Yes Virginia, Obama and the Democrats Are Mussolini-Style Corporatists, Just Like the Republicans

Reader dSquib flagged a “bizarre” article by Mike Konczal in the New Republic titled, “Corporatism” is the Latest Hysterical Right-Wing Accusation: The secret history of a smear.” dSquib seemed quite perplexed that anyone would deem calling Obama a corporatist, which as we’ll demonstrate is patently true, a smear.

I’m actually a bit miffed that Konczal treats the “corporatism” appellation as the sole property of the right wing (in the style sheet of the Vichy Left, calling them “hysterics” is redundant but necessary for the rubes), since I have a prior claim. And what is particularly rich is that Konczal apparently regards the allusion to Mussolini to be unfair:

Right-wing critics have a new favorite word to malign President Obama’s economic policies: corporatism. Naturally, it’s an ugly word. Whether it evokes Benito Mussolini’s fascist Italy or just an image of the rich growing richer through government collusion, it’s a vision nobody would defend. Nobody is for corporatism.

“Nobody is for corporatism”? Huh? Why does Konczal think K Street and “think tanks” which for the most part the arms and legs of corporations, exist? There is an entire large, well funded, and extremely effective business apparatus that extracts lucrative programs, explicit subsidies, guarantees, and various other gimmies from government bodies at all levels. Tom Ferguson has been meticulously documenting since the early 1980s how campaign finance in America works, which he calls he calls the “investment theory of politics“: that political parties in the US respond not to popular will or the interests of broader society, but the patronage of large money blocks, with certain industries preferring one party to the other.

One suspects the reason for the sensitivity within the ranks of the Democratic party water-carriers to the “corporatist” label is that Obamacare is a textbook case. Konczal cleverly tries to undermine this charge by serving up an example of histrionic right-wing messaging: depicting the contraception requirement (PR-wise, the Republican have been big on throwing identity politics into the ACA mix, but they are hardly alone).

Yet Obamacare IS corporatist. Here we have the industries that are significant contributors to why the American medical system is so overpriced – the health insurers and Big Pharma – actually playing a major role in writing the legislation. And how is it not a sop to large companies to have the government require that citizens buy your product or else pay large tax penalties? Mr. Market certainly thought so, for the price of health insurer and drug company stocks jumped the day the ACA passed. And remember, the beneficiaries of Obamacare extend beyond the insurers and pharmaceutical makers. Hospitals, who increasingly engage in oligopoly pricing (most surgeries need to be done in hospitals), also come out even stronger because new requirements imposed on doctors’ practices will make it difficult for a retiring MD who practices medicine, as opposed to servicing the rich (e.g., cosmetic surgeons) to sell their business to anyone other than a hospital.

And the label fits in the banking arena like a glove. I’ve been called both the Bush, but far more often the Obama bank-friendly policies “Mussolini-style corporatism” since 2008, and well before what Konczal claims is the origin of this description, Tim Carney’s book Obamanomics, published November 30, 2009.

We used this expression September 28, 2008, in Mussolini-Style Corporatism in Action: Treasury Conference Call on Bailout Bill to Analysts. And as much as the TARP was a Bush creation, remember that it was nixed by Congress the first time it was presented. Obama, who was seen as the likely next President, not only supported it, he whipped aggressively for it. So TARP has the fingerprints of both parties all over it.

And Geithner was clearly perpetuating Bush policies. Here are just a few of many uses of the “Mussolini corporatism” label:

November 10, 2008 AIG: The Looting Continues (Banana Republic Watch)

When the TARP was announced, we called it “Mussolini-Style Corporatism in Action.” Sadly, it looks as if events are panning out as foretold.

February 10, 2009 Geithner Bank Bailout Plan: Fiasco

Let us not forget that Paulson did manage to dispense the better part of $350 billion in a blinding show of Mussolini-styled corporatism. The new Treasury secretary exhibits similar Italian fascist tendencies, with even less ability to make the trains run on time.

April 15, 2009 US Decides to Disclose (Some) Results From Stress Tests

But the Obama camp has decided we don’t do nationalization in America, as if Mussolini style corpocracy is a better option.

And a personal favorite: March 10, 2010 The Empire Continues to Strike Back: Team Obama Propaganda Campaign Reaches Fever Pitch

Thus Obama’s incentives are to come up with “solutions” that paper over problems, avoid meaningful conflict with the industry, minimize complaints, and restore the old practice of using leverage and investment gains to cover up stagnation in worker incomes. Potemkin reforms dovetail with the financial service industry’s goal of forestalling any measures that would interfere with its looting. So the only problem with this picture was how to fool the now-impoverished public into thinking a program of Mussolini-style corporatism represented progress.

And these were hardly early, isolated examples of this conduct. The briefly-cowed bankers reverted to form once they’d gotten the support they needed to revert to business as usual. While Konczal contends that conservatives fetishize sanctity of contract, we’ve seen the Obama administration invoke precisely the same excuse when it came to not reining in executive pay and using payment of AIG credit default swaps in full to launder Fed support to then-investment banks (remember, no one in the Administration took exception to the actions Geithner took when he was President of the New York Fed):

And recall how the Administration did noting about excessive bank pay and bonuses? After having been rescued by taxpayers, Wall Street promptly paid itself record compensation in 2009 and 2010, over the previous peak in 2007. And that’s in no small measure due to the Administration’s body language. It put very limited restrictions on bonuses to top executives on TARP recipients. When banks howled about these curbs, Treasury permitted the banks to repay TARP ASAP rather than requiring them to keep it until they had raised their equity levels further (the fact that pay levels are falling now in banker-land is an amusing case of being a bit hoist on their own petard: ZIRP and QE initially were huge boosts to them, but a flattish yield curve, low volatility, and an absence of profits on float have eaten into their earnings).

Let us remember some of the Administration’s many other concessions to the banks. The biggest, one we’ve gone after for years, are rampant mortgage servicing and foreclosure abuses. Geithner foamed the runway with homeowners to protect the banks yet again. And after getting a “get out of jail almost free” card in terms of the 49 state attorney general/Federal settlement, banks continue to engage in predatory servicing (trust me, I have plenty of reports from foreclosure attorneys that nothing has changed).

And of course, Team Obama has also only given lip service to the idea of closing the loophole that allows private equity and hedge fund barons to get their already huge incomes that result from labor (managing the funds) to be taxed at capital gains rates. And as Ferguson’s analysis of the 2012 election determined, even though Wall Street attacked Obama for his generally-seen-as-inadequate reforms (and for having the temerity to call them “fat cats”) and did give more to Romney, Obama also got generous contributions from the finance sector.

Of course, we can’t pin the bank friendliness on Geithner alone. The Fed is an equal partner. But Obama reappointed Bush nominee Ben Bernanke, despite considerable opposition in the Senate (Obama had to whip personally, and even then, Bernanke garnered more no votes than any previous Fed chair nominee). And even though Yellen is depicted as “dovish,” she’s widely regarded on Wall Street as continuing Bernanke’s policies, including the Greenspan/Bernanke put.

In fact, it’s rather ironic that Konczal tried to brand the Republicans as fans of hard money, implying the Democrats are all that different. Yes, the Republicans do have a loud libertarian goldbug cohort. But Bob Rubin and later Larry Summers have been staunch promoters of a strong dollar policy, and Geithner was also voiced support. “Strong dollar” means low inflation. And the Clinton cohort was very attentive to the wants and needs of the Bond Gods. One of James Carville’s most famous quotes was,

I used to think if there was reincarnation, I wanted to come back as the president or the pope or a .400 baseball hitter. But now I want to come back as the bond market. You can intimidate everybody.

Similarly, Carter appointee and Obama advisor Paul Volcker is if anything more extreme in his views. He saw it as necessary and desirable to break labor bargaining power in order to tame the inflation of the 1970s; Bill Greider reported in his book Secrets of the Temple that Volcker carried an index card where he kept track of weekly construction worker wages and regarded them a key indicator of whether his effort was working. Just last year, at a March conference organized by the Atlantic, Volcker spoke before a left leaning (by DC standards) group, and again inveighed against the dangers of tolerating any inflation. So these differences are no where near as pronounced as the Democratic party loyalists would have you believe.

And Konczal airbrushes out of the picture that Obama was hoping to secure as the crowning accomplishment of his second term the “reform” of Social Security and Medicare. Even the Republicans came to recognize that going after these programs was a political third rail. And Obama is completely on board with neoliberal, meaning austrerian thinking, particularly the “need” to “live within our means”. By contrast, he’s been complacent even as unemployment has languished at levels higher than those that led Ronald Reagan to decide he needed to take more aggressive action (the 1985 Plaza Accord, among other things). And the idea that the Republicans are somehow trying to steal the populist mantle from its presumed rightful owners, the Democrats, is more than a tad peculiar given that income inequality has widened more under Obama than in the Bush Administration, as shown in the work of Emmaunel Saez:

And finally, how can we forget the ultimate reward to large corporations, that of allowing them to substantially circumvent nation-based regulation by appealing to secret panels that can impose fines on governments? Obama has been pushing hard to get the Trans-Pacific Partnership and the Trans-Atlantic Trade and Investment Partnerships concluded, which also would greatly enrich American drug, technology, and entertainment companies through stronger (more accurately, overreaching) intellectual property provisions.

Thus the Mussolini comparison is apt. Now admittedly Konzcal does not define corporatism; but the Italian fascist version was that of coordinating large enterprise with the rest of society, and it’s not hard to guess who wound up dominating. Il Duce combined centralized coercive powers of government with the elite of the largest industrial concerns, throwing some crumbs to labor so they’d fall in line with the propagandizing to the population at large. This marriage is documented in detail is Denis Mack Smith’s “Modern Italy: A Political History,” and his biography, “Mussolini”. Both works describe a regime which, while claiming to reduce an inflated bureaucracy, needed to do precisely the opposite to reward personal clients and followers. These books also describe how the efforts of Mussolini’s first Fascist Finance Minister De’Stefani to curb tax evasion and limit stock exchange speculation were constantly thwarted by other political cronies of Il Duce, as well as Mussolini himself, who soon allowed the majority of his Cabinet to discredit one of the few competent ministers.

The one bit of good news with Konczal’s efforts at porcine maquillage is that it might be a sign that the Democrats are getting nervous about Obama’s sinking poll ratings. Konczal seems to be following Obama’s preferred course, of using propaganda to distract from policy problems. Unfortunately, given that both parties benefit from using the power and the resources of the state to enrich their patrons, it’s going to take a lot more pressure than we see now from ordinary citizens to shake up this cozy duopoly.

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  1. Ned Ludd

    “And as Ferguson’s analysis of the 2012 election determined, even though Wall Street attacked Obama for his generally-seen-as-inadequate reforms (and for having the temerity to call them ‘fat cats’) and did give more to Romney, Obama also got generous contributions from the finance sector.”

    In 2011, Jon Stewart interviewed Ron Suskind. In the extended segment (which was only shown on the web site), Jon Stewart asked why Wall Street attacked Obama.

    Jon Stewart: We keep hearing that Wall Street guys hate Obama. And my sense is, “Why?” They’ve had it as good as anybody in this country over these past 2½ years, probably better. What’s their beef, in this?


    Ron Suskind: It’s interesting. I asked the same question. I talked to a senior Wall Street guy and said, “What gives with this thing with Obama? You know, you’re after him, he’s anti-business. You know, god! – he couldn’t have done more. He basically opened the federal purse for you guys. He saved your skin… And he says, “No no! You see, of course he’s not anti-business. But when we say he’s anti-business he just ends up doing more for us. So we’re going to keep saying it.”

    1. steelhead23

      And in the eyes of our corporate media (aka MSM), being anti-business is the functional equivalent of being pro-communist in the McCarthy era.

      My read of this piece is that Yves considers the financial crisis to be not merely a result of inadequate regulation and mal-incentives, but a political crisis in which the voice of the majority is subsumed by the voices of the rich through patronage. That is, a thin skin of illusory democracy covering Mussolini’s fascism.

    2. Oregoncharles

      Even better: calling him “anti-business” amounted to campaigning for him, by suggesting to liberals and the public that he was some sort of flaming populist – which he poses as, when he needs to.

  2. timotheus

    “Wall Street promptly paid itself record compensation in 2009 and 2010, over the previous peak in 2007. And that’s in no small measure due to the Administration’s body language.”

    Especially recall Obama’s wink-wink to reporters upon issuing the pro forma criticism of these bonuses. He didn’t even bother to hide the subtext: I have to pretend that my buddies shouldn’t be making trillions, but just among us alpha males, we all know we deserve it. [flick of annoying gnat off fancy suit]

    1. Banger

      The most clearly destructive thing Obama has done is to allow the results of the most massive crime wave in American history to stand. There should have been either thousands or tens of thousand convictions of fraud both top executives and ordinary loan officers and the RE speculators who cooperated. The list is long. Barring that there should at least been a truth and reconciliation commission, something to indicate that the money that I and others lost meant something to those in authority.

      1. fresno dan

        We simply have a one party system, that is on the same page with regard to anything that has to do with money – people who finance the campaigns are above the law. Sure, it appears that they hate each other, much like the wrestlers in professional wrestling appear to hate each other, but its all scripted.

      2. Gaianne

        “The most clearly destructive thing Obama has done is to allow the results of the most massive crime wave in American history to stand.”

        For true!

        And really, that tells you all you need to know. Everything else follows from this, or is just small details.


  3. from Mexico

    The Obama bashing by Wall Street also enhances Obama’s left-wing credentials.

    I was watching this gay-themed movie the other day, and there’s this scene where two gay lovers are making out in the men’s locker room. One is a super jock, and the other nelly and more obviously gay. They get surprised by a group of other jocks walking in, so the gay jock pretends he is beating up the nelly gay guy.

    The next scene is the two gay lovers walking away laughing about how they fooled the jocks.

    The left-wing is like the jocks. The conflict between Obama and Wall Street is like professional wrestling: great entertainment, but it shouldn’t be mistaken for a real contest. The problem with entirely too many on the left is that fall for the kabuki.

    1. bh2

      Critical thinking is regarded as a vice by a majority of Americans — not least those on the left.

      The political class and their paymasters on Wall Street play these fools like a fiddle, bleeding them dry with never ending debt slavery. In response, the willingly enslaved express their limitless gratitude in the voting booth and reject any temptation to seek manumission.

      People get exactly the government they deserve.

      1. Ulysses

        No, people get the government of corporate-friendly politicians that they are allowed to vote for by corporate MSM and the donor class. Did you notice what happened when the Green party candidate (who jumped through all the hoops necessary to get on the ballot) tried to participate in the Presidential debates on Long Island? She was arrested!!

        I’m really fed up with all this blame the victims nonsense!

        1. Anyone

          Probably a little of both. We’re given limited choices because we’re not more politically astute and because most of us are too busy simply trying to survive; but then again, that can’t be an excuse, given the stakes. But at this point the ship’s probably sailed anyway. Corporate capture seems to be a fait accompli.

          1. beans

            Meet the new boss…..same as the old boss.

            Perhaps the unwashed masses quit caring. As in Vegas, the house is going to win, so why bother?

        2. fresno dan

          I see your point, but honestly, I get fed up with voters who say voting for a third party candidate is “just throwing my vote away”

          Good Fracking Grief!!!!!!!!!!!!!!!! Voting for tweedle corrupt and tweedle corrupter is worse than throwing your vote away – it is actively voting for evil.

      2. Ned Ludd

        Who educates hoi polloi to accept, or acquiesce to, a limited range of options? The government and corporations reward apologists and sycophants while punishing those who threaten the current system. Elites get the citizenry to submit by marginalizing and destroying anyone who mobilizes effective dissent.

        1. Chauncey Gardiner

          I agree, Ned. IMO formation of an effective political organization with critical mass that can generate sufficient social momentum to effectively counter their policies is their fear. Hence, the extensive surveillance; and the coercive and extreme over-reactions in terms of psychological and physical brutality that has been employed against a peaceful and non-threatening Occupy and certain individuals. But, I feel you’re also overlooking those who were swayed by the carrot and have been co-opted. And it’s not always just about the money; there are other “motivators”.

          Tragically if we continue down this path, I fear what an assassinated president once said, “Those who make peaceful change impossible, make violent change inevitable.”

          “Good Will Hunting” was an excellent film.

    2. TelTelCo

      In my experience, they don’t fall for it–they use the democratic party as a kind of policy-laundering racket that lets them strut around unsullied by the right-wing agenda they consistently enable.

  4. Larry Headlund

    I say if we are going to have corporatism we at least deserve a snappy marching song and some interesting architecture.
    Is the ‘master of 11th dimensional chess’ equivalent to claiming the trains ran on time?

    1. Ulysses

      We do have corporatism, and we have the words of a great foe of corporatism, Antonio Gramsci, to put our situation into perspective: “The Italian crisis can only be resolved through the action of the laboring masses. There is no possibility for the liquidation of fascism on the plain of parliamentary intrigues, only a compromise that leaves the bourgeoisie at the lead along with armed fascism at its service. Liberalism, even if inoculated with the glands of the reformist monkey, is powerless. It belongs to the past. And all the Don Struzos of Italy, united with the Turatis and the Vellas, will not succeed in returning to it the youth necessary for the liquidation of fascism.” (October 7, 1924)

      The sad truth is that not even a Bernie Sanders and Elizabeth Warren administration could do much to help us– if the Jamie Dimons of our world are still allowed to live above the law. The transnational kleptocrats scoff at the national sovereignty of the people they oppress. They write the rules in secret (TPP/TAFTA), and whenever any politicians insist on pretending to hold them accountable, they just laugh. “Fine us $13 billion, a very small fraction of our ill-gotten gains? Why not? Much of it is tax-deductible, so Joe and Jane taxpayer are picking up $7 billion of our tab!”

      While it’s true that Obama hasn’t invaded Ethiopia, he sees nothing wrong with killing innocent men women and children in Yemen on their way to a wedding:

      Let’s stop applying more lipstick to this neoliberal pig. A slow-motion corporate fascist coup d’état has already been mostly accomplished. I applaud Yves Smith and other brave writers who dare to speak the truth.

      1. Noonan

        The “laboring masses” are resting on their couches watching TV, or they are out purchasing goods and services on their EBT cards. I don’t think they are going to revolt.

          1. Banger

            Very clever. But can you counter her observation? The reason the left is moribund in this country and, increasingly in the EU, is that many of us believe in the cartoon version of the world with “good guys and bad guys” which gets us nowhere. We have a cultural and moral problem in this country that the oligarchs understand and are able to manipulate for their benefit. We all share in the anti-social tendencies of the culture of narcissism and need to attack it at its roots.

            1. from Mexico

              Wikipedia does a nice job of giving an overview of the blame the victim doctrine.

              As it explains: “Victim blaming occurs when the victim of a crime or any wrongful act are held entirely or partially responsible for the harm that befell them.”


              But as Wikipedia goes on to explain, you are hardly alone in the practice of blaming the victims: “Roy Baumeister, a social and personality psychologist, argued that blaming the victim is not necessarily always fallacious.”

              The best exposition of the blame the victim doctrine I’ve come across is Elijah Anderson’s Code of the Street: Decency, Violence, and the Moral Life of the Inner City:

              “Racism, the changing economy, unemployment, and changing social values all affect the people in the community. But the grandmother, particularly if middle-aged or elderly, often takes an ideologically conservative view and tneds to have little tolerance for structural explanations. Given her prior experience in the local community in the days of the manufacuturing economy, in matters of idleness and unemployment she is ready to blame the victim, because she feels that there is work to be had for those who are willing to do it and that people can abstain from doing wrong if they want to. It is her belief that the various social problems plaguing the community stem more from personal irresponsibility than from any flaw in the wider system.”

              Anderson writes much, much more on the propensity to blame the victim, but that gives a good idea of where he’s coming from.

              Surprisingly, polls show about 1/4 to 1/3 of poor and lower working-class people buy into the blame the victim doctrine:

              “[A]mong the respondents with annual family incomes of less than $10,000 who did not expect to be better off in five years, 32 percent report that the government should not redistribute wealth by heavy taxes on the rich, and 23 percent say that the poor should help themselves rather than having the government “make every possible effort to improve the…position of the poor.”

              CHRISTINA M. FONG, SAMUEL BOWLES, and HERBERT GINTIS, “Reciprocity and the Welfare State”

              Equally surprising is that so few of the well to do buy into the blame the victim doctrine:

              “Among respondents of a nationally representative American survey (Gallup Organization, 1998) who have annual household incomes of at least $150,000 and expect their lives to improve in the next five years, 24 percent responded that the government should “redistribute wealth by heavy taxes on the rich,” and 67 percent respond that the “government in Washington, DC, should make every possible effort to improve the social and economic position of the poor.”

              1. Banger

                How is what I say blaming the victim? But we’ve been through this to many times. Let’s compare this to the populist movement of over a century ago. The oligarchs in the South were able to use race to split the working class along racial lines. The oligarchs were clever–but much of the white working class was racist as it tends to be to this day but much less so. So if I say that am I blaming the victim? The oligarchs used the method that was available as they do today. If the majority is amused with trinkets and entertainments are they totally blameless? Your views echo the right’s tendencies to see things in terms of black and white. Life is much more nuanced than that.

                1. from Mexico

                  How is what you are saying blaming the victim?

                  Well let’s try this on for size from your initial comment: “We all share in the anti-social tendencies of the culture….and need to attack it at its roots.”

                  To begin with, you make an empirical claim which I believe is not true when you speak of “the anti-social tendencies of the culture.” Polls consistently show that most Americans are not as anti-social as you claim they are.

                  But even if your empirical claim were true, you follow it up with a logical fallacy. The logic is the same which Adolf Eichmann argued in his own defense at his trial. But as Hannah Arendt responded to Eichmann in Eichmann in Jerusalem:

                  “What you meant to say was that where all, or almost all, are guilty, nobody is. This is an indeed quite common conclusion, but one we are not willing to grant you…. In other words, guilt and innocence before the law are of an objective nature, and even if eighty million Germans had done as you did, this would not have been an excuse for you.”

              1. Banger

                The actively hurting another is worse than passively allowing another to be hurt but my point is both are to some degree culpable. But also in the mix is the social milieu we live in where hurting others is considered a virtue in many instances.

              2. Gaianne

                If you can organize the masses by all means do so!

                Nobody seems to be doing this.

                Maybe we need a deeper strategy.

                Here is my own hint: We (humans) have destroyed our resource base. That is done. The old days are gone. So is our old economy. It is not coming back. The 1% have figured out the last part if not the first, and are grabbing all they can. The rest of us need to think about what’s possible with what we still have and start working in small groups to achieve it. Think about food and water.

                All large structures are going bad. Learn to abandon them.


        1. Waking Up


          Do you feel contempt for the working class (the vast majority of people) and the unemployed (usually through no fault of their own)? That is how I interpret your comment.

          1. hunkerdown

            Without the hypno-box, some people have precious little reason to stay out of the streets. And without the government providing some minimum satisfaction of certain basic biological needs, there’d be no need for it.

            Sadly, most animals prefer to hold on to their weak sauce and demand others do likewise rather than stare the very real risk of ruin in the face to balance the equation, and collectively, that’s a pretty sweet deal for those with the wherewithal to exploit such people.

            Jakarta is here.

      2. Onemoretime

        Agree with most of what you say. I would only add that Liz Warren’s greatest strength (besides giving excellent media interviews) is her ability to change the conversation, similar to what OWS did. If reform is not talked about nothing is going to change. A lot of the msm is just not talking about it. Many thanks to Yves for continuing the conversation.

      3. PopeRatzo

        If the fear of marxism was the thing that pushed the trust-busting of the T Roosevelt Administration, what possible mechanism can serve that purpose today, other than the threat of great social disruption?

        This isn’t going to get any better until people are prepared to do some things that are currently considered unthinkable.

        1. different clue

          And people won’t think of doing the unthinkable until they are pushed into it by fast rising levels of economic and social torture. The Rumanians didn’t rebel until they finally did. And the authorities will be ready for them with a billion Homeland Security hollowpoint rounds, Raytheon heatrays, high-decibel sonic brain-melters, etc. What would the “people” need to be ready-in-return for the authorities who are ready for the “people”?

          1. hunkerdown

            An intimate knowledge of the adversary’s intrinsic weaknesses and the ability to hammer on them relentlessly even against tactical changes.

  5. TarheelDem

    Any politician or pundit who is constantly talking about the “business climate” and public policy hampering it is a corporatist. Any politician or pundit who talks about “public-private partnerships” is easing into Mussolini-style corporatism. That expresses the core of the bipartisan neoliberal consensus of the past forty years. Every President from Nixon to Obama has been a corporatist.

    It is the origin of such neoliberal schemes as health care exchanges, carbon taxes, carbon cap-and-trade, and charter schools. And we are seeing a generation of failure from these approaches. But the invocation of the fear of socialism is enough to keep the public on this track, electing corporatist politicians every election. Even the so-called libertarians in the US do not see the dangers of large corporations as institutions and advocate corporatist policies.

    1. tedtalks2

      Thanks TarheelDem. exactly what was running through my mind when I read this. And I would add, that certain policy areas are seeming monopolies of Dem party operatives (the unholy alliance between Arne Duncan’s Dept. of Ed., Pearson Publishing, common core standards foisted on the nation by the Gates foundation, and the charter schoolers for example).

    2. from Mexico

      “Every President from Nixon to Obama has been a corporatist.”

      And every one of their central bankers.

    3. bobh

      “…That expresses the core of the bipartisan neoliberal consensus of the past forty years. Every President from Nixon to Obama has been a corporatist….”

      Yes, but Obama has a special place in this history. He squandered a moment in time, November 2008, when there was at least a chance that something might have been done to roll back this tide. All of the pieces were in place, but our idealistic, newly elected president turned out to be the corporatist we have come to know, appointment by appointment, decision by decision, compromise by compromise, as he has showed his true colors and did the bidding of the banks, corporations and militarists who will reward him with Clinton-scale speaker’s fees after 2016. He will leave a terrible mess in his wake for the country–and for the Democratic party which probably lost its last chance to be an agent of constructive change–but the grateful elites he serves got eight more years to extract whatever wealth remains in the country’s middle and lower classes. They should pretty much have it all by the time he is gone.

    4. different clue

      I may be wrong but it seems to me that a carbon tax doesn’t belong with those other things. Couldn’t a carbon-tax be a straight up punitive price-rise against carbon fuels with the money collected by public government to spend on public purpose? At least in theory?

    5. MaroonBulldog

      Every president from Franklin D. Roosevelt to Obama has been a corporatist. FDR was our first and greatest corporatist president.

    6. fairleft

      This is too broad, most glaringly with the addition of Nixon. Surely Nixon was corrupt, and threw money favors at corporations and others who backed him politically. But corporatism, for a politician, is about thinking of yourself as just an intermediary who executes policies ordered by the corporations and corporate sectors that have purchased you and your services. In that sense, I think Reagan is when the profound transformation in attitude took place. Neoliberalism is not a cause but a symptom of the preceding transformation, though some fools do believe in it.

  6. Bob Swern

    And, on the reference to corporate fascism, I’d agree, but I think a more accurate term would be a phrase that Princeton University Professor Emeritus Sheldon Wolin coined: “Inverted Totalitarianism.” (This has been publicized by Chris Hedges quite a bit, too.)

    1. TelTelCo

      It’s not more accurate, it’s a cop-out. The policies are straight-up gangster capitalism and cartelisation, given cover by a constant barrage of fatuities like “TBTF” (a lie on its face) to keep the ridiculous pretense of a liberal state going.

      I prefer “dead parrot fascism”.

  7. PaulArt

    If you read ‘The Battle of Bretton Woods’ a book I bought thanks to Yves putting up the review of the book here on NC, it emerges very very clearly that political will by the leaders at the top is a sine-qua-non to countering the b**stards on Wall Street. FDR and Harry White not to mention Henry Morgenthau (Treas.Sec) were firmly leery of the Banksters and kept them strictly at arms length from every discussion. Any time they came close to meddling they were kicked in the jewel box. What we have today is a Democrat party that has no resemblance to the Democrats of the 1940s. Today we have a bunch of cravenly mammon seeking parasites like Chuck Schumer and others of his ilk boot licking the Banksters. Of course we have the boot licker in Chief Mr.Obama at the top of the pile. Political will is created by the force of the citizenry. White Males today know quite well the looting of the Banksters but they care more about other things like race to do anything to questions their people in Congress and Senate.

    1. different clue

      Except the Dems are not craven. They are trojan collaborators. The “craveness” is a pose to keep stringing their voters along. Bloggers like Digby collaborate in selling the “cravenness” to keep stringing their readers along. For example .

      1. Lambert Strether

        Yep. A lot of people, myself included, bought into the more and better Democrats idea, that all we needed to do was help them by showing them we were behind them. That was the idea 2003 – 2006. Then, amazingly, the Democrats took the House, and immediately Pelosi took impeachment off the table (along with Mark Foley’s sex scandal (“Measure for me”)). That should have put an end to narratives of Democratic weakness right there. But apparently pushing that narrative not only works, it works as a business model. Every “tell them” or “stand with” click through-incentivized fund-raising email you get from these guys still does it.

    2. fairleft

      Kicking white males was a surprise. What is it about black males’ lemming-like support of Obama that allows you attack only white males? And are white and black females, and Hispanics of all genders blameless?

  8. John Mc

    Great topic and nice illustration of how the left is significantly complicit and absurdly cheer-leading neoliberal power. Controversial third-wave feminist Naomi Wolf offered a series of fascist characteristics in her book End of America. How many of these can we confirm:

    1- Invoke a terrifying internal and external enemy (CHECK )
    2- Create secret prisons where torture takes place (CHECK)
    3- Develop a thug caste or paramilitary force not answerable to citizens (CHECK)
    4- Set up an internal surveillance system (CHECK)
    5- Harass citizens’ groups (CHECK)
    6- Engage in arbitrary detention and release (CHECK)
    7- Target key individuals (CHECK)
    8- Control the press (CHECK)
    9- Treat all political dissidents as traitors (NOT THERE YET)
    10- Suspend the rule of law (ALMOST THERE – AFFLUENZA CASE)

      1. susan the other

        I think there is also a case to be made that we are under martial law restrictions; almost completely so because no progress is being made on anything and government secrecy is firmly established. When Hank Paulson threatened it, it had already been set in motion. Including the placement of the next “President.”

      2. John Mc

        Lambert, it does. Robo-signing is the perfect example. This is probably more of a function of a deficient background in law than sticking to a dying thesis.

    1. Banger

      I agree that all these things are present but I also believe they are unevenly used. I believe there are people like Snowden and others we don’t know about who are actively sabotaging the national security state. There is much more internal dissent in this area than most people think.

    2. JTFaraday

      I think a number of generally credible people have been promoting some version of this about the US for a while (and I agree), but the idea that liberals, per se– but not so-called “small government” American conservatives– are corporatists/ fascists probably goes back to Jonah Goldberg’s 2008 “smiley face Hitler” book, which was received as an anti-liberal smear job (and probably is. I skimmed it and decided it wasn’t worth reading).

      Although he doesn’t mention it, one suspects this is in the background somewhere for Konczal, and his persuadable target audience.

      It’s also entirely possible that those conservative partisans who are charging Obama with “corporatism” today will drop the charge when their guy is next in office. That does seem to be the way they operate. So, for them, it is a smear job.

      None of this is to defend Obama.

    3. bob goodwin

      I’m with Lambert. There seems to be three periods where Laws have been effectively ignored since the beginning of our country.

      1. Civil war (Habeus Corpus, Reconstruction)
      2. FDR (Federalizing state turf, Japanese internment)
      3. Bush/Obama (Finance, health care)

      The first two cases had good outcomes, and the supreme court let everything important happen despite clear law that said they shouldn’t.

      The last case we don’t know yet. Let’s at least hope that we return to a time where law is respected.

      (There have been many other cases where laws were broken, and sometimes got by with it. These 3 cases were idealistically motivated and very public.)

  9. pebird

    Konczal doesn’t like the reference to corporatism because the implication is that the US public might want to end this disgraceful period in the way that Italians ended Mussolini’s.

      1. McMike

        Yeah, too little too late though.

        Il Duce was lucky he did not have to live to see what his leadership led to – being on the wrong side of the World War was a Bad Move for Italy.

  10. ujustcanotstoplying

    Right about the democrat; wrong about the GOP.

    Reasonable proof please. How does the party of small government have anything to do with Fascist Italy?

    Hint: El Duce was a socialist, and he copied most of his notions from Wilson and the war socialist of Wilson’s Era.

    YOur assertions about the GOP are just pure propaganda>

      1. from Mexico

        And not that I buy into the deficit hysteria, but if we look at which presidents swiped the national credit card the most, it certainly was the Republicans:

        Republicans have consistently been the big borrowers and spenders. This undoubtedly has something to do with the Republican Party’s tax-cut theology.

        One of the most flagrant examples of policymakers working at crosspurposes was during the Reagan administration, where Reagan was running up unprecedented deficits at the same time Volcker was raising interest rates into the blue empyrean:

        I think Reagan and Volcker had one purpose and one purpose in life only, and that was to crucify labor while concomitantly throwing a lifeline to the people who count, that is rich people and the military-industrial complex.

        1. fresno dan

          Republicans BEING against deficits by DOING anything remotely effective to balance the budget is like….democrats being against the surveillance state (oh – they were against it, they just didn’t know about the surveillance?)
          Balanced budget is just republican campaign bull to get those who can’t be bothered by reality, which is a substantial portion of the repub voters.
          I don’t know if there is a secret club room where the Republicans and Democrats drink whiskey and smoke cigars, and laugh about the rubes – the republs bragging how they get the good old boys by defending Duck Dynasty, and the dems saying that that’s nothing compared to their twofer – super profits for hospitals, insurers, pharmaceuticals, and they get to look like they care for the poor … with the hilariously named AFFORDABLE Care Act. (I would say the dems are wittier)
          I kinda of think there is…

          1. different clue

            I remember reading an essay called In A Manner Which Must Shame God Himself in a book of Kurt Vonnegut essays called Palm Sunday something about where Vonnegut was invited to some get together of politicaly famous and powerful people . . . like J K Galbraith and etc. He wrote something like . . . ” whether one was a Democrat or a Republican was considered a hilarious accident which nobody was expected to explain.”

            1. skippy

              In the same vein – why do deity’s demand material objects of sacrifice and keep attendance records.

              skippy… kinda goes against the whole Omnipotent, Omnipresent, Omnibenevolence. and Omniscient theory methinks…

    1. Klassy!

      Please tell me more about this mythical creature called the “party of small government”.
      Now, if you’re talking about the GOP I can give you an example. I’m pretty certain that when it comes to law they prefer to use it to break the rights rather than protect the rights of labor.
      The Democrats prefer to sit on the sidelines.

    2. Vatch

      The party of small government? Hardly.The Federal budget grew from 2 trillion dollars to 3.1 trillion dollars during the George W. Bush administrations. The Patriot Acts, created and enforced by Republicans, serve as corner stones of fascism in America. Of course, Obama the liberal Democrat has continued these odious trends. Both Bush and Obama were and are fascists.

    3. McMike

      I love how you guys can get all confused just by the misuse of even a single word. Such as the word “Socialist” in the title of the Nazi party.

      I bet you buy a dozen boxes of anything that says “new and improved” on it.

      Here’s some advice: don’t look up in a rainstorm – you might drown.

      1. dSquib

        I think some people don’t understand that the word “socialist”, given its current disparagement, could ever, anywhere have had broad sentimental appeal; that any politician or party could use and, in the Nazis case, redefine to their ends.

    4. bob goodwin

      I am a republican and a libertarian. I was radicalized by the bank bail-outs. This was a clear cut case of undermining the law, blantant lying, and going against the deeply held American belief that capitalism was good, but only because insolvency led to the death of bad institutions. This is a really big turning point in the power of Governments, for me and many in the tea party. The split in the Republican party happened because Corporatism’s first big sin happened in the Republican party. I have been saying for 5 years that the worst two presidents since the Civil War were Bush and Obama. And many in the progressive wing are having similar feelings.

      The main difference between the progressives and the libertarians is which side to blame. One side blames the Goverations, and the other the Corperment.

  11. Klassy!

    I think when the right uses the term “corporatist” they mean “any government intervention in the market (that does not favor capital)”. The market has the answer if you just get out of the way. Where Konczal is wrong is that Obama is very much invested in market based solutions.

  12. ep3

    Yves, I want to step in for a second here and talk about the TARP compensation restrictions. Because you have only discussed those restrictions as they pertain to the banks. But remember that TARP applied to the GM/Chrysler bailouts. And what I want to say, that I see, is that the bailouts had two figureheads used as one. Banks on one side, automakers on the other. The restrictions were imposed AFTER the banks got their funds, but before the automakers did. Team Obama used TARP to further hurt the automakers while championing to the public that they had rules and restrictions on the borrowing of the funds. This further “destroyed” an industry that was the source of employment for millions of blue collar workers (as well as lead to the bankruptcy of Detroit). While Obama was supposedly holding hands with the UAW in one room, he was destroying their employer on the other. Remember that GM CEO Rick Wagoner (who was given the wheel to the titanic when he took over), received a hefty golden parachute for being fired. As you say, treasury helped banks repay their loans quickly to protect them from the TARP restrictions, while treasury squeezed the automakers tighter, thus forcing them into bankruptcy. The hope with the bankruptcy, from the automakers perspective, was that they could finally dump all their pension & health care obligations. But Team Obama could not withstand such a political hit. Thus, an agreement was made where retiree health care was put in the VIBA trust, which would manage the payouts, and be funded by one time contributions from the automakers (essentially depositing the funds onto the Titanic and then letting it set sail). I have mentioned this before in comments, but recall that the GM bailout totalled approximately $50 billion; the amount committed by GM to fund the VIBA: $50 billion. Another stealth bailout.
    I want to alter the subject here for a bit and discuss some GM things. After being one of the largest land owners in the country, GM perpetually contaminated the land and water surrounding these large factories. GM does not have to suffer any environmental liabilities as long as they continue to own the land (plus it props up their balance sheet). So as thousands of acres of industry “parking lots” set empty, our cities look like war zones.
    Just to sum up, Team Obama, as you say, let the banks do whatever with their TARP money. But Team Obama used the automakers as a publicity stunt, while continuing to destroy & offshore those solid blue collar jobs.

  13. steven

    The point of Konczal’s article was to describe the ways that the right wing co-opts and redefines concepts like corporatism, elitism and populism and then twists them into their opposite so that they reinforce corporatism and elitism and subvert the progressive agenda.
    Then, rather than locking onto this point, discussing it in further depth to help neutralize its effectiveness, and hammering it home you spend your time trying to prove that obama is the arch corporatist antichrist.

    Why are you letting your feeling of betrayal by the obama presidency distract you from the key point?

    1. McMike

      Well, indeed the right has done this to great effect, for a long time, but particularly for the last couple decades. To the point now that their rhetoric has descended into complete fourth-stage simulacra nonsense, and blatant serial self-contradiction.

      The problem is, in this case, the right is correct. Obama is a corporatist. The Democratic party is corporatist. So as far as I am concerned, let them go off a cliff together.

      The GOP will win back the WH soon, and then we can have fun watching the GOP pivot back on itself.

      To your point though, yes, NC goes after Konczai in pretty much the same way they went after Lakoff last week.

    2. dSquib

      The “point” of the article is distinct from the intention of the article, which is most likely to taint those criticisms and make anyone hesitant to make them from the left lest they be associated with the big bad Republicans, or worse the Tea Party. You see a lot of this when it comes NSA backlash stuff and any smidgen of Fed criticism.

      He used specific examples like Obamacare and alludes to QE, which Yves and others have clearly documented are corporatist in nature and execution, and derides criticism of them as hysterical.

  14. McMike

    You have to admit, the spectacle of the right pivoting to position itself as anti-corporatist, anti-bank, anti-surveillance, anti-bailout, anti-fascist, anti-deficit, and pro-medicare is actually pretty freaking hilarious.

    I mean, only in America – the land of perpetual upward-failing, re-re-self-definition, and collective amnesia.

    We got a preview of this after 9/11, when they ran around decrying the Islamist flavor of theocratic fascism, in total earnest hysteria, without the slightest hint of self-awareness, let alone irony – even at the very moment the right was embarking on a massive social jihad and building a hugely expensive national security state without restraints.

    If you step back and watch for a minute, it’s actually pretty funny.

    1. Banger

      McMike, you can’t describe the right so simply. The actual views out in the real world in a good part of the rank and file right wingers is very anti-authoritarian. People like Alex Jones and others represent this view–mind you, their views are very contradictory but the mood is there. It could morph into something unpleasant and chaotic or something relatively benevolent. It’s worth looking into because there is a lot of dynamism in that area at the grass roots of the American proletariat.

      1. from Mexico

        That is a highly bowdlerized portrait of the right.

        In American Theocracy, Kevin Phillips notes that on the right “three pillars have become increasingly central: (1) the oil-national security comples, with its pervasive interests; (2) the religious right, with its doctrinal imperatives and massive electorate; and (3) the debt-driven financial secotr, which extends far beyond the old symbolism of Wall Street.”

        Of these three, the religious right is by far and away the largest. “[W]e can all too plausibly contemplate a recent watershed in which fundamentalist and evangelical churches play the dominant organizational role in supporting the Republican party that other groups — business, labor, farm, pro- and antislavery — enjoyed in earlier presidential cycles,” Phillips notes.

        As a gay man who has fought the religious right in the trenches, I can tell you from experience that those who make up its membership are not anti-authoritarian. In fact, they are theocratic, and many fanatically so.

        1. bob goodwin

          “As a gay man who has fought the religious right in the trenches, I can tell you from experience that those who make up its membership are not anti-authoritarian”

          You fight a different group than I belong to. Even in deep blue states there are a lot of republicans. Most republicans are more mad at their own party for corporatism than democrats are mad at their own party.
          Most of the religious people I know are becoming more liberal than the average person, which is a new thing, and may be evidence of how helpful the Gay rights movement was to our culture.

          It is your assertion that the average Republican is driven by one of three interests (oil money, religious social engineering and wall street) is ludicrous. The conceit of the left to believe this is strange.

          What is undeniable is that parties get captured by interests. And if this was your point, I agree. Oil, religious social engineering and wall street have disproportionately captured the Republican party. But the hold is weaker than the lawyers and doctors and wall streets capture of the Democratic party. This is why we are seeing the Tea Party forcing the republican party to a purity, and end the collusion between the neocon Republicans and neolib Democrats.

      2. McMike

        Agreed that I take certain shortcuts and generalizations in writing blog comments.

        Agreed also that the right is not nearly as monolithic as it was during the Bush administration – which had nearly the entire right bleating in perfect unison in favor of everything Bush did, up to the moment he rescued the banks on his way out the door.

        Agree also that certain elements of the actual grassroots right is starting to cope with some cognitive dissonance.

        And agree that it could break either way. But I tend to suspect, based on history, that the right has a far higher chance of falling in behind a “corn-pone” Hitler, as they do following some other path.

        Over time, the right-side grassroots has been conditioned to be mainly anti-left/anti-“other” before anti-authoritarian, so anti-authoritarianism tends to lose out every time to expediency in the face of some existential threat or another from outside the tribe. Face it, it’s a lot like Lucy & Charlie Brown and the football.

        I suspect this anti-authoritarian phase has as much to do with anti-Obama marketing, and a particularly bad run of idiots for the GOP, as it does any deeper meaning ideologically. Which means that when President Wingnut takes over the WH in 2016, all this grumbling from the right will cease overnight. And they will fall right back in line endorsing whatever crazy stuff the GOP dreams up, regardless of what was supposedly important during the Obama administration.

        1. Banger

          I’m fairly optimistic and feel that it will bounce on the relatively harmless side of the fence. I see more danger from the center and its tendency to like police state methods.

        2. jrs

          The terms are far too broad, suffice to say that the right economic position applied in thinking about the real world (not in libertarian economic hypotheticals that posit there would be no unemployment or poverty without government or something) but a right perspective on “who gets what” applied to the actual world reveals profound authoritarian sympathies. It’s economic obedience or you deserve to starve. This is authoritarian as all get go. And it’s the root of it. So the right as anti-authoritarian? No. They talk a good game, but that stuff is not the thinking of anti-authoritarians.

          1. jrs

            Btw I’m naive sometimes and take what people say at face value. If they claim they are on the right because they are worried about government overgrowth/overreach/dominence whatever, I might think they are misguided in how they apply it (social programs?), but at least I tend to think they are sincere (talking about ordinary people here not the .1% who obviously are all about their class interest).

            And then I find out they think Snowden is a traitor who should not be granted amnesty, and never even mind what they think of Manning. And I have to revisit. Because those seem pretty clear litmus tests for authoritarianism to me. If your rightists think Snowden and/or Manning are traitors, they are not anti-authoritarians

            And then I think ok so if being conservative is NOT about some dubiously guided quest for freedom (which it genuinely IS for some libertarians) what’s it really about? Economic authoritarianism. It’s about how people should be dominated by the economic system.

            1. bob goodwin

              In my circle of friends, it the is conservatives who are more likely to support Manning and Snowden. I split the difference, in that I think that civil disobedience needs jails. I am happy to put Nelson Mandella, Snowden, and Kevorkian in that category, because they all were willing to use their flesh as a weapon for righteousness against power.

    2. fresno dan

      The republs are getting awfully close to the George Costanza “do the opposite”
      I’m thinking if Obama wanted single payer health care, he should support a law that would OUTLAW such a proposal, and there could be NO cost saving provisions, no open bidding for drugs, mandatory cost escalating provisions, services only by monopoly, etcetera, and no government participation.
      But of course, that is silly….cause Obama no more wants to constrain corporate price gouging that the repubs…
      For good measure, Obama could support Christmas, Jesus, and apple pie. Republs would be forced to endorse Satan, Black Sabbath, and broccoli.

      1. Ulysses

        I had never thought of broccoli as apple pie’s opposite before. Makes me wonder what’s the opposite of baseball, hotdogs, and Chevrolet? Are you one of them soccer loving, tofu-eating, Peugeot-driving libruls?!?

  15. Banger

    Good points. If anything the DP under Obama has drifted very far to the right pretty much knocking the RP off the mainstream right–the only place to for them is into very strange places no major party has gone. I don’t understand if the RP is a Conservative party or a party of vandals and nihilists–their leadership is very bizarre–though the leadership seems to have rebelled recently probably because the corporate oligarchs see the Tea Party and the chaos they seem to want as more dangerous than the morally bankrupt DP.

  16. canaille obedience training

    Konczal understands perfectly well the origin and substance of your corporatism argument. He knows it’s bedrock bipartisan consensus, or else he would never appear in the New Republic. Konczal’s goal is very simple: smear the idea with the “right wing” label. That way all his partisans will stiffen up with reflex dismissal when they hear the word.

    So stop with your inductive logic and rigorous habits of mind, you silly eggheads, Konczal’s writing propaganda for dopes!

    1. scraping_by

      True it’s propaganda, the Big Lie, redefining words into oblivion, all that.

      But the idea of ‘Don’t wrestle with a pig’ just means pigs get a free ride.

      It’s like Godwin’s Law; ever notice how that favors Nazis?

  17. clarence swinney

    President 2016
    Your guess?
    I am betting it will be a Democratic Three Way Race between Clinton-Kerry-Gore.
    Gore won and was cheated out of the office.
    Kerry won and was cheated out of the office.
    Electronic counting rigged.
    I voted for Kerry and on Review it came up Bush.
    Republicans will run Jeb Bush. He has the best credentials.
    Go to paper ballots and hand counting to stop cheating with computers.

    1. Brooklin Bridge

      It will be a race between Hillary, Buffoon 1, Buffoon 2, …, Buffoon n. An example of Buffoon would be Biden of course.

      Kerry and Gore are perceived as 1st string and it’s unlikely they will be allowed to interfere. One of them might win and they would not have the same weight as “the first woman president” needed to continue the betrayal where Obama leaves off. TPTB are in deadly earnest now. They WANT SS and Medicare. They can taste it. And they have seen first hand what a slick Trojan horse like Obama can accomplish.

  18. Waking Up

    Thank you for the “investment theory of politics” link with the review on “Golden Rule” by Thomas Ferguson. It has sparked my interest on reading additional information on Adam Ferguson (1723–1816), the philosopher-historian of the Scottish Enlightenment, a contemporary of Adam Smith. As mentioned at the review, “his two major works, Institutes of Moral Philosophy (1769) and Principles of Moral and Political Science (1792), are in several ways superior to Marx’s better-known writings nearly a century later.”

  19. Hugh

    I had various reactions to Konczal. The first is the Big Lie. People may suspect that you are lying if you shave the truth, but tell a big enough, in your face lie, and they will think that it has to be mostly true because you wouldn’t dare tell what would otherwise be an obvious lie. And at the minimum you must believe it and be acting in good faith for the same reason. Here we are suffering through the largest financial frauds in human history and the depression that resulted from them, and neither the frauds nor the depression have been seriously acknowledged. The frauds and the fraudsters have gone unprosecuted. Every effort has been made to concoct “settlements” to immunize the financial sector from their frauds at pennies on the dollar. At the same time, no effort has been made to make their victims, numbering in the tens of millions, whole. This is what makes Knoczal’s lie a Big Lie. It writes off the last six years as if they never happened and ignores the 35 years of bipartisan out of control corporatism that preceded them.

    Another related reaction is that this just highlights Konczal’s kneejerk Democratic tribalism. Our media and elites have expanded on the Big Lie by turning it into an oft used fixture. In so doing, they have created a complete alternate universe discourse where the Big Lie hardly stands out. It’s the norm. Hannah Arendt would recognize this as a variant of her concept of the totalitarian fiction. Konczal and his class are arguing in a world that doesn’t exist. Unfortunately for us, they are pushing policies on us, admittedly policies which serve their interests entirely, based on these fictions.

    Finally, I was reminded of the old legal saw that if the law is on your side, pound the law, and if the law is not on your side, pound the facts, and if neither the law nor the facts are on your side, pound the table. This is another aspect of the alternate universe our rich and elites inhabit and seek to foist on us. If you do not buy into it, it’s all noise all the time. Scattered concepts, like “corporatism”, will pop up from time to time in this witch’s brew but there is no coherence to them, no cohesive explanation, and they are, as here, just as likely to be used opposite to reality as in line with it.

    1. different clue

      I heard a simpler version of that once. If the law is against you pound the facts. If the facts are against you pound the law. If its all against you pound the table.

  20. Dan Kervick

    I think we need some more precise definitions here, or else the discussion will just degenerate into unresolvable name-calling. Since the dawn of capitalism there have been close partnerships of various kinds between governments and private sector companies, and close back-scratching ties between government officials and powerful capitalists. If we are going to call all capitalism “corporatism” now, well OK. But then we need a different term for “Mussolini-style corporatism” if there are some important differences between the economy under Mussolini and the economy under capitalism in general.

    1. Banger

      Makes sense–we are very poor at defining things. I see very little similarity between our situation and Mussolini’s Italy. Yes, rich f!cks fraternize with gov’t officials all the time in every society or they are one and the same–it means nothing. The issue here is not whether we are moving towards Italian fascism but how the system has been systematically gamed at all levels by people who live to achieve power and wealth–and much of that is fairly plain to see–we have deconstructed much of that. Now we have to talk about what to do about it–to do that we have to have a realistic view of politics which I don’t see much of on the left.

    2. MaroonBulldog

      Karl Marx himself defined a “corporatist” republic as a one in which persons were represented as members of particular economic classes, in contrast to a “democratic” republic in which persons were represented as individuals. Mussolini’s fascist state was designed to operate as a “corporatist” state so defined. The United States has become an administrative state (or three) in which the real laws and adjudications are made in regulatory and welfare agencies that are chartered to address (or negotiate) various class interests. It proceeds according to rulemaking procedures that are undemocratic in two senses: the results are not determined by voting, but by corrupt bargaining; and the democratically elected officials do not exercise authority over the process, but surrender authority through delegation. That is how I understand corporatism in the comment I left below.

      One feature of Mussolini’s corporatist state is the disconnection between ownership and control of business assocations, since business associations nominally continued to be privately owned while control was exercised by managers and state officials that were beholden to (and captured by) each other. Early in the 1930’s, Berle and Means published the first edition of “The Modern Corporation and Private Property,” which recommended a similar course for the United States. This book, largely forgotten now, was quite influential among the lawyers and economists who helped design the modern American administrative state.

    3. Hugh

      I often write that the three great issues of our times are kleptocracy, wealth inequality, and class war. I think the argument can be made that when capitalism is left to its own devices this is what it evolves into. It is why capitalism should never be left to its own devices. Corporatism is criminal by nature, a vehicle for looting. Democrats and Republicans are equally corporatist. It’s just that their corporatism manifests in slightly different ways.

      I also write a lot about the society we wish to have, and how we are to achieve it. This defines our social purposes, and we can measure alternate concepts like corporatism against them. It’s not hard to see that corporatism is antithetical to any kind of fair, just, and equitable society.

    4. bob goodwin

      I don’t feel the dissonance you state. Moussolini was a fascist, and in that sense I do not think the Bushbama is fascist. Corporatism as a theme is very apt in todays situation. FDR nor Hoover were trying to use large institutions of America to change the economic or social character of the country. They simply weren’t. They were both trying the change the government and policy towards those goals.

      Technology companies have HUGE lobbying arms in Washington. To what aim? Are they regulated too heavily? Are their international tax havens too difficult to bear? No! But AT&T, and IBM and Microsoft (note all were tech companies) were squished by the government. But Google is not. The difference? Corporatism.

      What industry does not owe its existential existence to a tight coupling with government? Healthcare, Finance, Automotive, Natural Resource extraction?

  21. Fair Economist

    If you call the current Democrats “Mussolini-Style” Corporatists, you show you know very little about Mussolini. Call me if Obama starts assassinating members of Congress. Not gonna happen.

    Also, it’s not accurate to call the Democrats corporatists. Most Democratic voters and possibly even most Democratic Congresspeople aren’t. But the nature of a two part system generally makes parties propose the policies of their centrist wings, and that is corporatists, albeit relatively benign ones, for the Democrats.

    Even W and Cheney weren’t “Mussolini-Style” corporatists even though they were a much nastier brand of corporatists than the right wing of the Democratic party.

    1. MaroonBulldog

      Actually, even though you don’t define what “corporatism” is, or isn’t, and I do, I kind of agree with your observation. Democrats don’t think of themselves as corporatists or fascists; neither do Republicans think of themselves that way; both would take great umbrage if you called them by those names.

      But I am less concerned about how our officials think of themselves than I am with what they do, and what they do is exercise the levers of political machinery designed and built along corporatist lines of thought back in the 1930’s and 40’s.

      Your comment about political killings is gratuitous. Fascism is not primarily about political killings, any more than Communism is about Stalinist tactics. The Chinese are not practicing “thought reform” or reenacting Mao’s cultural revolution any more, but their nation still avows itself to be Communist.

    2. jrs

      To some extent but you missed the point of the article here:
      “But the nature of a two part system generally makes parties propose the policies of their centrist wings, and that is corporatists, albeit relatively benign ones, for the Democrats.”

      They are not policies of some “centrist wings”, they are policies of the corporate interests that have bought the politicians. It’s not about centrism, it’s about paying to play. What corporatist interest want is generally framed as being “centrist” for the masses of course. And the Democratic corporate interests are not benign: intellectual property backs them primarily, even banking does. As best the Republican corporte interests may be even worse: fossil fuel etc..

  22. thelonegunman

    as if the patrons of free-give-away to drug companies painted as medicare supplement B (which is a massive gouge on seniors) or defense contracts to president cheney’s halliburton (we could go on for quite a while) are not corporatists themselves
    (‘we’re shocked shocked! there’s gambling here!’)

    1. MaroonBulldog

      I missed your comment while posting mine, in which I discussed “corporatism” as manifested in the administrative-regulatory state. Your comment actually reminds me that the there is more to the story than that. The corporatist administrative state actually has two other branches. Medicare Part D manifests the administrative-welfare state. Haliburton contracts manfiest the administrative-procurement state, AKA the military-industrial contract.

  23. MaroonBulldog

    The Democrats and Republicans both manifest themselves as “Mussolini-style corporatists” because they engage in a competition to control the offices of an administrative regulatory state that was designed according to principles inspired by Mussolini-style corporatist thinking. The “constitutional” foundations of this state were laid in Supreme Court decisions from FDR’s days, and the edifice was erected in 1946, with the enactment of the Administrative Procedure Act. This might as well be entitled the Regulatory Capture Enabling Act–it is designed to ensure that economic regulation is mediated through undemocratic rule-making procedures negotiated for the benefit of the industries affected. The Democrats and Republicans are just seeking to take full advantage of the corrupt bargaining opportunities that this system offers them: witness, Dodd-Frank, ACA, and all their delegations of rulemaking authority.

  24. Chauncey Gardiner

    … “porcine maquillage” … so much softer than “Lipstick on a Pig”…. Gawd, I Luv It !!

  25. Jim Shannon

    The proof is everywhere you look! The 1% clearly control governemnt and those at the Top have it ALL because they write the TAX Code to benefit themselves – period!!!!!!!!
    Tax ALL Net Worth above $10,000,000 at 100% and you will level the playing and give the 47% some hope for a better life!
    Pass it on!!!!!!!!!!!!

  26. Gentlemutt

    Yves, question for you based on this sentence:
    “Bill Greider reported in his book Secrets of the Temple that Volcker carried an index card where he kept track of weekly construction worker wages and regarded them a key indicator of whether his effort was working.”

    I did not read Greider’s book, and so don’t know if he went on at length about Volcker’s stance on labor unions so as to make this question moot. That said, is it possible Volcker was tracking construction worker wages in aggregate to learn whether his policies were slowing down the entire economy and hence slowing down inflation?

    I ask because Mr. Volcker’s conduct in general has not given me the impression he somehow loves corporations more than the people who work for them, and he certainly has not appeared to enrich himself on the back of his government service, a pretty reliable sign of the corporatist mentality in all its glory.

    1. Yves Smith Post author

      Volcker is not on your side. He was most assuredly pro-capital and anti-labor.

      I have not been able to find the source, but during the period when he was letting interest rates go to the moon, he said that unions needed to “get the message”. On another post today, a reader provided a long quote from Volcker saying that Americans were going to have to accept a lower standard of living.

      Now he did and still does think banks should stay simple and kinda dumb and be regulated forcefully. But that’s a different axis from this view on labor.

  27. F. Beard

    But now I want to come back as the bond market. You can intimidate everybody. James Carville

    It’s a bluff since a monetary sovereign has no need to borrow in the first place. But no wonder since banking has always depended on deception, being inherently dishonest (e.g. “Your deposit is available on demand even though we lent 90% of it out”).

  28. scraping_by

    Konczal is engaging in a little propaganda ploy beloved of the current generation of unreality creators. Unrealitists?

    He’s starting to redefine a word away from what it really means to something quite slanderous.

    For example, the right wing noise machine has a lot of its sock puppets, and after then, stooges, defining QE as Keynesian. Keynes never proscribed giving wealth to the wealthy to begin the money flow. He was pretty adamant about money to the middle and working classes. Everyone hates QE, therefore everyone should hate WPA style capital projects that put people to work.

    The New Deal idea of government regulating capitalism used to be the Democrat’s response to ‘Life is Unfair.’ It was one of the central ideas of the party. Now, of course, the old Labor social democracy Democrats have been pushed aside for PC hedonist diversity Democrats. The PCs are indifferent to the economic arrangements, and using government to promote industries and individual businesses works as well as anything.

    Of course, it should be controlled by the business interests, since they know what they want. And, you have corporatism.

    Using government to defend citizens against capitalism’s ugly side is far different from corporate controlled subsidy activism, but if Konczal keeps repeating it, backed up by the sock puppets, followed along by the stooges, someday most people won’t know that.

    1. scraping_by

      Should have read the article more closely. While Mr. K notes, at length, the right wing noise machine’s debasing the language, making the word mean something it doesn’t, he gives Barry and company a free ride by stopping there.

      With an accurate definition of corporatism, you’d have to engage in a lot of looking elsewhere not to see it fits current administration. Pretty much down the list, that one.

      In other words, the right’s lying about Barry’s corporatism. Mr. K’s lying about Barry’s corporatism. The insiders agree about letting the truth out to the rest of us.

    2. Klassy!

      But it might also be helpful to check out how the right is defining corporatism. I read one of the links to red state. It was a multi part article, and I only read the one linked to, but they defined corporatism as big labor, big business, and big government all sitting at the table, implying that all are equal. In the redstate conception of the word, their true heroes– small businesspeople are frozen out. And, as Konczal correctly states, they insist that the market cannot work its magic.
      Anyway, to me the big whopper of Konczal’s piece was the statement that the Fed is interested in promoting full employment (limits to the Fed’s ability to achieve this aside.)

    1. Ulysses

      Agreed, but the Eurocentric attitudes of many Americans means they at least have a vague notion of who Mussolini was, while they have nary a clue what “zaibatsu” means.

  29. MaroonBulldog

    If Mussolini is not the best fit, I think “Peronista” is a better fit than “Zaibatsu”, at least as regards the current administration. “Peronista” connotes a form of corporatism that is vaguely defined and not thought through, less self-aware than Mussolini’s.

    1. JTFaraday

      For an analogy with our situation today– and if you can read past the “socialist revolution now!” rhetoric– I kind of like the Marxist R. Palme Dutt’s explanation of fascism in Fascism and Social Revolution (1936), which sees the rise of fascism as a response to a large scale crisis in capitalism.

      Here’s a very brief summary:

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