2020 & Beyond

2020 & Beyond

In an apparent rejection of the basic principles of the U.S. economy, a new poll shows that most young people do not support capitalism.

- Washington Post, Max Ehrenfreund

By J.M. Hamilton (4-28-2016)

Today, let’s kick it off with a quick quiz, and we’ll make it multiple choice.

Question:  Which political party supports: an Ayn Rand style economic policy, which leads to job killing monopolies and cartels; war without end; unlimited money flowing into political campaigns, from SuperPACs and 501(c); an opaque government, where a tremendous amount of information is classified and shielded from the public’s view; free trade agreements that export U.S. jobs offshore, and establish extra-judicial courts, where multinationals can sue sovereign nations for threatening or harming corporate profits; mass incarceration for victimless crimes, like drug possession; Wall Street uber alles; job crushing M&A fueled by hyper-accommodative Federal Reserve policy; the surveillance state and the military industrial complex that consumes more than half of Federal discretionary spending; and Federal Reserve monetary policy driven by the stock market and the financialization of the American economy???

Answers:

a)  The Republican Party;

b)  The Democratic Party;

c)   The Plutocratic Party; or

d)  All the above

If you answered, “d) All the above,” you’d be correct.  The idea that we live in a one party state, owned and operated by the plutocracy, should not be foreign concept to any keen observer of Presidents Clinton, Bush (W), or Obama.  In other words, the more things change, the more they stay the same.  Namely, thanks to neoliberal economic policies, the ends always justify the means when it comes to M&A, concentration, dereg, government and regulatory capture, tax cuts for high net worth individuals and corporations, offshore tax havens, and free money for the connected, courtesy of the Federal Reserve.

The second a politician pushes back on the Business Roundtable, the Chamber of Commerce, and any other trade organization, or lobbyist, out comes the same refrain: any action contrary to Big Biz’ demands will kill jobs, make U.S. companies uncompetitive, harm stockholder value, and/or crush quarterly profits.  And politicians from both political parties – due to the campaign finance system – swallow it and run with it, that is if they want to remain viable for re-election.

Outside of fifty to sixty-year-old social battles over reproductive rights, LGBTQ, and race issues (which the plutocracy continuously stirs up at the local, state and the federal level, via owned politicians), there is little difference between the two political parties when it comes to economic and foreign policy.  To keep the public distracted, and the illusion/pretense of choice between the two political parties  - the corporate run news media keeps the hot button social issue of the day front and center, meanwhile the nation is run by and for the aristocracy.

If you doubt me, examine closely the right-wing Clintons and their policy of triangulation, essentially adopting and co-opting the GOP’s pro- big business push.  Still doubt me, examine the plaudits Madame Hillary Clinton has received from right-wing conservatives and neocons, among them:  Dr. Kissinger, Richard Perle, Rupert Murdoch, Charles Koch, & Lord Vader himself, Dick Cheney.  How bad is it when the elites are abandoning their party, for an, alleged, Democrat?   Pretty bad.   The GOP elite have always used white evangelical protestants, during the election season; and once in power, conveniently abandoned their base, only to stir up both the base and the aforementioned social issues at the next election.  Notice how these social issues never quite get resolved:  race, gender, reproductive issues, gay and civil rights.  That’s by design.  It’s called divide & conquer, or misdirection, and it is a strategy as old as time. 

The reason why these highly worthy social issues are never quite put to bed is they provide a distraction from the true prize:  economic and civil liberties - combined, or what FDR labeled as the four freedoms.

Read my post released prior to the outcome of the 2012 Presidential election, calling the race for Obama – when by all rights he should have lost due to the economy.  In Richard Nixon and the Southern Strategy, JMH correctly noted that the demographic trends in this country would yield Richard Nixon's, and the GOP’s, Southern strategy useless and inoperable in future national elections.   Doubt me still?   Read my post from 2012, titled ESTABLISHMENT, predicting that through maleovent neglect, and evisceration of the middle class, voters would rise up and turn against the economic and political establishment, and seek out outsider candidates.

How did my prediction turn out?  See Messrs. Sanders and Trump.  Witness the rise of fascism in Europe.

Where are we going w/ all this?  The point of today’s piece is, it’s really not too late.   The Plutocracy can save itself from its worst impulses and tendencies, and restore the social contract.   Crony-capitalism and the exploitation of government, by the private sector and the elite, can be reverse engineered for the greater good.  The solution to the neoliberal economy (aka the Ayn Rand economy) is called a mixed economy, the best of both worlds:  real capitalism, w/ competition strictly enforced and monitored by the government (even free market deities, Smith & Hayek, acknowledged the need for government to set capitalism’s rules of the road), and social benefits paid to the people (the 99%), instead of those least in need (the 1%).  As James Carville said, it really is all about the economy.

Other areas in desperate need of attention:  Crony-capitalism, monopolies and cartels can be broken up, which in turn should create more jobs and opportunity (if M&A is largely designed to eliminate expense and labor redundancies, the reverse is also true).  The idea of utilizing financial engineering to buy back stock to boost ROE, and management pay, can be reverse engineered, turned around, and utilized to enhance worker pay and aggregate demand across the economy.  Big Biz can insist upon a tax overhaul, where they pay at a lower published tax rate (instead of no rate), and lift some of the tax burden off the middle and upper middle class.  Free trade agreements could be negotiated, and rewritten, with a bottom-up focus, instead of a top-down approach.  The separation between money and state is key.  As for the massive global (private and public) debt, there’s two choices:  write downs, or negative yields to eliminate the debt service load and principal.  Neither is appealing, but the alternatives are continued stagnation, subpar economic growth, or worse, default.  And finally, government privatization, and our global wars, and our drug war, must all come to end.... they are a huge drain upon the nation's resources.

Why would the wealthy do all this?  It’s called self-preservation.

Millennials aren’t afraid of socialism and seeing as how the elite pig-out at the government trough, daily…. Well, socialism seems to work pretty damn well for the 1%.  Millennials aren’t afraid of Big Government or government programs.  Again, the youth are only following the legacy of Wall Street bank bailouts, and multinational handouts courtesy of free trade agreements.  Bank CEOs strutted around like the world owed them something, or were they merely doing the Goddess’ work(?), while their Great Recession destroyed the global economy.  The public saw all this but the millennials paid a disproportionate price.

If we continue on our present course, if the neoliberal/laissez faire economy fails to produce jobs and opportunities (which it will), the latest generations will insist that a living wage be paid to all citizens – by the government, whether they are employed or not.  After all, how long will millennials tolerate unconscionable & usurious college debt, non-living wages, and cohabitating w/ their parents?  (Maybe it's destiny: Even with real capitalism – with real competition enforced by the government – increasingly relying upon robotics, automation, globalization, and A.I., perhaps it's only a matter of time before we are all unemployed?)

Think Messrs. Sanders and Trump are novel, and outside the political norm?  If the establishment blows this election off as an anomaly, and continues on its present course, the political extremes will, more than likely, only amplify and magnify, in 2020 and beyond.  

Copyright JM Hamilton Publishing 2016


Correction: Richard Nixon and the Southern Strategy was released on election day, not on election eve, as previously described.