Predatory Value Extraction

Posted on August 6, 2021 by camelotkidd

I’ve finally found the perfect description for our late-capitalist, neoliberal milieu–predatory value extraction.

At Naked Capitalism, Hubert Horan examines the business model of Uber and finds that it represents the larger US political economy, where everything has been subjugated by Wall Street. He also discusses how Didi, the Chinese equivalent, has been treated in a far different manner by the Chinese government. Because this article is quite pertinent to my ongoing series on neoliberalism and the financialization of the US economy I’m going to quote big steaming chunks.

Horan says that, “US macroeconomic policy prioritizes the ongoing appreciation of equity values and a number of other similar asset classes. This has crippled the ability of capital markets to evaluate and price risk and has broken the link between corporate values and the creation of economic welfare benefits. No one cares what causes stock prices to go up as long as stocks go up, and the higher up they go the better.

Since it is far easier to boost stock prices by eliminating competition and exploiting workers and consumers than by developing new technologies or management processes that improve efficiency and quality, innovation declines while predatory value extraction increases. The financial world becomes dominated by artificially manufactured narratives, a far easier way to pump stock prices than complicated analysis of economic fundamentals.

This focus on equity appreciation is also largely divorced from any industrial policy considerations. As long as the stock market keeps rising it does not matter if massive investment has been funneled into the production of cat videos or if an excessive focus on short-term stock prices have crippled the semiconductor and aircraft manufacturing industries.

Years of non-enforcement of routine laws and regulations under laissez-faire, and the ability of a handful of tech companies to achieve unprecedented sizes produced an outcome where both political parties strongly support the interests of the tech industry. This effectively blocks policies (e.g. tax rules, labor laws) that could materially hurt the tech industry. It also means that it is virtually impossible to address externalities created by these policies. These include things like the rapid growth of inequality, the destruction of traditional channels of political discourse and the rights of individuals to privacy and to control their personal data. It also includes the awful, widespread fallout that would result if (when?) the Everything Bubble created by these policies bursts.”

Horan says that China, under the Communist Party, is determined to take a far different course. “Beijing may have come to believe that a system where the Jeff Bezos’ Mark Zuckerbergs and Travis Kalanicks of the world were given unfettered freedom to flaunt any rules they didn’t like may not have been producing efficient outcomes for the rest of society. It is one thing to allow investors who have developed major product and efficiencies to become rich, but a quite different thing if those investors suddenly capture previously unimaginable levels of wealth without actually improving overall economic welfare.”

What’s funny, in a perverse way, is that we’re only having this discussion about predatory value extraction, indirectly, because the Chinese government hasn’t been captured by the financial and tech industries like ours has. Of course, the corporate media is blaming the evil Chinese Communist Party for reining in the predatory value extraction in their tech and financial sectors. The horror. They should be more like us. Freedom and democracy.

Instead, Horan relates, “the tech industry plays a much different role in the economy in China than in America. When US tech companies were boosting their wealth and power into the stratosphere they were following a path that finance and other industry had already laid out. In China the Communist Party retained strong control over banks and most other major industries. The tech industry represents the breakthrough case where private capital accumulators could achieve enough power to circumvent or thwart central government policies they didn’t like, and industry leaders clearly wanted to entrench a US-type approach. This was the point where Beijing had to decide whether to reestablish some type of meaningful control, or allow the tech industry to pursue increasing US-style laissez faire freedom.

As the manager of the Chinese economy, the CCP appears concerned that giving greater control of the tech industry to more independent, less accountable people could undermine its ability to manage other parts of the economy. Much of the power and growth of the “tech” industry stems from the Alibaba and Tencent financial payments companies. Beijing may be fearful that increased power and independence could limit Beijing’s ability to control its currency and trade policies, or to fix problems with its fragile shadow banking system or to funnel capital to industries (such as semiconductors or Belt and Road investments) deemed to be major development priorities.”

You want to know the funny thing? China is doing, vis a vis its tech sector, what America used to do, under Teddy Roosevelt. Back then it was the Rockefellers and Carnegies and Vanderbilts, the muckraking press described as Robber-barons, who were reined in, (somewhat), by anti-trust legislation. That that was then and this now is approximately how far we’ve come on the road to oligarchy. Imagine if we could reign in the Zuckerbergs and the Bezos and the Kalanicks who are looting our country, while we watch helplessly? People like that would help let their own country degrade into a medieval slum so long as they were fabulously wealthy and powerful. Imagine if we could have sent them to a re-education camp like the Chinese Communist Party did to their enemies during the Cultural Revolution?

Instead, the US has embarked on a new Cold War with China because they are not following the “rule based international order”. I know, at this point I wonder how they keep a straight face. That’s the cover story, anyway, but Horan’s account only confirms that the real reason is that–the US attacks or overthrows foreign governments because they won’t allow our predatory banks subvert their economy.

Horan also strongly implies that US policies toward the tech industry involve elite impunity. (I know, huge surprise). “When Travis Kalanick blew off every inconvenient law and regulation, he was completely in line with the laissez faire policies that that national elites wanted. Uber’s investors were not only single-mindedly focused on personal enrichment but were focused on achieving corporate valuations wildly beyond what anyone could have ever imagined for a taxi company. Instead of stopping and asking for evidence as to how this might be possible, those elites became fanatical supporters. The sole objective of business was to create massive equity values. No one cared whether some of those personal gains might come from suppressing driver wages or openly destroying competitive alternatives. No one cared whether capital has been misallocated from much better uses. Both political parties were in full agreement that Uber was a wonderful company.

Uber has continued to survive despite terrible economics because it was the poster child for the elite policies that demonized any government oversight of business and lionized the monomaniacal pursuit of capital accumulation. Membership in those elites required fully supporting those policies, just as membership in Chinese elites requires a full commitment to support the policies of the Communist Party. Despite $25 billion in losses, no one from those elites can admit that Uber might have massively reduced overall economic welfare, because that would require admitting that their overall worldview was badly flawed, and their status as elites might have been illegitimate.”

Critics claim that the US doesn’t have an industrial policy but they are missing the elephant in the room. Our government has been captured by Wall Street and our industrial policy is predatory value extraction.

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Advanced Accumulation

Posted on July 30, 2021 by camelotkidd

I’ve come to believe that the offshoring of American manufacturing jobs to China has a lot of similarities to the enclosure movement in Great Britain. The enclosure movement occurred in the 17th and 18th centuries when the aristocracy threw the peasants off the common land and reduced them to a vagabond underclass, all the better to create a desperate workforce to staff the factories of the Industrial Revolution.

Where there was primitive accumulation in feudal times there is now advanced accumulation. Since the advent of neoliberalism in the 1980’s, American corporations responded to shareholder demands for increased profits by downsizing or offshoring full-time employment and replacing it with a floating pool of part-time and freelance workers without benefits or job security. To grasp how we got to this point it’s imperative to understand some economic history. Since 1979 and the Volker Shock, the US has entered a post-Fordist economy where manufacturing has been surpassed by financialization. This was a deliberate policy made in large part to reassert capital’s power at the expense of workers. It has been a grand success from the point of view of America’s billionaire class.

Despite the endless praise for globalization at this point it’s obvious that the source of corporate America’s unprecedented explosion in profits in the 21st century is the offshoring of manufacturing to China. The chart below of corporate profits demonstrates the stunning rise. Globalism cheerleaders claimed that this dynamic would benefit all Americans but they lied.

Maximizing profit is all about reducing costs. China had coal fired power stations to provide cheap energy. China had lax regulations reducing environmental and health and safety costs. China had low taxes and a minimal welfare state. China had a low cost of living so employers could pay low wages. China had all the advantages in an open globalized world.
US corporations couldn’t wait to off-shore to low cost China, where they could make higher profits.

Now, the American economy is entirely dependent on manufacturing in China. America’s short-sighted obsession with increasing profits to fund buybacks and golden parachutes for corporate insiders and vast fortunes for financiers has led to a dangerous dependency that has handed China tremendous leverage, which China is now starting to make use of. Essential parts and feedstocks become unavailable for all sorts of flimsy excuses, prices double, triple, then double again, and since we’ve allowed our entire economy to become dependent on a handful of sources for these essentials because that dependency maximized profits, then there are no alternatives

As you can see this short term profit bonanza is starting to bite corporate America in the ass. Not to mention US national security.

Because of the new Cold War being waged against China, the stupidity of the out-sourcing of manufacturing to China is getting all the attention but I think it’s crucial to note the similarities between our milieu and what Karl Polanyi called the Great Transformation.

During feudalism peasants had the time and space to create a rich, vibrant society. Even under Fordism there was time and space for society, where weekends and leisure time were still relatively untouched. Today, however, capital seeks to exploit our sociality in all spheres of work. We are in a state of harassed busyness from which-we are promised-there will never be any relief. This is not an accidental side-effect of post-Fordist labor. It’s highly advantagous for capital for our time to be short and fragmented. The loss of our time helps explain our stultified and repetitious culture. Neoliberalism promised that the destruction of social security would have dynamic effect of on culture and the economy, liberating an entrepreneurial spirit that was inhibited by the bureaucratic social-democratic institutions of the New Deal. The reality, it turns out, is that innovation and creativity require a certain amount of stability. The disintegration of social-democracy has had stultifying rather than a dynamic effect on culture, arts and creativity, in addition to the massive loss of freedom.

Personally, I think that reestablishing class power and control was the whole point, but that’s just me.

We can see the results all around us if we care to look. Primitive accumulation drove the peasants off of the land, where they could be self-sufficient, into the maw of the Satanic Mills. Advanced accumulation has likewise destroyed American society by eliminating stable work and replacing it with a temporary, on-call, precarious workforce. The result is a bleak economic landscape with its decay and hopelessness, the deaths of despair, the opioid addictions, the abandoned Rust Belt cities, the mass shootings.

On the bright side, advanced accumulation has resulted in hundreds of newly minted billionaires, one of whom was recently able to flaunt his wealth by hurtling into space atop a giant penis rocket.

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Purple

Posted on July 23, 2021 by camelotkidd

There’s a fascinating online discussion going on that you’ve probably never heard of if you’re trapped in the liberal tribal media enclosure.

Author of the Mega-Viral Thread on MAGA Voters, Explains His Thinking. The writer, a podcast host whose real name is Darryl Cooper, set out to explain the mindset that has led so many Trump supporters to believe that the 2020 election was fraudulent and, more generally, to lose faith and trust in most U.S. institutions of authority. The writer especially calls out our corporate media, who he says are incapable of understanding let alone accurately describing the views of a group of people they view with little more than unmitigated contempt, condescension and scorn. He also believes it is imperative that people understand the actual reality of what is motivating so many Trump voters in their views, perceptions and beliefs — regardless of whether each particular belief is accurate or not.

I know what you’re thinking but you really need to understand this perspective if there’s any hope of reconciliation, or worst case scenario–avoiding a civil war.

What’s amazed me about all that has transpired since the election of Donald Trump is the way in which the narratives and actions of the political and media elite have transformed liberals into fervent Cold warriors, while conservatives have gone the reverse, becoming suspicious of American exceptionalism. What’s even more fascinating is that Russia-gate, which I have written so much about, seems to have been the galvanizing event.

Cooper claims that “many of them deny it now, but a lot of 2016 Trump voters were worried during the early stages of the Russia collusion investigation. True, the evidence seemed thin, and the very idea that the US and allied security apparatus would allow Trump to take office if they really thought he might be under Russian blackmail seemed a bit preposterous on its face. But to many conservatives in 2016 and early 2017, it seemed equally preposterous that the institutions they trusted, and even the ones they didn’t, would go all-in on a story if there wasn’t at least something to it. Imagine the consequences for these institutions if it turned out there was nothing to it”

After there was nothing to it conservatives, and yours truly, waited in vain for some sort of reckoning from our elite political and media. When everyone moved on like nothing untoward happened there was some serious soul searching by conservatives. As Cooper says, “this is where people whose political identities have for decades been largely defined by a naive belief in what they learned in civics class began to see the outline of a Regime that crossed not only partisan, but all institutional boundaries. They’d been taught that America didn’t have Regimes, but what else was this thing they’d seen step out from the shadows to unite against their interloper president?”

What’s darkly humorous is that the neoconservative foreign policy elite couldn’t have scripted a better ad campaign to convince liberals that the empire is A-OK. But in the process of attempting to depose Trump the deep state emerged from the shadows long enough for conservatives to grasp the danger of having an unaccountable, secret government.

Here’s where Cooper makes the connection. “It’s hard to describe to people on the Left, who are used to thinking of American government as a conspiracy and are weaned on stories about Watergate, COINTELPRO, and Saddam’s WMD, how shocking and disillusioning this was for people who encouraged their sons and daughters to go fight for their country when George W. Bush declared war on Iraq.”

Again, this whole thread is pretty amazing and I strongly urge liberals to read the whole thing. I’m no fan of the Donald or Republicans in general but what really got me was the reaction of liberals to the election of Trump. The shock and horror made them impervious to logic, historical perspective or common sense. They acted like Hillary was the personification of goodness while Trump was literally the devil. I mean, what the fuck! Were they unaware of US foreign policy while Clinton was Secretary of State? Was I the only one who saw the video of Hillary exulting–“We came, we saw, he died”–upon learning of Gaddafi being sodomized. Going further, were liberals completely oblivious to the conditions in America that enabled a hustler like Trump to even get within striking distance to the presidency? The late capitalist dystopia where untold thousands of people die every single year as a result of an exploitative status quo which makes them sick and impoverished, and is made possible solely because of a highly advanced propaganda campaign by the plutocratic class.

Yet the Democratic party spent zero time in rhetrospective, immediately pivoting to Russia-gate. And for liberals, it got downright embarrassing. Because it was Trump they immediately embraced the worst of the deep state actors–John Brennan of the CIA and James Clapper of the NSA. They built a fucking shrine for Robert Mueller of the FBI. The fucking FBI! The lack of historical reference boggled my mind. The FBI is the US’s political police, who’ve spent decades going after progressives, but bygones, now that they’re after Trump. Or something.

Ultimately Trump’s empire apostasy had zero effect. Conservatives, who see Trump as a deep state warrior need to admit that the deep state ran rings around him, perhaps because he appointed deep state swamp creatures into his administration. These creatures spent their time merrily sabotaging any and all efforts to end America’s wars and curtail its regime change shenanigans.

Not to give myself too much credit but I’m not as susceptible to the tribal dynamics because I’ve learned to tune out the tribal narratives and instead follow the money, the weapons and resources, and observe the actions of our feral elite. In the meantime my goal is to try to bridge the red/blue divide.

Call me purple.

The question I ask every day is how do we try to build the solidarities that we need to have, to change the society in the ways that make it better for everybody who lives in it when we live in this tribal hall of mirrors where partisan bickering is given more prominence than the reality of the American empire? An empire where Americans no longer possess political power and where corporate rule has replaced constitutional republicanism.

Here’s where Cooper says conservatives are after all of this. “I encourage people on the Left to recognize the once-in-a-lifetime opportunity in front of them. You’re not going to agree with the conservatives on everything. But if in 2004 I had told you that the majority of the GOP voter base would soon be seeing the folly of the Iraq War, becoming skeptical of state surveillance, and beginning to see the need for action to help the poor and working classes, you’d have told me such a thing would transform the country. Take the opportunity. These people are not demons, and they are ready to listen in a way they haven’t in a long, long time.”

Perhaps history is starting again, which means nothing is fixed and there are no guarantees.

To save our republic we will need to work together. There can be no team red or team blue. We all need to be purple.

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Pattern Recognition

Posted on July 16, 2021 by camelotkidd

The American empire has not become kinder and gentler just because they are flying the rainbow or BLM flags at our embassy’s. Or because there is now a lesbian at the helm of the CIA directing drone strikes. Or because the CIA has a new ad touting its diversity.

Only NPR listening, New York Times reading liberals believe such nonsense. These same people also believe that the election of Joe Biden made the US a kinder and gentler country after the horror of Trump.

As I’ve been describing in my recent posts on neoliberalism, the US empire is based on financialization and that hasn’t changed. Moreover, the US, is effectively an oligarchy. In 2014, Princeton did a study which found that the opinion of anyone who is not part of the oligarchy has no effect on what the government does. Which means, as we’ve seen, that it doesn’t matter which party is in charge because the policies remain the same.

Maybe this has something to do with the neoliberal proclivity to seize the state for their own purposes not reduce it or destroy it? Hence neoliberals are inclined to explore new formats of techno-managerial governance that protect their ideal market from unwarranted political interference. Indeed, neoliberals preach that the “government, beyond its proper sphere ought not to have any power; within its sphere, it cannot have enough of it.”

If this sounds suspiciously like a definition of our illusionary deep state give yourself a cookie. If fact, I’ve come to believe that the advancement of neoliberalism and the US deep state are connected at the most elemental level. It’s the perfect governance for neoliberals with their double truth, where they get the appearance of a democratic republic as a cover story, while in reality the important decisions are made behind the scenes by a select group of elite to manage the worldwide empire that provides their wealth and power.

It’s crucial to note that neoliberalism and the modern deep state came together against the the threat of communism. This manifested itself in an embrace of fascism as a bulwark. The corruption of US foreign policy by the connection to fascism began in the interwar period. Historical records clearly show that the fascist powers–Germany and Italy–were funded by Wall Street, for ideological and monetary reasons. After WWII, in their fervor to combat communism and the Soviet Union, American planners supported fascist dictators and spirited thousands of Nazi’s out of postwar Europe, many to the US. Meanwhile, the neoliberals, led by Freidrich von Hayek, drew much of their inspiration for the construction of an ideal market society from Carl Schmitt, Hitler’s political philosopher.

Going further, I believe that the modern American deep state metastasized in response to the threat of communism but also to the the threat of the New Deal, or indeed, any alternative to predatory capitalism.

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Double Truth

Posted on July 9, 2021 by camelotkidd

Neoliberalism, as a political ideology focused intently on maximizing the power of “capital,” deploys a double truth to cover its inherent contradictions: 1) that an ideology dedicated to liberal values has to continuously resort to illiberal practices; 2) that an ideology that venerates spontaneous order has to resort to authoritarian regimentation and control; 3) and that an ideology that claims that a free and open “market” is the pinnacle of information processors engages in the promotion of ignorance.

As you can see, these contradictions pose a problem, one that has confounded neoliberals since their initial conclave at Mont Pèlerin. For instance, if their comprehension of an ideal society is correct, then why don’t the intellectuals and vast mass of the public simply get with the program?

Instead, there’s an esoteric truth for members of the inner circle, who act like a Leninist “vanguard of the proletariat, poised to infiltrate the government and immunize policy from the optimally stupid electorate,” who are to be content with an exoteric truth. Members of the inner circle, technocratic elites, maintain the veneer of democratic consent while reconfiguring government functions in a neoliberal direction.

The key objective of a double truth is to maintain power. Double truth world-views are what hold the empire together; the powerful spend so much energy propagandizing us because they need to in order to retain power. In case this wasn’t already abundantly clear, the neoliberal ruling classes have no intention of giving up control of the global capitalist pseudo-empire they’ve been working to establish these last sixty years. Freedom has nothing to do with democracy or speech or individual rights: for the neoliberal it is about the freedom of the market and the elites who control those markets. 

Double truth is not exactly propaganda, although there are some similarities. While official propagandists are definitely pleased if anyone actually believes whatever lies they are selling, deception is only part of it. The primary aim is to generate an ‘official narrative’ that can be mindlessly repeated by the ruling classes and those who support and identify with them. This official narrative does not have to make sense, or to stand up to any sort of serious scrutiny. Its factualness is not the point.

Instead, the whole concept of “fake news,” that’s been with us since the election of Donald Trump, should be thought of as the culmination of double truth. As the foremost neoliberal historian, Phillip Mirowski says, “The aim is not nihilism for the hell of it, but rather, represents the pursuit of two objectives dear to neoliberals: [1] The transformation of the endless befuddlement of the masses into a lucrative source of recurrent profit; and simultaneously, [2] the rendering of the populace more docile in the face of neoliberal takeover of the government.”

Unfortunately, double truth hasn’t been simply confined to economics and has become an integral part of our ruling elites skill set. We witnessed it in the run up to the invasion of Iraq when Bush chief of staff, Andrew H. Card Jr. blurted out, that from a marketing point of view you don’t introduce new products in August. We heard it from Karl Rove when he told Ron Suskind that “guys like me were ‘in what we call the reality-based community,’ which he defined as people who ‘believe that solutions emerge from your judicious study of discernible reality.’ […] ‘That’s not the way the world really works anymore,’ he continued. ‘We’re an empire now, and when we act, we create our own reality. And while you’re studying that reality—judiciously, as you will—we’ll act again, creating other new realities, which you can study too, and that’s how things will sort out. We’re history’s actors…and you, all of you, will be left to just study what we do.”

Far from chastising our feral elite, the invasion of Iraq and disastrous aftermath seemed to signify a new phase of lawlessness and contempt for honesty. The Wall Street Crash, where the lies came fast and furious. The Syrian misadventure, where the US partnered with Al Qaeda to overthrow the government of Bashar Assad while simultaneously waging a “War on Terror” against Sunni extremists. The attempt to overthrow the Ukrainian government using Nazi’s while decrying anti-Semitism in Europe.

In fact, I’ve come to believe that the deep state that I’ve discussed ad infinitum is the perfect representation of double truth, where there’s an exoteric truth that the US is a noble if imperfect republic, while the esoteric truth is that the real decisions are made by shadowy intelligence agents, Wall Street bankers and Silicon Valley billionaires.

Thanks to the gallant efforts of the corporate media, with their partisan echo-chambers, it has never been easier for our putative leaders to deploy double truth. Hell, they could deploy a triple or quadruple truth in our hyper-partisan media environment and I doubt anyone would notice. Unfortunately, reality, as they say, has a liberal bias. And so the people who have spent their entire lives doing nothing but manipulating other people’s beliefs are incapable of dealing with Covid or climate change or all of the myriad of other problems that are barreling down the pike at us.

As it stands I don’t think they have any intention of saving us. I believe that the end game is clearly in view. If your plan is to allow the world to spiral towards mass death and destruction while you retreat to a bunker in New Zealand or some other isolated area to live out your days in comfort, protected by armed guards, you’re unlikely to win much in the way of public support. Better to keep the militarized bunker thing on the low-down and keep people thinking that “we’re all in this together” and if we just install solar panels, recycle more, ride their bikes to work and so on we’ll somehow turn it all around and march arm in arm towards a happy and sustainable future.

I think that if I learned anything with this little exercise it’s to know them by their deeds rather than their double truths. Ignore the narrative in your partisan news feed and follow the money, follow the resources and weapons, and follow what our feral elite are doing rather than saying.

PS: Bezos, Branson and Musk are rocketing into space.

I hope they don’t come back.

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Debt as a Weapon

Posted on July 8, 2021 by camelotkidd

Michael Hudson has a new post up discussing the future of the dollar as the world’s reserve currency. Here’s taste:

“Since Roman times, creditors have forced debtors who could not repay to forfeit their assets through foreclosure or forced sale. Though the medieval age recognised the ills of debt in its injunctions against usury, capitalism resurrected this aspect of Roman law. To be sure, the tyranny of creditors was sometimes vanquished by powerful debtors: Philip IV of France destroyed his creditors, the Knights Templar and Edward III of Britain defaulted against Italian banks, bankrupting them. Overall, however, the creditor interest has asserted itself repeatedly. In the post-Civil War US, it imposed a deflation that led to widespread farm bankruptcies, impoverishing farmers in an infamous monetary deflation. This was repeated in the Great Depression of the 1930s, by President Obama after 2009, as well as by the IMF and its Structural Adjustment Programmes in the developing world in the 1980s and 1990s.

Enforcing the legal fiction of debt as an exchange relation was the necessary condition for commodifying paper money. The sufficient condition involved capitalist states imposing on themselves a monetary self-abnegation when it came to issuing money. Government-created money never needs to be paid back, and does not expand the power of private creditors. So, when governments began limiting their own issuance of money and even borrowing form private creditors, they left the overwhelming amount of money creation as a source of profits for private creditors, banks and financial institutions and founded veritable creditocracies, by backing their financial interest with political power. Such arrangements were already being made in the earliest years of capitalism, when private creditors made their pacts with states hungry for funds to fight wars. Lenders ensured that states did not tax them but borrowed from them (Ingham, 1984, 48-9, 99-100) and states often settled war loans by giving creditors monopolies, such as the East and West India Companies, South Sea Company and the Bank of England.”

This is how capitalist states have used their power to create, preserve and extend that of their financial sectors, including over themselves. There is a cost to this. Leaving the issuance of the overwhelming amount of money in circulation to competing profit-seeking private creditors makes them touts and pushers of debt and their activities regularly lead to crises, followed by state bailouts and new financial regulation.”

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Hudsonism

Posted on July 2, 2021 by camelotkidd

I’m pretty sure that a lot of leftist’s have not realized that Marxism, as a way in which to critique industrial capitalism, has been made largely irrelevant by neoliberalism.

Moreover, by insisting that the “market” is the most advanced information processor, neoliberalism makes socialism impossible, since the main motive behind socialism was to impose “rationality” upon a putatively irrational and destructive market system. Socialists like Marx and Polanyi, generally based their argument upon an Enlightenment conviction that markets produced debilitating consequences that could only be rectified by intelligent planning and government intervention. However, since socialist planning presupposed the planner knew more than the market, and since that was impossible, so, too was socialist economics. The end result is that neoliberal philosophy developed over the decades since the 1940s constituted a profound break from this entire tradition, with the divorce leaving Enlightenment conceptions of reform stranded, hollow and ineffectual. In essence, socialism and Marxism were stripped of any rational philosophical basis and socialist political movements no longer make any sense.

In Never Let A Serious Crisis Go To Waste, Phillip Mirowski, says that “Not only does neoliberalism deconstruct any special stays for human labor, but it lays waste to older distinctions between production and consumption rooted in the labor theory of value, and reduces human beings to an arbitrary bundle of investments, skill sets, temporary alliances, and fungible body parts. Government of the self becomes the taproot of all social order.” Mirowski claims that neoliberalism “acts as a solvent dissolving” Marxism and socialism, where concepts like proletariat and class are drained of any meaning.

As Margaret Thatcher, made abundantly clear, under a neoliberal regime, “there is no such thing as society.” This comprehension is fundamental to understanding our modern world. Neoliberalism is ultimately a political philosophy rather than an economic ideology and as such has become our societies operating system-OS

All of this and more is why I’m a Hudsonist.

Michael Hudson is a heterodox economist and trenchant critic of the financialized, neoliberal capitalism that organizes the US. Hudson started his career as a balance of payments economist for Chase Bank and began to comprehend how debt is used as a method of control, both domestically and internationally. He harkens back to a pre-capitalist political/economy where intellectuals such as John Stewart Mill sought to create an economy that was free from land and financial “rents,” by examining the contrast in whether money and credit, land and natural monopolies will be privatized and duly concentrated in the hands of a rentier oligarchy or used to promote general prosperity and growth. He advocates for a cancellation of debts to save populations from being reduced to debt bondage and dependency (and ultimately to serfdom), and redistribution of lands to prevent its ownership from becoming polarized and concentrated in the hands of creditors and-landlords. This polarization is the key feature of US neoliberal political/economy.

Furthermore, Hudson argues that this dynamic is the key to understanding why the US has declared war on Russia and China. China and Russia are existential threats to the global expansion of financialized rentier wealth. Today’s Cold War 2.0 aims to deter China and potentially other counties from socializing their financial systems, land and natural resources, and keeping infrastructure utilities public to prevent their being monopolized in private hands to siphon off economic rents at the expense of productive investment in economic growth.

As you can see, Hudson makes the crucial distinction between productive and extractive economic activities, something the neoliberals have spent decades obscuring. The key to Hudsonism is a robust infrastructure that creates a productive, low cost economy, open to small businesses and entrepreneurs, rather than the toll-booth economy 40 years of neoliberalism has produced.

Presently, Congress and the Biden administration is struggling to pass an infrastructure bill that illuminates our situation. In a perverse twist, the pandemic has provided a space for an appraisal of past behavior. The intolerable costs of austerity and a culture that celebrated individualism and undermined the state has been starkly revealed. 

Not only do members question whether Congress can work, some of them don’t think it should. One of the “pay-fors” in the bipartisan package involves privatizing the government’s assets, or selling off public assets to find the money to build the infrastructure. (This is sometimes called “asset recycling.”)

“Asset recycling” contradicts the essence of Hudsonism, where a muscular public sector can benefit everyone’s interests. Instead, thanks to the indefatigable efforts of neoliberals, there’s this deep-seated belief that government can’t do things it did routinely in the past, and only by creating private toll roads and selling water systems can we improve the country’s infrastructure. It’s untrue, but it’s part of a belief system that government shouldn’t be a factor in people’s lives.

Understanding this dynamic allows us to glimpse the endgame where the infrastructure bill will be more of the same privatization of governance through public/private partnership. In the name of building world-class infrastructure, these lawmakers would sell it off in fire sales to private financiers.

As the American Prospect’s David Dayen has pointed out, the bill is, quietly, a vehicle to retry Trump’s failed attempt to sell the country’s public infrastructure to corporate America, so they can jack up road tolls and other user fees and further pick the pockets of ordinary working Americans. Wall Street is positively licking its lips at the prospect.

Presently the stakes could not be higher. It’s not an exaggeration to state that every critical problem facing our country is caused by neoliberalism.

Even as hundreds of thousand Americans died and millions lost their livelihoods, America’s billionaires made out like bandits, but neoliberalism treats inequality not as a problem but a “necessary functional characteristic of their ideal market system.” The privatization of infrastructure, schools and other key governmental functions are to be applauded not decried. The ongoing wars of empire where the U.S. continues to spend more on its military than the next thirteen countries combined, while Americans they are told that they cannot enjoy a sustainable let alone quality standard of living without working two or three dreary hourly-wage, benefits-free jobs for rapacious corporations.

If there’s any chance of stopping this assault it’s crucial to understand our enemy. But it’s also crucial to devise a path forward from “there is no alternative” to neoliberalism.

Hudsonism is our travel guide.

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Winter Patriot

Posted on June 18, 2021 by camelotkidd

In almost every action movie made by Hollywood, an intrepid, heterodox hero confronts an evil, authoritarian empire. Even though the odds are stacked against our intrepid hero, he or she somehow manages to overcome the odds through sheer pluck and defeat the evil empire.

Yet, in the US the opposite is true. The political elite in concert with corporate media has convinced its citizens that the American empire is the hero, while plucky, heterodox journalists, like Julian Assange are the villains.

This suppressed reality is a major reason why I’m such a trenchant critic of the American empire. The elite managers of imperialism, the masters of war, the corporate manipulated legislative, judicial and executive branches of government and their obsequious stenographers in the corporate media, are the mainstays of the evil empire. Yet to state this simple truth is to be banished from polite society, or worse. 

I get reader criticism suggesting I am a traitor or Russian bot, but I am a patriotic American who desires a republic rather than an empire. Moreover, I am following in the footsteps of our forefathers who waged revolution against the empire of the day–Great Britain.

Our modern day empire does not work for the average American but for the feral elite, who’ve basically renounced their citizenship to become globalized. It’s obvious that they could care less about you and I as any number of destructive actions against their fellow Americans make blindingly obvious. (The Wall Street Crash and resulting theft of homes with the robo-signing scandal, and the Sackler’s opioid death count spring to mind as particularly depraved). At this point we should take the studies about the percentage of American CEOs being psychopathic maniacs seriously. Going further, the structure of our elite society, if you look at it, is just designed to incentivize criminal behavior, lying, cheating, and stealing at the highest level. The end results are all around us if you care to look.  

However, the genius of the American empire is that it’s convinced the majority of our citizens that it is no such thing. America is the “leader of the free world” whose task is to guide the world. It is not imperialism, it’s is the “duty” and “responsibility” placed upon the US by history. 

In authoritarian regimes, like the former Soviet Union, the average citizen well understood that the government engaged in widespread propaganda and censorship but here we have outsourced it to the corporate media to such an extent that most people are oblivious. Thanks to the partisan and tribal enclosures created by the red and blue corporate media our system is far superior to clumsy state propaganda. Conservatives have typically been the most fervent proponents of empire, particularly after 9/11 and the invasion of Iraq where America–Fuck–Yeah! was their battle cry and critics like the Dixie Chicks were smeared as liberal traitors. Now, after Trump and Russia-gate, liberals have transformed into fervent Cold warriors with a pathological hatred of Russia.

While the American empire propaganda is tailored to its partisan audience it is very subtle. In authoritarian regimes they have massacres and wars. In free democracies we have humanitarian interventions and R2P. In authoritarian regimes you know exactly who rules over you. In free democracies the true rulers hide behind fake puppet governments. In authoritarian regimes a single party upholds and enforces the status quo. In free democracies, two parties uphold and enforce the status quo. In authoritarian regimes the people are kept too brutalized and cowed to rise up against their rulers. In free democracies the people are kept too propagandized and brainwashed to rise up against their rulers. In authoritarian regimes you are not free, and you know it. In free democracies you are not free, and you don’t know it.

Unfortunately, the US cannot give up its messianic ideology and claims of exceptionalism. This would be truly unthinkable for the vast majority of US Americans. However, the US empire and the current political system are neither sustainable, nor reformable. Besides, empires are almost impossible to reform. The real problem for Americans is that it’s infinitely hard to renounce empire when imperialism is what you were born, raised, educated and conditioned to live with and when you sincerely believe that your brand of imperialism is somehow benevolent, even altruistic. 

But the American empire is the supreme issue affecting all others. The idea that the United States can pursue progressive policies domestically and imperial policies abroad is crazy. Everything is connected. We will never have a single-payer healthcare with an empire. We will never have a robust green infrastructure with an empire. We will never solve our runaway inequality with an empire. We will never have a republic with an empire.

Update: Every time I think I have hit peak cynicism I see shit like this.

“During an astonishingly sycophantic press conference after the Geneva summit with Vladimir Putin, President Biden claimed that the US never interferes in the domestic affairs of other countries.

The fact that the entire press corps did not erupt in side-splitting laughter at this ridiculous utterance is in itself proof that western news media is pure propaganda. The United States has directly interfered in scores of foreign elections since it began its ascent to global domination at the end of the second World War, to say nothing of all the coups, color revolutions, proxy conflicts and regime change military invasions it has also participated in during that time. The US openly interfered in Russia’s elections in the nineties, and literally just tried to stage a coup in Bolivia by interfering in its democratic process. The US is far and away the single most egregious offender in the world on this front, which is largely why it is perceived around the world as a greater threat to democracy than any other government.

This is not a secret, internationally or in the United States. Anyone who has done any learning about the US government’s actual behavior on the world stage knows this. Hell, a former CIA director openly joked about it on Fox News a few years ago.”

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Blowback

Posted on June 11, 2021 by camelotkidd

In last weeks post I presented evidence that the US attacked China with Covid 19.

My evidence is largely sourced from the Unz Review, where Ron Unz has written a series of articles arguing that COVID-19 is the result of a US biological warfare strike against China and Iran. Much of the evidence he cites is circumstantial. But his circumstantial evidence is very convincing. What are the odds that COVID-19 would appear at the worst possible place and time for China (Wuhan on Chinese New Year) and then miraculously traveled to Iran to kill a sizable number of their government elite? What are the odds that this would randomly happen when the neocons are waging a hybrid war against China, Russia and Iran? What are the odds that this virus would turn out to be a perfect anti-economy bioweapon, combining super-contagiousness with .5% to 1% lethality? What are the odds that a US military games team would have shown up in Wuhan when COVID was first unleashed? And above all, what are the odds that the US Defense Intelligence Agency would just happen to issue a strongly-worded warning to guard against an impending pandemic in Wuhan more than one month before anyone knew of any such outbreak?

What’s worse, in retrospect, is that the US has a deep state that is capable and willing to carry out such a nefarious plan. Furthermore, the fact that this deep state would carry out such a plan when the chances for global blowback are so great is more evidence of their psychopathy. Unz gives them credit for imagining that the US healthcare system would rise to the occasion and minimize any outbreak here but I’m not so generous.

It’s obvious to see how the people who want a war with China would use the new reports of the Coronavirus emerging from a lab in Wuhan to make it happen. It fully fits into the logic of the global hybrid war, unleashed by the American financial oligarchy in order to maintain world domination in the confrontation with the rapidly growing China. Presently, they feel emboldened enough to go on the offensive, blaming China for the Wuhan lab leak.

At a recent appearance on Sunday Night in America with Trey Gowdy, Arkansas Senator Tom Cotton, made crystal clear their game plan going forward. “I think the American people deserve to know what caused the worst pandemic in a century,” Cotton told the show’s host. “Look, China should be made to pay for their negligence and their deceitfulness at the outset of this pandemic: covering up its origins, not being open about what was happening in that lab in Wuhan.”

Cotton continued. “But if it turns out that the Chinese Communist Party and their labs were responsible for a lab leak that caused this pandemic, just imagine what the American people would demand in terms of accountability; what I said would just scratch the surface,” the senator said. “And the American people would be right to demand that kind of accountability.”

Thanks to the oligarchic propaganda bubble that envelopes the American people, there will probably never be accountability for the true villain even if all of this leads to a nuclear exchange. There is no reason to believe any investigation into the Wuhan lab would not be heavily biased toward a pro-US narrative and used to manufacture international agendas to attack China, while it’s probable to believe it would be.

The corporate media nowadays often show more opposition to peace than to war. The Trump administration faced hysterical media backlash for its attempts to withdraw American troops from Afghanistan, Syria, and even Germany. Columnists from the New York Times and Washington Post openly championed the deep state because the CIA, FBI, and other intelligence agencies opposed President Trump.

After last weeks post it’s probably time to reiterate that I’m not a Trump supporter even though I spend a fair amount of time criticizing liberals. Instead, I find our whole political system to be kayfabe, in that both tribes pretend to have substantial differences even when the same economic and foreign policies of empire are implemented.

The election of Donald Trump made all of this crystal clear.

In 2008 the American public was sick of George W Bush and his crew of neocons, so they elected a progressive candidate who campaigned on hope and change to replace him.

But it didn’t happen; the hope and change never came. Barack Obama continued and expanded all of his predecessor’s most depraved policies at home and abroad, and it wasn’t long before Americans became disillusioned. It was as if Obama served Bush’s third and forth term, even though many of my liberal friends and family won’t admit it.

Worn out and disgusted by crushing neoliberal policies at home and murderous neoconservative policies abroad, Americans elected a reality TV star who ran on a populist platform which criticized both Bush and Obama. Trump promised to “drain the swamp”, end the wars, and fight the establishment in the interests of ordinary people. Americans thought this time for sure there would be change.

But the wars kept going, and the swamp got even fuller, and the US empire maintained the same destructive policies of the Bush administration and the Obama administration. Despite all this, the Democratic Party and the corporate media acted as though a coup had taken place, insisting that the United States had transformed from a free democracy respected around the world into a fascist dystopia.

And now that we’ve replaced the fascist with Joe Biden we will finally–“Make America Kind Again”.

Or not.

It’s become obvious that no matter who is president the US empire will continue to carry out unspeakable acts for the benefit of the tiny group of oligarchs who actually call the shots. As Gore Vidal once said. “It doesn’t actually make any difference whether the President is Republican or Democrat. The genius of the American ruling class is that it has been able to make the people think that they have had something to do with the electing of presidents for 200 years when they’ve had absolutely nothing to say about the candidates or the policies or the way the country is run. A very small group controls just about everything.”

We get the theatre of change because of the reality of empire. Politicians cannot change the status quo to one which benefits ordinary people instead of their oligarchic owners, because the oligarchic empire is built upon the need for endless war, poverty, and oppression. You cannot have a unipolar global empire without using violent force (and the threat of it) to uphold that world order, and you cannot have a plutocracy without ensuring that a few rulers have far more wealth control than the rank-and-file citizenry.

A little blowback now and then is just another cost of empire.

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Science and the Unspeakable

Posted on June 4, 2021 by camelotkidd

Ever since the election of Donald Trump science has become a shibboleth for the liberal, professional/managerial/class (PMC’s), and–trust the science–has became their rallying cry.

But science is an abstract concept. Trust what science? Science has been responsible for clean water, space travel, solar power and vaccines but it’s also been responsible for eugenics, Zyklon-B, the atomic bomb and Agent Orange. There has been Dr. Salk but also Dr. Mengele. Indeed, any cursory appraisal of history makes it quite apparent that science and its cousin technology have raced ahead of the morality of their applications far too often. Going further, it’s no accident that science in the US is tied to either war or the logic of capitalism. This has been especially true during the present pandemic when we find that a large number of vaccines are for-profit, even if they have been funded by public money.

It’s also apparent that since the beginnings of the pandemic and Trump’s response, liberals have politicized the science behind its origins, spread and implications. Liberals were quick to dismiss any and everything Trump proclaimed with snide remarks about–trust the science. The origins of Covid was no exception. When Trump suggested that Covid originated in a lab in Wuhan he was ridiculed by the the PMC’s and the corporate media, with only MAGA supporters believing his reports. This official party-line was often harshly enforced by our leading social media monopolies, with Facebook summarily banning all posts suggesting otherwise. In other words, our understanding of the origins of Covid has been narratively managed over the past 15 months and is still being narratively managed. We are being told only what suits powerful political, scientific and commercial interests. There were a lot of noble lies told.

My how times have changed.

As it turns out, the coronavirus origin story may be another noble lie. A year ago, the idea that Covid-19 leaked from a lab in Wuhan–was dismissed as a crackpot theory, supported only by Donald Trump, QAnon and hawks on the right looking to escalate tensions dangerously with China.

Now, after what has been effectively a year-long blackout of the lab-leak theory by the corporate media and the scientific establishment, President Joe Biden has announced an investigation to assess its credibility. And as a consequence, what was treated until a few weeks ago as an unhinged, rightwing conspiracy is suddenly being widely aired and seriously considered by liberals.

The triggering event for this remarkable reversal in American elite sentiment was a closely reasoned and persuasive 11,000 word article by journalist Nicholas Wade, entitled, Origin of Covid — Following the Clues—Did people or nature open Pandora’s box at Wuhan? Wade began his long article by explaining that from February 2020 onward a huge ideological bubble had been inflated by political propaganda masquerading as science, a bubble that was afterwards maintained through a combination of journalistic cowardice and incompetence. President Donald Trump had proclaimed that the virus was artificial, so our media therefore insisted that it must be natural, even if all the evidence seemed to suggest otherwise.

Meanwhile, there’s another theory out there, (one that I’ve given a lot of thought to), that asks–Was Coronavirus a Biowarfare Attack Against China?

I know this sounds even crazier than anything found on QAnon but the logic behind it is straight forward. The US is a global hegemon in free fall, desperately attempting to hold onto its empire. The deep state actors behind the plot have already proven that they are psychopaths willing to commit any atrocity to maintain the power of the US empire (The invasion of Iraq and utilizing Al Qaeda to overthrow the Syrian government spring to mind).

Also, this would not be the first time that the US attacked China with biological weapons. During the Korea war U.S. pilots, captured by China, admitted to dropping biological weapons on China. The U.S. long denied the use of biological weapons and claimed that the pilots had been tortured and made false confessions. Decades later secret files were released which proved that the claims the pilots had made had been correct.

During the Cold War the US engaged in a massive build up of nuclear/biological/chemical weapons. On the biological front, US scientists have long been working on offensive applications while claiming it’s all about defending the American people. Researchers at a BSL-3 lab tied to the post-9/11 biodefense industrial complex are genetically modifying anthrax to express Covid-19 components, according to FOIA documents.

Moreover, there have been a number of training exercises, like the 2001 Dark Winter simulation, that have occurred in recent years that imagine the very type of pandemic outbreak we’ve experienced.

Read the articles, there are a number of them and they make a very persuasive case.

Breaking the Silence on the Origins of Covid-19

American Pravda: George Orwell’s Virus Lab-Leak

American Pravda: “The Truth” and “The Whole Truth” About the Origins of Covid-19

Next week I’ll discuss this unspeakable subject in more detail.

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