“Safe Passage…, with a Big If: A Review of Paul Craig Roberts’ The Failure of Laissez Faire Capitalism”

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PCR-LaissezFaire“Safe Passage…, with a Big If: A Review of Paul Craig Roberts’ The Failure of Laissez Faire Capitalism

By Gary Corseri

Here’s a book that presents its theses nimbly, deftly, consummately. Roberts can be as “elegant” as a mathematical proof, and as down-to-earth, colloquial, no-B.S. as a man who has walked the windy labyrinths of power, observing closely, “testing axioms on the pulses,” and finding his own way to what works—and to Truth. Economics may be the “gloomy science” for most of its glum practitioners, but in Roberts’ humanist hands, it’s a scalpel to carve order from disorder—to framework the challenges of our precarious, modern, globalized world; to alert us to the dangers we face now, and the even graver threats ahead if we cannot restore real democracy, moral sensibility and rational balance.

This youngish septuagenarian, who was Assistant Secretary of the Treasury (under Reagan’s “regime”), as well as an associate editor of the Wall Street Journal and a columnist there and at Business Week, regularly posts his work at the best progressive and “conservative” sites in the country—and, in fact, in the world. You can’t tie Roberts to one ideology. (You can learn more about him at his website: www.paulcraigrobers.com.) What’s clear is his commitment to understanding the mess we’ve made of our world, and re-visioning, rebuilding it. The last two paragraphs of this book sum up that commitment:

“Economist Herman Daly put it well when he wrote that the elites who make the decisions ‘have figured out how to keep the benefits for themselves while “sharing” the costs with the poor, the future, and other species.’

“Empty-world economics with its emphasis on spurring economic growth by the accumulation of man-made capital has run its course. Full-world economics is steady-state economics, and it is past time for economists to get to work on a new economics for a full world.”

“Empty-world economics” is Roberts’ phrase for academic theorizing (often simplistic in spite of highfalutin’ rhetoric) which ignores the complexities of a “full,” entangled world, occupied by real human beings who suffer! In the economics of a full-world, “nature’s capital (natural resources) and ability to absorb wastes are being exhausted.” The “cost of nature’s capital is not included in the computation.” While Wall-Streeters, CEOs and hedge fund managers are awarded multi-million dollar bonuses for “saving” billions of dollars in labor costs, they have, in actuality, merely “externalized” the costs—off-shoring millions of US jobs and fracturing the US tax base that used to support our education, our infrastructure, our culture, leaving the vast majority of Americans swimming in the swill of their excesses and pollution. These culprits have been “off-shoring” (outsourcing) all manner of jobs—low-tech and high-tech—while simultaneously “importing” foreign laborers to America on H-1b or L-1 work visas. American Labor gets the Big Squeeze while corrupt banks and corporations get the Big Hand-out.

In a fine, 20-page preface to Failure, German economist Johannes Maruschzik informs us that “the book is written by an independent thinker who is not afraid to question conventional wisdom… Roberts is closer to the libertarians than to those who think governments must run the economy… High tax rates discourage work and saving…” But, “this historical turning point”—where the world is now–necessitates an agile intellect, and Maruschzik quotes from a letter Roberts had written him: “Libertarians think that human nature changes according to whether it is employed privately or publicly. They don’t accept that private power can be just as abusive as public power. I appreciate libertarians’ defense of liberty, but I have otherwise lost patience with them.”

It’s not that Roberts straddles the various theoretical economics fences, so much as the fact that he has been around long enough, witnessed critically enough, to know that human nature often has major “human” flaws. Markets are not self-regulating. They are “social institutions” and “the human actors in markets… require regulating.” Libertarians need to be reminded that “liberty” is not anarchy. Business is also a kind of sport, but when the rules are not clear, and fairly enforced, abuses result, resentment grows, chaos manifests.

If libertarianism needs pruning, so does neo-liberal nonsense about the benefits of “free trade in the age of globalism.” Western laissez faire capitalism has not been about producing “tradable” goods for “comparative” advantages. (That’s how Adam Smith conceived of it: each country, each people, fashions or trades the products for which time and place have best suited them.) But, modern-day laissez faire capitalism has evolved into a system that seeks “absolute” advantage. Jobs are off-shored and costs of production are minimized because of “excess” labor pools in China, India, etc. The imbalances are egregious, and, according to a recent Oxfam report, we now have a world in which 85 people—imagine a small movie theater filled with 85 people!—have as much wealth as 3,500,000,000 people (half of the world’s population!). Obviously, these disparities, these “externalized” costs cannot be sustained. (For one thing, in a world as interdependent as this one, how much can really be “externalized”? They breathe China’s polluted air on America’s west coast! And, there’s a floating island of plastic as large as Texas, wafting in the Pacific.) Smith saw capitalism as a corrective to the abuses of monarchy and royalty. He was essentially a moralist, as is Roberts. Morality can be over-regulated (as centuries of Church doctrinarianism proved)… and it can be “deregulated” until it is meaningless. How do we navigate between the extremes of doctrinarianism and anarchy? How do we achieve the proper balance?

We have been struggling with that question for decades. “The collapse of the Soviet Union in 1991 and the rise of the high speed Internet have proved to be the economic and political undoing of the West,” Roberts writes. “Financial deregulation, which began in the Clinton years and leaped forward during the George W. Bush regime, unleashed greed and debt leverage.” Under neo-lib Clinton, the Glass-Steagall Act (“which had kept commercial and investment banking separated since 1933”) was repealed. Mortgages were “bundled,” given phony “ratings” by Wall Street-tight collaborating agencies, “securitized” and sold as derivatives over and over to Americans and foreigners who trusted the ratings and the reassurances of Wall Street casino operators. These “derivatives” were fraudulently insured by AIG and other companies, green-lighted by government “oversight” agencies, and our elected (selected?) representatives hobnobbed with the folks they were supposed to nab. When the “bubble” of absurdities burst, pensions burst, education funds evaporated, bridges collapsed. We live with that wreckage.

And, within the wreckage of an all-seeing, out-of-control Police/Surveillance/Military State clamping down on a disenfranchised and increasingly restive population. “In the 21st century, the U.S. economy has been kept going by an expansion in consumer debt, not by rises in consumers’ real income,” Roberts writes. The private Federal Reserve keeps “monetizing” debt (printing more money), and our “fiscal policies” are oriented towards spending more on military/surveillance/police-state actions—about ½ of the U.S. budget—while, not so oddly, we live in a more dangerous world! What is wrong with this picture?

“The U.S. could reduce the budget deficit by hundreds of billions of dollars,” Roberts writes, “by ending its pointless and illegal wars, by closing hundreds of overseas military bases, and by cutting an overstuffed military budget. This would require the U.S. to give up its goal of world hegemony.”

Clearly, the collapse of the Soviet Union, and the rise of the Internet, has facilitated global trade and production, but these new conditions have also seeded the curse of Cain—the murderous desire for absolute control or “world hegemony.” The perils are manifest: “the hubris of American elites might outlast the window of opportunity that exists for the renewal of the U.S. economy.” That hubris may also outlast the opportunity to bring the world together under a new dispensation, where excess is curtailed and fairness is an honored precept. “The assault on common sense rules, which governed American capitalism and made it humane,” writes Roberts, “resulted from the hubris created by the triumph of capitalism over Soviet communism.” How can we check the mad hubris of this Orwellian world in which “war is peace, freedom is slavery, ignorance is strength”? In 2004, Roberts predicted that the U.S. would be a “third world” nation (with impoverished masses and a bloated military) in just 20 years. We are now half-way there!

Roberts would not describe himself as a “Globalist.” That term has been perverted by “free-traders,” misled and misleading academic and media mouthpieces and “fools.” (Yes, PCR can be that blunt. He names names, doesn’t pull his punches and he doesn’t mince his words.) Not a “globalist,” but clearly this erudite, well-traveled man (educated at Georgia Tech, the University of Virginia, the University of California, Berkeley, and Oxford University) has spent his life figuring how this complex puzzle of our world is put together, how various factors interact. Part One of this compact book discusses “Problems in Economic Theory”; Part Two is entitled “The New Dispossession” (including, “The Myth of Benevolent Globalism”); and Part Three is “The End of Sovereignty.” The last part—the shortest at 16 pages—is a kind of fillip to shake us out of our media-induced fantasy-world of foreign threats (recall George Bush: “they hate us for our freedoms”!) to show how US socio-political-economic policies have impacted our world, especially our “allies” in Europe. In the name of “democracy,” “free-trade” and “laissez faire capitalism,” we have pressured and undermined the sovereignty of European Union states. We did it subtly, and not so subtly, by militarizing the EU under the cover of NATO. We exploited legitimate fears of the Warsaw Pact nations; and when the Warsaw Pact dissolved with the moribund Soviet Union, we inflated new boogeymen to fill the empty spaces of our imaginations.

We have been the global hegemonic power—the so-called “single super-power” thanks in large measure to our military might and the fact that the US dollar is the world’s “reserve currency.” We can pay our debts by printing more dollars.

But, other nations, rising economic and political-military powers, probe the sanctity of the US dollar as the world’s reserve currency. The Shanghai Cooperation Organization (SCO), led by China and Russia, explores new ways to balance their payments for goods and services. So does Iran, an associate member of the SCO. The Greek populace riots against “austerity” programs imposed by EU elites in Brussels. Looking ahead, Roberts foresees greater cooperation between Europe’s economic powerhouse, Germany, and resource-rich Russia. The “New World Order,” covered by a tattered Stars and Stripes, is crumbling like the once-grand opera house in the decrepit city of Detroit!

It is a contagion. In the words of Zorba the Greek, “the whole catastrophe!”

Roberts’ book is a singular warning. He recapitulates, implicitly or explicitly, arguments about the nature of the state and democracy that have been with us since the time of Jefferson and Hamilton—and long before then in the Roman republic and in Greece’s brilliant, but tragically flawed, ancient democracy. These are arguments about the consolidation of power, the privileges of power, the efficiencies of the state and the community, and the sovereignty and dignity of individuals.

“Hell is other people,” Sartre told us in “No Exit.” We must deal with the nature of the beast in the Labyrinth—and in the human heart if we are to find our way out of the current imbroglio. There is this fragile, tenuous hope: If we are alert, informed, brave and wise about the infinite capacity for human folly and corruption, we may find safe passage. That, of course, is a very big “if”!

Gary Corseri has published his work at hundreds of periodicals and websites worldwide, including The Greanville Post, Counterpunch and The New York Times. He has published 2 novels and 2 collections of poetry, edited a literary anthology, and his dramas have been produced by PBS-Atlanta and elsewhere. He has taught at US public schools and prisons and at US and Japanese universities. He has performed his work at the Carter Presidential Library. Contact: gary_corseri@comcast.net.




Obama’s ‘Raise’ for Federal Workers is a Bad Joke

Insulting Workers, Coddling the Rich

Dimon: among the ultra privileged, and untouchables under Obama's regime.

Among the ultra privileged and untouchables under Obama’s regime.

by DAVE LINDORFF, Counterpunch

President Obama, five years late, in his fifth State of the Union speech, decried the terrible income gap in the US, a gap which has worsened during his years in the White House. Saying he was tired of the obstruction of his policies by Republicans in Congress, he said he would take action on his own, and as evidence offered up the puny “fix” of raising the minimum wage paid to employees working on federal projects from its current $7.25 to $10.10 per hour. This executive order, which could have been done when he took office in the depths of the Great Recession back in 2009, would be not immediate but would be phased in over the next three years.

What a pathetic joke!

As the New York Times pointed out the next day in its report on the president’s speech, the “raise” he was offering would only apply to “a few hundred thousand” workers. If we assume that “few” to be 300,000 people, and that each of those people works a 40-hour week 50 weeks per year, that would mean that in the first year, when the incremental increase will be 95 cents/hour, each worker currently earning $7.25 per hour will earn an extra $1900, for a total gain by all the impacted workers of $570 million.

Just to give a sense of how little that $570 million is, it works out to just over one-third of the unit cost of one F-35 Joint Strike Fighter [1]. That’s the Pentagon’s latest new fighter jet, designed and built by Lockheed-Martin, the one that has no enemy to fight and that is probably too flawed and too costly to ever risk in battle anyhow.

What is really obscene about the president’s token wage-increase gesture is that the $10.10 wage that he is saying the federal government will ultimately pay to its contract workers in three years would, in constant dollars, still be less than what the federal minimum wage was back in 1968, almost half a century ago! Heck, if the president had really wanted to show the obstructive Republicans and the American people that he meant business about going it alone, he could have used that same executive authority to grant those impoverished workers an immediate raise to $15 per hour — the rate that voters approved as a minimum wage last November in Seattle, Washington, and that labor activists say would actually go a ways towards alleviating rampant US poverty.

Even worse is the reality that we wouldn’t even be talking about this pathetic offer, or about a current federal hourly wage of $7.25, if Obama, back in 2009, fresh off a huge election win and with Democratic Party control of both houses of Congress, had honored his campaign pledge to re-establish fairness in the National Labor Relations Act by passing “card check” legislation, making it possible for workers to unionize their workplaces by simply having a majority of workers sign cards saying they wanted a union. As things stand, and as the Obama the candidate denounced on the stump, employers are able to use the NLRA to delay union elections for years, during which time they typically engage in a campaign of lawless intimidation, illegally fire union organizers and end up defeating union drives, suffering no penalty afterwards (labor law limits employers found guilty of violations to having to pay back lost wages. There is no provision in the law to hit violators with penalties.)

Had Obama not reneged on his promise to the workers who voted him into office, dropping, right after his oath of office was taken, all efforts to reform the labor laws relating to union organizing, and had he instead, back when he had a Congress that, as a (then) popular new president he could have pressed for passage of the needed legislation, we would not today have only 11.3 percent of Americans in unions (and only 6.7% of workers in private-sector businesses!).

The reality is that even as the percentage of unionized American workers has continued to decline from over 30 percent in the 1950s to 11.8 percent in 2011 and 11.3 percent today, Bloomberg News reports [2] that the percentage of those workers who tell pollsters they would prefer to be in a union has continued to grow, with a majority of workers saying they would prefer to be working in a unionized workplace. In fact, the percentage of workers saying they would prefer to be unionized is higher than it has been since 1980. (As for those right-wing claims that unionized workers don’t like their unions, the same polling shows that 90 percent of union members would vote for their union if given the chance.)

Obama screwed his worker supporters from day one, when he decided to “delay” reforming the labor laws to make the unionization process fairer and illegal anti-union tactics by employers more difficult. Now he’s down to insulting them with his latest pathetic offer of a puny “raise” for the lowest paid federal contract employees.

Meanwhile, it is in his power to take another action which would, albeit indirectly, profoundly impact the wage and wealth gap currently afflicting this country. He could reverse his 2009 instructions to his lickspittle Attorney General Eric Holder not to criminally prosecute the executives of the giant financial corporations that robbed the American people and trashed the US economy, throwing it into what continues to be the greatest economic collapse since the Great Depression. Prosecuting the financial tycoon/crooks and clawing back their hundreds of billions of dollars in ill-gotten gains would not only dramatically level the wealth divide by hacking away the high incomes; it would also send a message to the whole corrupt capitalist class that ill-gotten gains would no longer be ignored.

Sadly, though, instead of prosecution of the criminal syndicate that is the banking industry, the Obama administration, when it has even bothered to prosecute larger institutions, has only levied fines on these companies — always without even requiring them to admit to guilt — fines that barely even dent the banks’ record profits, and that usually can be deducted from income, thus making them effectively subsidized by the very taxpayers who have been injured by the industries crimes.

The latest such outrage was the non-prosecution settlement reached by the Attorney General’s office with JPMorgan Chase, the nation’s largest bank. Under that settlement, JPMorgan Chase pays $20.5 billion in fines for its conscious and deliberate role in enabling the $65-billion ponzi scheme of Bernie Madoff, all of which was conducted through an account at JPMorgan Chase. There was no effort to prosecute JPMorgan Chase Chairman and CEO Jamie Dimon, who headed the bank through years of the entire Madoff scam, and AG Holder didn’t even insist, as he could have, that the bank dump Dimon as Chair and CEO. So Dimon continues in his role as head of the bank despite what has to be seen as either his complicity in an unprecedentedly huge criminal conspiracy, or his incomprehensively inept leadership.

And just to show how little the banking industry fears the Obama administration and its “Justice” Department, within less than two weeks of this outrageous “settlement,” the JPMorgan Chase Board of Directors voted to raise Dimon’s salary and bonus package by 75% to $20 million. No doubt the board members voting for this raise think Dimon earned the extra $8 million for keeping them all out of jail, along with himself.

It used to be that Democratic presidents would coddle and enrich the wealthy and powerful, while tossing crumbs to working people. Obama has taken this favor-the-rich tradition further. He openly serves the rich and powerful and then insults the intelligence of the working people who voted him into office.

Dave Lindorff is a founding member of ThisCantBeHappening!, an online newspaper collective, and is a contributor to Hopeless: Barack Obama and the Politics of Illusion (AK Press).




Obama Takes on Inequality

But Only the 99 Percent Need to Worry….
by ANDREW LEVINE, Counterpunch

 obama-inequality

Because the level of inequality in the United States is so extreme, because the condition of the “middle class” is deteriorating, and because there is so much need in the midst of plenty, increasing numbers of Americans are becoming troubled.

Inequality has been on the rise since the mid-1970s though, for a long time, few seemed to notice or care.  Evidently, we have now reached a tipping-point.

Hardly anyone blames the root cause, capitalism itself.  The idea that neoliberal globalization, the dominant factor in the current phase of capitalist development, is at fault is more widely appreciated.

But the opposition is still not pervasive or intense enough to turn back the bipartisan, neoliberal consensus that has afflicted our politics since the declining years of the Carter administration.

In short, inequality’s consequences are bemoaned; its causes, not so much.  But those consequences increasingly rankle.

With his administration’s antennae tuned to public opinion, and with both Democrats and Republicans getting the message, it was inevitable that Barack Obama would eventually jump on the anti-inequality bandwagon.

This is how it worked with “don’t ask, don’t tell,” and how it is now working with gay marriage.  Obama follows Benjamin Disraeli’s dictum: “I must follow the people,” Disraeli said, “am I not their leader?”

And so, in his State of the Union address, Obama called for a raise in the federal minimum wage, and announced that, by executive order, he would require government contractors to pay at least $10.10 — up from $7.25 — an hour.

If he stays true to form, there may be some legislative measures forthcoming in the next few months that he will do nothing to promote.  But unless Occupy Wall Street or something like it returns, that should be all we hear about inequality from the White House from now on.

Obama boosters are an abject lot, and now that we are five years into his tenure, their expectations are few.  His words Tuesday night will therefore probably satisfy their desire that he do something.  Obama has spoken; now there are only Republicans to blame.

But the boosters have been falling away since Day One, and Obama’s critics are becoming more acute.  It used to be mainly right-wing loonies with a racist tinge who had it in for Obama; their complaints were ludicrous.  By now, though, the scales have fallen from the eyes of many liberals and progressives; their complaints are spot on.

After his first few months in office, some Obama watchers pointed out how, whenever he does propose something out of the ordinary, he speaks grandiosely (though vaguely) and then lets events take their lobbyist-dictated, “bipartisan” course.

This was how we ended up with the Affordable Care Act, Obama’s “signature” legislative triumph.  It was a gift to the beneficiaries of our costly and inefficient system of health care provision, the insurance and pharmaceutical industries especially, confected by lobbyists and their bought and paid for legislators.

Of course, it also made health insurance available to some, though far from all, previously uninsured people.  This, his defenders assure us, vindicates Obama’s governing (or non-governing) style.

His latest State of the Union address deviated from the norm a tad: there was nothing grandiose, vague or otherwise, about what he called for.  Apparently, we are now living through Obama’s minimalist period.

However, there is another facet of Obama’s modus operandi that has been less widely noticed, but that was maximally in evidence Tuesday night.

Perhaps he learned it from the Israelis, observing how they have successfully blocked the establishment of a Palestinian state ever since they officially endorsed the concept in 1993.

The idea is to feign fidelity to the goal, repeatedly and in all apparent sincerity, while doing everything possible to assure that it will never come to pass.

Creating facts on the ground is key.  In occupied Palestine, this means establishing settlements on Palestinian land that no Israeli government would dare remove, even if it wanted to.

In Obama’s case, it means continuing state support for financial machinations from which only the super-rich benefit, and conferring de facto immunity from prosecution upon banksters and others whose greed leads them to exceed even what is technically legal under our current, greed-driven system.

It isn’t only Obama’s fault.  The entire political class is to blame – for rendering fair taxation policies unfeasible, and assuring that meaningful wealth confiscation and redistribution is out of the question.   So too are their media flacks.

Native Americans had a name for it, they called it speaking with a “forked tongue,” and they encountered it repeatedly in their dealings with Washington. The focus on inequality is novel, but the phenomenon is as old as Manifest Destiny itself.  In Obama, the spirit of the Great White Fathers lives on.

It is telling that when he berates inequality, Obama’s complaint has more to do with its economic consequences than its injustice.  And, even then, his indictment leaves the class-biases of his neoliberal economic commitments untouched.

The problem our political leaders acknowledge is that with unemployment and underemployment rampant and with real wages stagnant or in decline, not enough people have enough cash to keep the demand for goods and services high.

Up to a certain point, the few who own almost everything can benefit from this situation by outsourcing jobs and otherwise cutting labor costs.  They can then keep consumers happy enough to acquiesce by assuring ample supplies of cheap goods made abroad.

But this cannot go on forever.  In time, with the “middle class” in decline and poverty on the rise, even “malefactors of great wealth,” as we should take to calling them again, will have trouble enriching themselves further.

This is how matters currently stand.  Despite the best efforts of Wal-Mart and other low wage schlock emporia, the military, the Treasury and the Federal Reserve, there is just not enough money in consumers’ hands to sustain even obscenely unbalanced growth.

For the one percent to continue accumulating riches at the levels to which they have become accustomed, Third World labor, military spending, and paper wealth, unrelated to the real economy, are not enough; domestic consumer markets need a boost.

On the right – or righter – side of the political spectrum, the inclination is to blame the victim; to trot out the old “culture of poverty” arguments again.

However this time around, even many Republicans understand, as best they can, that the ambient political economy helps shape and sustain the cultural disabilities they decry.

Whether they realize it or not, they therefore implant themselves on the terrain Obama staked out in his State of the Union message.   It had to happen someday; Democrats have been implanting themselves on Republican terrain for decades.

Therefore the question for everyone – except perhaps Ayn Rand followers and other doctrinaire libertarians – is what should the government do?

This is not quite the same as asking what will the government do?  We know the answer to that: with Obama in charge, it won’t do much of anything – once the words are spoken and the gestures made.

In the past, in many instances, Obama’s words and gestures, if followed up with action, might indeed have led to substantive changes.  Some of them might even have been changes for the better.

This time around, however, his words and gestures are void of substance.  Therefore, when he goes on to do not much of anything by way of follow up, little, if anything, will be lost.

Tuesday night’s histrionics notwithstanding, this is plain from even a cursory reflection on what equality involves — conceptually and historically.

*                                              *

The religious and philosophical traditions that shaped the thinking of the first proponents of equality some four centuries ago upheld the idea that persons are equal – in ways that matter theologically or philosophically.   But these traditions were not taken to imply that political, social or economic institutions should treat persons equally.

For example, the medieval Church held that lords and serfs harbor souls that God loves equally.  But no one took this to imply anything about equal treatment for lords and serfs.

Indeed, the predominant view was that it would be “unnatural” and therefore wrong or contrary to God’s will were members of different social classes treated the same way.

This conviction began to weaken as traditional social solidarities gave way to instrumental social relations based on market mechanisms, and as popular aspirations came to be articulated in terms of fundamental “rights.”

By the time of the French and American Revolutions, the idea that persons living in the same political communities are all equal as citizens – in other words, that basic legal and political rights should be distributed equally – was widely endorsed in enlightened circles on both sides of the Atlantic.  In due course, the whole world followed suit.

But what was proclaimed in theory was – and still is – often denied in practice.

In the United States early on, only free white men had full legal rights; indeed, many Americans were slaves.  And it took almost two centuries for all citizens – regardless of wealth, gender or race – to gain full voting rights.

Remarkably, even that achievement is now under attack as Republicans, seeking electoral advantage, invoke the possibility of electoral fraud as a pretext for suppressing voter turnout in communities, mostly poor or of color, where Democrats have an advantage.

In the United States today, the unequal distribution of political rights is pervasive and systemic.  Indeed, there has probably has never been a time when there has been less equality of political influence even for those who are able to vote without impediment.  This is because unequal wealth has spilled over into unequal political rights to an unprecedented extent.

For this, the Supreme Court is partly to blame.  Over the past several decades, but especially in recent years, it has effectively recast political corruption – the buying and selling of political influence – as Constitutionally protected free speech.

“Equal justice under law” is inscribed on the Supreme Court building, but in the United States today, that is more an illusion than a reality.

Unequal justice is one of the many ways that racism survives in our basic institutional arrangements.   It also plays a role in government efforts to preserve the status quo at home and abroad.

The Obama-Holder Justice Department has been especially intent on protecting Bush-Obama era war criminals, and banksters who have robbed the American people egregiously.

It is emblematic of the situation Obama superintends that his chief spy-master, James Clapper, Director of National Intelligence, has gotten off scot-free after lying to Congress, and that he prances about denouncing Edward Snowden for shining light on the Bush-Obama war on privacy, due process and freedom of expression.  To that end, this Obama-supported defender of the American way has even gone so far as to threaten journalists who utilize the information Snowden has provided.

The situation is more or less the same everywhere.  No significant strain of public opinion favors unequal legal and political rights.  Political equality is universally endorsed.  But, in the real world of politics, it is seldom perfectly realized or even approximated; sometimes, it is deliberately denied.

The great revolutions of the eighteenth century that sealed feudalism’s demise established a distinct, but related, conception of equality: equality of opportunity.

Like the idea of political equality, notions of equal opportunity are honored more in the theory than the observance.   The difference is that in this case there is not just hypocrisy and denial, but also contestation over what the idea means.

For some, equal opportunity is achieved when legal or customary impediments are removed so that in principle everyone competes for scarce but desired benefits on equal terms.  Equal opportunity in this sense — the idea that careers be open to talents, as they said in revolutionary France, — is therefore tantamount to political equality.  It collapses differences inherent in class societies into the universality of citizens’ rights.

For others, there is equal opportunity only when state or societal institutions correct for all the factors that impede individuals’ competitive prospects – in other words, when the playing field is level.

Needless to say, it would be difficult, if not impossible, at the societal level, to assure that all individuals compete on equal terms.  But the practical problems become tractable when the idea is only to correct for disadvantages that individuals face as members of systematically disadvantaged groups.

Women comprise such a group, as do racial, ethnic and religious minorities, along with other involuntary collections of individuals that suffer from discrimination.

Then, for those who would equalize opportunities in this sense, the idea is to compensate for disadvantages through “affirmative actions” that accord priorities in competitions to individuals from disadvantaged groups.

To do this thoroughly, it would be necessary to start at birth if not before.  But that would conflict with the idea that, whenever possible, children should be reared in families; something no one seriously proposes.   Affirmative interventions therefore always come too late.

Political equality is different; that ideal can be realized perfectly without violating any core values.  Equality of opportunity can only be approximated with varying degrees of success.  Realizing that ideal perfectly is generally beyond the means societies can employ.

However directing public expenditures in ways that benefit the poor more than the rich, along with vigorous affirmative action programs, can significantly ameliorate situations in which substantive, not just formal, opportunities are unequally distributed.

In principle, though, there could be little, if any, need for amelioration.  All that is required for that would be an equal, or nearly equal, distribution of income and wealth.

Were there substantially more wealth and income equality than there currently is, and were basic legal and political rights also distributed equally and to the greatest possible extent, there would be no need to equalize opportunities.  Equal opportunity would follow automatically.

In philosophical circles, a great deal of attention has been paid in recent decades to ascertaining precisely what economic equality involves, especially in situations where production, trade, and luck are taken into account.

The question is more complicated than might at first appear.  But, for practical policy purposes, whatever the precise goal is thought to be, the best – indeed, often the only feasible – way to approximate it is by distributing income and wealth as equally as possible.

Is that what Obama has in mind?  Not by a long shot.  The measures broached in his State of the Union message fall preposterously short of anything even remotely sufficient for advancing equality in this sense – or indeed in any other.

Raising the minimum wage to $10.10 per hour, roughly what it was in 1968 (taking inflation into account), and continuing unemployment benefits for the long-term unemployed, as any minimally decent society would, can help a little to slow down rising inequality.  But these proposals hardly begin to address egalitarian concerns.

Obama could have done better, much better, just by resuming policies that were widely accepted – indeed, taken for granted – by both Republicans and Democrats just a few years ago.

He might, for example, have declared that he would enforce existing laws that enable union organizing and that he would work for passage of the Employee Free Choice Act, as he promised repeatedly when he was running for office.

If there is a clear lesson for egalitarians from the mass of evidence that has been accumulating for at least the past century and a half, it is that, in capitalist societies, nothing is more efficacious and beneficial than a strong, independent labor movement.

That is hardly news – except perhaps in national Democratic Party circles and in the White House.

Or instead of asking for fast track authority to negotiate the Trans-Pacific Partnership Agreement, a trade measure certain to have more devastating consequences for working people even than the North American Free Trade Agreement, NAFTA, he could have forborn from making the already bad situation confected during the Clinton years worse.

For sheer disingenuousness, Obama railing against increasing inequality while advancing neoliberal trade policies rivals Binyamin Netanyahu’s declarations of support for a Palestinian state while establishing new Jewish settlements in the Occupied Territories.

Then there is education policy.  In the Bush-Obama era, the talk is about “the American dream,” not about, as Eugene Debs put it, rising with your class, not rising out of it.

 

But Bush’s and Obama’s education policies are only incidentally about bringing a few children from poor families into the so-called middle class.  They are about training the workers capitalist firms need; a goal that can be, and typically is, in tension with even with such pale, old-fashioned egalitarian ideas as using schools to create democratic citizens.

Today’s leaders know how to do that, or ought to know, because it is what their predecessors did.  They ought to know too that teaching to tests and introducing other corporate-friendly measures of “performance” is unhelpful at best, and that underfunding public education, and attacking educators and their unions, is not the way to proceed.

This used to be widely understood.  But in the Age of Obama, obvious, decent, and tried and true methods that even hint at the prospect of raising revenues by raising taxes, especially taxes on the rich, only invite derision.   They also displease the paymasters of the Democratic and Republican Parties.

Because our President knows this well, the level of caution he displayed in his State of the Union address was stupefying.   He threw out only one sop: an old proposal for pre-school programs for four-year olds.

Will he do anything about even that?  Don’t hold your breath.  In all likelihood, we have already seen all the action there will be.

And then there is poverty.  Forget about LBJ’s War against it five decades ago; Obama didn’t even mention the problem Tuesday night.  Going back to Great Society minimum wage levels is about as far as he is willing to go.

Who knows – or cares – what Obama really wants; the one-percent is calling the shots.  How could they not?  They own most of what there is to own, the political class most of all.

To their credit, Republicans just are what they are: useful idiots of the super-rich.  Guile and dissimulation are beyond their reach.  With Democrats, there is more of a gap between appearance and reality.

With Obama, the gap was once exceptionally wide.  Those days are long gone.  But the man is nothing if not clever, and Netanyahu has taught him well.  And so, as he inveighs against inequality, he goes on establishing facts on the ground.

The super-rich therefore need not worry that, under Obama’s leadership, less inequality is coming.  Insofar as the President has anything to do with it, there will be more, not less, for them.

Obama’s forked tongue has spoken, taking inequality on.  But only the ninety-nine percent need worry.

ANDREW LEVINE is a Senior Scholar at the Institute for Policy Studies, the author most recently of THE AMERICAN IDEOLOGY (Routledge) and POLITICAL KEY WORDS (Blackwell) as well as of many other books and articles in political philosophy. His most recent book is In Bad Faith: What’s Wrong With the Opium of the People. He was a Professor (philosophy) at the University of Wisconsin-Madison and a Research Professor (philosophy) at the University of Maryland-College Park.  He is a contributor to Hopeless: Barack Obama and the Politics of Illusion (AK Press).




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American State of the Union: A Festival of Lies

Obama: One of the slickest liars in history. Perfect for a system based on deceptions.

Obama: One of the slickest liars in the history of the American republic. Perfect for a system based on deceptions.

Before the nation and the world, President Obama pledges to take “action” against “economic inequality,” while simultaneously holding secret negotiations on a Trans Pacific Partnership trade scheme that will quicken the pace of the global Race to the Bottom, deepening economic inequalities. “Lies of omission are even more despicable than the overt variety, because they hide.”

American State of the Union: A Festival of Lies

by BAR executive editor Glen Ford

When you say ‘jobs,’ he says tax cuts – just like the Republicans, only Obama first cites the pain of the unemployed, so that you know he cares.”

“Believe it,” said the current Prevaricator-in-Chief, in the conclusion to his annual [7] litany of lies. President Obama’s specialty, honed to theatrical near-perfection over five disastrous years, is in crafting the sympathetic lie, designed to suspend disbelief among those targeted for oblivion, through displays of empathy for the victims. In contrast to the aggressive insults and bluster employed by Republican political actors, whose goal is to incite racist passions against the Other, the sympathetic Democratic liar disarms those who are about to be sacrificed by pretending to feel their pain.

Barack Obama, who has presided over the sharpest increases in economic inequality in U.S. history, adopts the persona of public advocate, reciting wrongs inflicted by unseen and unknown forces that have “deepened” the gap between the rich and the rest of us and “stalled” upward mobility. Having spent half a decade stuffing tens of trillions of dollars into the accounts of an ever shrinking gaggle of financial capitalists, Obama declares this to be “a year of action” in the opposite direction. “Believe it.” And if you do believe it, then crown him the Most Effective Liar of the young century.

Lies of omission are even more despicable than the overt variety, because they hide. The potentially most devastating Obama contribution to economic inequality is being crafted in secret by hundreds of corporate lobbyists and lawyers and their revolving-door counterparts in government. The Trans Pacific Partnership (TPP) trade deal, described as “NAFTA on steroids,” would accelerate the global Race to the Bottom that has made a wasteland of American manufacturing, plunging the working class into levels of poverty and insecurity without parallel in most people’s lifetimes, and totally eviscerating the meager gains of three generations of African Americans. Yet, the closest Obama came to even an oblique allusion to his great crime-in-the-making, was to announce that “new trade partnerships with Europe and the Asia-Pacific will help [small businesses] create even more jobs. We need to work together on tools like bipartisan trade promotion authority to protect our workers, protect our environment and open new markets to new goods stamped ‘Made in the USA.’” Like NAFTA twenty years ago – only far bigger and more diabolically destructive – TPP will have the opposite effect, destroying millions more jobs and further deepening worker insecurity. The Trans Pacific Partnership expands the legal basis for global economic inequalities – which is why the negotiations are secret, and why the treaty’s name could not be spoken in the State of the Union address. It is a lie of omission of global proportions. Give Obama his crown.

The Trans Pacific Partnership (TPP) trade deal, described as ‘NAFTA on steroids,’ would accelerate the global Race to the Bottom.”

The president who promised in his 2008 campaign to support a hike in the minimum wage to $9.50 by 2011, and then did nothing at all to make it happen, says this is the “year of action” when he’ll move heaven and earth to get a $10.10 minimum. He will start, Obama told the Congress and the nation, by issuing “an executive order requiring federal contractors to pay their federally-funded employees a fair wage of at least $10.10 an hour because if you cook our troops’ meals or wash their dishes, you should not have to live in poverty.” Obama neglected to mention that only new hires – a small fraction, beginning with zero, of the two million federal contract workers – will get the wage boost; a huge and conscious lie of omission. The fact that the president does not even propose a gradual, mandated increase for the rest of the two million shows he has no intention of using his full powers to ameliorate taxpayer-financed poverty. We can also expect Obama to issue waivers to every firm that claims a hardship, as is always his practice.

What is Obama’s jobs program? It is the same as laid out at last year’s State of the Union, and elaborated on last summer: lower business taxes and higher business subsidies. When you say “jobs,” he says tax cuts – just like the Republicans, only Obama first cites the pain of the unemployed, so that you know he cares. “Both Democrats and Republicans have argued that our tax code is riddled with wasteful, complicated loopholes that punish businesses investing here, and reward companies that keep profits abroad. Let’s flip that equation. Let’s work together to close those loopholes, end those incentives to ship jobs overseas, and lower tax rates for businesses that create jobs right here at home.” Actually, Obama wants to lower tax rates for all corporations to 28 percent, from 35 percent, as part of his ongoing quest for a Grand Bargain [8] with Republicans. For Obama, the way to bring jobs back to the U.S. is to make American taxes and wages more “competitive” in the “global marketplace” – the Race to the Bottom.

In the final analysis, the sympathetic corporate Democrat and the arrogant corporate Republican offer only small variations on the same menu: ever increasing austerity. Obama bragged about reducing the deficit, never acknowledging that this has been accomplished on the backs of the poor, contributing mightily to economic inequality and social insecurity.

Obama offers nothing of substance, because he is not authorized by his corporate masters to do so. He takes his general orders from the same people as do the Republicans. That’s why Obama only speaks of minimum wage hikes while Republicans are in power, rather than when his own party controlled both houses of Congress. Grand Bargains are preferred, because they are the result of consensus between the two corporate parties. In effect, the Grand Bargain is the distilled political will of Wall Street, which feeds the donkey and the elephant. Wall Street – the 1 percent – believes the world is theirs for the taking, and they want all of it. Given this overarching truth, Obama has no choice but to stage a festival of lies.

BAR executive editor Glen Ford can be contacted at Glen.Ford@BlackAgendaReport.com [9]


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