In the midst of the exploding pandemic here in the US we should not be distracted from understanding why we are in this catastrophic mess. Further we should not be distracted from taking action.
Our Situation – the dirty laundry list
The overall condition of our country is so dire in so many dimensions that it shocks even the most pollyannaish, fervent patriot.
- Our government is so corrupted that it cannot mobilize the resources and policies that dozens and dozens of countries have already demonstrated to be successful in managing the pandemic.
- In the best of times much of the population is living from pay check to pay check. If faced with an unexpected expense of $400, “27 percent would borrow or sell something to pay for the expense, and 12 percent would not be able to cover the expense at all.1
- 41% of our children live in low income or poor families.2 Even feeding our children is tenuous. Here in Hudson NY we have school buses parked in neighborhoods every day handing out food.
- The healthcare system is a catastrophe. We spend twice as much per capita as all of our developed country cohort yet have millions without insurance. Medical debt is the leading cause of individual bankruptcies. The healthcare system achieves third world results, 43rd for longevity, 55th for maternal mortality rate and 180th for obesity rate with 36% of the population obese.3
- Our national infrastructure is described by the American Association of Civil Engineers as a “D+” grade.4
- Students graduate from college and university with crushing loads of debt. These same people graduate into a job market where the average earner has not received an increase in real income in more than 40 years. Our teachers, both in the K-12 and universities where adjunct teachers are now the majority, are badly paid. School buildings are falling apart.
- The fate of brown and black people continues to reflect the original sin of the discovery by Europeans of the Western hemisphere and the subsequent founding of our country – enslavement and cultural annihilation.
- Our economy has become more and more dominated in every sector by large corporations who are stamping our competition and extracting monopoly prices. Small businesses, always the subject of adulation by our politicians, will very likely broadly disappear after the pandemic passes in 2021. They have always been fragile even while being so important to our neighborhoods and communities. After the pandemic the large corporations, think Amazon for instance, will crush them. We will be left with empty Main Streets, strip malls and vast dead shopping malls.
- We lead the world in the population of our jails. Our lead is so enormous that even our runner up challenger, Russia, can barely be seen in the rear view mirror. Our justice system only provides “justice” for the rich and corporations. What middle-class or poor person can afford $350 and up per hour legal advice. Over 94% of all criminal cases at the state level are settled by plea agreements. It is 97% at the Federal level.5 This is justice by the whims and passions of prosecutors. We have been conducting America’s longest war, the War on Drugs, for almost 50 years. It is astonishing that a policy that has failed so spectacularly for so long might continue. But, then, it was always a racially motivated project, so described by its architects in the Nixon White House.6 The police are fulfilling their role as occupiers of our domestic lives, particularly if you are black or brown. In a spill over from the 9/11 terrorist policies, the Federal government has handed out billions and turned our local police into a militarized occupation force.
- Global warming is well underway with visible consequences, yet we have no coherent national policy to deal with it.
- Wealth and income inequality has grown significantly worse, accelerating even through the long recession following the 2008 crash. Huge tax breaks for the wealthy and corporations exacerbate this. Warren Buffet, Bill Gates, and Jeff Bezos, the three richest men in America, have more wealth than the bottom 50% of the population. The richest 5% of Americans own more wealth than the bottom 67%.7
- The financial sector of the economy has grown significantly in recent decades.
- Meanwhile the US military remains king of the hill by far. We have over 686 military bases scattered on every continent (these are the ones officially identified; who knows about those held by the CIA, NSA and other secret government agencies).8 There are over 4,000 military bases within the US itself. Our spending on this war machine dwarfs every other country. In fact US military spending equals the combined spending of China, India, Russia, Saudi Arabia, France, Germany, United Kingdom, Japan, South Korea and Brazil.9. With only 4.5% of the world’s population the US spends 38% of the total global military spending.
How Did We Get Here – follow the money
First, don’t start thinking about Trump and the Trumplicans who support him. They are a vicious bunch to be sure and we need to drive them, all of them, from office. But they are a symptom of much larger and more difficult problems.
The central facts are that the rich and corporations functionally control our government, especially the Federal government. Despite our proud rhetoric of being a democracy, a government of, by, and for the people, the facts reveal that our elections are just window dressing for governance by the rich and corporations. Recent research has demonstrated the control of Congress by the rich and corporations.10 They get their way at a much higher rate than the general populace. Their concerns are the concerns of the Federal government and the solutions to their issues are framed entirely from their perspective.
At the center of this control is how we fund our political system. For example, half of the funds raised for the 2016 presidential campaigns, some $388 million, came from just 400 families.11The podcast This American Life provided an enlightening introduction to how this works in the March 30, 2012 podcast “Take the Money and Run for Office – for anyone who has ever heard the term “Washington insider” and felt outside — we are with you. So this week, we go inside the rooms where the deals get made, to the actual moment that the checks change hands — and we ask the people writing and receiving the checks what, exactly, is the money buying?” We are not talking about pocket change. In 2016 members of Congress and the Senate personally raised $908,630,815, that’s a $1 Billion, and spent as much as 30 hours a week doing it.12
This however is just part of the money problem. Since the early 1970s the rich and corporations have poured money into foundations, think tanks, and lobbying. The rich and corporations spent $3.51 billion lobbying industry in Washington DC alone in 2019 employing some 11,892 people.13 That means that for each of the 535 congressmen and senators there are 22 lobbyists. Of course to be fair many lobbyists spend their time in the regulatory agencies making sure that the rules that actually implement legislation are most suitable to their employers. With variations in scope and scale the situation is similar for state governments. The rich and corporations have been carrying out an organized campaign to set the terms and boundaries of politics and policies beginning in the early ’70s. This has included buying up university resources to assure the their version of history and values are taught. Further the rich and corporations control the mass media which feeds information and ideas to the population. The technology used has been shifting but the ownership is still in the hands of the rich and corporations. The results of this multi-modal campaign by the rich and corporations can be seen in public values and beliefs.
What are the key ideas and values fed to us by our culture and mass media?
Our educational system, mass media, politicians, even religions play a role in shaping how we think about our country and our place in the world. Here are some of the key ideas served up:
- Markets are best at deciding who the winners and losers are
- Markets are always more efficient, responsive and reliable than government
- Government is clumsy, incompetent, and corrupt – Ronald Reagan – government is the problem
- Work hard and you will get ahead with this parallel idea – if you are poor it is because you are lazy and make bad choices
- My children will be better off than me
- The best rise to the top – everyone has an equal opportunity to become rich. capitalism is a meritocracy
- Individual effort and success are the central metric of society. Every boat on its own.
- We live in a democracy where your vote means you play a real role in who represents you and how we are governed
- The US has a duty to spread democracy around the world – we are a beacon of hope – we are a unique experiment in history
- We are a country ruled by laws not men – the rule of law
- Black and brown people are layabouts, criminals, drug users, to be avoided
Every item on this list is factually false. Yet, many of them are closely held by most Americans. But who benefits from these ideas? It is the rich and corporations. They control almost all of the wealth and assets of the country as well as the government. They are the beneficiaries. Markets no longer function even vaguely as markets described in economics textbooks.14 The chaos of the private sector responding to the needs for PPE (Personal Protective Equipment) during the pandemic is hardly an advertisement for efficiency, responsiveness and reliability. Pick up your smart phone. Every primary technology in these now ubiquitous devices was invented by government.15 I won’t continue to detail the remaining myths on this list.
The rich and corporations have used the first three very successfully to destroy the protections for workers and the middle class built up most significantly during the Great Depression of the 1930s. Aided by the intellectual cover of university academics, particularly in economics and political science, they built an ideology generally referred to as neoliberalism. The list above encapsulates neoliberalism’s claims. This ideology calls for the supremacy of the individual and market capitalism with the least government possible. This led to the destruction of labor unions in the US and Britain most significantly. The policies that inhibited the formation of monopolies developed in the US beginning during the so-called Gilded Age in the 1890s And strengthened during the Great Depression were dismantled during the 1980s culminating in the Democrats with President Bill Clinton ending the protections against predatory finance in 1999. One of the most prominent outcomes of these neoliberal policies is the flattening of wage growth starting in the mid-1970s. Between 1979 and 2010 the real wages of workers in the bottom 90% of the population rose 15% while the earnings of the top 1% rose 138%.16 This gap has only widened over the last decade.
What we should do
There will be no miracle cultural transformation that will create a new more equitable, sustainable social system. We don’t have the time to wait for the wheels of history to produce a replacement for our current system of Financialized Monopoly Capitalism.
First we need to drive Trump and his Trumplicans out of office. So, we need to support the Democrats and Biden.
But, lets not be fooled by the Democrats rhetoric. They are the party of Bill Clinton and Barack Obama. Beginning with the founding of the Democratic Leadership Council in 1985, many Democrats abandoned the policies that arose during the Great Depression and fed the boom years following WWII. They essentially bought into policies that reflected the eleven key ideas listed earlier. With a sprinkling of social progressiveness they joined the Republicans in support for the whole neoliberal policy package. Thus we saw the continuation of economic policies that undermined unions, fostered the monopolization of the economy and the surge in the size of the financial sector. The North American Freed Trade Agreement accelerated globalization without adequate protections for American workers. Clinton had his “end of welfare as we know it” bill and his 1994 Crime Bill that accelerated the wave of incarceration that pushed the US way out in front of all other countries in putting people in jail. This a continuation of Nixon’s War on Crime. Finally, almost the cherry on top of this parfait of neoliberal policies the Democrats completed the “de-regulation” of the financial industry in 1999. Less than a decade later we ate that dessert during the Great Recession of 2008-12.
Biden’s nascent policy platform is pleasantly more progressive than his history would suggest. He obviously feels the need to build bridges to the left wing of the Democratic Party. This is good. But, Biden is beholden to big money donors. He is currently receiving 60% of his campaign money from big donors. $128 million as of this writing. Predominantly from people and companies in the finance sector – Wall St.17
New Ideas and Values
It will not be sufficient to develop new policies to change the course of our society. We need to actively develop and espouse new ideas and values to form the basis for a democratic political system and a more equitable and sustainable society. We need to replace the neoliberal pantheon with our own. This will create a common language around which we can address the problems we face.
- A democratic representative government is built on the participation of all people not just those with money. Corporations are not people.
- We are all in this together. Community and families are at the center of our
- The ownership and control of capitalist enterprises must broadened so that the benefits of the enterprise and the economy as a whole will redound to all of the stakeholders – owners of capital, workers, and the communities that are their home.
- Capitalism on its own cannot control and restrain the negatives – pollution, the looting of the Earth, over-production, under-production, the creation and manipulation of demand by marketing. A democratically controlled government can provide the guidance and protections required.
- We must face up to our history of racism and white supremacy. The laws, regulations and practices that enforce and recreate white supremacy must be rooted out.
- Families need to be at the center of our social and economic policies. Our children must be provided with the real means to achieve their best.
Policy Initiatives to Consider
- Radical transparency in public life. End secret anonymous money in political campaigns. No “Dark Money”. End anonymous, or practically anonymous, corporations. Every corporations must reveal their beneficial owners – the real human beings holding shares. End anonymity on the web. Demand and enforce that everyone engaging in public on the social web use their real legal names.
- Take action to reverse Citizens United and the mantra that money equals speech.
- De-monopolize the economy. Break up the monopolies that dominate almost every sector of the economy.18 Apply the anti-trust laws developed during the 1890s and early 1900s as they were originally used. Reverse the interpretation of these laws that was created under Reagan and continue to this day that foster the monopolization.19
- The finance sector needs a thorough purge of activities that are based on fraud (high speed trading) and gambling with other people’s money. Return banking to its core activities.
- Tax high frequency trading in the financial industry. Investment is good; gambling is less than zero-sum.
- End tax rules that favor financial industry returns over productive labor.
- Make unionization of the workforce possible – enforce labor laws to end contingent work as a corporate strategy to reduce costs.
- Guarantee a living income for everyone – a combination of jobs, public and private, and income supports
- Increase the minimum wage to $22 per hour (this is the 1968 minimum wage in current dollars) and automatically adjust it for inflation on an annual basis. This minimum would apply to every employed person in the country. Farm workers, domestics, day care workers, everyone…..
- Family and children – universal publicly funded day-care. Family leave. Paid 2 week vacations for everyone.
- End segregated housing policies – reverse the zoning and other land use policies that have been in place since the 1930s to enforce white supremacy in housing.
- Fund K-12 schools through income taxes, not through real estate taxes. Equalize school funding throughout the country. A child born in Oklahoma should not receive education funding $8097 while a child in Wyoming receives $16,442.20 Funding should be equalized for regional cost of living differences.
- Free college and
- Build more housing for low income people. End homelessness.
- Create a mental health system – get the police and jails out of the business of managing and housing the mentally ill.
- Universal healthcare – choose one of the many models from around the world already successfully deployed for many decades with much better results. Healthcare is a right and not a tool for the enrichment of doctors, hospitals, and the pharmaceutical industry. The outcome should be that we spend 40-50% less per capita but achieve world class outcomes.
- Transform the criminal justice system. Do away with drug laws. Reduce the length of sentences. Hire enough defense attorneys to make our rhetoric about equal justice before the law effective. Demilitarize the police. End the enormous impact of police on the Black and Brown communities. End the private prison business. Bring back and expand educational and job training programs. Make post-incarceration return to society a positive support program not an excuse to return people to jail. End money bail and imprisonment before trial except in cases of extreme danger to the public.
- Report on the Economic Well-Being of U.S. Households in 2018, Federal Reserve May 2019
- “Basic Facts about Low-Income Children – Children under 18 Years, 2016″ by Heather Koball and Yang Jiang
January 2018 http://www.nccp.org/publications/pub_1194.html accessed 7/4/2020
- https://www.cia.gov/library/publications/resources/the-world-factbook/ accessed 7/3/2020
- https://www.infrastructurereportcard.org/wp-content/uploads/2016/10/Grades-Chart.png accessed 7/1/2020
- https://www.theatlantic.com/magazine/archive/2017/09/innocence-is-irrelevant/534171/ accessed 12/2/2017
- https://www.cnn.com/2016/03/23/politics/john-ehrlichman-richard-nixon-drug-war-blacks-hippie/index.html accessed 7/6/2020
- https://inequality.org/facts/wealth-inequality/ accessed 7/6/2020
- David Vine estimates the real number to be over 800. See Vine, David. Base Nation: How U.S. Military Bases Abroad Harm America and the World, 2015.
- https://www.pgpf.org/chart-archive/0053_defense-comparison accessed 7/5/2020
- ”Democracy and the Policy Preferences of Wealthy Americans” by Benjamin I. Page, Larry M. Bartels, and Jason Seawright in Perspective on Politics March 2013 | Vol. 11/No. 1 and Gilens, Martin. 2014. Affluence and influence economic inequality and political power in America.
- “Small Pool of Rich Donors Dominates Election Giving” by Nicholas Confessore, Sarah Cohen and Karen Yourish https://www.nytimes.com/2015/08/02/us/small-pool-of-rich-donors-dominates-election-giving.html
- Torres-Spelliscy, Ciara. 2017. “Time Suck: How the Fundraising Treadmill Diminishes Effective Governance”. SSRN Electronic Journal.
- http://www.opensecrets.org/federal-lobbying accessed 7/6/2020
- I’ve written about this in “The Monopolization of America” or here is an 11 minute video, “Robert Reich – the monopolization of America“.
- see Mazzucato, Mariana. The Entrepreneurial State: Debunking Public vs. Private Sector Myths. Revised edition. New York, NY: PublicAffairs, 2015.
- https://www.opensecrets.org/2020-presidential-race/candidate/joe-biden?id=N00001669 accessed 7/11/2020
- see The Monopolization of America
- One of the ironies of all the rhetoric from free market neoliberals about innovation and small businesses is that the rate of new business formation, a key indicator of the vitality of an economy, has been in decline for more than three decades.
- https://www.governing.com/gov-data/education-data/state-education-spending-per-pupil-data.html accessed 7/10/2020