Good Evening Friends,

Another way the bourgeoisie tries to expand and go past the natural limits of capital, is to engage in "branding." Let's get into that, but first, this:

Keep in mind the quote I gave you from The Communist Manifesto, about how the Old Money aristocracy had been reduced, by historical circumstances, to a critical, literary role of the emerging bourgeoisie. Remember that? Remember how I said that Old Money always wags its finger at New Money, at their newfangled ways. The former criticizes the different methods of exploitation used by the latter - different than the ones the former had used in different historical circumstances.

Here's what Naomi Klein wrote: "Indeed, a little side industry has developed of CEOs falling over each other to proclaim themselves ethical clairvoyants: they write books about the new "stockholder society," publicly berate their peers at luncheon addresses for their lack of scruples and announce that the time has come for corporate leaders to address the growing economic disparities. Trouble is, they can't agree on who is going to go first" (1).

These visionary CEOs, secure in the wealth and position, have now become Old Money in the individual sense. They can now afford to become the wise heads. Oftentimes, they get jobs in government.

What is branding? Naomi Klein says that, again, starting in the eighties, corporations made the strategic decision to get out of the stuff making business and get into the image making business. Others could handle the boorish drudgery of actually making the underlying thing, which becomes the talisman of the lifestyle the company is really selling. Outsourcing is involved, but of a different kind. But we'll come back to that.

Here's the kernel of Nike's appeal to disadvantages youths of the inner city.

"By supporting sports programs in Boys and Girls Clubs, by paying to repare urban basketball courts and by turning high-performance sports gear into street fashions, the company claims it is sending out the inspirational message that even poor kids can "Just Do it." In its press material and ads, there is an almost messianic quality to Nike's portrayal of its role in the inner cities: troubled kids will have higher self-esteem, fewer unwanted pregnancies and more ambition - all because at Nike "We see them as athletes." For Nike, its $150 Air Jordans are not a shoe but a kind of talisman with which poor kids can run out of the ghetto and better their lives. Nike's magic slippers will help them fly - just as they made Michael Jordan fly" (2).

That's it. That's what branding is all about. It is, of course, another form of virtual capitalism, that is triggered when the system comes up against its natural limits to expansion.

After all, what more can be done to a pair of sneakers to improve them and differentiate them from another pair of sneakers, at this point? Apparently, not much.

And yet, you have to go on selling sneakers. You have to keep competing agains the other guy to sell more sneakers than he does. You have to keep on keepin' on, to try to get more "market share," than the other guy. You have to keep on until you are the dominant player in the industry, or one of the two, three, four, or five monopolies (though we don't use that word in polite society) left standing, and so on and so forth.

You have to resort to advertising, to desperately try to persuade people that x brand sneakers are infinitely more desirable and cooler than y brand of sneakers. When this exhausts itself the next move is to try to grow your way to dominance, buying out as many as your competitors as possible.

I'll go on with this tomorrow.

wingedcentaur

Good Morning Friends,

Another way that New Money bourgeoisie tries to transcend the natural limits of capital expansion is to engage in hyper-growth, mergers, acquisitions, leveraged buy outs, and "hostile takeovers," and the like. One of the things we learned from this financial crisis is that "too big to fail," acted as a kind of insurance policy. Recall that analysis of Kevin Phillips we have been discussing, about the strategic decision of elements of the U.S. government, in the eighties, about backing finance to the hilt, over every single other sector of the economy, a policy of periodically bailing out "overextended financial institutions."

The CEOs and top executives of certain hysterically monopolizing entities, must have breathed a sigh of relief when, according to their judgment, their corporations had reached a certain level of inevitability. The state itself cannot allow them to fail because of their infinite interconnectivity. Remember, deep down, greed always comes from fear.

In 1919 eighty-nine mergers involved 527 "concerns". In 1928, two-hundred-one mergers "repackaged" 1,259 businesses. "So many family businesses were pulled into the corporate orbit that nearly 20 percent of U.S. national wealth shifted from private to corporate hands. The corporate share of national wealth rose to about 30 percent, and largest 100 corporations came to command about half of the total U.S. industrial net income. Holding companies were another highlight of twenties restructuring (1)."

According to the New York Stock Exchange, of the 573 companies whose stock was traded actively in 1928, 395 were both holding and operating companies, and 92 did nothing but hold other companies securities. "Paper entrepreneurialism" (2).

And, of course, this current crisis has made us all aware of the 1999 Financial Services Modernization Act, which overturned Glass-Steagal of the New Deal era, which prohibited commercial banks and investment banks from fusing. And well before this, we were aware of the intense concentration of media ownership, for example, and so on an so forth.

One of the things, I think trigger mergermania, is the inherent lack of qualitative improvability and differentiation potential in most everything we buy and sell. Because this is so, advertising comes into prominence, becomes vital in fact. But I'll talk about this another time.

Yet another way New Money bourgeoisie tries to overcome the limits of capital, is through financializing productive industrial concerns.

"American Can Company turned itself into a financial services firm called Primerica, which several incarnations later merged with Citicorp. General Electric sold off its consumer appliance division, emphasizing huge financial profits of its General Electric Credit Corporation. By 2000 GE credit banks were as far afied as the Czech Republic (3)."

"Ford Motor Company came to rely on high profits from a subsidiary, Ford Credit Corporation heavily involved in global hedging" (4).

As, "[m]aking things became unfashionable, as Wall Street Journal reported in a November 1999 front page article. Enron, the Houston-based energy firm, financialized itself into a company that traded energy like stock options, becoming more akin to Goldman Sachs than to consolidated Edison" (5).

Now, these mergers, restructurings, and internal transformations cause lots of working people to lose their jobs. Again, Kevin Phillips wrote: "Pressure to maximize profits and stock prices by cutting employees came from both the top managment and from Wall Street and institutional investors, the latter responding to yardsticks that a single layoff added $60,000 to future year bottom line earnings. If layoffs and downsizings continued even as profits set records in the nineties, that was because the layoffs and downsizings were often the reason for the profits" (6).

I think what this analysis reveals is that there is a decidedly bulimic tendency in American corporate capitalism. Just as physical bulimia is considered unhealthy to gorge oneself and then throw up immediately - because, for one thing, the acid that is in the stomach and is meant to remain in the stomach to aid digestion, is brought up and wears at the lining in the lungs and the throat and the inside of the mouth, and what-have-you - it is similarly unhealthy to practice corporate bulimia.

The "binge" comes with the latest "bubble" (Internet, asset, housing, railroads, etc.). The "purge" comes when the bubble eventually pops. Then comes the downsizing, "right-sizings," that leave in their wake, tens of thousands upon tens of thousands upon tens of thousands on the unemployment line and more fearful for their jobs. Not only that, but as you know, those workers remaining at their posts have to work harder to pick up the slack - and you create a social order that breeds disloyalty on the part of employers, certainly, but also workers - which we may touch on very, very briefly (or not depending on time).

1) Phillips, Kevin. Wealth and Democracy. p.61

2) ibid

3) Phillips, p.143

4) ibid

5) ibid., pp.143-144

6) Phillips, p.150

Alright, next time we'll very briefly discuss another method of virtual capitalism: branding.

wingedcentaur

Good Evening Friends,

Before continuing, let me take issue with one observation made by Kevin Phillips. In his Wealth and Democracy, he wrote: "Class warfare, however, is a false description, a perverse conservative borrowing from Karl Marx. In the United States, the pro-wealth policies of the right have enjoyed substantial low and low-middle-income support, particularly among religious voters enlisted by the cultural facets of conservatism (1)."

He's saying, here, that a class analysis does not work, because low and low middle income folks, at least, did not perceive themselves to be at "war" with the bourgeoisie, since their policies enojoyed support from sections of the proletariat - therefore it is impossible to say that the financial oligarchy are or have been consciously working against the interests of the rest of us.

First of all, let me cede a point to Mr. Phillips. I stipulate that, indeed, pro-wealth policies of the right have enjoyed "substantial low and low middle income support." I know this is so from directly related anecdotal evidence. Phillips says this is especially so "among religious voters enlisted by cultural facets of conservatism."

This sounds like a description of the so-called "prosperity gospel," the interdenominational pro-wealth doctrine of evangelical Christianity. In fact, I would refer you to Sarah Posner's excellent book on the subject, God's Profits; as well as an article in the December 2009 issue of The Atlantic, "Did Christianity Cause the Crash," by Hanna Rosin.

But these two facts do not defeat a class analysis of the economic situation. In fact, they strengthen it. The first thing to remember that the behavior of any class, as a whole, is never monolithic. And as for the second thing, please consider the following. What if President Ronald Reagan had thought of himself as a Republican Prometheus? Prometheus, of course, was the Greek god who gave man fire, against the wishes of most of the other Olympians, and was punished for it by Zeus.

A couple of things to keep in mind. Stay with me, but both Ronald Reagan and George W. Bush - who seemed to think of himself as more the political heir to Reagan than his own father - were both criticized by "movement conservatives" [the Conservative Party proper, which is not necessarily synonymous with the Republican Party] for the dramatic growth in the size of the federal government that occurred under their regimes. Ronald Reagan and George W. Bush have both been called "big government liberals" by conservatives.

If Ronald Reagan - and George W. Bush - are the Prometheus character, then we can think of critical conservatives as the majority of the disapproving Olympian pantheon.

Moreover, we must remember that George W. Bush did not run, in 2000, on a platform of hardcore conservative austerity. His Republican campaign for the presidency did not say, poor and downtrodden, be damned! He proposed a different way to deliver social services to "low and low-middle-income" folk, through the agency of "faith-based initiatives."

Now, back to Reagan. For those of you old enough to remember, let me ask you: What did Ronald Reagan mean "supply side" economics, and how did he conceive of the prosperity "trickle down" to the rest of society, especially those most in need of relief? I hope you will stipulate that there was probably a difference between the vision of Ronald Reagan and that of the technocrats that surrounded him.

Forgive me for mixing my metaphors, but have you ever seen Lord of the Rings? Beware the ring of Sauron! Sauron is the evil sorcerer supreme terrorizing "Middle Earth." Sauron made a ring which contained a portion of his power. He lost the ring, it had been cut from his hand in battle long ago. The ring fell into the hands of the good guys.

The sides of good and evil were going to have it out on the battlefield, once and for all, and so forth. But the hobbit, Frodo (the custodian of the ring after his uncle, Bilbo guarded it) and the team assembled around him, had the task of taking the foul thing to a certain volcano and dropping the trinket into it thus "unmaking" it. Gandalf, the wizard and one of the heroes, and naturally an authority on all things magical and enchanted and so forth, is absolutely clear and unequivocal about the necessity of this. "You cannot wield it," Gandalf says.

Fantasy literature is full of scenarios like this. You have a god or sorcerer or somekind of enchanted cosmic of other dimensional being of some sort, who creates a jewel or ornament of some kind which contains a very tiny portion of his power. And then he loses it! And an individual from a lower evolutionary order finds it. These tales never, ever, ever end well for the mortal who finds this ornament, whatever it might be. Recall the insanity of the homicidal Golem!

There was a difference of opinion within Frodo's team about the ring of Sauron. Some agreed with Gandalf, that the ring had to be destroyed and that there was no other way. Some thought that the good guys could use Sauron's ring against him, against all evil in Middle Earth.

So, when Mr. Phillips speaks of "substantial low and low-middle-income support," we have a disagreement among the proletariat about whether or not the Ring of Sauron (instruments of credit/debt) can be used against evil (poverty/the decreasing ability of the working class and poor to consume).

I agree with Gandalf. You cannot use Sauron's ring against him. Its probable that as soon as the ring comes anywhere near Sauron's person, the ring would fly off your hand, of its own accord, and onto the hand of the dark lord, Sauron.

Similarly, I am of the opinion that the instruments of credit/debt (Ring of Sauron) cannot be used against evil (poverty and/or the decreasing ability of the working class and the poor to consume). Credit - the need for it to maintain consumption - is the creature or ornament of poverty. Credit (this form of it and by extension, all exotic financial instruments) is poverty's own!

Let's return to the analysis of Dr. Rick Wolf, the Marxist professor of economics. Recall how he told us that from 1820 to 1970, real wages for workers as well as profits for the capitalists rose without fail every decade, as the productivity of the American worker continued to go up and up.

Then in the mid-seventies all of this stopped. The profitability of capitalism hit a wall, to which they responded by holding wages of workers flat, in relation to inflation. Wages have remained flat and decreased slightly, in relation to prices, since the late seventies - even, by the way, as the productivity of the American worker continued to increase unfailingly up to the present moment you are reading this.

Now, the American industrialists flattened wages by various means, which we do not need to go into here. They did it, is the point. This flattening of wages combined with steadily increasing worker productivity, produced intoxicatingly staggering profits for American industrialists. But this windfall was exponentially amplified for them, when they came up with the bright idea to offer the money - that workers should have been getting as wages - to them as loan, which they had to pay back with interest.

So, you cannot fight poverty or the decreasing ability to consume, which comes from stagnant wages with credit. Because without the ability to earn a living wage, where will the money come from to pay off the debt? You take out another line of credit, don't you? You open another credit card, and another, and another.... and so on and so forth, in addition to other means the working class found to maintain consumption.

But wait, there's more. We're not quite finished yet. You know, those Ring of Sauron-type stories never end well for the mortals, for the very simple reason that normal human beings do not have the intrinsic immortality or inviolability which might shield us from blowback, in case anything goes wrong with the powerful dark forces we try to control. Hold that thought.

Now I'm going to engage in an incomplete speculation. I have wondering if there was a connection between the deregulation of finance at the top of society, the federal government and the lower order magic made available to "low and low-middle-income" people. I'm talking about those infomercials about selling real estate with no money down, buying and selling... items that some warehouse will send you, placing ads in various venues, making money through the Internet, in one way or another, and so on and so forth.

The danger, from a Lord of the Ring point of view, is not that these programs don't work or are a hoax. Quite the contrary, the danger is that these approaches actually work!

However, just as it is never safe for mortals to manipulate the power objects of greater beings, it is not a good idea for "low and low-middle-income" people to manipulate the financial power objects of "greater beings," because the former do not have the political and legal armor to protect them from blowback, that is available to the latter. If the former make a mistake or misstep or try to do something that there is any legal question about, they could end up fined into bankruptcy, put in jail, or both. But Tim Geithner can apologize to the senate for not paying his taxes, and instead of suffering any penalty we, the public, heard anything about, he gets to go on to become Treasury Secretary of the United States.

So there is disagreement in the company of Frodo about the desirability of using the ring of Sauron. But what if Reagan - one of many who gave us the ring of Sauron - saw himself as giving us the gift of fire. Sauron was at war with all the folk of Middle Earth, who were not aligned with him, despite the fact that they had different opinions about how to fight the dark overlord: to use the ring or not to use it.

What if George W. Bush had a similar vision? What if the thought this could become an "ownership" through deregulated finance and privatization (of Social Security, for example, turning into interest-bearing private investment accounts; and suppose he, George W. Bush, never wanted to "destroy" or even reduce government, as much as make it portable?) could just about give all Americans a relatively, universal luxurious standard of living, with the only ones being left out - temporarily - being the undocumented workers from Mexico - that is, until they, themselves, became citizens (remember Bush was for a "guest worker" program, and so forth), and then the cycle would start again.......?

Let me close with this. Again, Kevin Phillips wrote: "Part of what Bad Money deals with that I have not touched on before is the financial sector's massive use of private debt and leverage during the 1990s and then again in the first decade of the twenty-first century to expand its size, global reach, and extraordinary profitability. This is less a market-based Adam Smith brand of triumph than a mercantilist joint venture with U.S. government authority, strategic direction, funding support, and periodic Federal Reserve or U.S. Treasury bailouts of overextended financial institutions. This is certainly in keeping with the mercantilist flavor of policies gaining traction elsewhere in the world. Some have labeled these apparent policies the '"socialization of risk"' or '"Wall Street socialism."' I think a better explanation is that elements of the U.S. government decided, back in the 1980s, that finance, not manufacturing or even high technology, had to be the sector on which Washington would place its strategic chips - would '"pick as a winner"' in the parlance of the era. Farms and factories were expendable, but certain banks and other financial institutions could not be allowed to fail" (2).

Now, these words were published in 2008 and the first quote comes from 2002. I could almost wonder if Phillips has had a change of heart, somewhat, on the question of class, except that he does not accept the idea of "socialization of risk," or "Wall Street socialism." He cites mercantilism from a national perspective. What about class mercantilism? What is "periodic Federal Reserve or U.S. Treasury bailouts of overextended financial institutions" but "socialization of risk" by definition?

He says that he thinks elements of the U.S. government, back in the eighties, made a strategic decision to "pick [finance] as a winner" over every sector of the economy. Let me say, that as far as I am aware, all "warfare" is full of strategic decisions and considerations. One cannot help the vast difference in the way that both the George W. Bush and Barack H. Obama administrations, dealt with the tailspinning finance sector and the automotive industry.

It looked to most of us that when Wall Street needed help, they got it, no questions asked. The Federal Reserve chairman, Ben Bernanke, didn't even want to reveal the names of the overseas institutions that got the bailout money, that went to AIG, that had to financial institutions that had bet correctly on sub prime mortgages, and the like. I can't even pretend to understand all of it. The banks got trillions (I heard that quantity one trillion is literally one hundred times the age of the universe) with no strings attached, as it were.

But as for the big three auto companies. Congress and the president kept asking these corporations for credible restructuring plans before they would get any money. Obama kept giving them deadlines to present credible plans and insisted on the removal of one of the auto company CEOs. And so on and so forth. These companies, like Pahlovian dogs, kept cutting jobs and forcing unions to do "give backs," of benefits and so forth. By the way, this brings up the issue of Wall Street bonuses.

The AIG matter actually provoked some outrage in Congress, of all places. Charles Schumer, the senator from New York said that if the executives didn't do the right thing and give back those bonuses, the Congress would pass legislation to "tax virtually all of it." Remember that?

But the usual route regarding Wall Street bonuses, was that the United States is a country of laws and that contracts are sancrosanct. But, of course, this was not the case with the contracts of auto workers.

Now, again, Phillips says that the strategic decision of elements of the U.S. government - going back to the eighties - was that farms and factories were to be considered "expendable," while "certain banks and other financial institutions could not be allowed to fail." Different "classes" of the population work in farms and factories and banks and financial institutions.

So, are the bourgeoisie waging class war against the rest of us? Are they doing it deliberately, consciously as a group? I would answer the first, yes. The second is more complicated. Some probably have a quite self-conscious antagonism toward the "unwashed masses," others act on a more unconscious level. Organizational behavior can be thought of as a train, leaving one station and heading for another. Along the way, people get off and get on at different points, or what we might call points of access. But the train is ultimately headed for the last stop, the station at the endpoint of the route. I'll leave it there for now.

1) Phillips, Kevin. Wealth and Democracy: A Political History of the American Rich. Broadway Books. New York, 2002. p.xiii

2) Phillips, Kevin. Bad Money: Reckless Finance, Failed Politics, and The Global Crisis of American Capitalism. Viking (Penguin Group), New York, 2008.

wingedcentaur

Good Evening Friends,

In all of this, please remember that we are talking about capitalism. Neoliberalism is just a historically opportunistic, hyper-aggressive approach to capitalism. Capitalism can never be permanently reformed or regulated, because when this happens, the capitalists feel their profits pinched, and they look for ways to evade, subvert, or destroy regulation.

When capitalism runs into its natural, physical and ideological barriers to growth, this system tends to trigger, both what I like to think of as virtual capitalism (1), and what Naomi Klein calls disaster capitalism (2).

And it is a fusion of elements of both virtual and disaster capitalism which comprise what we might think of as neoliberalism. Remember, neoliberalism - a creation of the seventies and eighties - is the exact equivalent of the capitalism of the pre-New Deal era. But I want to take a look at a tiny aspect of virtual capitalism, here.

Neoliberalism is very concerned about intellectual property rights, excessively so, as we shall see in a moment.

I would refer you to an excellent documentary called Enron: The Smartest Guys in the Room. This, of course, is available to view online in its entirety. Just type in the title in the search bar and you will be taken right there.

The CEO was a man called Jeffrey Skilling, Harvard whiz kid, just the kind of big thinking visionary Ken Lay had been looking for.

Now, one of the on-camera consultants for the documentary was a woman called Bethany McClean, co-author of the book, The Smartest Guys in the Room. She said that one of Skilling's conditions for taking the job, was that he be allowed to use mark-to-market accounting. Arthur Andersen "signed off on it," and "the SEC approved it."

Mark-to-market accounting allowed one to "book" the anticipated, future profits the moment a deal was signed, no matter how little money initially came in the door, as it were. These anticipated profits were written as actual, received profit. Bethany McClean said that Jeffrey Skilling believed that the idea was everything; and that one should be able to book the profits from that idea, right away; otherwise some "lesser" man could come along and profit from an idea that some "greater" man had come up with in the past.

This pre-booking of the hypothetical profits, was converted by the "free market," into very real profit, of course.

For one tiny example, according to the documentary, Enron had built a power plant in India, at a time when nobody else would do that. The risk was considered too great. India hadn't the money to pay for the power the plant produced. Enron lost a billion dollars on the project.

Even so, Enron paid its executives millions in bonuses, based on imaginary profits that, of course, never arrived. I suppose, the mere payment of the bonuses signalled to the "market" that the profits had, indeed, arrived, and this pushed the stock price up and....

No one else would do it, but Enron had taken the risk, had had the idea. They had been bold where others had been timid. They, the "greater" company, deserved to profit from their enterprising daring-do. A small detail like the inability of India to pay for the power should not get in the way of Enron's justly deserved profits. To allow such obstruction would be to re-enslave the free market, stifle creativity and self-expression, to de-incintivize innovation.

If we say - as I, indeed, do - that this idea, mark-to-market, is applied globally by the United States, the hegemonic implications in economic matters can be seen. Now cast your mind back to the 1990s. During this decade, the chattering classes would come on television - and from the vantage point of American prosperity - talked about China, a real up and comer, and so on and so forth.

There are two points the pundits always seemed to hit, in reference to China. They would always say that China was "manipulating" its currency; and that China was not very good at protecting intellectual property. One got the impression that the Chinese central government was nothing more than a group of vampiric, knowledge thieves.

In any event, if your were at all like me, during those years, you didn't know what the hell the pundits were talking about, shrugged, and changed the channel to watch The Simpsons. But note this mark-to-market scheme. I mention it because there is some indication that the U.S. government uses a kind of mark-to-market system in reporting certain statistics regarding the health of the American economy (3).

Could it be that criticism about China's lack of protection of "intellectual property," has something to do with the central government's wariness of, or reluctance if not refusal, to permit mark-to-market, thus signalling a moral failure on the part of the Chinese, in that they were not willing or able, yet, to fully embrace modernity, decency, and the free market, and thus join the happy community of capitalist nations? That is an uncomplete thought, and I leave it at that. I could be wrong.

1) It seems to me that Kevin Phillips's books, Wealth and Democracy, and Bad Money: Reckless Finance, Failed Politics, and The Global Crisis of American Capitalism, are both chronicles of the continuing descent of the American political economy, deeper and deeper, into virtual capitalism - where nothing is what it seems. I'm talking about the increasing financialization of the economy. This virtual aspect of capitalism is also reflected in the corporate emphasis on "branding," as Naomi Klein would have us understand, in her book, NoLogo.

Enron seems to have been an extreme, "criminal" example, whose entire operations, almost, were of a virtual nature.

Also there seems to be a virtual aspect to official U.S. statistics with respect to the true health of the economy. We are all familiar with the unemployment rate, officially, ten percent. But the true unemployment rate - when you count all the people who have stopped looking for work because they think its hopeless, people working part time who would like to be working full time, and people who are simply excluded arbitrarily from the unemployment rolls after a certain period of time, etc - is probably something like twice that.

Kevin Phillips talks more about faulty statistics in his book, Bad Money, in places. Also, there seems to be problems about how GDP is officially calculated; in fact, it seems that half of what is called 'international trade,' from the American side and globally, is comprised of intra-firm transfers of goods across borders.

If Corporation A moves some equipment from its plant in Milwaukee to its plant in Calgary, that is called trade. I learned about this from Noam Chomsky's book, Free Market Fantasies. Again, I have to admit, I haven't read it yet, but I watched the five part YouTube video with Dr. Chomsky talking about it.

2) The term "Disaster Capitalism," of course, comes from Naomi Klein's book, The Shock Doctrine: The Rise of Disaster Capitalism. Virtuality is what capitalism resorts to when it runs up against its physical limits to expansion (environmental, overproduction, and what I like to think of as the inherently limited qualitative improvement and differentiation of products so that advertising [another dimension of the virtual economy, yes?], comes into play and it become necessary to assert vigorously that this ball point pen is infinitely different, more desirable, and cooler, than that ball point pen, and so on and so forth. But violence is the second phase capitalism resorts to when it runs up against its political and ideological limits, internationally. Shocked to learn it, but not everybody wants capitalism.

One thing we should note. In his book, A Brief History of Neoloberalism, David Harvey says that neoliberalization is not always initiated by the United States imposing that on a country through the International Monetary Fund. He cites the case of Chile in the seventies. He says that the Chilean case was a situation in which the Chilean bourgeoisie invoked U.S. support for an internal coup. The Class Connection. Harvey says that a lot of the IMF restructuring that goes on happens because some internal class formation, who cannot do it themselves, wants the IMF to do it, so they can have the economy they want, and have the additional benefit of "blaming" the IMF in a populist way.

wingedcentaur

Good Evening Friends,

So, neoliberalism is capitalism, the old capitalism unbound, unchained, unplugged, if you will. It is the capitalism freed from New Deal era regulations and restraint. It is the 'new' 'liberation' or 'liberty' of capital to make a profit. We know this because capitalism under neoliberalism does the same things, starting in the eighties and prevailing today, as capitalism did in the 'Roaring Twenties,' and further back, during the age of the 'robber barons.'

Both eras of American capitalism, pre-Franklin Roosevelt and post-Carter, are characterized by similar features: manipulation of the stock market, rampant financial criminality ("control fraud" and other less sophisticated three-card Monte-typs Ponzi schemes), abusive labor practices toward women, either domestically or abroad in the overseas "sweatshops" of today, newfangled financial instruments, gross anticompetitive, monopolistic practices of big business, and the hysterical merging and consolidation of various concerns - which tended to raise antitrust red flags.

Neoliberalism is capitalism to the max, in response to perceived stagnation of profits, on the part of the capitalist ruling class. It's like saying: Okay, alright. No more fooling around. Now we're really gonna practice some capitalism around here.

More tomorrow.

wingedcentaur

Good Evening Friends,



We were defining the term neoliberalism, as the geographer and author, David Harvey gives us to understand it in his book, A Brief History of Neoliberalism. Now, I admit that I haven't read it yet, I've only viewed the YouTube video of the same name, in which Dr. Harvey discusses the thesis of his book. However, if he is half as good a writer as he is a lecturer, then the book itself is certain to be enlightening as well as accessible.



Neoliberalism. The 'neo' comes from their [the ideology's proponents] adherence to neo-classical economics (whatever that is); the 'liberal' part was added because 'they' took the ideas of freedom and liberty that were really born in the eighteenth century, very seriously.



Harvey says that neoliberalism, as a concept of political economy, is complicated with many variations. But, broadly, neoliberalism is the belief that human well being will be maximized when a society moves to a system of unrestricted free markets, free trade, galvanized around doing whatever is necessary to create and maintain an optimal business environment; which will mean, of course, that everyone will benefit, society as a whole will prosper.



Neoliberalism tends to call for deregulation, the removal of standards and accountability that are seen as chains binding the soaring spirit of the individual and stifling innovation, and the like. The regulations are seen as an imposition of 'individual' liberty. By the way, I hear that the right-leaning Supreme Court has just ruled that corporations has First Amendment rights just like people and may therefore spend as much money, directly, as they want in political campaigns.



To some of you, this may sound like crass materialism and greed. But we have learned how inseparably intertwined the ideological or spiritual is with the material. Here, I must elucidate a point made by Dr. Rick Wolf. He says that from 1820 to 1970, the profits of the American industrialists, as well as the real wages of workers, rose unfailingly every decade. This was so with workers wages, even during the Great Depression, because prices (which real wages are measured against) fell a little more.



This level of sustained national prosperity was, perhaps, unprecendented, never duplicated anywhere else. The American working class developed an exceptionalist view of themselves with respect to the rest of the world. They tended to expect never-ending "growth" in the economy; and growth of prosperity from generation to generation. Children will do "better" than their parents, whose grandchildren will surpass them all, and so on and so forth.



A working class such as this, says Wolf, can be forgiven for coming to see their sense of self worth, their sense of success in life, by what they have: their possessions, goods, stuff, bling. What car? What mall? What house? What neighborhood? And so forth. So, the American working class, as well as Americans generally define themselves by what they have. Man is the desire to become God, after all. Remember what I said about class mimicry. All classes tend to mimic the effects of the classes above themselves. This very fact explains the black market volume of "counterfeit" goods, and so forth.



Neoliberalism tends to seek to keep taxes - on business especially - to a minimum. Taxes, after all, are a yoke, punishing initiative, "de-incintivizing innovation." Taxes, therefore, are, by their nature, in their view, an oppression of the freedom of the 'individual,' - to make money, thrive, prosper.

Neoliberalism seeks the world over for the most "flexible" labor markets. They find these more flexible labor markets in the developing world, and use the existence of these to pressure the domestic labor market to be more flexible. Government mandates about the minimum you can pay workers or what level of minimally decent working conditions must prevail at the factory, hamper the creativity of the 'individual.' The environment? Concerns about the environment are just another distraction, hampering the neoliberal capitalist from expressing himself.

Neoliberalism aggressively seeks out new markets around the world. It is the neoliberal thrust upon the globe, which is called 'globalization.' Neoliberalism seeks to break down 'trade barriers' of other countries with potential customers for American products and resources that American corporate interests would like to get a piece of.

Neoliberalism scoffs at policies of other countries that it sees as protectionist, or neo-mercantilist, we might say. Such "protectionism" cuts off American capitalist from foreign markets, and therefore oppresses the freedom of the neoliberal capitalist. Such a "regime" must be, by definition, anti-freedom - and the population of such a country might require "liberation."

Neoliberalism is capitalism, the old capitalism freed from the restraints of the regulatory and social welfare policies of the New Deal, Fair Deal (under Truman), the Great Society (under Johnson), and some relatively progressive policies of Richard Nixon. Capitalism had been "free" before Franklin Roosevelt, suffered a period of oppression, but then was free again under Reagan, Bush, Clinton, Bush, Obama, and beyond? In this connection we can think of neoliberalism as the new liberation or new freedom of capital to make a profit.

Remember, capitalism had an accumulation crisis in the late seventies. The defeated World War Two powers, Europe and Japan had recovered by the mid 1970s and put their industry to work to make their goods better or cheaper - in some cases both - than American industry. The good times (between 1945 and 1975 when American capitalism had no competition as Europe and Japan had to rebuild their societies by buying American goods) had stopped rolling. Other things happened too, but for the sake of time, we shall skip mention of them. The point is that there was a profitability crisis for American capitalism in the seventies.

With the election of Ronald Reagan in 1980, the neoliberals (Milton Friedman, Friedrich von Hayek, and others), having lain in wait in their right-wing think tanks since the 1940s, thought they had their champion... and the rest is history.

David Harvey says that we should be aware of the extent to which, all of us - in a strange way - are neoliberals, how the society as a whole has absorbed the neoliberal ethos.

When New York Times columnist, Thomas Friedman famousy said, that two countries that both had a McDonald restaurant in them, never went to war - this is an expression of the neoliberal ethos. It is the idea that economic interdependence somehow insured peace between nations.

Fareed Zakaria's use to often say that, with non-democratic countries, the way you build democracy is to focus on building civil society first, with no small part of it being the creation and economic empowerment of the middle classes. At this point, these middle classes, can now pressure government to act in a way that is accountable, transparent, and govern by some kind of rule of law.

This, also, in my opinion, is an expession of the neoliberal ethos. With money, the emergent middle classes in developing nations, might pressure the government into giving them their "freedom."

Neoliberal theory says that just as there should be little or no government regulation and taxes stifling the capitalist's creativity, there should be o government intervention - when things go wrong for the capitalist. The state is, at best (mind you, I say, at best), the state role should be to make sure there is a "fair playing field." But mind you, many have noticed, including David Harvey, that there has always been a huge gap between neoliberal theory (argued passionately by the theoretical free marketeers) and neoliberal practice (as executed by working, "in the trenches," practicing capitalists.

Let me just close with this, now. It is in this gap that we see the ways in which the capitalist ruling class try to escape capitalism. We see the ways in which New Money tries - and mostly succeeds - in becoming Old Money. And in this gap between theory and practice, we see the root of financial and economic crisis in capitalism - the mass stampede of New Money bourgeoisie to break out of capitalism.

This naturally makes capitalism unstable, in the same way mass, concerted efforts of inmates to break out of a prison, causes the particular institution to be unstable. What I'm saying is, that in the same way an inmate wants to break out of jail, so too, do the oligarchy feel trapped by capitalism, as counterintuitive as that sounds.

This prison break on the part of the oligarchic capitalist class primarily takes the form of financialization, these days, and a focus on branding, as well as massive, forceful movement in the direction of what former bank regulator, William K. Black, calls "control fraud."

Control fraud is the accounting and other fraud that is generated by seemingly legitimate organizations. This sub prime situation is an example of what Black considers control fraud. According to Black, an FBI investigation has found that eighty percent of the fraud that happened in this housing crisis, was initiated by lender action. And so on and so forth.

Alright, I'll go on with this tomorrow.

wingedcentaur

Good Evening Friends,

We have, very briefly, looked at a couple of examples of how Old Money never really goes away, politically, with the Queen of England in action in suspending parliament in Australia and Canada. The English monarchy is Old Money (none older really, is there?) and supposed to be, as I had always understood, merely titular, merely symbolic, a token of the British imperial past. Though the monarchy is not what it was, the crown is far from voiceless - as the spokesperson of the oligarchy as a whole - in international affairs of the political economy. This reality of the supposedly virtual is fascinating, is it not?

In his book, Wealth and Democracy: A Political History of the American Rich, Kevin Phillips wrote:

"The decline, or seeming decline of the wealth of certain old money families is deceptive: Rockefellers, du Ponts, and Phippses, although well down in the top thirty of 1999, [some kind of Forbes listing, or something of that order] still increased their holdings pretty much throughout the twentieth century (1)."

"In his 1937 book, America's Sixty Families, Ferdinand Lundberg had estimated the combined wealth of these five dozen in the $ 9 billion range. About 60 years later, four of the richest - Rockefeller, du Pont, Mellon, and Phippses had increased their combined $2 to $4 billion of 1937 to roughly $38 billion without owning a dominant piece of any emergent industry. Elaborate trusts, well-staffed family offices, and professional financial management had combined into the U.S. equivalent of the entail and primogeniture that kept landed wealth intact and concentrated in eighteenth and nineteenth century Britain (2)."

Let's keep going. It seems that hedge funds are the preferred investment vehicle of the top one percent. These require an investment of one million dollars (and I heard one has to sign a legal statement saying that you can lose one million dollars without it breaking you or even lowering your standard of living. You have to be able to shrug off a loss of one million). Hedge funds, at least at the time of the publishing of Mr. Phillips's book, were not regulated, unlike mutual funds. At the time, six thousand were thought to be in operation worldwide, with the biggest concentration - over one hundred - in Greenwich, Connecticut (3).

A magazine article had quoted "Wall Streeters" saying that the intellectual capital of New York was moving to the Greenwich area, and senior execs at Fidelity Investments complained that hedge funds, by luring "hot shot" managers away to their firms, was reducing the quality of money management available to middle class investors, in funds like Fidelity's, say (4).

This rather sounds like the richest team in some sports league, vastly outspending everybody else and therefore acquiring a seemingly unfair proportion of the best talent coming out of college, or whatever. And we have known of the way the bourgeoisie gets richer and richer by dispossession, eminent domain, and the like. But the oligarchy dispossesses the middle class of its pool of investment talent, and therefore potential profits. In this subtle way the oligarchy steals talent and therefore, money from the middle class in this way.

Another thing rich families could do to maintain and increase their wealth, in yet another non-capitalist way, was to set up private trust companies. And under laws in states like South Dakota, Wyoming, and Delaware, these operations could pool small trusts into a common trust fund invested collectively, with no regulation to speak of and with access to hedge funds. One 1998 analysis showed the families that had formed such 'captive' trusts included the Bells of General Mills, the grain-trading Cargills, the Ziff publishing dynasty, and the Pratt family of Standard Oil (5).

The Pratts had a family office serving two hundred fifty members. Many of the younger Pratts couldn't access high-quality management - for some reason - and had their money in boorish, middle class mutual funds. A captive trust solved that problem (6). In 2000 Forbes magazine noted that that 137 out of the Forbes 400 - more than a third - had inherited their wealth or built their fortunes from inheritance (7).

Still, I doubt the remainding 263 were "rags-to-riches" cases. To continue.

"The postmillennial crash of the technology-heavy Nasdaq, so devastating to the new Internet, software, and telecom fortunes, had much less effect on old money tied up in trusts and family holdings and widely diversified among investment sectors (8)."

"While technology and communications had taken a huge hit, other categories had come on strong by 2001. Oil was one, along with retailing and another grouping that could best be described as food, beverages, and consumer products like cosmetics and greeting cards. Not only did this favor the old economy (old money), but it favored family holdings, not a few of older money like the Wrigleys of chewing gum fame (9)."

1. Phillips, Kevin. Wealth and Democracy: A Political History of the American Rich. Broadway Books. New York, 2002. pp. 114-115.

2. ibid, p.116.

3. ibid

4. ibid

5. Phillips, Kevin. pp.116-117

6. ibid

7. ibid

8. Phillips, Kevin. Wealth and Democracy: A Political History of the American Rich. Broadway Books, New York, 2002. p.124

9. ibid, p.126

Now, remember when I cited the 1999 Wall Street list of the fifty wealthiest people of the last thousand years, which I cited from Kevin Phillips's book? Most were kings, conqueror-rulers, popes (two), high government officials. Others were traders operating under official license. Still others were bankers, especially for kings and popes. Others were involved with commodities like oil.

Only one person on that list - only one! - could be said to have made his fortune by practicing anything like capitalism (making a better mousetrap). That was Bill Gates, head of Microsoft, the only one who could be said to have made his wealth by taking the helm of a leading corporation of an "emergent industry."

My takeaway from the quotes from Phillips is that Old Money is, perhaps actually and certainly perceived to be, sturdier than New Money. Old Money seems to survive the fluctuations of the market better than New Money. Sure, some newfangled invention or fad always comes and goes, the basics, the pillars of human need, remain (you know, like food, beverages, cosmetics, and greeting cards).

Remember the quote: "Elaborate trusts, well-staffed family offices, and professional financial management had combined into the U.S. equivalent of the entail and primogeniture that kept landed wealth intact and concentrated in eighteenth and nineteenth century Britain.

One can't say it any more clearly than that. Financial operations, largely divorced from production, allowed the creation of a literal American aristocracy in real wealth and social terms, going back at least as far as 1937. That is the meaning of "professional financial management had combined into the U.S. equivalent of the entail and primogeniture [of]... landed ["concentrated"} wealth in eighteenth and nineteenth century Britain."

Let's take a look at the ways the New Money bourgeoisie tried to and did transform themselves into the Old Money bourgeoisie.

In his book, Kevin Phillips spoke of the financialization of the American economy during the period of 1980-2000. This dovetails perfectly with what we know to have been a crisis of capital accumulation of capitalism in the mid and late 1970s.

Professor of economics, Rick Wolf - someone else I know of from Internet ("Capitalism Hits the Fan," and so forth) - gives us valuable history. From 1820 to 1970, one hundred fifty years, American capitalism and the American working class enjoyed a totally unprecedented period of success and expansion. For every decade between 1820 and 1970, real wages (the money we earn in relation to the prices we have to pay for stuff) rose, along with unfailing and equally consistent rise in the profits of the corporations, of course.

And there was a sweet spot of a thirty year period of 1945 to 1975. 1945 was the end of the Second World War. Europe and Japan lay in ruins in the Truman years. American industry had no competition, and, indeed, Europe and Japan had to rebuild their societies by buying American goods.

But by the mid 1970s, the good times stopped rolling. Western Europe and Japan had recovered and figured out how to make products either better and/or cheaper than American industry. This was the during the presidency of Jimmy Carter. Remember The Malaise Speech and stagflation [stagnant growth plus inflation]?

American capitalism was just not bringing in the profit levels they had enjoyed in the sixties. And, at this point, the ruling class remembered how much they hated The New Deal (Roosevelt), The Fair Deal (Truman), The Great Society (Johnson), and even the progressive modifications put in by Nixon; and they lamented about it had been these restrictions upon their "freedom" that had spoiled capitalism, cut into their profits, and therefore - since what's good for General Motors is what's good for America- had been responsible for the economic slump of the era.

The conscious, deliberate, programmatic response of the ruling class to the economic crisis - of the nation as well as their own dip in profits - is known as something called neoliberalism. Neoliberalism might be thought of as capitalism squared or cubed with an internationalist orientation.

The geographer and activist, David Harvey defines neoliberalism like this: its neo because its adherents's commitment to neo-classical economics (whatever that is). The 'liberalism' comes because they took the ideas of freedom and liberty of the eighteenth century seriously.

Alright, my eyelids are getting heavy. I'll take this up tomorrow.

wingedcentaur

Good Morning Friends,

Since Old Money is transcapitalist (has transcended, or escaped capitalism, as I have mentioned but will set forth in more detail when we look at the theses of Kevin Phillips's book, Wealth and Democracy: A Political History of the American Rich and Naomi Klein's book, NoLogo - both of which argue two sides of the same coin, as it were, from a quantitative and qualitative points of view, respectively [Kevin Phillips talks about financialization and Naomi Klein talks about "branding"]) and New Money is capitalist, or I think we should say, super ultra capitalist; and since New Money always wants to become Old Money; New Money, therefore, also wants to escape or transcend capitalism.

But why should the bourgeoisie want to escape capitalism, the system they created, that serves them so well, that has bestowed income levels and wealth levels many hundreds of times multiple of what the rest of us, combined, own, to the point where multinational corporations are richer than many mid-sized countries?

Let's go back to Old Money. Really old Old Money, the Queen of England-type Old Money, did not and never had to - underlined that 'never had to' - practice capitalism to come by their fabulous wealth and power. It was wealth and power showering down upon them - or seeming to - by dint of divine right. I am just, intrinsically, so much better than everybody else! Its money without really having to work for it (again, think of financialization - derivatives, collateralized debt obligations, mortgage-backed securities, and so forth, paper shuffling finance creating quantum wealth largely separated from physical production (working we might say). As I said before, financialization and focus on branding, are ways of quickening the aging process of money, to my way of thinking, that is.

Remember the movie, The Matrix with Keanu Reeves? I'm talking about the first movie of the trilogy. One of the "agents" of the system (computers taking over humans system) was called Smith, played by a very fine character actor, whose name I don't know, but who also played the head elf in Lord of the Rings.

The physical presence of the agents on Earth was necessary because it was they who were the enforcers, charged with handling problems, destroying rebels, and keeping the human population in line. There was a scene in which Smith had captured Morpheus (played by Laurence Fishburne, who was Neo's [Keanu Reeves] mentor) and tortured him.

Smith told Morpheus how much he hated that realm, how much he longed to return "home." Smith didn't like the smell of the place. The point is that he, Smith, a being not from our planet and dimension, and thought it was a lower realm than his territory of origin, to which he wanted to return. I think we can say that Smith, feeling that he was condemned to troll our unworthy realm until his mission was completed, was more vicious in pursuit of his goal, so that he could finish his business and return to his realm as quickly as possible.

Science fiction and fantasy literature is full of scenarios like this, in which a being from another planet or dimension. He is "stuck" on our world and/or dimension, which usually also means our planet Earth, for some reason. He either has a crucial mission to fulfill and that is why he has been condemned to this "backwater." Or he might have been banished here as punishment for some crime or failure.

Invariably, these beings are anxious to get back home and to what they see as their proper station in life. They will do anything they have to do, to get back to where they have come from just as quickly as possible. The resentment at being stuck in a lower realm and their eagerness to get back home, combines to maked him that much more ruthless and determined, vicious, pitiless, and uncompromising in and to the supposedly lesser beings of our lower realm.

This is what I shall try to argue about capitalism. The bourgeoisie - or if you prefer a more neutral, populist term - , the oligarchy, actually see capitalism as a lower realm, from which they desperately seek release from, to ascend into the realm of effortless, graceful wealth by divine right - to become the Old Money which whom they frequently clash. Because of this the ruling class tend to practice capitalism so unmercifully, constantly putting downward pressure on wages, benefits, and working conditions, frequently using female, indentured serviture female, sweatshop labor in the developing world, occasionally even resorting to using child labor, hiring workers they know to be undocumented but actually calling the INS themselves, if these workers cause too much agitation about wages and conditions, and so on and so forth.

To be continued.

wingedcentaur

Good Evening Friends,

To continue. We were talking about the English monarchy. I referred to two examples in which the Queen, apparently, and remarkable, seemed inclined and exercised the power to suspend parliament - in two other countries, neither of which was even England itself! Apparently, the monarch is still, legally, ceremonially, symbolically, traditionally, the head of state of the commonwealth territories.

The Queen of England, according to historian, Webster Tarpley, can be properly called the spokesperson of the ruling oligarchy as a whole. The consensus of the oligarchy is incubated within and expressed through the office of the monarchy, apparently - through the offices of the royal governors general.

The fact of the existence of the monarchy in, allegedly the twenty-first century, goes to my point about Old Money never really going away. The English monarchical system was a "first among equals" (remember that phrase?) set up, unlike the relatively uncompromising, absolutist French kingship.

This bring up some questions: 1) What should be done with deposed elites? 2) How can they be rehabilitated and integrated into ordinary society? 3) Whaty is ordinary society? 4) What should be done with the surplus property of the deposed elite? 5) By the way, what is the relationship between freedom and equality?

The question of how an old national monarchy and be rehabilitated and merged into normal society is a difficult puzzle. One couldn't just chuck the Windsors out of Buckingham Palace and say to them: "Okay, now you all go and get jobs." None of the royals, as individuals, can make a move without the tabloids all over them, which must cause disruption of normal life for other people, and so on and so forth.

And, of course, people don't generally want to go backward, or downwardly mobile, as they might see it. Man is the desire to become God, after all.

The tendency is good, bad, and indifferent. Man's desire to become God spurs people to creativity, discipline, focuse, determination, and perseverance. Man's desire to become God may results in activities of, what we have called in the past, applied philosophy [bodybuilding, for example, as I have mentioned].

Lastly, this tendency results in class envy, class mimcry or mirroring, and fear-based power and/or money greed resulting in subsequent violence - of one kind or another. Remember, I gave a broad definition of violence, before. It seems to me that we want to keep the first two effects, while thinking about how to greatly ameliorate the last one. But then again, if the last effect could be eliminated or severely ameliorated, would it necessarily come at the expense of the first two?

I don't know.

wingedcentaur

Good Evening Friends,

I would like to take up a point I made, in passing, about the Queen of England, the office of the surviving English monarchy as a whole, and how it relates to power. Remember we said that legally the queen owns all the land of England, and that when she dies, all the mailboxes in England will have to be changed (they have her seal on them)? Remember we pondered to what extent the monarchy still exercises power. Sure the monarchy is supposed to be symbolic and...

Here, I would refer you all to a seven part lecture on YouTube by Slavoj Zizek called "The Reality of the Virtual." He considered 'virtual reality' to be a miserable concept, boring perhaps. All this is is the reproduction of our concrete reality by holographic means.

Much more interesting, in his view, (and he's made a believer out of me) is to consider the reality contained within the virtual, the real concrete force of the seemingly symbolic.

As I said before, the surviving English monarchy, for example, figures into our conception of the Old Money/New Money dynamic we have been discussing. Old Money doesn't come any older than the English monarchy.

And I point to the English monarchy as just one small example of something I always say: just as matter can neither be created nor destroyed (is this the second law of thermodynamics?), so too does old money never disappear. This is in somewhat of a contradiction to classic class theory, as I understand it. Classic class theory tells us that different groups come to prominence in the bourgeoisie, leadership of the ruling class is shifting.

As I said before, I understand the bourgeoisie to be basically divided into New Money and Old Money; and I hope I have provided a half way credible argument that New Money always wants to become Old Money, just as quickly as possible. Remember also, that I mentioned that there are at least two ways, I know of, that New Money tries to quicken the aging process of their "money" and therefore themselves (and this part is crucial, money is more than just money): financialization (Kevin Phillip's book, Wealth and Democray) and the corporate emphasis on "branding" as opposed to actually making things (Naomi Klein's NoLog).

We also talked about the Corleones in The Godfather and the Clericuzios in The Last Don. Money laundering, engaged in by "criminals" is a way of trying to transition from New Money to Old Money. We talked about the focus of Don Clericuzio, and more particularly, Don Corleone engaging in what might be thought of as transitional activities, not so much in a effort of going "straight," as much as trying to go untouchable.

Man is the desire to become God.
Business people are driven to try to have "more money than God."
Corporations (remember, practicing capitalists as opposed to theoretical capitalists) want to become government.
Government wants to become the aristocracy and the monarchy.
The monarchy wants to make the church say they are the personal representatives of God on Earth.

Now, on the December 5, 2008 broadcast of The Alex Jones Show, the veteran journalist and broadcaster hosted the historian and author, Webster Tarpley, a frequent guest on the program. Their interview is on YouTube. Just type in something like: Webster Tarpley on Alex Jones tv "Magna Carta."

Mr. Jones opened the show by referring to a reuters article. Apparently, Canadian prime minister, Stephen Harper won suspension of parliament. It seems that he had lost control of the government and become the minority party; and he refused to allow elections to seat a new PM.

I'm sure Mr. Harper would not put it that way. But here's the interesting part. Canada's governor general, Michelle Jean, the personal representative of Queen Elisabeth, Canada's head of state, agreed to this.

Now Alex Jones read that part from the article. He had the reuters article in front of him. Symbolically, the monarch is still the head of state of the commonwealth territories. But we are about the business of examining the substance behind what is supposedly merely virtual.

Why did Harper want parliament suspended? We'll come back to that. Jones then asked Tarpley for his take on the article, handing it to the historian. Scanning quickly, Webster Tarpley said that that was the first he was hearing of it but that there was supposed to be a vote of no confidence against Stephen Harper, and so on and so forth.

Tarpley mentioned that there had been political agitation in the 1960s and 1970s around bringing the constitution home - I suppose to detangle Canadian political life from part of its medieval colonial past - which, it seems, didn't happen. Oh well...

Webster Tarpley gave two other examples showing how the English Monarchy still has some real teeth, shall we say.

1) in 1975, the Australian prime minister, Gough Whitlam wanted to do independent oil deals with Arab producers. Australia would get the oil and the Arab producers would get Australian technology, and so on and so forth. Well, the London and Washington-based oligarchies said no. Apparently Whitlam wasn't persuadeable or bulliable (I just invented the word bulliable) and he had to go. The Australian governor general, again, personal representative of the Queen of England, saw to his "overthrow," and replacement with a chap called Malcom Fraser - whom the parliament immediately issued a vote of no confidence against.

Tarpley didn't quite finish the story but implied that in this case, the Queen - as representative or spokesperson of the oligarchy as a whole - got "her" way.

2) When Canada had its NAFTA debate, Tarpley says that the Queen, again, actually named new senators to the Canadian parliament, somehow. Alex Jones said that initially they were supposed to be elected, but when candidates, not amenable to the Queen's position, looked like they were going to win, the crown went ahead and superseded the process. Tarpley characterized this by saying she "packed" parliament, not unlike the way Franklin Roosevelt had tried - and failed - to "pack" the Supreme Court, remember?
But Jones asked Tarpley who won that fight. Tarpley said the Queen won.

Now, why did Harper seek the suspension of parliament? Alex Jones and Webster Tarpley did not say. But I would refer you to an article on the infowars.com web site titled Prime Minister Harper officially Endorses NAU.

NAU stands for North American Union, the political and economic fusion of the United States, Canada, and Mexico. Some people think of NAFTA as the economic arm of this project. Some people see this as one tiny step forward in what the left calls the New World Order of things to come - not a good thing. But we may come back to NWO another time.

Anyway, that is what the article is about. Canadian prime minister, Harper, thought that was a good idea. Its an October 3, 2008 article. Harper's government had reportedly been in the process of getting various Canadian government agencies to "harmonize" with U.S. governmental agencies, and so on and so forth. Probably, then, the struggle that Tarpley and Jones were referring to, involved this.

No need to go into detail about the article. To return to the Queen of England. Webster Tarpley's precise formulation is this: the Queen of England or the Crown in general is the spokesperson of the oligarchy (or bourgeoisie, or bourgeoisie/aristocracy) as a whole - which, we might, is what any political head of state, such as a prime minister or president, is today, to be generous.

We'll go on with this next time.

wingedcentaur.

Good Evening Friends,

Let's review where we are. We have been considering two branches of what Marx called the bourgeoisie, the capitalist ruling class: Old Money and New Money. This, I think, is slightly contrary to most Marxist theory. It is slightly contrary to what is called the dialectical materialism school of historical interpretation.

Don't be intimidated by the word 'dialectical materialism,' as I had been. In the first word you see the smaller word dialect. What is dialect? The dictionary defines it as a regional variety of a language, understood to be a part of a larger whole.

What is materialism? You know what that is. It has to do with stuff, 'bling,' money, goods - material things that are symbols of wealth and comfort and the like.

Dialectical Materialism, then, is simply the view that human history is concerned with the struggle to gain wealth "by any means necessary." This is the materialism part. Within this global, historical struggle there are various class struggles and ascendancies. These class struggles and ascendancies provide the dialectics. The world speaks with different dialects [think of this in a very similar way that you would with language!]

Bourgeoisie exploitation of the working class and the poor takes a different form in America than it does in England, than it does in Indonesia, than it does in France, than it does it Egypt, and so on and so forth. It could be no other way, as these are different countries with different languages, different customs and traditions, different histories. Similarly, democratic triumphs of wokers will take a different form in Hawaii, than it does in Sweden, than it does in Bolivia, than it does in Malay, for the same reasons.

In this kind of analysis, the top echelon is said to always shift a little. The bourgeoisie supplanted the aristocracy, we are given to understand, much like Zeus and the Olympian gods overcame and replaced his father, Cronus and the Titans. And so on and so forth.

However, under the theory that 'A rose by any other name is still a rose,' and data provided by Kevin Phillips's book, Wealth and Democracy: A Political History of the American Rich, to attempt to persuade you that just as matter can neither be created nor destroyed, so too, it is true that the aristocracy (by any other name) or Old Money, never actually goes away.

In fact, the bourgeoisie wanted to become the aristocracy (even if under a different name), New Money always has and always will want to become Old Money, the corporate world, far from wanting to dismantle government, far from merely wanting to feed at the public teet, it wants to become the government by merging with it - like the Borg!

This is so, in my opinion, as I have said repeatedly, just as surely as Man is the Desire to Become God.

Now, I have given definitions of Old Money and New Money. Let me add a wrinkle. New Money is capitalist. Old Money is not, in that it has transcended capitalism, in that it does not have to engage in capitalism (the buying and selling of goods and services, labor, shareholders, government regulations, etc; and one's wealth or family's wealth increases reliably and exponentially in ways that are almost completely divorced from the vicissitudes of the "free market."

Here, you should be thinking of financialization, which I mentioned before. I said before that financialization is one of the primary ways, today, [and here, I include the money laundering mechanisms employed by the international criminal kingpins] that New Money tries to quicken the "aging" process of their wealth, transmuting their wealth and themselves, socially, into Old Money.

I'll finish this review - before moving on to the rest of my thesis - tomorrow.

wingedcentaur

Good Morning Friends,

Let me briefly comment on something that is not unrelated to what we're discussing. It would seem that the banks are paying back their TARP money and so forth. Some people want "reform" in the compensation structure. It seems that Wall Streeters are set to receive another round of fantastic bonuses and stock options and the like.

We are coming to realize how much compensation of these folks and, of course, the CEOs are detached from performance. We're really left scratching our heads, trying to figure out why Wall Street acts like this and why doesn't government do anything to stop it.

What if the answer is class power? What if the motivation, on the part of Wall Street and government's apparent apathy, involves the maintenance of a class-based social structure? Hold that thought.

I was listening to the radio earlier this morning, a show on NPR called The Take Away. They had a professor of behavioral economics at Duke University. I forget his name, but he's good. He's a frequent guest on the show.

There was a discussion on the show about the compensation of Wall Street traders, hedge fund people, and so forth. He correctly pointed out that a discussion of compensation should be divided into two parts.

For twenty-odd years or so, their collective action seems to have kept the market "up." Therefore, we thought that special skills, talents, ability, and know how that allowed them to foster, maintain, and manage this "growth." Believing this, we, the people, vaguely felt that they "deserved" such rates of pay.

As the revelation of the source of this present crisis continues to unfold and we learn more and more, we find that we gave them far too much credit. We know that there were gaps in their understanding of how the financial system was working these days. We hear about the role of mathematicians and physicists from M.I.T. and other place in designing exotic financial products.

You know what this dynamic reminds me of? The Emperor With No Clothes. Remember the story. Two con men come to a kingdom, saying that they are weavers of the finest garmets. They said that their work was so sublime that anyone who could not see the clothes, were not competent rulers. The vizier comes, sees nothing and yet not wanting to think he's incompetent, pretends to see them.

The king comes in, sees nothing and yet not wanting to think he's incompetent, pretends to see the clothes, gives effusive praise for the beauty and so forth, and you know the rest...

But that aside, what if pay on Wall Street and in the corporate world in general in about maintain class hierarchy? What if we thought of the Wall Street traders, hedge fund people, investment bankers, and the like, as the lower rungs of the bourgeoisie. Even though they are technically "workers" who must sell their "labor," we can hardly think of them as the proletariat.

By the way, the second part of the behavioral economist's discussion was about the efficacy of bonuses, and experiments found an actual inverse relationship to size of bonus and performance. The more money involved, the more pressure was felt, and so on and so forth.

If you're a CEO of a Fortune 400 corporation of staggering wealth, [maybe you own an island], you can't have the people just below you - mind you, I say just below you - [top executives and upper level managers, and so forth] driving minivans, having to sweat their bills, having to go through mental contortions figuring out how their going to send their kids to college and the like. In other words, you can't have them living like the middle class.

First of all, that would put more pressure on your compensation, as the Fortune 400 CEO. Second, these people on the strata, make up the social layer that you interact with socially, that you may have originated [again, we're talking about, in total, a very, very, very narrow range of society] in. We're talking about your "world," your very world.

Anything approaching serious reform in pay for the corporate world and Wall Street, would bring your world under threat, might even deal a fatal blow to it. Think of it, this might mean that suddenly scores of people could no longer afford their country club memberships, and raquet ball health club memberships.

All of the sudden multitudes could no longer afford to send their children to elite private schools and from that flows the interruption of childhood friendships. Suddenly multitudes of nannies and other live-in and outside staff have to be let go [see how they would pose as populists defending their way of life based on preserving these domestic help jobs]. People could no longer afford to give as many, or any parties - its all about networking, is it not?

Suddenly there would be a lot fewer hunting trips and golf outings and summer houses, winter houses, or other residences in other countries. These things give are symbols of success to the bourgeoisie [yes, bring them nearer to God, whether they 'believe' or not] and give them a chance to network and wheel and deal and yet again, increase their holdings, and so forth. Money is not just money - I'll have more to say on that point.

So, if you're a Fortune 400 CEO, any reform in compensation of your own pay and others at your level and just below you, reform in compensation would mean social and cultural catastrophe in your eyes.

wingedcentaur

Friends,

The Old Money-New Money dynamic is probably the most intricate and difficult part of the analysis I offer on capitalism. That is why we have had to spend so much time on it. And there is still one more point about this I must make.

Who are the Old Money and New Money?

Old Money are the real (titular) or effective aristocracy at the very top of the economic and social pyramid of society. New Money are the class just below them. Indeed we usually find that in order to become New Money, one is most likely born into a family of a certain material and social level.

Though the "rags to riches" tour de force does happen, it is rare. And of course, there is a whole body of statistical data showing how remarkably dynastic class is in America.

The second thing to emphasize is the difference between what Istvan Meszaros, philosopher, marxist, and activist, calls the world capital system (as a whole) and capitalism proper. The latter is only a few centuries old. The former preceded that by thousands of years.

I will define the capital system like this: it is the historical system of the absolute control of wealth, extraction, and distribution of resources literally without democratic or legal accountability (except to the king) to anyone. Sans "markets."

Capitalism: let's call it a system of buying and selling goods and services for a profit, under a structure of democratic accountability and subject of "market" forces, one capitalist in competition with another.

What we mean by capitalists: multinational corporations, banks, and industrial and technological firms, and so forth.

We do not mean the "mom and pop" store, the local karate studio, the corner diner, the family restaurant, and the like. They are, strictly speaking (very strictly speaking), part of the capitalist system, the reality of their effective function are rather like. Their presence in the community is a comforting touchstone. They're just there and it is good.

They do not have the werewithal to even consider thinking about dreaming of becoming nearly as rapacious (its different galaxies) as the multinationals.

And I'll continue with this tomorrow.

wingedcentaur

Good Afternoon Friends,

We now return to the Corleones in the garden. We had left Michael Corleone with his father, Old Man Vito Corleone, The Godfather of the "Corleone Family," the biggest mafia organization in America. We were talking about this scene from the legendary novel and movie, The Godfather, in the context of how - as we said before - New Money always wants to become Old Money, just as quickly as possible. This is so whether we're looking at the criminal drug lord or the lawful corporate world.

I have not forgotten my promise to talk about at least two, perhaps three methods that New Money use to quicken the aging process of their capital assets, transforming themselves almost overnight into Old Money, socially, legally, and politically. Perhaps we'll make it four. After all, if we include figures like the international drug dealer and consider the process of "money laundering," we understand that he is seeking to become Old Money.

The money laundering international drug dealer, gun runner, and human trafficer, and the like, as well as Don Corleone and Don Clericuzio, who "wash" their money and do all they can to establish a sustainable presence in the "lawful" world by establishing legal business concerns, seek to expand out of "crime" or the New Money, relatively more vulnerable status into the more powerful realm of Old Money. For these types of criminals - as a combination of Existentialist and Marxist analysis tells us, I think - it is not a question of going "straight" for ethical reasons, but going untouchable for legal reasons.

The rich international gangster wants to become the rich international corporate executive, who - as we have mentioned - wants to become the rich international, preferably unelected, government official. Man is the desire to become God.

Now, back to the garden. Old man Vito is talking about how he had no regrets in his life. He's proud of the way he'd been able to provide for and protect his family. "I don't apologize," Vito said.

Vito: I knew Santino would have to go through all this [this being the mobster thing]... And Fredo.... Fredo..... but when it came your time I wanted something better. Senator Corleone, Governor Corleone, something.

Michael: Another pezzenovante.

Vito: There just wasn't enough time, Michael. There just wasn't enough time.

Michael: We'll get there, pop. We'll get there.

And the Corleones did get there, didn't they? In the novel, The Godfather Returns, Michael spells out his long-term plan. Peace with all the other mafia organizations, followed by massive expansion and relocation to Nevada. Then would come reorganization of all the other crime families, better than before, somehow, as well as greatly increased business ties with Sicily.

Tessio and Clemenza (remember those two, Vito Corleone's closest and oldest comrades from the beginning?) were to be allowed to split off and form their own family. Michael would gradually seperate the "family" from anything resembling street crime, to focus on real estate development, the restaurant/hotel business, and gaming.

Then there was the senator from Nevada, whatever his name was. He was a corrupt politician but very senior and very powerful. Michael had negotitiations with him concerning a license for a casino he just bought.

The senator was giving "Don Corleone" a hard time due to what seems to have been ideological ethnic prejudice on the lawmaker's part. The senator's fangs, horns, hoofs, and tail came out as he explained to Michael Corleone that he resented the "dishonest way you people represent yourself," spoiling "this clean country with your oily hair," and so on and so forth.

The senator leaves the meeting with the admonition that the Corleones are not to contact him directly again, "from now on you deal with Turnbull," (a political bagman of his, no doubt, serving as the legislator's liason, as it were, to the underworld).

But then things changed. One night found the senator at an establishment run by Fredo Corleone - poor Fredo! - in which he accepted the favors of a young woman not his wife. But something seems to have "went wrong," and the young woman was dead, a bloody mess. The senator was found sitting over her body, himself clearly beside himself, claiming not to have known what happened.

In comes his savior, in the form of Tom Hagen, Michael Corleones consigliere and adopted brother, who was considered a Corleone (in relation to blood family Corleone) and Sicilian in all but name. He explained that the girl was a "nobody," with no roots, or connections to anybody, no family at all. It is as if she had never existed.

Don't worry about a thing, Hagen soothed. The body would be disposed of discretely. "All that's left," Hagen said to the senator, "is our friendship."

Later, there was a big underworld/corporate meeting in Cuba. It was the senator himself, not Turnbull, who was present and all smiles, saying to Michael, "I'm very glad we can spend this time together."

There's nothing more to say on this. More next time.

wingedcentaur

Good Evening Friends,

We left off last time with the legal position produced by Blackwater, the private military contractor, now known as Z Coroporation - having to do with the deaths of Iraqi civilians, and this was shortly after the Fallujah incident, I believe.

According to independent investigative reporter, Jeremy Scahill, Blackwater said that on the one hand they could not be held liable in a private, civil manner because they were a part of the United States of America "total force." However, on the other hand, they could not be held accountable under the Uniform Code of Military Justice because they're civilian contractors, operative word being 'civilian.'

There are many adjectives one might use to describe such a statement. But we are interested in its philosophical meaning. I would argue that the statement is a linguistic expression - phenomenologically - of the corporate entity of Blackwater and private military contractors in general, midpoint in its transmogrofication from corporate entity to "goverment."

Whaaaat!!!

The "revolving door" of Washington. If the corporate world does not want to destroy government, per se, but replace and become the government, what about the figures who go into government, then the corporate world, then government, then the corporate world, and on and on, so on and so forth?

Bureau-corporatists want to be in government and never want to leave government, per se.
But they also want more money...
But they want to be in 'government,'...
But they want more money....
But they want to be in 'government,'...
But they want more money....

Get the idea? Midpoint in the transmogrofication process.

Next time we'll return to the Corleones in the garden.

wingedcentaur

Friends,

Before returning to the Corleones in the garden, there was a point I wanted to make about privatization and the "revolving door" of Washington.

Like many of you I only know of an entity called Blackwater from the reporting of Jeremy Scahill. Now the Blackwater organization is called the Z Corporation, I understand. Note the attempted splitting of the Self and dissolution of the Hyde aspect of the persona, implicit in the name change.

Blackwater is a private military contractor, who first entered the American public consciousness with the massacre of four contractors at the Iraqi city of Fallujah. Sometime after that an issue came up concerning accountability in the deaths of Iraqi civilians, and so on and so forth.

A spokesman for the company produced a statement to this approximate effect: we can't be held civilly responsible for anything because we are part of the total U.S. force; but the Uniform Code of Military Justice cannot be applied to us because we're civilian contractor.

Its after midnight so we'll look at this tomorrow.

wingedcentaur

Good Afternoon Friends,

So, the New Money/Old Money dynamic we've been discussing, is crucial to our analysis of the ruling class's relationship to "free market" capitalism. Underpinning all - and I can't say this enough - is the simple Existential (also Buddhist, if it comes to that) truth: Man is the desire to become God.

New Money always wants to become Old Money just as quickly as possible. Remember in the Mario Puzo novels and movies he co-wrote, The Godfather and The Last Don, both Vito Corleone and Dominico Clericuzio wanted to move their mob families further and further away from anything like street crime. They wanted to entrench themselves more and more deeply in the legitimate world of power and commerce to make themselves politically and legally untouchable.

In the second Godfather novel, The Godfather Returns, Don Vito's successor, his son Michael explicitly states what his goal is. He wanted to arrange things so that eventually, the name Corleone would mean the same thing to most people as the name Rockefeller, Carnegie, Mellon, Morgan, and the like.

We see that in the Godfather III, which I understand Francis Ford Copolla had orignally wanted to call The Death of Michael Corleone, Michael Corleone has indeed realized the epitome of the "American Dream," receiving a medal from the pope, and running an organization - complete with a suave and tanned George Hamilton as his personal assistant - that is rather like any big legal corporation with diversified interests, and so forth.

In The Last Don novel and movie, in which Danny Aiello brilliantly played Don Clericuzio, the don met with his inner circle of the organization and said, "Twenty, thirty years from now, we'll all disappear into the lawful world, and enjoy our wealth without fear."

This was the goal. It's important to understand that with the Corleones and the Clericuzios, there was never any question of "going straight," or "legit." There is no question of repentance. Both dons believed that embedding themselves in the lawful world was far more prudent than indefinitely continuing with the unvarnished mafia thing.

New Money always wants to become Old Money as quickly as possible, whether we looking at a legitimate businessman or an international drug dealer. Clericuzio sought to become Old Money by shedding his organization of all their interests in all criminal interests - which he distributed to other mafia dons, who were not nearly so far sighted - with the exception of gambling.

The Clericuzios worked political and other connections, angling and manuevering to bring about the day when gambling would be legal in all fifty states, which would mean billions a year to the Clericuzio, given the infrastructure they had patiently put down over the years. In this way the Clericuzio clan would become literally embedded in the state through government sanctioned gambling.

Vito Corleone had always concentrated on accumulating political power through a system of "friendship." He had always kept the Family out of the narcotics business. He seems to have found drugs personally distasteful, an "infamnia." But more important than this was Don Vito's view that the law would come down much harder on people selling narcotics than they would for liquor and women, which are things people want but are denied to them by ".. the pezzanovante of the church," and so forth.

Michael brought to fruition the plan Vito had nurtured in his heart all along. Remember the scene in the movie when old man Corleone is talking to Michael in the garden?

I'll continue with this later on.

wingedcentaur

Good Morning Friends,

I use the terms New Money and Old Money in two ways.

A) the traditional way: length of time wealth has existed in a family line

B) Individually: When I invoke someone like Warren Buffet or George Soros, I call them Old Money, in that they have been in the financial business a long time, have been two of the most successful at it of those who started out with them many decades ago, and they seem to be more personally serene in their wealth; in other words they seem to have been super rich long enough to seem as though they are comfortable with their fantastic god-like wealth - no matter what the economic circumstances they may have been born into.

This second level of wealth achieves transcendance - and therefore "Old Money" status, for our purposes - with its inclination and ability to achieve wildly disproportionate influence over the government.

This level of wealth uses the social power that accrues to it to influence government in four ways:

1. to get hugely anti-competitive, anti-capitalist in fact, subsidies, supports, tax breaks, tariffs against foreign goods, and the like; its ability to bully state governments by saying that if they don't get massive considerations they are leaving and taking every single one of those thousands of desperately needed jobs somewhere else more amenable, who will provide a more favorable business environment.

2. its ability to lobby the government for policies that specifically benefit itself, or defeat policies that would in the least way infringe upon their bottom line. Remember when Congress defeated a bill to make it easier for individuals to file for bankruptcy protection?

Take this "historic" healthcare legislation that President Obama seems poised to sign. It won't be single-payer, universal coverage. But one good thing is that, according to the rumors, insurance corporations will not be able to deny people coverage based on pre-existing conditions. But there are other rumors about a "mandate." People may be required by law to have health insurance.

But the state is not expanding coverage. The private corporations are getting tens of millions of new compulsory customers. In this way the private corporate apparatus will have embedded itself into the government, has become as inevitable and undefiable as the government itself. I will come back to this point.

3. its ability to position its "Old Wealth" capitalists as "wise old men" counselors to power (political).

Cast your minds back to the 2008 presidential campaign. I think it was just before the Iowa caucausus. Obama was under pressure to position himself as both a transformative agent of "change," a substantial, "serious" politician with "gravitas." Remember that word, 'gravitas?'

He made a speech somewhere and rattled off a list of luminaries that was advising him on policy during his campaign, the people "I associate myself with." Warren Buffet was one of the names on that list. Remember that Warren Buffet is one of the "Old Money" capitalist making nostalgic, and yes, reactionary, and vaguely sounding populist criticisms of "New Money" practices of 'derivatives' and so forth.

By getting on the "hope and change" team he was, by extension, able to be viewed, vaguely, over time, as such himself. So much so, it would seem, that a proven leftist like Ralph Nader can write a work of speculative fiction called "Only the Super Rich Can Save Us," in which Buffet, or some one like him, among many someones like him, is one of the heroes.

4. What are we to make of all of this privatization of government, everything from the military, intelligence functions, healthcare, of course, as well as education; I even heard there is/was a fully privatized town in Florida somewhere [I heard Naomi Klein mention this in a video clip on the Internet, as she was discussing her book, NoLogo]; and what about this "revolving door" of Washington we hear so much about? That is when government officials work government and with the connections they acquire they go into the corporate world. Then they go back into government again. Then they go back into private business......

As we make this analysis, here, and more broadly concerning the relationship of the ruling class to capitalism, let us keep in mind one of the main ideas of Existentialism, which has dominated this blog: Man is the desire to become God.

If we keep this in mind, I think it will help us resolve seeming contradictions in the behavior of the ruling capitalist class with respect to the practice of capitalism.

Here's the analysis: the corporate world - despite Grover Norquist's famous assertion that the goal of the right wing is to make government so small that it could be drowned in a bath tub - far from wanting to shrink government, far from just wanting to benefit from patronage, want to replace and become the government.

This is so of practicing members of the capitalist ruling class, as opposed to the purely ideological or theoretical, we might say, members of it in the media, think tanks, and the like.

However much we may think and know that government is under the thumb of moneyed interests, by their lights, they have a long, long, long way to go before they, corporations, become the government. If and when they finally achieve this, they will, at long last, be free of capitalism, which they do not believe in.

Old Money has, in a sense, transcended capitalism. New Money, as rich and powerful as they are, are still capitalist - which is why Old Money has historically found them distasteful.

I'll pick this up later.

wingedcentaur