19 TECHNOLOGY AND MONEY: THE MYTH OF NEUTRALITY
I recently heard a television network official assert that technology is inherently neither good nor bad; it can be used for helping or harming society. He voiced this notion with such authoritative insistence that one would think he was the first to have thought of it. In fact, many people hold to this view, and they are just as mistaken as he.
Only when one speaks hypothetically does technology achieve neutrality: “It could be used for good or it could be used for evil.” Such unspecified references to how it could be used overlook the reality of how it actually and regularly is used. The truth is, technology is “neutral” only when conceived in the abstract, divorced from the social context in which it develops. But since it actually develops only in a social context and since its application is always purposive, then we must ask, Cui bono? Who benefits? And at whose expense?
Technology in the present social order is used mostly to advance the interests of the higher circles. New advances in technology are not neutral things; they sometimes impact upon us, our communities, and our environment in hurtful and regressive ways. Consider a recent example of how technology has been used to maximize corporate earnings. Monsanto Company spent $500 million to develop bovine growth hormone (BGH), a “wonder drug” that induces cows to produce abnormally high amounts of milk. The drug is causing serious illnesses and greater health maintenance costs for dairy herds, and increased feeding needs and animal waste runoffs that further damage the environment. The cows suffer from infection and malnutrition and must be given even more than the usual ration of antibiotics, all of which gets into the milk we consume. The long-term effects of BGH are not known, but it is suspected of having carcinogenic effects.
The increased milk production induced by BGH is costing taxpayers $100 million a year in additional federal surplus purchases, mostly benefiting a few giant dairy producers and, of course, Monsanto. So here is technology used for “good” (increased production of a food) having predictably bad results for the cows, the environment, the federal budget, and perhaps millions of consumers.
The same can be said of all of the genetically modified seeds and crops marketed by Monsanto and other such companies: they benefit a few giant producers, drive small farmers into destitution, undermine the natural diversity of products, and will likely cause problems for those who regularly ingest the Frankenfoods that are produced.
Developed within an existing social order that is dominated by big government in the service of big business, modern technology takes a form that perforce favors the well-placed few over the general populace. Today much technical research and development is devoted to creating weapons of destruction and instruments of surveillance and control. When over 75 percent of all research and development is financed in whole or part by the Pentagon, then it is time to stop prattling about technology as a neutral instrumentality and see how it takes form and definition in a context of money and power that gives every advantage to the special interests of the military-industrial complex, the profit-gouging defense industry, and state agencies of control, coercion, and surveillance. Meanwhile, the rest of us, the ordinary taxpayers, pony up the funds to pay for it all, while suffering the consequences.
The same myth of neutral instrumentality is applied to money itself. When I studied economics in school I was taught that money was “a medium of exchange.” Such a nice neutral-sounding definition hides a host of troublesome realities. In fact, money circulates within a particular social context. Like technology, money has a feedback effect of its own, advantaging the already advantaged.
Money creates a way of liquefying and mobilizing wealth, expanding the impact of its power. With mobility comes greater opportunities for accumulation and concentration of riches. Before money, wealth could only be accumulated as realty (land and edifices), livestock, horses, gems, furs, finery, spices, and the like. The advent of precious metals was the first great step to a mobile form of wealth that allowed for greater fluidity and accumulation. As any banker can tell you, money is not just a means of exchange but itself is a source of wealth and accretion, and not just a source but the ultimate end of all corporate production and transactions.
With the growth of wealth and the emergence of a moneyed class there comes a greater concentration and command over technology by that class. In a word, big money finances big technology. No wonder that technology, in turn, is developed with an eye to enriching and making the world safe for those who have the money.
What if, instead of defining money in that benign and neutral way, as “a medium of exchange,” we defined it as “an instrument for the mobility and accumulation of capital and the concentration of economic power”? That would give us a whole new slant on life. Money allows for a level of investment and accretion previously unknown.
Again, hypothetically speaking, money is just an instrument of exchange that “could” be used for good or bad, for medicine or murder. And to be sure, in everyday life we do use it often for good things like food and shelter. But looking at the larger picture, money best serves those who have immense amounts of it and who use it to accumulate power in order to accumulate still more money.
One could go on with other specific cultural artifacts and institutional arrangements: guns, vehicles, the military, education, and even what is called “culture.” Rather than mouthing the truism that these things can be used for good or bad, it is more useful to recognize that such instrumentalities do not exist as abstractions but gather definition only within the context of a social order. Thus the instrumentality not only has all the potential biases and distortions of that order but it contributes distortions and injustices of its own, bringing still more empowerment and efficacy to those who least need it.
It is not very helpful to say that technology or money can be used for good or bad. What we have to determine is why potentially beneficial things like technology and money most often are applied with such ill effect. But that would bring us to a radical analysis of the politico-economic system itself, a subject that is avoided like the plague even by most of those investigators who denounce the symptomatic abuses of that system.
20 FALSE CONSCIOUSNESS
Some observers hold that people often pursue goals that do not really serve their best interests. But others maintain that when making such an assertion we are presuming to know better than the people themselves what is best for them. To avoid superimposing one’s own ideological expectations on others, one should be a neutral observer, not an elitist social engineer; hence, whatever policy or social condition people define as being in their best interest at any given time should be accepted as such—so the argument goes.
This “neutral” position, however, rests on an unrealistic and deliberately one-dimensional view of the way people arrive at their beliefs. It denies the incontrovertible fact that awareness about issues and events is often subject to control and manipulation. In judging what is in their own interest, individuals are influenced by many factors, including the impact of dominant social forces greater than themselves. In C. Wright Mill’s words: “What people are interested in is not always what is to their interest; the troubles they are aware of are not always the ones that beset them. . . . It is not only that [people] can be unconscious of their situations; they are often falsely conscious of them.”
For example, if the U.S. public manifests no mobilized opposition to the existing social order or some major aspect of it, this is treated as evidence of a freely developed national consensus. What is ruled out a priori is the possibility of a manipulated consensus, a controlled communication universe in which certain opinions are given generous play and others—such as many of the contrary notions found in this book—are systematically ignored, suppressed, or misrepresented.
To deny the possibility of false consciousness is to assume there has been no indoctrination, no socialization to conventional values, and no suppression of information and dissenting opinion. In fact there exists a whole array of powers that help prefigure how we see and define our own interests and options.
If no overt conflict exists between rulers and ruled, this may be because of one or more of the following reasons:
Consensus satisfaction: Citizens are content with things because their real interests are being served by their rulers.
Apathy and lack of perception: People are indifferent to political matters. Preoccupied with other things, they do not see the link between issues of the polity and their own well-being.
Discouragement and fear: People are dissatisfied but acquiesce reluctantly because they do not see the possibility of change or they fear that change will only make things worse or they dread the repression that will be delivered upon them if they try to confront the powers that be.
False consciousness: People accept the status quo out of lack of awareness that viable alternatives exist and out of ignorance as to how their rulers are violating their professed interests or out of ignorance of how they themselves are being harmed by what they think are their interests.
Those who are enamored with the existing order of things would have us believe that of the above possibilities only the first three, relating to consensus, apathy, and fear, are conditions of consciousness that can be empirically studied, because they are supposedly the only ones that exist.
In fact, there exist two kinds of false consciousness. First, there are the instances in which people pursue policy preferences that are actually at odds with their interests—as they themselves define those interests. For instance, there are low-income citizens who want to maximize their disposable income but then favor a regressive sales tax over a progressive income tax because of a misunderstanding—repeatedly propagated in TV ads financed by the opponents of the progressive income tax—of the relative effects of each tax on their pocketbooks. The sales tax actually falls proportionately more heavily upon them than does the progressive income tax, and costs them far more in dollars. A limited level of information or a certain amount of misinformation leads people to pursue policy choices that go directly against their “self-defined” interests.
In the second instance of false consciousness, the way people define their interests in the first place may itself work against their well-being. Thus, they may think that supporting the actions of U.S. troops in Vietnam or Panama or Iraq or wherever may be furthering their interest in maintaining the United States as the world’s leading superpower and keeping them safe from terrorists. But the superpower nation-state, with its huge arms expenditures, heavy taxes, gigantic national debt, neglected domestic services, and environmental devastation—along with the death and destruction it delivers upon other peoples and the culture of violence and statist autocracy it propagates at home—may actually be creating more enemies rather than less, while lowering rather than enhancing the security and quality of people’s lives and the nation’s vitality.
To give a less complicated example, there are people who think the system of private health care, ever so costly it may be, is best for them. They have been told, and they believe, that a socialized health program or a national insurance program would produce medical care that is inferior, “bureaucratic,” and more costly. Here again such opinions are well fertilized by the powers that be, in this case the private health care industry. But the truth is that in nations with public health care, the costs are less, the coverage is comprehensive, and the care is far less nightmarish than what is encountered by so many in our present system.
In short, it is possible to demonstrate that (a) many people support positions or political forces that violate their own professed interests, and (b) many people profess interests that violate their actual well-being. Their stated preferences may themselves be a product of a socio-political system that works against their interests. To know what their interests are, they need access to accurate information about the policy world and how it affects them.
The rejection of false consciousness as being an ideological and elitist superimposition leads mainstream social scientists and other opinion makers to the conclusion that no distinction should be made between perceptions of interest on the one hand, and what might be called real or objective interest on the other. Any preference expressed by any individual must be accepted as his or her real interest. (Does this apply to teenagers as well?) This position makes no distinction between our perceived interests (which might be ill-informed and self-defeating) and our real interests (which might be difficult to perceive because of a lack of accurate, honest, and readily accessible information). To reject the concept of false consciousness as elitist is to ignore the fact that one’s awareness of one’s own interests and one’s political consciousness in general may be stunted or distorted by misinformation, disinformation, years of manipulated socialization, and a narrow but highly visible mainstream political agenda that rules out feasible alternatives. It is really not too much to say that people can be misled.
The reduction of interest to a subjective state of mind leads us not to a more rigorous empiricism but to a tautology: “people act as they are motivated to act” becomes “people always act in their own interest.” Whatever individuals are motivated to do or select or pursue or believe, or not do and not believe, is taken as being in their interest because, by definition, their interest is their motivational condition.
The point, then, is that without making judgments about people’s beliefs we can still inquire as to how they came to their preferences rather than treat these preferences as an irreducible and unchallengeable given. For instance, Americans are not congenitally endowed with loyalty to a particular social order that propagates competitiveness, consumerism, militarism, economic inequality, and environmental devastation. The definition they give to their interests—by selecting officeholders who are dedicated to such a social order—is shaped almost entirely by the social forces determining their universe of discourse, all sorts of forces acting well beyond their awareness, especially when the so-called impartial information being circulated is actually profoundly biased and manipulative in favor of moneyed interests.
One can see instances of false consciousness all about us. There are people with legitimate grievances as employees, taxpayers, and consumers who direct their wrath against welfare mothers but not against corporate plunderers of the public purse, against the inner-city poor but not the outer-city superrich, against human services that are needed by the community rather than regressive tax systems that favor the affluent. In their confusion they are ably assisted by conservative commentators and hate-talk hosts who provide ready-made explanations for their real problems, who attack victims instead of victimizers, denouncing “liberal elites,” feminists, gays, minorities, and the poor. Thus the legitimate grievances of millions are deliberately and with much strenuous effort directed against irrelevant foes.
Does false consciousness exist? It certainly does and in mass-marketed quantities. It is the mainstay of the conservative reactionism of the last three decades. Without it, those at the top, who profess a devotion to our interests while serving only their own, would be in serious trouble indeed.
21 LEFT, RIGHT, AND THE “EXTREME MODERATES”
The terms “right” and “left” are seldom specifically defined by policymakers or media commentators—and with good reason. To explicate the politico-economic content of leftist governments and movements is to reveal their egalitarian and humane goals, making it much harder to demonize them. The “left,” as I would define it, encompasses those individuals, organizations, and governments that advocate equitable redistributive policies benefiting the many and infringing upon the privileged interests of the wealthy few.
The right-wingers are also involved in redistributive politics, but the distribution goes the other way, in an upward direction. In almost every country, including our own, rightist groups, parties or governments pursue policies that primarily benefit those who receive the bulk of their income from investments and property, at the expense of those who live off wages, salaries, fees, and pensions. That is what defines and distinguishes the right from the left.
What is called the political right consists of conservatives, many of whom are dedicated to free-market capitalism, the unregulated laissez-faire variety that places private investment ahead of all other social considerations. Conservative ideology maintains that rich and poor get pretty much what they deserve; people are poor not because of inadequate wages and lack of economic opportunity but because they are lazy, profligate, or incapable. The conservative keystone to individual rights is the enjoyment of property (moneyed) rights, especially the right to make a profit off other people’s labor and enjoy the privileged conditions of a favored class.
Conservatives blame our troubles on what billionaire Steve Forbes called the “arrogance, insularity, [and] the government-knows-best mentality” in Washington, D.C. Everything works better in the private sector than in the public sector, they maintain. Most conservative ideologues today might better be classified as reactionaries, having an agenda not designed merely to protect their present privileges but to expand them, rolling back all the progressive gains made over the last century. They want to do away with most government regulation and taxation of business, along with environmental and consumer protections, minimum-wage laws, unemployment compensation, job-safety regulations, and injury-compensation laws. They assure us that private charity can take care of needy and hungry people, and that there is no need for government handouts. On that last point, it should be noted, the superrich donate a far smaller proportion of their income to private charities than people of more modest means.1
Conservatives seem to think that everything would be fine if government were reduced to a bare minimum. Government is not the solution, it is the problem, they say. In actual practice, however, they are for or against government handouts depending on whose hand is out. They want to cut human services to low- and middle-income groups, but they vigorously support gargantuan government subsidies and bailouts for large corporate enterprises. They admonish American workers to work harder for less and have not a concern about the increase in economic hardship for working people.
Conservatives and reactionaries also support strong government measures to restrict dissent and regulate our private lives and personal morals, as with anti-abortion laws and bans on gay marriage. Most of them are big supporters of mammoth military budgets and the U.S. global empire, which they seem to equate with “Americanism.” Yet many of them managed to avoid military service, preferring to let others do the fighting and dying. Such was the case with President George W. Bush, Vice President Dick Cheney, Congressman Tom Delay, commentator Rush Limbaugh, and scores of other prominent right-wing leaders and pundits.2
Not all conservatives and reactionaries are affluent. Many people of rather modest means, are conservative about “family values.” They want government to deny equal rights to homosexuals, impose the death penalty more vigorously, propagate the superpatriotic virtues, and take stronger measures against street crime, issues about which they feel liberals are dangerously deficient. As one newspaper columnist writes, they think that government has a prime responsibility to protect “their right to kill themselves with guns, booze, and tobacco” but a “minimal responsibility to protect their right to a job, a home, an education or a meal.”3 Conservative politicians talk about “upholding values,” but they make no effort to uphold values by rooting out corruption in the business world or protecting the environment or lending material support to working families.
The same conservatives who say they want government to “stop trying to run our lives” also demand that government regulate our personal morals, keep us under surveillance, and deny us the right to habeas corpus, open dissent, antiwar demonstrations, and safe and legal abortions. They want government to put God back into public life, require prayers in our schools, subsidize religious education, and shove their particular notion of Jesus down our throats at every opportunity. They blame the country’s ills on secular immorality, homosexuality, feminism, “liberal elites,” and the loss of family values. TV evangelist and erstwhile Republican presidential hopeful Pat Robertson charged feminism with hatching diabolical and even murderous plots against family, marriage, and capitalism.4 The religious right supports conservative causes. In turn, superrich conservatives help finance the religious right.
Toward the center of the political spectrum we find the moderates, also known as the centrists, exemplified by former president Bill Clinton. Like the conservatives, the centrists accept the capitalist system and its basic values but they think social problems should be rectified by piecemeal reforms and regulatory policies. Along with conservatives, many centrists support “free trade” and globalization, claiming that it will benefit not just corporations but everyone. They pushed for the elimination of family assistance (“welfare”), and regularly vote in Congress for big subsidies to private business and big military spending bills. They often back military interventions abroad if convinced that the White House is advancing the cause of peace and democracy—as with the massive 78-day U.S. bombing of women, children, and men in Yugoslavia in 1999, and the interventions in Afghanistan and Iraq (withdrawing their support in the latter instance when Iraq proved more costly than anticipated).
A shade to the left of the centrists are the liberals who see a need for improving public services and environmental protections. They support minimum-wage laws, unemployment insurance, and other wage supports, along with Social Security, nutritional aid for needy children, occupational safety, and the like. They say they are for protection of individual rights and against government surveillance of law-abiding political groups, yet in Congress (where most of them are affiliated with the Democratic Party), they sometimes have supported repressive measures and have gone along with cuts in programs for the needy. Some of them also have voted for subsidies and tax breaks for business. At other times they have opposed the reactionary rollback of human services, the undermining of labor unions, and shredding of environmental protections.
Further along is the political left: the progressives, social democrats, democratic socialists, and issue-oriented Marxists. (There is also a more ideologically oriented component of the left composed mostly of Trotskyists, anarchists, anarcho-syndicalists, “libertarian socialists” and others who will not figure in this discussion given their small numbers and intense sectarian immersion. What they all have in common is an obsessional anticommunism, a dedication to fighting imaginary hordes of “Stalinists” whom they see everywhere, and with denouncing existing communist nations and parties. In this they resemble many centrists, social democrats, and liberals.)
The issue-oriented progressive left wants to replace or substantially modify the corporate free-market system, putting some large corporations and utilities under public ownership, and smaller businesses under cooperative worker ownership when possible. Some left progressives would settle for a social democracy—as might be found in Sweden, Denmark, Finland, and a few other countries—with strong labor unions and firm controls on corporate business to safeguard the public interest and the environment. A democratically responsive government, progressives insist, has an important role to play in protecting the environment, advancing education, providing jobs for everyone able to work, along with occupational safety, secure retirement, and affordable medical care, education, and housing. In sum, a left-progressive government would spend far less on the military and on business subsidies and far more improving the social wage and the quality of life.
There remains a problem with this alignment of left, right, and center. It has to do with the tendency to ascribe “moderation” to those on the center, and “extremism” indiscriminately to those on the “far left” and “far right,” based on an inclination to conflate spatial relations with moral meanings. Labels such as “left,” “center,” and “right” refer to the political spectrum. They are metaphoric spatial terms used to signify one’s position on social, political, and economic issues. By virtue of its linear nature, the political spectrum can be extended at both ends to allow for limitless left-wing and right-wing extremes. The extreme, by definition, is the “utmost part, utmost limit.”
It follows that an “extreme center” is a contradiction in terms, the extremes of the center being nothing more than the beginnings of the moderate left and moderate right.
But “extreme” has another meaning, a behavioral one that evokes an image of intransigence and violence. In news reports and common parlance, this second meaning is blended with the first and then ascribed to the left and right, but by definition never to the center.
By the same token, “moderate” has a purely quantitative meaning, as in a “moderate amount” or “moderate placement.” However “moderate” also connotes “fair-mindedness” and “not given to excess.” Again, the two meanings are conflated, and the political center is said to be occupied by moderates who, by definition, cannot be excessive or immoderate.
Other laudable concepts are associated with centrist moderation. Political moderates in various countries are described as defenders of stability. But whose stability? For whose benefit? At whose expense? Centrist moderates are “pragmatic,” “undogmatic,” and “free of ideology,” a judgment made by ignoring, say, Chile, where the Christian Democratic centrists supported the fascist overthrow of a democratic government because, like most centrists, they were far more afraid of those to the left of them, even a democratically elected coalition of leftists, than they were of the militarists to the right who tore up the Chilean constitution and murdered thousands.
As our unexamined political vocabulary would have it, the moderate centrists can do no evil, while the immoderate extremists can do no good. In truth, those who occupy the mainstream center are capable of immoderate, brutal actions. It wasn’t fascist extremists who pursued a massively destructive war in Indochina. It was the “best and the brightest” of the political center, the extremists of the center, the moderate extremists, if you will. These same moderates supported the overthrow of popular governments in Guatemala, Indonesia, Iran, and Chile, and helped install fascist military regimes in their stead.
It wasn’t the leftists or rightists who waged a war against Yugoslavia, with its repeated bombings of civilian populations and its military assistance to ex-Nazi Croatian and Muslim Bosnian separatists.5 It was that paragon of centrism Bill Clinton and all the centrists and moderate liberals who stood shoulder to shoulder with him and with NATO and the CIA (along with a gaggle of those anarchists and Trotskists I mentioned earlier who convinced themselves that the destruction of the Yugoslavian social democracy was a blow against Stalinist communism).
The crucial point is that those who occupy the extremes of the political spectrum (in accordance with beliefs about changing the politico-economic order) are not necessarily extremists in the pejorative or moral sense. We might ask what is so extremist about landless peasants and destitute laborers in countries such as El Salvador taking up arms against death squads and starvation? What is so moderate about governments that maintain such repressive conditions? A glance at the many miseries of the Third World should tell us that extremism, in the worst sense of the word, is embedded in the prevailing “moderate” stability.
Our understanding of politics should allow us to distinguish between racists and anti-racists, between those on the “far left” who work with low-income ethnic minorities and those on the “far right” who want to exterminate low-income ethnic minorities. But the presumptive label of “extremism” imposed by centrists is designed to blur just such essential distinctions. Indeed, the French go so far as to fashion a slogan, les extrêmes se touche; the extremes extend so far that they “touch,” that is, they resemble each other and end up doing the same things. That is a rare thing if ever it does happen. At opposite ends of the political spectrum, the extremes stand for quite markedly different socio-political worlds.
The question of who is and who isn’t extremist in the moral sense, then, is not to be settled by resorting to a linear political spectrum. Different varieties of extreme moderates or centrists have long been in power. In collaboration with the rightists, they have given us Vietnam, Watergate, global counterinsurgency, gargantuan military budgets, dirty wars in Iraq and Afghanistan, a regressive tax burden, huge corporate subsidies, and the promise of a rigorous repression of dissent—all in the name of security, stability, patriotism, religion, family, and other such things. Look then at what they do, not at how they are labeled.
22 STATE VS. GOVERNMENT
We might best think of the American polity (like any other polity) as a dual system of government and state. The government deals with visible officeholders, pressure-group politics, and popular demands. It provides the representative cloak and whatever substance of democratic rule that has been won through generations of mass struggle. In contrast, the state has little if anything to do with popular rule or public policy as such. It is the ultimate coercive instrument of class power. Max Weber wrote that the state’s essential trait, its irreducible feature, is its monopoly over the legitimate uses of force—“legitimate” in that they are legally sanctioned by the duly constituted authorities.
To fulfill its role as protector of existing order, the state often circumvents the democratic restraints that exist within government. The late FBI chief J. Edgar Hoover noted in a 1970 interview that “justice is merely incidental to law and order.” And, as Hoover made clear by his actions, the real goal of law and order is to protect the dominant social order.
Roughly speaking, the difference between government and state is the difference between the city council and the police, between Congress and the armed forces. The government mediates public policy. The state orchestrates coercion and control, both overtly and covertly. However, this is a conceptual distinction between what are really empirically overlapping phenomena. The overlap is especially evident in regard to the executive, which is both the center of government policy and the purveyor of state power.
The conceptual distinction between state and government allows us to understand why taking office in government seldom guarantees full access to the instruments of state power. When Salvador Allende, a Popular Unity candidate dedicated to democratic egalitarian reforms, was elected president of Chile in 1971, he took over the reins of government and was able to initiate some popular policies. But he could never gain control of the state apparatus, that is, the military, the police, the intelligence services, the courts, and the fundamental organic law that rigged the whole system in favor of wealth and corporate property. When Allende began to develop a reform program for the benefit of the common populace and against class privilege, the Chilean military, abetted by the White House and the CIA, seized power and murdered thousands of his supporters, destroying not only Allende’s government but the democracy that produced it.6
In Nicaragua, after the Sandinistas lost the 1990 election to a right-centrist coalition, the army and police remained in their hands. However, in contrast to the Chilean military, which was backed by the immense power of the United States, the Nicaraguan military was the target of that same power and was unable to keep the government on its revolutionary course. Sandinista police and military were seriously defunded by a U.S.-backed government.
Capitalist countries with ostensibly democratic governments often manifest a markedly undemocratic state power. In the United States, not just conservatives but Cold War liberals have used the FBI to suppress anticapitalists and other dissidents in the interest of state security and often in violation of the U.S. Constitution. In 1947, President Harry Truman created the Central Intelligence Agency to gather and coordinate foreign intelligence. As ex-Senator George McGovern noted “Almost from the beginning, the CIA engaged not only in the collection of intelligence information, but also in covert operations which involved rigging elections and manipulating labor unions abroad, carrying on paramilitary operations, overturning governments, assassinating foreign officials, protecting former Nazis and lying to Congress.”7
With its secrecy, laundering of funds, drug trafficking, and often unlawful use of violence, the national security state stands close to organized crime. State agencies sometimes find it convenient to collude with underworld elements. Anthony Summers found that the FBI retained close links with organized crime. Former CIA-operative Robert Morrow, along with others, discovered that the CIA too was cozy with the mob. And over the years, several congressional investigative committees uncovered links between the CIA and the narcotics trade.8
In other Western democracies, secret paramilitary forces of neofascist persuasion (the most widely publicized being Operation Gladio in Italy) were created by NATO, to act as resistance forces should anticapitalist revolutionaries take over their countries. Meantime, these secret units were involved in terrorist attacks against the legal left. They helped prop up a fascist regime in Portugal, participated in the Turkish military coups of 1971 and 1980, and the 1967 coup in Greece. They drew up plans to assassinate social democratic leaders in Germany and stage “preemptive” attacks against socialist and communist organizations in Greece and Italy. They formed secret communication networks and drew up detention lists of political opponents to be rounded up in various countries.
These crypto-fascist operations “flowed from NATO’s unwillingness to distinguish between a Soviet invasion and a victory at the polls by local communist parties.”9 As far as NATO was concerned there was not much distinction between losing Europe to Soviet tanks or to peaceful ballots. Indeed, the latter prospect seemed more likely. The Soviet tanks could not roll without risking a nuclear conflagration, but through the ballot box the anticapitalists might take over whole countries without firing a shot. One is reminded of Secretary of State Henry Kissinger’s comment, supporting the overthrow of Chilean democracy: “I don’t see why we need to stand by and watch a country go communist [that is, voting for Allende’s coalition government] because of the irresponsibility of its own people.”
In the United States, various right-wing groups with well-armed paramilitary camps and secret armies flourish unmolested by the Justice Department, which does not find them in violation of any law. Were they anticapitalist armed groups, they would likely be attacked by federal and local police and their members killed, as happened to the Black Panther Party in various parts of the country in the late 1960s and early 1970s.
Today, conservative theorists represent themselves as favoring laissez-faire policies; the less government the better. In practice, however, the “free market” system is rooted in state power. Every private corporation in America is publicly chartered, made a legal entity by the state, with ownership rights and privileges protected by the laws, courts, police, and army.
While conservative elites want less government control, they usually want more state power to contain the egalitarian effects of democracy. They want strong, intrusive, statist action to maintain the prerogatives and privileges of corporate America. They prefer a state that restricts access to information about its own activities, takes repressive measures against dissidents, and in other ways acts punitively not toward the abusers of state power but toward their challengers.
Conservative propaganda that is intended for mass consumption implicitly distinguishes between government and state. It invites people to see government as their biggest problem, while at the same time, encouraging an idolatrous admiration for the state, its flag and other patriotic symbols and rituals, and the visible instruments of its power, such as the armed forces.
The executive, be it monarch, prime minister, or president, usually stands closer to state functions than does the legislature. Some European systems have a prime minister, who deals with legislative and budgetary agendas and other governmental affairs, and a president, who is commander in chief of the armed forces and head of state—a duality that gives unspoken embodiment to the distinction between government and state. In the U.S. system, the executive combines the functions of prime minister and president, of government and state, of party leader and constitutional monarch.
In Italy, from 1969 to 1980, high-ranking elements in military and civilian intelligence agencies, along with secret and highly placed neofascist groups, embarked upon a campaign of terror and sabotage known as the “strategy of tension,” involving a series of kidnappings, assassinations, and bombing massacres (i stragi), including the explosion that killed 85 people and injured some 200 in the Bologna train station in August 1980. This terrorism was directed against the growing popularity of the democratic parliamentary left, and was designed to “combat by any means necessary the electoral gains of the Italian Communist Party.” Deeply implicated in this campaign, the CIA refused to cooperate with an Italian parliamentary commission investigating i stragi in 1995. Of special interest is that the rightist terrorists understood the importance of a strong executive in maintaining state control. Their professed objective, according to the commission, was to create enough terror to destabilize the multiparty social democracy and replace it with an authoritarian “presidential republic,” or, in any case, “a stronger and more stable executive.”10
Marx himself grasped the special role played by the executive in the maintenance of state power and class supremacy. He noted that the president of the Second Republic in France represented the entire nation rather than a particular district. The National Assembly exhibits in its individual representatives “the manifold aspects of society,” but it is the president who is “the elect of the nation,” an embodiment of the nation-state.11
Marx is often misquoted as having said that the state is the executive committee of the bourgeoisie. Actually, in The Communist Manifesto, he and Engels wrote that “the executive of the modern State is but a committee for managing the common affairs of the whole bourgeoisie.” Thus they recognized the systemic class function of the executive. They also implicitly acknowledged that bourgeois government in toto is not a solid unit. Parts of it can become an arena of struggle. This is true even within the executive branch itself. Thus, the U.S. Department of Health and Human Services and the Department of Housing and Urban Development usually deal with constituencies and interests that differ from those components of the executive represented by the Department of Defense, or the Departments of Treasury and Commerce.
Nesting within the executive is that most virulent purveyor of state power: the national security state, an informal configuration that usually includes the Executive Office of the White House, special White House planning committees, the sixteen intelligence agencies, the Pentagon, Joint Chiefs of Staff, director of national intelligence, National Security Council, and other such units engaged in surveillance, suppression, covert action, and forceful interventions abroad and at home. The president operates effectively as head of the national security state as long as he stays within the parameters of its primary dedication—which is to advance the interests of corporate investors and protect the overall global capital accumulation process.
In 1977, President Carter tried to appoint Theodore Sorenson as director of the CIA. Sorenson, a high-profile liberal, had been a conscientious objector and had filed affidavits defending Daniel Ellsberg and Anthony Russo for their role in releasing the Pentagon Papers. Conservative Republicans on the Senate Select Committee on Intelligence, along with Democrats like chairperson Daniel Inouye, opposed Sorenson. They said his association with a law firm that dealt with countries in which the CIA had a great deal of influence might cause a “conflict of interest.” They questioned his use of classified documents when writing a book and raised a number of other rather unconvincing complaints. It was later reported that the real concern of some senators was that “the CIA director should be a more hardline conservative figure than Mr. Sorenson.”12 Officials in the CIA itself quietly made known their opposition and Sorenson’s candidacy was withdrawn.
After John Kennedy assumed presidential office in 1961, CIA director Allen Dulles regularly withheld information from the White House regarding various covert operations. When Kennedy replaced Dulles with John McCone, the agency began withholding information from McCone. Placed at the head of the CIA in order to help control it, McCone was never able to penetrate to the deeper operations of the agency.
This does not mean that the CIA is a power unto itself. It is an instrument that serves the enduring interests of the plutocracy. (“Plutocracy” refers to rule by the wealthy or to rulers who favor wealthy interests.) In 2004 this became clear when the White House under Bush Jr. stripped the top leadership of the CIA, blamed it for the administration’s own misjudgments about Iraq and appointed a National Director of Intelligence to preside over all the various intelligence agencies. Having been thoroughly drubbed by the White House, a number of top members of the CIA meekly left office in quick succession. Ultimate power does not rest with the CIA but with the class for which it works.
When the presidency is controlled by a liberal who might depart from the prime path of global corporate supremacy, the CIA can be expected to oppose and even sabotage the administration. When the presidency is controlled by the ascendant ultra-conservative elements of the plutocratic class as in the Bush Jr. administration, then the CIA’s role is still the same, to serve the interests of global corporate supremacy, even if it must fall on its sword to do so.
A president working closely with the national security state and unequivocally for corporate hegemony usually can operate outside the laws of democratic governance with impunity. Thus President Reagan violated international law by engaging in an unprovoked war of aggression against Grenada. He violated the U.S. Constitution when he refused to spend monies allocated by Congress for various human services. He and other members of his administration refused to hand over information when specific actions of theirs were investigated by Congress. By presidential order, he overruled statutory restrictions on the CIA’s surveillance of domestic organizations and activities—even though a presidential order does not supersede an act of Congress. His intervention against Nicaragua was ruled by the World Court, in a 13-to-1 decision, to be a violation of international law, but Congress did nothing to call him to account. He was up to his ears in the Iran-Contra conspiracy but was never called before any investigative committee while in office. One could build a similar record with just about every other president in recent decades. In its unpunished, illegal acts, the executive demonstrates the autocratic nature of the state.
With enough agitation and publicity, government sometimes is able to put the state under public scrutiny and rein it in—a bit. During the late seventies, House and Senate committees investigated some of the CIA’s unsavory operations, and laid down restrictive guidelines for the FBI. But the Iran-Contra hearings of 1987 reveal the damage-control function of most official inquiries. As representatives of popular sovereignty, the Joint Select Committee of Congress investigating the Iran-Contra conspiracy had to reassure the public that these unlawful, unconstitutional doings would be exposed and punished. However, the process of legitimation through rectification is a two-edged sword. It must go far enough to demonstrate that the system is self-cleansing, but not so far as to destabilize the executive power. So the same congressional investigators who professed a determination to get to the bottom of Iran-Contra were also repeatedly reminding us that “this country needs a successful presidency,” meaning that after the scandals of Watergate and President Nixon’s downfall, they had better not uncover too much and risk further damage to executive legitimacy.
In sum, the Iran-Contra investigation was both an exposé and a cover-up, unearthing wrongdoing at the subordinate level—to show that the system is self-correcting—while leaving President Reagan and the immense powers of his office largely untouched.
Congressional intelligence committees are usually occupied by members of both parties who identify closely with the needs of the national security state. The Bush Sr. administration was reportedly stunned by the appointment of five liberals to the House Intelligence Committee (of twenty or so members) by a Democratically controlled House. By registering its disapproval, the administration was saying in effect that the committee has a distinctive relationship to the state and that there should be a special ideological test for its members.
Lawmakers who fail the state’s ideological test but who occupy key legislative positions run certain risks. When Jim Wright (DTX), became Speaker of the House of Representatives, he began raising critical questions about CIA covert actions against Nicaragua. Because the Speaker of the House was not someone who could easily be ignored, his charges received press coverage. Indeed, he was taken seriously enough to be attacked editorially by the Washington Post and the New York Times for his comments on Nicaragua. At the time, I began to wonder aloud if Wright might have a mysterious fatal accident or just die suddenly of natural causes. But nowadays there sometimes is a neater way of getting rid of troublesome officeholders. The Republican-controlled Justice Department did a thorough background check on Wright and found questionable financial dealings—not too difficult to do in regard to most politicians who are ever in need of campaign funds. He allegedly had accepted improper financial gifts from a Texas developer and a publisher. Wright quickly resigned.
Next in line to be Speaker was Tom Foley of Washington State, who could be counted on never to raise troublesome questions about the doings of the national security state. Critics of the national security state are a minority within Congress. Generally, congressional leaders are complicit with the state and with their own disempowerment. Members serving on intelligence committees rarely fulfill their oversight function. They do not ask too many questions about secret operations and dirty tricks.
During the Iran-Contra hearings, Rep. Jack Brooks (D-TX), taking his investigative functions seriously, asked Lieutenant Colonel Oliver North if there was any truth to the story that he had helped draft a secret plan, code-named, to suspend the Constitution and impose martial law in the United States “in the event of emergency.” A stunned expression appeared on North’s face and the committee chair, the predictable Senator Daniel Inouye, stopped Brooks in his tracks, declaring in stern tones “I believe the question touches upon a highly sensitive and classified area. So may I request that you not touch upon that, sir.” Brooks attempted to continue but Inouye again cut him off. It was a tense moment. The chair was making it clear that the state was not to be too closely policed.
The national security state has largely succeeded in removing much of its activities from democratic oversight. Intelligence agencies have secret budgets that are explicitly in violation of Article I, Section 9, which reads in part: “No Money shall be drawn from the Treasury but in Consequence of Appropriations made by Law. And a regular Statement and Account of the Receipts and Expenditures of all public Money shall be published from time to time.” There are no published statements of expenditures for the intelligence community, guessed to be between $35 billion and $50 billion a year. Its appropriations are hidden in other parts of the budget and are unknown even to most members of Congress who vote on the funds.
Sometimes the state’s determination to set itself above and outside the Constitution is not done secretly but expressed overtly, as on the eve of war during the 1990–1991 Gulf crisis when Secretary of State James Baker publicly stated, “We feel no obligation to go to Congress for a declaration of war,” and President Bush Sr. announced he would commit troops to combat even if he got not a single supporting vote in Congress. Rather than being censored for such a lawless declaration and for acting as if the army were his personal force, Bush was hailed in the media for his “strong leadership.”
One is reminded of Teddy Roosevelt’s boast almost a century ago regarding his imperialist intervention in Panama: “I took the Canal Zone and let Congress debate.” The danger of the executive is that it executes. Unlike the legislature or the courts it has its hands on the daily levers of command and enforceable action.
Having said that the national security state is removed from the democratic process, I do not wish to imply that it is removed from our lives. In fact, it reaches deeply into various areas of society. Consider organized labor. In collaboration with the national security state, the AFL-CIO leadership has sponsored organizations like the American Institute for Free Labor Development (AIFLD) in Latin America, along with similar ones in Africa and Asia, dedicated to building collaborationist, anticommunist unions that undermine the more militant leftist ones.
The national security state exercises an influence over the corporate media. The CIA owns numerous news organizations, publishing houses, and wire services abroad, which produce disinformation that makes its way back to the states. In the United States, the CIA has actively trained “Red squads” of local police in methods of surveillance and infiltration. The narcotics traffic has been supported in part by elements in the CIA and various local police forces with the inevitable effect, and probably actual intent, of disorganizing and demoralizing the inner-city masses and discouraging militant community movements from emerging.13
Executive usurpation is visible also in Eastern Europe, where the people of former communist nations now are able to savor the draconian joys of the capitalist paradise. The political democracy that had been used to overthrow communism soon became something of a hindrance for capitalist restoration. So democracy itself needed to be diluted or circumvented in order that the “democratic reforms”—that is, the transition to free-market capitalism—be fully effected. Not surprisingly the presidents of various Eastern European states such as Hungary, Poland, the Czech Republic, and Russia, have repeatedly chosen state over government, calling for the right to rule by executive ukase. In Russia, President Boris Yeltsin used force and violence to tear up the constitution, suppress the democratically elected parliament and provincial councils, monopolize the media, kill over a thousand people and arrest thousands more—all in the name of saving democracy.14 The new government instituted by Yeltsin granted sweeping powers to the executive.
The U.S. Constitution contains provisions that apply directly to state functions, for instance, the power to organize and arm the militia and call it forth to “suppress Insurrections.” Article I, Section 9 of the Constitution says that the writ of habeas corpus, intended to defend individuals from arbitrary arrest, can be suspended during national emergencies and insurrections. A presidential edict is sufficient for that purpose. In effect, the Constitution provides for its own suspension on behalf of executive-state absolutism. In recent years Congress has proven most accommodating in that endeavor, passing all sorts of repressive laws, from the Patriot Act to the Military Commissions Act, giving the executive state a host of undemocratic and unconstitutional powers.
When capitalism is in crisis, the capitalist state escalates its repression, from attacking the people’s standard of living to attacking the democratic rights that might allow them to defend that standard of living. Democracy uneasily rides the tiger of capitalism. People with immense wealth and overweening power will resort to every conceivable means to secure their interests—the state being the most important weapon in their furious undertaking.
23 DEMOCRACY VS. CAPITALISM
It will disappoint some people to hear this, but in fact there is no one grand, secret, power elite governing this country. But there are numerous coteries of corporate and governmental elites who communicate and coordinate across various policy realms. And behind their special interests are the common overall interests of the moneyed class. Many of the stronger corporate groups tend to predominate in their particular spheres of interest, more or less unmolested by other elites, which is not to say that disputes never arise between plutocratic interests.
Business exerts an overall influence as a system of social power, a way of organizing capital, employment, and large-scale production. Because big business controls much of the nation’s economy, government perforce enters into a uniquely intimate relationship with it. The health of the economy is treated by policymakers as a necessary condition for the health of the nation, and since it happens that the economy is mostly in the hands of large corporate interests, then presumably government’s service to the public is best accomplished by service to those interests. The goals of business (high profits, cheap labor, expanding markets, and easy access to natural resources) become the goals of government. The “national interest” becomes identified with the systemic needs of corporate capitalism at home and abroad. In order to keep the peace, business may occasionally accept reforms and regulations it does not like, but ultimately government cannot ignore business’s own raison d’être, which is the limitless accumulation of wealth.
Wealth, in turn, is the most crucial power resource in public life. It creates a pervasive political advantage, and affords ready access to other resources such as organization, skilled personnel, mass visibility, media ownership, outreach capacity, and the like. So wealth is used to attain power, and power is applied to secure and increase wealth.
Government involvement in the U.S. economy represents not socialism (as that term is normally understood by socialists) but state-supported capitalism, not the communization of private wealth but the privatization of the commonwealth. This development has brought a great deal of government involvement, but of a kind that revolves largely around bolstering the profit system, not limiting or replacing it.
In capitalist countries, government generally (a) nationalizes sick and unprofitable industries (“lemon socialism”) and (b) privatizes profitable public ones—in both cases for the benefit of big corporate investors.
Examples of (a): In 1986, in what amounted to a bailout of private investors, the social democratic government in Spain nationalized vast private holdings to avert their collapse. After bringing them back to health with generous nourishment from the public treasury, they were sold back to private companies at bargain prices. The same was done with Conrail in the United States: run into insolvency by private profiteers, brought back to health by generous infusions of public funds, only to be sold off again to private investors.
Some examples of (b), the privatization of prosperous state enterprises: A conservative Greek government privatized publicly-owned companies such as the telecommunications system, which had been reporting continuous profits for several years. In similar fashion, any number of industries in the United States were developed and capitalized by the government at great public expense, then handed over to private companies to be marketed for private profit.
When a government takes over a private enterprise, it usually gives full compensation to the owners. The investors who once owned the private stocks now own public bonds and collect the interest on these bonds. The wealth of the enterprise shifts from stocks to bonds. While ownership is now nominally public, the income still flows into private pockets. What the public owns in this case is a huge bonded debt—with all the risks and losses and none of the profits.
Defenders of the existing system assert that the history of “democratic capitalism” has been one of gradual reform. To be sure, important reforms have been won by working people. To the extent that the present economic order has anything humane and civil about it, it is because millions of people struggled to advance their living standard and their rights as citizens. It is somewhat ironic to credit capitalism with the genius of gradual reform when most reforms through history have been vehemently and sometimes violently resisted by the capitalist class and were won only after prolonged and bitter contest. It is doubly ironic to credit capitalism with being reformist when most of the problems needing reform have been caused or intensified by the capitalist plutocracy.15
Furthermore, the corporation does not exist for social reconstruction but for private gain. Corporations cannot build low-rent houses, feed the poor, clean up the environment, or offer higher education to any qualified modest-income person—unless government gives them lucrative contracts to do so. Even then their major concern would be to squeeze as much profit out of the program as possible.
How can we speak of the U.S. politico-economic system as being a product of the democratic will? What democratic mandate directed the government to give away more money every year to the top 1 percent of the population in interest payments on public bonds than are spent on services to the bottom 20 percent? When was the public last consulted on interest rates and agribusiness subsidies? When did the public insist on having unsafe overpriced medications, and genetically altered foods, and hormone-ridden meat and milk, and federal agencies that protect rather than punish the companies marketing such things? When did the American people urge that utility companies be allowed to overcharge consumers billions of dollars? When did the voice of the people clamor for unsafe work conditions in mines, factories, and on farms, and for recycling radioactive metals into consumer products and industrial sludge into agricultural topsoil? How often have the people demonstrated for multibillion-dollar tax breaks for the superrich, and privatization of Social Security, and cutbacks in student aid? When did they demand a multibillion-dollar space shuttle program that damages the ozone layer and leaves us more burdened by taxes and deprived of necessary services, along with an unworkable multibillion-dollar outer-space missile program that would only increase the dangers of nuclear confrontation if it ever did work? When did the populace insist that the laws of the land be overruled by international, nonelective, anonymous, “free-trade” panels in service to transnational corporations?
What democratic will decreed that we destroy the Cambodian and Laotian countrysides between 1969 and 1971 in bombing campaigns conducted without the consent or even the knowledge of Congress and the public? When did public opinion demand that we wage a mercenary war of attrition against Nicaragua, or attack Grenada, Panama, Somalia, Yugoslavia, Afghanistan, Iraq, and Haiti, slaughtering tens of thousands in the doing; or support wars against popular forces in El Salvador, Guatemala, Angola, Mozambique, the Western Sahara, and East Timor? Far from giving our consent, we ordinary people have had to struggle to find out what is going on.
The ruling class has several ways of expropriating the earnings of the people. First and foremost, as workers, people receive only a portion of the value their labor power creates. The rest goes to the owners of capital.
Second, as consumers, people are victimized by monopoly practices that force them to spend more for less. They are confronted with exploitative forms of involuntary consumption, as when relatively inexpensive mass-transit systems are eliminated to create a greater dependency on automobiles, or low-rent apartments are converted to high-priced condominiums, or a utility company doubles its prices after deregulation.
Third, as taxpayers, working people have had to shoulder an ever larger portion of the tax burden, while corporate America and the superrich pay less and less. Indeed, the dramatic decline in taxes on business and the superrich has been a major cause of growth in the federal debt. The debt itself is a source of investment and income for the moneyed class (via government bonds) and an additional tax burden on the populace.
Fourth, as citizens the people endure a lower quality of life. Hidden diseconomies are repeatedly foisted onto them by private business, as when a chemical company contaminates a community’s air or groundwater with its toxic wastes, or when the very survival of the planet is threatened by global warming.
The reigning system of power and wealth, with its attendant abuses and injustices, activates a resistance from workers, consumers, community groups, and taxpayers—who are usually one and the same people. There exists, then, not only class oppression but class struggle. Popular struggle in the United States ebbs and flows but never ceases. Moved by a combination of anger and hope, ordinary people have organized, agitated, demonstrated, and engaged in electoral challenges, civil disobedience, strikes, sitins, takeovers, boycotts, and sometimes violent clashes with the authorities—for socio-economic betterment at home and peace abroad. Against the heaviest odds, dissenters have suffered many defeats but won some important victories, forcibly extracting concessions and imposing reforms upon resistant rulers.
Democracy is something more than a set of political procedures. To be worthy of its name, democracy should produce outcomes that advance the well-being of the people. The struggle for political democracy—the right to vote, assemble, petition, and dissent—has been largely propelled by a desire to be in a better position to fight for one’s socioeconomic interests. In a word, the struggle for political democracy has been an inherent part of the struggle against plutocracy, a struggle for social and economic democracy.
Through the nineteenth and twentieth centuries, the moneyed classes resisted the expansion of democratic rights, be it universal suffrage, abolitionism, civil liberties, or affirmative action. They knew that the growth of popular rights would only strengthen popular forces and impose limits on elite privileges. They instinctively understood, even if they seldom publicly articulated it, that it is not socialism that subverts democracy, but democracy that subverts capitalism.
The reactionary agenda successfully advanced in recent years has been designed to take us back to 1900 or thereabouts. Wages are held down by forcing people to compete more intensely for work on terms favorable to management. This is done with speedups, downgrading, layoffs, the threat of plant closings, and union busting. In addition, owners eliminate jobs through mechanization and moving to cheaper labor markets overseas. They have sought to roll back child-labor laws, lower the employable age for some jobs, bring in unregulated numbers of immigrants, and raise the retirement age, further increasing the number of workers competing for jobs.
Another way to depress wages is to eliminate alternative sources of working-class support. The historical process of creating people willing to work for subsistence wages entailed driving them off the land and into the factories, denying them access to farms and to the game, fuel, and fruits of the commons. Divorced from this sustenance, the peasant reluctantly metamorphosed into the proletarian.
Today, unemployment benefits and other forms of public assistance are reduced in order to deny alternative sources of income. When public jobs are eliminated there are more people competing for employment in the private sector. When jobs are scarce, people are compelled to work harder for less. Conservatives seek to lower the minimum wage for youth and resist attempts to equalize wages and job opportunities for women and minorities, thus keeping women, youth, and minorities as the traditionally underpaid “reserve army of labor,” used throughout history to lower the floor on wages and keep the workforce divided and poorly organized. Racism is especially useful when channeling the economic fears and anger of Whites away from employers and toward out-groups who are seen as competitors for scarce jobs, education, and housing.
A century ago the working populace lived in hovels and toiled twelve to fourteen hours a day for poverty wages under gruesome conditions. Their children more often went to work than to school. But with decades of struggle, working people were able to better their lot. By the 1970s millions of them were working eight-hour days, had job seniority, paid vacations, time-and-half overtime, company medical insurance, and adequate retirement pensions; many lived in decent housing and even could pay a mortgage on a home of their own, while their kids went to public school and some even to public universities. Along with this came improvements in occupational safety, consumer safety, and health care.
More for the general populace, however, meant less for the privileged few. By the 1970s it looked like this country might end up as a quasi-egalitarian social democracy unless something was done about it. As Paul Volcker said when he was chair of the Federal Reserve in 1980, “The standard of living of the average American has to decline.”16
Decline it has. Over the last two decades the reactionary rollback has brought an increase in poverty and homelessness, substandard housing and substandard schools, longer work days with no overtime pay, less job security, wage and benefit cutbacks, a growing tax burden increasingly shifted onto the backs of the lower and middle classes, fewer if any paid vacation days, less affordable health care, privatization of public services, disappearance of already insufficient pensions, drastic cuts in disability assistance and family support, and serious dilution of occupational safety regulations and consumer and environmental protections.
Democracy becomes a problem for the plutocracy not when it fails to work but when it works too well helping the populace to move toward a more equitable and favorable social order, narrowing the gap however modestly between the superrich and the rest of us. So democracy must be diluted and subverted, smothered with disinformation and media puffery, with rigged electoral contests and with large sectors of the public disfranchised, bringing faux victories to the more reactionary candidates. At the same time, the right of labor to organize and strike has come under persistent attack by courts and legislatures. Federal security agencies and local police repress community activists and attack their right to protest.
The state is the single most important instrument that corporate America has at its command. The power to use police and military force, the power of eminent domain, the power to tax and legislate, to use public funds for private profit, float limitless credit, mobilize highly emotive symbols of loyalty and legitimacy, and suppress political dissidence—such resources of state give corporate America a durability it could never provide for itself. The state also functions to stabilize relations among the giant enterprises themselves. Historically, “firms in an oligopolistic industry often turn to the federal government to do for them what they cannot do for themselves—namely, enforce obedience to the rules of their own cartel.”17
The state is also the place where different ruling factions struggle over how best to keep the system afloat. The more liberal and centrist elements argue that those at the top of the social pyramid should give a little in order to keep a lot. If conservative goals are too successful, if wages and buying power are cut back too far and production increased too much, then the contradictions of the free market intensify. Profits may be maintained and even increased for a time through various financial contrivances, but overcapacity and overproduction lead to economic recession. Unemployment grows, markets shrink, discontent deepens, and small and not so small businesses perish. The corporate capitalist system begins to devour itself.
As the pyramid increasingly trembles from reactionary victories, some of the less myopic occupants of the apex develop a new appreciation for the base that sustains them. They advocate granting concessions to those below. But the more reactionary free-marketeers will have none of that. Instead they press ever forward with their backward agenda. If demand slumps and the pie expands only slightly or not at all, that is quite all right as long as the slice going to the moneyed class continues to grow. If profits are going up, then the economy is “doing well”—even if the working public is falling behind in real wages and living conditions, as happened during much of 2001–2007.
The state has two roles that have been readily recognized by political thinkers as varied as Adam Smith and Karl Marx. First, it must provide those services that cannot be developed entirely through private sources: a national defense, a dependable currency, postal service, roads, ports, canals and the like. Second, the state protects the moneyed and propertied interests from the have-nots; this is the capitalist class-control function we have been discussing in this and the previous selection.
But there is a third function of the capitalist state not usually mentioned. It consists of preventing the capitalist system from devouring itself. We have witnessed how this self-destruction might happen in places like Argentina during the 1990s when free marketeers stripped enterprises for massive profits, leaving the entire economy in shambles. Then in the United States there was the multi-billion-dollar plunder and theft perpetrated against the investor class itself by corporate conspirators in Enron, World-Com, Harkin, and a dozen other companies. Instead of making money by going through the trouble of manufacturing and selling products, the corporate predators dip directly into the money streams of the system itself, using every subterfuge and fraud in the doing.
I would suggest that a major difference between the Democratic and Republican parties is that the Democrats recognize this third state function and the Republicans—or their more militantly reactionary wing—refuse to be bothered about it. Indeed some of their key players, for instance, Bush Jr., Dick Cheney, and Ken Lay, were directly involved in the plunder that turned rich successful enterprises into sheer wreckage in order that a few might pocket billions in ill-gotten gains.
The state best protects the existing class structure by enlisting the loyalty and support of the populace. This is accomplished by keeping an appearance of popular rule and neutrality in regard to class interests, and by playing on the public’s patriotic pride and fear, conjuring up images of cataclysmic attack by foreign forces, domestic subversives, communists, and now Islamic terrorists.
Having discerned that “American democracy” as professed by establishment opinion makers is something of a sham, some people incorrectly dismiss the democratic rights won by popular forces as being of little account. But these democratic rights and the organized strength of democratic forces are, at present, all we have to keep reactionary rulers from imposing a dictatorial final solution, a draconian rule to secure the unlimited dominance of capital over labor. Marx anticipated that class struggle would bring the overthrow of capitalism. Short of that, class struggle constrains and alters the capitalist state, so that the government itself, or portions of it, become a contested arena.
The vast inequality in economic power remains a threat to whatever little democracy we have. More than half a century ago Supreme Court Justice Louis Brandeis commented, “We can have democracy in this country, or we can have great wealth concentrated in the hands of a few, but we can’t have both.” And some years earlier, the German sociologist Max Weber wrote: “The question is: How are freedom and democracy in the long run at all possible under the domination of highly developed capitalism?” 18 That question is still with us. As the contradiction between the egalitarian expectations of democracy and the demoralizing realities of the free market sharpens, the state must act more repressively to protect the existing class inequities.
Why doesn’t the capitalist class in the United States resort to fascist rule? It would make things easier: no organized dissent, no environmental or occupational protections to worry about, no elections or labor unions. In a country like the United States, the success of a dictatorial solution would depend on whether the ruling class could stuff the democratic genie back into the bottle. Ruling elites are restrained in their autocratic impulses by the fear that they might not get away with it, that the people and the enlisted ranks of the armed forces would not go along. Given secure and growing profit margins, elites generally prefer a “democracy for the few” to an outright dictatorship. Rather than relying exclusively on the club and the gun, bourgeois democracy employs a co-optive, legitimating power—which is ruling-class power at its most hypocritical and most effective. By playing these contradictory roles of protector of capital and “servant of the people,” the state best fulfills its fundamental class control function.
Finally, it should be noted that much of what has been said of the state applies also to the law, the bureaucracy, the political parties, the legislators, the universities, the professions, and the media. In order to best fulfill their class-control functions yet keep their credibility, these players must maintain the appearance of neutrality and autonomy. To foster that appearance, they must occasionally exercise some critical independence and autonomy from the state and from corporate America. They sometimes save a few decisions for the people, and take minimally corrective measures to counter some of the many egregious transgressions against democratic interests. As insufficient and hypocritical as these concessions are, they still sometimes lead to substantive gains in the struggle for social democracy.
24 SOCIALISM TODAY?
The structural problems of capitalism are not likely to solve themselves. What is needed, some say, is public ownership of the major means of production and public ownership of the moneyed power itself—in other words, some ample measure of socialism. But can socialism work? Is it not just a dream in theory and a nightmare in practice? Can the government produce anything of worth?
Indeed it can. Private industries such as railroads, satellite communication, aeronautics, the Internet, and nuclear power exist today only because the government funded the research and technological development, and provided most of the risk capital. The great scientific achievements of numerous universities and government laboratories during and after World War II were the fruits of federal planning and not-for-profit public funding. We already have some socialized services and, when sufficiently funded, they work quite well and less expensively than private ones. Our roads and some utilities are publicly owned and sustained, as are our bridges, ports, and airports. In a few states so are liquor stores, which yearly generate hundreds of millions of dollars in state revenues.
There are credit unions and a few privately owned banks like the Community Bank of the Bay (Northern California) whose primary purpose is to make loans to low- and middle-income communities. We need public banks that can be capitalized with state funds and with labor-union pensions that are now handled by private banks. The Bank of North Dakota is the only one wholly owned by a state. In earlier times it helped farmers who were being taken advantage of by grain monopolies and private banks. Today, the Bank of North Dakota is still an important source of reasonable credit for farmers, small businesses, local governments, and college students. Other states have considered creating state banks, but private banking interests have blocked enactment.
Often unnoticed is the “third sector” of the economy, consisting of more than 30,000 worker-run producer cooperatives and thousands of consumer cooperatives, 13,000 credit unions, nearly 100 cooperative banks, and more than 100 cooperative insurance companies, plus about 5,000 housing co-ops, 1,200 rural utility co-ops, and 115 telecommunication and cable co-ops. Employees own a majority of the stock in at least 1,000 companies.19 Labor unions in the construction industry have used pension funds to build low-cost housing and to start unionized, employee-owned contracting firms.
There are also the examples of “lemon socialism,” in which governments in capitalist countries have taken over ailing private industries and nursed them back to health, testimony to the comparative capacities of private and public capital. In France immediately after World War II, the government nationalized banks, railways, and natural resources in a successful attempt to speed up reconstruction. France’s telephone, gas, and electric companies were also public monopolies. Public ownership in that country brought such marvels as the high-speed TGV train. The publicly owned railroads in France and most of western Europe work far better than the privately owned ones in the United States.
The state and municipal universities and community colleges in the United States are public and therefore “socialist” (shocking news to some of the students who attend them). Of these some are among the very best institutions of higher learning in the country. Publicly owned utilities in this country are better managed than investor-owned ones; and since they do not have to produce huge salaries for their CEOs and big profits for stockholders, their rates are lower and they put millions in profits back into the public budget, saving the taxpayers money. Then there is the British National Health Service, which costs 50 percent less than our private system yet guarantees more basic care for the medically needy. Even though a Tory government during the 1980s imposed budget cuts in an attempt to undermine the public system, a majority of Britons still want to keep their socialized health service.
Free-marketeers in various countries do what they can to defund public services and eventually privatize them.20 Privatization is a bonanza for rich stockholders but a misfortune for workers and consumers. The privatization of postal services in New Zealand brought a tidy profit for investors, wage and benefit cuts for postal workers, and a closing of more than a third of the country’s post offices. Likewise, the privatization of telephone and gas utilities in Great Britain resulted in dramatically higher management salaries, soaring rates, and inferior service. The problem for private investors is that public ownership does work, at least in regard to certain services. A growing and popular not-for-profit public sector is a danger to the free-market system.
Most socialists are not against personal-use private property, such as a home. And some are not even against small businesses in the service sector. Nor are most against moderate income differentials or special rewards to persons who make outstanding contributions to society. Nor are they against having an industry produce a profit, as long as it is put back into the budget to answer the needs of society. Not just the costs but also the benefits of the economy should be socialized.
There is no guarantee that a socialized economy will always succeed. The state-owned economies of Eastern Europe and the former Soviet Union suffered ultimately fatal distortions in their development because of the backlog of poverty and want in the societies they inherited; years of capitalist encirclement, embargo, invasion, devastating wars, and costly arms buildup; poor incentive systems, and a lack of administrative initiative and technological innovation; and a repressive political rule that allowed little critical feedback while fostering stagnation and elitism. Despite all that, the former communist states did transform impoverished countries into relatively advanced societies. Whatever their mistakes and political crimes, they achieved—in countries that were never as rich as ours—what U.S. free-market capitalism cannot and has no intention of accomplishing: adequate food, housing, and clothing for all; economic security in old age; free medical care; free education at all levels; and a guaranteed income. Today by overwhelming majorities, people in Russia and other parts of Eastern Europe say that life was better under communism than under the present freemarket system.21
American socialism cannot be modeled on the former Soviet Union, China, Cuba, or other countries with different historical, economic, and cultural developments. But these countries ought to be examined so that we might learn from their accomplishments, problems, failures, and crimes. Our goal should be an egalitarian, communitarian, environmentally conscious, democratic socialism, with a variety of participatory and productive forms.
What is needed to bring about fundamental change is a mass movement that can project both the desirability of an alternative system and the great necessity for change in a social democratic direction. There is much evidence indicating that Americans are well ahead of political leaders in their willingness to embrace new alternatives, including consumer and worker cooperatives and public ownership of some industries and services. With time and struggle, we might hope that people will become increasingly intolerant of the inequitable free-market plutocracy and will move toward a profoundly democratic solution. Perhaps then the day will come, as it came in social orders of the past, when those who seem invincible will be shaken from their pinnacles.
There is nothing sacred about the existing system. All economic and political institutions are contrivances that should serve the interests of the people. When they fail to do so, they should be replaced by something more responsive, more just, and more democratic. Marx said this, and so did Jefferson. It is a revolutionary doctrine, and very much an American one.
NOTES
1. New York Times, 22 August 1996.
2. See the discussion in Michael Parenti, Superpatriotism (City Lights, 2004) 111–132.
3. Frank Scott, editorial in Coastal Post (Marin County, California), 1 February 1996.
4. Robertson quoted in Nation, 10 January 2000. See also Thomas Frank, What’s the Matter with Kansas? How Conservatives Won the Heart of America (Henry Holt, 2004).
5. See selection 31, “The Rational Destruction of Yugoslavia.”
6. For a discussion of how events in Allende’s Chile have been misrepresented in the United States, see Michael Parenti, Inventing Reality, 2nd ed. (Wadsworth/Thomson, 1993), 143–147.
7. McGovern quoted in Parade, 9 August 1987.
8. Anthony Summers, Official and Confidential (Putnam, 1993); Robert Morrow, Firsthand Knowledge (S.P.I. Books, 1993); Pete Brewton, The Mafia, CIA & George Bush (S.P.I. Books, 1992); Peter Dale Scott and Jonathan Marshall, Cocaine Politics (University of California Press, 1991).
9. Ben Lowe, in Guardian, 5 December 1990.
10. La Repubblica, 9 April 1995; Corriere della Sera, 27 and 28 March, 12 April and 29 May 1995.
11. Karl Marx, The Eighteenth Brumaire of Louis Bonaparte (various editions).
12. New York Times, 18 January 1977.
13. See Gary Webb, Dark Alliance: The CIA, the Contras, and the Crack Cocaine Explosion (Seven Stories Press, 1998).
14. Michael Parenti, “Yeltsin’s Coup and the Media’s Alchemy,” in Michael Parenti, Dirty Truths (City Lights, 1996), 133–140.
15. Once again, in case the reader missed it in the last selection, “plutocracy” refers to rule by the wealthy or to rulers who favor the wealthy interests.
16. Washington Post, 9 March 1980.
17. Frank Kofsky, Harry S. Truman and the War Scare of 1948 (St. Martin’s Press, 1993), 190.
18. Brandeis quoted in David McGowan, Derailing Democracy (Common Courage, 2000), 42;Weber in H. H. Gerth and C.Wright Mills (eds.), From Max Weber: Essays in Sociology (Oxford University Press, 1958).
19. Christopher Gunn and Hazel Dayton Gunn, Reclaiming Capital: Democratic Initiatives and Community Development (Cornell University Press, 1991).
20. See for instance, Tor Wennerberg, “Undermining the Welfare State in Sweden,” Z Magazine, June 1995.
21. See selection 30, “The Free Market Paradise Liberates Communist Europe”