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Yves here. Rob Urie was kind enough to provide us with a fundraiser post of sorts, so please thank him (Lambert’s Mr. Subliminal: And please make a detour to the Tip Jar if you haven’t yet!). It is too bad that the Red Scare of the 1950s also made socialism into a bad word for most people, even though the American economic system then, with its very high income tax rate and New Deal social programs, was well on the way to being European-style social democracy, and the Great Society programs of the 1960s moved it further in that direction. Having said that, during the Sanders campaigns, polls found a majority of young adults and teenagers approved of socialism. I confess I have not tracked more recent surveys to see if the rising voter cohort holds now holds similar views.
A major focus of this post is how de-industrialization has shaped politics in America.
By Rob Urie, author of Zen Economics, artist, and musician who publishes The Journal of Belligerent Pontification on Substack
The nature of the American political system is often hidden behind theories of how democracy works. In these we, the people, choose politicians to represent ‘our’ interests within the realms of government, foreign affairs, and commerce. In contrast, at least according to the annual polls conducted by the Alliance of Democracies, fewer than half of Americans believe that the US is democratic; is a democracy. The reasons given against the US being a democracy are 1) corruption (73%), followed by 2) corporate control of the political system (72%). In other words, the reasons for this missing democracy are economic.
From the advent of neoliberalism in the mid-1970s to today, the US has been systematically deindustrialized. Capitalist industry has been the motivation for much modern political theory, fostering explanations of capitalist production such as ‘economics,’ as well as competing systems of political economy such as socialism, communism, and fascism that constitute the fault lines claimed to motivate geopolitics and wars. The deindustrialization of the US undertaken from the 1970s forward punished workers in the ‘old economy’ while directing Federal largesse toward favored industries such as finance and technology.
The ideological explanation for this shift was ‘markets.’ The US is subject to the immutable laws of nature, went the claim. Economic relations are subject to these immutable laws (continues the logic). There was therefore little that the American political and economic leadership could do in the face of ‘nature.’ That deindustrialization was undertaken at the behest of connected industrialists to break the back of organized labor was left out of this explanation. Likewise, Federal largesse toward Wall Street and Big Tech represented the evolution of markets which Wall Street existed to support, and which Big Tech sold into. In other words, markets uber alles.
Graph: the ‘enemies’ of the US (in red above) have a freakish, even preternatural, propensity for possessing large oil reserves. As if this weren’t bad enough, five of the ten nations with the largest oil reserves have ‘authoritarian’ leaders who tend toward insanity, if you believe what the CIA has to say about it. That the Americans are willing to slaughter a few million innocents abroad to control oil supplies begs the question of how many Americans they would be willing to kill to do so. The most likely answer given the substance of this essay? All of us. Source: worldometers.info.
In fact, the mercantilist relationship between the Federal government and favored industries represents capitalism in its truest form. Markets are a distraction; a misdirection with a purpose if you will. Deference to nature obviates class conflict by ‘naturalizing’ ruling class dominance. Sure, the Federal government supports some industries while crushing others according to the whims and wishes of corporate executives and oligarchs. But little Jimmy-Sue’s choice between a can of soda and a candy bar (‘micro’ foundations) explains the emergence of the union movement in nineteenth century Europe, runs this implausible logic.
The irony that the political class was selling the magical qualities of markets both going into the Wall Street bailouts of 2008 and coming back out of them illustrates the political use-value of economic misdirection. ‘Markets’ would have meant the demise of Wall Street and the American auto industry around 2008 had the Feds not intervened. Then consider the politics. Half of the US workforce had been cut loose and left to its own devices through deindustrialization while the other half was subsidized through Federal largesse for favored industries. How plausible was it then that ‘markets’ explained the mercantilist policies of neoliberal governance?
As the geography of economic production had it, from the start of the American industrial revolution until the 1970s, industry had been widely dispersed across the US. For better or worse, it represented the ‘structure’ of capitalism, providing livings for industrial workers who in turn supported local businesses, towns, cities, and ultimately the Federal government. The motive for deindustrialization was to crush labor unions, eviscerate environmental standards, and establish a center – periphery relationship (imperialism) with the rest of the world. Before 2007 or thereabouts, this program remained vaguely plausible to powerful constituencies.
The political divisions of 2023 follow the basic contours of these manufactured economic divisions. Deindustrialization gutted the heartland while Federal support for favored industries benefited large cities and suburbs. The prior group had been poorly served by the American political establishment while the latter group had its fortunes raised by it. The prior group turned away from the urban liberals who crafted these policies for their own benefit, while the latter group could not, or would not, admit its own role in ‘managing’ the transition away from industry. Intellectual honesty isn’t the strong suit of the technocrats of megalomania.
The class dynamic that was created was of urban and suburban workers in these Federally supported industries prospering while workers in the ‘old’ industries that had built the modern capitalist world were left to compete for jobs that don’t pay. Those who have seen the labor documentary Harlan County, USA, will recall articulate, anti-capitalist, coal miners in a battle against armed Pinkerton strike-busters and the state police. The miners’ explanation of ‘gun rights?’ To keep the Pinkertons from slaughtering them with impunity. The result in 2023: an urban bourgeois that ‘loves’ labor but that hates workers.
This dynamic can be seen in the enthusiastic disinterest that urban liberals have in labor issues beyond lip service. Joe Biden calls himself a ‘labor President’ while he has perpetuated the urban, bourgeois, war against displaced industrial workers. For instance, Mr. Biden promised to raise the minimum wage and then reneged. He promised to support labor activism and then crushed the railway workers’ strike. More recently, he reneged on the ‘just transition’ previously embedded in his environmental proposals in favor of the direct transfer of tax credits to corporate coffers. While the lip service suggests ‘liberal,’ Mr. Biden’s actual policies are neo-fascist.
Mr. Biden’s supporters contend that he, and they, are passionate about labor issues even though they conspicuously loathe actual workers. The propaganda and censorship industries now being supported by liberal Democrats target ‘extremists’ who are overwhelmingly refugees from the deindustrialized heartland. That half of the nation had their livelihoods destroyed by the neoliberal ‘center’ suggests that political dissolution was the goal of deindustrialization. Missing as explanation is the utter stupidity of the people now running the US. Joe Biden voted to admit China to the WTO (World Trade Organization). He is now trying to launch a war against China over the consequences of his own policy. Many of us knew better at the time.
Graph: American healthcare policy is substantially run by urban. liberal, technocrats. After decrying the Trump administration’s seeming indifference to the consequences of the Covid-19 pandemic, these technocrats adopted his libertarian posture as they fixed their pandemic response around the election schedule of Joe Biden. That Biden’s Covid-19 response was likely the worst in the world— 50% more Americans died from Covid-19 under Biden than Trump, is considered a problem of ‘messaging’ rather than substance. If the US really wanted to destroy Russia, why not send the American healthcare establishment to ‘help’ with its pandemic response? The entire nation would be dead in a week. Source: statista.com.
Reneging on the ‘just transition’ is especially pernicious as it was intended to elicit support for environmental policies by subsidizing displaced workers during the transition to less destructive energy technologies. After all, the Federal government thought nothing of shoveling tens of trillions of dollars in Federal largesse to ‘save’ Wall Street from its own dysfunction. Were Mr. Biden’s urban, bourgeois, supporters aware of the Federal aid dispensed during their own economic transition, they might understand the contribution to economic and political stability that the Federal government has occasionally brought about. But it is a political error to leave Federal spending to a captive political system. The interests of the people need to be re-asserted.
Following the 2016 election, the class divisions between displaced industrial workers and those laboring in the Federally subsidized ‘new economy’ were brought to the fore. The urban bourgeois imagined themselves to be the masters of their own fortunes as they benefited from Federal support for favored industries. Surveys taken around 2008 found cogs in the Wall Street wheel who were convinced that their paychecks matched the social value of their production. Sure, bond trading paid poverty wages before Wall Street was liberated from social accountability, but what does that have to do with them, runs the logic? This inability to see which social levers are being pulled and by whom would be heroic if Prosperity Theology hadn’t beaten then to the punch.
This isn’t to suggest that these urban, bourgeois, bureaucrats for capital have easy lives. The inability of capitalism to produce enough ‘good’ jobs for those who want them means that precarity rules lives and psyches. Following graduate school, I didn’t dare take a vacation for fifteen years. The word from management at the time was ‘if we can do without you for a week, we can do without you forever.’ (This was considered a very ‘good’ job). While the Covid-19 pandemic has now apparently killed or disabled enough workers to cause a labor shortage, this is hardly the ‘nature’ to whom economists so regularly refer.
Graph: what disaster has the American political class wrought? Beginning in the early 1980s, life expectancy (at birth) in the US began falling relative to similar nations abroad. Americans now live 6.3 years less on average than the citizens of France, Britain, Canada, and Australia. In a functioning society, this alone would motivate a revolution. Following the passage and implementation of the ACA (Obamacare), this disastrous result got even worse. Notably, the American Congress has its own healthcare system. They know better than to cast their lots with the ‘little people,’ formerly known as ‘citizens.’ Source: worldbank.org.
American liberals have assumed that the majority view that the US isn’t ‘a democracy’ is related to the 2016 election and its aftermath. In fact, subsequent polling hasn’t materially shifted this result. Moreover, the AoD poll results tie to those of other well-regarded polls that go back years. Ousting the liberal’s bete noir in 2020 didn’t result in a plurality of Americans suddenly believing the US to be democratic. This makes sense given the explanations of bipartisan corruption and democracy-suffocating corporate power offered. What they suggest is that without taking on corruption and corporate power, there is little hope for American democracy.
This social logic should in theory give solace to Left political movements and parties. Corruption and corporate power are endemic to capitalism. However, via the umbilical cord that ties the American Left to the Democratic Party, the results are perpetually placed within the frame of party politics. Forgotten is that prior to 2016, political difference emerged from different premises about the world. Republicans supported what they believed to be the capital accumulation and allocation functions of capitalism, while Democrats claimed that these had to be managed by the state to function well.
In the brief interregnum between the 2020 campaign and the introduction of the Democrat’s policy proposals, substantial bytes were spilled 1) admitting that liberal Democrats bore significant responsibility for the election of Donald Trump via their economic policies, and 2) that lessons had been learned and the mistakes of the past wouldn’t be repeated. Missing is that the national Democrats saw this as a problem of ‘messaging’ rather than substance. Again, these are extraordinarily not-bright people. If they were paid based on ‘merit,’ they would be paying us to employ them.
In fact, the alliance between liberals and capital long ago eliminated the ‘opposition party’ frame of American politics to create a ‘uniparty.’ From the start of the post-War period through the election of Jimmy Carter (1976), the reforms of the New Deal kept capital in check with respect to corrupting American politics, domestically at least. And while liberals tie the start of ‘money in politics’ to the Citizens United Supreme Court ruling, the Supreme Court wouldn’t have ruled as it did had capital not already controlled domestic politics. The liberal conceit that Democrats oppose the Citizens United ruling conflates empty posturing with principled opposition.
The ‘opposition party’ frame that had mimicked mediation between labor and capital was abandoned in favor of both parties seeking the favor of capital. The logic is both simple a corrupt. Wall Street was given the ability to create money via the capital allocation function. While government could likely do a better job of it (bankers lend against collateral, not business plans), ideology trumped both history and common sense to place the function with ‘private’ bankers. Surprisingly (not), these bankers began keeping more and more of the money they created for themselves.
Illuminating the depravity of late-stage capitalism is a fools errand without alternatives. The US— Left, Right, and Center, is beholden to the logic of capitalism. The ‘Left’ response to the failure of Covid-19 mitigation policies has been libertarian, not ‘Left.’ Lest this come as a surprise, libertarianism is the ethos of capital that claims that corporate executives and oligarchs should be ‘free’ to exploit labor, pollute with impunity, and cheat on their income taxes. It is the ethos of unaccountable power. It is approximately as compatible with Left politics as European fascism of the twentieth century was. The point: the US desperately needs Socialist and Communist political alternatives. Deference to libertarianism will leave fascism as the only ‘logical’ alternative.