Tactical Linguistics Research Institute

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Terror on the Airwaves

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Over the weekend, there was a security breach at JFK International Airport: a man, who fell off his jet ski, swam to shore, climbed an electric fence, and then walked across two runways to a terminal entrance.  With little effort, he was able to defeat a new, state-of-the-art, $100 million Raytheon security system.

As the experts took to the airwaves demanding that heads roll, the more profound question remains unexamined: if a $100 million security can be so easily defeated, why haven’t fanatical terrorists done so since September 11, 2001?

The simplest explanation is that there are few — if any — active terrorists in the United States who are interested in targeting airports.

Of the high-profile terror cases that have targeted other types of locations, many have been cases of entrapment.  In 2009, Hosam Maher Husein Smadi was arrested in Dallas; the other members of his “sleeper cell” were all Federal agents, who provided him with what he thought was a bomb.  In 2010, Mohamed O. Mohamud was arrested in Portland; after being identified as “a person of interest,” he was approached by several undercover FBI agents, introduced to a fabricated bomb plot, given instructions for building a bomb, and given $3000 for living expenses.  Also in 2010, a man with the alias Muhammad Hussain was arrested in Baltimore after meeting a paid informant, who led the man to an undercover FBI agent with a fake explosive.  In 2006, the FBI broke up a cult in Miami, and the media packaged it as the Liberty City Seven Terror Plot; the group to which these men belonged was infiltrated by two paid FBI informants, who hired an additional infiltrator.  The FBI also paid the rent for their meeting place and arrested the men when they tried to buy weapons from the FBI; their first two trials ended in a mistrial because the jury could not reach a verdict.

In 2004, Federal agents broke up the Detroit Sleeper Cell: four men went to Disney World, where they recorded some amusement rides; a fifth man, who had plead guilty to credit card fraud and identity theft, earned a reduced sentence by testifying against the other four men, two of whom were convicted.  After these convictions were overturned, the Washington Post reported in 2005: “In its best light, the record would show that the prosecution committed a pattern of mistakes and oversights that deprived the defendants of discoverable evidence … and created a record filled with misleading inferences.”  That many of these cases rely on paid informants underscores serious problems with the approach, which incentivizes the creation of the appearance of criminality: for example, one such FBI informant, Craig Monteilh, made $177,000 working for the FBI — tax free — in just over a year (the median household income in the US is just over $50,000).   Without the encouragement of the FBI or paid informants, it seems unlikely that any of these people would have made any serious or successful attempts to disrupt the lives of Americans.

It might be argued that these people, nevertheless, harbored hostile sentiments toward the United States, and that we’re better off without them.  Aside from the problems associated with such ends-justify-the-means thinking, however, is a more basic problem of priorities: reckless bankers and speculators harm Americans, but they walk free.  Enron collapsed over a decade ago and the LIBOR affair has been unwinding for years: if entrapment tactics are legitimate, why don’t we see the FBI entrapping crooked accountants, or CEO’s engaged in fraudulent schemes, or bankers who launder drug money, or investors who gamble with the retirement accounts of hard-working Americans?

It might be argued that these so-called terrorists represent only the high-profile cases, and that, due to national security concerns and the need to protect “sources and methods,” we don’t hear about the many smaller cases that are successfully prosecuted.  The plea of “state secrets,” however, is often little more than a justification used to avoid oversight: our enemies often already know they’re being targeted, and it is taxpaying Americans who are kept in the dark.

During World War II, the Germans and the Russians knew about the Manhattan project before Americans learned of it.  Cuba knew we invaded their island, even when this information was kept from Americans; Fidel Castro even complained to the UN that he was being targeted.  Cambodians knew they were being carpet-bombed even when this was being kept secret from the American citizens financing the bombing.  Russia knew about the U2 spy plane well before Americans learned of it.  Everybody involved in the Iran-Contra affair knew of US involvement well before Americans learned of it.  The very nature of such “state secrets” justifications prevents us not only from knowing if any such smaller cases exist, but moreover prevents us from knowing whether they represent legitimate prosecutions, or cases of questionable conduct.  If there are smaller cases, it would seem that they have been treated as the criminal matters that they are, rather than as instances of organized international terrorism.

In any event, there is other evidence that terrorism is not treated as the priority it is made out to be in the news: the PATRIOT ACT, for example, which was passed in the wake of the 911 attacks, provides expanded powers for police to conduct “sneak and peek” searches.  Between 2006 and 2009, these PATRIOT ACT searches were used 100x more often in drug cases than in terror cases.

PATRIOT ACT provision used more often for drug cases than for terrorism cases
At present, it seems like a good possibility that the “War on Terror” is simply a substitute for the military and industrial subsidies put in place during the Cold War.  Now, instead of a shadowy global network of communist infiltrators, we face a shadowy network of “al Qaeda franchises.”  Just like McDonald’s or Starbucks, an al Qaeda “franchise” may be lurking around any city street corner.

If we are to extract any major lessons from the Cold War, it should include these: first, if, during the Cold War, the world had two powerful, ideologically-motivated governments each struggling for the global dominance of its ideology, and each was willing to destroy the entire planet with weapons of mass destruction for the sake of that struggle, it is a dubious “victory” for humanity that either side should come out on top.  Second, we should remember that, despite the “duck and cover” drills and media propaganda about Soviet nuclear attack, the only radiation to which Americans were exposed during the Cold War came from the American government itself: atmospheric tests in the Southwest and over the Pacific Ocean, a cloud of strontium-90 floating over the US in the late 1950’s, soldiers used as guinea pigs, prison inmates and the mentally ill deliberately and secretly injected with radioactive material…

Guns are abundant in the United States, and easy to acquire; yet, there have been no terrorist shooting sprees.  If a terrorist were willing to die for his or her cause, it would not be hard to take out several Americans too.  Former “Freedom Fighters” in Afghanistan seem to have little difficulty constructing improvised explosive devices, but jihadis stateside seem wholly incapable of this feat when removed from an impoverished desert environment swarming with US military personnel.  A terrorist could drive a car into a crowd, or sit in a boat by an airport with a high-powered rifle; if a terrorist wanted to disrupt American life, that terrorist could drive cross-country in the middle of the night attacking high-tension power lines without being caught.  If any of these things were happening with the regularity that would justify something like the PATRIOT ACT or a new bureaucracy the size of the Department of Homeland Security, “state secrets” wouldn’t be able to keep it out of the news for very long.  And yet, for over a decade now, we’ve remained under the same state of emergency declared by George W. Bush.  President Obama has repeatedly extended this state of national emergency.  Congress is required under the 1976 National Emergencies Act (50 U.S.C. 1601-1651) to review presidential emergencies every six months; this oversight, however, does not appear to be much of a priority, and Congress has not been actively reviewing this emergency declaration.

In the US, terror is spread almost exclusively by the media.  Most people traumatized on 911 were traumatized by watching TV in their kitchen or school classroom.  Whereas terrorists have killed around 3000 Americans in the past decade, in the same period, automobiles have been responsible for some 400,000 deaths.  The typical American is astronomically more likely to be killed or injured in a car accident than in a terrorist attack; yet, rather than treat effective mass transit as a life-saving national priority, politicians like Wisconsin Governor Scott Walker make a show of turning down $1 billion in Federal funds for commuter rail.

In an important sense, we are our own worst enemy: Congress and the President have done more to disrupt the American Way of Life than any terrorist could have hoped to accomplish.  As the media obsesses over dramatic fictions, as the federalization of local law enforcement continues, as local police procure military hardware, as civil liberties are swept aside, as drones and dirigibles with high-resolution cameras appear over major urban centers, keep in mind that it is not just Muslims that are targeted: during the recent G-20 summit in Toronto, police have been accused of profiling protestors with “black backpacks” and women with “hairy legs.”  A Canadian police watchdog group calls these claims “substantiated.”  Over 1,000 protesters were arrested — mostly without charge — and only around 40 were successfully prosecuted.  Police profiling isn’t strictly a religious or an ethnic issue: control freaks don’t discriminate.  If they don’t come to lock you up in person, be sure that they’ll come for your heart and your mind.

Written by Indigo Jones

August 14, 2012 at 1:58 pm

Modern Libertarians and Corporatist Totalitarianism

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The term “libertarian” was first used by Joseph Déjacque in 1857 to describe a particular brand of anarchism.  I have discussed elsewhere the extent to which modern libertarianism represents a perversion of classical anarchist thought.  The extent to which this modern, impoverished view represents a clear and present danger to law and order deserves added emphasis.

Modern libertarians, in their criticism of the possibility that government action might distort market factors, consistently neglect to consider the extent to which industrial corporations distort market factors through the formation of monopolies and oligopolies.  Former Federal Reserve Chairman Alan Greenspan even went so far as to criticize anti-trust legislation on the grounds that “No one will ever know what new products, processes, machines, and cost-saving mergers failed to come into existence, killed by the Sherman Act before they were born. No one can ever compute the price that all of us have paid for that Act which, by inducing less effective use of capital, has kept our standard of living lower than would otherwise have been possible.”  Greenspan later acknowledged that his views contained a “flaw,” and expressed “shocked disbelief” that the banking sector failed to self-regulate.

For many industries, monopoly and oligopoly are the default market arrangements: consider Monsanto in the US soy market, Intel in the computer chip market, or the typical cable tv market, for example.  These are not isolated cases, but represent a pervasive form of corporate organization at the industrial scale.  Wherever producers are able to dictate prices, rather than rely on the signals sent by consumer purchasing decisions, producers exert coercive pressure on consumers, and market forces do not operate properly.

Given that industrial scale corporations control far more wealth and resources than the government, industrial scale corporations would seem to pose a more significant threat to individual liberty than government.  And, given the libertarian opposition to growth in government as a source of coercive influences, a self-consistent libertarian position should hold the growth of monopoly or oligopoly to be a considerable threat as well.  Given that modern industry is largely characterized by monopoly and oligopoly, a self-consistent libertarian position, therefore, would hold economic growth itself to be highly suspect.  In railing against regulation, however, modern libertarians neglect the threat posed by industry, and in effect, facilitate the growth of oligopoly.

This myopic character of modern libertarianism can be seen operating behind conservative opposition to “Obamacare,” which conservatives believe represents a government over-reach into the health care market.

The government’s intervention in health care isn’t an intervention in the free market, however, because the US health care industry isn’t governed by market forces. Take prescription drugs, for example. Each pharmacy pays a different price to the pharmaceutical company. Depending on the insurer, each consumer pays a different copay to the pharmacy. The consumer often doesn’t know the retail price of the drugs, and the prescribing doctor doesn’t know what the patient’s copay is. The price system only works when consumers — not producers — set the price. If consumers don’t know the price, their purchasing decisions don’t serve as signals to producers.

don't steal from medicare to support socialized medicine

The health insurance industry in the US is best characterized as an extortion racket. Government mandated health insurance is a problem, but not for the reasons conservatives identify.  The problem is not government interference in the market because there is no market. Because conservatives have the wrong diagnosis, their prescription for a cure is also wrong.

Free market thinker Friedrich Hayek, in the Road to Serfdom, saw monopoly as the proximate cause of modern totalitarianism.  On page 194, he observes, “This movement is, of course, deliberately planned by the capitalist organizers of monopolies, and they are thus one of the main sources of this danger.  Their responsibility is not altered by the fact that their aim is not a totalitarian system but rather a sort of corporative society in which the organized industries would appear as semi-independent and self-governing ‘estates.’ … A state which allows such enormous aggregations of power to grow up cannot afford to let this power rest entirely in private control.”

Written by Indigo Jones

May 1, 2012 at 3:44 pm

The Intellectual Poverty of Modern Libertarianism

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Congressman and presidential candidate Ron Paul has assumed the mantle of modern crusader for the Libertarian cause.

His campaign website claims: “Dr. Paul is the leading spokesman in Washington for limited constitutional government, low taxes, free markets, and a return to sound monetary policies based on commodity-backed currency.”

The modern Libertarian position, however, has a number of striking shortcomings that become even more pronounced when situated within the historical context that gave rise to the political philosophy of Libertarianism.

Limited Constitutional Government

While it is true that the scope of the US government has expanded over time, this isn’t an inherently negative thing.  During George Washington’s Administration, 80% of the federal budget was dedicated to Indian eradication.  In this sense, national security is the oldest subsidy program in US history; at the same time, it’s encouraging to consider that the government has largely abandoned systematic genocide and, throughout the Progressive era, dedicated itself to ways of promoting “the general welfare” and creating “a more perfect union” by extending voting rights to women and blacks.

Moreover, there is little historical evidence to suppose that the US government was originally meant to be limited in scope.  This may be a Jeffersonian ideal, but is just that: idealism.  Insofar as it is believed as historical fact today, it represents a form of popular mythology.

In the Federalist #14, James Madison wrote:

“If Europe has the merit of discovering this great mechanical power in government, by the simple agency of which the will of the largest political body may be concentrated, and its force directed to any object which the public good requires, America can claim the merit of making the discovery the basis of unmixed and extensive republics. It is only to be lamented that any of her citizens should wish to deprive her of the additional merit of displaying its full efficacy in the establishment of the comprehensive system now under her consideration … Let it be remarked … that the intercourse throughout the Union will be facilitated by new improvements. Roads will everywhere be shortened, and kept in better order; accommodations for travelers will be multiplied and meliorated; an interior navigation on our eastern side will be opened throughout, or nearly throughout, the whole extent of the thirteen States. The communication between the Western and Atlantic districts, and between different parts of each, will be rendered more and more easy by those numerous canals with which the beneficence of nature has intersected our country, and which art finds it so little difficult to connect and complete.”

The framers planned on territorial, technological, and infrastructure expansionism from the outset.

In the Federalist #10, Madison concluded:

“The question resulting is, whether small or extensive republics are more favorable to the election of proper guardians of the public weal; and it is clearly decided in favor of the latter.”

Low Taxes

The vehement support of low taxes among modern Libertarians is predicated on the assumption that this is money taken away from citizens.  This is short-sighted in the extreme.  When the government takes in money in taxes, it spends it.  Corporations and wealthy CEO’s, on the other hand, do take money out of circulation.  They put their surplus profits in banks, so banks can turn around and create more money through the fractional reserve system, which leads to inflation, which harms typical workers who have seen wages stagnate even as worker productivity has steadily increased.  But corporations and wealthy individuals who invest their money aren’t spending it; they aren’t contributing to the “real economy” the way government does when it allocates revenues.

graph of worker compensation compared to growth in productivity

Citizens benefit from government spending.  The west was not won by strong individualists in combat with the wilderness; the west was won through government subsidies promoting the expansion of railroads, the telegraph, and through land grants.  The westward expansion was the government-subsidized expansion of new technology.

By GDP, one third of government spending is dedicated to the armed forces.  This is a continuation of our oldest subsidy program: national security.  Since World War II, the permanent war economy has required a certain type of economic growth; during the Cold War, this took the form of planned obsolescence, which served the function of battlefield attrition in the context of a war without fighting.  A large military provides important technological subsidies that the economics of growth capitalism require.

Free Markets

This is perhaps among the most pernicious of myths propagated by modern Libertarianism.    By GDP, business accounts for about 75% of US economic activity.  Yet entrepreneurialism accounts for only 1/7 of that.  That means most economic activity in the US is on the scale of industry.

Industrial scale commerce is characterized by organizational prowess, not entrepreneurial initiative. Most of what the industrial firm calls planning is precisely the elimination of market forces: Sony sells Playstations at a loss to undermine competition; Microsoft was fined $2 billion by European regulators for operating in open violation of EU trade laws over the course of a decade. If such tactics fail, an industrial firm will buy its competition outright. Buying firms is also a way for the industrial firm to enter a new market. From the perspective of the industrial firm, acquisitions assume the role of innovation, which is otherwise impossible where planning foresees outcomes. There is only competition where outcomes are uncertain: that is what a competition is. Entering a market a new by purchasing a successful firm is anti-competitive; but shareholders want a predictable return on their investment, so investors favor industrial planning over entrepreneurial initiative.

The modern industrial system is characterized not by competition, but by oligopoly. In a given market, you have one choice of cable provider. Intel makes 85% of the CPUs sold in computers today. 90% of the soy grown in the US is Monsanto Roundup Ready.  ADM processes 50% of domestic corn ethanol.  These are not isolated examples.  General electric makes NBC sitcoms and nuclear weapons: the intuitions of the entrepreneur have about as much validity with respect to industry as observations about a piggy bank have with respect to the fractional reserve system.

Despite the rhetoric of free markets, most economic activity in the US is the result of industrial-scale economic planning.

There is no free market where there is no competition; in industry, there is little meaningful competition.  The price system only works if producers have no control over pricing; under oligopoly, it is precisely producers rather than consumers that determine prices.

The era of entrepreneurial capitalism vanished in the 19th Century, eclipsed by monopoly capitalism and again by the permanent war economy.  There’s no going back, unless you’re willing to do without industry.  Even the entrepreneur is a tool of industry: a purchaser of computers, media, manufactured furniture; independent retailers sell industrial goods.

The very notion of a free market is antiquated idealism.

Sound Monetary Policies

While there is plenty to criticize about fractional reserve banking, a return to a commodity based currency like the gold standard is not a viable solution.  The value of a currency tied to the price of gold can easily be manipulated by wealthy individuals or organizations hoarding the available supply, leveraging scarcity to their advantage.

Where fractional reserve banking creates opportunities for abuse, the solution is increased government regulation which puts limits on how much money banks are able to create, and under what circumstances.

Practical Issues

In their efforts to dismantle the public sector, modern Libertarians overlook several important key points.

First off, the effort to privatize government services on the assumption that markets are more efficient neglects to consider that markets are more importantly characterized by competition. Do we really want competition for what rights we are guaranteed? Isn’t this at odds with the very concept of the Bill of Rights as representing “inalienable” rights? If a competition is fair, its outcome is unpredictable: market mechanisms are therefore a poor way to guarantee rights.

Second, in an industrial economy, a large public sector is essential to ensuring aggregate demand. An important feature of the public sector is that employees are neither rewarded in good times nor penalized in hard times; this allows industry to plan effectively.

Third, modern libertarians are in agreement with Demcorats, Republicans, and industrialists generally in assuming that a certain type of growth capitalism is good. This, however, requires enormous subsidies and a large source of aggregate demand.  The demands of growth capitalism also overlook the fact that we live on a planet with finite resources, and we cannot grow indefinitely.

Fourth, modern libertarians obsess about government intervention as a source of market distortion, but never mention oligopoly.  Firms like Microsoft routinely engage in anti-competitive business practices in the US and abroad. They treated this as just another business expense on the road to market domination.  Oligopoly does far more to distort markets than typical government regulatory activity.
Philosophical Issues

Modern Libertarians might be right that our current government is a problem, but they have the wrong diagnosis and consequently the wrong prescription. They would never cite rising divorce rates as evidence that the institution of marriage should be abolished, but this is just the approach they take to government. They inadequately identify the specific dynamics that have lead our government to become so grossly dysfunctional.

Debates about too much to too little regulation miss the historical context in which our government was instituted: the Lockean tradition, which was largely concerned with property, held property as subject to regulation by the state.  “Life, Liberty, and the pursuit of Happiness” is a repurposing of Locke’s “life, liberty, and property.” In his Second Treatise on Civil Government, Locke wrote:

(se. 120) “it would be a direct contradiction, for any one to enter into society with others for the securing and regulating of property; and yet to suppose his land, whose property is to be regulated by the laws of the society, should be exempt from the jurisdiction of that government, to which he himself, the proprietor of the land, is a subject.”

Furthermore, Friedrich Hayek‘s “free market” program, spelled out in The Road to Serfdom (in which he also voiced opposition to laissez-faire capitalism), is quite compatible with a public health care system. After noting that “The functioning of a competition not only requires adequate organization of certain institutions like money, markets, and channels of information — some of which can never be adequately provided by private enterprise” (38) he asserts that “there can be no doubt that some minimum of food, shelter, and clothing, sufficient to preserve health and the capacity to work, can be assured to everybody” (120).

He continues:

“Nor is there any reason why the state should not assist the individuals in providing for the common hazards of life against which, because of their uncertainty, few individuals can make adequate provision. Where, as in the case of sickness and accident, neither the desire to avoid such calamities nor the efforts to overcome their consequences are as a rule weakened by the provision of assistance — where, in short, we deal with genuinely insurable risks — the case for the state’s helping to organize a comprehensive system of social insurance is very strong” (121).

The Intellectual Poverty of Modern Libertarianism

The rhetoric that modern Libertarian thought borrows from classical anarchism neatly ignores the economic equality imperative that anarchists considered to be inseparable from absolute individualism.  Modern Libertarianism also glosses over the bitter disputes between Marxists and anarchists: there is a tendency to view Communism as monolithic and as opposed to pure Capitalism; yet anarchism represents a third position, opposed to both Capitalism and Communism.  Under the anarchist critique, for example, Communist China can be seen exactly for what it is: not a Communist enterprise in any substantive sense, but rather, as a variety of state capitalism.

Written by Indigo Jones

January 15, 2012 at 5:39 pm

Plutocracy, Oligarchy, and the Myth of Free Markets

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The Occupy Philosophy blog recently posted an article about “plutocracy,” or rule by the wealthy, written by Brian Leiter, Director of The Center for Law, Philosophy & Human Values at the University of Chicago.  In his commentary on American plutocracy, Leiter asserts that “at historical moments pregnant with the potential for significant social and economic change, the choice of language sometimes matters.”  In light of these premises, let us examine his position.

Leiter identifies “plutocracy” as the primary ill in the modern United States.  He asserts that “plutocrats” have undermined democracy.  He states that “the United States is the most powerful ‘plutocracy’ in the world. It is no longer a democracy.”

To be precise about our “choice of language,” the United States Constitution guarantees a republican form of government, not democracy; and, insofar as the law originally limited political participation to white, land-owning males (the capitalist class), the United States has always been a plutocracy.

But the more profound problem with Leiter’s argument lies in his particular invocation of “plutocracy” as the source of the problem: to equate wealth with power does nothing to explain how wealth translates to power, but simply assumes this as a fact.  This, in one sense, amounts to simply stating the obvious.   It is like pointing out that businesses are run by businessmen, without discussing at all what varieties of business are present, how they operate, or how they are integrated with or, as the case may be, antagonistic to society at large.

I. Whither Capitalism?

Leiter begins by observing that “we are now in the fourth year of the worst economic catastrophe in the capitalist world since the Great Depression.”  While this, at first glance, may appear uncontroversial, some qualification is needed with respect to the use of the term “capitalism.”  Not only are there ideological disputes at issue, but historical conditions which are, on the whole, inadequately addressed in contemporary discourse.

The late 19th Century, in which wage labor became a dominant mode of subsistence, brought about radical changes in the nature of capitalism as industry became increasingly institutionalized and bureaucratized.  The entrepreneurialism of the revolutionary bourgeoisie gave way to a commingling of private and public bureaucracy — of capital and political power — and set the stage for the working conditions of the early 20th century.

It was here we saw the ascendency of the labor union as a serious political and economic power.  The antagonism of government to unionization was a result of the union’s encroachment on the management prerogatives of industry (that is, the setting of wages and working conditions). The state, acting on behalf of capital, revealed the presence of the close-knit connections between political and industrial power that had developed during the second half of the 19th Century.

By the middle of the 20th century, this trend continued to the point where, what had traditionally been called “the market” had ceased to be a relevant force in the dominant culture of the United States.  Classical liberalism assumes that capital (land and machinery) is fixed, while labor is flexible.  Industrialization caused mass migrations of labor from farms to urbanized areas, and workers readily acquired new skills to adapt to different types of labor.

As labor has become increasingly specialized, as two-income households have become more common, and as benefits have become an increasingly important part of employee compensation, labor has accordingly become less flexible.  At the same time, capital has moved overseas, and become more flexible.  By the end of the 20th century, the traditional relationship between capital and labor had been well inverted.

Today, when one uses the term “capitalism,” this term means different things to different people.  The American conservative uses the word to invoke a nostalgic vision of 19th century entrepreneurialism.  The American liberal typically uses the word to indicate a mode of collectivist action wherein professional managers control the means of industrial-scale production on behalf of absentee owners.

There is an important sense in which even Nazi Germany was a capitalist country.  To be sure, it wasn’t market capitalism — any more than market capitalism prevails in the United States today — it was a form of monopoly capitalism that took the State as the primary consumer, and which used an imperialist war of expansion to organize production.

Although the official ideology of the Nazi Party espoused a socialist organization of society, the Nazis did very little to restructure private property or private profit along the lines of socialist ideology (except for the expropriation of Jewish wealth, which was handed over to industrialists and bankers).

Between World War I and World War II, German industrialists were a key component to the German rearmament, and the same German industrialists were the key beneficiaries of the war economy.  The industrialist Fritz Thyssen, for example, was a central financier of the Third Reich, as was the Association of German Industrialists.  The automobile manufacturer Volkswagen was a private corporation that produced automobiles for the Third Reich.  Max Amann profited enormously as a publisher of Nazi propaganda.  The Zyklon B used in Nazi gas chambers was a commercial product.

Insofar as the Nazi economy was characterized by a vast agreement between industrialists and politicians, it is worth noting that American business and government alike agree that growth is the key to success.  This is despite the fact that we live on a planet with finite resources, the exploitation of which is characterized by diminishing returns, and that increases in worker productivity are of only marginal benefit to workers themselves, who have been seeing their compensation stagnate or diminish for quite some time.  It is government and industry agreeing that growth is of the utmost importance for the industrial-scale corporation.

II. Who Competes?

The typical American conservative will construct a binary opposition between capitalism understood as “free markets” and socialism understood as “economic planning.”  This is, however, a false dichotomy.

The modern corporation is largely defined by organizational prowess, and insofar as these organizations are risk averse, the chief market operations of the industrial firm are actions meant to eliminate market forces.  This is called planning.  A farmer in the midwest can be fairly certain of finding the fertilizer he needs when he needs it precisely because modern corporations are expert planners.

Stability is the enemy of competition (which must be unpredictable if it is to be fair), and insofar as corporations want to guarantee favorable performance for their shareholders, they set out to ensure economic stability and predictable growth.  Marketing and advertising are means to ensure consistent demand.  Corporations will sell their products at a loss to undercut competitors, and if this fails, they may buy their competition outright.

Because executives rarely go to prison when corporations break the law, corporations are apt to operate in open violation of the law if it will snuff out the competition — this is precisely what Microsoft did in Europe, paying $2 billion in fines during a decade of operation in direct violation of EU trade laws.  Corporations that pollute are granted enormous subsidies: given that most homes and businesses must pay for garbage collection, why should the biggest polluters be exempt to the extent that they are?  Insofar as schooling prepares students for employment, and college trains students in industry-standard skills and software applications, the cost of education represents a form of subsidy.

The result of this relentless push by modern industry to eliminate market forces at every opportunity has a profound impact on daily life — albeit one that is difficult to perceive at first glance.  Although there are many channels to choose from on television, most markets are served by a cable TV monopoly.  Although a consumer has many different brands of computers available to them for purchase, one firm — Intel — makes most of the chips in these computersA few large firms make most of the hard drives and optical drives in these computers.  Microsoft makes the operating system for most of these computers.  Computers are highly commoditized, and relatively few firms control the market for this commodity.

This dominant market arrangement is known as oligopoly, and is characterized by collusion between a few major firms to mutually ensure their continued dominance.  And it is not just the the cable television market or the technology sector that is characterized by this arrangement: as of 2005, 90% of the soy crop grown in the US was of the patented Roundup-Ready variety sold by Monsanto.  One company — Archer Daniels Midland (ADM) — claims close to 50% of the domestic market for ethanol.

US Government mandates that gasoline be blended with ethanol increased ADM’s net earnings by 26% in 2006 alone.  This is just one way in which ADM is the beneficiary of subsidies and governmental planning.  ADM also benefits from agricultural subsidies for corn, since most of the ethanol it produces is made from corn.  In 1993, ADM was also the target of the largest price-fixing case in US history.  It’s not just Microsoft that engages in anti-competitive business practices.

The demand for ethanol in gasoline, from which ADM benefits so enormously, is predicated on access to roads.  Roads are heavily subsidized.  For federal highways to be financially solvent, for example, the federal gasoline tax would need to be raised by 40¢ per gallon.  The federal gasoline tax was last raised by a nickel in 1993 — and whatever proceeds might be had from that increase have been consumed by inflation.

Not only are roads heavily subsidized, but the research that goes into advanced biofuels represents a subsidy as well: it could be argued that, given the economic law of diminishing returns, the money spent researching biofuels could be better spent investing in various forms of mass transit (though this would make the unpleasant implication that the American way of life is, as presently constituted, unsustainable — so politicians say what they must to get elected, and corporations keep giving consumers whatever marketing departments tell consumers they want).

None of this has happened by chance: the market is not an anarchy of small entrepreneurial firms as it was in the first half of the 19th century.  What we have in the West today is the result of planning.  Given that most wealth in the US is held by corporations, not plutocrats or governments, it is fair to say that most of the decisions about the US economy are the result of planning, since the modern industrial corporation is characterized by planning (that is, collusion with related firms and with government) rather than market competition (or voter turnout).

What is Excessive about CEO Compensation?

Although Mr. Leiter is content with the populist appeals of the Occupy Movement, which hold that excessive CEO compensation is the result of “avarice,” the truth of the matter is more subtle.  The problem of CEO compensation is not one of avarice, but, rather, is a particular solution to the personnel needs of the industrial corporation.

Most CEO’s are already wealthy by the time they are recruitedPay itself is not an incentive to work because they have neither fear of privation nor need for additional material comfort.  There are, then, two main approaches to providing them an incentive to work: psychological identification with the goals of the firm, or increased status.

Where CEO’s are recruited, rather than obligated to claw their way up through middle management, it is more difficult to get them to identify with the goals of the firm.  In certain industries this can be accomplished through an identification of the goals of the firm with specific social objectives (such as national defense), or through the dogma of indefinite growth (which even a tobacco company executive can participate in, and thereby contribute to society) — and it is here that a peculiar brand of nationalism comes into play — but in general it is easier to equate wealth with status, and motivate the CEO by enhancing his or her status accordingly (also satisfying the contemporary quantitative mindset).

And so growth becomes a central feature of American capitalism — providing both a psychological justification for those who manage industry on behalf of absentee owners (whose status derives from the circumstances under which they need only sit back and watch the money roll in) and what enables the firm to confer a form of status on the CEO.  It is through this fixation on growth that modern capitalism takes on an imperialist aspect.  It is moreover worth noting in this connection that the CEO is no more a capitalist than the typical pro-business unionized auto worker: the CEO is management, not a an individual proprietor, and is not inherently interested in the amassing of capital.

Of course, to the 99%, the CEO’s are, so to speak, high-status (in addition to being upper-class).  But what is often ignored is the extent to which they inhabit a completely separate social world with completely distinct norms.  There is, among industry, politics, and the military, a distinct affinity group — a set of shared goals, management practices, and close social ties.  You can see evidence of this affinity group where people who attain this status are able to move easily from one sector to the other.

Take former Vice President Dick Cheney, for example: he went from Secretary of Defense (military) to CEO of Haliburton (industry) to Vice President of the US (electoral politics).  It is not the case that the object of the work in any one occupation directly qualified him to occupy the other, especially in this era of specialization.  Yet what Cheney specialized in were certain management practices, bureaucratic proficiencies, and the cultivation of a specific social network.  His case is not an isolated one.

The personnel problem becomes a social problem where these people, who aren’t always the wealthiest, but who have access to authority and the media, set about normalizing the persistence of the affinity group from which they benefit.  It is not a matter of some wealthy folks being “well-intentioned” while others are “sociopathic” — though many in positions of power do exhibit sociopathic personality traits.  There is, more substantively, the important matter of why so many Americans go along with things.

Many Americans see collusion as waste and arrive at the conclusion that government should be run like a business, without ever stopping to think for half a second about what that means.  Many people believe that if government were run more like a business, it would work more efficiently.  If government were to hold efficiency to be of paramount importance, it would simply kill the infirm, rather than offer Social Security.  This is, of course, contrary to the US Constitution’s promise to “promote the general welfare,” understood as a means of guaranteeing “life, liberty, and the pursuit of happiness,” but markets, by definition, offer few guarantees.  It is a very circumscribed definition of “efficiency,” but one that highlights why “playing the stock market” is often equated with gambling.  Sometimes the bottom line isn’t the bottom line.

There are other problems with holding that government should be run like a business.  Businesses are not democratic organizations, they are authoritarian (you do what your boss tells you to do, and you don’t get to vote your boss out of office if you don’t like it); their management practices are in many cases proprietary (as opposed to publicly announced laws) and their office holders are appointed, rather than elected.

Furthermore, there are reasons to suppose that the ethical standards of conduct with respect to business and government are incompatible. Whereas a business man must be on the lookout for opportunities to engage in commerce, when an office holder does this, it’s called bribery or a conflict of interest.

Business (of the desirable, market-based kind) needs competition, but government needs loyalty. It doesn’t even make sense to think of government as competing: the whole point of a constitutional republic is that the state has a monopoly on the legitimate use of force as a means of coercion; the alternative is vigilante justice.

And What of it?

Where the notion that business represents a superior model for governance coincides with the ideology of political freedom deriving from economic freedom, it is worth noting that the sort of absolute freedom advocated by American conservatives is not the pinnacle of civil society, but its complete opposite.

In John Locke’s Second Treatise on Civil Government, published 1690, he states: “where there is no law, there is no freedom: for liberty is, to be free from restraint and violence from others; which cannot be, where there is no law: but freedom is not, as we are told, a liberty for every man to do what he lists” (57).  Liberty is having assurances everybody obeys the same law.

Laissez-faire economics is contrary to the Western Constitutional tradition, as originally conceived, and as understood in the mid 20th century.  Some centuries after Locke, in 1944, free market advocate Friedrich Hayek echoed much the same position, in articulating his view of rule of law: “The Rule of Law thus implies limits to the scope of legislation: it restricts it to the kind of general rules known as formal law and excludes legislation either directly aimed at particular people or at enabling anybody to use the coercive power of the state for the purpose of such discrimination. It means, not that everything is regulated by law, but, on the contrary, that the coercive power of the state can be used only in cases defined in advance by the law and in such a way that it can be foreseen how it will be used” (Road to Serfdom, Chapter 6).  Provided that individuals have a say in what laws are passed, freedom is having to obey only the law, and not yield to the whims of others.

The contemporary trend to privatize governmental services, then, is contrary to the goals of a just, democratic (or, republican, as the case may be) society.  It takes public resources and removes them from democratic control, under the banner of re-instating some nostalgic, 19th Century vision of entrepreneurial capitalism.

Of course, we have the benefit of history to tell us what that style of capitalism leads to: 15 hour workdays, no weekends, sweatshop conditions, mere subsistence pay, occupational safety hazards, and the like.  Union organizers fought tooth and nail for decent working conditions.  And already we can see both how far we’ve slid back into these precise conditions, and how they represent not the cooperation of individuals under the law, but the subjugation of individuals to what working conditions employers dictate.  This is an issue of no small concern, given that most people spend the better part of their waking hours for the better part of their lives working.

Say Again?

Where Mr. Leiter explains, “The social and economic world is both vast and complex, and in market economies, all the incentives of daily life demand focus on the immediate moment: closing this deal, getting to this business meeting, pleasing that client and, overridingly, getting what you can for yourself,” he is guilty of a gross over-simplification.

The very existence of government subsidies favorable to industry speak to the fact that these firms plan quite far ahead, and the lengths to which they go to undermine competition speaks to the extent to which they are averse to market participation.  The flaw here is the assumption that the conditions of a market economy are a relevant factor in shaping the shared goals of industry and politics.  These conditions do not prevail; rather, monopoly and oligopoly prevail.  There may be competition among filling stations and convenience stores or fast food restaurants within a particular neighborhood, but, the franchise agreements under which these small operators open up shop, as elsewhere, insulate the oligopoly from the risks of actual market participation.

Written by Indigo Jones

November 11, 2011 at 1:17 am

Follow the Leader: There is Opportunity in Disaster

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Although many elected officials lay claim to the title of “leader,” it is becoming increasingly self-evident that such a title only applies insofar as they are leading us off a cliff.  It is profoundly problematic that the media unquestioningly reinforces such baseless claims to leadership by routinely using so inappropriate a term to describe these officials.

While various “leaders” may market themselves as catalysts for social change, and seek to secure the confidence of voters who also seek social change, a change in “leadership” rarely brings about the promised social changes.  Not only is electoral politics first and foremost a means of legitimating those very power structures voters would seek to change, but belief in leadership is furthermore a tool to enforce conformity among voters, since following leaders is a form of conformity.  Conformists don’t bring about social change.

That few officials, out of humility, demure that they are not “leaders” but, rather, public servants, offers an important glimpse into a profoundly disturbing dynamic underlying the facade of “politics as usual.”

Many politicians are literally sociopaths. Compare the behavioral profile of the sociopath with the actions and attitudes of the typical politician: sociopaths don’t have normal moral reservations about manipulating people like objects; this is precisely how politicians get elected. Sociopaths understand little about human emotion beyond ego gratification; the prestige of high office satisfies this desire for the politician. Sociopaths wear a facade of normalcy and are often charming, but lie compulsively. Politicians speak in polite terms while plotting to stab their colleagues in the back. If they’re not telling outright lies, they’re “spinning” facts to suit their needs. Sociopaths don’t feel guilt or remorse or empathy; no US official to date has apologized for invading Iraq on false pretenses, turning five million Iraqi’s into refugees, pumping Fallujah full of depleted uranium, or engaging in torture.  Nobody in government has publicly investigated the Bush Administration’s use of torture or civil liberties violations. Sociopaths are glib, superficial, impulsive; their goal is the creation of a dependent, willing victim.  Elected office is the ideal job description for a sociopath.  The desire to attain office should disqualify a person from holding such a position.

The term “sociopath” is imprecise.  Often, “sociopath” is used interchangeably with “psychopath,” whereas other times, “psychopath” is used to designate a genetic predisposition, and “sociopath” a set of learned behaviors.  Either way, the prevalence of this sort of anti-social personality disorder among the general population is estimated at between 1-4%.

It may not be a coincidence that 1% of the population controls some 40% of the wealth in the US, and that the top 5% controls close to 70% of the wealth.   Competitive society is in many ways optimized to benefit those who exhibit sociopathic personality traits, and it reinforces sociopathic tendencies among the general population as a behavioral adaptation.

In competitive society, people are trained by sociopaths to think like sociopaths.  The public relations and marketing firms employed by both commercial and political interests train people to be opportunistic and calculating, to always be on the lookout for ways to treat other people as means that can be manipulated to various ends.  People are taught to be individualistic and egocentric rather than compassionate and cooperative.  Much of the advertising with which individuals are daily inundated promotes impulsive behavior and acculturates individuals to the distortions of reality that characterize most advertising and marketing.  As young people are brought into the fold, they become adults who are active participants in this process of training others to think like sociopaths — to think in the terms expounded by commercial marketers and political spin doctors — to such an extent that genuinely different worldviews become completely incoherent, in virtue of a sociopathic lack of empathy.

Beyond accommodating the lies and distortions that characterize so much advertising, marketing, and political posturing, individuals are, in numerous other ways, trained to think like sociopaths.  The aesthetic appreciation of violence in films, TV, and video games is an obvious example; a less obvious example is the popularity of “funniest home video” programs.

While slapstick comedy may be the cultural context in which “funniest home video” programs are appreciated, these programs contain none of the observational humor or physical ingenuity that characterize most slapstick.  The “funniest home video” programs are not, in any substantive terms, the products of creativity or skill.  They harvest moments of trauma from among the general population, and, in terms of their presentation, they train audiences to override natural empathy responses and to find humor in the misfortune of others.

Without an awareness of these dynamics, little can be done about them.  It is hard to criticize or correct a social trend without being able to even name it.  But such contemporary developments as the imposition of “austerity measures” or the renewed effort to disrupt labor organization and revoke “collective bargaining rights” can be understood in a precise historical context; to the extent that ordinary citizens support such measures, these citizens are being manipulated by criminal sociopaths.

In The Second Treatise on Civil Government, John Locke wrote, “he that in the state of society would take away the freedom belonging to those in that society or commonwealth must be supposed to design or take away from them everything else, and so be looked on as in a state of war” (¶19).  John Locke is not some fringe figure; the Preamble to the US Constitution is more or less a summary of Locke’s basic ideas on legitimate authority.  What is happening today has happened before, has been studied, and named, and diagnosed already.  In the past, monarchs caused civil unrest; today it is powerful sociopaths who have rigged the game to serve their own ends, who create for themselves an aura of respectability, and thus wrest from citizens assent to a degenerate state of affairs.

Written by Indigo Jones

October 19, 2011 at 4:28 pm

Connecting the Dots: the Past Didn’t Go Anywhere

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Nobody can rightly say the Bush Administration committed any crimes.

This is not because no crimes occurred; rather, there have been no investigations, and therefore no charges, and therefore no convictions.  But the abuses of the Bush Administration are not history.

We are still at war, we are still grappling with massive deficits, we still torture, we still submit “enemy combatants” to arbitrary systems of justice, we still subject US citizens to warrantless surveillance.  These things are current events, even if they began a decade ago.

Each year that goes by evidence is lost.  Memories cloud over, papers get misplaced, files are deleted, the news moves on to the next story.

Few of the “difficulties” brought up by the Bush Administration’s actions have been adequately resolved.  Here is one case study:

Kurt Friedrich Gödel was an Austrian logician, mathematician and philosopher. Later in his life he emigrated to the United States to escape the effects of World War II. One of the most significant logicians of all time, Gödel made an immense impact upon scientific and philosophical thinking in the 20th century, a time when many, such as Bertrand Russell, A. N. Whitehead and David Hilbert, were pioneering the use of logic and set theory to understand the foundations of mathematics.

 

On December 5, 1947, Einstein and Morgenstern accompanied Gödel to his U.S. citizenship exam, where they acted as witnesses. Gödel had confided in them that he had discovered an inconsistency in the U.S. Constitution, one that would allow the U.S. to become a dictatorship. Einstein and Morgenstern were concerned that their friend’s unpredictable behavior might jeopardize his chances. Fortunately, the judge turned out to be Phillip Forman. Forman knew Einstein and had administered the oath at Einstein’s own citizenship hearing. Everything went smoothly until Forman happened to ask Gödel if he thought a dictatorship like the Nazi regime could happen in the U.S. Gödel then started to explain his discovery to Forman. Forman understood what was going on, cut Gödel off, and moved the hearing on to other questions and a routine conclusion.

Source: Wikipedia

 



The Vice President of the United States shall be President of the Senate, but shall have no Vote, unless they be equally divided.

Source: US Constitution Article 1 Section 3

Early on in the Bush Administration, the Bush Transition Energy Advisory Team was tasked with formulating national energy policy.  Numerous industry executives met with Vice President Dick Cheney.

Cheney, who had been CEO of the energy company Haliburton in the years immediately prior to his run for office, had close ties to industry insiders, representing a possible conflict of interest.  Shortly after the Bush Energy Task Force met, the Enron scandal erupted, calling into question the value of whatever advice the Bush Administration had received from industry executives.

When Cheney was asked for details about his involvement with the Energy Task Force, he refused to disclose any documents, citing executive privilege.

Years later, when Cheney’s office was suspected of disclosing the identity of an undercover CIA agent to retaliate against her husband for criticizing the Administration, Cheney took a different approach.

To avoid disclosing how his office handled classified information, Cheney maintained that his office was not part of the executive branch, since the Vice President is also President of the Senate.

Since nobody has investigated Cheney’s actions in detail, it would seem he gets to have it both ways — and so might any future Vice President.

Written by Indigo Jones

October 12, 2011 at 7:00 pm

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