Posts by KofasJon:

Part 2: 21st century challenges to American democracy

May 1st, 2015

 

 

 

By Jon Kofas.

 



 

Rising Public Debt, Dwindling Democracy.

Conservatives attribute the rising public debt to government spending on costly entitlement and social programs. They conclude that deficit financing for entitlement and social programs poses a threat to the free market which they equate with democracy. Liberals argue that the fiscal system favors the top income groups and such capital concentration poses a threat to a pluralistic society and the market itself. The public debt is indeed massive by historical standards for a peacetime economy. However, the US still has the advantage of using the dollar as a reserve currency that is more universally used for trade and transactions than any other, thus keeping interest rates low and funding “vertical economic growth” focused on capital goods and luxuries, as opposed to horizontal growth focused on labor intensive projects for the benefit of the mass consumer. (Romina Boccia, “How the United States’ High Debt Will Weaken the Economy and Hurt Americans. The Heritage Foundation”, 12 February 2013)

With rising GDP-to-debt ratio rates and with other reserve currencies on the horizon, the US does not have the luxury it has enjoyed since Bretton Woods in 1945 with regard to the dollar as the premier world currency. If the public debt is not contained by slashing the corporate welfare programs through subsidies and fiscal system as well as trimming defense that remains the largest in the world, then US debt-to-GDP ratio will double by the middle of the century. This will mean a weaker dollar and a weaker and smaller middle class that historically has been the backbone of American democracy. While the public debt by itself does not constitute a threat to American democracy, combined with other egregious policies it is a challenge because it is not creating wealth and raising productivity for the benefit of all, but concentrating wealth for the top one percent of the richest Americans.

Because there are foreign buyers of US treasuries and largely because China needs the US as a market as much as the US needs China to buy bonds, the dollar remains stable for now despite a debt-to-GDP ratio that could reach 190% by the early 2030s, according to the Congressional Budget Office. In 2008 when the global financial crisis started as a result of the subprime lending among other bank and insurance company scandals for which the US taxpayers had to pay bailout funds, US debt-to-GDP ratio was just 64%. In 2014 the ratio stands at 102%, costing taxpayers $223 billion. Servicing the debt amounts to 6.5% of the budget, which is still less than half of what it costs Japan to service its debt. The public debt per se is not the issue assuming that funding is used to finance future growth and development.

If there is continued borrowing to finance the military industrial complex and to continue the corporate subsidies, instead of financing labor-intensive economic growth, then the debt cycle will continue growing and falling more heavily on workers and middle class whose living standards will suffer more losses. While the US was a net debtor nation from its independence until the outbreak of WWI, the debt in the 19th century was invested in the civilian sector resulting in rapid modernization of the agrarian and mining sectors as well as manufacturing. It was not until the late 1880s-early 1890s that funds were expended to build a major defense sector. The result was upward socioeconomic mobility. After 1980, debt at unsustainable levels has been crippling, especially when it was not directed toward productive enterprises that create more wealth for the broader middle class. As the popular base of American democracy weakens partly because of the rising debt, this will have an impact on democracy no differently than in other debtor countries under austerity.

Finally, the debt burden falls inordinately on the middle class and workers, undermining not just social programs that would otherwise benefit society, but the fabric of a democratic society with a modicum of social justice as its base. One could argue that this would all be well worth it if it resulted in “horizontal economic growth” in which the broader middle class and workers benefited. However, debt crises only result in massive capital concentration and austerity politics results in authoritarianism. Debt becomes a creditor’s tool of influencing if not determining policies that the debtor must follow, thus losing national sovereignty. (Michael Moran, The Reckoning: Debt, Democracy, and the Future of American Power; Samuel Rines, “How Debt Destroys Democracy” The National Interest, October 2013; Andrew Ross, Democracy and Debt. http://what-democracy-looks-like.com/democracy-and-debt/)

Systemic Inequality, Corporate Power, and Parasitic Economics.

When the American Republic was founded, there was an institution of slavery, native Americans were marginalized with their condition becoming much worse a century later, women had no political rights, and social inequality was very much alive and deemed “normal”. Despite progress toward democratization of society in the past 200 years, the republic remains an unequal society in the early 21st century characterized class, racial, ethnic, and gender inequality. If we assume that industrial, technological and scientific progress necessarily yielded overall progress for society, including a course greater not less democracy, it would not be a wrong assumption. However, it would be wrong to assume that the Industrial and Scientific revolutions in 19th and 20th century America necessarily represent a parallel course toward democratization. The reason for this is that as much in the 19th century as in our own times, affluence simply buys influence. (Martin Gilens, Affluence and Influence: Economic Inequality and Political Power in America)

Hardly any political observer of American politics is unaware of how money buys favors that includes everything from subsidies to corporations to export their products, to tax breaks and tax loopholes for the very rich. Just one look at the occupancy rates of lobbyist office space in Washington D.C., northern Virginia and southern Maryland, and immediately there is a realization that entrenched corporate interests have a keen interest in determining policy. In some cases, the lobbyists actually draft the bills that go before Congress, in others, lobbyists have the last word and only conflicts among the disparate capitalist interests within the same sector or in different sectors are resolved through political compromise. (Ailsa Chang, “When Lobbyists Literally Write the Bill”, 11 November 2013, WWW.NPR.ORG; Jeffery Birnbaum, The Lobbyists: How Influence Peddlers Work Their Way in Washington)

If lobbyists determine policy on behalf of business, and if politicians do not take into account the general welfare of the broader population, is it any wonder that for the last four decades the US has been experiencing a downward social mobility and decline in democracy? One of the characteristics of American society in the early 21st century is inherited socioeconomic immobility. Unlike the children of the working class in the post-WWI decade, the children born in this new century to workers are unlikely to move into the middle class. There are very few mainstream media outlets that even cover this issue and those that do insist that inequality is not a threat to American democracy.

It is no secret that the US has one of the worst records among the G-20 in income distribution, any more than it is a secret that the US has one of the world’s highest wealth concentration, thus inequality, and a rapid downward socioeconomic mobility. Such polarization in the economic domain leads to political polarization, or at the very least alienation and this is a contributing threat to democracy. Advocates of neoliberal policies insists that the problem is not lack of fair income distribution, but government legislating minimum wage, safety, health and environmental standards, and layers of bureaucratic costs that make it difficult for companies to reinvest. (Richard Fry and Rakesh Kochhar, America’s wealth gap between middle-income and upper-income families is widest on record. Pew Research Center, 17 December 2014)

Many conservatives insist on slashing entitlements and revamping the entire social welfare system as we have known it, and just let the market fix everything the way it did in the Gilded Age! If government simply offered the private sector “opportunities” through contracts for all services performed by public employees, then all would be grand with society. As long as government outsources all services from cleaning services to complex engineering projects to the private sector, and as long as government keep paying those subsidies to corporations, bails out banks and insurance companies during recessions, and makes certain they paid the lowest possible taxes, there would be no problem whatsoever with society.

Therefore, democracy equals a neoliberal approach to public policy and opportunities for businesses carrying out government contracts. Where would this leave the middle class and workers is up to them individually based on what they have to offer the marketplace. Where would this neoliberal model leave citizens demanding accountability for all public services? Even today we can see the striking difference in everything from street maintenance to the condition of parks between an urban slum and a wealthy neighborhood. This reflects the very real class divide and reveals the fundamental inequality in services, no matter what politicians claim about government serving all people equally.

The real prospect that inequality will become worse and a permanent feature of American society poses a huge threat to democracy. Apologists of the political economy insist economic inequality is not a challenge for American democracy because inequality is simply a “natural” condition reflective of individual effort and ambition. Even those acknowledging there is a systemic problem propose that it can be solved only by raising productivity, not redistributing income. US productivity rates averaged about 3% from 1995 until 2005, outpacing the rest of G-7. Despite such impressive productivity rates surpassed only by China and the BRIC group, the middle class and workers continued to experience downward trend of incomes. Therefore, the productivity argument, which has been used since Adam Smith in the late 18th century, is hardly pertinent. Meanwhile, massive wealth concentration is a major problem for both the economy and democracy. The media and most in society applaud the news that Amazon CEO Jeff Bezos made close to $5 billion in profit in a single day on 24 April 2015, while a few may ask how can one individual make more money the combined annual GDP of eight sub-Sahara countries? According to the Wall Street Journal, America’s richest 3% experienced a 30.5% of income rise, in 2013, while the bottom 90% of income earners continue to lose income. According to various studies, the inequality gap is very real and becoming worse. In fact, US inequality is worse now than it was on the eve of the Great Depression, signaling a crisis in the economy and society. (Emma Bell, Soft Power and Freedom under the Coalition: State-Corporate Power and the Threat to Democracy)

Besides the grossly uneven income distribution impacting democracy, there is also the issue of the parasitic nature of the economy. There are many studies on banks and financial firms as parasites, just as there are studies about consulting firms and defense contractors as parasites, especially since they overcharge and their services are of dubious quality. One could argue as neoliberals do that dishing out contracts, even to parasitic entities, is one way to keep the private sector strong, even if it offers nothing back to society. Clearly, the narrow definition of a parasite to an economy is one that only takes and adds nothing to growth, productivity or value to the economy in the present or future, thus weakening it for the majority so the minority benefits. There are many examples from which we can illustrate this point, but let us take one that the New York Times exposed regarding the role of Goldman Sachs in the last ten years, although the same strategy has been carried out by J. P. Morgan among other major firms.

When Goldman purchased Metro International aluminum warehousing company, it slowed shipping to such a degree that Goldman realized $165 million per year in rents for the stored aluminum, not counting the sharp rise in profits resulting from higher metal price because of the artificial shortages. This is the same Goldman firm that was helping Greece and other governments during the 1990s and early 2000s to convert debt into assets on paper only, of course in order to deceive creditors and regulators. This illegal enterprise realized millions in hefty fees for Goldman and fooled the EU regulators, at least until the EU demanded an end to this practice. Ironically, at the time of these illegal activities, European Central Bank chief Mario Draghi was the head of Goldman’s international division!

Most large US and EU banks have been involved in scandals amounting to hundreds of billions in illegal activities resulting in the collapse of the financial system from 2008 until 2013. The bailout for the private banking system came from public money.

US and European banking scandals in the last two decades are salient factors in the massive transfer of capital from society into the hands of very few people. This as government repeatedly intervenes to save banks using taxpayer money and lowering living standards for the middle class and workers in the process, but justifying it on the basis of a) too big to fail, and b) jobs would be lost.

All along, the media has been singing the praises of the “heroic capitalist” while vilifying the state as the culprit in these scandals, as though the state has been acting on behalf of the general public instead of finance capital. Banks demanded deregulation so they can engage in high risk practices with funds of depositors that they gambled, and for which they had to pay billions in punitive fines both in the US and European governments. Yet, according to the media the fault rests with government for failing to do its job right. (Steve Schifferes and Robert Manning, eds., The Media and Financial Crises: Comparative and Historical Perspectives)

Beyond the systemic problem of legal and illegal parasitic capitalism that is global and not the domain of a single country, there is the direct correlation between healthy economic development and a thriving democracy. Healthy economic development where the benefits are fairly distributed among workers and the middle class that produce wealth and democratization of society cannot possibly take place when a tiny percentage of the population owns the vast wealth and keeps recycling it without investing for the broader good of all people. The higher the level of parasitic economic activity in a society, the lower the level of democracy, a phenomenon invariably associated with underdeveloped nations but actually plagues the US and the EU. (Tatu Vanhanen, Democratization: A Comparative Analysis of 170 Countries; Nicholas Ryder, Financial Crime in the 21st century: Law and Policy; Ismael Hosein-zedeh, Beyond Mainstream Explanations of the Financial Crisis: Parasitic Finance Capital).

According to a Rolling Stone article, the London-based firm ICAP which is the world’s largest broker of interest-rate-swaps, has been involved in a massive banking scandal. The interest-rate-swap market is worthy $379 trillion, which means that ICAP in essence has the immense power of manipulating massive amounts of capital by fixing rates and manipulate the market on behalf of its clients that include the largest US and EU banks. The shocking thing here is that the US government draws some of its top people to run various departments, including Treasury from financial institutions that the Justice Department has repeatedly fined for all sorts of violations. How can democracy possibly function in practice as it is conceived in theory when the same people who manipulate markets to the benefit of the very few insider investors that government entrusts the mechanisms of running a democracy? http://www.rollingstone.com/politics/news/everything-is-rigged-the-biggest-financial-scandal-yet-20130425#ixzz3Y4HyHpDJ

 

The Supreme Court and the new Gilded Age

Is the Supreme Court out of touch with the American people and has the nation’s highest court reverted to the Gilded Age of the late 19th century during the era of robber barons? The role of the Supreme Court has always been very important in interpreting Constitutional law and its rulings are significant in either strengthening democracy for all citizens, or weakening it so that the privileged few may prevail. In September 2014, senators Tom Udall and Bernie Sanders wrote that a century of hard won battles to create a more democratic society have been obviated by recent developments. For example, American democracy has become less inclusive because the Supreme Court has 1) struck down important elements of the Voting Rights Act and 2) diluted campaign finance laws, permitting even greater influence by the very rich in the political arena.

As campaigns become increasingly more expensive, a few hundred people directly and through various entities, including super-PACs, exert dominant influence in politics. It is for these people that policy is formulated to the detriment of the rest of society because they have paid to elect politicians at every level of government. The Supreme Court justified buying political influence with the First Amendment that constitutionally protects free speech. Senators Sanders and Udall argued that: “Americans’ right to free speech should not be proportionate to their bank accounts.”

When the Supreme Court becomes an impediment to democracy and fails to protect all citizens so that it can serve the politically entrenched elites, then the democratic regime itself has suffered a damaging blow. The republic survived the Gild Age when the Supreme Court was serving the narrow interests of the very rich, and it will survive the criticism today that it has reverted to 19th century undemocratic thinking. However, no matter how much the Supreme Court tries to legitimize social injustice people know the difference between what is just for a society and what is unjust. This is something that Justice Louis Brandeis grasped more than any other Supreme Court Justice as he realized that a democratic government must balance societal inequities that industrial capitalism produces to represent the interests of all social classes. Everything from utility regulatory powers to setting up a social safety net were issues with which government has a legitimate role to preserve the pluralistic nature of liberal democracy evolving under a rapidly changing political economy. Serving in the court during the tumultuous interwar era, Brandeis recognized the contradictions of capitalism and democracy, stating that: “We can have democracy in this country or we can have great wealth concentrated in the hands of a few, but we cannot have both.”

During the “Warren Court” era under Chief Justice Earl Warren, 1953-1969, America actually made moderate progress toward realizing the democratic goals of the Constitution. Key constitutional amendments dealing with equal rights for minorities were ratified, while at the same time the political climate moved toward greater pluralism and tolerance and away from the apartheid conditions that existed before the Civil Rights movement. The Supreme Court in the recent decades, especially in the last two, has devoted itself to striking down all progress of the part with regard to equal rights, free speech, and due process, while using free speech to strengthen the role of big capital.

At the same time, the Supreme Court ruled in favor of violating human rights when it came to Guantanamo Bay detainees, in direct conflict with the UN Human Rights Commission. That the US Supreme Courts fails to safeguard human rights and civil rights, while using Constitutional amendments to strengthen the wealthy is indicative how far from the people and from any sense of justice it has been and remains to this day. Supreme Court Justice Ruth Bader Ginsberg has warned that if there are no limits on campaign contributions, the result will be that a few hundred people will control the country. Justice Ginsberg recognized the dangers to democracy of massive wealth concentration just as did justice Brandeis several decades before her, but these were and remain minority opinions in the history of the Supreme Court. (Ian Millhiser, Injustices: The Supreme Court’s History of Comforting the Comfortable and Afflicting the Afflicted; Lawrence Goldstone, Inherently Unequal: The Betrayal of Civil Rights by the Supreme Court)

 

Islamophobia and Terrorism, and Right-Wing Politics

In the early 1990s, it appeared the Cold War as a way of life was coming to an end. However, the US would only replace it with counter-terrorism and simply transfer the anti-Communist ideology and institutions into the domain of anti-terror ideology and institutions, thus perpetuating the status quo. This was done in part because it was the only way to justify maintaining very high levels of defense spending, in part to keep the global imperial network as leverage for global hegemony, and in part to continuing forging a popular consensus around security issues. In the absence of Communism as a threat to Pax Americana, militant Islam had to be invented as a global security threat. First there was the imminent threat from Iran after the 1979 revolution, simply because Iran was no longer economically, militarily and politically obsequious to the US. Then the alleged security threat of Saddam Hussein became a massive regional threat to all of the Middle East and by extension to the US because Iraq. Finally, came 9/11 that allowed for the US-led global anti-terror campaign. All of these were massive threats to American democracy as far as both Republican and Democrat politicians were and still are concerned. The only question was the degree to which Islam jihadists posed the kind of threat the US government described. Secondly, is such a threat the underlying cause undermining democracy or is the government’s institutional structure intended to combat the threat the real obstacle to democracy?

If the war on terror had actually reduced instead of increased both the number of jihadists while lessening the culture of fear resulting from the institutionalization of counter-terrorism, then one could argue that it was worth the sacrifice of human rights and civil rights, of democracy, and social justice. The institutional structure – Homeland Security, “war on terror” unilateral foreign policy, and police-state methods that override all civil rights and human rights – remain in place in a country that calls itself a ‘democracy’ and committed to spreading its values, rather than economic imperialism throughout the world.

According to one poll, only 20-40% of Americans were immersed in fear one year after 9/11, while in 2014 the fear factor ranges from 47% -65%. It is ironic that the wealthiest country in the world is terrified by a culture of fear that the media, both conservative and liberal, reinforces on a daily basis. This is largely because the elites have succeeded conditioning the majority of population to subordinate their democratic impulses to the “emergency security state” as though the US is in perpetual war. The end result is an inward-looking population afraid to question the existing social order and political regime that values conformity far more than it does pluralism, equality, and freedom.

While the mass psychology of fear may appear counterproductive to those advocating pluralism, democracy, equality, social justice and creativity as core values in society, as far as the political, social and economic elites are concerned the culture of fear helps to engender conformity at all levels and helps to maintain loyalty to the existing social order and political economy that strengthens the hierarchical structure. The domestic implications of the counter-terrorism regime can be seen on the role of city police departments toward black males and minorities in general. Islamophobia has wider implications of how authorities see illegal immigrants from Latin America and blacks. The idea that the minority is the enemy is deeply rooted in the culture of intolerance by the white majority toward the non-white minority. White there is videotaped evidence of repeated patterns of behavior on the part of the police toward minorities the mainstream media continues to defend the police forces, focusing not on the political culture of intolerance but on the “unusual singled out” action of a cop killing a black male. The challenge of American democracy in the 21st century is to leave the culture of fear behind, something that cannot be done unless the government abandons the political culture of counter-terrorism targeting Muslims as though they are the new Communists about to take over Omaha from the good Christian folk.

When one listens to right wing talk radio and watches TV programs such as FOX News, listens to right wing politicians demonize Muslims and castigate Latin immigrants, it is easy to understand why a segment of the American institutional structure has abandoned all pretenses to dealing with citizens of a democratic society. Just as there is a crusade to hunt down and kill militant Muslims in Afghanistan, among other places, similarly there is a crusade against minorities at home if their class status does not transcend their ethnicity and race. All along, the Justice Department has done nothing about the sharp deterioration in tolerance at the institutional level, let alone at the cultural that receives its messages from the media. (Carl W. Ernst, Islamophobia in America: The Anatomy of Intolerance; Clifford A. Kiracofe, Dark Crusade: Christian Zionism and US Foreign Policy)

The evangelical wing of the Republican Party has opportunistically used the “war on terror”, just as it used the anti-Communism during the Cold War to promote its own agenda and elect officials who embrace that agenda. It is not that the Republican evangelicals believe they can create a theocracy, but they know that they can use the counter-terrorism issue just as they used the Communism issue to engender sociopolitical conformity, and distract the American people from social and economic interests impacting them. Using religious fanaticism to polarize society and maintain conformity and a docile population, the government and media add the moral-religious dimension to foreign policy issues intended for domestic political consumption. This undermines the very fabric of America’s pluralistic tradition and poses a major challenge to democracy. If the evangelical wing of the Republican Party did not have behind it millionaires and billionaires supporting its agenda, and if it did not have the mainstream media, then its voice would be a faint one. What makes it powerful is the big money hiding behind the message, not the message. (David Green: The Biblical Billionaire Backing The Evangelical Movement; FORBES, October 8, 2012; William V. D’Antonio, et al. eds., Religion, Politics, and Polarization: How Religiopolitical Conflict Is Changing Congress and American Democracy)

The assumption that the threat to democracy is coming from out there somewhere, from evildoers whether they are Islamic jihadists or Russian nationalists is utterly absurd. Democracy falls from within under its own weight when it deviates from the social contract. The great Athenian writer Aristophanes realized this 2,500 years ago. American journalist and Presbyterian minister Chris Hedges argues in “How Democracy Dies: A Lesson from the Master” (Aristophanes) that society decays from within by corruption, greed, arrogance, distortion of ideals designed to promote the welfare of all people, and of course perpetual militarism that debilitates society and ultimately contributes to its demise.

“There is a yearning by tens of millions of Americans, lumped into a diffuse and fractious movement, to destroy the intellectual and scientific rigor of the Enlightenment. They seek out of ignorance and desperation to create a utopian society based on “biblical law.” They want to transform America’s secular state into a tyrannical theocracy. These radicals, rather than the terrorists who oppose us, are the gravest threat to our open society. They have, with the backing of hundreds of millions of dollars in corporate money, gained tremendous power. They peddle pseudoscience such as “Intelligent Design” in our schools. They keep us locked into endless and futile wars of imperialism. They mount bigoted crusades against gays, immigrants, liberals and Muslims. They turn our judiciary, in the name of conservative values, over to corporations. They have transformed our liberal class into hand puppets for corporate power.” (Chris Hedges, Democratic Underground, October 2010)

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Part 1: 21st Century challenges to American democracy

April 26th, 2015

 

By Jon Kofas.

 



 

Abstract: It requires several hundred pages to address the complex subject of challenges to American democracy in the post-Cold War era of a global multi-polar economic and political power structure. In this brief essay, I identify only a few of the current challenges to American democracy that appear permanent fixtures of society in the early 21^stcentury. The objective is to provide but a sample of some issues, regardless of how the corporate media, government, and presidential candidates wish to define challenges to democracy.

 

Introduction: Erosion of Public Confidence in Liberal Democracy

From the writing of the Constitution until the present, there have been many challenges to American democracy. This reflects an ideological struggle between those closer to John Locke’s classical Liberal model of government and those advocating a social democratic model based on jean-Jean Rousseau’s view of the Social Contract.

One of the first challenges to America’s liberal democracy intensified in 1805 during the Federalism vs. Democratic-Republican controversy (10^th Amendment) that was not resolved until Civil War (states’ rights issue with slavery at the core – 14^thAmendment). A second significant challenge came during the early years in the Age of Progressivism (1900-1920) the struggle to modernize the state to reflect the industrialization of society, to rationalize capitalism and balance pluralistic interests against the very rich demanding control of all institutions from the press to politics was a challenge that made its return in the Great Depression when FDR strengthened the central government and used it to keep capitalism afloat amid its self-destructive course. The last major Constitutional challenge manifested itself during the Cold War followed by the institutionalization of counter-terrorism culminating in the Patriot Act that remains a very serious threat to the US constitution and the tradition of liberal democracy. At the core of national security issues if the violation of the 4^thAmendment dealing with privacy and 6^th Amendment dealing with due process. (Joe Kay, Deal to renew USA Patriot Act extends police-state measures; Tom Carter, 13 December 2005; Capitalism, war and the collapse of democracy  22 April 2015 – World Socialist http://www.wsws.org/en/articles/2005/12/patr-d13.html)

Despite America’s history as a former European colony that would emerge to emulate the imperial motherland, similar challenges confront other open societies as well. Depending on one’s ideological perspective, such challenges can be anything from corporate institutional hegemony to lack of respect for human rights, as far as progressive analysts are concerned, to lack of a strong defense and absence of tough policy on illegal immigrants, according to right wingers. To left-of-center critics, the challenges to American democracy are invariably associated with the dismantling of just about everything that the FDR and to some degree Kennedy-Johnson administrations created as part of a pluralistic multicultural society. The Tea Party movement within the Republican Party has its own list of challenges to American democracy, and those focus on immigration, gun ownership, and complete deregulation of Wall Street. Ironically, everyone from Tea Party Republicans and Libertarians to liberal and leftist Democrats and claim Jeffersonian democracy expresses their ideological position. (Andrew Burstein, Democracy’s Muse: How Thomas Jefferson Became an FDR Liberal, a Reagan Republican, and a Tea Party Fanatic, All the While Being Dead)

Some of the challenges facing the US also confront many other developed countries, including all of the richest nations on the basis of GDP. America’s history, traditions and institutions distinguishes it from Europe as well as Canada and Australia for that matter, despite their common heritage as British colonies that industrialized and moved into the core of the world capitalist system. As the world’s economic and military superpower for the last six decades, the US has a different set of challenges confronting its democratic institutions than any other nation on earth. The inherent contradiction between liberal democracy at home and economic imperialism backed by a global military network has always been irreconcilable and will remain so in this century as the US will more than likely become even more militaristic in ordert to counter-balance China’s rising economic and political hegemony.

In so far as democracy operates under the political economy of international capitalism that shapes institutions and molds the class structure, it is inevitable that challenges in American society have common characteristics with other countries far less militaristic than America. Clearly, official corruption, minority rights, human rights, and elitism that the political economy produces, to mention just a few, are challenges in all democracies and they are permanent no matter how ephemeral politicians try to portray them.

Beyond presidential elections that generate vacuous rhetoric about “change” when in fact the basic institutional structure remains unchanged there is the larger question of the evolution of American democracy owing to objective economic and geopolitical conditions at home and abroad. The US is facing challenges of global economic preeminence from China, unconventional warfare around which the US has built an elaborate institutional counter-terrorism structure and culture, and massive social and economic problems at home that are becoming worse with every downward economic cycle.

Challenges to democracy are bound to test the republic in the future partly because China will replace the US as the world’s number one economic power at some point in this century – China is already ahead in PPP (purchasing power parity) terms. The US, which has been the world’s number one economy since 1872 when it overtook UK, will try to compete by placing even greater emphasis on its defense sector and military adventures. The US will continue the current policy of containment and destabilizing various parts of the world, while continuing with corporate welfare that has drained the economy in the last four decades. The result of this at home will be detrimental for the economy and the tradition of liberal democracy, and observance of the Constitution.

Do the American people have the same confidence in their government and institutions – political at all levels of government, media, educational and in corporate businesses – as the media tries to convince its audience? According to one public opinion poll, 75% of all Americans polled indicated they were “angry” with the policies of their federal government, albeit for different reasons depending on their ideological and political orientation. Naturally, people look to government for solutions to serious problems ranging from unemployment to living standards, but they also like to believe their government is fulfilling the social contract and not marginalizing the majority of the people to further the interests of the small minority.

According to Thomas J. Scott (“Democracy and its Discontents” Truthout.org ; January 2015), the Organization of Economic Cooperation and Development (OECD) data for 2013 indicates that only 35% of Americans have confidence in their government. Statistics are even worse among young people who simply become disengaged from the political process. A Rasmussen poll indicates that a tiny 8% of all voters have confidence in US Congress doing a good job, and a Gallop poll suggests 44% approve of the Supreme Court, while a Rasmussen poll for December 2014 notes that more than half of the citizens disapprove of Obama.

While one could argue these are not bad statistics when compared with approval ratings for governments in other developed countries, similar public opinion poll results for European and non-European countries only prove a general decline in confidence for open societies that claim to the name democracy but fail to deliver what the majority believe is the democratic social contract. Again, the percentage of young people dropping out of the political process completely is rather common, reflecting the high level of youth unemployment and expectations of their government vs. reality of “bourgeois democracy” as it is shaped in each country reflecting its dominant culture and heritage.

It is of interest to note that public opinion polls show a sharp drop for democracy and capitalism (from low 70^th percentile in favor in the early 1990s to mid-30s today) on the part of people across all of the former Soviet republics. This includes Ukraine where a minority of the population turned to neo-Nazism (SVOBODA) under the guise of freedom and democracy. The reason for the drop in public support of democracy and capitalism is largely because the dust has settled and people have now seen that behind the mask of democracy is a small clique of oligarchs on whose behalf government conducts policy.

The lack of confidence in public and private sector institutions in the US, and other open societies reflects a widespread recognition that these only serve the interests of the small privileged political, social, and financial elites to the exclusion of all the rest. Despite this reality, the corporate-owned media would have the public believe that the single most important challenge to democracy is none other than“foreign threats”. Government must meet these “foreign threats” by becoming even more militaristic in its foreign/defense policy, and more authoritarian at home, all in the name of imposing conformity.

 

Media-defined Threats to Democracy

On a daily basis, the mass media projects the image that the threat to American democracy comes mainly from abroad and from domestic violence that includes everything from petty crime to gun violence by some emotionally unstable individual. Large crimes that involve billions of dollars in banking scandals are hardly a threat to the integrity of the political economy. In short, the neighborhood burglar and foreign and domestic security are newsworthy, while rarely is the challenge to democracy the growing inequality gap, persistent culture of racism, political alienation by the majority of citizens, to mention only a few problems of major societal significance. Meanwhile, all the media and political focus stays on Islamic unconventional warfare – “terrorism”, Russian foreign policy, Chinese economic hegemony, North Korean adventurist statements and military exercises threatening America’s regional allies, and defiant states such as Syria, Venezuela, Argentina, Iran, etc.

Almost every Republican Party politician embraces the theme of a foreign enemy threatening American democracy. Therefore, the response to such ominous challenges is a massive military buildup and military solutions to international conflicts, so the people at home “feel safer”, regardless of whether they are actually safer. In the absence of the Cold War because there is no longer a Warsaw Pact but under the persistence of Cold War institutions and policies of containment, surveillance, counterinsurgency and militarism, the US has redefined and subordinated democracy to “emergency politics”invariably associated with a state of war or national emergency. In this manner, the government can justify everything from unilateral military interventions to violating the Constitutional rights of its own citizens. Using the politics of “foreign enemy distraction” government uses the fiscal system to favor the top ten percent of the population, while slashing social and environmental programs. (Des Freedman Daya Kishan Thussu, Media and Terrorism: Global Perspective; Bonnie Honnig, Emergency Politics: Paradox, Law, Democracy; Pippa Norris, Montague Kern, Marion Just, eds., Framing Terrorism: The News Media, the Government and the Public; Douglas Kellner, Media Spectacle and the Crisis of Democracy: Terrorism, War, and Election Battles (Cultural Politics & the Promise of Democracy)

Populist rhetoric on the part of the two major political parties is the key in convincing public opinion that “the foreign enemy” threatens democracy and freedom, both in increasingly short supply because of “emergency politics”. Populist rhetoric is the catalyst for winning elections for both the Republic and Democrat parties and for defining democracy and its threats real and perceived in the manner that engenders optimum sociopolitical conformity and distracts from issues significant to the larger population. While Republicans and Democrats agree the threats to democracy are terrorism and foreign enemies, it is mostly Republicans that subscribe to a xenophobic and Islamophobic, often latent racist agenda targeting Latin American immigrants who make up the cheapest labor force, African-Americans, and Muslims.

Perception and reality of what threatens American democracy are two different things, just as there is a huge gap between what politicians promise and what they actually deliver. The populism of the ruling parties in the US is also a characteristic of Europe where both conservative parties and center-leftist under the label of“Socialism” employ similar rhetoric but wind up supporting globalization, neoliberal policies, strong defense and weak social programs, all resulting in downward social mobility of the middle class. (Claire Snyder-Hall and Cynthia Burack, eds., Right-Wing Populism and the Media; Daniele Albatazzi and Duncan McDonnell, Twenty-First Century Populism: The Specter of Western European Democracy)

If indeed people care more about safety and security, or at least if the media and their political, business, and social leaders convinces the public that nothing matters more than safety and security, people will voluntarily surrender any commitment to democracy for the perceived guarantee of safety and security. If the US moves increasingly toward a more authoritarian model under the political shell of “democracy,” as it could if in the future it faces more and deeper economic contractions that result in an increasingly smaller and weaker middle class, the cause will not be the UN, the WTO, Islamic“terrorism,” rogue nations like North Korea, etc.

 

“Military Keynesianism” in the Age of Counter-terrorism

It is not as ironic as it may appear that American democracy is facing more challenges in 2015 than in 1950. This is because the East-West confrontation (Cold War) provided a consensus that the “war on terror” has not replaced as the Republican and Democrat parties had hoped. The breakdown of consensus revolves around the huge gap between what government, business and media promise and what actually transpires in society. The “open society” would deliver even greater rewards because the Communist threat does not exist. However, there is continued downward socioeconomic mobility and decline in personal freedoms for the vast majority of citizens and not much hope the future has the American Dream in store for most people.

For conservatives the solution is “Military Keynesianism’ an early Cold War containment military doctrine refers to defense spending as a means of stimulating the civilian economy by allowing the surplus to be absorbed by the defense sector. This was feasible when the US enjoyed balance of payments surplus in the early 1950s, but in 2015 when its public debt surpasses its annual GDP, “Military Keynesianism” is obviously destructive, especially when combined with the policies of corporate welfare capitalism where the state essentially is steering subsidies and contract to private companies to keep them healthy. (Jerry Sanders, Peddlers of Crisis: The Committee on the Present Danger and the Politics of Containment).

The result of this doctrine can be seen in the immense US sovereign debt that has been skyrocketing in the last fifteen years, as we will see below when analyzing debt as a challenge to American democracy. Moreover, the doctrine of “Military Keynesianism” has weakened the economy with the middle class and laboring classes as the victims paying the price. As David Shreve points out: “Because they sap the strength of the already bastardized Keynesianism built on the weak reed of the defense industry multiplier, the lingering advantages of Keynesianism itself become attenuated even further, devalued and increasingly misconstrued in political circles, and felt only perversely by most affected citizens. “Making the eagle scream” as John Dos Passos once described it, to compensate partly with ever increasing military expenditure, can postpone some of the reckoning, just as it did in the last days of the Soviet Union, but it cannot stave off the inevitable weakening of the overall economic fabric.” (David Shreve, “Defense Spending and the Economy: The Pitfalls of Military Keynesianism”. @War IS A Crime.org

By itself, “Military Keynesianism” does not constitute a threat to American democracy, but when put in the institutional context of a state that violates the constitution by keeping its citizens under surveillance, denying human rights to prisoners, denying due process to citizens, and expanding the “counter-terrorism”institutional structure to the degree that “security transcends democracy”,then there is a very serious problem. The continuation of “Military Keynesianism” and pursuit of counterterrorism measures used as a pretext for police state methods benefits the political, economic, and social status quo. At the same time, counterterrorism precludes societal progress to the benefit of all people, social justice, and above all democratic practices. The result of the “military-solution based foreign policy” invariably weakens democracy at home as domestic institutions mirror the military foreign policy regime.  (David C. Unger, The Emergency State: America’s Pursuit of Absolute Security at All Costs; James Petras, The New Development Politics: The Age of Empire Building and New Social Movements .)

The irony about “Military Keynesianism” is that its congressional advocates castigate government spending as counterproductive to the free market system, as though such a market exists, but they have no problem with government engaged in deficit financing to dish out contracts to the defense industries. The argument is that despite deficit financing, defense spending, inherently capital-intensive rather than labor intensive, creates jobs as though non-defense spending such as infrastructural development is detrimental to jobs growth. “Because the combination of defense spending, massive tax cuts, and the bailout had led to large budget deficits, the proponents of this perverted military Keynesianism insisted that programs for productive government expenditures had to be cut in the name of fiscal responsibility to make way for (wasteful) military spending.” (Michael Perelman, “The Rise of Free-Trade Imperialism and Military Keynesianism” , May 2014, @Naked Capitalism.com)

At the core of this doctrine that goes back six decades rests the assumptions that: a) the US as an imperial power has enemies that refuse to accept its political, economic and military integration model; and b) whether it is the East-West conflict as its evolved during the Cold War or the ongoing “war on terror”, conflicts between the US and its “enemies” have an inherent military solution. Given that such assumptions impede on the nature of the economy and social structure as well as on the kind of democracy the US has, “Military Keynesianism” will remain a major threat to democracy in the 21^st century.

 

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Geopolitics, austerity and neo-liberalism: Greece, the EU and the US

April 17th, 2015

 

By Jon Kofas.



Until very recently, the media throughout the world called the Greek SYRIZA party everything from “far left” to “radical far leftwing”.  Once the center-left party with a mass base made up of middle class and workers took power in Greece in late January 2015, it was very clear that the leftist rhetoric was indeed critical of austerity and neoliberal policies. Euphoria abounded within Greece and throughout the world among anti-austerity and anti-neoliberals who believed that growth and development were sacrificed for the sake of capital concentration at home and abroad. Very quickly, however, SYRIZA fell in line under pressure from the international media, domestic and foreign businesses, and of course from governments especially Germany, but also the US and even China that demanded conformity.

The mass media as well as independent blogs around the world have analyzed the political, social and economic consequences of the Greek public debt crisis more than they have other countries, including Spain and Ireland that are far more significant in terms of economic impact to the EU than Greece. One reason for this obsession is that Greece has been technically bankrupt since May 2010.  The possibility of an unmanaged and uncoordinated bankruptcy could possibly throw the EU economy off by at several hundred billion to as much as a trillion euro, assuming it leaves the euro zone. This would then open the road for the neo-Fascist French National Front to demand that France exist the EU, thus threatening the integrity of the European Union with the inevitable consequence of a cheap reserve currency that would result in disequilibrium in European balance of payments and disequilibrium in world trade.

The theme of the mass media representing big business has been very simple: Greece must accept austerity and neoliberal policies regardless of the cost to the vast majority of its people because it has no choice for the greater good of the markets. The alternative (economic nationalism with a mix of mild social-democratic measures) to EU integration is much worse and it sets a terrible precedent for other EU members and non-members. Trying to drive fear into the politicians, military, business community and ordinary citizens of Greece has actually succeeded. This despite the very obvious result of austerity making the economy much weaker, finances becoming even more strenuous, and the social fabric disintegrating as Greece has a much higher percentage of poverty rate than Argentina; a country that the Western media and governments have targeted for derision and isolation.

The burden for all of this would fall not just on Greece but actually on Germany that has in fact driven the country into a corner either to accept austerity and neoliberal policies no matter the degree to which the workers, middle class and social security recipients become impoverished. The propagandistic rhetoric on the part of the Western media that it really means nothing to the EU in case of a Grexit is very hollow and economists know this as well as politicians. Grexit will set off another global recession amid a GDP slowdown in Asia and stagnation in Europe and Australia impacted by the slowdown in China.

Complicating matters, the reality is that Greece is financially dependent on Germany but militarily dependent on the US with which it had a long-standing alliance from the Truman Doctrine to the present. This dual dependence is the reason for the intrusive role of the US in this matter, much to the dismay of the German government that resents Washington playing its military protector card. The debt crisis was the result of Western banks and the European Central Bank cutting off Greece from liquidity it needed to continue functioning, making borrowing very expensive after rating agencies downgraded it bands and the private market because too expensive.

Between 2015 and 2022, servicing the public debt amounting to about $365 billion is simply not possible under existing conditions, that is, in the absence of some kind of a new arrangement that would permit the government to meet its domestic obligations and public debt. In 2015 alone, debt service is about $30 billion, in country with GDP of about 175 billion euro. In other words, debt service for 2015 alone represents approximately 13% of GDP. The IMF and European Central Bank are due to receive half of the payments and the other half for holders of treasury bills, which include entities from Greek banks to the Chinese government. Prime Minister Alexis Tsipras delivered the following speech on the debt, explaining why the EU and IMF must reconsider their position on austerity and loan conditionality that impacts all levels of policy in Greece.

In 2010, the Greek state ceased to be able to service its debt. Unfortunately, European officials decided to pretend that this problem could be overcome by means of the largest loan in history on condition of fiscal austerity that would, with mathematical precision, shrink the national income from which both new and old loans must be paid. An insolvency problem was thus dealt with as if it were a case of illiquidity. In other words, Europe adopted the tactics of the least reputable bankers who refuse to acknowledge bad loans, preferring to grant new ones to the insolvent entity so as to pretend that the original loan is performing while extending the bankruptcy into the future. Nothing more than common sense was required to see that the application of the ‘extend and pretend’ tactic would lead my country to a tragic state. That instead of Greece’s stabilization, Europe was creating the circumstances for a self-reinforcing crisis that undermines the foundations of Europe itself.

From the birth of the Bretton Woods system that created the International Monetary Fund (IMF) and the World Bank, debtor nations unable to service their debt because borrowing becomes too expensive must follow a regime of fiscal austerity, higher indirect taxes falling on the workers and middle class, and drop in living standards owing to slashing of wages, social programs and rise in both cost of goods and taxes.

Presumably, this monetarist model would be the panacea for the debtor nation. However, in the last fifty years countries under austerity winds up in transferring massive wealth by servicing the public debt and capitalists taking money overseas, thus leaving the debtor nation poorer, its asset values – everything from real estate and businesses to wage rates – much lower thus permitting massive domestic and foreign capital to take over and concentrate wealth even more than before. The end result is greater external dependence. In the case of Greece, however, we have a country financially dependent on North-West Europe, especially Germany, but militarily dependent on the US.

This contradiction of split dependence has cause some friction between Germany and the US, because the former was strict compliance with austerity and neoliberal policies that would ensure Greece as a neocolonial dependency, while the US is concerned that the geopolitical value of Greece is more significant than its economic amounting about 2% of the EU GDP. The objective of Washington has been to keep Greece militarily integrated into the West, to make sure it continues to keep up with military budget as NATO prescribes, and not deviate at all by trying to explore the Russia and Chinese cards as symbolic counter-weights to the West.

The US naval bases in Crete and US intelligence operations in the country are more valuable to Washington than Germany trying to prevail over Greece to the point of driving it away from the West and to the point of endangering its internal political and social stability. In November 2012, the conservative government of Antonis Samaras hired the notorious Blackwater security services (mercenaries) now known as Academi infamous for its clandestine operations in Iraq, Afghanistan, Syria, Abu Dhabi, Libya, Ukraine, and a number of African countries. This is a security company with deep links both to the US government (Central Intelligence Agency) and the corporate world, but it also has ties with governments around the world.

Under contract to work with the police to make sure the regime is protected, Blackwater acted from behind the scenes, indicative of how fearful both the pro-austerity conservative regime and the US were about the country lapsing into revolutionary chaos. This is the same Blackwater that has four of its operatives recently sentenced to prison because in 2007 they killed 14 Iraqi civilians, albeit operating under contract with the US government that has used their services for “contract work” in many countries. What the company describes as “logistical support services” are in essence privately contracted counter-insurgency operations, including assassinations according to the New York Times(C.I.A. Sought Blackwater’s Help to Kill Jihadists” Mark Mazzetti, 19 August 2009) on behalf of governments and multinational corporations that fear popular opposition to policies that result in exploitation of labor, natural resources, and environmental degradation.

For obvious reasons, the contract between Greece and Blackwater was kept secret until the Greek Ambassador to Canada let it slip out in one of his public appearances. The conservative government of Antonis Samaras never admitted that Blackwater was operating in Greece. SYRIZA as opposition knew that this mercenary company operated in a number of trouble spots around the world on behalf of the US and other governments. SYRIZA was concerned that Blackwater had a key role in preparing the Greek police and military for the possibility of suppressing the popular expression of democracy through grassroots organizing.

While Tsipras was willing to accept Greek military dependency and US strategic interests, he hoped in exchange Washington would help the government dealing with Germany and the IMF. The center-left government of SYRIZA, essentially a collection of leftist academics, former PASOK party members and some former euro-Communists, found the hard way that as long as Greece remains in the EU, Germany determines the terms of the integration model, which means Germany determines austerity and neoliberal policies for the member nations. It is not clear if SYRIZA expected the IMF, EU and the media to make compromises just because there was a tacit understanding Athens would retain its strategic loyalty to the US-NATO. In reality, SYRIZA found out the hard way that dealing with hard-core “political and economic criminals”, as some of its officials called them when in opposition, means the latter have vast experience imposing their will over periphery debtor countries.

Cornered by the immense pressure of the German-led coalition, by the wealthy Greek elites, the conservative political parties and the military, SYRIZA simply accepted austerity and neoliberal policies, asking for terms that could be met in servicing the debt and domestic policies that would not further entail higher unemployment currently at 26% and more wage, benefit and social security cuts. Trying to use the Russian card with a visit and a natural gas deal meant very little, although Athens has asked both Beijing and Moscow to purchase treasury bills. The faint attempt to use the US as the country’s military patron as a counterweight to Germany has not worked well either. Alexis Tsipras is not Josip Broz Tito and Greece is not Yugoslavia that could play East against West, and the leverage he has is limited to geopolitical issues in a tumultuous part of the world.

On 15 April 15, 2015, the Reuters Moscow office reported that Greece is negotiating to purchase S-300 missiles. Although this may be a shock to the Western anti-Russian media, Athens has used as part of its air defense system in the last two decades. The irony here is that Vladimir Putin promised better terms on natural gas sales to Greece, but the quid pro-quo was weapons purchases from Russia must be part of the deal. This is exactly what France and Germany have been doing with Greece from 2010 until the present when Greece has been under austerity. The Western media is critical of this deal asking “where is Greece finding the money to buy S-300 missiles”, the same ones that Moscow recently decided to sell to Iran amid the final stages of the US-Iran deal on nuclear weapons development.

The larger question is why is Greece under a supposedly leftist SYRIZA government continuing to spend on defense at rates about the same as before austerity (about 3% of GDP, or one of the highest in the world, while the EU average is under 2%)? Once again, there has been immense pressure on Athens by Germany and the US not to cut defense, just wages, social security benefits, social programs, especially health care and education. Tsipras decided to cut a deal with Putin that essentially is not much different than the quid pro quo deals Greece has with the West, hoping Russia increases trade with Greece and purchases T-Bills while discounting natural gas sales.

The US wants Greece in the EU for strategic reasons, and it would not mind if Germany makes a few symbolic concessions to show that it is not a heartless neo-colonial power in Europe as its critics have portrayed it. However, Greek politicians and analysts are deluding themselves if they assume that the US would sacrifice its relationship with Germany to support Greece on austerity and neoliberal policies. The most likely scenario is that SYRIZA will cave into German-US pressure to conform on austerity and neoliberal policies. A more distant possibility is everything from referendum to new elections that would not really solve anything, to Greece leaving the EU eventually.

The lesson of Greece to the rest of the world is that the so called “leftist” SYRIZA party that had promised to end austerity and neoliberal policies was unrealistic. The result was following in the footsteps of the conservatives and PASOK socialists that alternated ruling the country in the last forty years and followed policy dictates of the EU (Germany) and IMF. The disillusioned voters of SYRIZA that has blatantly lied about what policies it would pursue once in power have nowhere to go. SYRIZA lacks ideological cohesion as there are elected officials and ministers that range from the traditional liberal center within the Greek context to the Socialist – Euro-Communist wing of the Greek Communist Party after it split.

The cacophony of disparate voices accounts for confusion among voters. The political and ideological heterogeneity has been deliberate so the party can reach a wide voter base. As PM and head of the party, Tsipras has opted to isolate the left when it comes to financial and economic policy, but engage it only on certain social issues such as illegal immigration, and to deliver a leftist message to the people desperate for radical solutions. Andreas Papandreou in the 1980s was a master at this political game, and it seems that young Tsipas is following in the footsteps of the former PASOK leader who at least managed to create a middle class through inflationary policies and foreign borrowing when Greece enjoyed monetary sovereignty.

The message that SYRIZA’s volte face sends to Europe is that no EU member can possibly challenge German hegemony, largely because the entire capitalist world support austerity and neo-liberalism. In other words, beyond the small confines of Greece, it was important for Germany to demonstrate its economic and political power so that its integration model based on patron (Germany) client (periphery EU members) relationship will continue and make Germany even stronger while enriching European banks and multinational corporations that support austerity and neoliberal policies.

The Greek Communist Party (KKE), the only Stalinist remnant of the Cold War in Europe with a mere 5% popular voter support, had warned the voters that the SYRIZA option to remain integrated into the EU meant there would be no solution much different than what Greece had under PASOK and New Democracy (both neoliberal) governments in the past. Greece under SYRIZA learned reformism does not work any more today than it did in the 19^th or 20^th century because leverage rests with the counter-reformist political and economic powers. Reformism works only when it starts with the core capitalist countries, not the periphery. This does not mean that SYRIZA did not have options to exercise or that it is now too late to take bold steps. It only means that it is just another conventional bourgeois political party opting for more “enlightened capitalist” solutions within the system in a world made up of predatory capitalists and their neoliberal political representatives.

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Public Policy and happiness: A historical overview

April 8th, 2015

 

By Jon Kofas.

 



 

It stands to reason that all human beings (assuming free of mental illness) want to be happy, content or at least have positive feelings and harmony in their lives. However, happiness is very subjective based on brain chemistry, individual mental state, and character disposition, none of which can be subject to public policy, except in so far as a country’s health system and social programs are concerned. Happiness is also based on individual, family, community, religious or secular criteria that may include a combination of factors from health to money, from achieving one’s career goals to securing upward social mobility for one’s children, from mastering the complexities of quantum theory in physics to traveling around the world for the mere joy of it, and so much more.

It is also possible that some people may not want to entertain positive feelings, or be “happy” because negative feelings, lack of contentment or unhappiness provides an existential sense of being, feeling alive and empowered through negative energy because there is purpose in life for which to strive. There is also the element of happiness and cultural relativism that accounts for different perceptions of this concept in different cultures. What may constitute happiness for a Wall Street stock broker is not the same as a small farmer in Kazakhstan. As we will see below, the concept of happiness in the individualistic West is different than it is in societies where collectivist or communitarian values prevail. In all cases, of course, human beings have basic needs that must be met for survival and those essential common needs transcend cultural differences and nuances in what constitutes happiness.

Finally, there is the whole notion that happiness is an illusion like so many others people entertain in order to cope in life. If we accept that narcotics induce a sense of euphoria owing to stimulating effect and disruption of neurotransmission, then happiness as a state of mind may be another illusion that the media and societal institutions in general have inculcated into the mind of people. Can the state provide the illusion that people are happy? Of course it can and it always has by projecting an image of grandeur and the best possible society citizens can live in, an issue with which French thinker Voltaire dealt in his brilliant novel Candide. If government and its rulers endeavor to project the “best of all possible worlds” idea as Voltaire’s novel satirizes, then people are either duped or they live vicariously through the lives of others who are satisfied with their lives.

Ideological commitments determine where scholars side on the controversial issue of public policy and human happiness. For some, there is a demarcation line between personal and societal welfare where public policy has no role to play in the personal domain for it would mean legislating morality. This reflects an ideological preference toward classical Liberalism, while those more accepting of collectivism in society see public policy as playing a role in both community and individual well-being. A Marxist and even some non-Marxist Socialist would argue that human happiness is economically determined and class based.

Depending on the ideology, so goes the analysis and conclusions about the merits of public policy and happiness. It must be stressed, however, that these are not absolute and constant concepts because the epoch and place determine their nature. Besides the issue of cultural relativism, all of this assumes rationality in human conduct when in fact that is not a valid assumption. The absurdity of society where everything from wars to individual violence takes place, from mass poverty to institutional prejudice poses monumental obstacles to human happiness. The question is whether government can and must help remove such obstacles to societal happiness by promoting greater social justice, even while religion and meditation offer spiritual comfort to help people cope individually.

Public Policy and Societal Happiness

Does public policy affect societal happiness or by contrast create or perpetuate societal misery? From ancient times to the present, many thinkers from different disciplines have argued this is indeed the case. Others insist that happiness is strictly an individual endeavor, thus happiness is strictly and individual matter and the domain of private morality and religion.

If public policy has a direct and indirect influence in peoples’ quality of life, it is because of fiscal, economic, social, and foreign/defense policy. In this case, the role of the state becomes central to societal happiness or misery. If public policy benefits only a privileged segment in society, then it stands to reason that happiness is legislated for a narrow social group at the expense of the majority which remains in perpetual misery as a result of prejudicial public policy.

With the rise of mass politics in the 20^th century, with capitalism weakening parliamentary democracy rooted in a social structure that requires a strong middle class base, there are scholars, politicians, journalists, trade unionists, students, and social activists arguing for public policy intended to engender societal happiness.  More interested in social justice than they are in the success of market hegemony, critics of the dominant culture and capitalist political economy see public policy impeding societal happiness.

Although the mass media and politicians equate success and happiness with market performance, and although the market has a determining role in the lives of people around the world, happiness and the sense of satisfaction for the vast majority does not hinge as much on markets as on how public policy impacts them. At the broader societal level, happiness in civilized society has always been a matter of social justice.

The reality of mass uprisings throughout the Muslim world in the last few years (Arab Spring), mass demonstrations in the US (occupy Wall Street movement, among others) and EU (especially Spain, Portugal, Greece, Italy, and France) against socioeconomic injustices and absence of political representation of all citizens, strikes and protests in Latin America (especially in Chile and Argentina) and Asia (especially Philippines, Thailand, Hong Kong and South China, Turkey, Cambodia, and Indonesia), all of these indicate a search on the part of those in the periphery of the institutional mainstream for social justice that many equate with societal happiness.

The challenge for politicians in the 20^th century as the era of mass politics is to forge popular consensus in order to govern effectively under the umbrella of the market economy amid tensions between nations that case numerous wars. The challenge for political leaders in the 21^st century remains essentially the same, except that the public, especially in Western democracies, is likely to make greater demands that public policy must meet the welfare of society and its broader happiness equated with a sense of fairness or social justice, and not special interests. The question of public policy and societal happiness or satisfaction as an integral part of the social contract is the key to successful government, more so today when instant global communications have raised the social consciousness of the masses.

While there is only one country, Bhutan, on the planet with a happiness index comparable to a GNP index, there is an underlying political interest on the happiness index as a measure of forging popular consensus. Just as some companies want happy and satisfied employees and customers, politicians wish the same for their constituents. Nevertheless, most politicians in the world today would oppose legislating “happiness” because it is an extremely high risk endeavor because this is the domain of utopian politics and an area filled with traps in case of failure to deliver on the social contract.

Regardless of a politician’s predisposition on this issue, laws have a positive impact on some social groups and negative impact on others. After all, this idea is as old as ancient Athenian leader Solon “the Law Giver” (638-558 B.C.) who believed that good or harmonious laws (Eunomia) account for a harmonious and happy city-state, while bad or unfair laws  (Dysnomia) result in chaos, misery and ultimately uprising of the citizens. Coming to power after the city-state was on the verge of revolution, Solon recognized that government has a role in social justice, which translates into harmony or disharmony in society and that in turn translates into happiness or unhappiness among the disparate segments of the population.

It may be realistic to believe that the political economy determines human satisfaction, positive emotions (happiness) or dissatisfaction or negative emotions (unhappiness) of citizens in the 21^st century when markets dominate public life and influence institutional structures and societal values. (For more discussion on this see Benjamin Radcliff, The Political Economy of Human Happiness: How Voters’ Choices Determine the Quality of Life (2013)  However, it is realistic to expect the state to intervene in favor of citizens and not the markets because citizens may reach a point of destabilizing or even overthrowing the regime.

In public opinion polls, there seems to be a correlation between countries ranking low on the “happiness scale” and citizens disliking their governments. Therefore, misrule entails a disgruntled population in our time as much as in the time of Solon and the near civil war conditions, or 17^th century England (Civil War and Glorious Revolution), 18^th century France, 1789), 20^th century Russia (Bolsheviks, 1917), China (Maoists, 1944-1949), and Cuba (Fidel Castro and Che Guevara Communists, 1950s).

Of course it must be stressed that societal happiness assumes a high level of national sovereignty where external forces do not determine policy. For example, how can we possibly compare societal happiness in Norway that enjoys national sovereignty and is listed as one of the world’s happiest nations with war-torn Afghanistan under foreign military occupation and subject to intermittent foreign intervention in its modern history? There are also cases with lower level of intervention and external dominance at the economic level, such as Latin American nations historically under the hegemonic influence of the US and Africa under Europe. How can the people of  Pakistan and the Central African Republic enjoy the same sense of autonomy and thus comparable societal happiness as the people of the US and France when the former have been subject to economic imperialism?

For the state to be an agent of societal happiness it must enjoy full autonomy, otherwise external agents determine societal happiness of its subjects. This is exactly what has been the case under the current globalization world order where there are patron and client states serving markets. Even if the role of the state is not to engender happiness in its citizens but to serve markets, do policies have beneficial impact on some who are much happier because they are institutionally privileged while others who are on the fringes and in misery because government policies keep them there?  If indeed the state has a Gross National Happiness (GNH) index as does Bhutan, does this not mean that the state is restricting the liberties of those wishing to exercise their own will and even to wallow in misery if they so choose? The goal of Bhutan, a small country between China and India, is to adjust policy based on GNH indicators (economic, social, political, environmental, individual physical and psychological).

Although GNH was set up for the well being of citizens, libertarian critics argue that we live in a Rousseau-type world where people must be compelled to be happy at the expense of their free will. However, Columbia University and private polling groups track world’s happiest and least happy nations, with criteria that some may find questionable and others may accept. The polls are not just an indication of measuring the reflection of public policy on citizens, but how stable a government may be so that investors feel safe with their money. For example, it is not surprising that the Scandinavian countries rank top in the world, while Africa and the Middle East rank among the lowest, while southern Europe undergoing austerity also rank among some of the world’s poorest nations. Nor is it a coincidence that the countries ranking at the bottom enjoy a low level of national sovereignty owing to dominant external influence at the economic, political and/or strategic levels.

Religion, Happiness and the Earthly State

In all civilizations throughout history, religion has been the source to which most look for happiness they associate with inner tranquility and a sense of satisfaction combined with the hope of redemption. While Western thought stresses the role of the individual in relationship to the state, in Eastern religious and philosophical thought the emphasis is on societal unity that reflects a cosmological unity, and systemic-collectivist approach to the issue. In both Western and Eastern religious traditions, the emphasis is the individual’s spiritual redemption and not the earthly goal of social justice that would deliver happiness through public policy.

In the Critique of Hegel’s Philosophy of Right, Karl Marx rejected religion as escapist illusion, a relatively cheap narcotic for the masses to alleviate the pain from earthly misery. After all, human beings live in the material world where the state and society produce religion and the elites use it as a conformity mechanism to perpetuate a privileged institutional structure. “The abolition of religion as the illusory happiness of the people is the demand for their real happiness. To call on them to give up their illusions about their condition is to call on them to give up a condition that requires illusions. The criticism of religion is, therefore, in embryo, the criticism of that vale of tears of which religion is the halo.”

German theologian Ludwig Feuerbach’s (The Essence of Christianity, 1841) assertion that the quest for happiness must form the basis of all morals because happiness is innate is a concept with roots both in pagan philosophy and Christian doctrinal tradition, especially in neo-Platonist Christian theologian Augustine, Bishop of Hippo (354-430 A.D.). Living during the declining years of the Roman Empire, he argued that people are not happy because they do not have what they want in life in terms of “earthly possessions”.

According to the theologian who set the doctrinal foundations for Catholicism in the Middle Ages what people need is spiritual love of God that is permanent. Submission to the Will of God is the only road to happiness. After all, the disappointments of life on this earth point the way to God. People, however, seek things of the earthly temporary world at a time of the declining Roman Empire that could not even offer protection from Barbarian invasions overtaking the Western provinces and sacking Rome (410 A.D.by Alaric King of the Visigoth), an event that inspired Augustine to write the City of God as the alternative to Rome, the city of man. By accepting the assumption that happiness is a goal of human beings, St. Augustine was merely saying that the church could deliver it where the state had failed and can never succeed. Such thinking was not unique to Western thought, but is also found in Asia much earlier than in the West.

The Buddha (Siddhartha Gautama, 563-483 B.C) also argued that the pursuit of material things, pleasure, immortality and all things of this earth make people miserable because happiness is rooted in the spiritual domain. One answer to human happiness is religion or spiritual contemplation intended to achieve Buddhist-like transcendence. Needless to say, there are differences between St. Augustine’s neo-Platonist Christian positions on happiness and those of the Buddha whose Upanishads-rooted teachings maintain that understanding the causes of (spiritual) suffering leads one to unlock the secrets to happiness. While the Buddha and St. Augustine offer spiritual solutions to human misery, neither had a practical institutional solution for misery caused by the earthly institutions. Not that one would expect theologians and spiritual leaders to provide “earthly” advice for people to be happy, for that is the job of those in other domains from medical science and the arts to public policy.

Without taking anything from the religious/spiritual emphasis to human happiness, there is the reality that people live as social beings in a material world becoming increasingly more so. Clearly, for many centuries religion was the domain to which people turned to find happiness largely because the City of God, as St. Augustine insisted was the place for permanent bliss, whereas the earthly city is where we encounter misery. Regardless of whether one accepts the religious/spiritual road or sees it as escapism,  modern materialistic culture is swimming in hedonism, becoming less spiritual as science and technology mold the human mind along with all aspects of life.

Tenth century Muslim philosopher Abu Muhammad al-Farabi combined the philosophy of Plato and Aristotle on human happiness as a goal of all people with Muslim doctrine of liberating the soul of material want and using this life as a testing ground for eternal happiness in the next. One would expect theologians to insist on the spiritual dimension and to have nothing to say about public policy as a means to achieve happiness, regardless of the strong evidence of social justice in society. Spiritual meditation and hopefully transcendence provides the vehicle to bring relief from misery, regardless of whether this is all inside the mind of the individual and has no connection to the empirical world.

Although religion and spirituality have their very powerful institutional advocates, this raises the question of how societal institutions, first and foremost the state, shaping human happiness in order to maintain social harmony. This is an issue that Solon (638-558 B.C.) raised when he was asked to design laws for the city-state of Athens about to lapse into chaos, revolution and civil war. This remains a key issue for modern society, whether religions step in to provide answers or the state and secular institutions. Eudaimonia or happiness is as important in classical (pagan) ethics issue as the concept of arête or virtue was very important in ancient Greece. Because classical thought rested on the concept of man as a social and political animal (Aristotle), namely, all activities of the individual are shaped by the very existence of living in a community it stands to reason that the state plays a role in eudaimonia or happiness.

Philosophical Approaches to Politics and Happiness

A universal issue that transcends time and place, public policy and happiness is an issue that Plato raised in the Republic, John Locke in Two Treatises of Government, Jean-Jacques Rousseau in theSocial Contract, and a host of thinkers from ancient times to our day. In Plato’s Republic, one notices the link between the sense of “justice” in the individual, presumably rooted in social justice, and happiness. This was probably the thinking of Socrates whose thought rested more on the heavens rather than earth, as Roman philosopher Cicero noted. Nevertheless, we have in ancient Athenian thought the link between happiness and justice of the citizen in city-state, although the concept of justice was invariably associated with virtue as well.

Just as Plato placed emphasis of the individual to determine his happiness by transforming himself as a just and virtuous citizen so did Confucius argue in favor of individual transformation, rooted in the “humanity” that makes one nobler. No doubt, Plato and Confucius represented the elites of their respective eras and societies, and neither had much concern for the lower echelons of society. However, the idea of applying a happiness principle in the political context was established in ancient times as it has been from the European Enlightenment (18^th century) to the present.

The European intellectual/cultural revolution that took place during the Renaissance and coincided with the Commercial Revolution entailed a “humanist” definition in the concept of happiness. The man-centered culture, the emphasis on life in this world, and above all the idea of creativity as a factor that accounts for satisfaction in life became themes that Renaissance thinkers developed, whether through art, sculpture, literature, poetry, or other aesthetic and scientific endeavors that fulfill human life. This intellectual revolution stressed human dignity and creativity amid changes in the social structure where a middle class and a capitalist economy were emerging. The commercial middle class challenging the value system and institutions of the feudal nobility associated with monarchies accounted for new perspectives on happiness as part of the social contract.

Such a perspective we find in the works of John Locke the father of Western Liberalism and the epistemology of empiricism. In his Essay Concerning Human Understanding, Locke argues that: “The necessity of pursuing happiness [is] the foundation of liberty.  The highest perfection of intellectual nature lies in a careful and constant pursuit of true and solid happiness; so the care of ourselves, that we mistake not imaginary for real happiness, is the necessary foundation of our liberty. The stronger ties we have to an unalterable pursuit of happiness in general, which is our greatest good, and which, as such, our desires always follow, the more are we free from any necessary determination of our will to any particular action…” 

By the time of Locke’s era of the Glorious Revolution (1688), northwest Europe had changed to the degree that the rising middle classes made the association between societal happiness and public policy through the legislative branch that Locke believed ought to be in the hands of all propertied classes, and not just the landowning nobility represented by the Tory Party. Along with the Glorious Revolution we have a shift in the value system because class structure changes demanded it, as they demanded political change that Locke articulated in his Two Treatises of Government (1689).The 18^th century brought about even greater changes in the bourgeois value system and even greater expectations of the government’s role in society’s happiness. However, the Industrial Revolution in England also created a sense of fear among the middle class intelligentsia because the greater wealth it created the more poor people emerged especially in London and other urban areas.

The American and French Revolutions formally placed the concept of societal happiness into the political dialogue by making it a core constitutional issue. To some degree the American War of Independence resulting in the Constitution codifies happiness as the excerpt below indicates.

“We hold these truths to be self-evident, that all men are created equal, that they are endowed by their Creator with certain unalienable Rights, that among these are Life, Liberty and thepursuit of Happiness. — That to secure these rights, Governments are instituted among Men, deriving their just powers from the consent of the governed, — That whenever any Form of Government becomes destructive of these ends, it is the Right of the People to alter or to abolish it, and to institute new Government, laying its foundation on such principles and organizing its powers in such form, as to them shall seem most likely to effect their Safety and Happiness.

The concept of Happiness during the War of Independence under those specific circumstances meant something unique that does not have the same meaning today. However, the basic meaning of the concept includes contentment with government, public virtue and success, indicating the inexorable link between citizen and the state entering the social contract as 18^th century Enlightenment thinkers envisioned it. Clearly, the influence here comes mostly from Locke’s Liberalism and to a lesser degree from Rousseau’s concept of social democracy. For Rousseau, man in the state of nature is essentially happy, but not so in civilized society where institutions corrupt and degrade human beings. Hence the opening line in the Social Contract: “Man is born free and everywhere he is in chains. One man thinks himself the master of others, but remains more of a slave than they are.”

Undertaking universal systemic changes in society, the French Revolution went farther than the American in promising to deliver the ideal society for its citizens. During the more radical phase of the Revolution under Maximilien Robbespierre, largely influenced by Rousseau, the state would be the ultimate arbiter of societal happiness. Many intellectuals, including Hannah Arendt, deplore that the French revolutionaries made societal happiness instead of individual freedom the center of their political agenda. Interestingly enough, Arendt reveals her Liberal bias and anti-Rousseau-Robespierre view by arguing that the Jacobins were promising something reflecting a “totalitarian” regime.

This is in contrast with the American Revolution founded not as much on Rousseau’s social democratic ideology that promises happiness part of public policy, but on Locke’s that only focuses on individual freedom and nothing more. In this respect, Arendt the Liberal actually sides with Edmund Burke the counter-revolutionary who applauded the American Revolutionary War that maintained the social and economic status quo, but deplored the French Revolution that tried to undertake system changes across society.

Addressing the issue of human happiness from a Christian moral perspective but with a sense of realism rooted in the Industrial Revolution, Thomas Malthus (An Essay on the Principle of Population, 1798) linked the asymmetrical rise of the population to the exhausting demand for natural resources necessary to sustain such growth. Malthus did not see that the root cause of human misery rested with the unequal distribution of resources, but with the rapidly rising population and the poor multiplying at such rapid rates precluding their own ability for adequate means of survival. In short, it was not the economic structure and public policy that restricted human happiness, but population growth. A Christian clergyman, Malthus believed that there are limits to human happiness for infinity rests only with God. Therefore, it is not public policy that can deliver happiness, but rather people that must refrain from overpopulating the earth which has limited resources.

Without debating the many facets of Malthusian theory about asymmetry between rising population-declining natural resources, Malthus focused on this asymmetry as the one and only cause of poverty, disregarding the issue of equitable income/wealth distribution and the impact public policy on the economy. Classical economists from David Ricardo to Karl Marx debated the contradictions of capitalism, namely, how it creates enormous wealth and at the same poverty to polarize the social structure. Trade unionists, progressive politicians and journalists in the 19^th and 20^th century dealt with the same issue, debating whether public policy plays a role by legislating to promote the market economy based on the profit motive.

If indeed there was and still is more than enough food to feed the world’s entire population but it is simply not profitable for companies to do so, the Malthusian argument has its limitations. It is worth mentioning that contemporaries of Malthus, as well as neo-Malthusians and apologists of a capitalist system throughout our modern times, insist that poor people have no one to blame but themselves for their condition. Therefore, the state must remain a casual observer of structural poverty, although the political economy based on capital accumulation and socioeconomic inequality creates poverty as it facilitates capital accumulation. After all, every person is on their own and the state can only provide protection for life and property, according to classical Liberalism, not alleviate misery through social policy.

Adamantly against public policy alleviating structural causes of societal unhappiness, neo-Malthusians and neo-liberals believe that aiming at social justice and happiness of all sectors in society entails higher taxes on the more affluent taxpayers. In short, societal happiness rooted in social justice has a price tag for the wealthy. This was the argument in the 1930s amid the Great Depression when FDR tried to institutionalize the social safety net that was rooted in Progressive Era (1900-1920) and Keynesian thinking.

Published in 1930 on the eve of the Great Depression, Bertrand Russell’s Conquest to Happiness is a good study of some aspects of human nature with a rather practical and humane approach to the topic. Influenced by Aristotle’s view all things in moderation and the primacy of the individual as the measure of all things, Russell believed in the Western concept of individualism. However, he was not oblivious to the reality that external forces, including institutions like the state, obviously impeding happiness at the societal level.

It is rather interesting that the most prolific philosopher of the 20^th century decided to write a book would come out of the post-WWI decade when so many Europeans were not feeling so happy after the mass destruction and blamed not the individual but the institutions on which Western Civilization was built. Odd that Russell would tackle such a subject when a number of thinkers from T. S. Elliot to Jean-Paul Sartre were questioning the European value system that molded the minds of the masses and very foundations of Western Civilization as detrimental to human happiness.

Just a few years after Russell’s book on happiness, Hitler took power and authoritarianism with a pro-Nazi or pro-Fascist tilt spread from Portugal and Spain to Greece and the northern Balkans. All of this took place against the background of the Great Depression and just before the deadliest global war. How could the individual possibly remain oblivious to tyranny spreading across Europe, economic disaster conquering the world, and the reality that Hitler and Mussolini would spread destruction on a massive scale in Europe, Africa and the Middle East? How could any individual with a modicum of social conscience possibly remain oblivious to such developments and focus only on the self as though there is no society?  Even Russell the pacifist intellectual who realized that happiness goes beyond the narrow boundaries of philosophy as Plato and John Stuart Mill envisioned it, made an exception when it came to European democracies uniting to defeat the Axis Powers that were clearly a threat to humanity.

Classical Liberals and neoliberals of our time advocating globalization and privatization of any public service deplore the idea that the state must a role in the domain of human happiness. This is an interesting position, considering that public policy impacts the material lives of people, making the privileged in society more content while keeping the less privileged into a state of misery.  If happiness is the selfless act of doing beneficial things for others, regardless of whether the activity is voluntary or paid, then the laissez-faire proponents have no problem. But what if government policy from fiscal measures that are a means of wealth redistribution, to labor policy, to social policies are detrimental for the harmony of the citizen? Another dimension to consider about societal happiness and public policy is its absence in those countries that lacked national sovereignty which advanced countries simply assume is a given.

Happiness and public Policy in the Interwar Era

Is it possible for the state to conduct public policy in such a manner as to advance societal happiness or positive emotions of people even if this is a mere illusion on the part of the masses? According to Nicolo Machiavelli, people are invariably judging everything at the surface level, rather than its essence. Therefore, projecting an image in public policy intended to encourage greater positive emotions is all that matters.

The utilitarian theory of Jeremy Bentham as articulated in “A Fragment on Government” (1776), established the axiom: “it is the greatest happiness of the greatest number that is the measure of right and wrong.” Bentham’s axiom became one of the moral and legal bases for representative democracy. If the best society is where people are happiest, then Bentham was correct that it stands to reason the best policy is the one producing the greatest happiness. But is such a goal possible in a class-structured society, and is it possible in those countries that are externally dependent as are many in Africa, Asia, Latin America, and even the periphery countries of Southern and Eastern Europe?

Achieving happiness in the secular sense and linking it to societal institutions became a concern of the European intelligentsia representing the middle class in the 18^th century. Intellectuals of the Enlightenment influencing the 19^th century as well believed that a “scientific” method can be applied as much to solve social problems as all others. However, Enlightenment thinkers had different ideological positions that determined their views on human happiness and the role of institutions, including the state. Intellectuals reflecting on the concept of happiness were in essence reflecting the fundamental change in the social structure that the Industrial Revolution transformed and which in turn necessitated changes in the political arena, gradually bringing the capitalist class closer to imposing its will on public policy.

The interwar era brought to the consciousness of the masses around the world the government’s role in societal happiness (Jose Ortega y Gasset, Revolt of the Masses, 1930. This was especially so during the Great Depression that ruined the lives of millions, while mainstream politicians and apologists of the market economy asked people to simply wait until thing improve. The US and many other countries adopted New Deal type of policies based on the economic theory of John M. Keynes who advocated using the state to absorb the surplus capital from the private sector and combine it with deficit financing in order to stimulate jobs growth. Intended to rebuild decaying capitalism under the weakened parliamentary system in which the masses had lost confidence, Keynesian economics aimed to provide a safety net for the disgruntled masses. The state could not engender societal happiness amid the Great Depression, unless it alleviated misery on a wide scale.

In some countries, it was indeed too late to save the parliamentary system in which people lost faith. Fascism in Italy, Nazism in Germany and authoritarian regimes in southern and Eastern Europe resulted because the market economy was dysfunctional and generated misery on a broad social scale. The majority of the Germans during the Third Reich believed that Hitler and his regime were capable of delivering the utopian dream of a superior race. Masters at propaganda, the Nazis argued that if only the nation rid itself of Jewish profiteers and exploiters, Communist and gypsy parasites, other lesser humans impeding the racial superiority of Germans, only then would the pure Aryan race achieve its dream of societal happiness.

Although in reality the Nazis delivered destruction for Germany and Europe on a massive scale, their followers believed that was the correct path “racial and national happiness”.  Sixty-five percent of the German citizens who voted for Hitler and millions more around the world, entertained positive feelings for Nazism as the solution to societal problems. They felt good and happy about the Nazi regime, regardless of the illusory promises it was making to induce those positive feelings and regardless of the destruction it was delivering to its declared enemies. Nazism is one of the most glaring examples of mass illusions about societal happiness and public policy.

Coming to power at the same time as Hitler in January 1933, Franklin Roosevelt had to cultivate positive feelings on the part of the American people not demonizing “enemies” of the nation-state but asking for altruism, communitarian disposition and comforting people that their enemy was fear that they must overcome. In short, FDR approached the issue of mass psychology and inducing positive feelings across society by trying to convince the masses to rid themselves of illusions they entertained about the other as the enemy, about atomism as the solution, because the problem of the economic depression would be solved collectively and the enemy was the culture of greed and individualism of the 1920s.

A scholar who devoted her life to the study of totalitarianism in Germany, Hannah Arendt was influenced by classical Liberalism and the rationalism of the Enlightenment. Arendt argued that the first time we encounter the convergence of the concept of happiness with politics is during the French Revolution. While it is true that in their euphoria of the Revolutionaries raised the happiness theme to contrast the new regime with the old one under absolutist monarchy, it is a stretch to claim that the core of the French Revolution under the brief Jacobin rule rested on the concept of public happiness. Nevertheless, Arendt is correct to stress that never had a regime linked the concept of happiness with politics, considering that this was primarily the domain of religion.

Arendt’s work represents the sensitivity of a scholar who wrote about the horrors of the holocaust and at the same it reflects Western classical liberal assumptions that carry all of the bourgeois values of society and politics. Arguing that anything more progressive that trying to integrate the masses through a public policy safety net in order to engender greater equality constitutes a form of totalitarianism reflects both Arendt’s justifiable fear of Nazism and preference for classical European Liberalism as the only alternative. Coming out of the era of Hitler and Stalin, the era of the Cold War when totalitarianism meant both Nazism and Communism, she was very much a product of her era and found it unable to transcend it.

Contemporary Views on Public Policy and Happiness

There is growing evidence that rising levels of prosperity in Western economies after 1945 have not been matched by greater incidences of reported well-being and happiness. Indeed, material affluence is often accompanied by greater social and individual distress. A growing literature within the humanities and social sciences is increasingly dedicated charting not only the underlying trends in recorded levels of happiness, but to consider what factors, if any, contribute to positive and sustainable experiences of well-being and quality of life. Increasingly, such research is focusing on the importance of values and beliefs in human satisfaction or quality of life; but the specific contribution of religion to these trends is relatively under-examined.

Although money is not necessarily the thing that makes people happy, neither is abject poverty where there is lack of clean water, basic foodstuffs for survival and essential medical services. While the Western World and richer nations may not think about such things and demand better health care and education for their countries, we still have more than two billion people, mostly Africa, Latin America and Asia that lack the basic needs of life and that is a matter of public policy at the local, national and international levels as it touches the entire planet one way or the other. I want to stress that societal happiness in many parts of the Third World or developing nations depends on external forces that dominate national economy and influence public policy.

For merely propaganda reasons and to secure voter support, politicians are interested in finding ways that the voters believe they are “happy” with their candidate, even if they may disagree with parts of the candidate’s policy agenda. Emulating the behavior of the church, regimes from the Age of Absolutism to the present have tried to inculcate into the minds of the masses that happiness is synonymous with identification with the regime. Not just the cult of personality, but the cult of a regime has the ability to manipulate public opinion so that the majority believes their happiness hinges on strength of the leader and regime.

In a public opinion poll with the ranking of countries with the most negative emotions about their lives Iraq ranked at the top in 2013, followed by Iran, Egypt, Greece, and Syria, while African countries rank among the lowest in all such polls. In fact the top ten “least happy nations” have political regimes that are not tolerant of diversity as in the case of Middle East countries, or they face monetary austerity as in the case of Greece and Cyprus where half of the population is now below poverty or near it. OECD surveys dealing with the issue of “life satisfaction”, which is actually a better method of measuring responses than using the term “happy”, southern and eastern European countries under austerity policies (economic contraction) rank the lowest, while northwest Europe ranks highest.

While no one is surprised about the rankings of African and Middle Eastern countries, or India, Pakistan and Bangladesh, one may be surprised that the US has ranked just above or below Mexico in similar surveys. One would expect the world’s superpower to occupy a spot in the top five, but actually it is not even in the top twenty in many polls, indicative of the growing dissatisfaction with life under existing policies and institutional structures.  Although polls are manipulative and the issue of “happiness and life satisfaction” is very subjective, the empirical evidence based on opinion polls shows the correlation between human misery and public policy.

Without a doubt, the existing evidence shows that the Libertarian argument of non-government interference in individual happiness is not relevant because people do not live in isolation inside caves but in organized society under common laws and policies. If we assume that human beings that draft laws do so knowing that those laws will benefit some and not others, and if we assume the justice system is as political as the legal system, and if we assume that the wealthy and powerful receive preferential treatment from the judicial system, then we cannot expect that society is based on a sense of equality for all.

 

Realistically, people in the Western World especially, would oppose the idea of legislating happiness even if government promised it would improve their lives. Because they are immersed in atomism, they assume that their free will determines their state of being, not realizing the limits of free will and the enormous influence of public policy in everyone’s life. From very young age when children attend school that government provides, to very old age when they may enter a public nursing home for the elderly, public policy follows people in every aspect of their lives and determines the level of satisfaction of lack thereof.

 

When the state legislature votes down same-sex marriage, it impacts the lives of those interested in legalizing gay marriage. Interestingly enough, those in favor of legislating morality are adamantly against legislating happiness, unless it is in matters pertaining to their own interests. At the same time, the mainstream politicians, journalists, and most intellectuals would have no problem with the state legislating well-being through mass consumption of processed foods that make people ill, but they have a problem legislating to lift the structural obstacles of poverty that keep millions in misery.

 

While the concept of happiness in the Western world has been linked to public policy, that concept is not at the core of political movements and regimes in many non-Western World countries. While there is recognition that it is not the role of government to promote happiness through public policy, people understand when government can impede public happiness with its policies especially in fiscal and economic policy. Because there is greater attachment to traditions and customs, and because there tends to be a greater sense of collectivism than there is in the West, there tends to be a higher sense of satisfaction than in individualistic societies, at least according to a study by John F. Helliwell, Haifang Huang and Shun Wang who published their finding in the Journal of Happiness Studies.

 

With all emphasis on “efficiency” and competition, code words that apologists of market economics use to mean maximizing profit and cutting wage costs and taxes, the culture of “maximization” leads to greater unhappiness for the majority so that a minority may derive greater material benefits. The question is whether the “maximization principle”, as one scholar describes it leads to happiness as it promises or creates more problems and greater unhappiness in society. (Hilke Brockmann and Jan Delhey, eds. Human Happiness and the Pursuit of Maximization: Is More Always Better? (2013

 

Along the “maximization principle” that leaves the vast majority aspiring to what the minority has, there is a value system of atomism that goes along with it as part of the same ideology promising happiness. The privatized or atomistic notion of happiness in Western pluralistic societies is quantified against the framework of the “cash-value” culture and interpreted in terms of hedonistic value system. Immersed in atomism and hedonism, people subconsciously accept such assumptions but never aware of what makes them behave in a specific manner toward the pursuit of happiness as it is defined by the dominant culture. The notion of privatized self placed rather than the individual as an integral part of a community with a social conscience predisposed to consider the welfare of the community instead of the self raises serious ethical questions about the ethics of the concept of happiness in modern hedonistic society that the market economy and public policy reinforce.

 

Atomism keeps people in perpetual absence of happiness while altruism provides a sense of satisfaction, positive feelings and a deep connection between the individual and the community. Atomistic tendencies go hand in hand with the age of materialism in which the individual consumer is valued far above the citizen, the billionaire valued far above the humanitarian doctor working with the poor in sub-Sahara Africa, the famous movie star far above the soup kitchen volunteer. These values are constantly reinforced in everything from mass media to schools, popular books, and motions pictures that make up the dominant culture. These values are rooted in the political economy of consumerism that is a black hole leading nowhere, and certainly not to happiness because there is no end to the appetite for consumption that the public and private institutional structures push on citizens as the religion of our modern era.

 

Government leaders know as they have throughout modern history that forging consensus is the key to governing successfully. To deliver social justice through public policy that would in turn account for a happier population is a difficult task because this goal clashes with the interests of the various elites especially those who own most of the wealth, a problem that Solon faced more than 21 centuries ago when he took over Athens. One strategy of governments has been and remains that citizens must suspend happiness (their personal welfare) in the present in return for a better future for themselves and their children. This has been a standard strategy of Communist China, but also Western democracies as well as authoritarian regimes in the non-Western World.

 

As long as people see evidence of broader national progress they are willing to suspend a better life for the present in exchange for a better future – the prospect for upward mobility or the equivalent of achieving the American Dream. Because capitalism as an economy promises the “possibility of riches” for anyone who plays by the rules of the game, people suspending disbelief of their own reality and identify with the millionaire, aspiring to become him and vicariously living through him. Because people live with the dream of becoming instead of assessing their present condition and future prospects realistically, and because the state and institutional structure constantly plays the theme of hope in the media, the illusion of happiness in society becomes a reality. It is not the case that people do not know their own interests, but that they place faith in their aspirations. How can we blame a coal miner in West Virginia for dreaming of becoming a millionaire and trusting the media and politicians that someday soon he too can make it in a system that he knows is essentially very hierarchical and the odds are against him?

 

Another strategy the state adopts to keep people perpetually immersed in illusion is a Machiavellian solution, namely, appearance is reality in politics. The state delivers the message that the status quo is best suited for society and that any change would be detrimental, even if the majority of the people are not happy under the existing system. In this case, governments invoke everything from democracy and expression through the ballot box to patriotism, asking citizens to sacrifice for the greater good, and not to risk opposing the system that would entail threat to political stability.

 

This is to suggest that the cynical and propagandistic approach is the one that government adopts, instead of opting for the road to social justice that would deliver greater societal happiness. The only way to change an institutional structure rooted in inequality and unfairness is to take the advice of English philosopher John Locke, namely, if the system is tyrannical, then the people eventually overthrow it because they decide as subjects that it is not in their best interests. As long as people entertain the illusion of happiness, whether it is because of the mass media that propagates, through churches and schools, through businesses and social clubs, etc., the government does not have to be concerned about public policy that aims toward social justice and happiness of its citizens.

 

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Turkey’s Foreign Policy In The 21st Century

April 3rd, 2015

 

 

By  Jon Kofas.

 



 

Turkey’s Foreign Policy Contradictions

The end of the Cold War and the new US war on “Islamic terror” has influenced the foreign policy of Turkey, almost as much as the power vacuum created by the US military intervention in Iraq. Furthermore, Iran’s isolation by the West since 1979, the Arab Spring movements and their failure to produce democratic institutions during this decade, and Russia’s attempts to become a stronger Eurasian regional power have also played a role in shaping Turkey’s foreign policy along with the enormous growth of the economy currently among the G-20 group.

Within the Western alliance system where it belongs as a NATO member and candidate for EU membership, Turkey has tried to manipulate events to retain preeminent regional influence in the Eastern Mediterranean and among Islamic countries, but often without much success at all. Having presented itself as the “balancing regional power” between East and West, Turkey continues to project itself as such. Even former US National Security Advisor Zbigniew Brzezinski is convinced of its role as an intermediary regional force that the West needs.

The question is the degree to which Turkey is domestically stable, democratic and observing human rights, and to what degree is it a catalyst to regional stability or an agent of promoting regional chaos. In my view there are complex answers to the dynamics of Turkey’s foreign policy, and one cannot simply assume that Turkey is either the regional “balancing power” in the East-West power struggle for economic and geopolitical hegemony or that it is a force of instability. Even more important for the future of its people, there are questions about Turkey’s geopolitical role intended to serve broad popular interests or does it only serve the narrow ones of multinational corporations and the politically-entrenched domestic elites surrounding the utterly corrupt Erdogan regime based on a clientist system.

The Islamic-oriented Justice and Development Party that has ruled since 2003 have tried to change both domestic policies and foreign policy, reverting to the Ottoman Empire as a model. Is it possible for a 16th century feudal model to have any relevance or a realistic chance of applicability in the 21st century as the Justice and Development Party assume? Can the ruling party rule as though there is a homogeneous popular base behind it when the country is diverse with a rapidly developing Westernized middle class, a large Kurdish minority and a substantial segment of poor devout followers of Islam? Reflecting Western and Middle Eastern influences, Turkish identity ranges from secular and Islamic nationalism, to secular and Islamic liberal and leftist ideological trends concentrated mainly in along the urban areas, especially Istanbul and the western coast.

The clash of the disparate ideological forces, a clash that has been around since the 1920s during secular Western reformist Mustafa Kemal Ataturk, combined with entrenched interests in the military, police, and bureaucracy, as well as state-linked business interests often connected to the military, account for some of the incoherent and contradictory aspects of Turkish foreign policy. Of course, the billionaire/spiritual leader Fethullah Gulen and his movement constitute a major force, although he collaborates with other domestic and foreign interests against the Erdogan regime. As we will see below, the power struggle between disparate interest groups trying to exert domestic and foreign policy influence to benefit politically and economically from public contracts at home and abroad play a major role in pulling Turkey’s policy in different directions.

Many analysts argue that the cult of personality that current president and former premier Recep Tayyip Erdogan has been cultivating among Muslims throughout the Middle East and in the Turkish provinces as a way of breaking the long-standing Kemalist institutional dominance has been the driving force behind Turkey’s foreign policy. Revelations about his opulent lifestyle and web of corruption are out in the open and it is difficult for Erdogan to conceal his greed and hunger for power at just about any cost. Equally difficult for the regime, Ankara cannot pretend to embrace the cause of the Palestinians and Muslim masses, considering Turkish covert support for Jihadist rebels in Syria and Iraq while at the same time collaborating with the US to undermine certain Arab regimes as was the case in Libya and Syria.

Clearly, structural forces within the country, regionally and globally, especially with China playing a major role in Asian developments have determined the direction of Turkish foreign policy that may often seem directionless if not risky or even reckless. Although the Justice and Development Party tried to revive the glory of the Ottoman Empire, as Erdogan, and Ahmet Davutolgu, former foreign minister and current prime minister, see it, in 2014 the dreams of Ottoman glory have proved the illusions of the early Erdogan administration fading fast amid Turkey’s regional isolation and incoherent foreign policy.

As far as the Erdogan-Davutoglu Justice and Development Party regime is concerned, Turkish foreign policy is cohesive and the goal remains to revive the glory of Turkey as it once was under Suleiman the Magnificent. After all, despite periodic mass protests confined to Istanbul and major cities, despite outcries about human rights violations and the occasional trouble with the Kurdish minority now involved in a struggle against the ISIS Jihadists, Turkey is more stable and more democratic than the rest of the Middle East that suffers from internal turmoil, absence of electoral system Turkey enjoys, and almost perpetual foreign interference in its internal affairs. Nevertheless, glaring foreign policy contradictions reveal a very troubled and isolated Turkey that has gone as far as to try rebuilding its strained relationship with beleaguered Putin’s Russia caught in a renewed Cold War that the US-EU allies launched in 2014.

The Persistent Illusion of Restoring Ottoman Glory

All political leaders with boundless ambition and a taste of ephemeral power have experienced the trap of grandeur. A man who came from a poor background and rose to riches and power through the political process, Erdogan is hardly an exception and in this respect he has a lot in common with Vladimir Putin. Turkey under Erdogan went from trying to achieve the dream of restoring the greatness once enjoyed under the Sultans in the 16th century (Suleiman I the Magnificent) to the nightmare of regional and international isolation. This has been a consequence not only of illusions turned into nightmares but of a series of policies in the last four years related both to domestic developments, a rapidly changing regional balance of power, and renewed diplomatic and economic confrontation between the West and Russia.

On 14 November 2014, Hurriyet Daily News (English language edition), published an article about the shifting trend in Turkish foreign policy. According to a new study by a Finnish research group, Ankara’s shift from the West to a Eurasian-Middle Eastern orientation has EU and US leaders confused about where Turkey is headed, East West, both, neither, and exactly what is it trying to achieve. Although some argue that Turkey has changed directions because it is merely responding to changing conditions in the Middle East and Asia more broadly, I believe that Turkey has learned hard lessons during the early Cold War about not putting all of its eggs in one basket when it comes under fire from its own allies, and instead carving out a more multidimensional foreign policy until its allies realize how much they need Turkey.

This does not explain its recent contradictory foreign policy that has many analysts wondering what Ankara is trying to achieve. Nevertheless, the contradictory and multidimensional nature of its foreign policy has the West reexamining how far it can push Ankara into conformity. This is especially after a recent meeting between Erdogan and Putin. As Pope Francis was completing his trip to Istanbul at the end of November 2014, Putin was arriving with an entourage of officials to ameliorate relations with Turkey in the commercial front and to discuss regional security issues that range from Syria to Ukraine. It was a highly symbolic move for a NATO member to be pledging neutrality in the new US-EU vs. Russia confrontation. Nevertheless, Turkey had no choice amid an increasingly isolated role in which it finds itself vs. the enormous economic benefits of closer economic ties with Russia. Even if Russia is leverage for Ankara’s negotiations with the EU and US, then the move proved very clever and logical.

Besides abandoning the South Stream gas pipeline that would provide energy for Europe, Putin focused on creating new trade links with Turkey that includes energy once intended for Europe. Primarily for geopolitical reasons, both Turkey and Russia have been experiencing strained relations with the EU and US, but for different reasons. To offset its relative isolation from the West, Turkey as Russia’s second biggest trading partner agreed to raise trade volume to $100 billion by 2020 or triple from the current figure. Perhaps this was all hype, but symbolically it sent the message to the West that Erdogan and Putin wanted. Besides having major benefits from Russian tourism and benefiting from the Russian boycott of EU products, Turkey also benefits from discounted gas prices Moscow provides through the Blue Stream pipeline until such time as Turkey relies more on nuclear energy, a project with which Russia will help by building the first nuclear power plant at an estimated $20 billion cost.

Mired in numerous contradictions that cannot be justified on the basis of a multidimensional foreign policy, Turkey is indeed in search of a coherent path that would further its interests as currently defined by the Erdogan-Davutoglu regime. While I would not characterize Turkish foreign policy directionless, neither would I go as far as arguing that it has a coherent core. This is not something that just surfaced because Turkey was recently overlooked by the UN for a rotating UN Security Council rotating membership. Despite US support, or in reality partly because of it, Turkey did not have the votes, while Venezuela did. This demonstrated that most countries could not place confidence in a country with shifting positions, playing all sides while remaining a NATO member.

The contradictions so evident in foreign policy stem from the rapidly changing balance of power in the Middle East because of US covert and overt military operations, but also from the inexorable link of Turkish foreign policy and domestic affairs, especially under President Erdogan who had ambitions of emulating the style of 16th century Sultans, but has proved nothing more than a corrupt petty tyrant trying to justify his quasi-authoritarian regime by invoking Islam at home and abroad. This does not mean that the Justice and Development Party do not have a solid political power base that includes loyal people in the bureaucracy and military that support Erdogan-Davutogl policies. At the same time, as elections have proved, the ruling party enjoys a popular base, despite the enormous socioeconomic inequality.

According to Credit Suisse’s Global Wealth Report 2014, Turkey has one of the world’s highest levels of income inequality, ranking 3rd among the 34 Organization for Economic Cooperation and Development (OECD) 34 countries. The Justice and Development Party has been using foreign policy as a diversion, considering that income inequality has been rising in the last fifteen years. Indicative of a deliberate policy not to address the income inequality issue and instead focus on dreams of reviving Ottoman glory, the Erdogan regime has been very generous with the top income groups and companies operating in Turkey, while deriving more than three-fourths of all revenue from indirect taxes that fall inordinately on consumers. Given that the Erdogan popular base is made up largely of rural and poor people loyal to Islam, he has continued to propagate about his commitment to Islam and foreign policy intended to make Turkey the most powerful regional player.

Edrogan: Would-be Sultan or just another corrupt politician?

Unique in the Middle East, Turkey is a secular society ever since Mustafa Kemal Ataturk carried out major institutional reforms in the 1920s and 1930s. However, despite the deep Westernized Kemalist roots across society, Islam is powerful in the provinces as we have seen in the last two decades. This essentially reflects a struggle between the modern bourgeois modernization forces in the western parts of the country against the Islamist eastern parts where identity rests with faith rather than secular institutions carrying Kemal’s signature. Partly because of this divide in Turkey that aspires to become a full EU member, the Erdogan-Davotuglu regime has been playing the “mediator” role; and I underscore the term “playing”, because it clearly has lost all credibility with its foreign policy games among its neighbors as well as European and Americans.

Desperate to fill the power gap left by Iraq and Syria, Sunni-dominated Turkey does not want Shiite Iran to be the dominant Islamic regional power. In this respect, Turkey has a lot in common with Saudi Arabia and the Gulf States, but even with the arch-enemy Israel that also wants a weakened Iran. Many Western analysts see this kind of foreign policy as realistic, while others view it opportunistic, populist, directionless, or incoherent, although they see no problem with Washington pursuing equally contradictory policies toward the entire Middle East.

President Erdogan and Prime Minister Davutoglu blame the global Gulen movement for the propaganda unleashed against the regime’s domestic and foreign policies. Billionaire living in the US, Sheikh Fethullah Gülen is an imam with far reaching connections among Muslim and non-Muslim religious leaders globally. He considers himself a prophet and his followers are throughout the Turkish police force, military, and other bureaucracies. Because of the immense economic influence of conglomerates under Gulen’s influence and tacit support by the US and Israel, the Erdogan regime feels that it is fighting an enemy from within but with enormous tentacles in the West and the Middle East. This is one reason that Turkey has found itself isolated as far as Erdogan and the Justice and Development Party elites are concerned.

Besides enjoying the support of the Islamic faithful especially in rural areas away from the more Westernized and bourgeois coastal regions, the Erdogan regime has created new elites in the provinces as part of his political and popular power base. This means that Erdogan has broken through the influence of the military hierarchy that enjoyed many privileges from business opportunities and export businesses to securing choice positions under a patronage-nepotism network.

Before Erdogan as well as during his regime, the political class helped to create the economic elites by offering government contracts and various commercial licenses for domestic and international trade. This may indeed sound like a neo-mercantilist system, but it is rooted in 20th century clientist politics in many developing nations throughout the Middle East. Ironically, the Muslim faithful that make up Erdogan’s popular and political base are convinced that he is anti-elitist and that secular Kemalist elites oppose him along with followers of the Gulen Movement and some wealthy Sunnis.

The elites emerging under the Islamic-oriented populist Erdogan regime want a stronger central government that is closer to what existed under the Ottoman Empire than what Kemal tried to create by distancing the nation’s institutions from those linked to Islam. This means that the new conservative elites are skeptical about the West, they prefer a more authoritarian Turkey, or at least a strong executive and weak legislative branch and they want to explore their future prospects with Eurasia because they see that is where global power would be concentrated in the 21st century.

This does not mean that Turkey is anxious to leave NATO or to put EU membership aspirations on the backburner, but it does mean utilizing its foreign policy and foreign trade options as leverage to secure its goal of hegemonic regional power. The problem here is how do the US and EU perceive Turkey’s ambitions colliding with their own regional interests, and to what degree are they willing to contain Turkey by playing the Greece-Cyprus, Israel-Egypt card as a counterweight?

Fading Dreams of Reviving Ottoman Glory

If we take the long view on Anatolia’s intermediary role between East and West it is not surprising that there has been much written on the contemporary history and future prospects of Turkey. Some analysts and politicians believe Turkey could become the economic Brazil the Near East later in the 21st century. I would not disagree that Turkey has such prospects, if it were not for its recklessly ambitious foreign policy that has clearly overreached, its chronic problem with the Kurdish minority, its refusal to address basic human rights and democracy-oriented issues put before it by the EU, and above all to lessen the level of corruption that has reached unprecedented levels under Erdogan, modern Turkey’s would be Sultan who lives like a Medieval ruler in a palace of 1000 rooms and has stashed away billions in bribes.

Turkey’s prospects could be realized if it were to address the issues I noted above, largely because the country marked enormous economic progress during the Erdogan regime. After serving as prime minister from 2003 until summer 2014, Erdogan became president and Davutoglu became prime minister. Despite massive public and private sector corruption, it is difficult to argue with the phenomenal rate of GDP growth under Erdogan. Even in 2013 when EU was experiencing about zero GDP growth rate, Turkey enjoyed a 4% increase. Construction demand, tourism, as well as manufacturing fueled economic growth in the last fifteen years, allowing Turkey to pour money into its military and luxuriate in dreams of reviving Ottoman glory.

The phenomenal economic development of Turkey in the first decade of the 21st century appeared as nothing short of a miracle, leading a few to conclude that Turkey is indeed headed for prominence. Domestic and foreign businesses enjoy relatively low tax rates and cheap labor along with a growing domestic market where consumer demand is partly responsible for driving growth. This does not mean that the gap between very rich and poor is closing. On the contrary, 17% of the population lives below poverty, a number that is comparable to many countries in Latin America, but still half that of neighboring Greece enjoying full membership of the EU.

Currently ranking 17th in the world GDP terms, Turkey is a developing economy headed rapidly toward full scale development with its manufacturing sector becoming more significant along with its primary sector of production. Despite uneven geographic development with the western parts experiencing much greater development to the neglect of the eastern, the competitive advantage Turkey has offered for multinational corporations has meant massive capital inflows, given that it is conveniently located between Asia, Africa and Europe, making transport costs attractive. Economic diversification that resembles that of Brazil combined with its pending status as a full EU member make Turkey a candidate for a future much brighter than most of existing EU members in the southern and eastern parts of Europe.

The Justice and Development Party came to power with the prospect of developing the economy and changing the corrupt political system, while at the same time making Turkey into the greatest regional power in the Middle East. In fact, Turkey would try to revive the glory of the Ottoman Empire under Erdogan’s AKP Islamist party, largely by embracing the cause of the Palestinians as well as the Islamists throughout the Middle East, including the Egyptian Brotherhood.

The Erdogan regime is interested in having Turkey play an essential diplomatic role between West (NATO, especially US) and Middle East. It is no secret that Turkey wants to recapture some of its Ottoman glory through diplomacy; it wants a greater geopolitical role that would give it leverage to have a voice in determining the regional balance of power. This makes sense because there is no longer a Communist bloc, the US failed in Iraq and Afghanistan, both EU and US appear helpless in bringing about a solution to the Israel-Palestine conflict, and it seems that such a course would solidify Erdogan’s domestic political base threatened by secularists inside the military as well as outside. The question of where the regime is headed in the rest of the decade with a rising tide of Jihadists remains a source of concern for Turkey’s Western partners as well as its neighbors.

That it has an open and fairly cordial dialogue with Greece, while it is fairly isolated from most of its neighbors is an astonishing accomplishment because Greece has recently allied with Egypt and Israel over the Cypriot energy resources against Turkey. Another blow to Turkey’s foreign isolation came on 13 November 2014 not because the EU threatened sanctions if it violated Cypriot sovereignty over at sea, but because on the same day the EU voted as EU Military Committee president the chief of the Hellenic Armed Forces.

Unofficial reports claim that Berlin was behind this move, partly to send Ankara a message, but also to support the conservative regime in Athens. Given that the climate in the EU has turned even more against the government in Turkey than it had been in the last three years, Ankara has no choice but to look East to counterbalance the West. This issue surfaced immediately during the G-20 meeting in Australia on 15 November 2014. Davutoglu argued for discussing political and geopolitical matters that impact the world economy and making the group of the 20 richest nations more inclusive of the rest. In short, Turkey identifies itself with non-G-20 and sees that most in the richest countries are not favorably inclined toward Ankara at this juncture. This sense of isolation of a country aspiring to become an important regional power reflects the hasty foreign policy moves that Ankara has been making, with each step further alienating yet another country instead of reaching closer to its goal of Ottoman glory.

Turkey and the Jihadist ISIL

The story of Turkey’s relationship with jihadist Islamic State (ISIL) is one that may never come to light because there have been secret dealings kept out of official channels. We do know that Turkey played all sides on the Jihadist ISIL matter, but in the end fooling no one from the Kurds it betrayed to its NATO allies that were also double-dealing because they wanted Asad’s Syria undermined by Jihadists but did not want the creation of a new anti-Western Islamic state like ISIL.

Saudi Arabia and Qatar were sending money to Turkey to fund the anti-Assad rebels in the last three years or so, all with the approval if not encouragement of the US. Turkey was using part of the money to fund the rebels, and some of the funds to finance Jihadists in Russia, despite its official position that of not meddling in minorities issues in Russia. The diversion of funds was a matter kept secret from the donors, although the Erdogan regime was confident that those sending money for jihadists against Assad would have no problem supporting Muslims against Putin who has been Syria’s biggest supporter along with Iran.

Turkey has suddenly lost its backing from Arabs – including Saudis and Qatar – as well as much of the international community largely because ISIL has become a monumental problem at the regional and international levels. Given that Iraq ranks among the top five most corrupt countries in the world, and considering it is a society in shambles after the US military invasion, ISIL has not had much difficulty securing support, despite its barbaric methods of dealing with opponents. Because of questions about Turkey’s position when it comes to ISIL, the government decides to cause some disturbances in Cyprus by resorting to a demonstration of naval force present. Insisting that the under-sea energy resources currently under exploration must be divided with the Republic of Northern Cyprus, Ankara found no support among any country in the world for its tactics, least of all the EU members.

The public international opposition to the manner that Turkey was handling both the ISIL matter and the energy one over Cyprus caused the Erdogan-Davotuglu regime to reexamine its options with Russia, especially after Iran joined the anti-Ankara chorus. Although Turkey had relatively harmonious relationship with Iran, this too has ended over Iranian support for Assad and Turkey’s backing of rebels against the Syrian regime. Iran is now openly blaming Turkey for strengthening the ISIS jihadists and US-led coalition against Assad that led to the war conditions in neighboring Iraq. Relations between Ankara and Tehran became even more strained when Prime Minister Davutoglu rejected the notion of respecting territorial sovereignty of Syria and Iraq, thus implying that Turkey’s priority is not the defeat of ISIS as is the case for Iran, but Assad’s downfall.

If Assad falls, this would mean Hezbollah is weakened, something that Israel also wants, but Iran regards as a worst case scenario for its influence in Lebanon and Syria. Iran now regards Turkey as the most destabilizing force in the Middle East because of its goal to use the chaos and weakening of all its neighbors so it can realize its dream of reviving the glory of the Ottoman Empire.

Considering the intervention of the history of military’s intervention in the political arena when the political parties reach an impasse on key issues about the economy, Erdogan has managed to maintain civilian rule while keeping the limitary under tight control. This is partly because of a strategy of co-optation, partly because of threats and intimidation, and partly because he has tried to keep the armed forces engaged always under his control and serving his foreign policy goals.

Throughout the Cold War, Turkey was a NATO member representing stability in the Middle East, especially after the Iranian Revolution that entailed US losing a loyal ally in the region. While it is true that Turkish foreign policy has been more multidimensional than that of other Middle East countries, especially in the last four decades, the country remains a NATO member and aspires to EU membership at some point. However, Ankara under the Erdogan-Davotulgu regime is hedging its bets by diversifying its diplomatic and economic policy, rather than placing all of its faith in Western integration. One reason is that Israel has been an obstacle to Turkey’s ambitions, as it openly challenges Ankara’s role in the Middle East and working with Cyprus and Greece openly, while also cooperating with Jordan and indirectly with Egypt on significant energy and geopolitical issues, including the endless Palestinian issue.

Turkey’s isolation in the entire Middle East is partly its own creation, as it has tried to play all sides. For example, German sources indicate that Turkey was collaborating with ISIS jihadists, understandably of course, given that there is the endless Kurdish problem Ankara has been confronting. At the same time, Turkey had no choice but to show the world that it opposed the jihadists against whom NATO has declared war in Syria and Iraq. Fearful that nationalism is Islamic countries is gradually withering away because of religious loyalties among the masses, and overwhelmed by enormous middle class popular opposition in addition to that of religious leader/billionaire Gulen, Ankara under Erdogan has been caught in a web of incoherent policies that are bound to backfire.

It is true that before Arab Spring the Erdogan regime seemed on its way to making history in the domains of a vibrant economy as well as foreign affairs. It all began to fall apart largely because Erdogan and Davutoglu actually turned out to be a gang of corrupt politicians that have been engaged in numerous money/business scandals, while at the same time pursuing a foreign policy that alienates just about everyone, even those trying very hard to keep their ties with Ankara. Turkey made a mess of its anti-Assad campaign, secretly helping the jihadists, then making back door deals with them , then making deals with the US to fight them, while at the same time trying to weaken the Kurds that were fighting against the ISIL jihadists.

Conclusions

The end of the Cold War and the beginning of the US-led war on terror, and China’s rise as the global economic superpower forced many countries around the world to adjust their foreign policy. As a NATO member and waiting for EU membership, Turkey has been in an especially difficult position because it is a Middle East country that the West has not always viewed favorably. Many Turks legitimaly complain about the prejudice they face by EU that has been dragging its feet on the issue of Turkey’s EU membership. At the same time, Turkey has had to co-exist with a much more powerful Iran after the US invasion basically obliterated Iraq now under a very real and scary ISIL threat.

Turkish foreign policy in the early 21st century is a reflection of the turmoil in the Middle East caused in large measure by US-NATO intervention on a sustained basis in order to achieve regime change and determine the regional balance of power as well as benefit by securing markets. However, the domestic clashes of disparate interest groups behind Erdogan’s Justice and Development Party on the one hand, and the secularists representing different ideological positions combined with the Gulen Movement are some of the dynamics at work. Reaching out to Russia to counterpoise the West represents the desperation of a government that struggles with domestic policy contradictions.

If Turkey under Erdogan in the last twelve years had created a more evenly distributed income across all social segments, there would be no need to manipulate the issue of Islam at home and abroad any more than pursuing a foreign policy immersed in contradictions. Trying to replace the Kemalist institutional structure with a corrupt clientist network that would secure the preeminence of the Justice and Development Party has force Erdogan into foreign policy schemes that have backfired and may ultimately bring down his regime by a combination of domestic upheaval, and/or military intervention in the political arena with the support of the US and other governments that see no benefit supporting the current regime.

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Cultural hegemony and social chance: 2015

March 28th, 2015

 

 

By Jon Kofas.

 


Introduction: Cultural Hegemony in Marxian and anti-Marxian Thought

We live in the most difficult times since the Great Depression, despite the end of the recession that started in 2008 and ended in 2011 in the US, while it lingers in much of the world until 2015. Just as in the Great Depression when there was political polarization and weakening of bourgeois parliamentary democracy but no revolution except for rise of Fascist movements, similarly in the early 21st century there is no sign of social uprisings in the Western World undergoing a crisis in the political economy and bourgeois institutions. Why is it that the masses remain so incredibly docile, a segment gravitating to the extreme right as we see in France, Greece, Austria, and across much of Europe where the leftist parties have yielded to neo-liberalism while retaining the Socialist rhetoric?

Another segment of the population going as far as street protests and then back home to their social media networks hoping others will join them or at least provide moral support for social justice.  By far, too people remain apathetic, beaten down by the institutional structure that shows signs of rising GDP but income redistribution from the workers and middle class to the top ten percent of the richest people. In  2015 America’s real estate market shows a rise 13 times higher than wages, forcing workers and the middle class either to go deep in debt or rent, in either case working to pay the bank.

The euphoria about the BRICS, (Brazil, Russia, India, China and South Africa) is fizzling, with the exception of China that has much better prospects having consolidated its position in the international economy than on the rest that either depends on revenues from energy and minerals, or foreign capital that tends to shift with opportunities. Under IMF advice, all countries are trying to reduce public debt, a move that has sent many toward austerity measures that reduce consumption power for workers and the middle class and transfer capital to banks.

The miracles in most of the BRICS, especially in Brazil and Russia each with its unique set of political and economic problems, will have to wait much longer than enthusiastic analysts had been predicting in the last ten years. While GDP growth rates have been phenomenal even in these countries, the vast majority has not seen any of the benefits. Yet, people are not protesting, they are not as vociferous as one would expect about the fruits of capitalism filtering down to them, about democracy remaining a restricted luxury for the broader masses of the population because the privileged capitalist class protected by the political class refuse to fulfill the social contract as people understand it.

If the political economy does not determine human behavior, is cultural hegemony responsible for shaping the human mind? In ‘sociological Marxism’, a theory that assumes society runs parallel to economy and state and rejects economic determinism, Marxian intellectual Antonio Gramsci, Karl Polanyi and others were among early 20th century thinkers who developed a theory of cultural domination. Arguing that ideological superstructures (institutions secular and religious, public and private) dominate to influence the human mind that they did not see as mechanistic, these thinkers placed the class structure in the context of cultural hegemony that is the product of bourgeois constructs rather than an inevitable or natural consequence as mainstream thinkers argue.

Another dimension to understanding cultural hegemony and the evolution of political systems is through the work of Barrington Moore’s Social Origins of Dictatorship and Democracy (1966). Moore examines how social structures under an agrarian and industrial political economy produces certain political outcomes in different parts of the world, focusing on the violence preceding the evolution of ‘democratic’ (bourgeois) institutions. A sociopolitical revolutionary break with the past comes only after there has been an economic transformation that alters social relations. Moore made famous the statement “no bourgeoisie, no democracy”, which of course explains the 19th and 20th centuries, but it leaves questions about the decline of the bourgeoisie in the early 21st century and what that entails for democracy.

While Gramsci, Polanyi and Moore analyzed the dynamics of social class, political economy, social discontinuity, and the role of cultural hegemony from a rationalist or scientific perspective, Richard Rorty, an American philosopher who represented the new generation of right-wingers from the Reagan to the Bush presidencies returned to the assumptions of Thomas Hobbes and Edmund Burke regarding the irrationality of human nature and the conspiratorial nature of demagogue intellectuals preaching revolution in order to improve society and human beings; an otherwise unachievable goal. Besides perpetuating cultural hegemony instead of trying to understand it and suggesting ways for a more socially just society, such a philosophy is intended to reject a rationalist or scientific method of analyzing social class and political economy. The propagandist and populist nature of  Rorty’s philosophy captured the imagination of other populist conservatives throughout the media and political world.

Conservatism, especially in its extreme and especially when it comes from what the mainstream baptizes respectable academic, sells and it sells big with a segment of the population that is suspicious of intellectuals, identifying as ‘elitist’ that have no connection to the ‘common man’. Because conservatism, especially in its populist form, has been an integral part of cultural hegemony that resonates with a receptive audience already indoctrinated in the cultural mainstream. When someone like Rorty or populist talk-show personalities argue that the new Left intelligentsia has been obsessed with castigating the US for having an institution of slavery, a history of racism toward minorities, a militaristic policy that proved unpopular with the War in Vietnam, etc., a large segment with strong nationalist tendencies identifies with such rhetoric and becomes anti-revolutionary. This is the ultimate triumph of cultural hegemony when the masses at whose expense policies are implemented adopt an ideological position contrary to their own interests.

Belaboring the negative institutional traits of society to radically change society is an anathema to Rorty and those promoting cultural hegemony, while true salvation is to be found in working within the system, accepting cultural hegemony that entails institutional conformity. Just like the early Cold War when there was systematic persecution of dissidents from Hollywood to academia and research laboratories, including that of Robert Oppenheimer (Manhattan Project), similarly in the early 21st century there is a major shift toward that political climate of quasi-police state, helped along by cultural hegemony.

It remains amazing to me that so few not only in the mainstream media but even in the broader web media have shown little interest in immigrant detention centers in Texas and Arizona, in the illegal detention center mostly for minorities held without due process in Chicago’s Homan Square whose torturers have links with Guantanamo detention center. The US Constitution flagrantly ignored, civil rights abused, as well as human rights, but there is very little one reads about all of this as though it does not exist. Is society so indoctrinated in the dominant culture that the mainstream media has taught it to selectively choose what constitutes news – anything related to crime, foreign enemies, especially “Islamic terrorists”, business, celebrities, and human interest stories – while everything else from the quasi-police state to rising gap between the very rich and the rest is irrelevant?

Bourgeois Values and Indoctrination of the Masses

Does the dominant, or hegemonic social class and the political elites representing that class in pluralistic societies under the guise of ‘democracy’ have the ability to perpetuate the facade of ‘democracy’ behind which operates an economic dictatorship, an increasingly anti-labor and quasi-police  state whose role is to prevent social change? If so, why has the institutional structure from politicians to the media, from churches to schools been so successful convincing people this is “normal” and we must continue to call it “democracy”? As long as cultural hegemony is effective in shaping the concept of self (Louis Althusser) for the masses, and as long as the masses identify their interests with the dominant social and political class, the facade of democracy and bourgeois culture works to prevent social revolution, even reform that has the potential of leading toward greater social justice.

Cultural hegemony explains modern-day reluctance on the part of workers and the declining lower middle class to resist through revolutionary means. However, one must never underestimate the power of co-optation, considering that the institutional structure has the vast means at its disposal to co-opt everything from “rebel” music to rebel movements. Is it possible that a social revolution is not taking place in the Western World and especially across southern and much of eastern Europe where austerity is devastating the middle class and workers because people have accepted bourgeois values, ideology and institutions to which they see no alternative better than the existing one no matter how horrible it may be? It is also the case that the comprador bourgeoisie – the capitalists dependent on foreign capital and foreign businesses – have convinced a large segment of the population that there is no choice but to maintain the “dependency status quo”.

What are some of the values imbedded into the minds of the masses, including reformists and even leftists, at least those claiming the title?

1. Working within the parliamentary system to find solutions to societal problems, because working outside such a framework entails absence of legitimacy as bourgeois society defines it, and the risk of lapsing into chaos if revolution follows means personal and societal disaster.

2. Ardent belief in individualism as the norm and the categorical rejection of communitarian values as deviation from the norm. In practice, this means that if you are rich, it is owing to the merits of your character, not because you have found the key legally or illegally to engage in the process of capitalist appropriation. By contrast, if you are poor, it is your fault, not institutional, because you must lack some trait that prevents you from making it in the open society that offers institutional opportunities to all who become rich. Therefore, the institutional structure is ‘objective’ and thus blameless for the fate of the individual and the multitudes of poor.

3. If the economy is contracting, it is because you and those like you have been living too well in the past, while under-producing, so now you must pay – this is especially true if you are a public employee, generally assumed lazy and overpaid, if not corrupt assuming you have a position that lends itself to making money under the table. In short, upward social mobility experienced in the past must be moderated through the process of downward social mobility for society to find balance, so the workers and middle class must sacrifice for the whole of society, when in reality the sacrifices are intended to strengthen finance capital.

4. If the economy and the state fiscal structure is on the wrong course, it is your fault for immersing in consumerist greed, debt-spending, or not spending enough to stimulate the consumer-based economy, and not paying your fair share of taxes that accounts for your predicament and that of the rest of society. How do all of these contradictory things make sense is in itself fascinating and that people believe it even more so.

The answer rests  with cultural hegemony. Specifically, it has to do with massive advertising as well as the media whose role is to inculcate bourgeois values along with bourgeois guilt into people’s heads. The rest of the institutions, from churches to schools, play a contributing role in the process of shaping the mind and identity, thus the entire society is bathing in the worldview of the bourgeois economic and political elites that transfer blame downward toward the masses, arguing that in an open society people have freely chosen their leaders and institutions, when in reality those have been superimposed.

5. When the economy is on the wrong tract, politicians are to blame and almost rarely business that the political class serves. For example, US public opinion poll conducted in 2011 found that 66% blame the lack of economic and job growth on ‘bad policy’, while only 23% blame Wall Street, despite the well-publicized ‘Occupy Wall Street’ movement that eventually fizzled out as far as failing to take root at the grassroots and spread deeper into society to create the genesis of a popular movement. While there is a small segment that realizes the need for systemic change, grassroots organizing, solidarity with similar groups around the world, the majority either passively accepts or even trusts the corporate structure because they identify it with the ‘national interest’, while they mistrust politicians who in essence are the servants of the corporate structure. This process is also part of cultural hegemony.

6. Cultural hegemony is triumphant because the irrational is triumphant in human nature. It is a myth, perhaps dating back to Lockean philosophy and its influence on Enlightenment thinkers that influenced 19th century socialists including Marx, that human beings are rational and act as such, implying that in cases of social revolution the motivation and intent of those following revolutionary leaders is rooted on idealism.

As much as I regard reprehensible the philosophy of Thomas Hobbes who opposed the English Civil War of the 1640s and the counter-revolutionary Edmund Burke who opposed the French Revolution, there is something to be said about their keen observations regarding human nature manifesting itself in revolutionary times. Is it not the case that the rupture in cultural hegemony took place during the course of the Enlightenment that challenged the status quo, thus providing a sense of legitimacy to the revolution? After Locke was the first philosopher to make a rational case for revolution and he was a major influence on the French in 1789. In short, cultural hegemony has limitations because it is always challenged, and when that challenge reaches a substantial number of people and the nature of the challenge converges with the realities in peoples’ lives, a segment of them will challenge the status quo.

Cultural Hegemony Lessons for the 21st Century

Revolutionary action has always been confined to a small group that leads and organizes grassroots support for mass uprisings against incredible obstacles by the state and the entire institutional structure. What motivates some to protest, others to adopt a more militant position, and the majority to do nothing except complain to their family and friends or write on social networks in the hope others are listening, a form of social psychotherapy? Has cultural hegemony suppressed any sense of idealism of aiming toward social justice because of the successful co-optation strategy that the mainstream institutions employ? After all, as Palmiro Togliatti (Italian Communist party general-secretary in the 1920s) insisted in his Lectures on Fascism, people must tend to their immediate needs of survival and set aside ideology. Is the majority of the population immersed in ‘bourgeois pragmatism’ – paying bills for now, taking care of family, satisfying immediate needs and trying to advance their careers in the age of careerism that cultural hegemony promotes?

Is the majority so overwhelmingly dispirited because politicians promise “reform” to deliver a variation of the status quo and keep it as is? This is the case in the French election of Socialist President Francois Hollande who vowed to take on German monetarist policy that was hurting the middle class and workers, but instead moved as close to Merkel’s austerity and0 neoliberal agenda as his conservative predecessor. Even worse case was the election of Greek SYRIZA party chief Alexis Tsipras who dogmatically insisted on ending austerity, privatizations, layoffs of public workers, reinstituting the social safety net, higher wages, and above all establishing national sovereignty in a nation that is in essence a colony of northwest European and Chinese capital with US military bases. Scenarios of politicians blatantly lying to voters about change and change never materializing are universal. What is the beaten-down worker to do, especially when presumably leftist political parties fall in line with austerity and neoliberalism?

To return to the Togliatti theory, if people are facing a bleak future for themselves and their children unless they embrace the institutional structure, how can they possibly unhinge from cultural hegemony, which is all they hear and see in the media, and in any institutional or social setting? How can people break away from bourgeois values and practices when the pragmatic realities of daily life do not permit it? This sense of ‘bourgeois pragmatism’ is also an integral part of the brainwashing process, to be absolutely crude about it, given that indeed this is a result of multifarious forces from society and the result of long-term historical and traditional (religious and secular) influences.

This concept of bourgeois pragmatism that has its roots in the 19th century, made a return in the 1980s onwards with Richard Rorty among others who adamantly opposed social revolution, any more than they believed in redemption of human beings or their progress through revolution. Unlimited freedom and allowing people to muddle through their problems is what these advocates of ‘bourgeois pragmatism’ favored; in short, early 19th century-style social and economic conditions.

Arab Spring and Cultural Hegemony

If cultural hegemony works to prevent social change, how do we account for Arab Spring revolts, regardless of meddling by foreign elements interested in subverting them and seeking regime change and a new and deeper form of integration into Western capitalism? If by the word ‘revolution’ we mean systemic change, then Arab Spring revolts did not result in systemic change at all, and in fact only regime change took place. If by the word ‘revolution’ we imply grassroots, then Arab Spring revolts do not fall in this category, because there was heavy outside interference, especially in the cases of Libya and Syria, but all across North Africa. Where political and economic conditions are either the same or much worse than before Arab Spring.

It is true that political change has resulted, but it is not institutional change by any means where Arab Spring has taken root. Still, how do we explain that an otherwise ‘traditional’ religious society, somewhat influenced by modern secular culture and using high tech communications, manage to have a segment of its population mobilize for change, albeit limited to political regime and with external political, financial and military interference? Does Arab Spring prove that the cultural hegemony theory is wrong, or does it validate it, and what are the lessons for the rest of the world’s grassroots movements?

Arab Spring was a revolt against secular, one-party state regimes that lacked legitimacy from the ruling population and represented a notion of sovereignty identified with the early Cold War instead of the 21st century. Muslims rebelled against such regimes to bring change that would reflect traditional values and practices through domestic and foreign policy that their governments did not represent. Cultural hegemony actually worked to promote Arab Spring, given that the rebels by far wanted a return to Muslim roots and social justice within Muslim institutions.

One reason we fail to see progress on women’s issues, democracy and human rights in the Middle East, as the West defines those concepts, is precisely because cultural hegemony, especially in the context of ‘political Islam’ operated all along behind Arab Spring. Political Islam, the mixing of religion and politics, has alienated a segment of the Middle East-North African population, but it remains the principal dynamic in Arab cultural hegemony.  At the same time, the police and military played their traditional role in making sure there was no structural change. Does the failure of Arab Spring signal failure of uprisings in the Western World, or was this a special case of traditional societies undergoing “social venting” with the considerable external influence subverting the grassroots movements interested in systemic change?

Conclusions

There are conservative analysts who assume that more than anything people crave safety and security. Cultural hegemony rests on the fears of the people who have been conditioned to accept the status quo and avert risk when it comes to securing a new social contract that would represent all people. Some advocates of democracy argue that actualizing their potential is just as important for human beings, but this entails having an institutional structure that permits and promotes those possibilities. I have argued in the past that uprisings are very possible in the 21^stcentury, especially after the next inevitable deep recession, but systemic change is highly unlikely.

Many factors have to converge for a revolution to take place and bring about structural changes. It is true that revolutions rarely take place amid economic contractions, although economic hard times eventually prepare the stage for uprisings that may fester in the minds of people for many years before they act. Moreover, it takes time for grassroots movements to form and consolidate, assuming they do not become co-opted. Modern technology has made it possible for cultural hegemony to be challenged, but it has its limitations. Real (objective) conditions (socioeconomic status and lack of prospects for a better future amid a miserable present) in peoples’ lives must be such that they will free themselves of cultural hegemony’s grip to embrace social change and then act upon it.

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Part IV: Inequality and the crisis of capitalism and democracy

March 24th, 2015

 

By Jon Kofas. 

 



Solutions to the Income Inequality and Declining Democracy

There is no shortage of possible solutions for rising income inequality and declining democracy in our time. Nor is there a shortage of people who dogmatically claim they have “The Answer” as though it is a miracle cure for bad breath. There is no Shangri La, (mythical Himalayan utopia) or any kind of utopia except in Plato’s Republic and Thomas More’sUtopia, any more than there is a possibility for an egalitarian society because more than likely there will always be elites.

Human beings will probably never achieve the ideal of equality on this earth as religions conceive of it in spiritual terms. This does not mean that the struggle for social justice and equality must yield to unchecked greed, power and privileges by the elites, official and private sector corruption that is parasitic to the economy, institutional decadence at the expense of democracy, and tyranny by the few so they retain their privileged status. Solutions depend on one’s ideological perspective and for the purposes of simplicity I have divided them into three categories below, though there are many nuances within these listed.

1)      The Neo-liberal Solution:

The ideological roots of this solution can be traced to Adam Smith at the end of the 18^th century during the nascent phase of the Industrial Revolution in England. Continue with the neo-liberal policies and allow the market to determine the social structure, no matter the level of inequality and damage to the social fabric. Do not change the political economy regardless of the growing inequality it creates and how much it undermines democracy because change would only come at the expense of productivity efficiency, competition, innovation, and investment.

If preserving the status quo is of the utmost importance, proposing greater equality and more democracy is to advocate Socialism, a system that failed in the 29^th century in the Soviet bloc, China and other Communist states. Besides, no matter what the UN, World Bank and numerous organizations and social scientists contend, inequality studies are vastly exaggerated and their goal is to undermine the vitality of capitalism. Inequality is a distraction from the “real issue of freedom”, that is to say, freedom to maintain the existing social order, to buy political influence through campaign contributions, to maximize profit and minimize costs, including pay workers whatever the employer wants not what government legislates in order to lessen inequality. (James Pierson, The Inequality Hoax)

Income redistribution from the rich to the middle classes is an anathema to neoliberal apologists of income inequality. However, they have no problem with the fiscal system as a mechanism for income redistribution from lower and middle class to the rich and to sustain corporate welfare capitalism. Apologists of the status quo oppose tax increases for higher-income groups, while advocating low wages, slashing social programs, retirement benefits, and social programs ranging from school lunches to Medicare. The only way to deal with inequality is for each individual to improve his/her own condition through education/training, not through public spending for such programs. Besides, there is always philanthropy by individuals, private organizations, and businesses generous enough to give of their own free will. (Jamie Peck, Constructions of Neoliberal Reason)

2)      The Reformist or Keynesian Solution:

The ideological roots of this solution go back to the 19^th century social democratic solutions opposed to monetarist orthodoxy that merely concentrate wealth and increase inequality. A policy mix of political economy based on Keynesian economics (1930s New Deal) would be a good start to undo the damage that neo-liberalism has caused around the world in the last four decades. Raise income taxes on the wealthy, provide more support for education, training, and research and development, and offer incentives to business to hire and offer above minimum wage, and raise the minimum wage law. Close tax loopholes and crack down on offshore accounts hiding trillions from their respective governments.

Strengthening the working class is the only way to strengthen the weakening middle class and this means nationalizing the educational system that reflects socioeconomic polarization, with the rich going to best schools, and the rest having to suffer through mediocre ones. The Keynesian school of thought recognizes that capitalism left to its own devices will self-destruct and take down with it democracy.  The only way to save democracy and the “market economy” from predatory capitalism is for the state must interfere to rationalize it and protect the middle class and workers who are powerless against the financial elites. (Duane Swank, Global Capital, Political Institutions, and Policy Change in Developed Welfare States;  Danny Dorling, Inequality and the 1% )

3)      The Socialist Solution: The ideological roots of Socialism are European, predating Marx and Engels, but gaining enormous intellectual momentum after the European revolutions of 1848 that contributed to raising working class consciousness and contributing to representative democracy throughout the continent. There are varieties of Socialism and there is fundamental agreement on the goals, though not on the modalities of what remains largely a utopian solution as far as many people are concerned. In the absence of systemic change of the political system that would overhaul everything from fiscal policy to labor, education and health policy, inequality under democratic regimes will continue to become worse because of capital concentration.

How likely is systemic change, how does social discontinuity come about, and even if it takes place does this mean trading one set of existing elites for another, as was during the French Revolution that ousted the nobility to replace it with the bourgeoisie. Does democracy in fact work if the state has to force equality top-down on a segment of the population that simply does not believe in it and wants to live in a hierarchical society? If democracy is to survive and be viable, then finance capitalism, which is by nature parasitic – concentrating and siphoning off wealth instead of creating it and distributing it more equitably – cannot be the hegemonic force behind the state that drives policy at all levels. (Jeremy Reiman and Paul Leighton, The Rich Get Richer and The Poor Get Prison: Ideology, Class, and Criminal Justice)

If “democratic governments” see the root causes of inequality and poverty in terms of a technical fix for natural and manmade problems, then the solution is really technocratic than political. Here is what the World Bank as well as many democratic governments like India regard as causes of extreme inequality.

1) Natural disasters; drought, flooding, etc.

2) Agricultural cycles and global supply-demand fluctuations;

3) Environmental degradation and derivative costs;

4)  Lack of technology and the right technology to address problems;

5) Lack of education or more targeted education, then the solution is to address these problems through technical means.

6) Lack of the proper infrastructure for optimal resource

7) Lack of or poor strategic economic planning for sustainable growth

8) Inadequate investment incentives

9) Failure to decentralize production geographically

10) Failure to diversify the economy

11) Failure to achieve social cohesion owing to the social fabric breaking down and exacerbating socioeconomic inequality

The World Bank, OECD, African Development Bank, Agency for International Development, UN agencies, and other national and international organizations see the income inequality problem from the same technical perspective as neoliberal apologists of the political economy, proposing technical solutions that only exacerbate the problem for future generations. I want to emphasize that the problem is not the lack of studies on income inequality, not the cliché “sustainable development” fits all solution as though this elements will magically end growing inequality. I walked into the World Bank bookstore the other day and there were many books dealing with poverty and inequality, in addition to quarterly pamphlets and online material the Bank has available. The problem is that neoliberal “reform solutions” are the cause of income inequality as history has proved from the 1950s to the present. To have more “neoliberal solutions” from the culprits of inequality and poverty is absurd.  (Catherine Weaver, Hypocrisy Trap: The World Bank and the Poverty of Reform)

Besides structural problems in the political economy, without a doubt, wars have always been a cause of widespread misery and poverty on the losing party, and often on the “winners”, while a few profiteer in the process. Excessive military spending has brought down civilizations from Athens in 5^th century B.C. to the Roman Empire in 5^th century A.D. and the British Empire in the early 20^th century. From the dawn of civilization when city-states in Mesopotamia and Greece waged war to secure trade routes, to loot, to gain prestige and glory, while maintaining a hierarchical social order. In modern history from the Commercial Revolution (16^th century) onwards, wars were waged for market share, raw materials from energy to strategic minerals, all contributing to the economic and political strength of the socioeconomic elites.

Even if the goal of war was to benefit the rulers of the country, the tangible benefits accrued to the socioeconomic elites at the expense of the broader population. It is simply hollow propaganda that any modern nation-state under capitalism launches wars for ideological considerations linked to altruism and not profit for the socioeconomic elites, just as it is raw propaganda that military spending helps the civilian economy on a sustainable basis. The end result of chronic excessive defense spending is greater inequality and decline of the civilian economy. (Paul Kennedy, The Rise and Fall of the Great Powers; D. Acemoglu, James Robinson, Why Nations Fail: The Origins of Power, Prosperity, and Poverty)

Defense allocations in 2011 stood at $1.2 trillion. This was money benefiting mostly defense contractors and consultants, devoted for parasitic and corrupt enterprises that does not produce new wealth for society, contributes to income inequality and degradation of democracy because militarism reorients people toward authoritarian ideological perspective. The combination of the defense budgets and the corporate welfare capitalist system are impediments to productivity and a more equitable share of wealth for the middle and working classes.

Besides defense spending, corporate welfare siphons off enormous resources and simply transfers income from the bottom income groups to the top. For example, the US Export-Import Bank provides huge export subsidies for the largest US corporations. The same holds true for EU subsidies of European multinationals, although the US and EU have been blaming each other for subsidies. The EU has often demanded that the World Trade Organization (WTO) impose punitive fines on the US for granting multi-billion-dollar tax breaks to Microsoft, General Electric, Boeing, and others that hardly need subsidies. The corporate welfare system and defense spending are inexorably linked to the political economy of uneven development and social inequality. (T. M. Kostigen, The Big Handout: How Government Subsidies and Corporate Welfare Corrupt the World We Live In and Wreak Havoc on Our Food Bills)

Philanthropy anti-Poverty Programs

Will global poverty end if the 1000 richest people and the next one million richest donate all their wealth? Of course not! Charity has never been the solution to the problem of unequal distribution of wealth and labor values. Neoliberals argue that philanthropy is the solution to poverty, while social democrats maintain anti-poverty programs help decrease inequality and provide needed assistance for the lower strata of society. In a recent announcement, the world’s richest people (a few dozen billionaires) tentatively agreed to give away to the charities of their choice half of their wealth, which amounts to $3.5 trillion, or just over one-quarter of the EU’s GDP. Thirty people own 6% of the world’s wealth. Meanwhile, 80% of the world’s population share 20% of the world’s wealth, making billionaire charity a godsend gift to the wretched of the earth. About 1000 people on the planet, according to Forbes, own roughly 10% of the world’s GDP, while one billion people do not have access to drinking water largely because a handful of multinational corporations, in which the billionaire philanthropists own most of the stock, own water rights around the world and charge exorbitant utility rates for water that IMF and World Bank insist must be under private ownership. (Tim Di Muzio, The 1% and the Rest of Us.)

About two billion people are victims of chronic malnutrition and lack of medicine, largely because multinational corporations, in which billionaire philanthropists own most of the stock, do not make it affordable for people to eat and have medicine. Water, food, health, education and affordable housing are among the problems that billionaire philanthropists want to address. The political economy, which made the same philanthropists billionaires, created the aforementioned problems in the first place. Exploitation of the public by a handful of fraudulent investors determined to continue manipulating markets, shield their wealth in tax heavens, so they can amass greater wealth is indeed a Constitutional right under free speech protection, as far as neoliberals are concerned.

While charity is fine to meet emergency needs, it hardly solves the chronic problem of closing the rich-poor gap. Then there are the governments and international organizations involved in the endeavor of aid that historical has been used as bait for trade and investment. Although aid is indeed necessary for emergency cases, aid donors have always used it as bait for trade and investment and not to solve the rich-poor gap that actually widens regardless of aid. There are also the programs of the World Bank and United Nations intended to deal with the poor. These are actually programs intended to result in commercial benefits for large corporations. For example, introducing agrichemicals, seeds, and machinery to convert subsistence agriculture into commercial agriculture does not alter the social structure in India or Africa. On the contrary, it simply integrates more of the segment that was on the periphery of the monetary economy into the world system, forces out the small farmers and results in greater income inequality because of commercialization of the sector.

Specific country programs to end poverty and close the rich-poor gap have not worked either. Let us take Lyndon Johnson’s “Great Society” period of 1964 to 1968 also known as the “War on Poverty”. That program essentially locked in a segment of the population, mostly minorities, into chronic lower working class to poverty status rather than providing opportunities for upward social mobility. Not that the ghettos in London and Paris as a result of similar programs are much better than those of Chicago and Los Angeles.   As much in the US as in UK and France, not only has the rich-poor gap widened since the Thatcher-Reagan decade, but the rich-middle class has also widened since government programs were introduced to close the poverty gap in the 1960s.

The key reason for the welfare experiment failure was government policy intended to maintain the social structure intact and continue with policies that strengthen the rich even more, while providing a social safety net for the rest of the population so that they would continue to support what was presented as “democratic” society. In short, the anti-poverty policies were in fact a means to preserve the system that causes poverty and widens the gap between the rich and the rest of the population. These pretences were dropped first by US and UK in the 1980s when neoliberal policies triumphed and then around the world because welfare corporate capitalism began to replace the social welfare state.

In existence for about five hundred years, the evolving capitalist economic system in different forms causes social and geographical poverty and inequality on a global scale. As the core of the capitalist world-economy shifts from the US to East Asia in the course of the 21st century, there will be increased socioeconomic ineqaulity in the West and relative rising affluence in underdeveloped countries. The irony of mostly Western billionaires donating in large measure to non-Western areas is that in the 21st century the West will most definitely experience the same Third World conditions. Nor is the solution “made in America” (Germany, France, UK, etc.) because at the core of cyclical crises of capitalism is not to make each country more competitive–lower wages and higher quality products–as the apologists of the system insist and Obama argued recently. At the core of the system rests the assumption that capital chases the highest profits wherever it can secure them with the help of the state. Inequality is as much a local and national problem as it is a global one. (Michael Chossudovsky, The Globalization of Poverty and the New World Order)

Socioeconomic inequality and poverty is caused and can only be solved by political economy not by charity, a handful of wealthy people who steal legally and illegally for decades and then decide to give some of their wealth to atone for their greed, or expedient diplomacy by a government(s) wishing to promote trade with the aid recipient. Inequality and poverty cannot be eradicated by private organizations with the support of the UN and World Bank whose goal is the more thorough commercial exploitation of natural resources, labor and markets where poor people live. If indeed inequality and poverty are imbedded in the structure of the political economy, the only solution is structural.

Band aid solutions for Inequality

Most of the programs introduced to combat extreme inequality and to sustain democracy have been band-aid solutions. The proof of failure rests is in the inequality statistics. More for public relations purposes to show the world that there is a commitment to democracy and social justice, band-aid economic solutions have always had the goal of preserving the political, economic, and social status quo. We continue to see such band-aid solutions until the present. Greece is the latest example because it has captured world headlines in the last five years owing to its inability to service the public debt and the reality of its technical bankruptcy causing ripple effects in the euro zone. Austerity policies combined with neoliberal ones de-capitalized Greece, as capital transferred out by the billions from both the public and private sectors from 2010 until the present.

Once the credit dries up and domestic and foreign capital have fled, IMF loan conditionality entails securing new loans to finance servicing existing debt. The result for Greece has been GDP reduction to the tune of 25% annually or $70 billion annually from 2010 to the present for a total of $350 billion. This resulted in gross uneven income distribution and social inequality, not just for this generation but for the next one as well. On 19 March 2015, the instruments of austerity and neo-liberalism came along and offered $2 billion euro for the “humanitarian crisis” that austerity and neo-liberal policies created in the first place.

In making the announcement for the humanitarian aid that amounts to 1.2% of Greece’s annual GDP, EU Commission President Jean-Claude Juncker stated that the money will actually go to help some of the hard-hit companies and targeted groups. First, monetarist and neoliberal policies causes the banking crisis, second the middle class and workers are asked to pay for it, third comes another dose of austerity, and finally, adding salt to injury come the band-aid solution for the poverty holocaust to demonstrate that there are systemic mechanisms to address worst case inequality scenarios.

The global rising inequality has been responsible for sociopolitical instability from Nigeria and Yemen where radical Islamist groups are engaged in guerrilla war to the Middle East and Philippines. Rise in income inequality will continue to have social and political implications and cause instability and further weaken the world political climate and economy as the UN has warned to the shrugs of the richest nations responsible for the crisis of capitalism. There have been calls by both governments and non-profit organizations that poverty will inevitably rise rather than drop. From the inner cities of the US to sub-Sahara Africa, inequality is rising amid governments’ sole focus on the health of the market controlled by those at the top of the socioeconomic ladder.

To circumvent the criticism that they are violating the social contract of public accountability, democratic governments have been using the strategy of co-optation and piecemeal approach to social justice. To divert attention from the systemic inequality, governments have embraced social and cultural issues, while categorically rejecting the inequality issue as core to the political economy. The cultural and social issues include using the issues of racism, sexism, gay bias, environmental degradation, ethnic and religious hatred. Committed to providing women, minorities, gay people, and environmentalists with “equality of opportunity” access, the institutional structure has made these part of the political correctness arena, thus silencing critics about inequality in society.

As long as a small percentage of non-whites, women, gay people, people of all faiths and environmentalists have a stake in capitalism, then why does the larger issue of inequality need to be addressed? If Obama can become US president, how can there possibly be a problem of inequality, racism and social justice in America? OK, so there are the intermittent shootings of block youth, the reality of blacks as the majority populating prisons, suffering higher unemployment and lower income as a whole. But at least there is equality of opportunity! If a Muslim Arab can be a European bank executive, how there be systematic discrimination at the workplace against Muslim workers and vast income inequality in every country from Greece to the UK? In other words, class transcends religion, race, ethnicity, gender, etc, so there is no need to focus on inequality of the entire society. As long as a democratic society demonstrates tolerance for gay people, minorities, women, and even those Green Peace environmentalists causing trouble for Shell Oil, well then what else can a democracy do?

While gender, ethnic, racial and religious prejudice and discrimination are integral parts of social inequality, breaking them apart from the class structure category is an attempt to de-legitimize the more universal issue of systemic inequality and break the solidarity of all oppressed groups by vying them against each other. Women’s issues are only about women as though the millionaire woman in Manhattan is in the same category as the cleaning woman in Detroit; as though the African-American insurance executive is in the same category as the unemployed teen in Manila; as though the Hispanic female owner of her own bottling franchise company is in the same category as her white maid.

These are very old distractions of bourgeois politicians and apologists of the political economy. However, they became pronounced after the Civil Rights and women’s movement of the 1960s and co-optation has worked well in the last half century. If progress had been made on these issue of minority rights one could argue that perhaps it was well worth it. But the record speaks for itself on the socioeconomic status of the vast majority of minorities.

Social Discontinuity

Social discontinuity is not around the corner as some would like to believe any more than revolution that would overthrow capitalism. Even when it is unfolding with society showing strains in all institutions, the vast majority of the population will not notice that anything unusual is taking place. When social discontinuity was unfolding during the transition from the Fall of Rome to the Medieval World, from the feudal-manorial mode of production to commercial agriculture and long-distance trade people simply went about their lives as though society was “normal”. The transition from the capitalist world economy to a new mode of production will evolve gradually and over the course of many decades if not centuries.

Social discontinuity on a world scale will not come as a result of a single national uprising, a spectacular revolutionary uprising, and it will not come because reform movements that attempt to rationalize capitalist democracy have failed. The entire world system would have to collapse from the core outward to the periphery for social discontinuity to take place. Because of the system’s interdependence and close integration as a global one, it will collapse altogether, rather than national capitalism falling in one country while another thrives under the market economy. The glaring absence of social justice, the wide gap between rich and poor will invariably precipitate political instability as we have seen in the last fifty years. Besides internal conflict and political instability, capitalism in its pursuit of more markets will mean more regional conflicts, more instability and greater tensions between countries.

If there is a rise in inequality and less social justice despite the promise of democracy, why then does capitalism survive and thrive not just in authoritarian societies but in open ones where pluralism exists? Mechanisms of social control part of which is indoctrination and distraction are among the answers and explain in part why social discontinuity will take a long time to evolve. Clearly, religion redirecting peoples’ focus from the material world to the spiritual has always been the most powerful and enduring mechanism of social conformity. However, in modern society secular ideology along with religion is the basis for mass indoctrination as expressed endlessly not just through the mainstream media, but all institutions from educational to social clubs.

Focusing on foreign conflicts, potential enemies, and domestic violence against societal harmony are among the ways of the state engendering conformity. As long as there are larger enemies and the culture of fear thrives, people become convinced that the inequality and lack of social justice may not be as significant. Therefore, nationalism as a secular religion and at the core of the hegemonic culture has always helped to keep people docile and resist calls of critics for social progress.

Clearly, one would have to blind not to see that in the last five centuries capitalism has perpetuated the hegemony of the privileged elites enjoying dominant influence in every sector of society, from the political arena to the judicial system to at the expense of the rest of society. Capitalism has at its core the value system of greed feeds on the base human proclivities. This is learned behavior, conditioned by the hegemonic culture that keeps capitalism alive. We learn to worship the culture of materialism, to believe there is nothing else more important in life than devoting one’s life to working and shopping and to self-aggrandizement and atomism at the expense of the community. In paying tribute to his fellow human beings that work and create, that helped to shape his character and life, Albert Einstein was correct that we are indeed social animals, as Aristotle had observed centuries ago, as everyone of us recognizes stepping outside our home, no matter what the dominant culture teaches and how alienating the new technology is trying to make human beings.

As social animals, we are part of a collective totality. We are not sitting on some mountaintop all alone hunting and gathering in the manner of our ancestors 15,000 years ago. We have a social responsibility and that cannot be anything short of a collective response through policy to change the injustice of society. In the age of no places left to exploit in the same manner as in 19^th century Africa, capitalism has turned inward focusing as much on exploiting labor in the core regions of the West as in the periphery of Asia, Latin America and Africa. Frank Fanon’s Wretched of the Earthdealing with French colonial rule in Algeria and the broader issue of Western colonial and neo-colonial exploitation of non-Western countries continues to have relevance in the early 21^st century as the world has become socioeconomically and geographically polarized although we are no longer living in the age of colonization. As difficult and as radical as Fanon’s solution may sound about grassroots action, the concept of “redemptive violence” may not be as far off as we believe to correct the injustices of social, political, and economic inequality.

With the inevitability of periodic short recessionary cycles, and perhaps one or more very deep and long recessions in the 21^st century, how likely is it that the economic and political structure will be able to be sustainable and the road to social discontinuity averted? If the state were to withdraw its massive support from the private sector the capitalist system would begin to collapse and we would be well on our way toward social discontinuity.

Social discontinuity will eventually take place, just as it did when the feudal/material system gave way to capitalism. While we are not near the collapse of capitalism and democracy in the early 21^st century, I would not be as confident if the transition of social discontinuity accelerates toward the end of the century. The revolutions of the 20^th century that took place in underdeveloped and dependent countries exploited by the West and/or Japan – Russia, China, Vietnam, and Cuba – were social but also national expressions against foreign exploitation and assertions of national sovereignty and determining their future without foreign hegemony. All of them had weak state structures with a weak national bourgeoisie and a strong foreign capital, military and political influence. In short, the social revolutions were combined with nationalism as catalyst for popular mobilization that transcended class.

As the developed countries – G-7 – are becoming increasingly socioeconomically polarized, and “Third World” phenomena manifest themselves in the “First World”, the signs of social discontinuity are present as much in the US and UK as they are in developing nations. For those in the bottom of the socioeconomic scale in advanced capitalist countries, health, education, housing, the criminal justice system, and quality of life in general is not much different than it is for those in countries trying to develop their economies. Not just the polarization widening, but the state becoming increasingly authoritarian and institutions increasingly marginalizing the masses will create the new dynamics for social discontinuity.

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Part III: Inequality and the Crisis of Capitalism and Democracy

March 19th, 2015
 

By Jon Kofas.

 



 

Can Democracy Be Viable with a Wide Gap between Rich and Poor?

 

Inequality has been a permanent condition in society since the dawn of civilization. Those who try to justify inequality under democracy argue that it is a “fad” to espouse social justice, to defend the rights of the poor, of working people, and even the eroding middle class. In short, just as clothing fashion is a fad so is advocating for social justice because people are looking for a cause to soothe their psychological needs. This attitude is especially indicative on the part of governments that try to project an image that democracy as a political system works harmoniously with capitalism as an economic one, regardless of the level of social inequality.

Because of modern means of communication in the age of globalization, social justice has become popular with social networks around the world. Progressive individuals and groups identify problems at the grassroots level and propose solutions that would best serve their communities. This is not an issue of pop culture reflecting generational gaps but of grassroots sub-cultures challenging the hegemonic culture responsible for social injustice under the pretense of democracy and thriving capitalism. In other words, the grassroots voices against political and financial elites are universally recognized as the root problem in society around the world. To combat grassroots sub-cultures challenging the elites, governments and business launch public relations campaigns of mega scales showing the world an image that both democracy and capitalist economy are functioning great and no reformist or systemic change is needed.

The Mexican government recently paid SONY Corporation $20 million to make sure that in the next James Bond film there are pictures of modern buildings and a harmonious modern society. Never mind the narco-trafficking, the endemic urban and rural poverty, civil unrest, assassinations of dissidents, systemic corruption at all levels of government and private sector, and extreme inequality. As long as the image projected to the world is a positive one that is all that matters. After all, the assumption is that people believe in images by authority (dominant culture), just as they believe capitalism works for all people because TV game programs (Who Wants to be a Millionaire) make people instantly rich. The expensive PR campaign undertaken by Mexico is nothing in comparison with ceaseless US PR campaigns at home and abroad. that has a widening rich-poor gap and weakening democracy but insists on exporting its institutions, or rather a mythical image of them, to the rest of the world, while dismissing criticism as a “fad” that will pass like clothing fashion. (The Center for Media and Democracy’s PR Watch; Joe Soss, Remaking America: Democracy and Public Policy in an Age of Inequality)

The US political system is based on an 18^th century Constitution and a two-party system with which the majority citizens identify and accept as the “norm”. Alexis de Tocqueville believed that the American system combined democracy and capitalism that captured the imagination of the majority in the 19th century. Of course, such a system included slavery, excluded Native Americans from the mainstream, did not permit women to vote, marginalized non-Western European ethnic groups, and had anti-union policies for workers trying to secure rights in trade unions. Apologists of the system would argue that freedom of speech, religion, and cultural expression are at the core of American democracy that is a model for the world. These are all values of a middle class society, with 18^th century northwest European urban intellectual and commercial roots.

This is the ideological environment from which the US emerged as an independent nation on behalf of commercial, banking, and agricultural elites represented in the Republic, with the theoretical language in the Constitution and Bill of Rights of extending rights to all men. In reality, what do these and many more freedoms added in the last two hundred years mean to anyone on the margins of or outside of the institutional mainstream? What does American freedom mean to a working mother in rural Alabama? What is the meaning of such “American freedoms” to a coal miner who knows of the American Dream but who will never realize it. What exactly can the poor do with bourgeois freedom and promises of dreams that never materialize? Freedom is a nebulous concept unless one is incarcerated, and the overwhelming majority of those who are belong to minority groups and the poor largely. This is largely because the state has chosen the punitive policy route to deal with the growing socioeconomic gap. (Loïc Wacquant, Punishing the Poor: The Neoliberal Government of Social Insecurity)

Freedom is precious thing but it does not have the same meaning for a billionaire as it does for a janitor. French satirical newspaper Charlie Hebdo received a great deal of support from those believing in “freedom”, just as has WikiLeaks founder Julian Assange and former NSA computer worker Edward Snowden. In every single case, these were issues primarily preoccupying the middle class around the world, as I seriously doubt farm workers in rural Philippines, Guatemala and Ghana had as much interest as a middle class professional in London, New York, or Tokyo. Freedom is not some abstract ideal in life, but a commodity subject to the income status of the individual.

The “commoditized self” is reflected in how companies advertise products and services, projecting the message that their products and services will lead to a better, fuller and truer self. The commoditized self is subject to and reflects socioeconomic status, as it did during the European Age of Aristocracy (1688-1830). Just as an 18^th century French aristocrat enjoyed more freedom than a member of the Third Estate, so does a 21^st century billionaire enjoy a great deal more freedom in a democracy than a coal miner dying each day to feed himself and his family. Considering the poor have little freedom in comparison to the rich and a commoditized self of less value, they turn to religion and try to find freedom and a higher truth through faith in God. If this world is cruel, unjust, unequal for the masses, the spiritual world offers equality for all and eternal contentment. Democracy allows and even encourages religious worship as we see by the official positions of governments toward religion as much in the US as in developing nations, and values it just as much as it does the media as a tool of engendering mass conformity. (J. M. Barbalet, Citizenship: Rights, Struggle, and Class Inequality)

Without freedom of the press there cannot possibly be a functioning democracy. However, what if the mainstream media is under corporate control, news is really a sanitized version of government and business propaganda and the only issues raised are those intended to induce conformity of the masses to the system? Can this still be called democracy?Can the working poor eat freedom to kill hunger pains, use it for clothing, housing, to secure clean water, food, and medications? What relevance do Western bourgeois freedoms have for the working and non-working poor of the world, when in fact they are a privilege reserved for those that have already secured the rest of life’s material comforts? If freedom from poverty is a human right and if observance of human rights is a core value in a democracy, then most of the world’s democracies, among them the US, are violating human rights and cannot be called democracies. (see Harri Englund, Prisoners of Freedom: Human Rights and the African Poor); Thomas Pogge, Freedom from Poverty As a Human Right: Who Owes What to the Very Poor?)

Popular sovereignty is one of the fundamental values of democracy, so is personal and community development, and social justice. To what degree does a country labeling itself “democracy” uphold these values not just in theory but in practice, beyond the hollow myth of someday achieving the dream of riches under capitalism? Can a country with very high income inequality maintain democratic institutions and a viable social fabric, or is it merely a façade for a crypto-authoritarian state projecting itself as “democracy” to its citizens and to the world? As some scholars have argued, the poverty of people necessarily means the poverty of democracy. The issue is that the social contract under democracy cannot possibly be fulfilled in a society socioeconomically polarized with even greater prospects for downward socioeconomic mobility. Even for Brazil, one of the fast-growing BRICS members, inequality has persisted as has the continued absence of social justice despite the remarkable GDP growth that markets stress as proof of success. (F. Fukuyama, et al., eds. Poverty, Inequality, and Democracy; Marcos Mendes, Inequality, Democracy, and Growth in Brazil).

There are varieties of modern democracies from the most progressive Norwegian model that consistently earns the highest praise for its commitment to human rights and social justice to Nigeria that is mired in endemic official corruption and has been plagued by internal conflicts from the Biafra uprising (1967 to 1970) to varieties of rebel groups in the last half century all the way up to the present rebel Muslim group Boko Haram. Any country that has elections can call itself a democracy, no matter how unrepresentative the system of the people and how it violates civil rights and human rights, and no matter the level of socioeconomic inequality with a high percentage of the population marginalized from the institutional mainstream.

India is the world’s largest democracy. Despite having one-third (400 million) of the world’s poorest population that has been rising since 1980 along with the poor population of sub-Sahara Africa, the Indian economy in GDP growth terms has been doing fairly well in the last three decades. Apologists of Indian democracy, such as it is, could argue that it has elections as though the electoral process is the alpha and the omega of democracy. This means that no other criteria is considered, such as the quality of life for the broad masses of India’s 400 million poor, a number larger than the entire US population.

Once we begin to examine the meaning of democracy in India we discover that the constitution is written to do erase the caste system of the past and build a casteless society. We see no evidence that what is written in the Constitution has become reality since independence. Combining the complex caste system with massive endemic corruption and a plutocratic clientist or crony capitalism provides a better picture of what “democracy” means. (India ranks 85^th among 175 nations in the corruption scale) linked to the public sector, with politicians buying votes with everything from cash to heroin.

According to former Chief Election Commissioner Shahabuddin Yaqoob Quraishi: “We [Election Commission] do not know the nature of this [80 per cent] funding. Is it coming from the mafias? Is it related to drugs or crimes? No one has any idea. We do not know if it is corporate funding…Why the EC asks to stop these collections from corporate groups is because you [political parties] get beholden to this. If you take money from corporate groups, you will end up giving them contracts … so it is not just fund collection. It is about their [political parties] nexus with corporate groups and it is very serious, while everybody knows about this. It is crony capitalism led by corporates which is running the country. They get their bureaucrats … their ministers appointed”. The Hindu, (22 December 2014)

The electoral system that India equates with democracy not only lacks transparency, but it hardly addresses the welfare of its citizens, focused only on capital concentration for those making campaign contributions and perhaps bribes and hoping in this manner to raise GDP levels regardless of the income distribution issue. This is because India and other governments under the capitalist system view poverty and income inequality not as a systemic problem that the political economy generates but as a “technical” matter requiring “technical” solutions. If social inequality as inherent in capitalism is never identified as the core problem of uneven income distribution owing to the process of legalized state-sanctioned appropriation, then the problem will never be solved, whether in India or any other nation. India’s “democratic” institutional structure is rooted in its traditional past and heavy British colonial influences. Regardless of the lofty democratic theory, in practice the system favors males to the detriment of women, favors the urban wealthy to the detriment of urban and rural poor, favors foreign corporations over the welfare of its own citizens working for such corporations to the detriment of their own health – the Bhopal gas tragedy 1984, gas leak incident remains the world’s worst industrial disaster indicative of corporate hegemony over the state.

One could easily argue that conditions in most countries, including many developed ones are not very different, although there may be differences in modalities of how money changes hands from the rich to politicians who are then indebted to award contracts and conduct policy favoring the privileged socioeconomic elites. In other words, crony capitalism and “clientist” politics so characteristic of non-Western countries retards democracy and contributes to economic inequality, but so does the legalized system of capital appropriation in the G-7 nations.

Despite its record as corrupt and extremely hierarchical society, India is part of the fast-growing BRICS countries with great prospects. It has less economic inequality than the US where capital is far more concentrated and downward social mobility a reality since the early 1980s. As a capitalist “democracy”, India has one of the largest middle class expansion rates in the world whereas the US has suffered contraction of its middle class and has worst prospects in this century than India for upward social mobility. Do these statistics make India a more promising democracy than the US, although in both countries the ruling political parties serve the same elites that are responsible for perpetuating inequality in society?

Not very different from India, Mexico, Chile and Turkey are democracies where capitalism has thrived in the post-World War II. However, these countries are the top three in the world with the greatest income inequality, followed by the US occupying the number four spot and Israel rounding out the top five. Interestingly enough the top ten countries with the least income inequality are all Scandinavian and East-Central European – former Communist countries. At the current rate of income inequality in many countries calling themselves “democracies” the income gap will widen and the so-called democracies will become less democratic. Because the capitalist system and its beneficiaries do not permit better income distribution to benefit the middle and working class, democratic governments have been dealing with the contradictions of growing inequality by adopting stricter laws and police methods toward the lower classes. (Claudio A. Holzner, Poverty of Democracy: The Institutional Roots of Political Participation in Mexico;  Kayhan Delibas,The Rise of Political Islam in Turkey: Urban Poverty, Grassroots Activism and Islamic Fundamentalism).

The world economy is in cyclical structural cycles of expansion and contraction. There is no doubt that in the next contracting cycle the number of people in the world who will languish in abject poverty will rise, while the middle class throughout the Western World will continue to shrink as it has been in the past 30 years. The chronically malnourished (currently just under one billion) will increase while the real value of labor decrease and middle class living standards will lower throughout Western nations, with few exceptions, among them Canada and Australia. The United Nations working with various private and non-governmental organizations to reduce world poverty keeps promising the world that the goal is zero poverty within a few years. Yet, the reality of the existing political economy continues to disprove the UN and apologists of capitalism that ask people to keep their faith in a system that perpetuates inequality and exacerbates social injustice.

When the issue of poverty is raised, educated people who should know better rationalize it by utilizing the Malthusian argument. There are too many people and too few resources, therefore there will always be poor people in the world. Very few have argued that there are not sufficient resources to bail out capitalism to the tune of several trillion dollars paid by labor and the middle classes to strengthen a system that causes and maintains poverty on a world scale in the last recessionary cycle that started in 2008.

There is absolutely no problem transferring massive wealth through taxation, wage policy, and subsidy programs from the middle and lower classes to the wealthiest because this is the neoliberal dogma that maintains the privileged financial elites, and the dogma that the IMF, World Bank and OECD preach. Unless poverty eradication is somehow linked to a massive foreign investment and trade program that would further appropriate resources and concentrate them, no government, UN transnational or other agency is willing to support. Anti-poverty programs have become a pretext to further exploit the areas where the poor are concentrated.

Feeding a starving child that faces death every five seconds is not nearly as urgent for the state as buttressing finance capitalism, because the value system on which capitalism is predicated rests on creating the wretched of the earth, to borrow Franz Fanon’s book title, so that capital accumulation can continue to thrive. The value system and institutional structure in modern society is such that it has shaped the mind not just of the rich, but of the middle class, workers, and even the poor to worship wealth accumulation no matter the human cost. The modern hero is the billionaire that the rest of society must worship like serfs worshipped saints in the Middle Ages. And if the billionaire is a philanthropist who has given back some of the wealth she/he had appropriated through a system that promotes capital concentration, then that billionaires becomes a superhero and held as the model world citizen, rather than robber baron that she/he truly is.

Besides internal forces of inequality as we have seen only from a synoptic perspective, there are also external forces. The colonial power determined class formation and institutional structures in countries that became colonies, semi-colonies, or spheres of influence. For example, Nigeria was a colony and its division of labor and social inequality was molded during the age of colonialism. Even after colonial rule, the legacy of colonial institutions remained as multinational corporations dealt directly with the national government beholden to foreign capital and foreign governments for military aid. Having an elected government of indigenous individuals was fairly meaningless when foreign capital and governments retained a preeminently influential role in determining the unequal social structure.

External dependence or the phenomenon of dependent capitalism that has its roots in colonialism is also a major factor in geographic and social stratification and inequality. Europe, the US and Japan exploited the labor, markets, and raw materials of non-Western countries, helping to develop a comprador (dependent) capitalist class as an intermediary, along with a dependent political system through various means from intimidation and coercion to bribery. The core countries in the advanced capitalist countries, north Europe, US, Japan, Canada and Australia have been responsible for the geographic and social inequality beyond their own borders. (I. Wallerstein, Africa and the Modern World)

The integration of the non-Western countries into the core economies through loans, trade, and investment determines the division of labor in the latter. Because self-sufficiency in an integrated world economy is implausible as national capitalism, the world division of labor is the outcome of a world capitalist system. Uneven terms of trade and uneven labor values between the advanced capitalist countries and the developing ones account for low living standards and polarized socioeconomic conditions in the latter.

External dependence naturally keeps a political regime beholden to the patron country or countries under a patron-client integration model NAFTA is a good example of this. The German-dominated EU is also evolving into patron-client integration model intent on the more thorough exploitation of cheap labor in the periphery nations with massive capital transfers to the core, using public debt as a catalyst. Inequality in Mexico has a lot to do with Mexico’s relationship with the US just as inequality in the southern and Eastern EU members has a lot to do with their relationship with Germany and northwest Europe. Paul Collier, (The Bottom Billion: Why the Poorest Countries are Failing and What Can Be Done About It).

Comprador politics and economics is not merely a question of economic and political dependency as we see in the case of hegemonic US over Latin America (1898-present), or northwest Europe (mainly Germany) over Southern and Eastern Europe, but it is also a question of national sovereignty and external forces causing internal inequalities. The issue of national sovereignty and extreme social inequalities was at the root of Arab uprisings. Of course, the US and northwest Europe reintegrated those economies into the international market system once the dust settled, thus nothing changed with regard to extreme inequality in those countries. The global division between strong national sovereign countries limited to the G-20 and within those the G-7, on the one hand, and the weak comprador nations as represented by the bottom 180 nations poses a major question of whether democracy can exist in societies whose destiny rests in the hands of the Great Powers. (Andre Gunder Frank, Lumpenbourgeoisie: Lumpendevelopment)

Can there be less socioeconomic polarization in countries with a weak national capitalist class and strong comprador bourgeoisie, with weak national state structures that yield to the rich nations and to powerful multinational corporations that also enjoy the backing of the IMF, World Bank, OECD and World Trade Organization.  It is true that economic development and social harmony essential to political stability cannot take place where social injustice thrives on a chronic basis in a world where people have access to means of communication and know there is a better way.

The signs we have so far from the Arab Spring uprisings, the European grassroots movements and other popular protests from Russia to Chile is that the global model of concentrated capitalism that divides the world geographically and politically results in uneven development and lack of stability. Can democracy be viable under socioeconomic polarization that breeds social unrest and political instability? Considering that the answer to this question has been provided by governments turning increasingly to everything from massive propaganda to massive surveillance of their own citizens, from denying due process to violating human rights, the conclusion is that democracy suffers because the political and financial elites fear it and view it as an obstacle to sustaining their privileged roles in society. Ironically, the French nobility had similar views just before the outbreak of the bourgeois-led French Revolution in 1789.  We may not be on the eve of a revolution in the early 21^st century, but conformity to a system that promises dreams of a better life under capitalism and democracy but deliver them only to an increasingly smaller percentage of the people has an expiration date.

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PART II: Inequality and the Crisis of Capitalism and Democracy

March 17th, 2015

 

By Jon Kofas.

 

 

 

Attitudes of the Rich toward the Poor and Working Poor

 

The study of poverty throughout history in different societies shows that this is man-made and it can be limited if not eliminated completely assuming there is the political will to do so. However, the hierarchical social structure, the political economy and the privileged socioeconomic and political elites are not interested in eliminating poverty any more than they are interested in social justice. It is politically acceptable as it is profitable for capitalists worldwide and the state that sustains state-supported capitalism to perpetuate the existing social and economic structure. The result is that this system is responsible for keeping half of the world’s population living on less than $2.50 per day, and more than 80% of the world’s population living in nations where income gaps are becoming wider.

These facts about living standards are contrary to what the apologists of capitalism are preaching about a better life under capitalism and democracy. Pressed on this issue by the realities of inequality becoming wider despite the phenomenal expansion of capital, one standard answer is that there is no alternative to the existing system, again implying the condition of social inequality has always existed so it must always exist. If within capitalism exists the illegal narcotics and human trade, and everything from guns and gasoline to cigarettes and counterfeit watches, does this make the “shadow economy” (black market) natural as well? Is it natural for the world’s largest banks, from HSBC to Wells Fargo among many others to engage in money laundering for hundreds of billions of dollars for narco-traffickers among others moving capital around the world illegally? Because they are the back bone of capitalism, banks have fines imposed upon them and that is the extent of it, while the unemployed youth stealing from a small shop goes to prison for five years. We are indeed living a 21^st century version of Victor Hugo’s Jean-Valjean hunted down for decades because of stealing a loaf of bread to feed a hungry child.

It is ironic that the poorest 40% of the world’s poor own less than 5% of the world’s wealth amounting to a total of $73 trillion. In other words, 40% of the world’s population has less money than the market cap than just ten US multinational corporations. The irony is that governments, the media and of course businesses, and consultants constantly remind the public that we need more of the same regardless of the potential explosive social, economic and political consequences that accompany gross inequality. In short, accept the political economy and social structure rooted in social injustice as you would faith in God you must not question and only obey. The faithful are rewarded in the afterlife if they remain obsequious to religion, and so it will be for the world’s poor if they just hold on to the hope of rewards to come, assuming they keep the faith and support of capitalism and its institutions. For skeptics refusing to accept capitalism that has the majority of the people in the world living on the margins, the answer is that it is the fault of the individual and not the system.

 “America is full of slackers and deadbeats who won’t work!“ This was the title of a recently published article in the online business news program MarketWatch. Arguing that the real US unemployment rate is actually over 35% instead of 5.5%, the article blames not the capitalist system for generating unemployment and uneven development on the social and geographic scales, but 93 million people for not working. The article mentions that the contracting economic cycle that started in 2008 resulted in a sharp rise of structural unemployment. However, it blames the American people for their anti-work attitudes and not the absence of jobs in the market. This is not much different than the attitude of the apologists of capitalism in the 19^th century when there was child labor, forced labor in the form of “workhouse or spike” and debtors’ prisons. Interestingly, bankers and governments of the EU in our time entertain the exact same attitudes about the southern European countries that have been under austerity from 2010 to the present as reflected in the MarketWatch article about US workers.

Blaming the college graduate who cannot find work in her field, the middle age man who is told he is too old to be competitive, the auto factory worker whose factory closed is typical of how media, businesses, and government, all integral part of the dominant culture, see the problem in the gap between the rich and the rest of society. This is not just in the US which is the Mecca of capitalism but around the world. Such attitudes have deep historical roots, though it is true that throughout the evolving history of capitalism the social fabric has evolve and conditions are better today than they were in the nascent phase of the market economy.

Life expectancy and the quality of life between rich and poor differed as much today as it did 300 years ago, as Fernand Braudel points out in his classic work Capitalism and Material Life 1400-1800. This separate demography for the rich is lost in the scale of our averages. In the Beauvaisis in the middle of the seventeenth century over a third of the children died every twelve months; only 58% reached their fifteenth year; people died on average at the age of twenty.” Peasants reached old age in physical appearance and deterioration by the age of forty owing to lack of proper diet and the subsistence life. On average the rich lived at least ten years longer than the poor and would have lived a great deal longer if they did not engage in excesses. Baudel is correct that the relativism in the rich-poor gap not just at the beginning of the capitalist world economy in comparison with our epoch, but even today between the US and Nigeria, for example makes a big difference. In other words, not just the poverty line demarcation but actual material life, to quote Braudel, makes a difference in the poverty of a New Yorker vs. a peasant in Kenya or one in the Philippines. However, the same relativist argument does not hold true of the rich no matter where they live on earth, nor of the attitudes they entertain toward the poor.

Throughout history, the attitudes of rich people toward the poor were never characterized by a willingness to change the system that causes gross social inequality. Kindness and compassion toward the poor are sentiments rarely associated with the rich, but rather by a sense of aloofness at best, contempt at worst. Studies of attitudes of the rich toward the poor generally indicate a disdain of the former toward the latter, despite claims of living in a democracy that somehow entails “equality” when all around us there is nothing but inequality. Despite the obligatory rhetoric of political correctness in the age of mass politics and mass communication, the structure that sustains inequality remains. As long as officials, businesses, the media and private citizens say and write the politically correct thing, there is no need to change the root causes of social injustice in society. . (See Larry Bartels, Unequal Democracy: The Political Economy of the New Gilded Age).

The worldview of the rich is based on paternalistic attitudes and differs sharply from that of the rest of the population that has no privileges in society and its institutions, presumably based on equality for all. The attitudes of the rich toward the poor have historical roots in the early Industrial Revolution when the Protestant work ethic became an integral part of explaining why a few were blessed with wealth and the many, presumably unworthy sinners that God does not favor, were destined to a life of meager living. Although historically religion molded the attitudes of the masses toward the rich, in our modern era of mass communications secular ideologies have played a dominant role in manipulating public opinion.

The ideological justification for the rich appropriating wealth because the political economy promotes it is something we find concealed behind the rhetoric of individual competition. But how much competition was there at the time that Adam Smith was writing or even today, when the state has always been the pillar of support for businesses, and in all cases if such support is no longer the system will collapse. The myth of “free competition” is constantly contradicted by the role of the state in the marketplace.

To elevate themselves above the masses of the poor, the bourgeoisie attribute to themselves ambition and a keen sense of business savvy combined with a diligent work ethic. This is all in theory. Naturally, the classical liberal view that prevails across the world today is a Western construct that many in the Western and non-Western world have challenged. An integral part of the Western colonial legacy passed on to Africa as well as other parts of the non-Western World, the classical liberal ideology and value system rooted in materialism and individualism is among the exports along with commodities and services. The ugly reality is that capitalism prevails by force, direct or indirect, subtle or obtrusive, at home and especially in distant lands where markets, raw materials and cheap labor are the goals of the imperialist. (see Chinweizu, The West and the Rest of Us).

The value system of individualism imbedded in the capitalist ethics is at the core of the Western Euro-centric world and diametrically opposed to collectivism of non-Western cultures. The same value system also clashes with Christian communitarian ethics within the Catholic Church reformers and especially with Liberation Theology coming mostly from Latin American intellectuals and politicians after the Cuban Revolution. The attempt to view Catholicism through the plight of the poor as Jesus Christ experienced according to the New Testament posed a frightening prospect for conservative and liberals alike because it entailed a challenge to the social structure and elites that the Church protected by distracting the masses with the promise of spiritual salvation. The last thing that the political and financial elites want is a segment of the institutional structure, in this case the church, projecting the image that communities can have a conscience and social responsibility, contrary to classical liberal ideology.  Of course, it is not at all the case that communities lack conscience and social responsibility, but that the hegemonic cultural values of atomism prevail over any collectivist mode of thinking.

Desensitized toward the poor and their wretchedness, the rich are aloof of the masses in society in general. One reason for the aloofness is their belief that society belongs to them while the poor merely serve, at best, and take up space, at worst. These attitudes prevailed in 19^th century England, as much as in early 20^th century US, as they do today among the wealthy throughout the world. The policy that the rich have advocated toward the poor has always been one of government adopting punitive measures against the poor and to protect the rich against the poor whose socioeconomic condition could drive them to criminal activity. After all, the wealthy have always argued that the poor are the burdensome parasites of society and government must not raise taxes to sustain them in life.

This is a theme that a number of European and American novelists explored in the 19^th and 20^th century. It is also something we see in sociological studies that are more scientific from the classic work by Henry Mayhew London Labour and the London Poor, until contemporary studies based on extensive empirical research of the laboring poor from North America to China, from Brazil to India. While before the age of mass politics and democracy there was no need to go through the motions of democracy and equality, today with all the talk of freedom and equality one must pay lip service to social justice because it is the politically correct thing to do, while essentially engaging in practices not much different than robber barons of 19^th century factories and coal mines.

Capturing the spirit of materialism, the lifelong preoccupation of amassing wealth as a cultural phenomenon, Jules Henry made the following argument in the mid-1960s amid the Vietnam War when both Japan and Western Europe had fully recovered from the effects of WWII and adapted the American cultural values of devoting one’s life to wealth accumulation as a way of life.  “I am much concerned with our national character in a culture increasingly feeling the effects of almost 150 years of lopsided preoccupation with amassing wealth and raising its standard of living…When we realize that the rest of the world has the same orientation, a study of what has happened to the American national character may give some insight in what to expect in other parts of the world …”Jules Henry,Culture Against Man.

While Jules Henry took the long view making broad sociological observations about the diffusion of American culture, it is only the hegemonic culture and values that have prevailed around the world, not America’s sub-cultures and values that reflect various minority groups from African-American to native-America, from ethnic minorities to religious ones. The only exception is the commercialization of sub-culture co-opted by the hegemonic culture and becoming an integral part of the mainstream. In other words, everything from music and mode of dress to dance and art that reflects the subculture becomes co-opted and part of the hegemonic culture once it is commercialized. Therefore, the hegemonic culture always has the greatest influence even if it not a reflection of the broader masses of a nation, presenting itself as all-inclusive of sub-cultures.

As Antonio Gramsci, (Prison Notebooks) argued, it is not the case of a national culture, but of the hegemonic culture under the social structure that determines the value system in society. The hegemonic culture and values in the US can be found just as easily in Paris and Rio de Janeiro, in Moscow and Mexico City where there are a few wealthy people enjoying the status of privileged elites and influencing society’s destiny. Cultural diffusion is largely in the domain of the hegemonic culture of core countries within the world capitalist system and not sub-cultures. Needless to say, a billionaire in New York, let us say Michael Bloomberg naturally enjoys not only economic influence in New York but throughout the US and much of the world. This is because Bloomberg molds public opinion by owning media outlets, whereas all of the workers and middle class people combined in New York do not have the influence of this one man who was also former mayor of the city.

In 2014, the world’s 80 richest people had more wealth than 3.5 billion people on the planet, reflecting the extreme socioeconomic inequality that capitalism has been perpetuating after centuries of promising to make everyone rich and not just a handful of people. According to the researchers compiling these statistics, by the end of 2015, the wealthiest one percent of the people will own more wealth than 99% of the world’s population. Amid such enormous wealth concentration, the problem for the wealthy, the governments whose policies account for accumulation of wealth, and the apologists of this political economy is to convince 99% of the world’s population that capitalism is the solution and poverty the fault of the individual lacking the “proper character traits and mental capacity”.  Besides political ideology of classical Liberalism, neo-liberalism, conservatism, Libertarianism, and varieties of right wing and centrist and center-leftist ideologies, religion is also used to justify the political economy of inequality.

The extraordinary thing about the rich is their disdain for the poor is only matched by the admiration the poor entertain for the wealthy. According to a Pew Research survey, those with the greatest financial security are convinced that the poor have it easy because they receive government benefits without providing anything in return to society. Again, we see the theme of the poor as parasites because of the few crumbs they collect in a debilitated welfare state, rather than the rich enjoying the benefits of a corporate welfare system. Furthermore, the wealthy insist that government cannot and must not do more to help the poor who are simply a burden on the budget, thus on the public debt. They do not mention that $2.5 trillion is currently held outside the US by corporations and individual refusing to repatriate the money because they are evading taxes. Nor do they mention the tax loopholes in off-shore accounts and illegal transactions that result in massive drain of income for the state.

Billionaire real estate investor Jeff Greene stated on CNBC that the press misquoted him about his disdain of the poor. “What I said was, ‘the global equalization of wages and technology, which is growing at an exponential pace, has killed so many millions of jobs in America and other Western economies and it’s going to kill them at an even faster pace going forward.’ I said, ‘we have our work cut out if we want to build a real economy, an inclusive economy that I grew up in, that I want to see for all Americans.'”

This attitude of contempt for the poor and the working poor is not just an American phenomenon, but a global one, reflecting the values of our civilization that sees nothing more in life as valuable than wealth accumulation at any cost to social justice.  Do the super rich and the politicians who pursue policies maintaining a system of social injustice have any moral, social or political responsibility for those dying of poverty around the world because of capital accumulation and concentration? The answer is absolutely not because they blame the individual and not the system that maintains an unjust society. When we consider that there are millionaire and even billionaire politicians across the world, then it becomes even more understandable why the disdain toward the middle and lower classes.

In the “The World As I See It”, Albert Einstein writes: “I am absolutely convinced that no wealth in the world can help humanity forward, even in the most devoted worker in this cause…Money only appeals to selfishness and always tempts its owners irresistibly to abuse it. Can anyone imagine Moses, Jesus or Gandhi with the money-bags of Carnegie?” A product of the Age of Reason with profound confidence in the rationalist tradition, something his contemporary Sigmund Freud did not share, Einstein pointed out the obvious about the sickening affect of wealth in human beings, to say nothing of the misery it causes those who lack it because it is concentrated.

A child will die of hunger by the time it takes the average person to finish reading this sentence. If state-directed corporate welfare capitalism is to squeeze more out of labor and further erode middle-class living standards, it necessarily entails that poverty will increase and the rich-poor gap widen. This is in contrast to what the apologists of the non-existent “free market” economy are promising as they continue to espouse even greater wealth concentration despite one percent of the world’s richest people owing more than half of the world’s wealth.

One could argue that this is a reflection of the capitalist value system and more specifically the callous attitude of the rich toward the poor as a reflection of America’s culture just as F. Scott Fitzgerald describes in the Great Gatsby. However, values were not very different a century before F. Scott Fitzgerald when Alexis de Tocqueville was gathering material for his book about American society

“As in the ages of equality no man is compelled to lend assistance to his fellow-men, and none has any right to expect much support from them, everyone is at once independent and powerless… His independence fells him with self-reliance and pride among his equals; his debility makes him feel from time to time his want for some outward assistance, which he cannot expect from any of them because they are impotent and unsympathizing.”(Alexis de Tocqueville, Democracy in America, II, 786)

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Inequality and the Crisis of Capitalism and Democracy

March 16th, 2015

 

 

 

 By Jon Kofas.

 



 

 

Part I: Structural Problems of Extreme Inequality

 

The great challenge of our time is not a clash of civilizations, as many advocated since Samuel Huntington published The Clash of Civilizations. Nor is the world most important challenge the revival of the Cold War in the form of a renewed US-Russia confrontation or in the forms of the evils of unconventional war that the US calls “terrorism”, a generic term governments use to label any opponent terrorist. These issues are manufactured and symptomatic of capitalist countries engaged in an intense world competition for markets and raw materials. This is not very different from the world power structure during the Age of New Imperialism, 1870-1914. The great challenge of our time is social and geographic inequality that threatens not only the system of capitalism creating inequality, but the democratic political regime under which capitalism has thrived in the last one hundred years.

1.      Is capitalism in deep crisis because of the deepening gap between the very rich and the rest of the population, or this how the system works and society has always been organized as a social pyramid? If capitalism is creating extreme inequality what does this entail for democracy that rests on a strong middle class and all institutions on which bourgeois society his built?  Does the fact 1% of the richest people will own more wealth than the other 90% of the world’s population in 2016, and that 80% of the people on earth own just 5.5% of the wealth mean anything, or is it just numbers?

As long as capitalism is relatively stable and as long as the social structure operates fairly harmoniously under such a wide gap between the super rich and the rest of us, then the possibility of “social discontinuity” (systemic change in the social structure, and economic and political system) does not appear likely in this century. After all, throughout civilization in most societies wealth was always concentrated and social structures were always hierarchical with the elites whether secular or religious enjoying privileges.  There were always elites determining society’s institutions and direction while the poor remained helpless and the small middle class tried to exert whatever influence possible at the grassroots level. Why must we be any more optimistic today that elites will disappear when that seems highly unlikely because other elites will replace them under another system?

2.      Does the widening income gap evident especially in the US and Europe reveal a crisis in the parliamentary system of electoral politics, as people lose faith in representative government and turn either to radical left or radical far right-wing solutions? We have seen the rise of ultra right-wing political movements and parties throughout Europe and the emergence of the Tea Party as an appendage of the Republican Party in the US representing some of the most extreme policy positions. These range from anti-immigration and xenophobic agenda to advocacy for military solutions as the only way to solve foreign policy crises. These political parties have a voice in the democratic process because the conservative and centrist parties have moved very far to the right, representing essentially the rich in society rather than all citizens. As long as people equate elections with democracy and social justice, why would the political system suffer any more polarization as it did in the 1930s amid the Great Depression? In the absence of another 1930s-style Great Depression to precipitate sociopolitical polarization, the electoral system can withstand even more income inequality and injustice, more civil unrest, and more shift of government toward police-state style solutions to such problems. After all, people do not believe there is an alternative to the existing political system any more than the economic.

3.      Apologists of the status quo, from politicians to businesses from academics to the media would have citizens believe that the existing economic system is thriving and it will continue to thrive for eternity, a belief first introduced by the apostle of the capitalist manifesto Adam Smith, The Wealth of Nations (1776). In other words, it is as though capitalism transcends history and it has come to earth from the heavens. Therefore, there is no need to reform capitalism by changing policies and certainly no need to do away with it. If the system appears immersed in contradictions and anachronistic in terms of fulfilling its promise to society any more in Adam Smith’s 18^th century Europe than In 21^st century world, it is only because critics and those not deriving optimal privileges are against the system not because there is something wrong with it.

Reformist critics argue that the declining middle class throughout the Western World in the last four decades is symptomatic of an ailing economic system that must be addressed through the political process. If this is not done, then democracy itself will give way to a more authoritarian political system. On the left side of the political spectrum, critics argue that the crisis of capitalism has already given way to a form of authoritarianism with a thin veil of democracy for mass consumption. Capitalism has shown definite signs of decline and it will ultimately fall. This will take a long time, just as Rome was in decline from the death of Marcus Aurelius to the sacking of Rome in the 5^th century. Capitalism’s decline from within will come because it is serving an increasingly smaller segment of the population to the detriment of many losing faith in its promise. This means that it will take down with it all institutions, including the warped democratic political system as it will be evolving toward some authoritarian form, a contradiction in itself.

Scholars, journalists, politicians, business people and a segment of the public know that the world is experiencing a crisis of inequality. Despite the phenomenal Gross World Product (GWP) growth rising from $27 trillion in 1990 to $75 trillion in 2014, owing largely to the integration China and former Communist countries into the capitalist economy, income inequality actually grew during this period because capital remained concentrated in the hands of the top 10 percent. The inequality crisis is not just in Egypt, Nigeria, Kazakhstan and other developing nations under authoritarian corrupt regime, but in the US and Western democratic societies that go through the motions of promising equality but deliver downward social mobility for the college graduates.

With few notable exceptions among them Norway, many of the Western democracies deliver economic and social policies not much different from authoritarian countries that make no pretenses about a pluralistic society. This is not only in European Union countries undergoing austerity, but in the US as the world’s leading capitalist country where inequality is very evident. Although the US is an open society under a pluralistic system, it has been experiencing a crisis in its democratic institutions that has been going down the road of a quasi-police state ever since 9/11, considering there are glaring violations of the Constitution regarding civil rights, and of international law regarding human rights.

Things are not very different for the rest of the Western World where the rights of workers are disappearing and middle class is shrinking, while poverty is rising amid massive capital concentration. This is all justified in the name of markets that governments today equate with the “national interest”, thus redefining the social contract as understood by European thinkers of the Enlightenment as well as Thomas Jefferson and James Madison. The contradiction of democracy’s promise for equality and the downward socioeconomic mobility and rising income gap between the rich and the poor has been the subject of serious studies that ignore the populist propaganda in the media. However, such studies are hardly influential among mainstream politicians loyal to the new “market-centered” concept of the social contract that whatever is good for the rich is good for the nation – reminiscent of the 1920s thinking in America. (See Vicki L. Birchfield, Income Inequality in Capitalist Democracies: The Interplay of Values and Institutions; John Skinner, Capitalism, Socialism, Social Plutocracy: An American Crisis)

On the surface, the capitalist world economy certainly appears sound because of the fact that most people believe they have a stake in it. If they have no stake in it, they have hope for themselves and their children. Just below the surface there are very serious problems owing to a complex web of problems, most of them stemming from a political economy rooted in injustice and the source of oppression and exploitation that instead of lessening it is worsening based not just on income gaps between the rich and the “rest of society”, but on the quality of life in general for the “rest of society”. This does not mean that capitalism is coming to an end any time soon. Nevertheless, it manifests signs of structural weaknesses that will eventually undermine both capitalism and democracy from within. In other words, the real enemy that will bring down the social order is not “terrorism” or another enemy nation like Russia, but the decadent system.

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Greece: Limited options, limited prospects

March 11th, 2015

 

 

By Jon Kofas.

 



 

The day after the Greek left-center party SYRIZA won the election of January 2015, optimism ran across Europe’s progressive quarters, while the conservatives and neoliberals acr4oss the world insisted the new regime was extreme left and it would invite disaster. Just a few short weeks after that election, the world knows that SYRIZA was indeed a center-left regime, one trying to introduce some modest reforms in a bankrupt nation whose future is really the past of even greater dependence instead of the future of greater national sovereignty in all domains from economy to defense.

Greece has always (1832-present) been a debtor country, always suffered balance of payments deficits, always been a dependency of a Great Power, first Great Britain, then the US and more recently Germany. This was true of the Balkans that were northwest Europe equivalent of what Central America has been to the US. The larger question in the 21^st century for Greece is not whether it will remain a dependency as it always has been, and it is not whether Greece can be elevated to the status of Belgium that is about the same as Greece in terms of population but has twice the GDP of Greece and much higher living standards. The future of Greece is actually the past, a reversal to the Cold War when Greece was an economically weak country on the periphery of Europe. Germany has made it clear that it wants Greece to be in line with the rest of the Balkans in terms of living standards, which means several notches down from pre-austerity levels. Therefore, continued EU integration entails not raising but lowering living standards, not greater national sovereignty but much less.

What are the possible choices for Greece in this post-Cold War environment of globalization and neo-liberalism?

a) The Greek Communist Party KKE favors the road to Communism by nationalizing everything, repudiating the national debt, exiting NATO, EU, IMF, and all treaties and obligation. How realistic is this scenario at this point in history, and what is the percentage of the people who would support it? Considering that the Greek Communist Party has about 5% of the vote, this scenario is highly unrealistic and public support would not go above 20% at best even if the KKE came to power by magic. International isolation would be its fate and without a “Chinese-style sponsor” like North Korea has, the regime would fall.

b) Through the conviction of their ideals, Greek SYRIZA (center-leftist ruling party) can try to change the euro zone and the German-imposed patron-client integration model. This is actually what SYRIZA promised before the election of January 2015, along with a long list of social and economic measures it has failed to adopt because the EU will not permit them. The idea that Greece can change the German-imposed patron-client integration model and the current neo-liberal course of the euro zone is even more unrealistic than going Communist. Integration models are not subject to change by the weak debtor client countries whose only option is to abandon the integration model and see if it can survive.

c) Greece could stay the course with austerity and neo-liberal policies that have ruined the economy in the last five years. With weak health care, educational system, and social security, the social fabric has come unglued resulting in one-third of the people near or under the poverty line. One result is a polarized society with the neo-Nazi party becoming the third most popular. As pessimistic as this sounds it is actually the most likely scenario not because people believe the promises about light at the end of the tunnel, but because they fear disaster if they dare leave the tunnel.

d) Greece could try to switch patrons and see the degree to which China and Russia would be interested in becoming the new patrons. However, Russia is facing financial problems of its own, and China would not want to alienate either Western Europe by making Greece a Chinese financial dependency or the US that has important naval and intelligence gathering bases in Greece. Historically, the creditor country that owned the public debt of a small debtor country enjoyed hegemony in all affairs from economic to geopolitical. The idea that Greece could switch patrons from West to East is premature, though not out of the question by the end of the century when China could be the undisputed world leader.

e) Greece could re-establish a modicum of national sovereignty by introducing a policy mix on the non-aligned model of economic nationalism that was popular in a number of countries from Indonesia and Egypt in the 1950s and 1960s. With modifications to accommodate the realities of globalization, quasi-statism and a modicum of economic nationalism with aspects of neo-liberalism has resurfaced in the BRICS nations in the last two decades.  This too is an unlikely scenario because the apologists of austerity and neo-liberalism would immediately baptize economic nationalism just another form of “Communism” as they have in the past.

f) A policy mix that takes into account the current integration model and obligations to foreign creditors along with their demands for internal policy changes toward more neo-liberal course, combined with massive crackdown on public and private sector corruption to raise revenue, and combined with sharp cuts in the defense sector that absorbs 2.1-2.5% of GDP is another scenario. This is highly unlikely because every political party from far right to far left support defense spending.

Greece has been facing a technical bankruptcy and its public debt amounting to 175-180% of GDP in 2015 may not be paid off until the last quarter of the century, assuming no future obstacles. In 2015, Greece has a public debt that cannot possibly be serviced at current GDP growth rates because its revenues are not sufficient to meet internal needs and service the debt at the same time. Foreign borrowing constantly to service the debt only makes the aggregate debt larger in relationship to GDP that has shrunk by 25% under the austerity of the IMF and EU from 2010 until 2015. Because Greece is not an exporting nation and its economic activity is largely resting on consumer demand, and because it has a very low percentage of its population working full time in relationship with other EU countries, it cannot possibly service the public debt. The solution as far as IMF and EU are concerned, take the money from the middle class and workers, thus lowering their living standards even lower.

It is very unfortunate that SYRIZA adopted a left-progressive rhetoric that appealed to a disillusioned lower middle class but in fact it had nothing behind the rhetoric. In this respect, SYRIZA is no different than PASOK elected in 1980 under Andreas Papandreou who promised a Socialist government but by the early 1990s had brought the party and the country in line with neo-liberalism. SYRIZA talked a big game and enthralled progressive within the country, around Europe and around the world. However, the absence of any real leverage in negotiation was apparent very quickly when Athens yielded to everything that the IMF and Germany demanded. After initial negotiations that essentially amounted to no change on the part of the IMF and EU position regarding austerity and neo-liberalism, SYRIZA bought itself a four-month grace period to come up with a more permanent program, presumably another round of borrowing to service the unserviceable debt and another round of measures that amount to income transfer from the lower and middle classes to the creditors.

The Greek voters elected a government led by the center-left SYRIZA that promised to end austerity and renegotiate the public debt so that the country can end neoliberal policies that strengthen a few thousand domestic and foreign companies and individuals, lower unemployment, raise wages and social security, raise GDP to pre-austerity levels around one-quarter of a trillion euro and restore the middle class and workers who have been paying the costs of austerity with an estimate one-third cut in their income levels. The German government, media and financial circles have been arguing that Greece is pressuring the EU, trying to get away not paying the debt, trying to change the rules by which EU members are obligated to follow, and sending the wrong signal to the markets and other debtor nations.

For its part, Athens has argues that Germany has not paid an estimated 40 to 150 billion in war crimes reparations it owes. Therefore, it has no moral authority to speak about dead beats. It does not help of course that SYRIZA has a flamboyant finance minister Yiannis Varoufakis, interested much more in presenting himself to the world than presenting in the best possible light the program of the country he represents. This unfortunate choice for finance minister aside, the problem is the direction SYRIZA wishes to take and not the celebrity-crazed individual who seems to enjoy self-promotion. In that same spot Greece could have had Nelson Mandela and Albert Einstein together and it would not have made any difference to the IMF and Germany that do not want changes in austerity measures or neoliberal policies.

It does not help that Greece has a serious problem with public sector and private sector corruption. One-third of the economy continues to operate under what the World Bank classifies as “black market or subterranean” economy. When the few thousand families that own 80% of the country’s wealth have taken most of their money out of the country, and refuse to pay taxes on their business operations how could any government carry on its duties? Systemic corruption under a system of “baksheesh capitalism” is not going to change any time soon no matter what policy direction SYRIZA or any other regime adopts, and not when there is no effort by the IMF and EU to help Greece fight public and private sector corruption. Fighting corruption is impossible because the largest European and Greek financial interests are involved, everyone from Siemens corporation to Greek shipping tycoons transporting narcotics and illegal crude oil and cigarettes.

Failure on the part of the EU and IMF to help previous governments pursue tax evaders who are primarily the top ten percent of the people owning 80% of the wealth has been a shortcoming, as much as failure to collect back taxes from foreign corporations. Another major failure is the insistence that Greece continue defense buying from Germany and France, despite the sharp drop in GDP. This is reminiscent of what the US was doing in the 1950s when Greece was one of the world’s poorest nations but its defense spending was the world’s second highest behind South Vietnam. Finally, the IMF and EU promised the moon in 2010 when they introduced austerity and neoliberal policies, but have delivered an unmitigated disaster by their own standards, let alone those of austerity critics.

What are the options for Greece and what are its prospects?

OPTION One: Stay the course: austerity and neo-liberalism

One option is to remain in the euro and maintain its quasi-colonial status as it has not just under austerity but since 1832 when the country declared independence and under Anglo-French stewardship provided a Bavarian King Otto to rule over it on behalf of the patron countries that had extended loans to achieve Greek independence. Staying the course without any substantial deviation from austerity and neoliberal policies would be a triumph for Germany and Western finance capital.

The same prospect would be a resounding political defeat for all EU periphery members, sending a strong message to them that Germany is the undisputed patron of the EU operating no different than a colonial master in the 19^th century when public debt was used as leverage for foreign financial, economic, trade, political and military control. Finally, staying the course after promising voters the end of austerity and neoliberal policies would be a major blow to democracy and it will result in polarized political climate. The majority of citizens back the SYRIZA regime at this point, but a few months from now they will want to see results that are tangible in their lives, like lower real estate taxes, higher income, jobs prospects for their unemployed children, etc.

Option Two: Re-establish monetary sovereignty

Another option is for the country to leave the euro zone and take its chances on its own. Establishing monetary sovereignty would go a long way to having a better handle on internal policies that governments had essentially handed over to the IMF and EU. Exiting the euro is prospect that would result in a great deal of misery for the vast majority of the people in the short-to-intermediate term, and something that would send the euro and European stock markets tumbling. Greece is still going to be a part of Europe, Western European companies will still trade with it, which means that European would have no choice but to provide it with liquidity largely because the Greek economy is so integrated with the EU, and the world economy. For example, all auto companies, all electronics companies, all communications companies, all transportation companies, including China’s COSCO shipping, among many others, will pressure their governments to come up with liquidity agreements via Greek banks and Greece’s central bank so these companies conduct business and retain market share.

As for Greek businesspeople, they have already taken out between 500 and 900 billion euro, so they could easily bring some of it back as needed in order to conduct their domestic business. Liquidity from abroad will be slow and sluggish until some stability emerges, but it will be there especially once a new deal is struck on a debt repayment schedule. This is one scenario that would not mean Greece would become an equal to Germany and France because of national monetary sovereignty. After all, Greece was an economic, political and military dependency when it had its own currency and it will be so again. The question here is not whether it will be or not a dependent or semi-colonial country for that is a given The issue is to lessen the degree of foreign control and misery index at home by establishing financial sovereignty.

Option Three: Policy mix with focus on defense budget cuts.

The last option has to do with one of the most wasteful sectors in the economy and one where 10% to 50% of expenses are devoted to bribes not just for government officials, politicians voting in Parliament and others linked to purchases of everything from machine guns to German subs, but even journalists and academics to mold public opinion about the importance of having even more weapons that will never be used. The easy answer for having a defense sector is that Turkey is very strong militarily and it threatens both Greece and Cyprus. Even if Greece were to double defense spending, from 2.5 percent of GDP to five percent, it would still not match Turkey that can easily defeat Greece in a few weeks.  Deterrence against Turkey is simply non-existent. The second argument for defense is that Greece is a NATO member and under collective defense agreements must maintain its current levels. This is actually what prevents the country from making any move, because if it downsizes its defense sector to border patrol, coast guard and domestic security, the US and EU could permit Turkey to have its way in Cyprus and even take a few of the Aegean islands on the eastern-most areas.

Greek defense spending has been one of the highest in the world in per capita terms even in the 1950s when it ranked among the poorest in the world. In per capita terms, Greek defense spending ranked no 7 in the world in 2009, spending $1,230, while France and England spend in the mid-$950s, despite their lofty place among the G-7 richest nations in the world. Even during the austerity years from 2010 until the present, the defense budget continues to absorb 2.5% (2.1% by some estimate) of GDP in real terms, an amount that translates to $5 billion in a country that has been in technical bankruptcy and borrows from IMF and EU to service its public debt.

It is interesting that every single political party from the neo-Nazi Golden Dawn to the ruling center-left SYRIZA, to the Communist Party agree that defense cannot be touched. In the five years during austerity, no one political party ever uttered a word about slashing defense, though they spoke a great deal of the monumental corruption associated with the defense ministry weapons’ procurements. Why is it that no political party has suggested slashing defense to cover very basic needs, and save several billion dollars needed for other expenditures?

One reason is that all of them are nationalistic and believe without what they see as strong defense Turkey would take back the Balkan province it lost in the 1820s. Another explanation is that all political parties know there is no popular support for cutting defense. A third explanation is that all of them are taking money indirectly from defense contractors and governments that want Greece to maintain strong defense. Other explanations include the possibility that cutting defense would only result in higher unemployment in a country with 26% official unemployment. Another reason is that Cyprus among other countries including Israel wants Greece to have a strong defense. No matter what the reason, no political party is addressing the defense issue although here is a sector that could be discussed as part of a broader policy mix to save money amid a crisis. Above all, the US has been pressuring all NATO members including Greece to increase not decrease defense spending because Russia is the new old enemy, at least for now, until further notice.

What option does SYRIZA have amid such dilemma?

The ruling party knows that Germans want Greece to keep buying obsolete weapons that will never be used, just like submarines costing billions but in constant need of repairs even before leaving port. The US needs Greece for its own military purposes and it is not about to permit defense cuts. SYRIZA Prime Minister Alexis Tsipras appointed the independent conservative-nationalist (Independent Greek party) Panos Kamenos to the defense ministry, sending a message that this area of government will not make deep cuts in defense.

Considering that the eclectic leftist rhetoric clashed with the realities of austerity and neo-liberal policies the new government will be following, there is no doubt that SYRIZA has made its choice to accept the German-imposed patron-client integration model under policies that the conservative New Democracy party and PASOK have been following in the first half of this decade. The result will be continued downward socioeconomic mobility and more college-educated people leaving the country. However, this is the history of modern Greece, with the exception of an expansionary cycle coming from 1980 until 2005 when billions borrowed were not invested in the economy but went for consumption instead of production.

There is always the unexpected in politics, the big surprise that may come as a result of a public referendum on accepting or rejecting the IMF-EU terms, staying or leaving the euro. The unexpected could come as a result of a regional war breaking out and changing conditions for Europe, or perhaps more EU members joining the anti-austerity choir and confronting Germany’s patron-client model. I do not regard these as realistic, and believe that even symbolically SYRIZA sent a strong message to the EU elites that fear democracy because they realize it entails catering to the interests of the people.

Although this government should have looked at all possible models of economic planning and development from non-aligned countries and from the BRICS, it should have looked closer at the problem associated with trying to assert partial national sovereignty, and it should have tried to be a lot more honest with the voters that still support it by at least 60  percent according to opinion polls, the question is whether it has learned anything at all from its brief experience in the last five weeks. The easy route is simply to yield to co-optation by domestic and international financial, political and military elites and take its chances fooling the voters in the next election. After all, this is exactly what previous governments did as well. What lessons are there for Spain’s PODEMOS and other progressive political parties in Europe? Do not over promise and under deliver, study all possible options before going to the negotiating table, have several back up plans and always inform the voters honestly about the limited leverage of a debtor nation when negotiating with powers that have enormous leverage as creditors.

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“Collective psychopathology” and US police state methods

March 5th, 2015

 

 

By Jon Kofas.

 



In February 2015, The Guardian published a couple of new stories about the connection between the Chicago police department “black site” at Homan Square and the Guantanamo prison where terror suspects have been kept as political prisoners without ever been charged. Neither the national media in the US nor the Chicago media organizations, including African-American, have pursued this story. Even after the British paper brought these issues to the attention of the public, the mainstream media in Chicago and across the US are ignoring the revelations, a subject in itself revealing about the role of the US media in a democratic society where human rights and civil rights violations occur.

One could assume that publishers are not interested in exposing corruption, torture, detention without due process, violation of civil rights and human rights for ideological and political reasons. Besides, the media assumes that if the police have detained a black man, interrogated and tortured him, while never charging him and keeping him in an undisclosed location rather than in jail, and denied him access to a lawyer there must be a good reason for it. That black man is a suspect of criminal or terrorist conduct and must indeed be guilty. After all, why aren’t the police arresting a white suburban bank executive (for a bank such as HBSC) who has facilitated money laundering operations for drug lords, all based on the bank’s testimony.

The assumption of guilt is almost automatic when it comes to blacks and Muslims in America because the political climate and institutional culture facilitates it. After all, an estimated 40% of prison inmates are blacks when the percentage of the African-American population is 13%. Although the same percentage of whites as blacks are drug users, one in three black males go to prison. The racism rooted in American culture and institutions, especially law enforcement, courts, and prisons, has now shifted to include Muslims, while Hispanics were always part of the targeted minority group.

In the post 9/11 political culture and legal environment, police state methods are justified in the name of law and order and in the name of national security. The convergence of local law and order and national security actually has its origins in the Cold War, but it has assumed entirely new dimension with Muslims as a target group in the 21^st century instead of Communists in the 20th. The ideology is the same, namely to crush dissidents, and people of color and Muslims are “natural” suspects not just for the police but mainstream media and society.

Local civil rights organizations and lawyers have dealt with specific victims of Chicago’s Homan Square and indeed the city has paid out millions in damages. But the culture of racial profiling and illegal tactics remain an integral part of the culture. Just as significant, neither the Chicago mayor’s office nor the US Justice Department is acknowledging any links between Homan and the larger police-state methodology in the US to what has been taking place in Guantanamo as the US Senate report on torture of political prisoners has revealed. The US media is silent on this issue as well, and even The Guardian article has no in-depth analysis of the broader society of an evolving quasi-police state. Instead, the focus is on specific individuals carrying out torture at the Homan Square center and Guantanamo and on a few victims willing to go public with their stories.

A recent US newspaper article on why the media refuses to deal with the Homan Square detention and torture center and its links to Guantanamo reveals that journalists mostly are politically and ideologically in agreement with both the Chicago police department’s torture policy of blacks and with US torture policy of Muslims. The main focus of civil rights groups and lawyers has been on those wrongfully charged so they may receive monetary compensation. Why is the media not exposing the broader problem of institutional convergence between local police departments and Department of Defense treatment of political prisoners? One reason is advertisers on the mainstream media are not interested in the publication exposing cases of such immense magnitude that make the US appear more like Argentina under the dictatorship of the late 1970s than Norway of the 21^st century.

This is not to deny that there is a legitimate role for the police force in every society. Nor is it realistic to deny the legitimate role of the US armed forces as protectors of the nation’s territorial integrity and national sovereignty. There are hardened criminals out there as much as there are politically, ideologically, and religiously-motivated fanatics that have used and continue to use unconventional means to harm at random US interests. How the police and courts handle criminal suspects and how the US government handles political prisoners is important, as is the issue of crossing the line to institutionalizing a surveillance state imposed upon all of society, torturing suspects in “black sites”, and denying them due process.

The issue before us is whether the US is a nation of laws that enforces and not violates them, and whether the Constitution still has any relevance, or whether the counter-terrorism culture overrides the legal system. If indeed the political culture of counter-terrorism converged with racism has taken over then this is leading the nation toward a unique form of authoritarianism within an electoral system. If indeed the US is slipping down the slope of authoritarianism and quasi-police state, then a segment of the American people must have accepted this is the norm. Like other authoritarian societies in the past that embraced collective psychopathology, the US has redefined it value system now so rooted in the politics of power that civil rights, human rights and social justice are impediments rather than democratic principles that government ought to follow.

Political correctness as a veil of a racist and unjust society, the American culture of racism has been an integral part of the police force in American society, no matter the civil rights movements and laws on the books. Reinforcing the racist police culture is the “war on terror” and the culture of counter-terrorism since 9/11. The result is institutionalization of “collective psychopathology” to the degree that torturing people, violating their civil rights and their human rights is the now the norm that the media accepts as necessary, and often criticizes those who dare question the abuses of law enforcement in American cities and CIA torturers. The US Senate report on CIA torture revealed that the US looked to Israel as a model for justifying torture on the basis of preventing “imminent attack” in the future. That the US would use Israel, an apartheid society, as a model makes sense if one accepts that the US like Israel in a state of perpetual war with potential Muslim enemies.

Not the courts, not any agency at the local, state or federal level, not the media or any institution such as a university or church will go on record raising questions about the US government violating civil rights and human rights because there is a price to pay for such criticism and benefits to derive by going along with the culture of collective psychopathology. Psychologist Richard Koenigberg is correct to label political violence “collective psychopathology”. However, this phenomenon is not limited to the Third Reich and to serial killers in the US. The phenomenon of collective psychopathology has become very powerful in the US because of the convergence between the racist-rooted law enforcement apparatus – police, prosecutors, courts, and prisons – and the national security apparatus based on Home Land Security to CIA torturers of political prisoners. If collective psychopathology is a reality in America as much as it was in societies of previous epochs, including the Third Reich, is America a democracy as it claims, and if soc what kind of “democracy”? Just as in Israel the majority is part of the “collective psychopathology” that dictates the enemy must be eliminated by any means no matter how the state circumvents international and domestic laws, so is the case in the US.

Collective psychopathology is part of the cultural milieu and we see it in societies from ancient Sparta to 21^stcentury America. We now have enough evidence from various sources to confirm that indeed the phenomenon that Koenigberg is describing and with which critics of institutional racism and Islamophobia agree is widespread in America. Despite the growing phenomenon of collective psychopathology, the US government and media project an image of a democratic society, an open and pluralistic one on the path of political correctness, a society interested only in the diffusion of its freedom-loving institutions to the rest of the world.

There is now sufficient evidence that the US has embraced enough aspects of police state and authoritarian state methods and policies we can longer argue that the institutional structure is democratic as the Founding Fathers envisioned it. However, one could argue that even James Madison and Thomas Jefferson as the most progressive of the Founding Father lived in a democracy that had slavery. Why then must we not separate in the 21^st century the national security and law and order issue from the rest of the democratic “structure”, just as Madison and Jefferson did? Actually, that is exactly what the two political parties, the media, businesses and mainstream institutions do. In short, collective psychopathology is reserved for minorities always suspect of “criminal proclivities by nature”, and Muslims that the state suspects of potential links to terrorism.

Social-political conditioning of the public mind has been a reality in all societies throughout civilization. Convincing the public today to accept torturing and killing people of different ideological and political convictions because national security dictates as much is a daily reality. Whether the state injects religion into the justification as is the case today as much as during the Crusades, or racist ideology such as Social Darwinism during the European and US wars against native populations in Africa and Asia in the Age of Imperialism, 1870-1914, the goal and end result is the same. Collective psychopathology is not a neutral phenomenon, but rather there are those who benefit from the suffering of victims. In other words, this phenomenon serves a political, economic and social purpose today as it did in societies past.

Whether it is the case of German citizens living during the Third Reich knowing of systematic extermination of Jews, Gypsies and Communists, Russians under Stalin knowing the Kremlin was assassinating and imprisoning dissidents, or Americans since 9/11 accepting the police-state counter-terrorism culture as normal, all are morally repugnant and indicative of manifestations of “collective psychopathology”. Perhaps it is true as physicist Stephen Hawking noted that human beings emerged into civilization partly because aggressive proclivities helped them overcome obstacles to survival of the species during the process of human evolution in the last one million years. However, the same caveman aggression proclivities may result in the demise of civilization and perhaps the human race, and collective psychopathology is certainly one catalyst to mass destruction.

Do Homan Square and Guantanamo reveal only the “bad apples” within the Chicago police department and CIA, or do these “black sites” tell us something more America’s value system and society? The Guardian story focused on the specific torturers, not the policy, not institutional problem, not the responsibility of the Chicago political authorities and the US Justice Department that has known about Homan and has been trying to obstruct due process of political prisoners whose human rights are systematically violated. In other words, the issue as far as the mainstream media is concerned is not the US government cooperating with the Chicago police department under both the Bush and Obama administrations in securing experienced torturers and systematically violate civil rights of American citizens and human rights of foreign nationals. The issue is not that the US has become slipped toward the road of an authoritarian state that in many respects reminds us of others that the US accuses of violating human rights.

There is really no other country that one could compare the US because it does hold elections at all levels, although those elections are invariably financed by the wealthy. Even with a surveillance network under the NSA that is a glaring violation of the US Constitution, the US permits expression of cultural freedom – art, speech, religion, etc. – as much as it permits social freedom such as gay marriage, right to form social organizations as long as they do not impede what the state defines as national security. Even if the US looks to Israel as a model of how to project a “legal” face on illegal activities, one cannot argue that there is no trace of democracy in America as there was none in many totalitarian and authoritarian countries during the 1920s and 1030s in Europe.

On the other hand, there are limits to political freedoms, especially for minorities whose rights are systematically violated at an institutional level and social justice is not only the lowest priority of government, but an impediment to its quasi-police state methods. Justified in the name of national security, the government expects that collective psychopathology works for the majority of the population, and for minorities whose socioeconomic status transcends race/ethnicity. This explains why the minority elites are hardly exercised by either by civil rights or human rights violations, unless there is a monetary of political incentive behind speaking out. This also explains why the white majority remains docile and accepts the system as democratic when in fact it is practicing authoritarian and police state policies.

When I first read about the “black sites” that the Federal government is running and the Homan Square facility I thought of Argentina during the military dictatorship of 1976 to 1983. Thousands of people totally unconnected with what the Argentine Junta called “terrorism” were assassinated, tortured and disappeared never to be seen again, all in the name of law and order and security. This was a regime that US was fully supporting, until 1982 when the Falklands War resulted in British military intervention that essentially meant the end of the US-backed regime. I am not suggesting that the US in the early 21^st century is like Argentina of forty years ago, because the US has very different institutions and history. However, there are parallels because in both cases law and order, and national security were invoked.

That blatant racism and glaring human rights violations are taking place under the stewardship of the first black US president and a black attorney general clearly demonstrates that these individuals are “token” symbols of political correctness, symbols to project an image of openness in a society that is racist beneath the surface, has disdain of human rights and civil rights, of dissident voices and of democracy. The first African-American US president and a black attorney general have not done anything about Homan in Chicago devoted mostly to torturing blacks, nor have they prosecuted or stopped the torture in “black sites”. The Homan Square detention and torture center in Chicago has cost the city an estimated $64 million in payments for innocent victims suffering civil rights abuses under the watchful eye of the authorities. The Homan Center’s link to the CIA and Department of Defense, as The Guardian noted in its recent publication, are sources for alarm on the part of those who value the US Constitution and principles of democracy and social justice.

One of the most notorious torturers in both Homan and Guantanamo was Richard Zuley of the Chicago police department. I have no doubt that it takes a specific type of human being to have as a job the torture of other human beings. However, this police officer with special talents in torture techniques was approved by his superiors in Chicago and by DoD for Guantanamo. As far as he is concerned, Zuley is a law enforcement man doing his patriotic duty, which happened to be torturing blacks in Chicago and Muslims in Guantanamo. I am not trying to excuse Duley, but I would rather focus on the local and federal government authorities and the policies they are pursuing because if it were not Duley carrying out such horrendous tasks it would be someone else like him. Responsibility in this case is not with Duley but with the Mayor’s office in Chicago and with Washington D.C.

This is a case of the American police forces becoming increasingly militaristic in their tactics, treating suspects of color as enemies of the state to be shot down in cold blood without any questions asked by policymakers. The sharp rise in police shootings of blacks and Hispanics, along with the revelations of torture at Homan, and the link to Chicago police torturers the DoD used in Guantanamo proves beyond any doubt the existence of an institutional structure that bypasses the laws of the land and violates the Constitution. Using Israel’s legalistic tactics to bypass US laws hardly speaks well for the US.

The recent revelations of Guantanamo prisoner Mahamedou Ould Slahi, a former German resident from Mauritania, have shocked those around the world who still believe that the US is a democratic nation of laws respecting its own Constitution and the UN convention on human rights. Although the Mauritanian Muslim has never been charged, there is no shred of evidence to link him with any fanatic Islamic organization as far as the US has been able to disclose, he was tortured, and never charged. Yet, the Obama administration has blocked all efforts to have this individual either charged with a crime or released. The only thing the Department of Justice has done is to obstruct legal efforts to have this Mauritanian released precisely because his release will mean even more political damage to the US. Just as with the case of Mahamedou, the minorities housed in the Homan “black site” do not really exist, they cannot be found in any official database, they cannot see a lawyer, they are not charged with any crime, but they are detained, and some tortured to confess anything the police want.

It is easy to blame to blame Zuley, his immediate supervisors, the Chicago police department, the men and women working for CIA and DoD, but never go beyond the level of the operatives and their supervisors. While I am not suggesting that these operatives have any moral fiber and human values, responsibility ultimately rests with government policy that shapes the culture of authoritarianism rooted in racism against blacks and Muslims, and the collective psychopathology that permits people to accept the police state. The question is who is next after blacks and Muslims? There were debates between Jeffersonians influenced by Rousseau who subordinated individual rights to the “General Will”, and the more classical Liberal followers of John Locke who placed individual rights above all else. This is the debate that Supreme Court Justice Luis Brandeis picked up and reflected the Progressive movement of his times that found expression in both political parties.

If there is a Constitutional basis for human rights and privacy rights, the government violating such rights can only resort to the old argument of “national security”. Brandeis issued a dissenting opinion on the privacy matter, stating that: “Government was identified as a potential privacy invader….the makers of our Constitution conferred against the government, the right to be let alone—the most comprehensive of rights and the right most valued by civilized men.” The Brandeis dissenting opinion was a warning about a government violating the human rights of citizens when it violated their privacy rights. The issue was then was government spying on its own citizens as it does today under a SURVEILANCE REGIME. The Supreme Court today would not side with Brandeis on this issue, because the Justice Department will argue that the “war on terror” takes precedence over the natural, human and civil rights of citizens.

It is ironic that the US government strongly condemns human rights abuses wherever they occur around the world. It is ironic that the US government speaks out for freedom and democracy, and for tolerance of dissident voices in other countries. It is ironic that the US government sides with minority voices where they are repressed and projects an image of siding with the oppressed around the world. The only problem here is that the US government is guilty of every single violation it accuses its enemies. Yet, it invokes the doctrine of “American Exceptionalism”, which means that the level of hypocrisy remains very high and the US has no moral or political authority to speak on any of the issues stated above unless it first starts to practice what it preaches and stops violating its own Constitution.

Slowly degenerating into a police state with authoritarian tendencies reminiscent of dictatorships that the US has supported around the world in the name of national security will backfire at some point. The time will come when the American people will begin to question the “collective psychopathology” and the culture of fear intended to keep the public docile and supportive of military solutions abroad and police state methods at home. The time will come when the institutional racists structure currently against blacks and Muslims as the main target groups will expand to include white middle class dissidents, as was the case in 2012 in Chicago with NATO protesters detained at Homan Square.

The time will come when the mask of democracy will slowly drop and the naked face of raw aggression will manifest itself. The time will be during the next cyclical recession when the only way the government will be able to justify transferring income from the lower and middle class to the elites is by peddling culture of fear and collective psychopathology.

I have often argued that there are no utopian societies, except in philosophy books and novels. One could argue that violating human rights and civil rights, ignoring the Constitution and overlooking laws is “Pragmatic Democracy” because of overriding national security issues. The NSA and other agencies spy on American citizens in violation of the Constitution, as a former CIA chief has readily admitted, because it is necessary for “national security”, as the government defines it, meaning no limits. If the American people have no problem with their government violating human rights, for practical considerations that national security justifies, then that is part of the collective psychopathology that prevails.

But what if the American people have no clue of the depth and breadth of US government violations of the Constitution and the law because there is no public disclosure? Is failure to inform the citizenry “pragmatic democracy” as well? Does “pragmatic democracy” have any Constitutional or legal limits at all, from torture of its own citizens to political prisoners, from denying due process to its own citizens to ignoring the UN convention on Human Rights?  If this kind of democracy is above the Constitution and ignores the basic rights of its own citizens, when do we stop calling it democracy and start calling it what it really is?

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The “American dream” in a pill

February 24th, 2015

 

By Jon Kofas.

 



 

MIRACLE CURE or POLICY CHANGE FOR THE SHRINKING MIDDLE CLASS?           

Did you know that the American Dream now comes in the form of a miracle pill? A recent marketing and advertising trend is peddling what they call the “smart pill”, presumably a brain pill that not only makes you smart, it can also make you rich because you optimize your brain capacity! This is essentially a vitamin supplement that claims to boost memory, energy, and creativity, but it can also make you rich, very rich because it allows you to use your head more effectively when making those difficult career and investment decisions. You too can realize the “American Dream” just by taking this pill, without going to college, without working hard, without any effort on your part.

Pills and potions have been sold for their “miraculous” powers for centuries, but especially in the last fifty years amid a culture of “therapism”, a trend that assumes the more pills the patient takes the better for treating everything from serious illnesses to shy demeanor in public places. Although I never thought that I would actually see a vitamin supplement peddled as the cure to low IQ, I am even more surprised that the so-called “brain pill” today is promoted by movie stars as having them smarter but also millionaires. If you too wish to become a rich and famous person take the “smart pill” and all your troubles will be behind you. One could understand a pill that makes shy people less so in public. However, a glass of fine red California wine would probably work even better and with tangible benefits for the cardiovascular system.

Considering that roughly ten percent of Americans take anti-depressants, it is understandable that despair has driven people to blame themselves. This is not to dismiss the validity of medication when necessary and when prescribed with diligence to save lives and relive pain. Nor is this a critique of the “smart pill” as an enhancement drug that may work to energize the brain, again with the caveat of long term side effects. But is the “smart pill” a catalyst for the fate of Bill Gates, movie star Bradley Cooper, etc. and is it a catalyst for addressing low income conditions in society? Let us assume that the manufacturer of the pill were to distribute it free to the entire population in the world under the auspices of the World Health Organization. Would this end poverty in sub-Sahara Africa, uplift indebted Americans straight into the rich and famous category?

As though the “smart pill” were not enough what about a motivational speaker going on TV and arguing that the middle class is shrinking so please get out of the middle class now. How does one extricate herself/himself from the dwindling middle class and rise up to the millionaires club to keep company with Hollywood stars and high tech billionaires? The highly paid motivational speaker replies that you just have to triple your income because America is rapidly becoming the land of rich and poor and you want to join the rich folks. How do you triple your income if you are a) a retiree on fixed income; b) a college student; c) a college graduate in fine arts working at COSCO until that great museum curator job opens up; d) an office worker trying to hang on to your job for another year with an income you need because you husband is working part time; etc. Short of some stroke of luck or illegal activities, you will experience a downward socioeconomic mobility and so will your children in the next three decades because that has been the trend in the last three decades.

Not to put a damper on the miracle “brain pill” or on the highly paid motivational speaker, but back in the “real world” of the middle class chasing the elusive American Dream, people endure income inequality that government policies have created because they are meant to concentrate wealth. Notwithstanding, the “smart pill” theory and the motivational speaker who has lifted himself/herself out of the middle class by giving you advice at high cost, the assumptions about why and how one is poor and how one becomes rich are as old as the first Industrial Revolution in England.

Once the Industrial Revolution began to spread from England to the continent in post-Napoleonic Europe, scholars, politicians, and businessmen recognized that capitalism creates immense wealth but at the same time enormous poverty, despite the theoretical promise of “general wealth” for all as classical economist Adam Smith argued. The response from the political, business and academic elites in the early 19^th century was that the system is fine, in fact “natural” to mankind. If you are not wealthy it is your own fault because you have negative traits such as laziness, alcoholism, bad behavior etc., you are ignorant because you lack an education, ambition, hard work, and skill/talent. It is important to point out that in pre-unionized workplaces, a worker labored for 16 hours a day six days a week and earned a subsistence wage barely enough to feed a family. Was he poor because of the subsistence wage policy that both business and government demanded must prevail, or because he lacked those fine character traits that are after all determined by the environment in any case, as English philosopher John Locke pointed out in An Essay Concerning Human Understanding?

A recent study on the continued shrinking of the American middle class points to some very troubling statistics, among them that the downward socioeconomic mobilization that started in the early 1980s and will probably continue for the balance of the decade. What is the middle class and how does our definition differ from that of 19^th century Europe undergoing social change because of Industrial capitalism? US government, the media and mainstream institutions define middle class on the basis of a) owning a home, b) car, c) college for the kids, d) retirement fund, e) health care, and f) family vacations. If you have these six things, you too are in the shrinking “middle class” as US government (and mainstream institutions) defines it. But what if you lack one or more of the six criteria and what if your income continues to drop in real terms because cost of living is rising?

Although Americans like their European counterparts became two-income families, some taking second jobs in the last three decades, the cost of living has been rising, while wages, salaries, benefits, and social security income could not keep pace. Income distribution is such in the US that no study see an improvement, while all studies point to Asia and parts of Latin America experiencing a rise in their middle classes. By the middle of the 21^st century, the BRICS nations – Brazil, India, Russia, China and South Africa – will have more than half of the world’s middle class while the US will continue to experience downward socioeconomic mobility in the absence of a major shift in the fiscal system, labor and social policies that will redirect income from the top 10 percent of the population to the bottom 90 percent. While the BRICS combined have the majority of the world’s poor today, the economic power shift from the US and EU will mean that the BRICS will account for most of the world’s expanding middle class by the end of this century. This does not mean that the American middle class will disappear any more than the European middle class disappeared after the Great Depression and World War II.

The issue of the shrinking middle class is not just about how the economy will become increasingly distorted because consumption power will be decreasing. Nor is the dwindling middle class about the distortions this would cause in the tax system that would have to change. As middle class incomes stagnate, this sector of society will be making lower contributions to fund government spending in everything from defense to social security. This may entail higher indirect taxes that falls disproportionately on the mass consumer.

The issue of course is not only about the withering middle class but the survival of democracy, at least as democracy as the two political parties have been promising the American people, if not as Thomas Jefferson saw it. Will American democracy slowly lapse into some kind of a semi-authoritarian system that will continue to call itself democracy in name, and it this future prospect already here? I have argued in a number of articles that quasi-police-military state is already here and democracy only means the right to vote for pre-chosen candidates representing basically the same policies furthering the interests of the upper income group.

America is facing 76% of the middle class subsisting from paycheck to paycheck and the average person is carrying $84,000 debt or double of what it was thirty years ago. This would not be the case of the top one percent of the wealthiest Americans were not earning 300 times more than the median household income that dropped from $73,000 in 1983 to $57,000 in 2010. For income inequality to stay at pre-1980s level median household income would have to be double its current level. The corresponding thirty-year period when median household incomes dropped, the top 1% of Americans saw their personal wealth almost double from $9.6 million in 1983 to $16.4 million in 2010. That 60% of American households earn less than 50% of the gross income, roughly 30% have zero savings, and another 43% have enough savings for three months is a reflection of a society with very serious socioeconomic problems. It is one thing for EU debtor nations under austerity from Greece to Portugal having a third of their population on the edge of poverty and entirely another when 37% of Americans have credit card debt that equals or exceeds their emergency savings.

Policymakers have been proposing all kinds of solutions ranging from strengthening the corporate sector even more at the expense of labor. Defense spending that takes away from civilian economy combined with a fiscal policy of transferring wealth from the middle and lower classes to the top ten percent is the reason for the erosion of the middle class. Under Keynesian policies from the Great Depression until Johnson’s Great Society the American middle class expanded. It began to contract as the Keynesian system eroded owing to government decisions to keep the military industrial complex strong and keep a strong corporate welfare system that maintains an elite financial class increasingly wealthy at the expense of the middle class.

The Obama administration remains concerned that the American Dream is fading because the middle class is weakening. Arguing that the “middle class dream” (synonymous with the American Dream) is fading fast, the Obama administration has a task force operating on the assumption that “everyone wants to and can be in the middle class.” Will the “smart pill” and motivational speakers, secular or religious, help society with the many complex problems in the future? Is income redistribution the answer? The only acceptable solution for US government and mainstream institutions is: a) find another job to supplement your income, b) work harder, c) plan and invest better, d) return to school for more education or re-training; and e) wait for “lady luck” to ring your doorbell because you have conformed to the Calvinist work ethic! If indeed the assumptions of the US government (and the entire mainstream institutional structure) that “securing a middle class” is the key the American Dream, how do we explain US public opinion polls indicating that the “happiness” level (granted the obvious difficult of quantifying it), has been under 50% and steadily declining since the late 1970s?

Even if we accept the US (political and financial elites backed by media, and private consultants) ubiquitous PR campaign, to project the image that upward mobility is the dream achievable under capitalism under the current neo-liberal model, scholarly studies by individual academics and think tanks for the last three decades indicate that there has been downward mobility in America, spreading to Europe. Global outsourcing under neo-liberal policies has resulted in a shrinking middle class likely to shrink more in this decade in the US and EU.

In March 2009, I issued a posting on Stanford University’s World Association for International Studies entitled“Twilight of the Middle Class” where I argued that the middle class in most of the world has been created on paper owing to the credit economy. When I presented the same point in spring 2010 as a guest speaker at a Greek university conference dealing with issues of international political economy and IMF austerity, no one in the audience was surprised that indeed the middle class was built on a mountain of debt under an unsustainable global (public and private) credit economic structure designed to keep wealth concentrated. People know where they stand versus the image they project, a dream that the political and financial are projecting while constantly working to make the social pyramid even narrower.

The larger question today is should the six-point criteria developed by individuals who want to perpetuate consumerism be the basis of the American Dream, or should there be a re-examination of peoples’ values in the wake of this prolonged global recession and I mean all people, not just the middle class that constitutes the popular base of bourgeois political parties? Are these the values America wants to continue exporting to the rest of the world so it can strengthen finance capitalism at the expense socioeconomic chasm and social polarization from which arise extreme right wing elements? Is the essence of humanity predicated on the six points mentioned above?

In the US government report, there was no mention of creativity, no mention of empathy in thought and deed for one’s fellow man, no mention of protection of nature, no mention of philosophical/spiritual self-reflection, no mention of greater social equality or collectivist action that alleviates suffering of the vast majority, no mention for lessening societal and institutional violence. America is becoming more polarized, and Europe is following in its footsteps. At 4% of the world population, the US consumes roughly one-quarter of the world’s resources. However, a mere 1% of the population owns 35% of the wealth. Is there a future for a growing middle class, the realization of the American Dream and the avoidance of sociopolitical polarization under such wealth concentration?

Conclusions

It is really the epitome of absurdity that the mass media promotes “miracle cures” while at the same time it rarely focuses on the hypocrisy of the inexorable relationship between the political and financial elites. In a report about the relationship between campaign contributions and fiscal policy favoring the very rich, it became public thatIllinois Republican Governor Bruce Rauner has proposed slashing programs for the middle class and the poor, while he personally – as one of the richest men in ILL – and the state’s top income earners benefit from his fiscal policy that essentially redistributes wealth from the lower and middle income groups to the rich. It turns out that Illinois millionaires have made millions of dollars in cotributions to the governor’s campaign. In turn, Rauner will use the millions of his contributors to run ads against his opponents who question fiscal policy redistributing wealth from the lower and middle class to the rich. No miracle pill for Rauner and his millionaire contributors and no motivational speakers, just the color of money.

There cannot possibly be middle class growth in the absence of raising living standards of the working class by raising the minimum wage and offering more benefits, especially health insurance. Only government policy from fiscal measures to a pro-middle class and pro-labor regime can reverse the current course where wealth will become so concentrated that it will cause an even deeper and longer recession during the next cycle that I would argue is coming in the 2030s, one century after the Great Depression. This is not inevitable, if the US as well as the governments of the world’s strongest economies do something about grossly uneven income distribution. In the absence of such a policy reversal that only favors the very rich the capitalist system will suffer a serious blow even more devastating than in the 1930s.

Of course, in desperation, people could continue paying money to motivational speakers and try to become rich turning over real estate, day trade on the stock exchange, or speculating on commodities and gold. There is also the magic pill that accounts for movie stars and billionaires, although the side effects of the pill are not known because not enough studies have been done on this. There is also prayer to your local church or temple so you can have a different fate. While all of the above may solve your individual problem, at least make you feel better that you tried, the continued decline of the middle class will remain a reality as will the political and social instability that will invite among the general population that is increasingly outside of the mainstream.

We live in a world of solutions that come in the form of a pill, or in a speech by some celebrity speaker who claims that magically you too can be transformed into another person, or in a minister of the church who asks that we keep the faith in God who loves all His creations, and after all the rich are not happier than the poor who will inherit the Kingdom of God. As if this were not enough, we have the politicians promising the moon to all only to deliver it to the privileged elites, and the commercial media essentially echoing whatever the politicians, businesspeople, pill pushers, motivational charlatans and others are peddling to line their pockets while the middle class dwindles and the working class becomes poorer. Change for such a world will not come in a pill bottle, from a charlatan’s speech or from the Heavens. Grassroots problems can only be solved through grassroots solutions. The 21^st century is not about “Messiah politics”, but about small practical steps that will eventually lead toward a larger solution if enough people are involved in determining their own fate.

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Who is destabilizing the EU? Greece or Germany?

February 21st, 2015

 

 

 

By Jon Kofas.

 



Does Greece with just 2% of EU GDP have the ability to destabilize the EU simply by refusing the IMF-EU imposed austerity program, or does Germany have such power because it has been trying to impose its economic hegemony over the rest of Europe?  

On 19 February 2015, German Finance Minister Wolfgang Schaeuble rejected a Greek compromise proposal for a Greek “bridge loan” that would essentially buy six-month time for the new SYRIZA government in Athens to restructure the fiscal system and stabilize the government’s finances while meeting domestic needs.

Rejecting the proposal from Athens, a proposal that most of the EU members are willing to support, Germany demanded that the new  SYRIZA (center-left) government of Greece continue with IMF-EU austerity as previous (neo-liberal oriented) governments had agreed in the past five years. Of course, austerity has resulted in a drop in GDP of 25%, drop in one-third of incomes (wages, benefits and social security) for about two-thirds of the population, unemployment of 26% and a mass exodus for college educated people, while leaving the public health care system in shambles because money was transferred from health care to paying interest on debt.

At the same time, debt-to-GDP ratio rose from 110% before austerity to 175% in 2015. The strongest argument against austerity is that every single promise the IMFand Germany made about its results – economic development, lower unemployment, lower debt-to-GDP ratio, healthier government revenues – turned out to be entirely false.

For its part, Germany insists that Greece is trying to negotiate an extension of euro zone funding with no strings attached and it must abide by all neo-liberal policies previous governments agreed to implement, regardless of the cost to the middle class and workers, to health care and education, as long as the defense sector stays untouched because Germany exports weapons, submarines, etc to Greece.

Meanwhile, Athens promises to meet its debt obligations as long as it has better terms and no interference in domestic policies. This means no interference in the country’s institutions impacting everything from health care and education to the fiscal system and privatization of public assets that Germany wants sold for pennies on the euro to billionaires waiting for the fire sale. Ruling out any compromise, Schaeuble argued that: “Our room for maneuver is limited. We must keep in mind that we have a huge responsibility to keep Europe stable.”

The German finance minister clearly presents his government as the guarantor of EU stability and Greece as the catalyst for instability. The EU’s largest creditor nation, Germany is the victim of the EU’s largest debtor nation, Greece, so Berlin must protect the integrity of the EU as far as Schaeuble is concerned. The question is whether this is the case, or is the German finance minister demonizing the weak debtor nation, buying time and forcing it to make even more compromises so that the failed IMF-German-imposed program prevails in Greece. This would then send a message to all of the EU that Germany is hegemonic and its austerity and neo-liberal policies will prevail over the periphery members in the EU that Germany has reduced into quasi-colonies, as the Greek prime minister implied in a recent speech before Parliament.

Germany has a long history of trying to impose its hegemony over Europe, going to war when Prussia led the unification of the Germanic states in 1870. Germany went to war again in1914 in a blatant attempt to secure more colonies, semi-colonies and spheres of influence, and global markets. In 1939, Hitler, following the long-standing German tradition of hegemony went to war against the rest of Europe, putting an end to the strategy of war as a way of securing the goal of hegemony. In the second half of the 20^th century, Germany turned to the concept of European economic integration to accomplish the goal of hegemony where war had failed in 1914 and 1939.    

One of Germany’s best historians of the 20th century, Fritz Fischer, argued in his works dealing with the German Empire that the goal of Prussian (Junker aristocracy)-led regime from 1870 to 1914 was to be a world power, otherwise the alternative was decline. (See Fischer’s Weltmacht oder Niedergang: Deutschland im ersten Weltkrieg, 1965)

The concept of global power status is deeply ingrained in German culture and today it manifests itself in the patron-client integration model that Angela Merkel has been pursuing in order to achieve the goal, while at the same time enjoying the support of German banks and corporations, many of which the government is itself a stockholder. In other words, German contemporary foreign financial and economic policy as practiced through the mechanisms of the European Union have a historical basis, and reflect the “Fischer Thesis” of World Power or Decline!

One could argue that just because Germany was founded as a nation by going to war against neighboring France in 1870, that does not mean Germany in early 21st century is militaristic like old Prussia. The same argument could then made about Germany’s quest for hegemony in 1914, and again in 1939. In this case, let us wipe out the memory of the holocaust, Jews, gypsies, Communists, among other war crimes, including those that the Third Reich committed throughout the Balkans, including Greece. Let us simply accept that Germany in the early 21st century is not militarist and it is not pursuing political hegemony at the expense of its neighbors, having learned bitter lessons from history. Can we possibly make the same argument about German economic hegemony ambitions?

The obstacle for Germany is not Greece and the periphery nations in the EU that are powerless to determine what happens to the monetary bloc. After all, Greece like all of the periphery EU members have always been dependencies of the core countries. From its creation as an independent nation in 1832 until the present Greece was always a debtor nation and always a dependency of Great Britain from 1832 until the Truman Doctrine, and then on the US from 1947 until the 1970s when it took a turn toward much greater European integration and depndence. 

Germany’s problem today is actually the core EU members, especially the UK that wishes to redefine its relationship with the EU, and the US that wants a balance of power in Europe with a modicum of containment imposed on Germany through the EU and NATO. At the same time, there is the reliance of Germany on Russian energy that makes it vulnerable and the global competition from China that is investing hundreds of billions in Europe, thus investing in market share at Germany’s expense. Greece is small, symbolic, and a political issue that reflects Germany’s larger problems in its quest for global status.

The issue for Germany is to inject sufficient fear into the rest of Europeans about any nation deviating from German policy dictates so that they follow faithfully as they have in the past. Greece is only the example Germany is using to accomplish its goal, because Greece has only “negative political and economic leverage” while Germany has positive leverage. In short, Greece, like all debtor nations in our modern times can threaten suspension of payments thus causing instability among private and public bondholders who would rather secure a deal securing some return on investment than no return.

The massive transfer of wealth from Greece to Germany in the last five years of austerity has resulted in several billion euro profits for German banks. True, German taxpayers have provided loans to Greece used to repay German and other EU creditors, but the money never goes to Athens, but directly to the banks including European Central Bank that has also made huge profits from Greek bonds.

In other words, in the short term European taxpayers are making loans to Greece to pay the EU banks, while Greece will be saddled with debt for the next 80 years. This kind of negative leverage actually destabilizes markets because large institutional investors fear not making as much money as they hoped. Of course, there is one other type of negative leverage Greece enjoys that really angers Germans, even if they do not support their government’s tough policy. The left-center SYRIZA government has repeatdly asked Berlin to open negotiations for war crimes and several billion – anywhere from 30 to 150 billion euro – that Germany owes Greece. Berlin insists it will not discuss war crimes and damages owed to Greece.

On the other hand, there is the positive leverage that Germany exercises as the hegemonic creditor nation. In order to secure austerity that keeps the currency strong at the expense of debtor nations whose economies are weak and become even more dependent on the creditors, Germany and by extension the EU is refusing liquidity to the debtor nation. The threat of Germany immediately throws off the bond and stock markets, because it means that the absence of agreement with the debtor will mean financial and economic turmoil.

Germany’s positive leverage stems from its massive economic power within the EU and clearly as the dominant country it has the ability to stabilize or destabilize as it wishes. At the same time, Germany feels the pressure from the US and China, pressure it resents as we have seen over the disagreements on the Russia-Ukraine crisis. In its quest for global power status, Germany wants a freer hand in the EU that it considers its back yard, just like the US considers the Caribbean and Central America its back yard.

With France politically and economically weak, the major obstacle to Germany is the persistence of anti-EU sentiment coming out of the UK. It is possible that the UK will have an even larger economy than Germany at some point before 2024, and this is something that Germans take into account when they position themselves for hegemony today. In short, the German-UK power struggle is important today, though hardly fierce enough for these two economic rivals to go to war as they did in 1914.

German power means the power to stabilize or destabilize the entire euro zone. Greek weakness means that it must use every other power from China and Russia to the US in order to counterbalance Germany’s pressures. Berlin resents that the UK and US, as well as China and Russia want a European balance of power with a Germany that is weaker than it is. Not too long ago, a US government official noted that the German trade surplus is a destabilizing factor in the EU and it comes at the expense of the other members.

This kind of thinking prevails among the other great powers in the world, and it is something that Germany is trying to surpass when it adopts a harsh negotiating posture toward Greece. Unlike many analysts who insist that the issue is a culture clash, a difference between a northern European vs. a southern European country, I believe that those are marginal issues and at the core rests German strategy for hegemony and Greek insistence at preserving a modicum of national integrity and sovereignty.

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Alan Greenspan, Greece, and the Media

February 10th, 2015

 

By Jon Kofas.

 



From 2010 until the present, I have been writing that Greece will not leave the euro zone. This is not because the Greek economy of about 180 billion euro or 2% of EU GDP has had such a great experience in the EU, but because Germany as well as most of the European governments, and especially banks know that the cost of Greece leaving to the EU economy will be detrimental for all of Europe.

The devastation could potentially hit the stock markets from 15 to 25% and impact the entire world economy with the euro sliding sharply as a reserve currency and imports coming to Europe dropping thus world GDP droping along with it. The psychological impact will be so severe and the psychology of fear and uncertainty that drives markets so shocking immediately after Greece exist that analysts and politicians will be asking if Spain is next, and if the EU itself can survive. In short, this is the worst possible scenario for the EU and its political leaders and financial elites know it very well. Moreover, the US knows it and is pressuring Germany not to push Greece out of the euro.

Despite this reality well known to those in political and financial circles in Europe, US,  and China which has a big stake in the Greek ports, there are well-paid spokespeople who try to influence the currency market, the bond market and the stock market by making statements without fully disclosing their employer who paid them to influence the political and business climate. I have written in the past five years that noble prize economists, former US officials acting as private consultants for financial firms, as well as “celebrity economists” on the payroll of hedge fund companies have failed to disclose their sources of income when they present their views on the euro as a reserve currency, the EU stock market and the bond market.     

On 1 February 2014, Alan Greenspan argued in a BBC program that Greece will eventually leave the euro. Fair enough because Greenspan is able to see Greece’s future better than the rest of the world and has every right to share his indispensable wisdom with the innocent public.

However, all news organizations around the world presented the story as one coming from the analytical mind of the former FED chairman, not the Greenspan on the payroll of companies that make money shorting currencies and/or bonds.It is one thing to have a former government official clearly disclosing his/her business links and conflict of interest up front, and entirely different to have no disclosure and project the impression that the “analysis and opinion” are “objective” and not motivated by self-interest.

There is nothing wrong with a person trying to make money by presenting a point of view in major media outlets. On the contrary, every expert has the obligation to offer a viewpoint. However, knowing that such opinions at crucial junctures of sensitive public debt negotiations mold the markets and political climate by creating a negative or positive psychology for investors and the public in general is unethical to say the very least.

Is former FED chair Greenspan speaking about Greece because: a. he really cares about what happens to this tiny Balkan country with a GDP three times lower than APPLE Computer’s worth; b. he is idealistic and wishes to share his wisdom with the world in order to enlighten an otherwise ignorant public; c. he was a paid consultant by financial firms, including PIMCO with a history of shorting Greek bonds? The question the media must ask when running the Greenspan story as “news” is whether he is making statements that influence the bond and currency markets as a former FED chair or as a paid consultant?

It is true that Greenspan was never enthusiastic about the euro, and it is true that he has not changed positions, paid consultant or not. The reason PIMCO hired him as a sonsultant is precisely because of his position on stocks, bonds, and the euro. However, the core issue here is about full disclosure and about how news is manipulated by private business consultants to create a political and business climate that impacts not just an entire country, but an entire continent and perhaps the entire world. Greenspan is 88 years of age, and he hardly needs the money. This raises the question that if it is not money, then is it ideological conviction, three minutes of fame he hardly needs, just be be heard again as influential now that he is old. Putting his motives aside, what about the ethical and professional responsibility of the mass media in transmitting such a story?

It is indeed tragic that news organizations do not scrutinize their guests’ comments by asking for full disclosure. Greenspan is hardly the exception, but rather the rule to what takes place. This tells us a great deal of how media is nothing more than a tool that shapes public opinion, political climate and business climate. One must really wonder why on the day that the massive HSBC money laundering was revealed did Greenspan choose to deliver a prophetic statement about Greece, knowing the highly sensitive negotiations between Athens and the EU in the next few days?

Why not comment about the massive $100 billion money laundering scandal involving one of the world’s largest European-based bank (HSBC), a bank that has been laundering money for everyone from drug lords to dictators and to all types of shady characters some ? As a former banker Greenspan ought to have an opinion about how commercial banks are used for tax evasion and money laundering. Now is that not more appropriate than commenting about a tiny country like Greece that many Western analysts insist will make no difference whether it stays or leaves the euro?

When all politicians, business people, journalists, and analysts provide their opinions on the air, web, or in print, they agree that Greece with less than 2% of EU’s GDP makes absolutely no difference to the European economy. Therefore, the Greek government can make whatever decision it wishes, and it would have no impact on the EU economy. So goes the argument not just on the part of Merkel’s government, but all molders of public opinion outside of Greece.

Now for a reality check. If we follow not just the European stock exchanges, but Wall Street as well as the course of the euro, we discover that the markets are actually following everything that takes place in the Greek political arena. In other words, if Greece remains firm on the issue of ending austerity and debt renegotiation to reduce the nominal value, the markets fall across the Western World. If the Greek government appears flexible on partial austerity then market rise accordingly. Why is this taking place, given that Greece is not essential to the EU economy? And how do we explain the analysis by politicians, journalists, economists and other paid consultants who argue that there is absolutely no relationship of Greece to the rest of the EU because the former’s economy is so tiny. 

The Greenspan story and the spin by those who argue that Greece has no impact on the EU and provide us with clear evidence of how the so-called free markets are manipulated by those who manufacture business news to create an investment psychology. In my view, Greece will not leave the EU for reasons I have stated in so many different articles in the last five years. When I lived in Greece, I advised my friends and relatives not to take their money out of the bank. Just because well paid consultants, like Nouriel Roubini among others working for financial firms, are shorting the euro and the bonds of across Southern Europe this does not mean that people must play along. 

Greece and all EU periphery members would be better off in the long term if they enjoyed monetary sovereignty. However, I remain firmly convinced that Greece will stay in the euro zone, unless of course it is so utterly significant for Germany and the European banks to make an example of Greece so that Spain does not follow in its footsteps opposing austerity and neo-liberal policies. I do not see such scenario, partly because Obama is also against austerity without development.

At the same time, Chancellor Angela Merkel is consumed by fear of having all of Europe blaming her for weakening if not dissolving the EU in case a compromise with Greece fails. Germany and the Western EU banks have been using the public debt of the periphery EU countries as leverage to impose neoliberal policies and maintain their economic dependence on the core countries of northwest Europe. Why would they want to slaughter these cows that have been providing and will be providing milk for decades to come?

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Americas Counter-Terrorism Culture

February 9th, 2015

 

 

By Jon Kofas.

 


The core issue of my article was really very simple: Can a society with counterterrorism as a core political and cultural value widely practiced be democratic, given that counterterrorism necessarily leads toward undemocratic practices at home and abroad? Moreover, even if we accept counterterrorism as a necessary evil, has it been effective inn the last 15 years? Studies show that terrorism has been rising not declining, while the political and economic costs to society have been immense.

Is America a model democracy, the epitome of an pluralistic and open society, the example for the rest of the world to emulate, or is it a paranoid society in search of enemies that the US government must create in order to preserve the anachronistic political, social and economic status quo against the tide of history? If you lived in the US during the first fifteen years of the 21^st century, you probably noticed that government at all levels, the mass media, businesses and churches are all concerned about terrorism to the degree that this has become an obsession and national hysteria deeply imbedded in the culture. In fact, the culture of counterterrorism is so deeply imbedded in America that one finds it throughout the educational system in courses taught from elementary school to graduate school; in Christian churches and Jewish synagogues that see Islam as the source of terrorism, as though there is a “terrorism gene” in the DNA of those espousing Islam as their faith.

A pluralistic society like the US has many layers of history and culture that reflect the diversity of the various ethnic groups living here from the Native Americans and African-Americans to the Europeans, Asian and Latin Americans. One layer of contemporary American culture, a predominantly political one on top to the consumerism layer, is counterterrorism that feeds off the mass psychology of fear. Counterterrorism has become an industry in itself and a lucrative one at that because the government has been throwing billions to everyone from surveillance specialists to the common media propagandist and consultant for hire.

That counterterrorism is an integral part of the dominant culture ought to concern all citizens, even the financial and political elites that enjoy most of society’s privileges under such culture.

Does the majority of the American people really feel and living in a democracy when the counterterrorism has converted society into a police state? George W. Bush used to say that “they”, namely militant Muslims, hate our freedom. In other words, they are just jealous and all of the actions across the Islamic world are driven by jealousy for the American way of life; a way of life that is an anathema of course for the vast majority of Muslims. Bush’s comment assumes that at least the majority of Americans are really convinced they are free and that the rest of the world is not, at least Muslims are not enjoying the same precious freedoms as American Christians and Jews.

While most Americans feel that they are free to shop as a way of life, if they have money of course, do they believe that their voice makes any difference in political, social or economic affairs? No doubt, many Muslims would probably empathize with Americans on this issue. Do American citizens believe that the social contract is for them as the Founding Fathers intended, at least as Thomas Jefferson did, or has the social contract become a business one for the socioeconomic elites that exert dominant influence in the political arena at all levels and have a paternalistic attitude toward the middle class and workers? In this domain many Muslims would also empathize with Americans who feel that their government represents the elites.

Americans have as part of their ideology the “Exceptionalism” doctrine that goes back to the 19^th century. The institutionalization of counterterrorism plays right into the ideology of “American Exceptionalism” as well as the Cold War anti-Communist campaign that Truman unleashed in 1947 – Truman Doctrine. I suppose if everyone is a citizen of a quasi-police state operating in the name of safety and security then no one is a prisoner of an illiberal regime because of the collective nature of the police state methods that the state imposes on society.  In other words, Americans living under a counterterrorism regime, which necessarily requires police state measures, believe that they are “free”.

Perhaps Americans are not as free as Norwegians under a totally different model of democracy. For the most part, Americans are convinced of what their government and media tell them, namely, that their “freedom” must be restricted for their own good.  Under rigid security measures extending from illegal surveillance to drone warfare carried out in Africa and parts of the Middle East, the US is always fighting to preserve the freedom for all at home and all freedom-loving people across the world! Rhetoric aside, in the final analysis, freedom to an American in the early 21^st century means living within the very rigid confines of counterterrorism institutions. He trick is to keep the public convinced that counterterrorism is not a fad, but a way of life for a very long time. The way to achieve the goal is to make counterterrorism an integral part of the mainstream culture.

It is simply impossible to turn on the radio, TV, read a newspaper or news magazine, go to a mainstream online news outlet and not have to encounter the chronic crisis America is facing with Islamic terrorism. It is as though government and media are expecting a repeat of 9/11 on a daily basis; at least this is what they want the masses to believe when they turn on the radio or TV, or read any of the newspapers. Never mind all of the real problems in the lives of the average American, such as declining living standards because the government has clipped the social safety net in order to provide more assets to the corporate welfare system, everything from bailouts to tax relief, to tax loopholes that permit corporations and individuals to stash their money abroad and avoid paying taxes.  As long as we promote counterterrorism, who cares about the poverty rate, lack of proper funding for education, expensive health care costs, etc.

Economic and social issues affecting the working class and middle are not an issue worthy of discussion for mass media or the two political parties that represent the financial elites, whereas terrorism and an imminent Muslim threat, lately combined with a revived Russian one, are significant. After all, terrorism and the Russians assisting the Russian-speaking minority in Ukraine poses a threat to US national security, thus to the life of the car transmission worker in Indiana, to the retired grandmother in Omaha, to the college student who cannot afford tuition or housing in New York city. Social and economic problems are not at issue, but the Islamic terrorists, many of which the US and its allies helped create in the last thirty years, those are real threats. What about economic and social news affecting the ordinary citizen? The media deals with corporate business news and with the lives of celebrities, and that ought to be sufficient. Believe it or not, this works because people internalize external problems, blaming themselves because they are not billionaires or movie stars.

Never mind that the reality of upward socioeconomic mobility looks increasingly bleak because the top one percent of Americans own half of the wealth and the only support for government spending is in the parasitic defense sector and tax breaks to the rich and corporations that contribute to the rising public debt and result in massive transfer of wealth from the lower classes to the financial elites. This is not an issue worthy of discussion because there are terrorists running loose in Iraq and Syria, terrorists that the US and its regional allies were assisting just two years ago.

The police must rule out terrorism, as though it is the first suspect in any routine fire in a train station in New York, Washington or any major city. The same assumption holds true for the typical psychologically disturbed gun enthusiast who opens fire on a crowd of people. There is something very curious about a society where authorities find it necessary to rule out the “terrorism theory” first even on the most obvious and routine cases of homicide, arson, and other crimes that never required such an ideological filter 20 years ago.  Unique in American society, the counterterrorism theme finds expression in books, magazines, video games, movies, TV shows, and even toys. This theme is so pervasive in the political mainstream and socio-cultural milieu that the unsuspecting citizens assumes terrorists are waiting just around the corner to deliver harm to innocent Americans because they are evil and hate America. Is it safe to take the subway in Washington DC or New York without assuming a terrorist may have placed a bomb under your seat?

The institutionalization of counterterrorism is not simply in the domain of foreign intelligence gathering and domestic security, but in every sector of society from media and education, to social organizations and culture. Practically all government agencies are part of the counterterrorism prism. Not just Homeland Security, the FBI, NSA, and the CIA, but every single federal and local law enforcement agency has counterterrorism as a theme around which its activities revolve.  Everything from Airport Security to the Social Security, from the Department of Energy to banking regulatory agencies is focused on anti-terrorism. Counterterrorism people are also in all media outlets to “advise” on how to present domestic and international news stories. For example, the Russian-speaking minority in eastern Ukraine is made up of “terrorists”, as are the Palestinians, as are the tribes fighting against the US-EU imposed regime in Libya, as are the rebels in Colombia, etc.

The mainstream media has no other focus than terrorism as the core of its message. Not just FOX and CNN, but all mainstream news outlets focus on this theme as though there is nothing else taking place in the US or the world. The American people are bombarded by counterterrorism “news and analysis” 24 hours a day seven days a week, and if that is not enough, there are the motion pictures and TV shows. I am amazed that living under such a culture of mass-media-manufactured fear and hysteria about terrorism that people can still trust anyone including their loved ones. There is something seriously wrong with a society’s sense of balance when the mass media presents even the weather report from a “crisis” perspective as though people can actually do something about nature that is presented as “enemy force”. What is a person to think when even national holidays become “crisis management” affairs, when the symbol of American democracy, the White House today in comparison with the 1970s resembles a military/police fort?

When I walk into Pentagon City Mall and see all of those people shopping, I wonder how many of them are making a living as a result of the terrorism industry that the US has created. I wonder how many of them are thinking that they are safe and secure because the US government together with the media and business has created a culture of counterterrorism and institutionalized it as a way of life. If they really believe it, then government and media have succeeded in mass indoctrination. Do they even think about terrorism as an issue as they window-shop from one store to the other? I wonder if the counterterrorism regime and culture never existed, would the Pentagon City Mall shoppers think differently about the social contract and about their role as citizens toward the state.

Is a “Muslim terrorist” more likely to be a threat to Pentagon City Mall shoppers, or a psychologically unbalanced ordinary American indoctrinated in the counterterrorism ideology, believing that guns are the simple solution to complex problems that befall the individual and society collectively? Ironically, the counterterrorism culture feeds the aggression proclivities in individuals while suppressing the rational and creative tendencies that cannot survive the weight of an institutional structure demanding conformity and not questioning. We are now at a point where glorification of counterterrorism pays, while criticizing it is tantamount to treason.

The American Sniper motion picture that glorifies a soldier shooting Iraqis, including children, is a reflection of American values today molded by the counterterrorism culture. The real American sniper claimed to have killed 255 people. He bragged that he loved it because killing was fun, just another recreational activity no different than hunting deer. US Navy Seal Chris Kyle wrote “I hate the damn savages. I couldn’t give a flying fuck about the Iraqis.” When Obama recently tried to lessen the anti-Islam bias by noting Christians killed Muslims in the name of God during the Crusades, the conservatives and many media outlets insisted there is no moral equivalence, and the president has no right to insult Christians in such manner. The US media simply assumes that the Western Judeo-Christian culture is free of war crimes, when in fact during the last five centuries Christians have killed the overwhelming majority of people on this planet, beginning with the trans-Atlantic slave trade to the Jewish Holocaust.

The missionary aspect and ideological inspiration of America’s “war on terror” is itself a continuation of a long-standing US foreign policy tradition that dates to the Wilson administration. Announcements from the Bush White House that the enemies of the US are “evil” and if grouped together they constitute “the Axis of Evil” makes one wonder not just about the moral standards US policymakers, the media and all propagating such notions, but about the level of political maturity and sense of realism. Is the issue of combating non-conventional warfare a religious and moral one, Armageddon about to descend upon humanity, or is this a matter of policy and strategy that government must analyze and arrive at the best possible solution for the benefit of all of its citizens and not just the defense industry?

If only the rest of the nations behaved exactly as the US wishes in everything from their domestic economic and social policies to their foreign and defense policies, then they would not be “evil” and targeted for regime change by Washington. This is not to absolve other nations and organized guerrilla groups of responsibility for their actions. Nor is this a defense of random acts of violence or even organized ones en masse that lack a grassroots support and have as a goal publicity rather than social change. Having said this about the futility of what the US calls “terrorism” as a military means to a political end that is almost never achieved, if “the terrorist enemy” kills x number of people and US military retaliation is 100 times x, then what does this reveal about the US and its resolve to find a constructive solution to a political problem? Of course in the absence of retaliation against “the enemy”, the culture of anti-terrorism could not be justified, hence the need to continue the vicious circle that government and the media project as necessary.

It is true that the mass media in most of the world is very biased, slanted to favor the political and social status quo, lacking in serious news and analysis, focused instead on business and entertainment. Mainstream media is simply an instrument of the status quo rather than one that critiques the status quo or promotes social justice. It is just as true that the message the US culture of anti-terrorism sends to the rest of the world is military solutions work against any enemy of the state baptized “terrorist”, while human rights and social justice need not be considered. In other words, the US anti-terrorism culture has global consequences, especially when the US encourages military solutions only to the complex problem of militant conduct among young Muslims who see right through the hypocrisy of US foreign policy.

At the urging of the US, the UN adopted 16 conventions against terrorism, but the poor countries, especially African countries, have resisted pouring precious assets in this area because health needs – infectious diseases especially – as well as primary food needs take precedence. Besides the poor nations that are forced to spend resources on what the US defines as “terrorism” and to divert resources from human needs, all countries have become more militarized as a result of the US global counterterrorism campaign. Just as disturbing, many countries have been using the “war on terror” to violate their citizens rights; after all, the US does not observe human rights, according to the Senate Intelligence report on CIA torture of political prisoners.

It is up to the American people to change the destructive culture of counterterrorism that is a pretext for preserving the political, economic and social status quo and makes society more dangerous rather than safer. The first step to change is to become aware of what the anti-terrorism culture is all about, rather than accepting the incessant indoctrination of media, government, business, and social-cultural organizations. Social justice cannot possibly be realized under counterterrorism regime. Under the current legal system and political-cultural climate, it is very difficult for anyone who does not wish to be isolated from the mainstream to speak out against the culture of counterterrorism.

Of course, there are academic works on the subject, and of course there are blogs that express opposition to the status quo under the counterterrorism culture that has resulted in quasi-police state practices, everything from denying human rights to cops shooting down unarmed black youths as though they are the terrorists. A society that does not permit dissident voices to be heard not in the periphery but within the mainstream as part of the debate about the social contract, a society that treats dissidents as unpatriotic, pro-terrorist elements that the FBI must place under watch, such a society is authoritarian and has no political or moral authority to preach democracy to anyone in the world unless it first begins to practice it for itself.

Mass killings in the form of state-sanctioned warfare have always carried a sense of glory, virtue, and honor, although the end result is mass destruction. By contrast, individual acts of political violence, including political acts the state labels “terrorism”, imbue the general public with extreme fear, categorical condemnation, and demands for severe punishment of the ‘criminals’ behind the random acts of political violence. Historically, terrorism has never accomplished the goal of social justice that it ostensibly intended by using ‘unconventional warfare’. This is because the state and established institutions targeted by terrorist organizations is far more powerful instrument of violence on a sustained basis than any individual organization.

The state mobilizes public support for itself and institutions it protects, while the majority of the population falls in line with the state that presents itself as ‘protector’ of public interest. It would be naive to deny that the state has every right to protect its people and its national sovereignty combating any threats from hostile forces. However, there is a huge difference between the state’s right to self defense within its own borders, and unleashing a global “war on terror” that violates the national sovereignty and rights of innocent people, while at the same time promoting a culture of counterterrorism.

Without engaging in lengthy analysis of ‘the ethics of counterterrorism’, analysis that can be approached from different ideological and political perspectives, the bottom line is that counterterrorism measures used as a pretext for police state methods benefits the political, economic, and social status quo. At the same time, counterterrorism precludes democratic preactices, societal progress to the benefit of all people, and social justice, while it maintains a “military-solution based foreign policy” that invariably results in disaster for all parties concerned.

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The global significance of Greek elections in 2015

January 27th, 2015

 

 

 

By Jon Kofas.

 


The global significance of the election in Greece is the symbolism of popular opposition to:

a) Western-imposed austerity that results in income redistribution from the bottom 80% the population to the top 20%;

b) Blatant disregard for national sovereignty of debtor nations by the hegemonic creditor governments that represent finance capital;

c) Popular democracy can prevail despite the massive propaganda by the mainstream media demonizing any political party or movement appealing for social justice;

d) Contagion effect, as other political movements, PODEMOS in Spain for example, will follow the precedent set by the Greek election

e) A major blow to the neoliberal model of development under globalization that the West has been presenting as “the only way” to conduct economic and social policy.

f) The EU and the US will exert immense pressure on the newly-elected government to pursue neoliberal policies with some watered down version of social and economic policies that take into account the working class and waning middle class. In short, a strategy of co-optation has already begun, so that the center-left party becomes in essence a neoliberal one in policy but remains center-left in rhetoric.

g) If co-optation fails, the challenge of the financial and political elites now is to prevent popular political parties in other nations asserting national sovereignty and social justice as cornerstones of their platform. This means that there will be an international overt – media propaganda – and covert efforts through political and economic means – to undermine, discredit and topple the elected government and bring about regime change.

On 25 January 2015, Greece elected SYRIZA, a left-of-center regime opposed to the harsh austerity measures that the IMF and EU had imposed along with a series of policies that essentially resulted in the super-concentration of wealth in the hands of a few thousand families while 50% of youth were unemployed in an economy where “formal unemployment” remains at 26% and the poverty rates at one third of the population. These are Great Depression conditions, but the defenders of austerity and neoliberalism insist that there is no alternative.

The initial Western press reaction ranged from panic to caution about SYRIZA that people chose to lead them. Nothing about the process of democracy working, nothing about popular sovereignty, nothing about the sense of hope, real  or not, that the new government instills in a country that has seen its income drop by one-third and the middle class destroyed. The only issue is that neoliberalism now threatened beyond Greece, in Spain, Italy, Portugal and other debtor nations that will dare choose governments representing the majority and not banks and corporations.

Some media outlets called SYRIZA Communist, others radical left, others populist left. Not a single mainstream media outlet bothered to explain the ideological orientation of the political party or its platform, other than to state it opposes austerity, opposition that right wing political parties across Europe also share. Instead of stating the ideological position and specific platform of the party, the mainstream Western media simply warned that SYRIZA poses a threat to markets and to EU’s stability, as though the EU has been stable in the past five years when SYRIZA was in the opposition.

SYRIZA is a coalition of Socialist and reformist centrist political elements that rests on an ideology of reformism within the system. Its ideology has roots in European Socialism, with strong elements of the Euro-Communism of the 1970s. Eclectic and rooted in the concept of social justice that entails creating a strong social welfare safety net, the ideology of SYRIZA is classic European social democratic, despite rhetoric that tends to carry over to Socialism. The party platform includes private sector backed by the state, a multi-dimensional foreign trade policy and a foreign policy rooted in national interests rather than Western imperial interests intended to destabilize the Middle East and Balkans.

The triumph of neoliberalism – a trend that started under the conservative governments of Margaret Thatcher and Ronald Reagan in the 1980s – was complete with the downfall of the Communist bloc and the global economic integration in which Communist China became the engine for global growth since the 1990s.

The symbolic significance of SYRIZA winning the election has shocked the neoliberals across Europe, because they fear national sovereignty and popular resistance to globalization. Throughout the 20th century, the Western countries tried everything from political and economic pressure to military coercion to pursue their interests in non-Western countries as well as the periphery of Europe. The goal was always integration under the patron-client model, a model of hegemony by the Western countries – the patrons – over the rest they see as client states serving Western economic, political and military interests.  The anathema for the West has always been a strong state representing national interests and opposed to the patron-client integration model.

How did Greece along with many other EU and non-EU countries fall into debt? The number one culprit was that the fiscal system favored the top income earners, the financial elites foreign and domestic, forcing the state to engage in heavy borrowing to meet its needs, among them a very expensive defense program that added nothing to the productive capacity of the economy. The austerity and neo-liberal solution resulted in a sharp rise of the public debt which cannot possibly be serviced under any conditions short of a 50% haircut with the investors taking the loss.

The economy has been experiencing negative growth under austerity, unemployment and poverty rates are the highest in the EU, and the prospects for development are almost nil in the absence of massive investment that has been absent. Despite this reality, the representatives of the Western financial elites have already condemned SYRIZA even before it has had the chance to take power.

Defending neo-liberalism and corporate welfare, which means massive transfer of public funds from social programs to corporations, a number of bank representatives have argued that SYRIZA must either comply with IMF-EU austerity, or face the consequences of no credit from the European Central Bank. Naturally, this means that Greece must accept integration under the German-imposed patron-client model, or face a possible exodus from the euro.

Saxo Bank chief economist Simon Smith argued that:  “The troika (ECB, EU & IMF) are now in a bind. If they cede to [Greece’s] demands, then markets will display no faith in the ability of other eurozone members to stick to austerity policies. If they stand their ground and Greece leaves, then the irreversible nature of the single currency would have been broken, which would make other peripheral nations more vulnerable as investors would be prepared to price in exit in certain circumstances.”

The Europeans know very well that if Greece leaves the euro it will be even more costly for the creditor nations and the markets than if it remains and cuts a deal to reduce its public debt and payments it cannot possibly afford to make unless it impoverishes more than half of its population. The financial and political elites have major challenges not because SYRIZA won the election in January 2015, for that may prove highly symbolic victory for popular democracy, but because the rest of the world, especially the rest of EU, needed a concrete example to point the way to an alternative that at least addresses some social justice and gross socioeconomic inequality issues.

If Spain follows the Greek example, that will not be just a symbolic defeat for neo-liberalism, but a substantive one with serious political and economic consequences for the EU. Fear and dread of popular democracy and national sovereignty on the part of the financial elites and mainstream political parties remains very strong motivator for the strategies they adopt to combat any efforts to water down neo-liberalism and the patron-client integration model on a world scale.

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US-led Sanctions and Germany’s EU Integration Model at Risk

January 7th, 2015

 

 

By Jon Kofas.

 



 

Germany’s dilemma in 2015 is that it must resolve the contradictions between its path of forging a new patron-client integration model on the one hand, and dealing with the combined pressures of sanctions on Russia and the Greek crisis with possible spillover impact on the rest of the euro zone. Is the German economy able to withstand the pressures of continued austerity that has retarded growth and led to high unemployment across Europe, especially in the southern and eastern periphery, while at the same time withstand the additional pressure of diminished trade with Russia because of continued sanctions on which the US insists the EU participates? Making matters more complicated, there is a question whether the export-driven German economy and the EU are able to withstand the political pressures of Euro-skepticism coming from both the rightist and leftist political parties in Europe that question the German-imposed integration model as beneficial for all EU members.

Sanctions on Russia and the January parliamentary elections in Greece have caused some considerable downside pressure on the euro’s value, despite the record-low energy prices. If Greek voters elect SYRIZA that promises to end fiscal austerity and neoliberal policies across the board that the International Monetary Fund, European Central Bank and EU have been imposing, then Germany and the EU have a problem. Regardless of whether Greece leaves or stays in the euro zone, the cost to Germany and the EU economy would be about the same, as I noted in an article on the subject when the Greek crisis started in 2010. German government officials, bankers and the establishment media have warned the Greek people about voting for a government opposed to foreign-imposed austerity that would cause instability across the EU economy.

German Message to the US

The combination of a weak EU economy made even weaker by political uncertainty that Athens and the US-led sanctions against Russia has forced the government of Chancellor Angela Merkel to send some strong messages against those opposed to austerity and those in the US and some in Europe favoring sustained and even stronger sanctions against Russia. At stake here is not a temporary setback for the German economy that would probably not achieve GDP growth above 0.5% in 2015, but the patron-client integration model that would presumably guarantee German economic hegemony over the periphery of Europe, that is all of southern and eastern Europe.

On 4 January 2015, German deputy Chancellor Sigmar Gabriel expressed a concern that most EU governments widely share about Western sanctions on Russia. “The goal was never to push Russia politically and economically into chaos…Whoever wants that will provoke a much more dangerous situation for all of us in Europe.” Germany’s warning dramatized the reality of Russia’s nuclear capability, but also the futility of sanctions which not only destabilize Russia in every respect.

Beyond Russia’s nuclear capability and the fact that sanctions have not worked in so far as forcing Putin to accept US demands regarding the Ukraine, the timing of sanctions came when the EU economy was struggling to revive against incredible obstacles of austerity. The convergence of the sanctions and the real possibility that Germany would have to make concessions to Greece so that the euro zone is preserved has had an impact on the currency trading at the lowest level in nine years.

EU prospects for growth are limited considerably until both the Greek question is settled after the election of 25 January 2015 and sanctions over Ukraine are also settled through a negotiated settlement with Moscow.
The Germans were never at ease with the US-led sanctions against Russia, but they went along and tried to convince public opinion this was the right thing against the “evil tyrant Vladimir Putin” who violated Ukraine’s territorial sovereignty by annexing Crimea and meddling in the nation’s internal affairs. Even before the sanctions went into effect, the German government had expressed reservations, largely because German businesses strongly opposed any action that would harm their interests amid a period of weak economic performance across Europe.

Beyond the tangible economic interests and Germany’s market share loss in Russia, there was and remains the issue of the effectiveness of sanctions on a country that has the ability to diversify its trade relations and has proved throughout history that it can endure hard times. The German message to Washington was that the US has the luxury of imposing sanctions on a country with which it does not have extensive trade relations, while forcing northwest Europe to pay the price of those sanctions.

 

German Global Economic Competitiveness

Enjoying GDP $3.2 trillion (PPP), Germany can become more competitive in the 21st century if it adopts the patron-client model of integration that it has been pursuing in the last five years and one that is not much different than what the US has been pursuing in its economic relations with Mexico and Latin America. As a creditor nation, Germany sees that it is in its interest to maintain a strong euro which at the same time maintains the patron-client model by keeping the periphery EU countries economically weak and dependent on northwest Europe, and especially on Germany. Sanctions against Russia, especially if they drag out as they have for Iran, pose a threat even greater than Greece leaving the euro and defaulting on its public debt part of which Germany would have to write off regardless of the election outcome.

The German government wants to continue the hard currency regime through austerity measures that Chancellor Merkel has imposed on the rest of the EU in the last five years, while at the same time stimulate economic growth under the neoliberal model of privatization, low wage and flexible labor policies favoring businesses at the expense of workers. So far this strategy has succeeded in driving down living standards across much of Europe that hurts the export-driven German economy and accounts for its current GDP growth slump. German politicians and business people are arguing the reason for their economic problems is the US-led sanctions on Russia that have undermined EU economic growth prospects. Even before the EU sanctions, German-Russian trade had dropped by 15% and it is expected that it took another major hit in the second half of 2014.

The value of German-Russian trade was 76.5 billion euro in 2013. Although Russia ranks 11th as a destination for German products and services, more than 6000 German firms have investments in Russia and ten percent of all German firms do business with Russia that absorbs about 37 billion euro worth of goods and services. Because Germany is Russia’s third largest trading partner, the sanctions both by the West and Russia against the West threatens to undermine German-Russian economic ties. While it is true that Russia needs German investment and technology, it is also true that Germany is energy dependent on Russia that some Europeans see as the aggressive imperialist taking advantage of its military might, while others see it as victim of an aggressive militaristic US-NATO foreign policy intended to bring it to its knees.

Political elites across Europe find themselves challenged by leftist and right wing political parties that are vehemently anti-German and anti-austerity. Although Chancellor Angela Merkel enjoys greater popularity than any of her EU counterparts, she is the most unpopular leader in the rest of Europe. Meanwhile many Europeans see Putin as a strong patriot defending Russia and the Russian minorities against the predatory West. In today’s age of web info and multiple sources of information it is difficult to hide the covert role of the West ultimately trying to secure cheap labor, agricultural products and minerals in Ukraine.

The German economy has the most to lose as a result of the Greek public debt crisis just as it has a great deal to lose from the Ukrainian crisis. This is the reason that Gabriel, the German ambassador to the US, finance minister Wolfgang Schaeuble and others have been sending messages about the futility of sanctions, and in essence delivering exactly what German banks and big industry want from the Merkel regime. That all of Europe is suffering at a time that the US is enjoying robust growth leaving its EU partners behind is troubling because eventually this will impact the US economy as well.

The Limits of Sanctions Against Russia

The interdependence of EU and Russia goes to the core of what German officials are addressing, but at the same time the US-led policy of debilitating Russia to oblivion and expecting the European to pay the price for US containment policy. The realization that Moscow will never submit to a US client or dependency state on the West, no matter the severity of sanctions drove the German government to issue such a warning. After all, the issue here is not Putin negotiating because the US imposed sanctions. When the USSR dissolved, there were 15 separate republics, and that was in itself sufficient weakening of Russia. Nevertheless, the issue for Western hardliners is to have Russia submit to everything the US demands. This includes everything from having its neighbors submit to economic integration with the West to closer political and strategic relationships that would reduce Russia to a lesser regional power than it is today.

Vice Chancellor Gabriel’s warning to hardliners in the US is also a reminder that regime change in Russia is impossible through sanctions. After all, Russia today is already integrated into the world capitalist system and has significant ties with China and much of Asia. China will never permit the US to determine the Eurasian balance of power, and on this issue it has the support of most Asian countries. This is not because China, India, Turkey, Iran, or any other country has any great love for Russia as an ally, but because it is not in their best interests to permit US hegemony in Eurasia. Although Japan has clearly sided with the US on sanctions against Russia, behind the scenes it wants a political settlement as much as Germany, because it does not want rival China to derive all the benefits from Russia’s isolation. The economy of Japan is debt-ridden and in desperate need of stability instead of the kind of instability that Ukraine invited to the global scene. Even if regime change were to take place, the idea that Russia would become a satellite of the West is simply absurd as much for China as it is for Germany and Japan.

One reason that the Bolshevik Revolution took place is precisely because Czarist Russia had been reduced into a financial and economic dependency of northwest Europe, although it had the resources and potential to be richer and more powerful than Europe. It is one thing to have regime change from Communism to capitalism that took place when Gorbachev permitted for the transition to take place, and entirely another to have a capitalist country of Russia’s actual and potential power become a satellite of the West.

There is also another very important issue to consider here, namely, the nature of regime transition, if that were to take place as many right wingers in the US are hoping. First, would such a transition be peaceful as it was from Communism to capitalism or violent as it was from Czarist Russia to Bolshevism? Second, would the new regime be more or less friendly to the West, would it be more or less nationalistic? Third, if sanctions continue, do they not simply solidify the existing regime because people rally around the leader of the nation who is viewed as patriotic against foreign interference?
Fourth, what are the chances that the main beneficiaries from an existing hardened Putin regime or a new one would not be China while EU would suffer immense economic lose ground even more amid a lingering recession? Fifth, President Jimmy Carter recently noted that US economic sanctions against North Korea are targeting people in the lower echelons and not the elites. This is a human rights tragedy attributable to misguided US foreign policy.

If sanctions continue against Russia, is the US and EU punishing Putin and the elites as they claim, or the ordinary people of Russia? It is utterly absurd for US policymakers to assume that the people of Russia who have been suffering as a result of US-led sanctions blame their own government instead of the US trying to encircle their country and deprive it of what it deems historic allies on its own border. Gabriel touched on this issue indirectly, warning that there are those who are trying to use the Ukrainian crisis to destabilize Russia instead of solving the crisis between Kiev and Moscow. He made it very clear that Germany does not want to see Russia on its knees as some in the US and Europe, because that is not in Germany’s best interests.

As a major trading partner of Europe, Russia has already made very large trade and investment agreements with non-Western countries at a time that EU needs more markets. Western sanctions combined with a 40% decline of Russian currency accounts for a weak economy. The Russian economy cannot be a consumer of EU products and services, thus driving another blow to EU recovery simply because US and some European ideologues want to impose hegemony over all of the former Soviet republics and reduce Russia into a weak regional power.

The significance of Gabriel’s statement, something that other German officials have expressed as well, is in its agreement with what Putin has been saying about the West trying to weaken Russia and using the Ukrainian crisis as a pretext to do so. After all, the West has spent millions in the last three years in Ukraine to make sure it breaks away from the Russian orbit of influence. The so-called Ukrainian crisis became one only because the EU and US made very bold attempts to reduce Ukraine into an economic, political and strategic satellite that would clearly pose a threat to Russian security, while at the same time disregarding the rights and interests of the Russian minority within the country.

Putin and all post-Soviet governments are hardly models of democracies, and there is no doubt about a regime that walks a fine line between authoritarianism and cult of personality. Nevertheless, Russia is committed to their national economic integration with the capitalist system, although Russian capitalism is based on a small group of politically-linked individuals owning most wealth. This social structure is symptomatic of capitalism that the US and Western Europe helped to promote in Russia, but only changed their tune when Putin asserted economic nationalism must take precedence over foreign interests, at least foreign interests the government did not approve.
Germany and the end of the “Embourgeoisement Thesis”

Germany has set its goals on achieving the patron-client integration model within the Euro zone that has transformed the single-currency economy into the rich creditor and poor debtor members. A fundamental reason that countries wanted to join the EU and the euro zone was the promise of economic improvement through an integration model that would lift the weaker nations via financial help from the stronger ones. This would then translate into the promise of upward socioeconomic mobility for the majority of the population and the realization of stable pluralistic societies. In short, the EU model was rooted in the EMBOURGEOISEMENT THESIS (something more or less like the American Dream). Instead, the recession of 2008-present, and Germany’s insistence on impoverishing the entire periphery area from southern to Eastern Europe has grossly undercut the embourgeoisement thesis.

In April 2013, Chancellor Merkel denied that there is such a thing as “German hegemony over Europe”, but she insisted that EU countries must cede more national sovereignty to overcome the debt crisis. The irony of Merkel’s comments made in an audience with the Polish Prime Minister was that Poland like the rest of Europe fears Germany has learned no lessons of its 19th and 20th century quest for hegemony and it is now trying once again to achieve the same goals under the protective bloc mechanisms of the EU. As some scholars are trying to determine if the post-Communist world structure has any resemblance to pre-1914, it may be useful to also consider the controversial book by Fritz Fischer, World Power or Decline? This is not to suggest that contemporary Germany resembles pre-1914 or that the modern world power structure does either, but there are some very useful parallels to consider.

There are those who argue that Germany has gone back to 19th century ideology rooted in Ludwig von Rochau, Grundsätze der Realpolitik angewendet auf die staatlichen Zustände Deutschlands (1853). If indeed some Germans among the political, economic and social elites believe that the imperative of nature on which the existence of states depends is fulfilled in the historically given state through the antagonism of various forces, then it is the realities of the current regional and global political economy that are responsible for it, and not any commitment to ideology.

Assuming that the law of the hegemonic forces in society is similar to or a reflection of the laws of nature in its hierarchical patterns, then one must assume that if France, Sweden or any other country was in Germany’s dominant economic position, and the international climate permit it, that country would follow the same path as the Angela Merkel government. In short, the structural patterns of the political economy domestically, regionally, and globally are far significant in how Germany is behaving than any ideology that is used subsequently to justify/explain those patterns.

To compete with China and all of the BRICS nations (Brazil, India, Russia and South Africa) as well as with the US and Japan, Germany had to abandon the ’embourgeoisement thesis’ that promises incorporating more workers into the lower middle class. Politically, people believe they really have no choice but to reluctantly accept neoliberal policies and austerity. Given the end of the Communist bloc and failure of Communist regimes, what do the mainstream “middle of the road voters” do but follow whatever capitalism offers no matter how dreadful for their lives. The US sanctions imposed on Russia pose a major stumbling block for Germany’s integration model, largely because of timing, namely the extreme uncertainty linked to Greece and the periphery EU members. There are limits to what Germany is able to do to influence Greek politics, as there are limits to the degree it is able to openly confront the US on the sanctions issue.

 

Western Sanctions Benefit China

Will Russia become more integrated with Asia and leave very little room for Europe, or will Germany and other European countries enjoy the benefits of expanding trade and investment relationship with Russia? In short, can Germany and the EU permit the US to undermine the EU economy, while forcing it to spend more on defense and suffer instability owing to a renewed East-West confrontation? Russia cannot possibly be conquered, it cannot be reduced to a Western satellite, and it cannot be reduced to a weak regional power as some in the West imagine. According to polls, 68% of Russians see their country as a superpower, and 84% approve of Putin as their leader. The rise in Putin’s approval rating is traced to the US policy toward Ukraine, considering that he was at 61% approval in November 2013. The US has single-handedly managed to elevate Putin, an otherwise corrupt quasi-authoritarian figure, into hero-politician status, and in return gain absolutely nothing while hurting the EU economy.

The recent German objections over the Western sanctions against Russia come as the US contemplates a new set of sanctions because the existing ones have not worked at all. The strong but private opposition to US-led sanctions comes from the largest German-based multinational corporations including banks, electronics and auto makers is not the only pressure on Washington that has convinced its own companies to respect the sanctions. US companies do not have nearly as much at stake in Russia as their EU counterparts. While the US has moved to lift sanctions on Cuba to benefit its own companies ready to invest in the island, it is imposing a policy of sanctions that further weakens the EU so that the US would derive a political benefit with the Europeans having nothing to show for their sacrifices.

Beyond the issue of who benefits and who is hurt by sanctions, there is also the issue of goals in the immediate future and long term. Europe has a long history of friendly and hostile relations with Russia and knows that confrontation has never achieved the desired result even in cases where the Europeans won wars as in the case of Crimean War in the mid-1850s. In other words, there is the realization that Russia has legitimate security issues, it is a major military power with vast natural resources, and in the 21st century it has more options before it than ever because China is the world’s number one economic power backing Moscow. It ought to alarm the US that sanctions will never work and will have detrimental results for East-West relations. Just as the beneficiaries of the US disastrous war in Afghanistan was China, so is the case with US-led sanctions on Russia.

The Chinese navy has purchased giant Soviet-made Zurb class hovercraft from bankrupt Ukraine and Greece. The purchase of the hovercraft from Greece and Ukraine potentially places NATO in a much more vulnerable position should China wish to become an aggressor. However, this demonstrates the futility of sanctions diplomacy. China’s foreign minister Wang Yi pledged his government’s backing of Russia in case the country sinks deeper in crisis. Having signed a number of very significant energy deals with China, Russia continues to expand its ties with Beijing and other Asia countries, drifting farther from European dependence.

Conclusion

A recent article in Japan Times disclosed that the US has been working behind the scenes to find a political solution to the Russia-Ukrainian conflict responsible for the sanctions both ways and international instability. I have stated in a number of articles that because China has moved ahead of the US economically and it is likely to continue doing so in the next few decades, US policy now rests on destabilizing measures in various countries from the Middle East and North Africa to the former Soviet republics. While this may be a last resort strategy and indicative of desperation, it is a policy that serves the narrow corporate interests, especially those linked to defense. However, such a policy comes into conflict not only with US real and potential enemies, but with its own allies, while it only strengthens China.

German government high level officials are well aware that in many cases US policy is the detriment of German interests. The Council on Foreign Relations reported in June 2014 that US-German relations had reached new lows over the US spy scandals. The sanctions issue and the pressure the US has been putting on Germany to adopt a more liberal monetary policy toward the euro (ease up on fiscal austerity across EU) are actually far more serious to the German political and economic elites than spying.

Regardless of serious differences, the two countries are inexorably linked in the Western political, economic and strategic zone that remains the last sentinel of Western Civilization against the rising Asian global dominance. Germany can differentiate its policies from the US and nuance them when necessary, but it has no choice but to stay a loyal ally, even when the NSA continues to spy on high level German officials. At the same time, however, Germany has invaded Russia twice in the 20th century and twice it has lost. Cordial political and economic relations between Germany and Russia present the best prospects of becoming and remaining a global power. This is something that 19th century statesman Otto von Bismarck appreciated and one reason he tried to neutralize Russia so that Germany could enjoy continental hegemony. The 21st challenge for Germany is to balance its national interests with those of the euro zone and its long-standing ally the US, so that it can remain a global power.

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Afghanistan: Tragic Past, Turbulent Future

January 4th, 2015

 

 

By Jon Kofas.

 


Afghanistan has been subjected to Western military intervention several times in its history, starting with the first Anglo-Afghan war, 1839-1842. This war coincided with the First Opium war that England declared against China, demanding that China permit the East India Company sell Opium inside China, opium that came from India but would eventually come from Afghanistan as well. England fought two more wars against Afghanistan – 1878-1880 and in 1919.

However, it always had great difficulty imposing institutional control at any level owing largely to the rebellious tribes.
While officially gaining its independence after the third war that the British imposed on the people of Afghanistan in 1919, the country remained under the British imperialist sphere of influence, prompting a tribal uprising in 1929. Typical of the manner that the British operated throughout their empire when a country tried to gain independence, in 1933 London imposed a puppet ruler King Zahir Shah who remained in power just six years fewer than the Shah of Iran. The coincidence of the Iranian revolution in 1979 and rise of a secular pro-Soviet regime in Afghanistan came as a shock to the US that was the world’s self-appointed “policeman’ during the Cold War.

The contemporary history of US-Afghan relations is characterized by attempts on the part of Washington to reduce the Muslim nation into a strategic satellite and use it to counterpoise the USSR in the 1980s and Iran after 2001. Backing the disparate jihadists groups, including Osama bin-Laden’s, the US did its best to bring the secular regime down only to have it replaced by the Islamic Emirate of Afghanistan (Taliban) thanks to the support from Saudi Arabia and Pakistan, behind which was the US. When the US toppled the Taliban in 2001, civil war and chaos ensued because the country lapsed into war-lord rule.

The US would simply inherit the legacy of British imperialism at gunpoint. US military and financial intervention in Afghanistan during the 1980s against the Soviet-backed regime resulted in a strong Mujahedin resistance, along with a strong al-Qaeda that the US had also helped so they could bring down the Moscow-backed regime. All of this backfired because what replaced the secular leftist government was a much more militantly anti-Western regime that repressed human rights and declared America and the West its enemies.

Under President George Bush, the stated US goal in invading Afghanistan and coercing Pakistan to accept US military intervention on its soil from which to launch operation against the Afghan regime, Taliban and al-Qaeda was to capture and/or kill Osama bin-Laden thus eliminating the terrorism threat to the US. The stated goal had some merit, although al-Qaeda operated throughout many countries in the world and it was simply impossible to launch military invasions against friendly ones like Saudi Arabia. The unspoken US goal was to establish a foothold next to Iran, given that the US would also invade and occupy Iraq where regime change took place as it did in Afghanistan. In short, the real goal of the US was to determine the balance of power so that Iran does not enjoy that role or at least its power is considerably diminished. NATO sent troops and money to back the US war effort.

In 2008, amid a very deep recession looming in the horizon, Obama campaigned on the “bad war in Iraq” vs. the “good war” in Afghanistan, a campaign that afforded him political “legitimacy” with right wingers and with domestic and foreign lobbies that profit economically and/or politically from perpetual conflict in the Middle East. Before the 2008 election, I wrote a piece about the futility of US persistence in keeping Afghanistan as a satellite, raising questions about US goals relevant to this day:

* If the goal is to maintain a Karzai-type regime that controls only a part of the country while peasants grow heroin whose production has skyrocketed since the US invasion, then that goal has been achieved but at a very high cost to the US and especially to the people of Afghanistan and Pakistan alike. Afghanistan remains a very unstable country, torn by perpetual civil war conflict and it is now the largest poppy producer in the world because its legitimate economy is in shambles and lkely to remain so.

* If the goal is to allay the fears of the American people that the US “will continue to take the war to Al-Qaeda,” the question is whether this has yielded results other than psychological owing to the assassination of Osama bin-Laden. Is Homeland Security taking care of this problem at an immense cost to taxpayers, either that is at $1.6 trillion, as one estimate has it, or $6 trillion when everything is thrown into the mix, from the wars in Afghanistan and Iraq to funds spent at home?

* If the goal is to appease the substantially vociferous right-wing elements entrenched throughout American society from media and business to politics, intelligence services to military, as well as Israel and Saudi Arabia that link their security to a weak Iran, then the money and cost in every other respect is well worth it as far as the US policymakers are concerned

*If the goal is to maintain the military-industrial complex healthy and to use the culture of fear as a mechanism of conformity against the background of down socioeconomic mobilization at home, then the Afghanistan war, along with other US overt and covert militaristic adventures has succeeded. However, the cost is that the majority of the American people do not support US sending or maintaining troops in Afghanistan or anywhere in the Middle East, which is the key to Obama relying heavily on contractor and drone warfare.

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Russia and China, will the two super powers ever collide?

October 19th, 2014

By Jon Kofas.



Russia and China have common geopolitical and economic interests at this juncture because they are both faced with common rivals. What brings them closer together is the threat that they perceive that the US poses to their security interests and to the balance of power at their respective regional levels. Indicative of the common course Russia and China are following because of the common rival they fear is the recent UN vote for rotating UN Council members.

China and Russia voted for Venezuela that the US strongly opposes while they rejected Turkey that the US favors. This is a very strong political message not so much to Turkey which had been immersed in the jihadist rebel movement to overthrow Syria’s president Assad, but to the US that it cannot continue the policy of destabilization.

There is also the question of US-imposed sanctions Russia deems reckless and the containment policy both Russia and China are confronting. Clearly the US has containment if not an encirclement policy toward Russia, justified in large measure because of Russia’s policy toward Ukraine, but also because Putin entertains ambitions of reviving at least part of what was once the glory of the Russian Empire.

At the same time, the US has a policy of deep engagement with China but also a containment policy for strategic considerations and to secure the leverage it desires in Asia with its own allies. These realities of US policy toward Russia and China only bring the two countries closer together, while each is guarded about the power of the other. After all, China is a global economic power with nuclear weapons and the world’s largest army in terms of manpower, while Russia is a regional power trying to revive some of its former glory against incredible obstacles from the West.

Because of the geographical proximity and historic rivalry between China and Russia, Czarist era as well as Soviet era, it is very realistic to assume that the antagonistic relationship is just below the surface and one day Moscow and Beijing could become bitter rivals once there is an absence of convergence of economic and strategic interests. The US that used China to undermine Russia is actually bringing the two countries closer together by the aggressive and destabilizing foreign policy it has been pursuing in the last two decades. I can easily see Russia distancing itself from China in the future, assuming several scenarios play out.

First, China becomes very powerful and Moscow feels that it is in its interest to counter balance it by forging a new relationship with Washington to pursue a joint US-Russia containment policy toward China through regional blocs. Second, I can see Russia becoming disturbed over China’s increasing influence across Eurasia, especially in Muslim countries where it has an interest to secure raw materials and market share. How can Russia use its political leverage to offset China’s rise to globalism?

Several years ago, I proposed to my colleagues at the World Association of International Studies (Stanford U.) that Russia and Israel ought to join both the EU and NATO as a way to secure stability in Europe, Eurasia and the Middle East. This may seem like a dream at this point, but the prospect of closer Russian integration with the EU is not so far off the reality chart because of the energy reliance of EU on Russia, and as China gains strength who is to say what Washington’s position would be on this issue.

For its part, China has a global approach to policy and behaves in a more restrained manner than Russia and much more prone to global stability because of its economic role than the US that has immersed itself in destabilization policies through direct and indirect means in Africa, Middle East, Ukraine, and several Latin American republics. China has a great deal more at stake around the world at this juncture, and tends to be cautious even when it can easily prevail given that it enjoys so much political and economic leverage.

Its ultimate goal is to reestablish some of the glory of the past when China was the world’s powerful empire, but the road to glory has to be one of caution, balancing out the demands of the military elites, the new capitalists, and those of the masses still trying to achieve upward social mobility. Caution means a policy of its own trying to contain the US from further destabilization conduct, while also keeping Russia integrated into the Chinese economy – $400 billion energy deal for example – while insisting on political solutions to the Ukraine crisis.

China has no illusions about Russia as a potential rival and a potential destabilizing regional force. This is evidenced by some of the critical comments Beijing has made regarding Putin’s behavior toward Ukraine. Realistically, China has to have Russia on its side for the next decade, and perhaps even until the mid-21^stcentury when China will be clearly dominant, assuming nothing drastic like a war breaks out. I can see Beijing imposing its own containment on Russia, if the latter becomes an obstacle to China’s economic or military security.

Ukraine is clearly a security matter for Russia and one with an interesting history of US covert meddling, but it is also an issue for the EU that has been pressuring China to lean on Moscow for a negotiated solution. If the issue were not the Ukraine but a close Asian neighbor where Russia was meddling, Beijing would turn quickly against Moscow.

Beijing has not made as much noise about US meddling in Mongolia partly because the US counterbalances Russia at no expense to China. Mongolia has been quietly supportive of Russia over Ukraine. To neutralize China, Putin has been trying to create a China-Mongolia-Russia alliance against NATO and the US.

Even Mao recognized that the US was a “natural” ally of China and had invited the US to accept the new situation during the Civil War with Chiang Kai Shek’s KMT. The US rejected Mao’s proposal, siding instead with the nationalists. The future of China-Russia relations depends as much on US foreign policy toward Russia and China as it does on China.

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