Centrifugal Forces

Centrifugal Forces

In a report issued Wednesday, the (IMF) emphasized that flatter tax rates across income scales and lower rates for the highest earners could exacerbate a troubling trend toward growing inequality in the United States and around the world.

-       I.M.F. Cautions Against Tax Cuts for Wealthy… NY Times

During the campaign, Trump said that Republican rivals who attended secretive donor summits sponsored by the Kochs were “puppets.”

-       The Danger of President Pence… The New Yorker

By J.M. Hamilton (10-15-2017)

What do the following countries - or regions or states w/in states - have in common: The U.K., Scotland, Basque Country, Catalonia, Spain, Brazil, Canada, Quebec, Italy, Venice, Wallonia, Belgium, Kurdistan, and Iraq?

Answer:  These are just some of the countries - or regions/states within states - either facing breakaway movements or seeking to secede from their existing governmental arrangement.  

Not only are countries, states, or regions around the globe seeking to secede from their existing political arrangement, and establish their own governments, but there also has been a noticeable rejection of establishment (center right and left) political parties in many additional countries:  Austria, the Czech Republic, France, Germany, Poland, and the United States, just to name several.  More frightening still, parts of Europe - and even in the U.S. - have seen fascist/nationalist movements on the rise.

What is driving this political upheaval or centrifugal force away from the center?  The answer is both economic - as in globalization - and governmental.

Let's start with economics or globalization first.  Globalization or free trade was sold to many citizens throughout the West as an economic panacea.  Globalization - by allowing each country to specialize in the products & services it produced best - was supposed to bring political stability, a rising global middle class, and inexpensively produced goods and services.  Unfortunately, but for inexpensive goods & services, very little of globalizations promises have come to pass.

As for political stability, globalization has created political instability, see the aforementioned countries facing political revolt and secessionist movements.

As for a rising middle class, the middle class has nearly been obliterated in the West, and ask any day laborer in China, Mexico, or Indochina if they feel that they have achieved middle class success?  I can assure my readers many have not achieved middle class success, by any standard we would recognize w/in the West.  Instead globalization has created a global billionaire class that have exploited free trade agreements for their own ends. Namely, the billionaire class engages in currency, labor, regulatory, and tax arbitrage... which contributes greatly to ever growing wage & wealth inequality and wage stagnation for the 99%.  

This, in turn, has created a global race to the bottom among nation states, a reduction in tax revenue from corporations & multinationals in many countries, countries deeply mired in debt…  followed by austerity and a growing reduction in governmental services for the 99%.

Yes, “free trade” products & services are often cheaper, fueled by globalization, AI, automation, and slave labor from EM (such as Asia, India, and Mexico).  But for a dying middle class w/in the West, inexpensive goods and services are of no value, if the price paid is lost jobs and wages.

Catalan independence referendum  --- CreditEmilio Morenatti/Associated Press

Which brings us to Western governments and democracy, and its role in the rebellion and secessionist aims around the globe.  Many so-called democracies are democracies in name only.  The billionaire class - thanks to the outsized role money plays in the political process - confirms, nominates, pays for, and provides the talking points for many establishment politicians.  So that on matters concerning business interests, there is often very limited difference between center right and center left political parties. These elites have failed the middle class and the poor, and operate government almost exclusively for the oligarchy. 

That is to say, power corrupts and absolute power corrupts absolutely.  The secessionists clearly want their government local and accountable.

Hence, a powder keg of rebellion around the world. There is little doubt culture and race - at times - plays a role in some nationalist movements.  But ask yourself, if there was truly a thriving middle class around the globe would "democratic government," globalization, and neoliberalism be faced with the current threat list?  Ask yourself again, would fascist and nationalist movements rise, if the U.S. policy of endless war in the Middle East (and the West's policies that support climate change & fossil fuels) didn't send millions of refugees and migrants into Europe?

The elite and the oligarchy’s immediate reaction to the growing rebellion is to lash out, insist their ways are best, and use police state tactics to control and contain the rebellion.  

But these strong-arm tactics are bound to fail.  Police state tactics didn’t stop the former Soviet Union, and its satellites, from failing and surrendering to centrifugal forces, and they certainly won’t contain a growing number of independence movements.

Only real reforms will turn these centrifugal – economic & political - forces around.  Reforms that recognize both the economy and government must work for all, not just an elite cadre of insiders, are clearly needed.

Copyright JM Hamilton Publishing 2017