2013: Number One
A few years ago Pluto Press published my book Inequality. /1/
Its intent was to assist and increase political efforts to reverse the worsening depth and spread of inequalities in the USA. Such efforts had been made with some success after World War II in the USA, Western Europe, and the UK; but only for a while. Since the 1970s inequalities have returned, are deeper and harsher; most drastically, but not only in the USA.
Inequality has been the norm from humanity’s birth, but with capitalism’s ends and means it has spread increasingly, worsened and, although intrinsically plutocratic it has effectively disguised itself as democratic. The great dangers of disguised inequality were made obvious when after World War I all but two of the six main capitalist nations – the UK and USA – swiftly became fascist. Its horrors and associated wars were sufficient to bring about substantial popular moves – for a while -- toward genuine democracies in the main capitalist nations after the war.
Thus, since the 1970s capitalism has marched steadily back toward its normal ways and means of labor exploitation, imperialism, militarism, and the destruction of nature. Allowed to continue along that path, today’s capitalism will further reduce our already scanty democracy. In doing so, they will be taking us toward the ways and means of fascism, and with a different name, militarism will continue, deepen, and spread, and we will be headed to the end of life on the planet.
Those now in power must be fought and replaced by a true democracy, one ruled by the people as a whole. That can be achieved only if we create an always spreading and deepening popular movement determined to become and remain politically involved: at last. The creation of such a political movement in our time could understandably be seen as impossible, but our 1960s history shows that it is not: In those years, as the Vietnam War of the USA continually expanded it might well have been seen as impossible to create an antiwar movement. However, a small group of us of mixed colors, religions, and politics got together and soon created what became a substantial antiwar movement. We soon gained the support of millions of people from dozens of different political groups. It is relevant to note that those groups also gained strength for themselves in doing so.
That movement’s always rising strength prevented the USA from using atomic weapons, which also meant it could not win the war. With variations, much the same may be expected from a movement against inequality and its related social crimes. In our time we must do our best to bring the decency of our people back to life; awaken them to realize that if and only if we work together politically we can never have a safe and sane society. And it is worth repeating that as with the antiwar movement, in our working against inequality we will also be strengthening participation in and for all political realms. The need is critical, and time is running out.
Now I turn to some of our ugly realities. The USA and much of the rest of the world had entered into a socio-economic crisis as this century began. Its basis was deepened and widened from the 1970s on, as high finance and globalization’s money and propaganda gained them always stronger political control. In what follows the many dimensions and consequences of inequality – political, military, and environmental -- will be examined, along with their diverse social consequences. The focus will be mostly upon the USA, with relevant comments upon other nations.
As was noted above, during and after World War II democratizing political movements were taking hold in the USA and elsewhere. However, except for only a few nations (e.g., Sweden and Finland) the movements faded, and the rise toward a genuine democracy was short lived. As the 1970s took hold, the good sense and political efforts of all too many of us were overcome by hyped-up consumerism and smothered by senseless borrowing. In the same years, substantial U.S. imports from Europe, China and Japan were made feasible by the nation’s wild foreign indebtedness.
The dangers of that wildness were increased as Wall Street pushed us to the cliff’s edge with ever wilder speculative ends and means, and a bought and paid for Congress eased the way. Such madness was facilitated by the overturning of the financial regulations which the Crash of the 1920s-30s had prompted. It is important to add that although the “overturning” was begun by the Republicans under Reagan, it was continued and even worsened by the Democrats under Clinton, and been left untouched by our corrupted government. Such political and economic behavior is shocking, but is not surprising. Indeed, it was foreseen and understood by Tawney already in 1931:
The equality of civil and political rights is of the essence of democracy; the inequality of economic and social opportunities is of the essence of capitalism. Democracy is unstable as a political system as long as it remains a political system and nothing more; instead, democracy should be not only a form of government but a type of society and a manner of life which is in harmony with that type. /2/
Except for a handful of the small democratic nations of northeastern Europe, that “harmony” has not existed in the world’s capitalist nations, except to deceive. Indeed, its power-drunk beneficiaries have worked hard to keep it that way, going so far as to allow the wiping out of democracy with fascism when their ruthless capitalism is threatened. The dangers of that socio-economy were understood by Yates already a quarter of century ago:
Unlike other modes of production, such as slavery or feudalism, capitalist exploitation is hidden by the market; it takes place behind the workers’ backs, so to speak. They sell their ability to work in the impersonal market, and it appears that the market dictates their pay, but once they sell their labor power to the employer it belongs to the boss just as surely as does the machinery. /3/
That such is so disgraceful and harmful was more recently noted 2006 by U.S: Senator Jim Webb:
The most important – and unfortunately the least debated issue – in politics today is our society’s steady drift toward a class-based system, the likes of which we haven’t seen since the 19th century…. In the past 25 years America’s top tier has gown infinitely richer, own most of our stocks, and the top 1% takes in an astounding 16% of national income, up from 8% in 1980,,, When I graduated in the 1960s the average CEO made 20 times the average worker. Today, the CEO makes 400 times as much. /4/
Even more alarming is the economic similarity between the scandalous 1920s and what began to emerge in the 1970s. It sped up as the 20th century ended, and is now “maturing” in thee ways noted by Phillips listed below. As you ponder the ugly similarities between that past and our present; recall what followed the “Twenties”; and tremble:
1. The outgoing control over the economy by an always smaller and hungrier bunch of CEOs and financiers.
2. The swooning cooperation of governments at all levels.
3. The fragility of the US and the global economies, due to recent and ongoing madness, much worse than in thee 1920s.
4. The evolving weakness of a good majority of the rest of the economy, both at home and abroad.
5. Troubles in the agricultural sector, in much of industry and construction.
6. Spreading and deepening poverty.
The foregoing critiques are only an introduction. A substantial and frightening analysis of the “youth” of our era may be found in the book of Baran and Sweezy: Monopoly Capital: An Essay on the American Economic and Social Order (1966) Although written more than half a century ago, it is not necessary to add much more today. A mere handful of giant corporations has taken over the powers of the several hundreds Baran and Sweezy condemned. Socio-economic concentration was already too dangerous in that time: that is, domination by only a few hundreds of large corporations. Now only a few dozen super-giants control a very much larger economy at home and overseas. By the 1970s we were well on our way toward disaster; now the business giants have put us on its edge.
“We the People” must begin now to work hard politically for a society
run by a government which provides well being for all at home and peace abroad. If and when achieved, our society would differ from now in all realms: political, economic, and social, and would assure dignity, self respect, and morale for all. We cannot get there without a strong political movement of the people. We must immediately take the essential political steps in that direction; that is, the creation of a political movement of and for the people. Such a movement can be successful if and only if it becomes and be seen as a continuing element of our lives. What follows now are what may be seen as desirable aims, ways, and means for that achievement, beginning with 1) politics, 2) the economy, and 3) social needs -- e.g. health care -- with the understanding that they are interdependent. If our needs for a safe and sane society are to be achieved we must get together and stay together politically with never ending political efforts. To which I now turn.
Politics. The guiding principle must be a genuine democracy, where needs and rights and political representation are for all, no matter the age, income, sex, color, region, or religion. Elections and political parties must have equal access for all; congressional representation should be determined by political strength and voting made accessible to all. The Supreme Court’s selection and tenure should be reconsidered as might be that of the Senate. Also, the ways of functioning of elections of cities and states must be reconsidered, given that so many of them drown in corruption.
A good place to think through the foregoing is the recent book of Richard Wolff: Democracy at Work: A Cure for Capitalism. After a discussion of the different kinds of capitalism (and seeing fascism as “a close partner of capitalism” when needed) his critique of today’s social power takes hold:
What remains the same for all of its forms is the exclusion of the mass of workers that produces the output and generates the profits from receiving and distributing that profit and from participating democratically in enterprise decisions…; excludes the workers from deciding what is produced, how it is produced, where it is produced, and how profits are to be used and distributed.
Wolff proposes a new popular movement as an alternative to capitalism: “WSDE”: “Workers’ Self-Directed Enterprises.” He defines “WSDE” as an organization “which entails the workers who make whatever a corporation sells also functioning collectively and democratically as their own board of directors…. The workers themselves cooperatively run their own enterprise, thereby bringing democracy inside the enterprise where capitalism had long excluded it.”
Such a “movement” has to be national in function, must have means of communication and, among other needs, come forth with a clear set of “whys and hows”: a steep mountain to climb, but well worth doing; not least because the ongoing political situation is not only disgraceful and harmful, but is taking us toward total disaster.
Clearly, the foregoing “political” discussion overlaps with the economic discussion that follows, as both do with what will be taken up under social needs: as, of course, all three do in the real world, for better and for worse: mostly for worse, unless and until we get together and work politically to make their interactions positive rather than ugly.
The Economy. Until late in the 19th century only a tiny minority anywhere in the world could live comfortably, and they – in their kingdoms and the like -- lived luxuriously. However, as that century was coming to an end and, even more when the 20th century was on its way, modern technology was well on its way for everything: agriculture, communication, construction, mining, production, transportation; you name it.
Even before the end of the 19th century it had become obvious to those who worked for wages ( in mines, factories, buildings, or farms) that as production was becoming gigantic, their lives, their housing, their food, their pleasures should also shift up to a safer and more comfortable level: so they organized. For which they were fired, and or beaten up, murdered, and/or imprisoned. Not until well into the 20th century could organized labor function politically without being persecuted by bought and paid for and business-controlled governments; not until after World War II would capitalist nations be faced with substantial political strength from “the people.”
However, as the 1960s ended the use of that strength had slowed down and, especially in the USA, disappeared. In the same years business politics was becoming consciously stronger and smarter. When Obama was first elected it seemed as though we were making a turn for the best. We were not; indeed then and now dangers were and are increasing.
In an important recent article Joseph Stiglitz concentrated upon the dangers in the many realms of inequality. Here a very long quotation, which deserves to be read and acted upon:
With inequality at its highest level since before the Depression, a robust recovery will be difficult in the short term, and the American dream -- good life in exchange for hard work – is slowly dying…. The magnitude and nature of the country’s inequality represent a serious threat to America, we should know that something has gone terribly wrong. And yet, after four decades of widening inequality and the greatest economic downturn since the Depression, we haven’t done anything bout it. There are four major reasons inequality is squelching out recovery:
1) Our middle class is too weak to support the consumer spending that has historically driven our economic growth. While the top 1 percent of income earners took home 93% of the growth in incomes in 2010, the households in the middle – who are most likely to spend their incomes rather than save them and who are, in a sense, the true job creators – have lower household incomes, adjusted for inflation, than in 1996..
2) The hollowing out of the middle class since the 1970s means that they are unable to invest in their future, by educating themselves and their children and by starting or improving businesses.
3. The weakness of the middle class is holding back tax receipts, especially because those at the top are so adroit in avoiding taxes and in getting Washington to give them tax breaks. Returns from Wall St. speculation are taxed at a far lower rate than other forms of income. Low tax receipts mean
the government cannot make the vital investments in infra-structure, education, research and health that are vital for restoring long-term economic strength.
4. Inequality is associated with more frequent and more severe boom-and-bust cycles that make our economy more volatile and vulnerable. It is no coincidence that the 1920s -- the last time that inequality of income and wealth in the United States was so high – ended with the Great Crash and the Depression.
Our skyrocketing inequality – so contrary to our meritocratic ideal of America as a place where anyone with hard work and talent can “make it – means that those who are born to parents of limited means are likely never to live up to their potential…. More than a fifth of our children live in poverty – the second worst of all the advanced economies, putting us behind countries like Bulgaria, Latvia and Greece…….. Despite Mr. Obama’s stated commitment to helping all Americans, the recession and the lingering effects of the way it was handled have made matters much, much worse. While bailout money poured into the banks in 2009, unemployment soared to 10 percent that October. The rate today (7.8%) appears better partly because so many people have dropped out of the labor force or never entered it, or accepted part-time jobs because there was no full-time job for them…. High unemployment, of course, depresses wages…. Lower tax receipts, in turn, have forced state and local cutbacks in services to those at the bottom and middle. Most Americans’ most important asset is their home, and as home prices have plummeted so has household wealth – especially since so many had borrowed so much on their homes…..Meanwhile, as incomes have stagnated, tuition has soared…. The only sure way to move up is to borrow. In 2010, student debt, now $1 trillion, exceeded credit-card debt for the first time. Instead of pouring money into the banks, we could have tried rebuilding the economy from the bottom up…..; could have enabled home owners…who own more money than their homes are worth to get a fresh start by writing down principal in exchange for giving banks a share of the gain if and when home prices are recovered….
We could have recognized that when young people are jobless their skills atrophy. We could have made sure that every young person was either in school, in a training program, or on a job. Instead we have let youth unemployment rise to twice the national average…..
We are sowing the seeds of ever more inequality in coming years…
The Obama administration does not, of course, bear the sole blame....
/He goes on to show what Obama inherited from the two Bushes and the negative impacts upon our labor majority in consequence of our always increasing globalization. Then this conclusion:/
As Mr. Obama’s second term begins, we must all face the fact that our country cannot quickly, meaningfully recover without policies that directly address inequality. What’s needed is a comprehensive response that should include, at least, significant investments in education, a more progressive tax system and a tax on financial speculation.
In the early part of this work I noted the rise of fascism in four of the leading capitalist nations in the interwar years, noting that it arose after World War I, when economic crises threatened the maintenance of capitalism. This article has focused upon the increasing harshness of economic life for the majority in a society which could -- if truly democratic, rather than in name only – provide safe and comfortable living for all; a worrisome repeat of the period which produced fascism: with scary differences.
That the interwar disaster could recur in our time -- even more disastrously – was warned by Bertram Gross already in 1980, in his aptly entitled book Friendly Fascism. (9) It is worth paying close attention to on our time. Here an introduction of his book from my Inequality: “The major theme of his the Gross book is that massive brutality is unlikely in the future if a threatened capitalism is to maintain its social control; that the costs will be borne by an increasingly hypnotized and/or terrified public, made passive and vulnerable by consumerism and a cooperative media; that populations can and will be exploited, economically, militarily, and, politically: all of that because of the because of the absence of a popular counter-movement seeking a better life in a decent society.” Now to the Gross book itself:
A “friendly fascist” society is one without the need for a charismatic
dictator, one-party rule, glorification of the state, dissolution of legislatures, termination of multi-party elections, ultra-nationalism, or attacks on rationality. Rather if and when neo-fascism emerges it may be associated with a relaxation of crude terror and the maturation of more sophisticated, effective, and ruthless controls. In my judgment, one of the greatest dangers is the slow process through which friendly fascism could come into being. For a large part of the population the changes would be unnoticed. Even those most alive to the danger may see only part of the picture – until it is too late.
That was how Gross ended his book. This is how I ended my 2007 book Inequality, and, now end this article:
All of that hell has been on its way for many decades, and much of it has arrived. No matter what we do that hell will continue to harm all corners of our lives; bit by bit. All too likely is a gush of depression and/or war, and/or environmental disaster. It may be both thought and hoped that the numbers of people in the USA and elsewhere who yearn for social decency and peace outnumber those who do not. But those in power have habit as well as money on their side; we have only our principles and our numbers. They must be translated into energy and political participation. It is quite possible that no matter what we do we cannot win; it is certain that if we continue to do too little that not only are we leaving open the door to “friendly fascism,” but that we will have lost our humanity in “looking the other way” as that set of atrocities evolves. /To which I add/: It’s us or them; now or never. See you soon?
1. The book was Inequality and the Global Economic Crisis (Pluto Press, 2009). In this article I will follow the structure and analysis of the book, much reduced and brought up to date.
2. R. Tawney, Equality (1931)
3. M. Yates, Longer Hours, Fewer Jobs; Employment and Unemployment in the United States (1994)
4. Quoted in Wall Street Journal (Nov. 15, 2006)
5. P. Baran, The Political Economy of Growth (1957)
6. K. Phillips, Wealth and Democracy: A Political History of the American Rich.
7. R.Wolff. Democracy At Work; A Cure for Capitalism (2012) An excellent discussion of the book was provided by Mark Karlin in Truthout on January 8, 2013. Truthout states it will provide a free copy of that book “with a minimum contribution to itself: “just click here.”
8. His long article -- “Inequality is Holding Back the Recovery” -- was published January 19, 2013, in The New York Times.
9. B. Gross, Friendly Fascism: The New Face of Power in America (1980)