A piece of mine that was published a few months ago that might be of interest to some, especially recent political events in the US.
A …tacit assumption lurks behind calls for the U.S. president to consider how best America can stabilize the global system: that the United States not only wants to help stabilize the international economy but that it can do so. The dominant mode of rhetoric assumes that the key causal relationship runs from U.S. influence to possible solutions for the problems plaguing the global economy. However, there is another way to think about the evidence. What if the key causal relationship does not run from U.S. hegemonic influence to global economic problems, but the other way around? What if global economic problems are imposing ever greater limits on the influence of the United States, and indeed any other putative hegemon that might replace it?
Here, the diagnosis might be as follows—that the great age of economic cooperation of the post–World War II period is the product of a historically unique conjuncture of high growth rates, and of available forms of cooperation that offered readily achievable rewards. We have no warrant to believe that these will continue forever; indeed they might already be abating. Global economic growth may be sputtering as it reaches hard limits…
Furthermore, there is some reason from the work of Thomas Piketty and
others to think that the extraordinary growth rates of recent decades are a historical aberration from earlier times, and may not continue indefinitely into the future. Finally, the low hanging fruit of straightforward tariff reductions have mostly already been plucked. Future economic agreements will have to settle instead for more dubious gleanings from the higher and more inaccessible branches. In such a world, it is unlikely that the incoming U.S. president can do very much to solve global problems. Instead, his or her main task might be to adjust as best as possible to international economic difficulties. Aspiring hegemons will find it far easier to increase economic cooperation and secure global stability in a world where there is reasonable economic growth and cooperation than in a world of stagnant growth and few distributional benefits. We may be moving from the former world to the latter.
This is less an exercise in prediction than in stealing a method from Gene Wolfe (he mentions it in one of his collections; I can’t remember which) for writing science fiction stories and applying it to policy articles. Wolfe’s recommendation is to take the world, change just one important variable, and then see what happens. What I do in the piece is to take the existing elite consensus about trade, benign US hegemony etc, and change just one factor, assuming that economic stagnation acts upon US political ability and will rather than vice versa. The result may or may not be closer to the truth, but it does, I think, plausibly demonstrate the fragility of this consensus to changes in the underlying parameters.
{ 19 comments }
Dr. Hilarius 11.25.16 at 2:55 am
Thank you. I’m not an economist but I find your analysis to be a welcome response to naive ideas of American exceptionalism, ideas that work better at garnering votes than solving problems. Your point that fast-track trade agreements have special interests baked into them, rather than being inserted by congressional action during ratification, is a seemingly obvious point but one I rarely see mentioned.
Paul 11.25.16 at 10:07 am
A colleague of mine offered the more general version of this thesis: that liberal democracy itself may be hard to sustain “in a world of stagnant growth and few distributional benefits” – i.e. that contra the thesis that democracies don’t fight one another, we have never really solved the problem of how to allocate finite resources without violence, but have merely dodged the problem through growth.
David 11.25.16 at 10:44 am
More generally, there’s a hidden assumption in this kind of debate that US action has been effective in the past. I’m not sure this is true, or at least I can’t think of an example where it has. In most international problems a Political Heisenberg Principle applies – the US cannot get involved in an issue without fundamentally changing the nature of that issue, usually into an object of contention and power struggles in Washington. The Washington political machine is so unbelievably enormous, complex, corrupt and inefficient (in spite of some very talented people) that it takes an eternity for anything to come out, and what comes out is often unrelated to the situation on the ground. In my experience, attempts to resolve international issues often begin with US representatives saying sadly “this is what Congress will accept.” The US can use economic and military power to force nations to do things, but that’s not the same as solving problems.
I’m not sure that an aspiring global hegemon would actually want a return to the strong growth and orderly world economy of the postwar era. The fewer rules, after all, the greater is the effect of imbalances in economic power. Likewise, low growth and high unemployment makes small countries and economies much more vulnerable to international predation than rich ones, especially those with reserve currencies. The US (or its elites anyway) have benefitted from low growth, poor states, indebted governments and the consequent low capability for negotiation and enforcement that neoliberalism has inflicted on much of the world. This may be about to change, though, as the consequences of these policies for the US itself (rather than the elites) begin to be apparent.
nastywoman 11.25.16 at 10:47 am
Thought Experiment –
What if America – or ‘teh market’ – (or Anglo-Saxon Economists in general?) wouldn’t have infected the world with this idea of ‘desirable perpetual economical growth’ – and thus all money ultimates floats to ‘investments’ aka: Casinos, aka: ‘markets’ which promise such ‘growth’ – and what if some of these US dudes -(and a few of my fellow sisters) – who wanted to become investment bankers – would have wanted to become just bakers instead -(like in Switzerland – the most competitive economy of the world) – Would America be better in order to stabilize the global system – as what America does and likes -(from Taylor Swift to a lot of different types of Coffee to F..face von Clownstick) – always lives a long lasting impression on what the world thinks it wants and needs?
Lee A. Arnold 11.25.16 at 11:43 am
Henry we’ve already moved past this. China is moving into the driver’s seat. China has a larger share of global exports, a bigger army, & more science and tech people than any other country. Trump isn’t the beginning of the U.S.’s decline in influence; he is its last calling card. Cat’s out of the bag, train has left the station, horse has left the barn. Innovators in other countries will think twice before coming to the U.S. to succeed with a new idea, for fear of being assaulted on the street for having dark skin. (And there is no putting THAT horse back into the barn.) Many countries will scoff at the U.S. for letting Trump discard trade agreements that have been in discussion for a half decade. Any financier with a functioning brain (there really aren’t many of them) will be taking his next tax cuts out of the U.S. to a developing country that will find better profits in China’s coming trade pact. Right now the nuts are piling into stocks to masturbate some quick profits, but don’t be fooled. The world is moving into a Hyooge War between the people who think they can trump others in debt (a.k.a. the “capitalists”) and the people who think that social solidarity is more important (a.k.a. the “socialists”). The Debt-Trumpers vs. The Beehiviourists.
(“that chorus of praise of goodwill girls on their best beehiviour”) Finnegans Wake
John Quiggin 11.25.16 at 11:51 am
I’d take David even further. The era when the US could set international policy goals and be confident of achieving them ended long ago. In military terms, when Macarthur marched his army to the Yalu river. In economic terms, with the end of Bretton Woods. It’s taken 40 or 50 years for this to sink in. But that’s scarcely surprising. A big part of the Brexit vote was the idea that Britain is still, or should be, a great power.
Lee A. Arnold 11.25.16 at 12:30 pm
The Americans can get together with the Brexiters at a hyooge flea market and they can swap old Beatles vinyl.
Ronan(rf) 11.25.16 at 1:51 pm
“Henry we’ve already moved past this. ”
Why open your comment with such certainty and then go on to (1) make an argument that’s completely incorrect, and (2) that is entirely unresponsive to the actual article under discussion?
bruce wilder 11.25.16 at 7:55 pm
Can’t think what to do? Or, how to do it?
Hardly an unusual circumstance for human beings, individually or collectively.
Twenty years ago (I initially wrote “5” and then considered today’s date) I thought the coincidence of several “trends” or “developments” would lead the world to a remarkable consensus on what to do and the urgency of doing it.
I thought people in the U.S. would read Kennedy’s Rise and Fall of the Great Powers” and see the passing of the Cold War as an opportunity for the U.S. to shed its enervating military-industrial complex. Maybe the de-alignment of alliances and ideology could result in a deliberate creation of a global multi-polar concert of great powers. I thought the post-Cold-War domestic dividend might be a political carrot.
I thought recognition of the threat of climate change, coinciding with peak oil, would prompt concerted imaginative effort to restructure the energy basis of the global economy, supported by a broad understanding of the need to do so.
I thought the rising crescendo of critique in my own profession of economics might herald a shift in economic understanding and policy, shedding the empty cliches of “free markets”, “jobs” and tax cuts and government is bad.
Back then, I understood that the economic basis for the U.S. as good hegemon to stabilize a global order was eroding, even as I thought others must surely recognize as much, even amidst the late summer efflorescence of the internet revolution. (We do understand that, right? There is an economic foundation for the U.S. as dominant military power and consumer of last resort and central banker to the world? And, it has eroded predictably away?)
Reflecting now on how I remember my optimistic self of the 1990’s, I can scarcely fathom the subsequent triumphs of mind-boggling stupidity in shaping the world.
The OP asks if the U.S. still has either the will or capacity to act as hegemon, but uses a peculiar historical narrative voice, gentle, nudging to propose consideration of whether it might not be 1946 or even 1999 anymore.
But, I look over recent history, and I really am not satisfied with that gentle voice. That gentle voice would have been sensible in 1995. I am wondering where the appropriate rage might be expressed concerning generation stupid? The invasion and occupation of Iraq. The housing bubble and GFC. The design of the Euro. The F-35 or the Zumwalt. The melting arctic. Oil sands and the Dakota Access pipeline.
The unthinking rhetoric of which the OP complains seems like a cover of sorts for putting morons in charge. Maybe on the eve of Trump we might look forward to the long coming of Peak Stupid.
I know more heated rhetoric carries as much danger of not being heard, but maybe the problem of arguing with the deaf requires some acknowledgement that the ritual rhetoric of American leadership is not just obsolete, but being spouted by an epically incompetent elite.
kidneystones 11.26.16 at 12:25 am
I downloaded the article and find it fairly good. I’d have preferred more historical economic data on growth rates and relative sizes of economies. The economies of India and China dwarfed those of Britain and her former colonies in the Americas up to 1800, I believe, so there’s some solid evidence to suggest that American dominance in the 20th century is the consequence of something other than American exceptionalism. (I may have missed this in your piece.)
Many will be familiar with Gary Engel’s “What Makes Superman so darned American?” Like your analysis I think it stands up pretty well.
http://xroads.virginia.edu/~drbr/engle.txt
hix 11.26.16 at 12:46 am
Is this really a controversial minority view in US political science? Sounds pretty mainstream to me. Maybe cooperation was not that dependend on US hegemoney either some decades ago and everything will be fine without a hegemon.
Alan White 11.26.16 at 3:41 am
kidneystones
First, let me congratulate you on Trumpism. BTW I have sworn already that the two words “President” and “Trump” shall not pass my lips in sequence. The fact that Clinton won the popular vote by a clear majority is sufficient for me to not declare for these next four years those two words together. He is the Assaulter-in Chief or some such. I am ashamed of and fear for my country, and the world.
Second, thanks for the Superman link, though I think its thesis populated a forest of ideology without the necessary trees. What made Superman so darned American was that he sold enough comics–as Spider-man did a little later but surfing the same demographic wave–to make him a cultural force. But if you want to tap into that generational psyche, it’s Marvel’s flawed characters that really dominated the Boomer generation. DC’s 50s-60s sparkling virtuous characters have had to become sullied–The Dark Knight, etc.–ala Marvel’s tortured icons–to become competitive. Oh–to become competitive economically, I mean.
I’m inspired. How about a superhero–I mean now a super-no-one–character Deep Pockets? His origin is to take a paltry million inheritance and through sheer will of illusion make it grow but also make it seem much larger than it is. His first victory is to spend Superman into the ground by silencing The Daily Planet’s promotion of the Man of Steel with his own Man of Spiel.
kidneystones 11.26.16 at 5:17 am
12 @ Kudos, Alan. Very, very witty – Man of Steel vs. Man of Spiel fits.
I’m not at all sympathetic re: your fears for your country, however. Your rhetorical restraint is commendable. Where you and I part, in my view, and I mean by Grand Canyon size proportions, is on the question of safety and self-identity.
As one who is proudly not American, I do not believe your/our war in Libya to be any more necessary, or virtuous, than any other blood-drenched blunder in North Africa-Muslim world than any organized by Republicans. To the outside observer and I’m sure to those on the receiving end of American weapons there is no difference between a needlessly stupid and destructive war organized by Democrats and one organized by Republicans.
No matter what enormous gulf separates you folks from your Republican countrymen, the differences are not at all apparent to me. The suffering of African-Americans in abandoned communities, schools, and prisons continues unabated irrespective of the party in power. Both parties declare war on America’s ‘enemies’ and insist upon the need for these attacks, offering rationales that are equally inane and incomprehensible to friendly observers. (I studied in the states, have American family members, and am immense fan of the US)
One of colleagues sited above was genuinely surprised when I informed him that I do not see any/much difference between the character of Republicans and Democrats. You simply tell different stories to justify self-interest, as do we all. I couldn’t give a fig about Trump lowering the tax rate. The change doesn’t affect anyone I know. And I particularly do not want to listen to any more explanations from Hillary Clinton, or Donald Trump, on how the next ME war is going to finally bring ‘peace’ to the region.
Only one of the two major candidates in your last election has a track record of death and of dragging my country into your wars. And despite all that blood you still, I very much regret to say, have the audacity to declare that the candidate who doesn’t represents the greater threat.
You’re literally asking me to forget/ignore Hillary Clinton’s public record on promoting wars in the ME, the wars America fought in the ME, the damage and death Hillary-supported wars caused. You want others to focus on your Trump scare-doll and ignore the Democratic candidate’s trail of blood and destruction.
You’ve seen the Feb 2011 CBS ‘We came, we saw, he died – ha-ha-ha’ video of your callous, corrupt, uncaring candidate. So, I won’t link to it again.
Trump is one big self-absorbed huckster. Generally war is bad for his kind of business. I’m encouraged by his transparent and early efforts to make as much money off his presidency as possible. This kind of self-interest is the norm, not the exception.
So, welcome to the world of politics.
nastywoman 11.26.16 at 9:18 am
@13
‘So, welcome to the world of politics.’
This is what my Italian Uncle always used to say when he excused ‘Bunga, Bunga’ – and my Italian aunt always had to tell him: that it is a very lame excuse for dirty old men.
And making this point is no desire to bring up some ‘gender war’ it’s only sayen – firstly – never underestimate the desire of dirty old men to wage real wars – and thus the fact that F..face von Clownstick is (also) one big self-absorbed huckster or that ‘generally war is bad for his kind of business’ – isn’t encouraging at all – that his ‘transparent and early efforts to make as much money off his presidency as possible’ – doesn’t include some self-interested ‘real war’.
As that is the norm too, not the exception.
And as the real question here was:
What if global economic problems are imposing ever greater limits on the influence of the United States, and indeed any other putative hegemon that might replace it?’
IT already has been replaced – not by ‘any other putative hegemony’ – but by retreat -(think Brexit all y’all want) – and if ones for example lives in Italy or in Verona or in the nicest neighborhood in Verona who cares a flying f… about the United States of Drumpf or or F…face von Clownstick – and only if one get’s reminded about the coming flood of refugees – or some Northern African Street Seller tries to unload some fake Rolexes – one gets reminded that ‘economics’ are more than the ‘great’ food market every tuesday and friday.
And so in conclusion – enough with the very theoretical and very unpractical discussions here – let’s do it the Italian way – more creative chaos and much less useless factual research!
The problem only can be solved with a lot more ‘improvisation’.
Barry 11.26.16 at 12:27 pm
Kidneystones: “No matter what enormous gulf separates you folks from your Republican countrymen, the differences are not at all apparent to me. The suffering of African-Americans in abandoned communities, schools, and prisons continues unabated irrespective of the party in power. Both parties declare war on America’s ‘enemies’ and insist upon the need for these attacks, offering rationales that are equally inane and incomprehensible to friendly observers. (I studied in the states, have American family members, and am immense fan of the US)”
To me, that’s more bragging about inability to see, than a demonstration of insight.
Eskimo 11.26.16 at 2:54 pm
Bravo kidneystones for an eloquent self-defense. I hope that the President-elect’s national security appointees are as reluctant to allow war to interfere with huckster business as you say he is.
The incoming President seems to be impressed by, and even listen to, generals — General Mattis, for example. Perhaps some of them will have the gruff influence necessary to avert disaster.
Barry 11.26.16 at 4:48 pm
Eskimo, doubt this:
1) War is so very, very profitable.
2) War is the health of the state, and would enable vaster right-wing looting of even non-military things.
3) The only thing more ego-boosting than being president of the USA is being a war-time president.
4) War justifies much domestic repression.
John Quiggin 11.26.16 at 6:06 pm
Barry @17 (3) and (4) are spot on, but (1) and (2) are not. War is unprofitable for the capitalist class as a whole – resources are expended on the war itself, then, if victorious followed by net transfers to the conquered area. See Afghanistan (Russia and US), Iraq ( US), Crimea (Russia) etc. Privatisation is a far better method of looting. There’s a loss to the population in aggregate, but that’s more than offset, for capitalists, by transfers extracted from workers.
mclaren 11.28.16 at 7:21 am
Henry’s diagnosis seems accurate as far as it goes. “What if global economic problems are imposing ever greater limits on the influence of the United States, and indeed any other putative hegemon that might replace it?” gets us in the ballpark of the post-Cold-War boggle, but in the sense of giving us an overview from about 30,000 feet.
It might prove useful to peek behind that bland-sounding curtain of words “global economic problems.” Where did those global economic problems come from? How, exactly, are they imposing ever greater limits on the influence of great powers?
Henry’s description makes it sound as though “global economic problems” just happened. Bad luck. Like the weather. Hoocoodanode? As mysterious and inexplicable as America’s inability to find WMDs in Iraq…
Or maybe not.
The proximate cause of secular stagnation boils down to the rich going full-in on laissez faire cannibalistic capitalism after the only alternative to capitalism vanished when the Soviet Union imploded in 1991 and when China switched to capitalism post-Tienanmen-Square in 1989.
There’s absolutely no question that U.S. productivity is up since 1991 — way up. Look at the graphs. The issue is that nobody below the top 4% has captured most of the income from that GDP increase over the past 25 years, and mainly the top 1% have capture that income. Moreover, this is international. It’s not just happenin America. Britain, Italy, France, you name it, every country is going through this process.
So those economic problems aren’t just some random thing that happened by chance — the global economic problems are the result of rich guys jacking up the pay of the CEO of a corporation to 360 times the pay of the average worker because they know there’s no chance that the communists will win the next election in Europe, or that socialists will win the next election in America. After the USSR blew up and disappeared, socialism/communism got permanently social discredited, so rich capitalists felt free to run amok and tear up the social contract they’d entered into since WW II. And guess what? The rich capitalists turned out to be right.
Back when the spectre of global communism lurked behind the Iron Curtain, the Martin Shkrelis of the world didn’t dare increase the price of live-saving medication by 36,000 percent, because if they did, a lot of people would become wobblies or join the communist party of the USA or start a nationwide strike. And back during the Cold War, the U.S. government couldn’t let labor relations get too bad because America needed all those workers to build the tanks and missiles and artillery shells that would protect Western Europe when those Soviet T-37 tanks started pouring through the Fulda Gap.
But now the Cold War is over. So the Martin Shkrelis of the world can do any damn thing they want. We’ve now got debtors’ prisons again:
http://www.nytimes.com/2012/07/14/opinion/return-of-debtors-prisons.html
The usury rate has been repealed, courtesy of Marquette National Bank of Minneapolis vs. First of Omaha Service Corp. (1978):
http://www.creditcards.com/credit-card-news/marquette-interest-rate-usury-laws-credit-cards-1282.php
So the average citizen now gets raped with 35% interest rates on bank credit cards (in an inflation environment of < 1%, lower than inflation in 1952) and 300% on payday loans if they're poor, or if they're students who've fallen behind on their loans. CEOs pay themselves more in an afternoon that most workers make in a year, and what is John Q. Public gonna do about it? Nothing. There is no perceived alternative to capitalism, so it's game on. Rapine and pillage. America is now 320 million people in a lifeboat, and stay alive you have to throw someone out — and the trouble is that everyone else is trying to throw you out. Welcome to Occupy, Trump, and the collapse of democracy. When the rich get too rich and everyone else gets too impoverished, you can't do democracy.
So now we're back to the 1930s. Mass poverty breed fascism and dictators. It happened then, it's happening now. There is no surprise here. In a recent survey, 57% of people in the U.S. responded that they wouldn't be able to come up with $400 in case of an emergency. The middle class is dying. Everyone is broke. In this seething cauldron of pure desperation, Trump and thugs like him are flourishing for the same reason Father Coughlin boasted a big radio audience in the Great Depression. People are desperate.
And this isn't all just happenstance. Our "economic problems" (code phrase for "the economic looting of the bottom 99% by the superrich after the Cold War ended") were carefully engineered by the rich after the Cold War in the same way that the extermination of the buffalo was engineered by 19th century American elites. They needed farmland and clear train tracks. Today, the middle class stands in the way of globalization and the full repeal of those pesky impediments to corporate power like the Bill of Rights, so the middle class must get euthanized. Obama served as a spiffy hospice nurse, making the middle class a wee bit more comfy on its deathbed. Now comes Trump with the morgue shroud.
But as obvious as the cause of these "global economic problems" becomes in retrospect (draw a straight line twixt the collapse of the Soviet Union and the death of labor unions in America), Henry's diagnosis doesn't explain the connection twixt these global economic problems and America's inability to wield hegemonic power.
So let's take a closer look at what's actually going on. America doesn't just "encounter some difficulties" when it barges in and blows up some third world country and murders a few million innocent women and children…America is actually causing the disruption in the global community today. The U.S. isn’t a bystander in the disintegration of the middle east into a sinkhole of chaos and terrorism. The U.S. actively caused that sinkhole of chaos and terrorism.
America in 2016 is not a force for good. The USA is not “creating stability.” The U.S. is a global typhoid Mary, whatever America touches withers and dies. If America invades a country, that country disintegrates. If America imposes sanctions, terrorism flourishes and extremism and religious fundamentalism explode. If America inveighs against some third world nation, you can be sure a formerly functioning society will soon degenerate into dysfunctional violence, with millions of refugees spilling across borders worldwide, famine, warlords, arms smuggling, mass death. America is like that villain in the cheesy 1950s sci-fi B movie “Hand of Death.” Whatever America touches, socially and economically and in terms of the rule of law and civil society, turns to shit, and degenerates into barbarism and torture and genocide and mass waves of refugees.
And this is extremely profitable for American elites. It’s profitable in two ways: first, Military Keynesianism. Take a look at Paul Nitze’s NSC-68 from 14 April 1950.
https://en.wikipedia.org/wiki/NSC-68
The basic idea was to preserve American capitalism in a massively militarized garrison state by using the capitalists to build weapons for the Cold War. Unfortunately for Nitze and company, the parasite outgrew the host, and now the military-industrial-police-prison-torture-surveillance complex gobbles up more than a trillion dollars a year. (Do the basic arithmetic: 598 billion Pentagon official budget, 70 billion CIA, 70 billion NSA, 70 billion Department of Homeland Security, 73 billion military pensions interestingly not included as part of the official U.S. military budget, 5 billion drone program, JSOC black projects, DOE superweapons like the hafnium grenade and the rods from god project and so on, 70 billion NRO AKA surveillance satellites, 30 Billion Department of Energy AKA particle beam and laser weapons, 1 billion military weapons & military training for police = 917 billions, close enough to 1 trillion per annum.)
https://warisboring.com/americas-real-national-security-budget-a-trillion-dollars-a-year-42c2a2362e16#.a594prat3
So now America’s military-industrial-prison-police-surveillance complex is so big that it’s by far the biggest constituency in Washington. And the Pentagon has made sure that the wars will continue forever by ginning up the usual powerpoint presentations, identifying the usual “critical threats” worldwide, pointing out to the usual congressmen and senators that big-bucks employers in their districts and states will lose out unless the latest U.S. military budget increase gets approved. So the U.S. military budget skyrockets upward, ever increasing, never decreasing. America has become economically addicted to Nitze’s sweet sweet military Keyesian cash, a giant trough of gold that no one in Washington can resist. Like heroin addicts strung on on Big H, they’re peddling everything America owns to pay for it. Throw out the middle class, asset-strip the cities, sell off the freeways and parking meters and municipal facilities to private investors, but keep that sweet sweet military Keynesian cash coming for the ever-larger annual increases in America’s insanely burgeoning military budget.
http://www.theatlantic.com/politics/archive/2012/02/the-real-defense-budget/253327/
As they say in the military, capabilities create intentions. Military Keynesianism creates a garrison state under undeclared martial law chock full of warriors — drug warriors, anti-terrorism warriors, anti-copyright warriors, so many warriors they darken the horizon — and more Buck Rogers superweapons than you can shake a stick at. So of course America winds up invading and destabilizing third world countries around the globe. When one war ends, another must begin. Otherwise, how to justify the constantly increasing insane expense of military Keyesianism? As Madeleine Albright remarked, “What’s the point of this marvelous military if you never use it?”
So we’ve got a strung-up hopeless addict named Uncle Sam crawling into the gutter for another fix of that military Keyesian smack in his arm, while America’s elites run amok asset-stripping the middle class into penury. The great thing about this process is that it’s self-generating. The more countries the U.S. invades and destroys, the more disruption and terrorism and refugees it produces. And the more disruption, the greater the perceived need for America to invade and wreck more impoverished third-world countries. Likewise, at home, Naomi Klein’s disaster capitalism uses the increasing impoverishment of the middle class as an excuse to roll back basic worker protections and limits on interest rates and consumer protection regulations “for the duration of the emergency.” Giant corporations then swoop in and loot the population, and as John Q. Public becomes even more impoverished, an even more draconian round of economic austerity and deregulation and privatization gets justified, the better to asset-strip the population even more savagely. Rinse, wash, repeat.
Eventually you get an American population so desperate that they elect a Trump. Then the asset-stripping gets institutionalized at the federal level. Full medicare privatization, social security rollbacks, the whole nine yards. That’s the big prize right there. 1.2 trillion per year of sweet sweet cash to get Enronized by corporate scammers and legalized loansharking. Trump and his buddies can snort some truly primo peruvian marching powder off the tightest asses of the very finest hookers with that kind of cash.
Without any coherent social or economic countervailing influence like communism to act as a moderator, the nuclear reactor of capitalism goes supercritical and melts down. It won’t be long before we get another full-on Operation Condor, but here in America instead of in the third world.
https://en.wikipedia.org/wiki/Operation_Condor
John Quiggin claims that militarism + asset-stripping isn’t profitable for the elites. He fails to recognize that American elites aren’t a homogeneous bloc, they’re made up of competing factions. The military-industrial-police-prison-surveillance bloc has joined forces with the asset-stripping Wall Street predators, and they don’t give a damn whether our endless unwinnable foreign wars work out or whether our non-working superweapons fall apart or get cancelled before they’re built. A garrison state America under effective martial law is fine ‘n dandy for anti-union corporate labor-busters — just classify the protesters as “domestic terrorists” (something the Pentagon has already done) and Bob’s your uncle.
When the margins get squeezed out of legitimate capitalism by automation + neural nets/datamining + global wage arbitrage + decreasing returns, legitimate capitalism gives way to the Panama Papers, global dark money, asset-stripping, and “Confessions of an Economic Hit Man” by John Perkins.
https://www.amazon.com/Confessions-Economic-Hit-John-Perkins/dp/0452287081/ref=sr_1_2?s=books&ie=UTF8&qid=1480316840&sr=1-2&keywords=confessions+of+an+economic+hitman+by+john+perkins
Why is any of this surprising? Addicts get violent and act crazy. America got addicted to military Keynesianism + laissez-faire capitalism, a drug cocktail more potent than vodka-tequila plus heroin & cocaine in a speedball, and now Uncle Sam is holed up in his house screaming incoherently while shooting at people on the street with his .30-06 Springfield and everyone is weeping and tearing their hair and running for cover. Gee, big surprise. This is not just “a problem” that mysteriously just “happened.” There are reasons why the United Snakes of Amnesia has wound up in the bottom of this gutter. We should mention them.
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