Can We Overcome Our Stupidity In Time?

In the 1980s the United States was ruled by the very right wing Reagan regime. Such a construction does not imply that its predecessor was left wing. Historically, the left is concerned with the welfare of the broad mass of the population and the right pursues the interests of wealth. From that perspective, the US has always been controlled by the right. Even the Roosevelt New Deal was not leftist but realist in that its social welfare programs were meant to stave off radical, if not revolutionary, threats represented by the example of Soviet socialism thus to preserve the rule of private property. To say that the Reaganites were very right wing is merely to acknowledge the extremity of its views and actions: to roll back New Deal gains and public expenditures for the broad population, to destroy unions, to increase the wealth and power of the richest, to eliminate the Soviet Union itself. That many working class Americans had, perhaps still have, a fond and benign view of the "Gipper" merely illustrates their ignorance and lack of understanding. It doesn't appear that knowledge and understanding have grown over these past 25 years. Not knowing is ignorance; not learning is stupidity. A "Shoe" cartoon of post-election 1980 had a caption saying that Americans finally got the government they deserved.

In the midst of the worst recession since WW II (today's papers still use references to 1982-3) Reagan massively cut taxes for the wealthiest, massively increased military spending, massively cut social programs, and began the huge increase in the federal debt. We are now in the third decade of large government debt which has the effect of crowding out social spending and, if they can manage to keep us afraid enough, keep the military budget huge and growing. This makes the rich happy (at least for a few months at a time, until their greed returns, as hunger always does. Marx himself wrote that there is no end to wants.) and the defense contractors profitable. This assault upon the "left" cut federal funding to education by about 50%, created the desire for, and news stories about, housing in "good" school districts; thus was planted the seeds of the housing boom which has imploded over the past year or two. Reagan also cut funds for libraries, producing a crisis which is still playing out. At the same time that Reagan was supporting Solidarity in Poland, a workers' movement that challenged successfully that government, he fired the Air Traffic Controllers, destroying their union. I remain amazed how that very pointed contradiction didn't merit much mention in the media. Of course, the media was undergoing consolidation. Capital Cities bought ABC, and the largest shareholder at that time of Cap. Cities was William Casey, who became Reagan's CIA director. The CIA has a long, sordid, documented history of using journalists and prominent "culture warriors" to spread propaganda. The violent and illegal Contra war against Nicaragua was run out of Honduras by John Negroponte and Casey, ably assisted by Robert Gates, currently Democrat Obama's Secretary of Defense. Tracing the genealogy of wealth and political power for the past 70 years is amazingly revelatory though too long for blog posts. But the bad penny thesis holds and there sure are a lot of tarnished coins floating about.

The changes wrought by historical development caused economic stagnation since capitalism is based upon growth and scarcity. Productive capacity and productivity make it easy to flood markets with goods. Finding customers with money is harder. So financiers have completely taken over the economy making money from money, a fundamentally impossible task. Fed and Treasury policy since Nixon's day have been about inflation and the siphoning off of surplus. Now, taxpayer funds are shifted to Wall Street, with crippling debt service stretching farther than we can see. But the automakers will endure bankruptcy as this will destroy union contracts and pensions, which is sort of the point. Funding for social programs withers and the future for the health of our increasing poor is bleak indeed. So an assault to split workers from the unemployed through resentment is on the menu. There was a report today about how much it's costing those with private health insurance to allow the poor medical care, and, of course, how public funding would create rationing, as though high-cost private insurance wasn't itself rationing. Perhaps we should have doctors auction off services to the highest bidders.

The rule of the rentiers is tied into wonderful world of intellectual property. We are looking to a future of royalty payments to genetically modified grains and entertainment producers, and the list goes on and on. Almost like a return to feudalism though we won't be as well taken care of as serfs of the past. Analysis from a worker's (including those unemployed) perspective doesn't get any media play; our highly individualistic, winner-take-all culture is supposed to be the pinnacle of a Calvinistic god's creation. And even on the political left disagreement and shoddy analysis are the rule. Most intellectuals are entranced by the ability to blow hot air; I'm not certain they care what happens as long as they can talk and write about it. Some think the development of microelectronics has undermined the surplus value paradigm. I have my doubts about that. Irving Fisher, Yale professor, wrote in 1929 that the stock market had reached a 'permanently high plateau' until it crashed a few months later. Then,in 1933, Professor Fisher wrote the canonical analysis "The Debt-Deflation Theory of Great Depressions" in which he claimed that scarcity had been eradicated and productive capacity was sufficient to fulfill all human needs. His debt-deflation theory is what motivates Bernanke at the Fed and why he and his cronies are so hot to prop up the banks and asset prices in general. If prices fall faster than debts (in real value terms) then the more debts one pays off the more indebted one becomes. Inflation or deflation: the poles between which capitalism swings.

As things worsen, and they will, in our real lives (not stock trading lives) the media will assist in the propaganda campaign to split us and turn us against each other, killing each other and the poor of other nations. It would seem to need a miracle for the majority of Americans to get a handle on how they've been used and abused and manipulated and lied to and what it would take to change the structure and direction of the country. Most likely we are looking at catastrophe, the real not the metaphorical kind, and other countries and other peoples may take the lead in moving forward. This morning I heard on the news that Americans have gone from buying 16 million cars a year to now buying 9-10 million. As someone remarked about Germany: If your economy is built on people buying a new car every 3 years and they switch to buying every 5 years, you're screwed. Solving our problems requires fundamental change and that does not mean further impoverishing workers. After capitalism came to Russia workers there made in 1992 only 40% of what they made in 1991, and word is that the Poles will be lucky if they regain 1989's income by 2015!

Usually the solution to economic crisis is cast in "Keynesian" terms, named after the British economist John Maynard Keynes, who, with America's Dexter White, worked out a plan of government spending for employment to fill the slack left by private employers. Full-bore Keynesianism has never been tried and Dexter White paid the price for his 'radical' views during the McCarthy hearings. One little noted recommendation of Keynes was 'euthanasia for rentiers.' Or, as the Bolsheviks put it: eliminate the kulaks as a class. Now, more than ever, this task confronts the world and not just Americans. From IMF and WB and WTO and Wall Street and Washington and City of London: the financiers are sucking our blood. They really need a stake through the heart.