Sirotablog

David Sirota is a political journalist and nationally syndicated newspaper columnist at Creators Syndicate. David writes about political corruption, globalization and working-class economic issues often ignored by both of America's political parties.

  • September 26, 2008 1:59 PM

    Back In the USSR - Where Amerika Has Always Been

    A number of commentators and politicians have noted that the proposed financial bailout is, in effect, a socialization of Wall Street. They claim that such socialism is new in the good ol' commie-hatin' U.S. of A. But as my weekly syndicated newspaper column today shows, it's far from new. America has always been the United States' Socialist Republic, or Amerika for short. And the problem we are facing now is not socialism unto itself, but our unique brand of kleptocratic socialism - socialism whose objective is private theft.

    Since I worked for Bernie Sanders in the late 1990s, I have been fascinated/disgusted by those right-wing politicians and pundits who at once red bait when anyone proposes, say, an expansion of Medicare, yet who bill themselves as free-market capitalists as they vote for gross defense, oil and drug industry subsidies, and for trade policies which include strict patent/copyright provisions that use government authority to rig the market. They pretend that America isn't Amerika - even though we have long exhibited many socialist tendencies - and Sanders himself took to television this week to point out precisely that hypocrisy:

    Where we differ with the rest of the world is in our socialism's objective.

    In Amerika, we socialize private losses, and privatize public gain. We, for example, are about to socialize $700 billion in Wall Street losses, while continuing to fund the research and development of pharmaceuticals, which we then give away to drug companies so that they can sell the finished products back to Americans at the highest prices in the world. The examples of this dichotomy are endless - and it's clear what has forged it - our campaign finance system. A political system run by monied elites is one that socializes on behalf of those monied elites - and no one else. President Bush could have given a speech a few nights ago and replaced all the language about a financial crisis with language about the health care crisis - and he could have done it years ago. But in our kleptocratic socialism, the only "crises" are those that affect the kleptocrats.

    If there is a silver lining out of this moment of economic crisis, it is that we are - finally - having a discussion about this dichotomy, and the immorality of it. The fact that, for example, Sen. Chris Dodd (D-CT) - one of the largest recipients of financial industry cash - feels pressured to try to make sure taxpayers get equity stakes in financial firms as part of this bailout represents some modicum of progress in opening up a wider debate about what our political system is and is not, even if it is unstated progress. Similarly, the fact that John McCain is rhetorically pretending to support regulation - as disingenuous as that rhetoric is - suggests that the parameters of the economic debate are shifting before our eyes.

    The question we face on the cliff of this economic crisis is not whether we're becoming a socialist country or not - Amerika has been a socialist country since back when our government handed over large swaths of the Rocky Mountain west to private railroad interests. The question is what KIND of socialism are we going to be - one that values kleptocrats, or one that values We the People? If you want to demand that question be answered with the latter, then sign Sanders' letter about the bailout here.

    You can read the full column here.

    The column relies on grassroots support, so if you'd like to see my column regularly in your local paper, use this directory to find the contact info for your local editorial page editors. Get get in touch with them and point them to my Creators Syndicate site. Thanks, as always, for your ongoing readership and help contacting local editors. This column couldn't be what it is without your help.

    Posted by David Sirota
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    Tags: wall street

Discussion

  • havasuesq [TypeKey Profile Page] :

    Why do you and other writers lately keep playing fast and loose with the word "socialism" ?
    There's never been any socialism in this country. Gore Vidal once said that the Democrats and Republicans were merely the left and right wings of the Oligarchy party. I think he missed the point too. The majority of us live in a plutocracy which more and more shows us its crueler totalitarian face.

    Posted on September 27, 2008 12:19 PM
  • Sue Hagmeier [TypeKey Profile Page] :

    Here's another way to look at it:

    I've read that in a casino, money is referred to as "product." That concept, that money is a product, the product, permeates our economy, and is at the core of the current "troubles." That's right, the American economy is being managed like a casino. The house is the only player that always wins, and we're not the house.

    Any calculation of what we owe, what we pay and how our income and wealth has changed necessarily lowballs our obligations, overstating the financial health of most Americans. Even someone with no mortgage and no credit debt of their own pays debt service all the time, to over-leveraged utilities and other companies. More ominously, as real income stagnated or fell, the housing market seemed to shore up homeowners' wealth. Middle class workers were given credit instead of pay.

    What happened? What characterizes the transformation of our economy is that it is designed now to concentrate wealth and then remove it from meaningful circulation, not to produce goods and services, and not to support the well-being of those who do. Deregulation first of natural resource extraction, then of media ownership, then of utilities, and finally of banking and insurance and all things financial gave these groups license to sell nothing for something.

    First, we define a corporation's fiduciary responsibility as being owed only to the shareholders. Then, the Ken Lays of the world combine greed with duty to do whatever it takes to maximize their take.

    This isn't a new concept. It's colonialism with computers. It's what colonizers did every time they conquered and occupied a land and people. It's an extraction economy, but the resource being extracted is the wealth of the middle class instead of natural resources.

    In the Northwest in the '70s and '80s timber companies colonized us when they figured out that they could make more money by shutting down our mills while continuing to clearcut our forests, and then by shipping the raw logs elsewhere to be finished and sold.

    Then, realizing that the way to make big money was to sell nothing for something, Enron colonized us, because they could extract more money by selling less electricity. And they exploited tax and rate regulation loopholes to ship even more "product" to Texas. We are colonized by Walmart, coming to our cities and towns to extract "product" and ship it back to Bentonville. And the oil companies know they have us over a barrel. They make more money selling less oil. They want more leases not to drill for more oil but to list them as assets, to both inflate their stock prices and to generate more "product" by borrowing against those assets.

    Bankers figured out how to sell essentially fictional funds, making the whole financial system into a pyramid scheme.

    Insurance companies figured out that they were in the business of making money, not providing protection. If they could collect premiums, play around in the games the banking industry invented, and deny claims, they could generate lots of "product."

    Media? Media "consolidation" was funded by borrowing. That led to cost cutting as every outlet had to pay debt service. This led to the death, or at least morbidity, of local news.

    And then there's government money. They see those big pots of "product" in public funds and they want to get some. Let's privatize schools, the military, prisons, roads and anything else we can think of. Then, when we get inferior service for the cost, we can blame the invisible hand of the market.

    The Wisdom of the Market was preached like a religion. Seriously, like a religion. No evidence, but you have to believe.

    The tax system increasingly rewarded ("incentivized?") investment more than work. As corporations and investors paid a smaller share of taxes, ordinary workers picked up the slack or saw the benefits that taxes buy deteriorate or, usually, both.

    Along the way usury, once a sin, became a virtue as credit became central to the economy. Stockbrokers made the economy "vibrant" while teachers and school custodians "fed at the public trough." No, the monetary rewards of exploiting this economy were not enough. Gordon Gecko had to claim to be a saint, too, morally better than us shmos who don't have what it takes to play in his league.

    And now we're looking at "bailouts." The common good wasn't being looted fast enough by a war built for profiteers. It wasn't being looted fast enough by usury. Not fast enough by looting our health. It wasn't enough to privatize funds the government already had. No, now the plan is to shore up this Ponzi scheme with invented/borrowed money.

    Privatize and concentrate wealth and gain, and socialize obligation and loss. What the hell does that have to do with democracy?

    Posted on September 27, 2008 2:57 PM
  • JWVerez [TypeKey Profile Page] :

    Hi Sue,

    Don't forget that Big Timber was in bed with Big Oil when they were fighting to ban real competition such as hemp which would have empowered the local and rural communities at large. The market is RIGGED.

    HEMP 4 VICTORY PLEASE !!

    Posted on September 29, 2008 3:12 PM

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