The Banks vs. Democracy (2 of 3)

We’ve been discussing how the banks assault democracy. The system which has been compiling for decades now, and which has reached its fullest development with the bailouts, is corporatism.

 

According to classical economic theory, the feudal stage of development was based on unproductive parasites squatting on land, resources, serfs, and slaves, extracting rents from these, and hoarding the surplus. “Capitalism”, where the property owner was himself a dynamic engine of productivity who would use the surplus he extracted as investment toward further productivity, was supposed to obliterate feudal vestiges as part of his historic mission.

 

Of course, this romantic Randian vision of the capitalist was always a caricature, but in theory it should have contained a grain of truth. Surely a capitalist economy should have been able to keep the capital in circulation among at least quasi-productive enterprises. That’s what their ideologues always claimed it would do.

 

But instead, out of the internal contradictions of capitalism, namely its propensity to overproduce even as it underconsumes (because in exploiting the worker it liquidates its own consumer base), a new feudal class arose in the form of the modern finance sector. It started out claiming to facilitate capital distribution so that money could shift from the overinvested sectors and regions to underinvested ones, and in this way overcome the contradiction.

 

This was inherently a kind of scam or ponzi scheme, since the contradiction was endemic and financial markets could only protract the process, not overcome it. But right from the start the sector went beyond its distributive function and invented casino games to play with the money it was handling. Soon money was flowing in which never had the pretense of seeking a real investment, but was only seeking to spin the Roulette wheel. Soon the banks were disparaging, neglecting, and outright abandoning the original, allegedly “productive” function they had been inaugurated to fulfill.

 

Soon there was a vast casino, flush with capital, squatting on the back of the real economy. Pumping from both veins and arteries, it sucked resources from the country. It prevented rather than facilitated any rational capital distribution. On the contrary it generated monstrous distortions in the economy, encouraging money to flow wherever ponzi schemes could be erected in the form of asset bubbles. These assets could be real but fixed, like land, or phony, like stocks and securities. In no case were they generating new, productive value.

 

Every racketeer buys politicians and regulators, but finance lobbying is perhaps the most pernicious, as it has such an easy cash flow by the nature of its business, and its crimes can more easily be enabled by the government without there being obvious scars in the short run. (In an episode of The Simpsons the crooked pol tells the timber lobbyist, “People are going to notice those trees are gone”. That’s not often immediately the case with the kinds of forests the banks hack down.) Plus the finance sector, as wirepuller for all the money flows, naturally comes to orchestrate many of the crimes of every other sector.

 

(It’s bizarre when somebody like Alan Greenspan affects great surprise over what has happened. By the market fundamentalists’ own ideological premise they should have expected looting, since it is indeed in the financiers’ interest and is therefore “rational” from their point of view. To ignore this they had to have believed their own hype about there being no class war or systemic organized crime, that we instead have a capitalist Volksgemeinschaft. You’re not supposed to snort your own stuff.

 

Still, in the long run there’s really something just absolutely weird and self-defeating about the lobbying ideology. The thing that’s most broken, absolutely beyond repair, is the institutionalized psychopathy of it. That level of greed and selfishness. By now every corporate interest is objectively incapable of looking at anything other than from the point of view of the most deranged short-term selfishness. I say “short term” because they seem oblivious and unconcerned with even their own long term profit prospects and political prospects. Their own refusal to do anything but hunker in the bunker in the face of any reform proposal, anything which could possibly benefit the people, who are after all the consumers these businesses depend upon, is suicidal. The same is true of their resistance to anything which could reform the economy, which could try to find a way toward new productive sectors.

 

In both cases they just want to squeeze the last drops of blood out of a dying man rather than delay gratification for a moment or accept one marginally smaller payday in order to restore him to health, and never mind that his revived labor would over the long run produce far more “profit”. They don’t care. They demand, they shriek, for whatever little bit they can get right now.

 

This can never be fixed. The rackets (and any sector which has reached the level of a powerful lobby is a racket) have to be absolutely destroyed.

 

They’ve come to these conclusions themselves, which is why they’ve bet everything on a feudal terror state, as I describe below.)

 

Perhaps most tragically, as the salaries and “bonuses” paid by the sector have bloated beyond the levels of obscenity, while the absolutely despicable mainstream media has whitewashed this obscenity and presided over the reinvention of the fat, greedy banker as sexy “master of the universe”, a generation of intelligent, potentially very constructive people was lost to crime. Those who could have been creative scientists, engineers, journalists, teachers, professionals working for the public interest, instead herded themselves onto Wall Street. (The equally despicable corporatized universities help to organize this cattle drive).

 

What was the opportunity cost of this decimated potential? All the talent which whored itself out to become “talent”? When the Nazi Einsatzgruppen liquidated the intelligentsia and professional classes of Poland and the occupied regions of the USSR, they were accomplishing a similar, just more violent, cleansing.

 

In the end, corrupting politics, academia, and media/entertainment, that is the propaganda nexus, finance “capitalism”, which was hardly real capitalism in the first place, and has long since solidified into a feudal parasite structure, becomes so meshed with the functioning of the state that they’re a single, symbiotic co-organism.

 

Corporatism is the economic doctrine associated with fascism in the political realm. Where the economics of it comes first, and then runs into political trouble, the politics will follow. Finance monopoly capitalism has become trapped in its own bottleneck. It depends completely upon exponential debt to prop up an otherwise dispossessed zombie middle class, and this debt/growth depends upon cheap, plentiful oil.

 

Now that neither is any longer sustainable through ”ordinary” exploitative policy, policy has to become extraordinary. Therefore, to counter Peak Oil, the corporate government has embarked upon the Global War on Terror. To counter the political backlash from the collapse of the populace into serfdom, the state must become totalitarian. It must use surveillance and database technology and professional terror (provided by the security-industrial complex) to enforce this from the top down, and it must rile up the lumpenproletariat mob as “teabaggers” in order to provide mob terror from below and keep the serf class fighting among itself. (The GWOT is supposed to function dialectically by both securing the oil and the globalization markets while enforcing “patriotic” conformity at home. Thus it does double duty in propping up the system. It’s also the training ground for violence cadres. The real intended deployment front for mercenaries from Blackwater and others is right here in our cities.)

 

So the banks sit atop the pyramid, the corporate state heirarchy, with the rest of the corporate welfare recipients radiating out and down.. They intend to ride a boom-bust roller-coaster as long as they can. They’ll play their own casino games and collect fees from all the other players, and then via the government hand themselves bailouts during the crashes. When this can no longer be sustained politically, they’ll resort to oppression and terror.

 

So we see the dying of democracy. It was first corrupted beyond what had been possible under earlier economic, technological, and communications conditions. By now it has been completely degraded into a mere corporatist pseudo-democracy. Eventually they’ll attempt a final, overt, de jure coup, worthy of the banana republic we’ve already become.

 

(Does anybody really doubt, if the Republicans can ever get the White House back, that next time they will be dead set on hanging onto it no matter what they have to do? Especially if their 2012 candidate is a Man on a Horse like Petraeus? Of course that would really be Wall Street making that decision. The only reason I say “Republican” rather that “Democrat”, given their identical solicitude for the banks, is that on the whole Reps are aggressive, Dems are cowards, so if I were a corporatist coup plotter I’d have confidence in Reps and not Dems.)