for its own sake and is not interested in the good of others. Does this sound familiar to some of us?

Or, is it “Brave New World,” Aldous Huxley’s 1932 book, describing a different type of dystopia where people are manipulated by the State into thinking of nothing but their own pleasure. It could also be “Animal Farm,” Orwell’s previous 1945 work where the Pigs take over society and the government.

Think about that one. In this new American world of fake news and Russian hacking, we may be closer to the world described in any of these than we think.

I don’t know about you, but I spent much of high school and college trying to fake my way through having to read these books as part of English literature, because they were very difficult. “Cliff Notes” were a big help. Nowadays, they ought to be required reading if we want to understand the kinds of futures to which we and our fellow travelers on this planet may be headed.

Orwell’s idea of historical revisionism seems more relevant than ever. After decades of conflict and competition with the Soviet Union, and now, Russia, we have a president-elect who totally reverses course, not only in his admiration for ex-KGB villain Vladimir Putin, but also in his nomination of Cabinet-level officers like Exxon CEO Rex Tillerson for secretary of state, who has spent 40 years making big oil money with the Russians. Russian hacking? No problem, says Big Brother.

Rewriting history is all around us. Republicans now claim they were responsible for passage of the 1964 Civil Rights Act. Not true—the fault lines at the time were northern legislators versus the southern ones, not by party. Because of this bill, the regional fault lines shifted and the southern Democrats of old are now the “new” Republicans of the south. Moderate Republicans of yore would have no place in the current Republican party.

Republicans justify blocking virtually everything President Obama proposed, by saying they were just copying Democrats during the Bush administration. This is true neither in word nor deed. President Obama’s appointments to office faced months of waiting before the Senate would consider doing its duty. Even now, he is leaving office with more than 100 judicial vacancies for which Republican senators have refused hearings, including a well-qualified nominee for the Supreme Court.

Under Bush, Democrats joined the vote to invade Iraq, cooperated with trillions in borrowing to pay for the war, consented to Bush’s nominees and otherwise kept the government running. Democratic legislators never once tried to shut down the government.

The distinction between fact and fiction is dissolved in the “societies” of “1984,” “Brave New World,” and “Animal Farm.” Today, the media is belittled and besmirched. Fake news on Facebook, other social media and on hate-filled blogs may be the equivalent of Orwell’s character Winston Smith’s rewriting of previous news articles to comply with the Party line, but berating the media, blacklisting reporters, or limiting media access will accomplish the same in our future.

One of Orwell’s main themes was that “Big Brother Is Watching You.” We should be concerned that Trump’s Department of Energy transition team wants a list of all civil service personnel “to identify which employees and contractors have worked on forging an international climate pact as well as domestic efforts to cut the nation’s carbon output” during the past five years.

Former Virginia Attorney General Ken Cuccinelli spent considerable taxpayer money hounding a professor who worked on climate-related research. Trump’s transition team asked the State Department for details on programs aimed at benefiting women around the world, including identifying staff members who worked to reduce gender-based violence and promote women in the workplace. Several Obama administration officials called that query chilling and the request was withdrawn after it was widely criticized. This will not be a world in which whistleblowers can speak truth to power.

We may not be there yet, but the critical thinkers and writers of the last generation have given us tools with which to protect ourselves by helping us recognize the dystopias they described—their insights should give us pause. We have an opportunity, and an obligation, to test ourselves against our own standards of government, civility and generosity.

Be vigilant, stay informed, do your fact-checking, and vote in your own self -interest, for only you can prevent these stories of a dark future from coming true. Dare we have hope for 2017? “All that is necessary for evil to triumph is for good men [and women] to do nothing.”

Mike McClary

Note: Reprinted with author’s permission and originally appearing here.

What me Worry?

In an earlier post, Mike McClary asks this question about the incoming Drumpf administration, “What could go wrong?”

Considering the number of similarities between this administration and the second Bush administration, there are a lot of things that could go wrong. Starting with a group of ideologues totally convinced of their superiority, who are willing to say and do anything to maintain that sense of entitlement, and so arrogantly confident in their own infallibility that they make a “What me Worry” attitude look like a cautionary tale.

And here’s where the Alfred E. Newman joke stops being funny, because things will go wrong not because of unforeseen events or circumstances, but because of this administrations unwavering commitment to Neoliberal ideology. A commitment which from all indications, exceeds even the Bush administration, who stood by and did nothing as a number of crises happened under their watch: the rapid expansion of dirty oil and hydrofracking, the slow collapse of public health and education, the financial meltdown of 2007‑8, and the offshoring of wealth.

As philosophical systems go, Neoliberalism guiding principle is one which John Kenneth Galbraith aptly characterized as“… man’s oldest exercise in moral philosophy; the search for a moral justification for selfishness.”

Specifically by shifting the centers of power, and reshaping society to accommodate it. Its power derived from its anonymity and pervasiveness; where on one hand it has become widely accepted “natural,” like Darwin’s theory of evolution.  Yet its consequences happen in such isolation that like evolution it hardly appears to be happening.

Borrowing heavily from evolution, it sees competition as the defining characteristic of humanity. Redefining citizens as consumers, whose choices are best exercised by buying and selling, a process which rewards merit and punishes inefficiency, maintaining that “the market” delivers benefits which could never be achieved by planning. And where any attempts to limit competition are inimical to liberty. Taxes and regulation are minimized, public services are privatized. The organization of labor and collective bargaining by trade unions are market distortions which impede the formation of a natural hierarchy of winners and losers. I

Inequality is recast as virtuous: a reward for utility and a generator of wealth, which trickles down to enrich everyone. Efforts to create a more equal society are both counterproductive and morally corrosive. The market ensures that everyone gets what they deserve. This brings us to the Drumpf administrations plans to double down on neoliberal economic policies in ways that the country and world has never seen before.

Typically markets react to economic fundamentals rather than politics. But these are not ordinary times, and make no mistake our economy (and the worlds) will be deeply entangled with the incoming administrations ideology.

In classical market capitalism the banking system is supposed to funnel our collective savings into productive investment. But today, only 15% of that money makes its way into business investment. The rest gets moved around a closed financial loop, buying and selling of existing assets, such as real estate, stocks, and bonds.  The financial sector — including banks, hedge funds, mutual funds, insurance and trading houses — represents roughly 7% of the economy. Yet creates only 4% of all US jobs, and takes 25% of all private sector profits.

While a healthy financial system is crucial for growth, when it gets big enough, it sucks the economic air out of the room– and studies have shown that slower growth begins to happen when the financial sector is half its current size. The growth of the financier class has dramatically increased inequality, with the top quarter of the population owning the vast majority of those assets, and it is a major reason why a large percentage of the United States and world’s population feels the economic system is rigged and disproportionately benefits the elite

Nor is it any coincidence that overall economic growth has been markedly slower during the neoliberal era (1980 on) than the preceding decades; but not for the very rich. Inequality in the distribution of both income and wealth rose rapidly due to the smashing of trade unions, tax reductions, rising rents, privatization and deregulation.

The privatization or marketisation of public services such as energy, water, health, education, roads and prisons enabled corporations to set up tollbooths in front of essential assets and charge rent, to citizens and government alike. Rent is another term for unearned income.  Financialisation, as Andrew Sayer notes in Why We Can’t Afford the Rich, has had a similar impact. “Like rent, interest is … unearned income that accrues without any effort.

Jon Taylor

Next: working against gravity

 

 

Working against gravity

Meanwhile, the poor become even poorer and the rich become even richer, with the rich increasingly acquiring control over a crucial asset: money. Interest payments, overwhelmingly, are a transfer of money from the poor to the rich. As property prices and the withdrawal of state funding load people with debt the banks and their executives clean up. The past four decades have been characterized by a transfer of wealth not only from the poor to the rich, but within the ranks of the wealthy: from those who make their money by producing new goods or services to those who make their money by controlling existing assets and harvesting rent, interest or capital gains.

And since the 80’s, Neoliberal policies have been failures everywhere they have been tried. Unfortunately, the greater the failure, the more extreme the ideology becomes. Governments use neoliberal crises as both excuse and opportunity to cut taxes, to privatize remaining public services, rip holes in the social safety net, deregulate corporations and re-regulate citizens, sinking their teeth into every organ of the public sector.

And when it comes to the Drumpf administration, they have made it clear that they intend to use the government to extract every last drop of unearned income— I mean profit from every possible source.  Starting with a massive assault on “public goods”— public education, public lands, public information and public health. Historically liberals have seen the production and protection of public goods as a rightful — though not exclusive — function of government, and conservatives deplore interference in the free, private market. A tension that existed in some equilibrium from World War II to the 1980s, but now it is almost completely non-existent.

And this entitled neoliberal ideology is about to run smack into reality, especially since the recovery from the Great Recession has been the longest, slowest one of the post World War II era. Seven and a half years is a long time by economic standards, nearly as long as the vaunted Clinton economic boom of the 90’s.

So it’s quite likely that there will be major downturn during the Drumpf’s reign. And because Drumpf and his “advisors” rely on bluster rather than policy and seem to have little understanding of or commitment to learning how anything works, there is a good chance that any downturns will be bad, global, and probably worse than 2007-2008.

One of the most irrelevant mantras of conservative lore is the “success” of the stock market in the aftermath of the Great Recession. What they choose to overlook is that the reason for the stock market surge is that interest rates have been almost zero since 2009. Investors put money in the stock market because it is the only place they can make money. Companies were able to borrow low interest rates, using it buy up their own stock, figuring they can always use profits to pay back loans.

Such “irrational exuberance” is essentially a Ponzi scheme, and while it has contributed to rise of the U.S. dollar overseas, eventually someone is going to be left holding the bag. Because an even bigger problem caused by the rise in the value of the dollar is that foreign companies and countries will be unable to repay debts. That could be the pin that finally pricks the bubble. As the value of their money declines, they face a huge spike in servicing costs and an elevated debt that they can never pay back.

While all of this is happening four long-term mega-trends will further affect the world’s economic viability.

Climate change will be economically devastating. Health care costs go up as people, especially the old and young, face weather extremes. Infrastructure, especially in coastal cities will be destroyed by storm surges and rising sea levels. Drought and flooding will undermine agricultural production.

Automation and robotics, with the World Economic Forum predicting a “Fourth Industrial Revolution” characterized by unprecedented “developments in genetics, artificial intelligence, robotics, nanotechnology, 3D printing, and biotechnology,” where millions of skilled and unskilled workers will be replaced by machines.

Industrial overcapacity similar to late 1920s just before the Great Depression, where factories are producing more cars, steel, flat-screen televisions, and other consumer products than can be profitably sold or even used. Stanford history professor Walter Scheidel argues that the only thing that has reversed this trend in the past have been devastating wars which destroyed factories and inventory. And given the collection of hard line radicals advising the Drumpf on National Security matters, the chances of a military solution to their shitty economic policies is a distinct possibility.

And finally economic inequality which as it has “evolved” in the United States since the 80’s, has seen the share of total income going to the top 1 percent of earners in the United States double. While wages have barely changed, causing the working and middle class share of that pie to shrink to the point where the United States is starting to look like some of the world’s poorest countries.

Jon Taylor

Next: disenfranchising everybody

Disenfranchising everybody

The greatest danger of neoliberal ideology is not the economic crises it causes, but the political void which follows in their wake. As the state is reduced, our ability to change the course of our lives through voting also contracts. Neoliberal theory asserts that people exercise choice through spending. But clearly some have more to spend than others and those “votes” will count even more, disempowering the poor and middle class in the process.

And as the radical right and what remains of the left adopt similar neoliberal policies; economic disempowerment turns to disenfranchisement, with large numbers of people left with no political voice. And it is one of the reasons why the Republicans have expended so much energy since the Civil Rights act was gutted in 2013 to disenfranchise voters even further.  Deep in their black hearts they know that sooner or later, the people could turn against them, and are doing everything possible to ensure that doesn’t happen.

Neoliberalism is a failed ideology, like communism. But like a zombie it continues to stagger around, kept alive by a cluster of well financed and anonymous endeavors; disenfranchising voters, rewriting the laws, capturing the public narrative with presidential tweets, fake controversies, and Trump TV. All backed by a fascist police state in search of aliens and enemies of the Drumpf in order to keep the gravy train rolling.

That’s not even the scary part; it’s the extreme agenda of the climate change deniers in his administration. Starting with Scott Pruitt, who will head the EPA, and seeks to reverse Obama’s rules on reducing carbon emissions, and turn over federal public lands to the states, aided by the new Secretary of the Interior, former Representative Ryan Zinke, who wants to sell off public lands held by the federal government.

While it’s difficult to imagine a more significant notion of public goods than clean air, clean water, and the avoidance of catastrophic climate change as well as preserving the legacy of the nation’s parks, forests and wildlife. What they intend to do represents a significant blow to the notion of a “commonwealth” — where natural resources that are shared by all.

Considering that this administration grandiose plans to “privatize” infrastructure development will presumably mirror their approach to rebuilding damaged infrastructure caused by global warming – even more disaster capitalism. One can only ask how they intend to deal with the health consequences caused by global warming, as  the new head of Health and Human Services, former representative Tom Price, could give “Heck of a job, Brownie” of Hurricane Katrina fame a run for his money.

Throw in Rick Perry as head of the Department of Energy, Rex Tillerson, current CEO of Exxon-Mobil, and “special friend of Russia” as Secretary of State, and Wilbur Ross as Commerce Secretary who collectively will double down on drilling, hydrofracking, and pipelines for toxic crude, along with a massive increase in the exportation of natural gas and coal around the world and you have all the makings for recipe for irreversible environmental disasters on a global scale.

Which brings us to Naomi Klein and her latest book, “This Changes Everything” where she illustrates the many ways neoliberal economics is waging war against life on earth via the effects of climate change. Making it clear that global warming isn’t just another political issue to be brought out from time to time and then neatly filed away; it’s an alarm to fix an economic system which is failing us.

And as I’ve said before the greater the failure, the more extreme the ideology becomes, and sure enough, the Drumpf administration plans to bring in a cadre of people who were at the heart of the fiscal meltdown. And collectively they are even worse than the economic advisors president Obama filled his first term with. A rouges gallery that starts with Steven Mnunchin, the ubiquitous Forrest Gump of the financial crisis whose involvement in the speculative bubbles of the 90’s and 00’s beggars the imagination as Treasury Secretary.

Accompanied by former representative Rick Mulvaney of House Freedom Caucus fame, as the OMB’s budget director, and Linda McMahon of WWF fame as the head of the Small Business Administration, Andy Puzder, the anti labor and minimum wage CEO of Hardees’s and Carl’s Jr. as Labor Secretary, and Gary Cohn, former CFO of Goldmine Sachs as the Director of the National Economic Council.

In fact, it would be difficult to locate a finer cast of foxes willing to guard the economic hen house.  Meanwhile as they continue to make their plans, the planet will continue to burn up.

Jon Taylor