Posts Tagged ‘Corporatism’
As it stands, Rogers explained, we’re losing somewhere between $100 billion and $400 billion worth of intellectual property to theft each year. This, he said, is of particular concern to the Department of Defense, which watches as its contractors networks are regularly compromised by adversaries.
To the extent that his statement reflects how US tax dollars are spent, the situation is to a considerable extent the result of military downsizing under President Clinton, which wasn’t really downsizing, but outsourcing. Issued on May 21, 1996, Executive Order 13005 – Empowerment Contracting states its objectives as follows:
In order to promote economy and efficiency in Federal procurement, it is necessary to secure broad-based competition for Federal contracts. This broad competition is best achieved where there is an expansive pool of potential contractors capable of producing quality goods and services at competitive prices. A great and largely untapped opportunity for expanding the pool of such contractors can be found in this Nation’s economically distressed communities.
The problem is, this way of approaching “efficiency” leads directly to reduced accountability. Those who rail against government inefficiency don’t understand that accountability is not efficient: it is not efficient to justify your actions at every step. So the push to make government more lean and “efficient” by outsourcing government functions to the private sector leads directly to an erosion of accountability. You can’t have both accountability and efficiency as policy goals.
Pulitzer prize winning historian Gary Wills suggested that, for example, part of why the Manhattan Project was conducted with such extraordinary secrecy was specifically to evade accountability. The Russians knew what we were up to, the Germans probably knew too, it was the American people kept in the dark. Wills argues this was probably to avoid potential opposition to the development of nuclear weapons in light of the 1925 Geneva Protocols against chemical and biological weapons. Around the globe, people were shocked by the destructiveness of mechanized warfare during World War I and by the use of chemical weapons. The First World War and the technological horrors is brought were still very much in public memory by the time World War II came around.
Wills also points out that this use of secrecy to evade accountability was no isolated instance. When the US bombed Cambodia, the Cambodians knew it, it was US citizens kept in the dark. When the US invaded Cuba, the Cubans knew what was happening and the Soviets knew, it was US citizens kept in the dark.
Today we have active drone campaigns in at least eight foreign countries responsible for the deaths of thousands in what is essentially an undeclared global war. Insofar as the targets are terrorists, the terrorists know they’re being targeted. Again, it’s US citizens kept in the dark.
The origin of the “state secrets” doctrine derives not from any law that Congress passed, but from efforts by the US military to evade accountability over flaws in the engine design of a new aircraft, which led to the deaths of several citizens.
Accountability is not efficient. To increase accountability with surveillance matters, there needs to be a reduction in contracting, which means, the government needs to get bigger. Edward Snowden — a contractor himself — would seem to be a clear cut example in support of this view.
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.
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.”