Politics & Economics

The Neoliberal Book Of The Dead: Chapter One

  • October 2, 2014

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PROPAGANDA AND PUBLIC OPINION.

Walter Lippmann 1914.

Walter Lippmann 1914.

The waging of a perpetual economic and social war against an actual or manufactured enemy has been marketed to the masses through a process that political commentator and author Walter Lippmann once called “the manufacturing of consent”. As a concept first articulated in Lippmann’s seminal book Public Opinion published in 1922, it’s central proposition argued that only through the power of propaganda judiciously employed by a specialized class of “well-informed” elites in shaping public policy, could a cohesive society be effectively organized around specific goals that best serve the political class. Lippmann – a charter member of the Council on Foreign Relations,  believed that such a program would have the disrupting effect of rendering the notion of a “traditional democracy” of “omnicompetent citizenry” obsolete.

To put it in another way, “only the well-informed” politically connected class should ideally be the decision-makers, and not the lumpen proletariat who are de facto ignorant in such matters and are ultimately incapable of intuitively perceiving and accurately interpreting a functioning democracy. Later in life Lippmann became more skeptical of his “guiding class” hypothesis, and even published a book titled “The Public Philosophy” wherein he presented a sophisticated argument that intellectual elites were undermining the framework of democracy, a position then not well received by the corporate establishment.

This Forever War, purportedly being waged for the benefit of civilization by an enlightened class of elites which we can now identify as the corporatist state, enabled by the neoliberal policies and practices of Free Market Capitalism and funded through its privately-held agencies on Wall Street and the Federal Reserve, as with all wars, has instead inflicted immeasurable collateral damage on any notion of public citizenry, omnicompetent or otherwise, over and above the considerable physical toll of lives lost, dreams unrealized, promises unfulfilled, futures abandoned or altered, and precious resources wasted. We must add to this ledger, which we can dub The Neoliberal Book of the Dead, the cumulative tally of society’s inexorably altered realities; our unrealized social, economic, spiritual, and cultural covenant both with our children and ourselves, if we are to properly evaluate the impact of invasive strategies such as the use of propaganda employed by the contemporaries of Lippmann’s intelligentsia whom have exploited the mass media as a tool for molding public opinion, manufacturing consent, and turning the objects of such brain-washing programs into willing enablers for their own deprivation. There is an old saying, long attributed to Theodore Roosevelt:


“If you’ve got them by the balls, their hearts and minds will follow”.

Thomas Piketty

Thomas Piketty

Now, thanks to Thomas Piketty, the vast chasm of economic disparity, the product of prolonged economic class warfare, waged against the social strata in order to promote dependency, confusion and to suppress dissent, has been brought to light and exposed to scrutiny, and with the climate clock ticking down to midnight toward what Naomi Klein terms “Decade Zero”, those among the “guiding class” are loudly blaming “terrorists” and everyone else but themselves.

 

“The manufacture of foreign crisis and war hysteria has been used since the beginning of history to suppress threats to class rule. The crooked politicians may work for the “special interests” domestically, but when those same politicians engineer a war it is a matter of loyalty to “our country”. Foreign war is a very useful tool for manipulating the popular mind and keeping the domestic population under control. War is the easiest way to shift vast, unaccountable new powers to the Corporate State. People are most uncritically obedient at the very time they need to be most vigilant.”Noam Chomsky

THE LOST HIGHWAY.

High on the list of casualties in this Forever War has to be those of our liberties. Originally forced on the State by charters and bills of rights, these Rights are decidedly not privileges granted from a benevolent ruling class. Now, because of egregious legislation, like the Patriot Act, passed in the wake of an attack actually perpetrated by Saudi Arabian jihadists from the Sunni Wahhabi Salafi sect (who were definitely not Iraqi Baathists); and the NDAA (National Defense Authorization Act), legislation rammed through Congress as a stopgap for forcibly suppressing, evicting and incarcerating members of the Occupy Movement not just from public spaces, but also to erase the ideology of “We are the 99%” from the public consciousness; we have lost the right to freedom of public assembly, freedom of speech, freedom of the press, and generally the freedom to dissent. Ironically, the Fourth Estate, which stood to lose the most from such repressive legislation, uttered not a peep in opposition largely because the mass media, no longer a voice of the masses has increasingly become a mouthpiece for its corporate owners. Anyone can be labeled a terrorist by a minion of the Corporate State, whisked off the street by the military, incarcerated in a gulag or “renditioned” to a black site offshore, and held indefinitely without due process or counsel. Does this sound like a “Free Country”?

“Oh, I say and I say it again, ya been had! Ya been took! Ya been hoodwinked! Bamboozled! Led astray! Run amok!”Malcolm X

Shock_doctrine_cover

In the lexicon of neoliberal capitalism, nurtured and promoted by acolytes of Milton Friedman’s Chicago School of Free Market fundamentalist economics, The Forever War is being fought for “our liberties” to “defend our country” against perceived national security threats. As explored at length in writer and activist Naomi Klein’s The Shock Doctrine; her searing expose’ of neoliberal capitalism’s assault on the economies of the world, to even suggest that the corporate security state is a greater threat to our liberties than that from any foreign source is akin to a treasonable offense.

This meme of protecting the “general welfare” serves a two-fold purpose; first to mask the true interests of the ruling class which in short is the complete dismantling and privatization of the hard won benefits and programs of publicly operated services like FDR’s New Deal and LBJ’s Great Society, and second to keep us divided and distracted by fear, pitting not only the working class against the underclasses whom have been branded as parasites, deadbeats and “takers”, but also the branding of competing economic systems as threats both to national security and by implication to our cherished moral values. The methodology employed in protecting the “general welfare” has ironically been to divert tax revenues from maintaining those programs actually benefitting the general public, to aggressive campaigns aimed at terraforming both domestic institutions and external markets for exploitation by the corporate state while forcibly disrupting and suppressing any and all opposition by any means possible. Our tax dollars are at work as long as Wall Street is free to raid the Treasury through the auspices of the Federal Reserve.

The New Deal.

As a series of domestic programs enacted beginning with FDR’s initial administration, the New Deal was focused on what was called then, the “Three R’s”: Relief, Recover, and Reform.

The programs made into law included the creation of the Federal Emergency Relief Administration (bank and business bailouts); the Public Works Administration (PWA) and Works Progress Administration (WPA) which oversaw the construction of major infrastructure projects like the Golden Gate Bridge, Hoover Dam, the Lincoln Tunnel, the Bay Bridge, LaGuardia Airport, Bonneville Dam, and the TVA; the Social Security Act; the Glass-Steagal Act; the Federal Writers Project; the redistribution of wealth via the Revenue Act of 1935 imposing an income tax of 79% on annual incomes over $5 million (this is where Thomas Piketty gets his confiscatory tax policy from); and the US Housing Authority which was created to help eliminate slums.

The Great Society.

A broad set of domestic social reform programs launched during 1964-65, The Great Society embraced such issues as Racism, Civil Rights, Poverty, Education, Health, Welfare, Art and Culture, Transportation, Consumer Protection, the Environment, Housing, Labor and Rural Development. Among the programs created under these reforms were Medicare, Medicaid, expanding Social Security, the Public Broadcasting System, the Endowments for the Arts and Humanties, the War on Poverty, the Civil Rights Act, the Voting Rights Act, Head Start, the Clean Air Act, Land and Water Conservation Fund, the Housing and Urban Development Act, the Fair Labor Standards Act, and increases to the minimum wage. Now, in virtually every instance, the budgets for all of the above public programs have been either eliminated completely, consolidated and cut to the bone, or are under continuous assault for privatization from austerity hawks on the Right at the behest of their corporate masters.

Public Versus Private: The Forever War on the Public Sector.

Public programs such as these summarized above were initially funded by taxpayers; businesses and individuals. These tax revenues come from residential and business property tax levies, sales and use consumption taxes, payroll taxes and a progressive income tax system that at the time included confiscatory levies on incomes above a certain amount. The county and municipal property taxes historically have been used to support schools, public utilities such as water, power and waste removal, and large area-wide transportation projects to name a few.

Consumption taxes are used to fund state and local government agencies that are tasked with administering and managing the police and fire departments, the transportation bureaus, health and welfare departments, and the municipal legal system. Revenues from income taxes at the Federal level are used to fund the administration of the three branches of government and their agencies and departments, the military, the Treasury, the National Park System, the Interstate Highway System, the Veterans Administration, the CDC, among others. Payroll tax revenues on the municipal, state and Federal level principally fund unemployment and disability benefits, job training programs, and are the sole sources of revenue for Medicare and the Social Security Trust. All of the above were designed as publicly-run programs to be supported by a “partnership” between the public and private enterprise, each paying its fair share.

B24 Assembly Line

B24 Assembly Line

It was just such a partnership, forged together by necessity and implemented by programs of shared sacrifice, that helped Capitalist democracy persevere over fascism in World War II. Remember Detroit, then called “The Arsenal of Democracy”? You couldn’t buy a new car from 1943 through 1946 because Ford Motors and GM were building tanks and planes instead. Everybody sacrificed, everybody paid, and everybody benefitted. What has changed in the interim is the “who” that is stuck with the bill versus the “who” that is deriving the benefits.

The funds from publicly held pensions are increasingly being transferred to Wall Street and invested in privately managed assets that are often archaic and opaque, offering high management and placement fees to Wall Street financiers but do little for the broader economy and more importantly the welfare of the future pensioners of these funds. In a recent post on The Intercept, journalist Murtaza Hussain reports that:

 

“Of the $3 trillion in public assets currently in pension funds throughout the country, almost a quarter of that has already found its way into so-called “alternative investments” like hedge funds, private equity and real estate. That translates to roughly $660 billion of public money now under private management…Simply put, outsourcing investment decisions to Wall Street instead of giving them to accountable public servants adversely affects where pension investment money goes. When the money is not managed publicly there is no incentive to invest in local infrastructure, and there is nothing to dissuade investors from putting public money into investments that actually harm the local community, for example like outsourcing local jobs abroad.”

 

Who is enabling these transfers of public money to private hands? We can start with the growing number of former Wall Street insiders who now are in control of state legislatures and governorships throughout the country. And guess where they get the money to finance their re-election campaigns from?

For the past 40 years, there has been a gradual shift in the tax burden that funds public sector programs from private enterprise onto the individual taxpayer and not coincidentally, a movement away from public ownership and administration toward the placing of these public sector programs and their assets into private hands. Corporations have lobbied long and loud for a reduction in their tax burdens that in the logic of the Free Market stifles the economy, reduces profits and also not coincidently gives unfair competitive advantage to public institutions that might otherwise be taken over and privatized.

The result over time has been a precipitous drop in tax revenues collected from corporations along with the increased privatization of public utilities, the healthcare system, energy industry, the banking system (The Federal Reserve is not a public institution and never was), the educational system, the prison system, along with the increased use of mercenaries in the military (remember Blackwater?). The private sector has ceased contributing its fair share to paving the road to the American Dream and has in fact taken over the highway for itself while enjoying the fruits of “corporate welfare”.

economicsrevolution_med

Faced with shrinking revenues, municipalities and states cut their budgets and layed off workers. The advent of globalization fueled industry-wide consolidations further exacerbating the outsourcing of jobs while serving the trifold purposes of cutting costs, stashing corporate profits offshore, and avoiding taxes. Former Occupy organizer, David DeGraw in his recent book The Economics of Revolution refers to a hoard of cash estimated to be held offshore at $94.4 Trillion. That’s a T. It is a stash so immense that it would be the equivalent of gifting each and every household in the U.S. nearly $800K! Imagine what could be done with the tax revenues from such a cache.


For most countries, global financial inequality is not only much greater than we suspected, but it has been growing much faster…. it turns out that this offshore sector – which specializes in tax dodging is basically designed and operated, not by shady no name banks located in sultry islands, but by the world’s largest private banks, law firms, and accounting firms, headquartered in First World capitals like London, New York, and Geneva.

” — The Tax Justice Network

 

The Tax Aversion Effect.

It just gets worse, but not for private enterprise. Within the last two decades a frequent negotiating tactic employed by urban developers and their corporate clients when dealing with cash-strapped and jobs-poor municipalities is to demand preferential property tax breaks, environmental concessions, streamlined construction approvals, favorable lease agreements, advantageous energy contracts, re-alligned transportation routes, and other swag in exchange for moving their businesses to a locale. One recent example of this is a program for enticing companies to set up shop in New York State called Startup New York in which businesses are offered a 10 year tax moratorium in “10 regions offering tax-free zones to grow your business”, including New York City. The theory is that the increased revenues from consuming and taxpaying new employees will offset the loss in taxes and fees that would otherwise accrue to the the host city.
StartupNY

But even if this were true in practice – and how do you measure this “tax aversion effect” in practice – such a scenario does little to help the host city to cope with administrative requirements necessary to support a surge in population and increase jobs in the public sector. Plus this scenario only works in theory if the new workers actually live in the city they are employed in, like San Francisco or New York City for instance, which also means converting and re-zoning more urban areas to accomodate the need for an increase in housing density, which then begs the question of how to do all of this and maintain any semblance of cultural diversity and economic affordabilty.

Neoliberal Capitalism will not venture down this road unless it smells a profit, consequently any housing projects created under such a scenario will neither benefit the underclasses who need affordable units to live in nor the taxpayer who will wind up footing the bill to make up for revenue losses from more back-room sweetheart tax aversion deals. Plus there is still the fairness problem. On the one hand, this newly emigrated business will ship its products over city streets and interstate highways. Its employees will commute from home in either groups on company-owned air-conditioned buses or alone in fossil fuel powered cars along those same thoroughfares. Who pays for the upgrading, maintenance, policing, and monitoring of these roads? The taxpayer. Who benefits from this taxpayer largesse? The Corporate State. Here is an excerpt from a video I recently shot along Interstate 40 in Arkansas highlighting the impact of long-haul trucking on public roads.

On the other hand, “fairness” is a meme often used as an integral bullet point in the neoliberal argument for freedom from governmental regulation and control. In the early 1978, voters in California approved Proposition 13 an amendment to the State Constitution decreasing property taxes and further requiring any future increases in rates or revenues be subject to a two-thirds majority both in both houses of the state legislature plus requiring the same two-thirds majority from voters at the local level for increases in special taxes. The effects of this change to the California constitution as of 2009 has been estimated to have cost the state more than half a Trillion dollars in tax revenues. This indeed lifted a heavy tax burden from homeowners, helping to spur a surge in property values unhindered by visits from the county tax assessor until the owner cashed out.

But Prop 13 not only affects homeowners. It also benefits business property owners, who often attempt to use labyrinthine lease arrangements masking the true ownership of a property in order to avoid assessed value increases when these properties change hands as dictated by Prop 13. There was a celebrated case a few years ago reported by Joe Eskenazi in the San Francisco Weekly titled “Prop 13: The Building-Sized Loopholes Corporations Exploit” involving the owners of record for One Market Plaza then Equitable Life Insurance Company, which at the time (1990-91) leased considerable office space to the IBM Pension Plan.


“In San Francisco, a pair of Fortune 500 companies fraudulently cloaked a change of ownership of One Market Plaza, one of the city’s largest office buildings — to prevent a re-appraisal that would have upped the structure’s value from some $113 million to around $400 million. These firms were caught and made to pay — astoundingly. Federal and state filings were uncovered by attorney Michael Mendelson, indicating Equitable and the IBM Pension Plan (the Plan) had executed an arcane financial transaction, obscuring the true ownership of One Market Plaza.

The Plan, looking to add to its real-estate portfolio, asked investment adviser Equitable for advice. Equitable found a solution seemingly beneficial to everyone — why not fob off its own building on the Plan? So it structured the transaction in the form of an annuity, largely backed by one gargantuan asset — One Market Plaza. Equitable and the Plan took pains to conceal their moves from the city.

 

Equitable claimed no change of ownership had occurred on state tax forms, even after it subsequently sold its remaining interest to the Plan, had no ownership or management involvement whatsoever in the building, and canceled its property insurance coverage of One Market Plaza. The Plan denied it owned the building — to the city. But it represented itself as the owner to the Department of Labor. It wasn’t until 2009 that the case ran its course, and San Francisco had just shy of $23 million in additional taxes and fraud payments to show for it.”

—— Joe Eskenazi

THE LOST MINDS.

Education.
Public education is well on its way to being extinct. My father’s generation, products of the Great Depression and beneficiaries of the New Deal, wanted their children to get a free education so their kids could get ahead and be productive participants in perpetuating the American Dream. Ironically, right now in Germany, a country that he and the rest of what we like to refer to as the Great Generation sacrificed so much for in order to defeat during WW II, now offers free public education to its citizens; even college. Inquisitr.com cites reports that Germany is now offering free college education to “all students in the United States as well”. Talk about a poke in the eye with a sharp stick.

But the U.S. educational system is rapidly being privatized into a for-profit industry of charter schools where students are considered to be commodities for the corporate grist mill, and the curriculum promotes the short-term corporate values of blind obeisance and quick rewards versus discourse, debate and long term solutions.

Guess what? The taxpayer is still subsidizing these charter schools, but now at a higher cost than that for public schools and the kids are not producing any better results. Added to this, is the fact that corporations are no longer contributing their fair share of the pie. Residents – usually the property owners – have to pony up for the whole tax bill and it pisses them off. And here comes that old meme of “fairness” again. You hear a lot of grumbling about public schools, like “my kids don’t go to public schools so why should I pay taxes to support them”. “Public schools cater to poor kids and immigrants. I’m not going to foot the bill for those freeloaders.” What is also lost is the sense of a shared responsibility. The sense of community and “The Commons” has been all but erased from public consciousness.

A college education is out of the question for most millennials, especially for those whom are not children of the privileged few and come from the projects or whose families are poor. These kids are effectively members of a lost generation, denied the opportunity to thrive from “the get”, and relegated to lower paying jobs in the market because they lack the credentials that are a necessary product of commodifying knowledge in an economic system controlled by the Corporate State for the sole benefit of its owners.

For those willing and able to sign their future away, knowledge can be bought on the installment plan under various government educational loan programs sponsored by the Department of Education at the rate of tens of thousands of dollars a year. Of course, somewhere down the line, these loans are packaged together, securitized, and perversely sold to investors like insurance companies and endowment funds that keep the university grist mill churning.

Just as a point of reference, when I went to graduate school, the tuition for a full credit load at U.C. was a lttle more the $100 per quarter, plus I was able to take advantage of work-study programs and VA benefits that helped pay the rent. Now if you are not a scion of the wealthy, you matriculate to a future as a debt peon, and a life as vassal to the Corporate State.

 

THE LOST VOICES.

Cha

Another major cost of The Forever War on the domestic front is the diminishment and ultimate silencing of the only voice the people seem to have left; the vote. Those voices have been supplanted in “volumn and volume” by a flood of dark money from the Corporate State and used to buy elections enabled by the Supreme Court’s Citizens United decision. Non-profit 503 (c) 4 corporations funneling tax free corporate political contributions to select campaigns or for ALEC sponsored legislation have completely inundated the political and economic landscape and drowned out progressive and alternative voices for change and the collective good. Money trumps votes. And by extending The Forever War to the working poor by blocking any and all meaningful legislation in support of the social fabric, the elites have effectively disenfranchised the underclasses by discouraging participation in the electoral process. Why have we allowed this to happen?


You have to understand, most of these people are not ready to be unplugged. And many of them are so inured, so hopelessly dependent on the system, that they will fight to protect it. Sooner or later you’re going to realize, just as I did, that there’s a difference between knowing the path and walking the path. I’m trying to free your mind. But I can only show you the door. You are the one that has to walk through it.

Morpheus
– (Character from The Matrix by the Wachowskis).

 

 

Voter Suppression.

Even though there is scant evidence of voter fraud at the polling places, many states have enacted enforcement voter ID laws, which have proven to effectively disenfranchise many low income and minority voters who are legally qualified because they have no driver’s license or photo identification when they show up at the polls. Other forms of voter suppression include, polling misinformation via robocalls, intimidation at polling places, destruction of ballots as happened in a district in Florida during the 2004 election, tampering with voting machines, challenges to a voter’s legal registration status by voter caging.

Crosscheck.

Ever hear of this “voter fraud” program? Crosscheck is a system of lists, comprising more than  Seven Million names, employed in predominately Republican-controlled battleground States to scrub voter rolls and ferret out instances of alleged double-voting solely based on an individual’s name. In a report published on Al Jazeera America after a six-month long investigation titled Jim Crow Returns, reporter and activist Greg Palast writes:

The three states’ lists are heavily weighted with names such as Jackson, Garcia, Patel and Kim — ones common among minorities, who vote overwhelmingly Democratic. Indeed, fully 1 in 7 African-Americans in those 27 states, plus the state of Washington (which enrolled in Crosscheck but has decided not to utilize the results), are listed as under suspicion of having voted twice. This also applies to 1 in 8 Asian-Americans and 1 in 8 Hispanic voters. White voters too — 1 in 11 — are at risk of having their names scrubbed from the voter rolls, though not as vulnerable as minorities. Based on theCrosscheck lists, officials have begun the process of removing names from the rolls — beginning with 41,637 in Virginia alone. Yet the criteria used for matching these double voters are disturbingly inadequate.

“There are 7,200,000 names on the target list of the 28 states in the Crosscheck group; each of them represents a suspected double voter whose registration has now become subject to challenge and removal. But the actual lists show that not only are middle names commonly mismatched and suffix discrepancies ignored, even birthdates don’t seem to have been taken into account. Moreover, Crosscheck deliberately ignores Social Security mismatches, in the few instances when the numbers are even collected. The Crosscheck instructions for county election officers state, ‘Social Security numbers are included for verification; the numbers might or might not match’.”

 

Gerrymandering.

This is a well-known practice for establishing a political edge at the polls for a particular party by manipulating district boundaries for partisan advantage. This practice has been widely used by both Republicans in rural states and Democrats in urban areas to manipulate the vote in favor of particular candidates in certain districts, especially those in racially mixed areas.

 

The Sequester and The Filibuster.

Another way to silence opposing voices borrowed from tactics deployed in The Forever War is to not allow the opposition a voice at all by destabilizing the venues for passing legislation that could potentially diminish one’s political power. This means petulantly shutting down the government when you can’t get your way or ending debate on a contentious subject by taking over the discussion and monopolizing it ad infinitum thus promoting in the eyes of the electorate the image of government as being dysfunctional and unproductive, “so why vote anyway”. Again, Malcolm X is spot on here.

 

THE LONG CON

In the final analysis one has to wonder, after all the taxpayer bailouts, tax aversion schemes, environmental concessions, property assessment deals, rigged leasing arrangements, changes in zoning laws, legal loopholes, revolving door golden parachutes, insider and Flash Boy trading, opaque pension fund privatization transfers, and the corporate welfare scams, whether the kleptocracy otherwise known as Neoliberal Capitalism can even survive without raiding the Treasury, swapping public funds for worthless corporate debt, and deploying the military to distract the public from noticing whose hand is really in their pocket and where their money is going?

Be sure to read the next installment of The Neoliberal Book of The Dead: Chapter II – The Power of Economics

And now you can read Chapter III and Chapter IV of The Neoliberal Book of The Dead. Just follow the links.

Revised June 14, 2016. Originally posted October 2, 2014.
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