The Science of Corrosive Inequality

By Nick Partyka

Pictured: "Sharing the Wealth" (Oil on Canvass 66" x 48") by Mark Henson

As the Presidential campaign season begins to get into full-swing, inequality will become a prominent topic, and misleading conventional narratives will abound. Both the presumptive nominees of the two major political parties have addressed this topic at length already, and will certainly have much more to say as the general election phase kicks-off. Inequality is a prominent topic because we are still dealing with the fallout from the 2008 financial crisis that spawned the Occupy Wall-Street movement, which did much to put the issue of economic and political inequality back on the table for discussion. This is why the topic came up in the 2012 Presidential election cycle, and why during this election cycle one candidate in the Democratic Party's primary was able to attract a very large following by focusing predominantly on this issue. The success of both Bernie Sanders and Donald Trump shows that the issue of inequality, and its various social, political, and economic effects, still resonates deeply with large portions of the electorate on both sides of the mainstream partisan divide. This is the case, principally, because a great many non-elite Americans are still living with the economic consequences of the financial crisis and the ensuing Great Recession.

Inequality, political and economic, not only helped to inflate the bubble whose bursting caused the crash, but it also determined in large measure who benefited from the bailouts and the "recovery". Rising inequality from the 1970s on helped funnel more and more wealth to the top of the income scale. These people spend their money very differently from others. When this group has surplus income, they are very likely to purchase financial instruments. As more and more wealth was channeled into their hands by the economic and political policies of neoliberalism, as championed by the likes of Reagan and Thatcher, the demand for financial products grew correspondingly. Further, after the financial sector was deregulated in the late 1990s, this process of financialization only picked up speed. Once home mortgages were securitized, that is, made into financial instruments, the stage was set for the collapse. After the crash, elites used their political and economic clout to divert bailout funds from America's proverbial 'main streets' to Wall-Street. This, combined with fiscal policy choices, that is, the choice by bourgeois politicians not to use it as a tool to combat unemployment, is why the so-called "recovery" has not extended all that far down from the top of the income scale.

In order to know what kinds of solutions are necessary to address the problem of inequality it is important to know what kinds of problems it produces, as well as their scale. Scientists and scholars studying inequality, and its various impacts, have revealed a number of striking conclusions about the nature and extent of the social, political, and economic, impacts of inequality. When taken together these various research results paint a very clear picture of the corrosive effects of economic inequality on society, economy, and democratic politics. The totality of these wide-ranging effects constitutes a significant threat to a society aiming to be democratic and egalitarian. In what follows, we will examine some of these interesting studies and their results to see what they reveal about the multifaceted impacts of inequality on persons, societies, and democracy. What we will find is that the scale of the problem far outstrips the scale of most of the mainstream solutions proposed; even those put forward by the self-proclaimed (though quite incorrectly)"socialist" candidate in the Presidential primaries.

Piketty on Inequality

It seems a safe bet that few would have predicted the overwhelming success that a hefty tome on economic inequality by a French economist would achieve in the spring of 2014.[1] The 2011 Occupy Wall-Street movement did much to bring the issue of economic inequality in society, as well as its many social and political effects, into the public consciousness, as well as into political debates. Nevertheless, Thomas Piketty's book, and its success, caught many totally by surprise, and set off a vigorous debate, and vitriolic reaction, upon its translation into English. Both liberals and radicals pointed to his work as evidence, as confirmation, of what they have been saying for many years. On the other side, conservatives seemed wither to accept his findings, but dismiss his policy suggestions, or to find technical "flaws" with his data or methodology as a way of undermining all his conclusions. Using mainly tax-return records, from several countries, Piketty's work presents the most comprehensive view of the historical evolution, and structure, of income inequality throughout the industrialized world. Several highly significant, and well-established, conclusions result from his research.

First, Piketty confirms empirically several notions the left has asserted, namely, income inequality in the United States has returned to a historic high level, and it has been rising since the 1970s. The level of income inequality in the United States, especially the growth of incomes at the very top of the income spectrum, has, according to Piketty, revived the social significance of capital in the 21st century, and is bringing back the more patrimonial economy that dominated earlier centuries, until the period between 1914 and 1975. That is, once dynamic and equalizing societies are now increasingly reverting to the kinds of more rigidly defined, and largely hereditary, social relationships and attitudes that dominated the economy and society of the Gilded Age, as well as preceding centuries.

Second, and very importantly, Piketty's research provides much needed context for perceptions of growth, both of capital and wages. What Piketty's historical research reveal is that average annual growth rates, even in this most recent and most fecund epoch, are actually rather small. Average annual growth rates for the most productive societies, in the most productive era, are still only about 1 - 1.5% per annum. Capital, on the other hand, has grown on an average of 4-5% per annum over the same historical period. This observation gives rise to one of Piketty's fundamental conclusions, namely the law (r>g).[2] This law is the biggest source of divergence in market economies, because it directly implies that a capital, however small, will with time invariably become a large capital; exogenous shocks, natural catastrophes, and acts of God notwithstanding. What this law also implies, and very significantly, is that the economic and social landscape of the mid-20th century is an economically and historically unique, and likely non-replicable period.

Why did economic inequality decline in the United States during the middle part of the 20th century? Piketty's answer is that this decline was largely the result of the confluence of historical events, namely the World Wars and the Great Depression. It is the historical conjuncture of these events in this period, as well as the political and social response to them, that accounts for the uniqueness of this era. Piketty's fundamental law (r > g) was able to be broken in this period because of the exigencies of combating foreign military foes and domestic economic woes. One of the most significant results of the efforts to combat both is that working people in the Unites States accumulated during the war years the largest stock of disposable income ever. It was the spending of this money, as well as exploiting the United States' position as global hegemon, that fueled the post-war economic boom up until the mid-1970s. When the economic effects of the 1914-1945 period wore off, inequality began to rise again.

Inequality & Social Mobility

One of the major implications of Piketty's conclusions was on the topic of social mobility in the United States. Many on the left have been arguing for some time that social mobility in America is much lower than commonly thought, and Piketty's data on inequality seems to support just such an argument. If economic inequality in a society is very high, and growing, then social mobility is likely to be low. The reasons for this are that as economic inequality increases, so the economy comes to be more and more patrimonial, and thus economic divisions come to settle more and more into sharp caste divides. This is, of course, because in a capitalist society, income determines the extent of an individual's, or a family's, ability to consume, that it, their income determines the range of their consumption choices.

One thing Piketty's work demonstrated clearly was just how stark income inequality is in America. What he also, very importantly, showed that the growth of inequality in the United States since the 1970s is due principally to the rise in the incomes of the wealthiest 1%, and .1% of income earners. [3] This increasing concentration of wealth among the wealthiest certainly bodes ill for high levels of social mobility. One of the main features of a patrimonial economy is that, at least from the point of view of social mobility, it is not dynamic. Piketty appeals to interesting evidence from 19th century Victorian literature to demonstrate this fact. In a highly patrimonial economy the ability of individuals at the very bottom of the economic scale to advance into the "middle-classes", let alone into the top 10% or 1%. A patrimonial economy also makes it very easy for those who have accumulated wealth to be fairly confident of never falling below the "middle classes", if one falls out of the elite classes at all. One of the most striking features, at least to modern readers, of Piketty's use of the economic evidence in Victorian novels, is that with conservative management an accumulated fortune is unlikely to be dissipated, and thus to be transmitted to the next generation.

The notion that classes, or castes, define American society is anathema to many pundits and commentators. Thus the vigorous attempts to rebut, dispute, and discredit Piketty's work and conclusions. This image of a patrimonial economy does not square well with the cherished nostrum of capitalist society as dynamic and highly socially mobile. To some extent this belief in mobility is evidenced in empirical studies. What these studies often compare are the economic, or educational, outcomes achieved by parents and their children. What they reveal is a strikingly low-level of social mobility, at least as defined by the "rags to riches" mythos of America. Indeed only .2% of those born into the bottom 20% of the income scale will end up rising into the top 1% of income earners. And, as one might expect, the picture is more bleak for persons of color, and other marginalized groups.

What some researchers found is that the picture of social mobility in America is much more complex than simplified narratives from right or center-left suggest. The reality for the majority of Americans is rather fluid, in that people enjoy bouts of relative prosperity and affluence, as well as bouts of relative poverty and deprivation. If such a picture of social mobility were not shocking enough, research taking a different tack suggests that social mobility is actually much lower that the picture presented by inter-generational studies mentioned above, and has been very low throughout history. [4] Economist Gregory Clark studied the prevalence and endurance of 'elite' surnames in elite institutions as a way of measuring social mobility with societies.

Using a variety of sources, including Census records, tax returns, death records, graduation records, and others, Clark makes a case that the rate of social mobility in the United States is much lower than contemporary estimates suggest. He argues that the common perception of very slow long-term mobility is more accurate than the estimates presented by social scientific research. For the case of the United States, Clark first identifies certain elite surname groups, as well as underclass surname groups. Then, he looks to test the prevalence of both groups among occupations identified as high status. Clark uses membership lists, mainly from professional associations, of doctors and lawyers as the high status occupations. Among the elite surname groups in America Clark lists Ashkenazi and Sephardic Jews, what he calls the 1923-1924 rich, and pre-1850 Ivy League graduates. The underclass groups are black Americans, and a groups Clark terms New French settlers. What his research concluded was that elite surnames show a very strong persistence, between 0.7 and 0.9, over the long-term, that is, for Clark, at least three generations.[5]

Another very interesting body of research suggests that humans have innate physiological and physiological reactions to the particular stresses induced by scarcity, by having less than is needed to make ends meet. Researchers found that these reactions impair humans' long-run decision making faculties, even if boosting short-term focus, resulting in patterns of behavior that lead the poor to be likely to remain in poverty. [6] The experience of scarcity causes people to 'tunnel', that is, focus on immediate goals and concerns, and thus to neglect many other important goals or other things one values. While this focus does yield an important benefit in increased productivity, the long-run consequences can lead to what researchers call a 'scarcity trap'. As one tunnels in on pressing immediate goals, the things that fall outside ones view are neglected, and thus become shocks as they suddenly appear on the tunnel of the person experiencing scarcity. As one reacts to each successive shock, even when "shocks" are predictable and routine events, one resorts to increasingly dodgy schemes to make ends meet. This is how people end up in, and unable to extract themselves from, one or another of the many kinds of scarcity trap.

This is only compounded by the fact that the experience of scarcity imposes a kind of tax on humans' cognitive capacities, such that as scarcity increases one comes to have less and less of the most important mental resources for escaping scarcity. Will-power is a finite resource, and the effects of scarcity are such that this resource is heavily depleted by scarcity, and the tendency of humans to psychologically obsess about their deprivations. Moreover, scarcity erodes intellectual capacities, in some studies the effect was the equivalent of as much as 13 or 14 IQ points. Thus, as scarcity taxes one's cognitive capacities, shocks continue to arise, and one must constantly react, always seemingly one step behind. Thus, one will end up making poorer, more impulsive decisions that meet short-term needs, but at the expense of the individual's long-term goals and interests. Scarcity, in this way, perpetuates scarcity, leading people to remain locked into debt and poverty. Unfortunately, even when poor people do escape poverty, or debt, they often fall back in because they lack any kind of buffer or cushion. The truth is that the poor tend to stay poor because of the physiological and psychological effects of the experience of scarcity, and the rich tend to stay rich because of the effects of abundance.

Inequality and Personality

Beyond its effects on the rates of social mobility, and how this affects people's lives, inequality also seems to change who people are on a deeper level. Inequality has some interesting, and disquieting, impacts on what people think, their attitudes, their moral values, their perceptions of situations and of other people, and more. Wealth, or the lack thereof, impacts on individual's personality in many ways. It directly provokes the question of whether the wealthy and the poor are qualitatively different sorts of persons, or whether they are constructed that way by their social environment. The results of empirical research suggest that the experience of inequality, from the top or the bottom of the economic scale, has profound effects on our personalities. The clear implication is that our personalities are in some very significant ways shaped by the contingent realities of the social environment.

In the wake of the 2008 Great Financial Crisis, and its aftermath, came much scorn, and condemnation of Wall-Street's recklessness and greed. The Great Recession brought increased scrutiny to the 1% as a class, and to the mis-deeds and cupidity of the finance industry and financial institutions in the lead-up to and during the 2007-2008 Crisis. The treatment of the whole matter by the federal government angered many citizens, and further fueled the public's fury and indignation. One of the threads that emerged from this storm of vitriol that was poured on Wall-Street bankers was comparing corporate CEOs to sociopaths. The callousness, selfishness, and nonchalance with which many in the financial industry profited from the crash which they themselves had both created and precipitated, even as others were being fired en masse, made many Americans think of corporate CEOs as basically sociopaths. Some pundits took this to the logical conclusion and compared clinical symptoms of sociopathic behavior to the characteristics of successful CEOs. As it turns out, a growing body of empirical research is suggesting that the wealthy are indeed very different from others, e.g. morally and emotionally, as a result of their wealth.

A series of creatively designed studies by researchers Paul Piff, Dacher Keltner, Michael Kraus, Stephane Cote, and a host of collaborators, has revealed some very interesting results about the moral and emotional differences of rich people from persons of lower social class. Piff and Keltner, et al , demonstrated in both naturalistic and laboratory settings that those of higher social class, i.e. the wealthy, are more likely to lie, cheat, steal, and break the law than their counterparts in lower social classes.[7] On the naturalistic side, they found that wealthier drivers, as determined by the model of the car, were more likely to illegally cut-off both other drivers at intersections and pedestrians at crosswalks. On the laboratory side, they found that in experimental simulations those of higher social class, even if artificially created, were more likely to lie, cheat, and steal in order to win prizes. Moreover, in experimental simulations, even those whose position of wealth and dominance had been engineered as part of the experiment, showed the signs of feeling entitled to their totally un-earned wealth. Other research found that those who had attitudes characteristic of social dominance were found to be more likely to come to feel entitled to their position in the inequality hierarchy, or to believe the "legitimizing myths" of inequality. [8]

Other studies have produced similarly striking results. One study showed that lower-class individuals were more "empathically accurate" than their wealthier counterparts. 'Empathic accuracy' here refers to the ability of persons to correctly judge or predict the emotional states of others. [9] They hypothesize that since poorer people have to rely more on others to get by, they become more accurate at judging other people's emotional states, since their success in obtaining cooperation depends on managing the emotions of others. In another study, Kraus & Keltner demonstrated that the wealthier subjects in their experiments were less likely to pay attention to others, as demonstrated by a prevalence of "disengagement cues", e.g. looking at one's cell phone while others are talking.[10] A further study revealed that the wealthier subjects were more likely to have a predominance of "self-oriented affect", that is, the rich are more likely to think about themselves before others. [11] In yet a further study, Stellar, Keltner, & colleagues, demonstrated that wealthier subjects were not only slower to feel compassion, but reported feeling less compassion, for others experiencing suffering.[12] Higher social status individuals were also shown in one experiment to be stingier than their less wealthy counterparts.

Inequality, in addition to warping the perceptions and sensibilities of the rich, also distorts the perceptions of the working-classes. Kraus, Piff, and Keltner found in one study that those of lower social class position were more likely to favor contextual explanations over dispositional ones, because of a perceived lack of personal control over the outcome.[13] This means that poorer people tend to explain, or rationalize, their own choices, or the events of their lives in terms of external causal factors, that is, factors over which they as individuals do not have control. This perceived lack of control is characteristic of how researchers Melvin Kohn, Carmi Schooler, and their collaborators, understand the concept of alienation.[14] Their research demonstrated important connections between inequality in levels of alienation between high and low status groups in the workplace. The difference between the high- and low-status positions in the workplace roughly matches the colloquial "blue collar", "white collar" distinction, where the latter type of jobs contain an abundance, and the former a paucity, of opportunities to exercise "occupation self-direction", that is, control over their work. Each of these groups was found to have a distinct set of values and social orientations associated with it.

The correlation between the social stratification position of lower-status workers within the firm, and the personal values, social orientations, and psychological functioning that predominate among these workers is troubling.[15] The results obtained by Kohn and Schooler, et al, demonstrate that the more alienated low-status group are more likely to have specific set of values, attitudes, and social orientations. In particular, more alienated, "blue collar", workers tend to take on personality traits like authoritarianism, conformity to authority, resistance to change, and a focus on the letter rather than the spirit of the law. This is in turn related to the lower levels of psychological functions, or intellectual flexibility, observed among the high-alienation, low-status workers. This research also shows that the observed connection between these traits and social-stratification position within the firm are mediated by the division of labor in the typical capitalist firm, whereby the low-status workers are denied opportunities to exercise self-direction at work. Of course, we should note that an individual's social-stratification position with the firm is in many ways correlated with, and even determined by, that individual's social class in society generally. This latter is not a conclusion issued by the research we've been discussing, but rather a more general observation about the fit, under capitalism, between low-status persons and those who perform the low-status work in society.

One very telling, and worrisome, result of the work of Kohn and Schooler, et al, is that alienation experienced in the workplace spilled over into the non-work life of workers, effecting their leisure time preferences. The rate of interest in discussing non-political matters was found to be consistent across both the high- and low-alienation groups. However, interest in discussing political topics was distinctly lower among the high-alienation group. Moreover, the intellectuality of the preferred leisure time activities among highly alienated workers was seen to be much lower than among their counterparts in the low-alienation group. As a further kind of informal test, the researchers conducted their survey in two separate parts. One part of the survey covered non-political topics, the other political topics. After controlling for Swedes' cultural tendency to comply with researches requests, they found, quite suggestively, that the political part of the survey was returned later on average by the high-alienation group. This specifically political withdrawal by the high-alienation, low-status workers will have profound implications for the well-being of political democracy.

Inequality & Health in both Individuals and Societies

A growing body of research in public health has shown that economic inequality is highly related to certain significant socials ills, e.g. high levels of violence, as well as higher rates of illness and early death among those of lower class position in society. Building off this work on the "social determinants of health", Richard Wilkinson presents an argument that societies with more inequality are also, e.g. less trusting, less cohesive, less sociable, more prejudiced, and more violent. [16] He begins by noting an apparent paradox. Modern societies are more wealthy and productive, and with more luxuries readily available, than most of our ancestors would have ever dreamed. He cites the example of indoor plumbing and hot and cold running water as luxuries often taken for granted. And yet, modern societies also appear rife with unhappiness, e.g. high rates of suicide and depression, illness, violence, and early death. Wilkinson links the sources of these manifestations of unhappiness with economic inequality and its social, as well as physiological, effects.

Wilkinson's work successfully showed that almost all the social problems that are indicators of unhappiness, are more concentrated in poor areas, and more common among poor people. He argues that, as a result of the "epidemiological transition", the most common causes of death for all in developed countries shifted from infectious diseases to degenerative diseases. What he found is that health is graded by social status, that is, largely by income. His results demonstrated that as income increased so did health, according to a range of metrics, and vice versa. He appeals to a range of studies to help show that social problems indicative of unhappiness are caused by the same sources of stress as chronic diseases. Wilkinson points to three main categories of psychological risk factors, namely, early childhood social and emotional development, being more socially isolated, and high or low social status.

As inequality in a society rises, Wilkinson argues, the social relationships of that society increasingly become characterized by relations of dominance and subordination, that is, by increasing social distance. The more this latter is the case, the more the sense of autonomy, or of self-direction, decreases for the proverbial have-nots as their dependence on the haves increases. In Wilkinson's causal mechanism, increased inequality leads to increased competition for social status, and subsequently the adoption of anti-social values and attitudes as people become more detached from and less reliant on others. These latter values progressively erode social relations and community life, and thus contributing to the social problems afflicting society. Basically, the psychological factors that create unhappiness, produce ill health and other social issues through increases in stress associated with inequality, and deprivation. For, indeed, as Wilkinson acknowledges, the connection between economic inequality and ability to access consumption goods will play a large part in explaining the connection between inequality and ill health.

On the one hand, inequality makes societies less healthy. For example, one study based on data from the U.S. General Social Survey by Kawachi and Kennedyet al, Wilkinson cites, demonstrates that states with higher inequality were less trusting than in more equal states. [17] Two studies by Robert Putnam and colleagues, one conducted in the U.S. and the other in Italy, found that the strength of community life varied with the level of inequality. The more inequality there was, the less likely people were to be involved with social, or civic organizations or activities.[18] Building off others' data for ten U.S. cities, the more inequality there was the more hostility three was.[19] Moreover, as Wilkinson notes, there are more than fifty studies showing a relationship between inequality and homicide rates.[20] Other studies have shown that higher rates of economic inequality were related with increased racial prejudice, as were lower social status for women. [21] Lastly, but by no means least, studies have shown that where inequality is greater political participation decreases, when participation is measured by propensity to vote.[22]

On the other hand, inequality also makes individuals less healthy, resulting in the early death of those on the short-side of social inequalities. All three of the main psychological risk factors for unhappiness and stress, and thus illness, that Wilkinson identified are directly related to economic inequality. Pre-natal and early childhood stress have been linked by studies to a range of later life health problems. The scientific evidence points to the stress hormones like cortisol as an important influencing factor.[23] Social isolation, that is, lack of embeddedness with a robust network of friendships, and other social connections, has been shown to be related to higher mortality rates. [24] Low social status has also been shown to be related to higher rates of mortality. What may be the most striking thing about what some of the research in this area suggests that, yes the material conditions attached to poverty matter, but that the position of inequality, of subordination and deprivation, itself produces negative consequences for health.[25]

Compounding these effects of inequality on health is the visibility of inequality, which research has found further increases inequality. [26] Subjects were experimentally manipulated into higher and lower status groups, the higher the status the more the initial endowment of the participant. The subjects participated in a game designed to test their choices given specific incentives. Basically, the experiment consists of a turn-based game where fake money is waged. The participants can choose to act cooperatively, i.e. contribute to a common pool or bank. Alternatively, players can also choose to act selfishly, and defect from cooperation, and thus gain more money for themselves than if they had cooperated. The outcome of each round depends on the choices of each of the players, and each of the player's choices effects the choices of each of the other players. The researchers found that when the levels of inequality were more visible in these experiments the outcomes of the games were more unequal distributions of wealth than in games where the levels of inequality were invisible to the players. If the visibility of wealth increases inequality in the distribution of wealth, then it stands to reason that, given the link between inequality and social health, visibility of inequality will exacerbate the negative health effects of inequality.

Inequality is Anti-Democratic

I am in deep agreement with Wilkinson when he asserts that the surprise should not be so much that inequality is as harmful to ourselves and to society as it is, but rather that we should have forgotten this. For, indeed, when we look back into the history of our modern democratic political culture, we see that the concern about economic, and thus social and political, inequality has been a major one. Both the ancient Greek and Romans had important laws, not always scrupulously abided, that limited land ownership by individuals. The idea behind these laws was to attempt to preserve a wide distribution of land-ownership, because owning land and political and social independence were linked. Indeed, in ancient minds, the former was the necessary material foundation of the latter.[27] For the Greeks , someone who depended on another for work, for a livelihood, would be thought of as an unreliable citizen. This was because the relationship between employer and employee, patron and client, is one of domination and subjugation. If one's ability access important subsistence goods hinges on the disposition of another, then one is unlikely to oppose that other politically; especially in a time when political debate and voting was done face to face, and in public. The rise of patron - client relationships was in part responsible, in the case of the Romans, for the fall of the republic.

Consider the classic slogan of the French revolution, "Liberté, Égalité, Fraternité", or liberty, equality, and solidarity. As Wilkinson rightly notes, each one of these values, is a demand, and is addressed or related to inequality. We've seen already that inequality lead to subordination, which is the anti-thesis of democratic political relations. Solidarity has to do with our understanding of social relations themselves, and their quality. A robust democratic culture must maintain a certain level and quality of social cohesion, built on relationships that affirm liberty and cooperation. We've see already that research shows that as inequality increases the quality of social relations decreases, importantly, inequality was found to decrease levels of participation. Equality can thus be seen as the basic pre-condition for liberty and solidarity. This is because of the importance of the material bases of liberty and solidarity, and the link between access to these material bases and income. Thus, the most essential foundation of any democratizing reform must be a change in the distribution of levels of access to the material pre-requisites of a decent life, the enables substantial political participation.

Inequality is also anti-democratic because it skews the outcome of public political deliberative institutions and processes, as well as "competitive" elections. A recent study by Martin Gilens and Benjamin Page demonstrated that that the majority of the U.S. electorate had little or no control over the legislative outcomes of their "democratic" institutions. That is, as their research shows, there is no statistically significant connection between the preferences of the majority of voters and the legislative outcomes of their political institutions.[28] The wealthiest elites have a statistically significant lead over the rest of the American citizenry in the likelihood of their preference being realized in public policy and law. The recent Citizens Untied ruling by the U.S. Supreme Court only further entrenched the role of money in the contemporary American political system, by legally equating money with speech. It is very likely because people perceive the way that their political elites serve economic elites and their interests much more than those of the proverbial "common man". This is also very likely behind the deep decline in voter participation in America over a period of many years. It is also almost certainly part of why other research found that a full one third of survey respondents replied "not at all" when asked, "(H)ow democratically is your country being governed?"[29]

Conclusion

Economic inequality is thus highly corrosive of democracy because it limits social mobility, creates ill health and social problems, warps the personalities of those involved in un-democratic ways, and distorts the outcomes of the political process in favor of the wealthy. Inequality lowers mobility and results in more rigid social hierarchies divided by class, that is, by income. The result of this is a society in which a great gulf opens between these classes as their social, political, and economic experiences become increasingly divorced from each other. Further, because of the link between income and consumption, there is a connection between income inequality and health; both in persons and in societies. Inequality makes people more stressed, triggering physiological reactions, that when sustained over long durations produce consequences leading to more illness and earlier death. Inequalities in societies, in particular inequalities in income, resources, and opportunities, help produce unhealthy social maladies like increased violence and crime, reduced levels of compassion, higher levels of hostility, reduced levels of trust. In essence, inequality tends to decrease social cohesion, and the robustness of participation in community life, leading to increased levels of social isolation. Inequality also leads to the creation of social and economic conditions, and structures of work, under which individuals are incentivized to become persons with anti-democratic values, attitudes, and preferences. Increases in exposure to relationships of domination and subordination lead those subordinated to taken on adaptive preferences, e.g. the specifically political withdrawal noted in the work of Kohn & Schooler et al.

What we can see now is that the responses to the problem, really problems, of inequality are woefully inadequate to address the wide range of maladies created or exacerbated by inequality. Raising taxes on the rich, and spending that money on social programs sounds like an appealing solution. But, from what we have just seen, this strategy is not capable of providing real solutions to the variegated social, economic, and political problems related to high levels of inequality in society. Tackling the problem of inequality will require much more robust measures. What should be clear from what we've discussed here is that the political and economic problems of economic and political inequality cannot be addressed singly or in isolation. Only a comprehensive strategy addressing them all simultaneously will suffice to effect real change. The economic power of capitalists gives them political power, which they use to preserve and even enhance their economic power. Unless the very social and economic foundations of this feedback loop are extirpated, the hold of bourgeois elites on both economic and political power is unlikely to be broken. This is why even a successful "political revolution" would be ineffecti ve in combatting inequality; let alone reversing the four decade old trend towards rising inequality. The only effective means of combatting inequality, and its myriad of detrimental consequences, is the seizure of political and economic power from the capitalist class by a working class that is conscious of itself as a class both in-itself and for-itself.

Notes

[1] Piketty, Thomas. Capital in the 21st Century. Tr. Arthur Goldhammer. The Belknap Press of Harvard University, 2014.

[2] In this equation r = average annual rate of growth of capital, and g = average annual rate of growth of income, or output. See Piketty, (2014), 25.

[3] See Piketty (2014); figs.8.5 - 8.10

[4] See Clark, Gregory. The Son Also Rises: Surnames and the History of Social Mobility. Princeton University Press, 2014.

[5] See Clark (2014) ch.3.

[6] See Mullainathan, Sendhil & Eldar Shafir. Scarcity: The New Science of Having Less and How It Defines Our Lives. Picador, 2014.

[7] Piff, Paul, et al. "Higher Social Status Leads to Increased Unethical Behavior". Proceedings of the National Academy of Sciences of the United States of America. Vol.109 no.11 (2012): 4086-4091.

[8] See Wilkinson (2005), 196.

[9] Kraus, Michael W., Stephane Cote, & Dacher Keltner. "Social Class, Contextualism, and Empathic Accuracy". Psychological Science. Vol.21 no.11 (2010):1716-1723.

[10] Kraus, Michael W., & Dacher Keltner. "Signs of Socioeconomic Status: A thin Slicing Approach". Psychological Science. Vol.20 no.1 (2009): 99-106.

[11] Kraus, Michael W., Paul Piff, & Dacher Keltner. "Social Class as Culture: The Convergence of Resources and Rank in the Social Realm". Current Directions in Psychological Science. Vol.20 no.4 (2011): 246-250.

[12] Stellar, Jennifer, V.M. Manzo, Michael W. Kraus, & Dacher Keltner. "Class and Compassion: Socioeconomic Factors Predict Response to Suffering". Emotion. Vol.12 no.3 (2012): 449-459.

[13] Kraus, Michael W., Paul Piff, & Dacher Keltner. "Social Class, Sense of Control, and Social Explanation". Journal of Personality and Social Psychology. Vol.97 no.6 (2009): 992-1004.

[14] Kohn, Schooler, and their colleagues take their conception of alienation from work done by Melvin Seeman in the early 1960s. See; Seeman."Alienation and Social Learning in a Reformatory". American Journal of Sociology. Vol.69 no.3 (1963): 270-284. Also see; Seeman, & John W. Evans. "Alienation and Learning in a Hospital Setting". American Sociological Review. Vol.27 no.6 (1962): 772-782.

[15] See; Kohn, Melvin. Class and Conformity: A Study in Values. 1969. University of Chicago Press, 1977. Also see; Kohn and Schooler, et al. Work and Personality. Ablex Publishing, 1983.

[16] See; Wilkinson, Richard. The Impact of Inequality: How to Make Sick Societies Healthier. The New Press, 2005.

[17] Kawachi, I., B.P.Kennedy, K.Lochner, &D.Prothrow-Smith.1997. "Social Capital, Income Inequality and Mortality. American Journal of Public Health. Vol.87 no.1: 21-32.

[18] See; Putnam, Robert. Bowling Alone: The Collapse and Revival of American Community. Simon & Schuster. 2000. Also see; Putnam, R.D., R. Leonardi, & R.Y. Nanetti. Making Democracy Work: Civic Traditions in Modern Italy. Princeton University Press, 1993.

[19] Wilkinson (2005), 51.

[20] Wilkinson (2005), 47-50.

[21] Kennedy, B.P., I. Kawachi, K. Lochner, C.P. Jones, & D. Prothrow-Smith. "(Dis)respect and Black Mortality. Ethnicity & Disease. Vol.7 (1997): 207-214. Also see; Blau, F.D. & L.M. Kahn. "The Gender Earnings Gap - Learning from International Comparisons". American Economic Review. Vol.82 (1992): 533-538.

[22] See Mahler, V.A.."Exploring the Subnational Dimension of Income Inequality". Luxembourg Income Study Working Paper 292, January, 2002. Also see; Blakely, T.A. B.P. Kennedy, & I. Kawachi. "Socioeconomic Inequality in Voting Participation and Self-rated Health". American Journal of Public Health. Vol.91 no.1(2001): 99-104.

[23] Wilkinson (2005), 81-85.

[24] Wilkinson (2005), 78-81.

[25] Wilkinson (2005), 73-76. Also see; Shively, C.A., & T.B. Clarkson. "Social Status and Coronary Artery Atherosclerosis in Female Monkeys". Arteriosclerosis & Thrombosis. Vol. 14 (1994): 721-726.

[26] Nishi, Akahiro, Hirokazu Shirado, David G. Rand, & Nicholas A. Christakis. "Inequality and Visibility of Wealth in Experimental Social Networks". Nature. Vol.526 Oct., (2015): 426-429.

[27] See; ; Havell. H.L.. Republican Rome. 1914. Oracle Publishing, 1996. Also see; Hanson. Victor Davis. The Other Greeks. University of California Press, 1999.

[28] Gilens, Martin & Benjamin I. Page. "Testing Theories of American Politics: Elites, Interest Groups, and Average Citizens". Perspectives on Politics. Vol.12 no.3 (2014).

[29] See World Values Survey Wave 6 (2010-2014).

Why There Will Be Another Trump: Focusing on the Cause, Not the Symptom

By Sean Posey

June was not kind to Donald Trump. After a brief bump in the polls when he secured the status of presumptive nominee, The Donald's numbers began their march to the basement . He now finds himself in a deeply unenviable position. An increasing number of pundits (and, judging by the numbers of them avoiding the upcoming party convention in Cleveland, politicians) are suggesting Trump's candidacy could be a disaster on par with Republican Barry Goldwater's landslide defeat in 1964 or Democrat George McGovern's in 1972.

Writing off Trump might be presumptuous at this point (since the media and other experts missed almost every salient facet of Trump's seemingly improbable rise). Yet even if his campaign encounters electoral bankruptcy in November, the specter of another Trumpian figure emerging in the future remains highly probable.

Consider the numbers : Between 1928 and 1979, the top 1 percent's economic share declined in every single state; between 1979 and 2007, the share of income going to the top earners increased in every state. In 19 states the top 1 percent of earners took in at least half of the total growth in income. The consequences of the 2007-08 financial crisis further exacerbated the situation: Between 2007 and 2010, median family income declined by almost 8 percent in real terms. Median net worth fell by almost 40 percent.

Yet with the stock market rebounding nicely (at least, until the Brexit) and unemployment seemingly on the decline, politicos saw nothing to disrupt a predictable genteel war between the Clinton and Bush dynasties; instead, the face behind The Apprentice, a businessman seemingly straight out of the Gordon Gekko era of the 1980s, emerged to trounce one of the largest fields of candidates in recent GOP history. He's now the second-most likely person to become our next president. And while (not undeservedly) a large measure of reporting fixates on Trump's wild remarks and nativist proposals, the economic dynamics that led to Trump's candidacy are underappreciated.

As Trump expertly demolished the GOP field, a coterie of the conservative establishment rushed to denigrate not just The Donald's quixotic quest, but also his base ( Kevin Williamson ofNational Review singled out ) - a large chunk of the white electorate.

"The white middle class may like the idea of Trump as a giant pulsing humanoid middle finger held up in the face of the Cathedral, they may sing hymns to Trump the destroyer and whisper darkly about 'globalists' and - odious, stupid term - 'the Establishment,' but nobody did this to them," Williamson wrote. "They failed themselves."

Did they? Or did the people for whom they voted fail them? Starting with Ronald Reagan and continuing through the administrations of Bill Clinton and Barack Obama, recent presidents of both political parties arguably have championed America's globalizing business interests over those of its workers.

While the recovery passes up wide swaths of America, the professional class of the Democratic Party looks to the stock market and to the select parts of the country where life is good and incomes are on the rise. For evidence, we need only to look to President Obama's reassuring (albeit also self-serving) remark in his final State of the Union Address: "Let me start with the economy, and a basic fact: The United States of America, right now, has the strongest, most durable economy in the world … anyone claiming that America's economy is in decline is peddling fiction."

The fact is that for Trump's voters - and perhaps voters who have yet to decide how they will cast their ballots - that worldview is not fiction at all.

While the American economy is indeed a relative bastion of stability compared with much of the world, a large portion of the population is experiencing a marked reversal of fortune. This is true both in the United States where labor, a traditional part of the Democratic base, is on the decline, and also throughout Europe, especially in places such as the Rust Belt towns of Great Britain that voted for "Brexit." As economist Branko Milanovic points out, "For simplicity, these people may be called 'the lower middle class of the rich world.' And they are certainly not the winners of globalization."

Thomas Frank's poignant analysis captures the class divide for the Democrats:"Inequality is the reason that some people find such incredible significance in the ceiling height of an entrance foyer, or the hop content of a beer, while other people will never believe in anything again."

That kind of despondency has fueled Trump's apocalyptic populism. And despite his many repugnant policy positions, he's hit the pulse of a large portion of America that is aware, quite correctly, that the middle class is fading; the real growing middle classes are in Asia today. When Trump says he'll turn the GOP into a "worker's party" and that NAFTA will be ended or renegotiated, economically left-behind workers in many states listen.

Trump's voters can be found in regions of the country almost entirely bypassed by the post-Great Recession recovery. This covers a lot of territory: Between 2010 and 2014, almost 60 percent of counties witnessed more businesses closing than opening. That contrasts sharply with the period following the recession of 1990-91, when only 17 percent of counties continued to see declines in business establishments. In the aftermath of the Great Recession, a mere 20 counties produced half of the growth in new businesses.

The real danger is that the Democrats will win a runaway victory in November and fail to heed any of the lessons behind Trump's rise. With Clinton's campaign actively wooing disaffected Republicans, chances are considerable that the populist strands of both Trump's and Bernie Sanders' campaign will receive little but lip service. "If Hillary Clinton goes for the Republican support," remarked longtime journalist Robert Scheer, "she will not be better. And then four years from now what Trump represents will be stronger." Paul Ryan's doubling down on austerity politics - the same ones thoroughly rejected by Republican voters in the primaries - will add fuel to the fire.

With the recent decision by Great Britain to leave the European Union, it seems that reactionary populism in the West has won a major victory; it should perhaps come as no surprise. A recent study by the Centre for Economic Policy Research found that far-right parties gain the most politically in the wake of major financial crises. While the research focuses on Europe, it's clear that the mix of populism and nativism brewing there is echoed by Trump here. And even if he loses in November, without a major change from both parties, someone else will tap into the vein of anger and discontentment that he's so expertly mined.

This article originally appeared at billmoyers.com

Expropriation or Bust: On the Illegitimacy of Wealth and Why It Must Be Recuperated

By Colin Jenkins

This is dedicated to Kwame Somburu, scientific socialist, William F. Buckley-slayer, thorn in the side of "mental midgets," lifelong advocate of "herstory," mentor, and friend.

"Along with the constantly diminishing number of the magnates of capital, who usurp and monopolise all advantages of this process of transformation, grows the mass of misery, oppression, slavery, degradation, exploitation; but with this too grows the revolt of the working class, a class always increasing in numbers, and disciplined, united, organised by the very mechanism of the process of capitalist production itself. The monopoly of capital becomes a fetter upon the mode of production, which has sprung up and flourished along with, and under it. Centralisation of the means of production and socialisation of labour at last reach a point where they become incompatible with their capitalist integument. This integument is burst asunder. The knell of capitalist private property sounds. The expropriators are expropriated."

- Karl Marx (Capital: Volume One)

Election seasons bring with them a renewed interest in politics. For most that couldn't care less about such concerns, election season becomes, for at least a moment, a time to reflect on deeper issues. For those of us who spend a large portion of our lives thinking, writing, acting, and engaging in these larger-than-life matters, election seasons bring other questions: can we affect change through the electoral system, how effective is voting, and how can we overcome the corporate stranglehold over politics, to name a few.

However, beneath all of the political discussions lies an uncomfortable and overwhelming truth: Nearly all of our problems are rooted in the massively unequal ownership of land, wealth, and power that exists among the over-7 billion human beings on earth. More specifically, these problems are rooted in the majority of the planet's population being stripped of its ability to satisfy the most basic of human needs. This predicament did not happen overnight, and it is far from natural. Rather, it is the product of centuries of immoral, illegitimate, and unwarranted human activity carried out by a miniscule section of the world's people.

This realization leads to an even more unsettling and uncomfortable truth: If we are to ever establish a free and just society, mass expropriation of personal wealth and property will be a necessity. In other words, the few dozens of families who have amassed personal riches equal to half the world must be forced to surrender this wealth. And furthermore, those next 5% of the global population who have acquired equally obscene amounts of wealth, relatively speaking, must also be liquidated. And, in heeding Lucy Parson's warning that "we can never be deceived that the rich will allow us to vote their wealth away," we can presume that this inevitable process of mass expropriation will not be pretty. This is a harsh and discomforting truth, indeed. But it is an undeniable truth. It is a truth that we must recognize. It is a truth that, despite being conditioned to resist, we must embrace if we are to have a shot at constructing a just world for all.

We have reached a breaking point in the human experiment. After centuries upon centuries of being subjected to extreme hierarchical systems - from monarchies to feudalism to capitalism - we are on the precipice of making a final choice: economic justice through the mass expropriation of personal wealth or infinite slavery covered by illusionary spectacles of consumer joy and bourgeois political systems. Make no mistake, expropriation is not theft. It is not the confiscation of "hard-earned" money. It is not the stealing of private property. It is, rather, the recuperation of massive amounts of land and wealth that have been built on the back of stolen natural resources, human enslavement, and coerced labor, and amassed over a number of centuries by a small minority. This wealth, that has been falsely justified by "a vast array of courts, judges, executioners, policemen, and gaolers," all of whom have been created "to uphold these privileges" and "give rise to a whole system of espionage, of false witness, of spies, of threats and corruption" [1], is illegitimate, both in moral principle and in the exploitative mechanisms in which it has used to create itself.

It is in this fundamental illegitimacy where we must take the reins and move forward in a truly liberatory and revolutionary fashion. However, before we can take collective action, we must free our mental bondage (believing wealth and private property have been earned by those who monopolize it; and, thus, should be respected, revered, and even sought after), open our minds, study and understand history, and recognize this illegitimacy together. This understanding must be reached through a careful study of the various socioeconomic systems that have ruled the human race, how the accumulation of wealth, land, and power has been extended and maintained through these systems, and how such accumulation has been illegitimate in both the ways in which it is (and has been) acquired and the ways in which it has displaced, disenfranchised, and impoverished the large majority of human beings on earth in its process. With this understanding, we can move beyond the futile process of trying to reform systems that are rotted from the core, and move forward on deconstructing these formidable social hierarchies that have been built through illegitimate, immoral, and illegal means.

"Other People's Money": On Recycled, Cold-War Propaganda

"The few own the many because they possess the means of livelihood of all ... The country is governed for the richest, for the corporations, the bankers, the land speculators, and for the exploiters of labor. The majority of mankind are working people. So long as their fair demands - the ownership and control of their livelihoods - are set at naught, we can have neither men's rights nor women's rights. The majority of mankind is ground down by industrial oppression in order that the small remnant may live in ease."

- Helen Keller

For those who remain ignorant to history - and, more specifically, to understanding how capitalism has shaped the present - ideals rooted in socialism represent a fairy-tale bogeyman. As historical understanding gives way to corporate media and standardized education schemes, fewer and fewer seem to grasp not only the basic theories of each system (capitalism and socialism) but also the ways in which they relate to us. Reactionary talking points are built on this hollow foundation. Arguments against socialist ideas and principles, whether taught in American classrooms or disseminated on cable news, remain nothing more than conditioned and packaged responses that have been recycled from Cold War propaganda. This is evident in the mythological construction of, and obsession with, equating socialism to government authority. There simply is no substance because there has been literally no scholarship on these topics in compulsory U.S. educational settings. Instead, we continue to falsely associate capitalism with freedom, private property with liberty, and socialism with theft. This is done without any learning, any thought, any investigation, or any historical analysis. It is, by nature, the epitome of propaganda, designed for one purpose and one purpose only: to justify and maintain systems of hierarchy, oppression, and mass inequality. For as long as the victims of these systems are made to believe our victimization is not only justifiable but necessary, the longer such systems can operate with little scrutiny and minimal opposition.

One of the most common parroting routines regarding the demonization of socialism is taken from neoliberal champion Margaret Thatcher, who famously remarked, "The trouble with socialism is that eventually you run out of other people's money." This one line has been used ad nauseam by proponents of capitalism. It is, after all, a perfect sound bite for those who do not want to take the time to read and learn, critically think, or chip away at their hardened cognitive dissonance. It also perfectly sums up the thoughtlessness of anti-socialist propaganda, which can be characterized by four basic presuppositions: (1) that capitalism equals freedom; or, at the very least, is the only alternative, (2) that capitalism naturally produces "winners" and "losers," (3) that capitalism is as meritocratic as possible, and thus everyone has an equal opportunity to become a "winner" or "loser," and your individual outcome is based solely on your "hard work" or lack thereof, and (4) that "winners" have earned their wealth through their own exceptionalism, and thus deserve it; while, in contrast, "losers" have earned their impoverishment through their own shortcomings, and thus deserve it.

These four ideas expose a problematic contradiction within anti-socialist propaganda: on one hand, they are ahistorical - in other words, they do not consider historical developments regarding the accumulation of wealth, property, and power, and therefore are unable to understand how these developments have shaped our modern existence. On the other hand, because they are ahistorical, they rely on a peculiar blank-slate theory - that human beings, as we exist today, have just appeared in our current state, and that this state (which is rife with inequality, impoverishment, hunger, homelessness, joblessness, etc.) is justified merely by its being, because it was not shaped by history, as history does not exist. With this blank-slate approach, investigation is not necessary. Inquiry is not necessary. Because finding the roots of these ills is a painstaking and overwhelming process that would rather be deemed unnecessary. For the world is as it is, the systems we live in are the best we can do, and emotion and instinct are all we need when reacting to the problems placed before us.

In reality, there are historical causes and effects that have created modern conditions. When we realize this, and take the time and effort to learn these layered epochs of wealth accumulation, we ultimately learn that "other people's money" is really not justifiably theirs to begin with. [2] Instead, things like personal wealth, land, and power are accumulated in only one fundamental way: through the murdering, maiming, coercing, stealing, robbing, or exploiting of others. This is not only a historically-backed truism (of which I will illustrate below), but it is also a fundamental truth rooted in human relations. There simply is no other way to amass the obscene amounts of personal wealth as have been amassed on earth.

Primitive Accumulation, Slavery, and "Old Wealth"

"In actual history, it is notorious that conquest, enslavement, robbery, murder, and force, play the great part."

- Karl Marx

Deconstructing Thatcher's statement is not especially difficult. Even on face value, most of us can recognize that wealth is hardly earned on one's perceived exceptionalism. The contrasting (and correct) retort to Thatcher's is that "the rich get richer, and the poor get poorer." This has been the case throughout history, and is a constant trend within all socioeconomic systems that have been implemented. In Monarchial Europe, wealth was determined and sustained by bloodlines and nobility. In feudal times, this transformed into divisions between lords and peasants. With capitalism, this transitioned into owners and workers. In each case, the respective governmental systems that have complemented these economic bases have always used their power to keep these divisions intact, literally for the sake of keeping wealth with wealth, and thus, power with the powerful. The founding fathers of the United States, as wealthy landowners and aristocrats, had no intentions of swaying from this model. When constructing a unique federal system in the colonies, John Jay captured the consensus thought at the Constitutional convention in Philadelphia, proclaiming that "those who own the country ought to govern it." And, in the influential Federalist Papers, James Madison echoed this sentiment, urging that a priority for any governmental system should be to "protect the minority of the opulent (the wealthy, land-owning slave-owners) against the majority (the workers, servants, and slaves)."

For instance, take the case of Donald J. Trump. Like most wealthy individuals, Trump experienced an uber-privileged upbringing, worry-free and filled with private schools and immense economic and physical security. As a young man - during a time when most people are indebting themselves for life through college, juggling multiple, minimum-wage jobs with hopes of affording basic needs, or relegated to military duty - Trump was handed his father's real-estate empire and eventually inherited between $40 and $200 million in addition. [3] Trump wealth can be traced back to a family-owned vineyard in Bavaria. [4] Trump's grandfather (Frederich Trumpf) utilized the family's wealth to move to the United States, where he opened a bar in Seattle's Red Light District and relied on prostitution as a source of revenue. This continuous line of wealth allowed Donald's father, Fred, to start a real estate business with his mother, Elizabeth Christ Trump. [5] On the verge of collapse during the Great Depression, the government (Federal Housing Administration) stepped in and saved Trump's business by funding him to build a multitude of homes in Brooklyn. Continuing his relationship with the FHA, Trump was awarded contracts to build homes for US Navy personnel throughout the east coast. [6]

Through centuries of privilege, and crucial assistance from the federal government in times of near-collapse, Trump family wealth has been allowed to flourish. Donald himself, after being handed this empire, declared bankruptcy four times, was allowed to write off over a billion dollars of debt, and was rescued by the banking industry on at least two occasions. There's nothing remotely exceptional or innovative in any of this Trump wealth. It was built on the exploitation of land, labor, and (literally) prostitution; and was boosted, and even saved, on numerous occasions by the government. While the case of Trump is admittedly anecdotal, it does represent a very common trend in regards to how personal wealth is accumulated, maintained, and extended throughout history. Contrary to those favorite anti-socialist talking points, it is almost never meritocratic. It almost always relies on external protectors and facilitators. And it always feeds on the exploitation or displacement of the majority.

But in order to truly understand how things like wealth and land, and consequently power, have been accumulated by so few, there must be basic systemic understandings of historical processes, how old epochs have transitioned into new epochs, and most importantly, how capitalism operates. In most cases, personal wealth and power is nothing more than an extension from previous generations; inheritance after inheritance stemming from primitive forms of accumulation dating back many centuries. Old wealth is intimately tied to systems that may sound like ancient history - monarchies, feudalism, indentured servitude, chattel slavery - but are, in reality, only a handful of generations removed. By merely tracing wealth back a few generations, one can see how major companies that exist today used something like the Atlantic Slave Trade to emerge as viable businesses 150 years ago. It is well-documented that companies and financial institutions like Lehman Brothers, Aetna, JP Morgan Chase, New York Life, Wachovia Corporation, Brooks Brothers, Barclays, and AIG, among many others, directly profited from the enslavement of African people in the Americas and built their financial empires from this illegitimate process. Regardless of public apologies and recognition of these past transgressions (if these things ever materialize), these powerful institutions remain intact, hoping to gain and maintain a general appearance of legitimacy as their illegal foundations become further removed from time.

Whether speaking of caste systems, nobility, aristocracy, feudalism, indentured servitude, chattel slavery, or capitalism, all modern socioeconomic systems have carried one common trait: they all amount to a minority using the majority (through exploitation or displacement) as a source of wealth, and thus have enforced and maintained this causal relationship by the threat and use of physical force and coercion in order to protect their minority interests. In the European empires, the concentration of wealth gained by this privileged minority was done so through vicious colonial expeditions where millions were murdered or enslaved and multitudes of land and natural resources were claimed by force. In North America, a wealthy minority established their own colonial experiment that was "a carbon copy of the old English aristocracies," eventually leading to the birth of the United States, "a country that was not born free, but born slave and free, servant and master, tenant and landlord, poor and rich." [7] The foundation of the US was constructed in two distinct regions, both shaped significantly by transplanted 'old wealth' and towering hierarchies: the North, where a "commercial and religious oligarchy" sought to preserve in America "the social arrangements of the mother country" by exploiting the wage-dependent and landless masses through "control of trade and commerce, establishing political domination of the inhabitants through church and town meetings, and by careful marriage alliances among themselves" [8]; and the South, where a landed aristocracy used their inherited wealth to purchase large parcels of land and thousands of slaves from the Atlantic Slave Trade. Through the early colonial years, this exclusive landed-aristocracy "held control of government, including the elected assemblies, by wielding power over tenants and slaves, by disenfranchising most citizens, and by under-representing the back-country areas." [9]

The problem of slavery in the American colonies is well documented; but what is not often understood is that chattel slavery was the foundation of the country's modern economic system. This cannot be overstated enough - the practice of chattel slavery in the South was quite literally the lifeblood of the modern United States, in terms of finance, capital, infrastructure, and even global power. Or, as Public Seminar's Julia Ott succinctly put it, "racialized chattel slaves were the capital that made capitalism." [10] According to Sven Beckert, it was the "cotton empire" that transformed the United States into a global power:

"As this cotton boom violently transformed huge swaths of the North American countryside, it catapulted the US to a pivotal role in the empire of cotton. In 1791, capital invested in cotton production in Brazil, as estimated by the US Treasury, was still more than ten times greater than in the US. In 1801, only ten years later, 60 percent more capital was invested in the cotton industry of the US than that of Brazil. Cotton, even more so than in the Caribbean and Brazil, infused land and slaves alike with unprecedented value, and promised slaveholders spectacular opportunities for profits and power. Already by 1820, cotton constituted 32 percent of all US exports, compared to a miniscule 2.2 percent in 1796. Indeed, more than half of all American exports between 1815 and 1860 consisted of cotton. Cotton so dominated the US economy that cotton production statistics 'became an increasingly vital unit in assessing the American economy.' It was on the back of cotton, and thus on the back of slaves, that the US economy ascended in the world." [11]

A 2013 paper released by economists Thomas Piketty and Gabriel Zucman illustrated not only the profound wealth generated by American slavery, but how it was significant in setting the United States apart from other industrialized nations. In contrast to its European counterparts, whose elites relied on land-wealth as their primary source of power, American elites were initially faced with a peculiar situation in regards to colonial land. Ironically, since land in the "new world" came so cheap (because it could simply be stolen from Native tribes), the true value of land became the mass agricultural production generated through slave labor. So, for American elites, wealth was not merely created by their violent land grabs, but more so by their access to free labor. Picketty and Zucman conclude,

"The lower land values prevailing in America during the 1770-1860 period were to some extent compensated by the slavery system. Land was so abundant that it was almost worthless, implying that it was difficult to be really rich by owning land. However, the landed elite could be rich and control a large share of national income by owning the labor force… In the case of antebellum U.S., the value of the slave stock was still highly significant. By putting together the best available estimates of slave prices and the number of slaves, we have come to the conclusion that the market value of slaves was between 1 and 2 years of national income for the entire U.S., and up to 3 years of income in Southern states. When we add up the value of slaves and the value of land, we obtain wealth-income ratios in the U.S. South which are relatively close to those of the Old World. Slaves approximately compensate the lower land values." [12]

The significance of slavery to the Southern economy is as obvious now as it was then. In an 1883 address to the Louisville Convention, Frederick Douglass observed this fact,

"The colored people of the South are the laboring people of the South. The labor of a country is the source of its wealth; without the colored laborer today the South would be a howling wilderness, given up to bats, owls, wolves, and bears. He was the source of its wealth before the war, and has been the source of its prosperity since the war. He almost alone is visible in her fields, with implements of toil in his hands, and laboriously using them today." [13]

But it was not just the South that thrived off the institution of slavery. It was the entire country. And it was the newly found institution of capitalism. This primitive form of accumulation amounted to an immense pool of capital which has since been utilized in layered schemes of exploitation, throughout generations, as the primary source of cyclical wealth development. Those who created it were never given access to even an ounce. Those who essentially stole it (through violent land grabs and human enslavement) have since built financial, retail, industrial, and real estate empires from it. Empires that have one common trait: they are completely illegitimate. And their connections run deep, transcending region. The tracing of this history has already been done. Take the case of 19th-century New York City banker James Brown and his family's investment bank, Browns Brothers & Co., which served as a substantial source of finance capital for over two centuries (and still exists today as Brown Brothers Harriman & Co). Upon tallying his wealth in 1842, Brown found that "his investments in the South exceeded $1.5 million, a quarter of which was directly bound up in the ownership of slave plantations." [14]

Northern bankers made fortunes from slavery. And Northern industries relied heavily on the cotton production to jump-start their own fortunes. Beckert and Seth Rockman describe these historical connections,

"Brown was hardly unusual among the capitalists of the North. Nicholas Biddle's United States Bank of Philadelphia funded banks in Mississippi to promote the expansion of plantation lands. Biddle recognized that slave-grown cotton was the only thing made in the U.S. that had the capacity to bring gold and silver into the vaults of the nation's banks. Likewise, the architects of New England's industrial revolution watched the price of cotton with rapt attention, for their textile mills would have been silent without the labor of slaves on distant plantations…

…to understand slavery's centrality to the rise of American capitalism, just consider the history of an antebellum Alabama dry-goods outfit called Lehman Brothers or a Rhode Island textile manufacturer that would become the antecedent firm of Berkshire Hathaway Inc.

Reparations lawsuits (since dismissed) generated evidence of slave insurance policies by Aetna and put Brown University and other elite educational institutions on notice that the slave-trade enterprises of their early benefactors were potential legal liabilities. Recent state and municipal disclosure ordinances have forced firms such as JPMorgan Chase & Co. and Wachovia Corp. to confront unsettling ancestors on their corporate family trees.

Such revelations are hardly surprising in light of slavery's role in spurring the nation's economic development. America's "take-off" in the 19th century wasn't in spite of slavery; it was largely thanks to it. And recent research in economic history goes further: It highlights the role that commodified human beings played in the emergence of modern capitalism itself." [15]

The United States, while advertised as the "new world" or the "free world," was nothing more than a breeding ground for age-old social hierarchies. "No new social class came to power through the door of the American Revolution. The men who engineered the revolt were largely members of the colonial ruling class." [16] There was nothing egalitarian about this experiment. "Roughly 10 percent of the American settlers, consisting of large landholders (the landed aristocracy) and merchants (the commercial aristocracy), owned nearly half the wealth of the entire country, and held as slaves one-seventh of the country's people." [17] The founding fathers and settlers sought to create a political and governmental system that avoided handing any meaningful sense of power or influence to the people, while also establishing a rule of law capable of protecting the extremely unequal distribution of land and wealth. As Cornel West explains, "American democracy emerged as a republic (representative government) rather than an Athenian-like direct democracy primarily owing to the same elite fear of the passions and ignorance of the demos (the masses). For the founding fathers - just as for Plato - too much Socratic questioning from the demos and too much power sharing of elites with the demos were expected to lead to anarchy, instability, or perpetual rebellion." [18] A general insecurity and fear of the masses, or "the mob," was a primary motivation in this birth. And this motivation was rooted solely in the material interests of a transplanted colonial ruling and owning class. Charles Beard's invaluable contribution, An Economic Interpretation of the Constitution of the United States (1935), hammered this thesis home. In reflecting on this work, Howard Zinn tell us that,

"Beard found that most of the makers of the constitution had direct economic interests in establishing a strong federal government: The manufacturers needed protective tariffs; the money lenders wanted to stop the use of paper money to pay off debts; the land speculators wanted protection as they invaded Indian lands; slave owners needed federal security against slave revolts and runaways; bondholders wanted a government able to raise money by nationwide taxation, to pay off those bonds." [19]

These motivations have dominated the political, social, and economic landscape of the United States throughout its existence. As we can see, 150 years removed from the nation's founding, not much had changed. In 1937, investigative journalist Ferdinand Lundberg obtained tax records and other historical documents in order to expose this perpetual chain of concentrated wealth. His findings, duly titled "America's 60 Families," concluded that,

"The United States is owned and dominated today by a hierarchy of its sixty richest families, buttressed by no more than ninety families of lesser wealth. These families are the living center of the modern industrial oligarchy which dominates the United States, functioning discreetly under a de jure democratic form of government behind which a de facto government, absolutist and plutocratic in its lineaments, has gradually taken form. This de facto government is actually the government of the United States - informal, invisible, shadowy. It is the government of money in a dollar democracy." [20]

And today, two-and-a-half centuries later, still nothing has changed. As of 2010, " the top 1% of US households (the upper class) owned 35.4% of all privately held wealth, and the next 19% (the managerial, professional, and small business stratum) had 53.5%, which means that just 20% of the people owned a remarkable 89%, leaving only 11% of the wealth for the bottom 80% (wage and salary workers). In terms of financial wealth (total net worth minus the value of one's home), the top 1% of households had an even greater share: 42.1%." [21]

These unequal beginnings have remained consistent through history, and have been maintained through a governmental system designed to protect them. From slavery and the industrial robber-baron era to the modern forms of monopoly and neoliberal capitalism, each epoch has continued seamlessly by constantly replacing and rebranding forms of human exploitation - peasant, servant, slave, tenant, laborer - as sources of concentrated wealth.

Human Resources: Capitalism, Enclosure, and the Exploitation of Labor

"In virtue of this monstrous system, the children of the worker, on entering life, find no fields which they may till, no machine which they may tend, no mine in which they may dig, without accepting to leave a great part of what they will produce to a master. They must sell their labour for a scant and uncertain wage."

- Peter Kropotkin (The Conquest of Bread)

One of the basic mechanisms of capitalism is the relationship between capital and labor. No matter what argument one may make in support of capitalism, this fundamental relationship can never be denied. Everything from entrepreneurships to small, family-owned businesses to corporate conglomerates must rely on this foundational interaction inherent to this economic system. Whether branded as "crony-capitalism," "corporate-capitalism," "unfettered-capitalism" or any one of the many monikers used to distract from its inherent flaws and contradictions, proponents can't deny its lifeblood - its need to exploit labor. And they can't deny the fundamental way in which it exploits labor - by utilizing property as a social relationship. It is in this relationship where masses of human beings are commodified, essentially transformed into machines, and forced to work so they may create wealth for those who employ them. This fundamental aspect of capitalism is not debatable.

The epoch of capitalism and its reliance on mass exploitation of labor was described by Marx throughout his work. A most fitting summary is found in its transition from feudalism, which is explained by Marx in Capital, Volume One,

"As soon as this process of transformation has sufficiently decomposed the old society from top to bottom, as soon as the labourers are turned into proletarians, their means of labour into capital, as soon as the capitalist mode of production stands on its own feet, then the further socialisation of labour and further transformation of the land and other means of production into socially exploited and, therefore, common means of production, as well as the further expropriation of private proprietors, takes a new form. That which is now to be expropriated is no longer the labourer working for himself, but the capitalist exploiting many labourers. This expropriation is accomplished by the action of the immanent laws of capitalistic production itself, by the centralisation of capital." [22]

In the US, the exploitation of labor - whether free (chattel slavery) or surplus (wage slavery) - has been the primary source of wealth-building for centuries. When chattel slavery was officially brought to an end after the Civil War and Emancipation Proclamation, a transition to establish and protect new forms of exploitation began. During Reconstruction in the South, the newly freed slaves were immediately betrayed by the post-war government. This betrayal came in three basic components: "(1) the freedmen did not get 'the 40 acres and a mule' they were promised; (2) the old slave owners got back their plantations and thus the power to institute a mode of production to suit cotton culture; and (3) the crop lien system was introduced with 'new' form of labor: sharecropping." [23] This transition, hence, created a new form of slavery in the South; one where,

"…the cropper (former slave) had neither control of the nature of his crop nor the marketing of it. The cropper owned nothing but his labor power, and was thus forced to part with half of the crop for 'furnishings.' The rest of the crop was to go to the merchant upon whom he depends for his every purchase of clothing, food, implements and fertilizer. The cropper was charged exorbitant prices but could not question the word of the boss who keeps the books and makes the 'settlement,' at which time the cropper found himself in perpetual debt and thus unable to leave the land." [24]

As this rebranding of human exploitation was sweeping the South, federal soldiers directed their attention north, where wage laborers were engulfed in a battle to break their own form of slavery. This concerted effort on the part of the owning class (in both north and south) to suppress their exploited laborers showed how blurred the lines between chattel slavery and wage slavery really were. In her crucial essay, American Civilization on Trial, Raya Dunayevskaya explains,

"In 1877, the year the Federal troops were removed from the South, was the year they were used to crush the railroad strikes stretching from Pennsylvania to Texas. The Pennsylvania Governor not only threatened labor with "a sharp use of bayonet and musket," but the Federal Government did exactly that at the behest of the captains of industry. The peace pact with the Southern bourbons meant unrestrained violence on the part of the rulers, both North and South, against labor." [25]

The attack on Northern laborers intensified and was supported by a continuation of white supremacist tactics that divided the white and black labor force, mostly by keeping newly freedmen indebted and stuck in their new sharecropping roles on southern plantations:

"The ruthlessness with which capital asserted its rule over labor that worked long hours for little pay, which was further cut at the will of the factory owners every time a financial crisis hit the country, drove labor underground. The first National Labor Union had a very short span of life. The Knights of Labor that replaced it organized white and black alike, with the result that, at its height (1886) out of a total membership of one million no less than 90,000 were Negroes. Nevertheless, no Northern organization could possibly get to the mass base of Negroes who remained overwhelmingly, preponderantly in the South. For, along with being freed from slavery, the Negroes were freed also from a way to make a living. Landless were the new freedmen, and penniless." [26]

The transition from feudalism to capitalism, or from peasant to wage laborer, was facilitated through similar means. As European nations - and the American colonies - had built up primitive forms of capital through stolen resources and the enslavement of Africans, industrialization was coming into its own. The feudal systems of old were no longer sufficient for the owning classes, not because they weren't advantageous, but because the peasantry, despite its subordinate and often times subhuman existence, was relatively self-sustaining. Peasants had access to land and resources - access that allowed them sustenance and the means to produce basic necessities for themselves and their families during their free time. To them, industrial wage labor was nothing more than slavery - being stripped of access to land and resources, becoming completely reliant on labor power and the meager wages it brought (of lucky) as a source of income, and being doubly reliant on those wages to not only purchase goods, but to merely sustain. In other words, to the feudal peasant living under a lordship, the prospect of becoming a wage laborer in a "more free" capitalist society was viewed as a downgrade.

This transition was a futile sell for lords-turned-capitalists; the peasantry knew better than to accept these conditions. So, the "industrious men" of the time duplicated history and proceeded in the only way they could - by stripping the peasantry of their "common" land rights and corralling them into the factories and mills. This was accomplished through the construction of bankrupt philosophies, false justifications, new laws, and armed police forces to enforce these laws. In his book, Stop Thief!: The Commons, Enclosures, and Resistance, historian Peter Linebaugh identifies the brain trust behind this transition:

"Arthur Young was the advocate of land privatization; the earth became a capitalist asset. Thomas Malthus sought to show that famine, war, and pestilence balanced a fecund population. Patrick Colquhoun was the magistrate and government intelligence agent who organized the criminalization of London custom. Jeremy Bentham contrived the architectural enclosure of the urban populations with his 'panopticon.'" [27]

Their experiment was human engineering at its finest - a literal example of a capitalist conspiracy, if there ever was one, designed for the purpose of transforming masses of people into commodities without their consent. With a contrived philosophical approach in hand, the creation of artificial laws provided the mechanism to accomplish this,

"They present their policies as 'law.' The law of property with Bentham, the law of police with Colquhoun, the laws of political economy with Young, the laws of nature in Malthus. Bentham will have institutions for orphans and 'wayward' women. Malthus will recommend the postponement of marriage. Colquhoun inveighed against brothel and ale-house. Arthur Young takes the ground from under the feet of the women whose pig-keeping, chicken minding, and vegetable patch depended on common right. They are concerned with the reproduction of the working class." [28]

The 'legal' destruction of the common land and its subsequent privatization was a fundamental prerequisite for capitalist production. It amounted to land theft on a grand scale, falsely justified by laws passed by the very men who stood to gain from it. However, this legal transformation was not complete without the forced enclosure of the peasantry. It was in this development where masses of people, formerly allowed access to common lands, were stripped of whatever meager degrees of self-determination they once had under feudalism:

"By enclosure, we include the complete separation of the worker from the means of production - this was most obvious in the case of land (the commons) - it also obtained in the many trades and crafts of London, indeed it was prerequisite to mechanization. The shoemaker kept some of the leather he worked with ("clicking"). The tailor kept cloth remnants he called 'cabbage.' The weavers kept their 'fents' and 'thrums' after the cloth was cut from the loom. Servants expected 'vails' and would strike if they were not forthcoming. Sailors treasured their 'adventures.' Wet coopers felt entitled to 'waxers.' The ship-builders and sawyers took their 'chips.' The dockers (or longshoremen) were called 'lumpers,' and worked with sailors, watermen, lightermen, coopers, warehousemen, porters, and when the containers of the cargo spilled they took as custom their 'spillings,' ' sweepings,' or 'scrapings.' The cook licked his own fingers." [29]

The invention of capitalism and wage labor changed all of this. And, in this day and time, wage labor was widely recognized by former slaves and peasants as being not very different from that of chattel slavery. "Experience demonstrates that there may be a slavery of wages only a little less galling and crushing in its effects than chattel slavery," warned former slave, Frederick Douglass, "and this slavery of wages must go down with the other." [30] To ruling and owning elites, the invention of wage labor was intimately tied to that of chattel slavery, systemically. "While most theories of capitalism set slavery apart, as something utterly distinct, because under slavery, workers do not labor for a wage," Ott tells us, "new historical research reveals that for centuries, a single economic system encompassed both the plantation and the factory." [31]

Even in the field of "business organization" and "management," the southern slave plantation was viewed as an influential and beneficial model to be transplanted and deployed in northern factories and mills:

"The plantation didn't just produce the commodities that fueled the broader economy; it also generated innovative business practices that would come to typify modern management. As some of the most heavily capitalized enterprises in antebellum America, plantations offered early examples of time-motion studies and regimentation through clocks and bells. Seeking ever-greater efficiencies in cotton picking, slaveholders reorganized their fields, regimented the workday, and implemented a system of vertical reporting that made overseers into managers answerable to those above for the labor of those below." [32]

And because of this inherently exploitative and dehumanizing labor process found under capitalism, the state has been needed to act on behalf of those who accumulate the illegitimate wealth from this process. Without the state, this unequal social arrangement - where the majority is essentially born into bondage - would not survive. An especially useful anarchist analysis regarding the relationship between wage slavery and state force tells us,

"In every system of class exploitation, a ruling class controls access to the means of production in order to extract tribute from labor. Capitalism is no exception. In this system the state maintains various kinds of 'class monopolies' (to use Benjamin Tucker's phrase) to ensure that workers do not receive their 'natural wage,' the full product of their labor. While some of these monopolies are obvious (such as tariffs, state granted market monopolies and so on), most are 'behind the scenes' and work to ensure that capitalist domination does not need extensive force to maintain." [33]

Hence, the illegitimacy of primitive accumulation provided the foundation for the illegitimacy of the wage-labor system central to capitalism, whose exploitative arrangement is protected by the illegitimacy of the capitalist state.

"Property is Theft": On Private Property and Landlordism

"If I were asked to answer the following question: What is slavery? and I should answer in one word, It is murder!, my meaning would be understood at once. No extended argument would be required to show that the power to remove a man's mind, will, and personality, is the power of life and death, and that it makes a man a slave. It is murder. Why, then, to this other question: What is property? may I not likewise answer, It is robbery!, without the certainty of being misunderstood; the second proposition being no other than a transformation of the first?"

- Pierre-Joseph Proudhon (What is Property?)

The prevailing mindset within capitalist society has been to place property above all else. Those of us who have grown up in the US have had this idea drilled into our heads at every turn. The materialistic nature of consumerism, which equates self-worth with the accumulation of wealth, land, and other material goods, has conditioned us to view our lives and the lives as others as being secondary, or at best equal, to the value of property. Our property becomes our identity, and for this reason, it becomes as sacred and revered as human life itself.

When American "pioneers," accompanied by federal soldiers, stole Native American land, forced Native American people out of those lands, corralled them into open-air prisons, and used that newly-claimed land to enrich themselves, this established a path of illegitimacy. It doesn't matter that - after multiple generations have partaken in the buying and selling of this same land - those who profit from said land today did not take part in the actual killing, maiming, and robbing of Native American peoples. Time and separation are irrelevant factors. Being distanced from the illegitimate roots of multi-generational theft for the sake of profit-making doesn't make one innocent in the process. The entire cycle has been built on a foundation of illegitimacy. This stolen land was never intended to be a source of wealth for European colonizers and their future bloodlines, or for anyone else for that matter. In using this modern scenario, this process of wealth accumulation can be applied to all such accumulation since the beginning of time.

That being said, condemning and exposing the forcible extraction of land, in itself, does not begin to address the philosophical illegitimacy of private property. In order to correctly point out this illegitimacy, we must dig deeper. We must understand the meaning of private property, how it came about, and what its sole purpose is. To being this inquiry, let's consider what Emma Goldman had to say about private property in her 1908 pamphlet, "What I Believe":

"'Property' means dominion over things and the denial to others of the use of those things. So long as production was not equal to the normal demand, institutional property may have had some raison d'être. One has only to consult economics, however, to know that the productivity of labor within the last few decades has increased so tremendously as to exceed normal demand a hundred-fold, and to make property not only a hindrance to human well-being, but an obstacle, a deadly barrier, to all progress. It is the private dominion over things that condemns millions of people to be mere nonentities, living corpses without originality or power of initiative, human machines of flesh and blood, who pile up mountains of wealth for others and pay for it with a gray, dull and wretched existence for themselves. I believe that there can be no real wealth, social wealth, so long as it rests on human lives - young lives, old lives and lives in the making." [34]

When one person, any person, acts on their individual power to acquire property that is to be used beyond their own means, they are doing so for the purpose of direct exploitation or residual dispossession. If it is not to be used as a means to live and sustain, it can either be (1) abandoned and restricted from those who have none, (2) used to extract natural resources for individual use beyond necessity, or (3) utilized as a social relationship to employ other human beings as a source of wealth-building (through the exploitation of labor). When one exercises this undue power (whether through force or unseen privilege), "It is conceded that the fundamental cause of this terrible state of affairs is: that man must sell his labor; and that his inclination and judgment are subordinated to the will of a master (the one who owns the land)." [35]

When considering this analysis, one that surely sounds alien to most living in the 21st century, it is important to understand basic notions of property, and most importantly, the difference between "personal property" and "private property."

The use of private property as a way to exploit others is unique to capitalism. For example, in contrast to feudalism, capitalists only allow workers access to their property during times when said workers are laboring to create wealth for said owners. In feudal times, as mentioned before, peasants were allowed to live on this land, and even use it as a means to sustain for themselves and their families, as long as this personal activity was done after the lord's work had been completed. Now, with capitalism, workers "punch in," proceed to labor for a specified amount of time in exchange for a fraction of the wealth they create, "punch out," and then are left to find their own means of housing, food, clothing, and basic sustenance with only the wage they receive. This latter task has proven to be difficult for a majority of the world's population for the past number of centuries, even in so-called industrialized nations, which is why welfare states have become prominent as a means to facilitate the mass exploitation of the working class. Capitalists, and their governments, learned long ago that workers must be able to survive, if only barely, so that they may continue to labor and consume.

In 1918, on the heels of Russian Revolution and subsequent birth of the Soviet Union, German socialist Rosa Luxemburg illustrated the glaring contrast between a society that allows for the concentration of property as a means to exploit a displaced and landless majority (capitalism) versus one that utilizes property as a communal, life-sustaining resource (socialism) for all of its members. In analyzing capitalist property relations and its consequences on society, she tells us,

"To-day all wealth, the largest and most fruitful tracts of land, the mines, the mills and the factories belong to a small group of Junkers and private capitalists. From them the great masses of the laboring class receive a scanty wage in return for long hours of arduous toil, hardly enough for a decent livelihood. The enrichment of a small class of idlers is the purpose and end of present-day society…

… To-day production in every manufacturing unit is conducted by the individual capitalist independently of all others. What and where commodities are to be produced, where, when and how the finished product is to be sold, is decided by the individual capitalist owner. Nowhere does labor have the slightest influence upon these questions. It is simply the living machine that has its work to do." [36]

In contrasting this with a socialist solution, she illustrates the alternative:

"To give to modern society and to modern production a new impulse and a new purpose - that is the foremost duty of the revolutionary working class…. To this end all social wealth the land and all that it produces, the factories and the mills must be taken from their exploiting owners to become the common property of the entire people. It thus becomes the foremost duty of a revolutionary government of the working class to issue a series of decrees making all important instruments of production national property and placing them under social control.

…Private ownership of the means of production and subsistence must disappear. Production will be carried on not for the enrichment of the individual but solely for the creation of a supply of commodities sufficient to supply the wants and needs of the working class. Accordingly factories, mills and farms must be operated upon an entirely new basis, from a wholly different point of view.

…production is to be carried on for the sole purpose of securing to all a more humane existence, of providing for all plentiful food, clothing and other cultural means of subsistence." [37]

While the ways in which such economic justice can and should be obtained, and how new systems should be arranged as an alternative, are debatable topics, Luxemburg's description of and contrast to capitalist property relations still remain the same. And it serves as an instructive analysis to why such property relations are fundamentally illegitimate. In Marx's explanation of potential transitions from the capitalist mode of property to the socialist, we see the same contrast. In Capital, he tells us,

"The capitalist mode of appropriation, the result of the capitalist mode of production, produces capitalist private property. This is the first negation of individual private property, as founded on the labour of the proprietor. But capitalist production begets, with the inexorability of a law of Nature, its own negation. It is the negation of negation. This does not re-establish private property for the producer, but gives him individual property based on the acquisition of the capitalist era: i.e., on cooperation and the possession in common of the land and of the means of production.

The transformation of scattered private property, arising from individual labour, into capitalist private property is, naturally, a process, incomparably more protracted, violent, and difficult, than the transformation of capitalistic private property, already practically resting on socialised production, into socialised property. In the former case, we had the expropriation of the mass of the people by a few usurpers; in the latter, we have the expropriation of a few usurpers by the mass of the people." [38]

To complement the materialist analysis presented by an array of Marxist thinkers, anarchists have added equally-useful, philosophically-based arguments against the ownership of private property. Simply stated, to anarchists, private property must be opposed because it is "a source of coercive, hierarchical authority as well as exploitation and, consequently, elite privilege and inequality. It is based on and produces inequality, in terms of both wealth and power." [39] The unnatural and unequal distribution of power among human populations due to private property is a common-sense analysis that can be understood by simply imagining the start of any such society, where all would have equal footing, equal rights, equitable futures, and the basic will to satisfy needs (without taking that will away from others). However, if and when a member of that community decides to take more than they need, they immediately create a scenario where others will inevitably go without, be subjected to an exploitative social relationship, and/or rely on the illegitimate landowner for basic needs (in the form of some sort of exchange). As anarchist philosophy tells us, "those who own property exploit those who do not. This is because those who do not own have to pay or sell their labor to those who do own in order to get access to the resources they need to live and work (such as workplaces, machinery, land, credit, housing, and products under patents). [40]

Proudhon's assertion that "property is theft" was not hyperbolic. He elaborates,

"The proprietor, the robber, the hero, the sovereign -- for all these titles are synonymous -- imposes his will as law, and suffers neither contradiction nor control; that is, he pretends to be the legislative and the executive power at once . . . [and so] property engenders despotism . . . That is so clearly the essence of property that, to be convinced of it, one need but remember what it is, and observe what happens around him. Property is the right to use and abuse . . . if goods are property, why should not the proprietors be kings, and despotic kings -- kings in proportion to their facultes bonitaires? And if each proprietor is sovereign lord within the sphere of his property, absolute king throughout his own domain, how could a government of proprietors be anything but chaos and confusion?" [41]

Even bourgeois philosophers like Jean-Jacque Rousseau, someone whose ideas would now be relegated to the radical fringe, warned against the notion of private property, albeit from a moral viewpoint. In his 1755 "Discourse on the Origin and Basis of Inequality Among Men," he touched on its consequences for humanity, writing,

"The first man who, having fenced off a plot of land, thought of saying, 'This is mine' and found people simple enough to believe him was the real founder of civil society. How many crimes, wars, murders, how many miseries and horrors might the human race had been spared by the one who, upon pulling up the stakes or filling in the ditch, had shouted to his fellow men: 'Beware of listening to this impostor; you are lost if you forget the fruits of the earth belong to all and that the earth belongs to no one.'" [42]

Ironically, the notion of private property is lauded by right-wing theories of "libertarianism" as the basis of liberty and freedom. In reality, private property accomplishes the opposite, and makes any semblance of human liberty obsolete and impossible. Legalistically, under capitalism and the state's enforcement of property law, the illegitimate ownership of land creates a scenario where land is monopolized by an extremely small and privileged group of people for the sole purpose of extracting wealth (essentially through force and coercion) from both natural and human resources. The anarchist analysis tells us,

"The land monopoly consists of enforcement by government of land titles which do not rest upon personal occupancy and use. It also includes making the squatting of abandoned housing and other forms of property illegal. This leads to ground-rent, by which landlords get payment for letting others use the land they own but do not actually cultivate or use. It also allows the ownership and control of natural resources like oil, gas, coal and timber. This monopoly is particularly exploitative as the owner cannot claim to have created the land or its resources. It was available to all until the landlord claimed it by fencing it off and barring others from using it." [43]

The natural consequence of this process is landlordism, "an economic system under which a few private individuals (landlords) own property, and rent it to tenants." This system, despite being a major affront to liberty, has become the norm. And, like the system of wage labor, it coerces the majority into an extremely subservient and dependent role by forcing them to rely on, and submit themselves to, a privileged minority which has gained control of the land. Returning to our anarchist analysis, we can see that,

"At a minimum, every home and workplace needs land on which to be built. Thus while cultivation of land has become less important, the use of land remains crucial. The land monopoly, therefore, ensures that working people find no land to cultivate, no space to set up shop and no place to sleep without first having to pay a landlord a sum for the privilege of setting foot on the land they own but neither created nor use. At best, the worker has mortgaged their life for decades to get their wee bit of soil or, at worse, paid their rent and remained as property-less as before. Either way, the landlords are richer for the exchange." [44]

The illegitimacy of this form of land ownership is found not only in its reliance on mass exploitation and dispossession, but also in the means in which it has been allowed to develop. This process of landlordism has complemented the development of the capitalist system, mimicking the social relationship between labor and capital, and consequently doubling down on exploitation through the creation of yet another relationship between tenant and landlord. Along with primitive forms of accumulation, like chattel slavery, which allowed for the influx of the raw capital needed to launch the capitalist system, the forceful acquisition and expansion of privately-owned land has been facilitated by the state. This facilitation has been delivered through both military force and legislative (legal) support:

"… The land monopoly did play an important role in creating capitalism. This took two main forms. Firstly, the state enforced the ownership of large estates in the hands of a single family. Taking the best land by force, these landlords turned vast tracks of land into parks and hunting grounds so forcing the peasants little option but to huddle together on what remained. Access to superior land was therefore only possible by paying a rent for the privilege, if at all. Thus an elite claimed ownership of vacant lands, and by controlling access to it (without themselves ever directly occupying or working it) they controlled the laboring classes of the time. Secondly, the ruling elite also simply stole land which had traditionally been owned by the community. This was called enclosure, the process by which common land was turned into private property." [45]

Much like the advent of wage labor, the notion of private property has undergone a complete transformation in the psychological imagination over the past few centuries. Both serve one purpose - to act as social relationships which allow for the accumulation and concentration of wealth via the exploitation of the majority. This understanding was once common sense, even among bourgeois philosophies that dominated the Enlightenment. Now, after generations of conditioning, this basic realization is alien to most. Not only are notions of wage labor and private property viewed as the natural order of things, but private property itself has become infused with the much different idea of personal property. This has led to the development of an exploited working-class majority which reveres such property, respects its existence without question, and even fights to protect it at all costs despite its sole purpose to exploit said majority. Thus, in the psychological imagination, the illegitimate has become legitimate. While, in reality, it remains as illegitimate as ever.

Natural Resources: On Colonialism and Global Looting

"The essence of capitalism is to turn nature into commodities and commodities into capital. The live green earth is transformed into dead gold bricks, with luxury items for the few and toxic slag heaps for the many. The glittering mansion overlooks a vast sprawl of shanty towns, wherein a desperate, demoralized humanity is kept in line with drugs, television, and armed force."

- Michael Parenti

In order for capitalists to utilize private property as a social relationship in their mass exploitation of the working class, they must have access to the natural resources - timber, gold, minerals, diamonds, shale, oil, etc… - that are necessary to fuel production and create commodities and goods to be bought and sold in a market. Since nations are, in theory, constricted to geographic boundaries, they often do not have access to all of the natural resources they need or desire. Throughout history, the remedy for this was the notion of trading - whereas one nation would trade their surplus resources to another nation in return for needed resources, and vice versa. However, as industrial capitalism began to grow exponentially, so did the need to transform agrarian land to industrial zones, as well as farmers to industrial laborers. As Karl Kautsky explained in his 1914 essay on "ultra-imperialism," the arrival of colonialism and, more specifically, imperialism, was an inevitable stage of global capitalist production. As capitalist governments, in representing their profit sectors, were forced to seek out new industrial zones, "the sweet dream of international harmony (free trade) quickly came to an end." Because, "as a rule, industrial zones overmaster and dominate agrarian zones." [46]

Modern European imperialism can be traced as far back as the 15th century, at the height of its trade with Asian territories. During this time, because of a lack of marketable goods, European nations turned to naval dominance as a means to an end. The Portuguese provided an example of this militaristic transition:

"…since Roman times, Europe had been exporting gold and silver to the East: the problem was that Europe had never produced much of anything that Asians wanted to buy, so it was forced to pay in specie for silks, spices, steel, and other imports. The early years of European expansion were largely attempts to gain access either to Eastern luxuries or to new sources of gold and silver with which to pay for them. In those early days, Atlantic Europe really had only one substantial advantage over its Muslim rivals: an active and advanced tradition of naval warfare, honed by centuries of conflict in the Mediterranean. The moment when Vasco da Gama entered the Indian Ocean in 1498, the principle that the seas should be a zone of peaceful trade came to an immediate end. Portuguese flotillas began bombarding and sacking every port city they came across, then seizing control of strategic points and extorting protection money from unarmed Indian Ocean merchants for the right to carry on their business unmolested." [47]

Around the same time, in perhaps the most influential development in the shaping of the modern world, European powers discovered the western hemisphere. The mass looting of the Americas, as they would come to be called, more than satisfied the Asian demand for precious metals via trade:

"At almost exactly the same time (as the Portuguese assault), Christopher Columbus - a Genoese mapmaker seeking a short-cut to China-touched land in the New World, and the Spanish and Portuguese empires stumbled into the greatest economic windfall in human history: entire continents full of unfathomable wealth, whose inhabitants, armed only with Stone Age weapons, began conveniently dying almost as soon as they arrived. The conquest of Mexico and Peru led to the discovery of enormous new sources of precious metal, and these were exploited ruthlessly and systematically, even to the point of largely exterminating the surrounding populations to extract as much precious metal as quickly as possible." [48]

For European powers during the 19th century, militarism also became the primary means of resource extraction from the continent of Africa. While Africa had faced problems with colonial settlers as far back as 550 BC (Greeks), the late-19th century pillaging of the continent was especially important to the modern system of global capitalism. As consistent with capital accumulation, Africa's natural resources proved to be a major source of wealth production for a tiny sector of Europe's capitalist class, while simultaneously leaving African peoples in dire circumstances. Britain's role in this process is especially notable. Claude Kabemba, of the Open Society Initiative for Southern Africa, tells us,

"British capital played a key role in extraction of resources during the colonial period, especially in southern and central Africa. The competition to find and control sources of raw materials, including minerals, was one of the main drivers of European penetration and eventual colonial partition of Africa in the last quarter of the 19th century. Africa's vast resources were plundered to support the development of Britain - and other European powers - while contributing minimally to the development of the continent. Indeed, Africans have little to show for centuries of exploitation of their mineral resources. Poverty on the continent is as bad as ever. Inequality is also just as severe, if not worse, and there are increasing conflicts between extractive companies and communities." [49]

Colonialism is inseparable from Capitalism. As the capitalist system became globalized over the course of a few centuries, in its constant search for new markets, the need to dominate unoccupied lands and "uncooperative" peoples became a necessity. Thus, "new markets" were established through occupation directed by capitalist militaries, the forcible removal of millions of human beings from their native lands, and the forcible extraction of natural resources. US Marine Corps Major General Smedley Butler's account of his experiences in South and Central America at the turn of the 20th century gives invaluable insight on this process. Said Butler,

"I spent 33 years and four months in active military service and during that period I spent most of my time as a high class muscle man for Big Business, for Wall Street and the bankers. In short, I was a racketeer, a gangster for capitalism. I helped make Mexico and especially Tampico safe for American oil interests in 1914. I helped make Haiti and Cuba a decent place for the National City Bank boys to collect revenues in. I helped in the raping of half a dozen Central American republics for the benefit of Wall Street. I helped purify Nicaragua for the International Banking House of Brown Brothers in 1902-1912. I brought light to the Dominican Republic for the American sugar interests in 1916. I helped make Honduras right for the American fruit companies in 1903. In China in 1927 I helped see to it that Standard Oil went on its way unmolested. Looking back on it, I might have given Al Capone a few hints. The best he could do was to operate his racket in three districts. I operated on three continents." [50]

Butler's honesty, while representing a rare act of integrity for a high-ranking US military officer, did little to help the millions of people who had been ransacked, looted, and displaced by the US military and subsequent corporate takeovers of land. Such occupations would reverberate for decades, if not centuries. For example, in Haiti, although the official military occupation ended in 1934, "the corporations that were given lands failed miserably, with the lone exception of the Haitian-American Sugar Company, which endured for over five decades until it closed its doors in 1989." With unfathomable amounts of resources and wealth being stolen and regenerated by the US capitalist class, "the people of Haiti were left landless and jobless," making mass migration through the western hemisphere a necessity. And these complicit actors (like Butler) who had long passed, and these dead entities, "live on as one collective in this ghost that continues to mold Haiti's policy" and modern reality. [51]

In expanding on, or correcting (in his view), Kautsky's analysis, Vladimir Lenin illustrated how it was not only the parasitic nature of industrial capitalism that led to imperialism, but more so the constant need of finance capital to regenerate itself through exposure to new markets. In this sense, explains Lenin, the illegitimacy of capitalist accumulation on a national level became at odds with itself, with various "core" nations attempting to outdo one another in their pillaging of "periphery" nations. Lenin tells us,

"Imperialism is a striving for annexations-this is what the political part of Kautsky's definition amounts to. It is correct, but very incomplete, for politically, imperialism is, in general, a striving towards violence and reaction. For the moment, however, we are interested in the economic aspect of the question, which Kautsky himself introduced into his definition. The inaccuracies in Kautsky's definition are glaring. The characteristic feature of imperialism is not industrial but finance capital. It is not an accident that in France it was precisely the extraordinarily rapid development of finance capital, and the weakening of industrial capital, that from the eighties onwards gave rise to the extreme intensification of annexationist (colonial) policy. The characteristic feature of imperialism is precisely that it strives to annex not only agrarian territories, but even most highly industrialised regions (German appetite for Belgium; French appetite for Lorraine), because (1) the fact that the world is already partitioned obliges those contemplating a redivision to reach out for every kind of territory, and (2) an essential feature of imperialism is the rivalry between several great powers in the striving for hegemony, i.e., for the conquest of territory, not so much directly for themselves as to weaken the adversary and undermine his hegemony. (Belgium is particularly important for Germany as a base for operations against Britain; Britain needs Baghdad as a base for operations against Germany, etc.)" [52]

The profit-making potential of war has become even more obvious in recent decades, exposing the intimate ties between capitalism, imperialism, finance, and the military industrial complex. False and contrived "calls to action," like the United States' so-called "War on Terror," provide the perfect justification for the endless production, use, and reproduction of immensely destructive weapons and munitions. A simple search on stock trends for the top weapons' manufacturers illustrates this. Lockheed Martin stock, which was worth $38.49 per share on 9/7/01 (4 days prior to the 9/11 attack), is now worth $238.01 (6/17/16). Raytheon went from $24.85 per share to $134.49. Northrup Grumman has increased from $40.95 per share pre-9/11 to $213.87. Halliburton ($16.08 per share in 2001 to $73.41 in 2014), Boeing ($68.35 to $129.60), General Dynamics (from $41.50 $138.94), Honeywell (from $35.75 to $115.93), and BAE Systems ($330.00 to $477.30) have all experienced similar profit gains during this period of massive bombing campaigns across the world. A 2016 report by the Netherlands-based peace organization, PAX, also found that 150 financial institutions, including JP Morgan Chase and Bank of America, have invested roughly $28 billion dollars in companies manufacturing internationally-banned cluster bombs. And, when considering that major US politicians, including John Kerry and Hillary Clinton, have owned stock in these companies, this quite literally represents a form of human sacrifice for monetary gain. Every dead body in Iraq, Afghanistan, Gaza, Pakistan, etc… equals more money in their personal bank accounts.

Immanuel Wallerstein's World-Systems Theory (WST) is especially helpful in terms of macro-analyzing global relations based in the expansion of the capitalist system over the past few centuries. This approach "traces the rise of the capitalist world-economy from the 'long' 16th century (c. 1450-1640), which, according to Wallertsein, "was an accidental outcome of the protracted crisis of feudalism (c. 1290-1450)." In formulating this capitalist world order, "Europe (the West) used its advantages and gained control over most of the world economy and presided over the development and spread of industrialization andcapitalist economy, indirectly resulting in unequal development." [53]

Because of its Eurocentric organization, the global capitalist onslaught that has dominated the modern world has blatantly racial underpinnings. The "core nations" that make up WST's dominant group (US, England, France, Germany) tends to be "lighter" on the color scale, while the "periphery nations" that make up its dominated group (nations primarily in the global south) tend to be "darker." If anything, this oppression based in colorism makes it easier for core-nation ruling classes to justify their actions to their own subjects (the core-nation working classes). Despite a white supremacist agenda (see "Manifest Destiny," the "White Man's Burden," and the Roosevelt Corollary of the Monroe Doctrine) that has undoubtedly influenced this global looting on a mass scale, the primary development of modern capitalist imperialism remains economic. As world-systems theorist Samir Amin tells us, for the peoples who live within periphery nations, "colonization was (and is) atrocious. Like slavery, it was (and is) an attack on fundamental rights." However, its perpetuation is motivated by material gain. "If you want to understand why these rights were trampled on and why they still are being trodden on in the world today," explains Amin, "you have to get rid of the idea that colonialism was the result of some sort of conspiracy. What was at stake was the economic and social logic that must be called by its real name: capitalism." [54]

In echoing earlier assessments of colonialism and imperialism (from the likes of Kautsky and Lenin) as inherent capitalist mechanisms, Amin insists that,

"They are inseparable. Capitalism has been colonial, more precisely imperialist, during all the most notable periods of its development. The conquest of the Americas by the Spaniards and Portuguese in the 16th century, then by the French and the British, was the first modern form of imperialism and colonization: an extremely brutal form which resulted in the genocide of the Indians of North America, Indian societies in Latin America thrown into slavery and black slavery through the whole continent, north and south. Beyond this example, by following a logic of precise deployment through the different stages of its history, we can see that capitalism has constructed a consistent dichotomy of relations between a centre (the heart of the system of capitalist exploitation) and the periphery (made up of dominated countries and peoples)." [55]

In describing the real-life effects on populations of people, Amin tells us that this global order,

"…has been based on unequal exchange, that is, the exchange of manufactured products, sold very expensively in the colonies by commercial monopolies supported by the State, for the purchase of products or primary products at very low prices, since they were based on labour that was almost without cost - provided by the peasants and workers located at the periphery. During all the stages of capitalism, the plunder of the resources of the peripheries, the oppression of colonized peoples, their direct or indirect exploitation by capital, remain the common characteristics of the phenomenon of colonialism."[56]

In other words, "the plunder and hyper-exploitation of the global South," a region spanning dozens of countries and billions of people, has directly led to the enrichment of the west (European powers). And this enrichment, which expands well into the tens of trillions of dollars, has been claimed by a very small sector of the western capitalist and ruling classes. Much like how labor and private property are used as the primary means for the few to extract wealth from the many, colonialism and imperialism have represented more blatant and violent forms of robbing global wealth. Through the forced occupation of "unused" land (property not being utilized as a means to exploit), displacement of millions of communities, killing of masses of indigenous peoples, and utter destruction of more than half of the earth's infrastructure, "62 individuals have been allowed to amass the same amount of wealth as 3.6 billion people combined." [57]

Beyond the mass displacement and impoverished of billions of people, this process has also equaled a social cost that simply cannot be explained in numbers. It is the cost associated with the ravaging and utilization of earth's finite resources. In a modern inquiry into the concept and history of land ownership, Jeriah Bowser sums up the environmental consequences of the European colonization of North America:

"The cost of the North American land enclosure has been heavy. In less than 500 years, over four million square miles of land have been colonized, privatized, and commodified. Over 95% of the standing forests in the US are gone, the soils of the once-fertile breadbasket of the Midwest are extremely depleted, over 37% of the rivers in the US are declared 'unusable' due to pollution and contamination, over 1,000 species of plants and animals have become extinct, and the largest genocide in history took the lives of over 50 million indigenous people. The rich and promising 'land of opportunity' was apparently only an opportunity for a few, at the expense of many." [58]

These numbers apply to North America alone, which amounts to 9.5 million square miles. Multiply this by 54 to get a sense of the global consequences (over 510 million square miles).

The Trickery Behind "New Wealth"

"I am opposing a social order in which it is possible for one man who does absolutely nothing that is useful to amass a fortune of hundreds of millions of dollars, while millions of men and women who work all the days of their lives secure barely enough for a wretched existence."

- Eugene V. Debs

Most "new wealth" has been accumulated through financialization, a massive scheme of manipulating, speculating, and gambling on money and commodities. The modern form of speculation that has dominated financial markets is a brand of trickery on a scale like none before. While it represents a complete separation from traditional capitalist production schemes, it remains tied to capitalist wealth production in that it owns and controls the bloodline of this system: currency. And it uses this concentration of money to manage all aspects of the economic system that control us. In a damning summary of modern financialization, Chris Hedges explains,

"Once speculators are able to concentrate wealth into their hands they have, throughout history, emasculated government, turned the press into lap dogs and courtiers, corrupted the courts and hollowed out public institutions, including universities, to justify their looting and greed. Today's speculators have created grotesque financial mechanisms, from usurious interest rates on loans to legalized accounting fraud, to plunge the masses into crippling forms of debt peonage...

...They steal staggering sums of public funds, such as the $85 billion of mortgage-backed securities and bonds, many of them toxic, that they unload each month on the Federal Reserve in return for cash. And when the public attempts to finance public-works projects they extract billions of dollars through wildly inflated interest rates.

Speculators at megabanks or investment firms such as Goldman Sachs are not, in a strict sense, capitalists. They do not make money from the means of production. Rather, they ignore or rewrite the law -ostensibly put in place to protect the vulnerable from the powerful-to steal from everyone, including their shareholders. They are parasites. They feed off the carcass of industrial capitalism. They produce nothing. They make nothing. They just manipulate money. Speculation in the 17th century was a crime. Speculators were hanged." [59]

The 2008 global financial crisis was caused by these very practices which became commonplace on Wall Street - practices that were purposely deceitful, vague, and built for a short-term and surefire way to funnel massive amounts of wealth into the hands of very few. As has become clear in the aftermath, those who were in on this "scam of epic proportions" understood exactly what they were doing. Essentially, the massive amount of private wealth that was created during this first decade of the 21st century was completely reliant on one, gigantic, legalized Ponzi scheme. And this scheme had millions of victims - people who lost pensions, lost homes, were driven out of the workforce, driven off public protections through austerity, starved, and impoverished on mass scale. As David Graeber explains,

"…when the rubble had stopped bouncing, it turned out that many if not most of them had been nothing more than very elaborate scams. They consisted of operations like selling poor families mortgages crafted in such a way as to make eventual default inevitable; taking bets on how long it would take the holders to default; packaging mortgage and bet together and selling them to institutional investors (representing, perhaps, the mortgage-holders' retirement accounts) claiming that it would make money no matter what happened, and allow said investors to pass such packages around as if they were money; turning over responsibility for paying off the bet to a giant insurance conglomerate that, were it to sink beneath the weight of its resultant debt (which certainly would happen), would then have to be bailed out by taxpayers (as such conglomerates were indeed bailed out). In other words, it looks very much like an unusually elaborate version of what banks were doing when they lent money to dictators in Bolivia and Gabon in the late '70s: make utterly irresponsible loans with the full knowledge that, once it became known they had done so, politicians and bureaucrats would scramble to ensure that they'd still be reimbursed anyway, no matter how many human lives had to be devastated and destroyed in order to do it." [60]

The mortgage-backed securities scheme was not an outlier on Wall Street; it was its backbone for nearly a decade. It was as elaborate as it was enormous. And, as I wrote in a 2013 piece for the Hampton Institute, it was made possible through decades of deregulation during the first half of the neoliberal era:

"… [This trend] began during the 1980s and beyond, when widespread deregulation of the financial sector led to a new trend regarding home loans. Notable legislation was the 1982 Alternative Mortgage Transactions Parity Act (AMTPA), the repeal of the Glass-Steagall Act in 1999, and the Commodity Futures Modernization Act of 2000, which essentially opened the door to free-game derivatives and the questionable use of credit default swaps. Ultimately, deregulation led to a virtual disappearance of accountability, and this disappearing act was made possible by a newly developed loan process that was characterized by a seemingly perpetual delegation of responsibility. Rather than hold a loan through its lifespan (common practice until this point), commercial banks began selling mortgages to investment banks, which in turn began pooling together hundreds and thousands of mortgages as mortgaged-backed securities. The investment banks then sold these mortgage-backed securities to hedge funds, pension funds, foreign investors, etc.., essentially 'passing the buck' of what were known by many to be toxic. Therefore, the 'originators' of mortgages (commercial banks and mortgage companies) no longer had a financial incentive to make sure the homebuyers were 'credit-worthy.' Instead, they issued the mortgages and sold them off through securitization." [61]

The scheme also involved bond rating agencies like Moody's and Standard and Poor's, which were complicit in awarding AAA ratings to these toxic securities in order to get in on the action themselves. The exact amount of wealth generated by this decade-long scheme is difficult to determine, but certain figures provide a glimpse of its magnitude. The most telling figure is the cumulative debt that derived from it, which "was larger than the combined Gross Domestic Products of every country in the world." [62] The initial bailout, approved by the W. Bush administration, provided over $204 billion in immediate relief to dozens of banks and financial institutions between October of 2008 and November of 2009 ( See the full list here). Through several rounds of quantitative easing - a process where central banks create money by buying securities from banks using "electronic cash" that did not exist before - the "US Federal Reserve's balance sheet (the value of the assets it holds) increased from less than $1 trillion in 2007 to more than $4 trillion in 2015." [63]

In layman's terms, this means that over $3 trillion was created and given to the private banking industry by the US government (via the Fed) between 2008 and 2015. Quasi-government agencies like Fannie Mae and Freddie Mac were also given nearly $200 billion, and General Motors was awarded $50 billion. [64]

In an admission of guilt, at least five "big banks" - Goldman Sachs, Bank of American, JP Morgan Chase, Citigroup, and Morgan Stanley - have agreed to settlements with the US Justice Department. The five settlements are for a combined $41.7 billion; however, after considering various factors, the actual payouts for all five institutions combined will be reduced to $11.5 billion. [65]

When considering that trillions of dollars were essentially ciphered from the American public (first through the banking schemes, then through government bailouts), this penalty amounts to virtually nothing. And, additionally, none of the people involved in this massive scheme have been sent to prison. Rather, they rode off into the sunset with unfathomable amounts of personal wealth, all of which remains completely illegitimate.

The elaborate and sometimes illegal schemes constructed by Wall Street, while detestable, are really only part of the story of financialization and investment banking. The most glaring illegitimacies regarding finance-generated wealth are speculation and common activities among shareholders and investors who buy and sell stocks. A prime example of exclusive shareholder schemes that allow wealthy investors guaranteed returns on their wealth is Apple's "Capital Return" program, which operates under the guise of attracting investors to provide "capital" in the form of stocks, and then issuing returns that are commiserate with profit growth. However, as in the case of billionaire investor Carl Icahn, we see that such schemes are hardly investments at all, but rather sure-fire ways for the wealthy few to regenerate their wealth without providing any form of capital or risk. In a June 2016 report for the Institute for New Economic Thinking, we're told that Icahn "purchased 27,125,441 shares of the publicly traded stock of Apple Inc. in August of 2013." And, "by the end of January 2014, Icahn had increased his stake in Apple to 52,760,848 shares, equal to 0.9% of the company's outstanding shares, at a total cost to Icahn of $3.6 billion." [66] When all was said and done, Icahn, "with ostensibly little mental effort," reaped a gain of some $2 billion in 32 months. He did this without providing any "capital" to Apple's supposed "capital return" program. Instead, he accomplished this simply because he was extremely wealthy and had the money to do so; or, as the report concludes, because he was "wealthy, visible, hyped, and influential." [67]

As these examples illustrate, the mortgage -backed securities scheme, along with other methods of financial trickery, have allowed the wealthy class to create massive gains on their already-illegitimate wealth. Even so-called "legitimate" investment activity, like Apple's "capital returns program," isn't much different in that they're essentially artificial systems of wealth enhancement that provide nothing of value, include no risk, and utilize phantom capital to make the rich richer and the poor poorer. Not to mention, as with the case of Apple, these return on profits are also directly tied to the massive exploitation of modern slave labor abroad.

Currency and Debt as Means to Maintain Hierarchy

"In Heaven, there are no debts - all have been paid, one way or another - but in Hell there's nothing but debts, and a great deal of payment is exacted, though you can't ever get all paid up. You have to pay, and pay, and keep on paying. So, Hell is like an infernal maxed-out credit card that multiplies the charges endlessly."

- Margaret Atwood

In addition to the artificial social relationships formed through wage labor and private property, currency and debt have long been utilized as means of control, mostly to maintain systems of hierarchy, keeping wealth with the wealthy, and keeping the masses trapped in the proverbial rat race, on that never-ending chase for coin and paper. The metaphorical "hell" that Margaret Atwood describes above is, in all actuality, our collective reality. The history of currency and control-through-debt is a long and protracted one. David Graeber's "Debt: The First 5,000 Years" (2011) details this history in a way that questions and exposes fundamental relationships between ruling classes and their nationalized and colonial subjects throughout history. This history exposes our "living hells" as nothing more than artificial creations, designed by the few to fleece and control the many.

Like other forms of exploitation, currency and debt have an inherent connection with the state, in that the state facilitates and determines the value of currency and enforces debt collections through laws and the use of force and coercion. The Hegelian dialectic that Marx relied on in his analysis of capitalist relations (i.e. capital vs. labor) is also relevant to this broader struggle between rich and poor, which has historically been represented by a fundamental struggle between creditors and debtors. Graeber explains,

"For thousands of years, the struggle between rich and poor has largely taken the form of conflicts between creditors and debtors - of arguments about the rights and wrongs of interest payments, debt peonage, amnesty, repossession, restitution, the sequestering of sheep, the seizing of vineyards, and the selling of debtors' children into slavery. By the same token, for the last five thousand years, with remarkable regularity, popular insurrections have begun the same way: with the ritual destruction of the debt records - tablets, papyri, ledgers, whatever form they might have taken in any particular time and place. (After that, rebels usually go after the records of landholding and tax assessments). As the great classicist Moses Finley often liked to say, in the ancient world, all revolutionary movements had a single program: 'Cancel the debts and redistribute the land.'" [68]

States have been intimately involved in the coining, distribution, and facilitation of currency and debt as far back as the early Roman Empire. As time has transpired, this has become an undeniable fact, even more so during the past century where "metallism" - currency value based on precious metals - has been replaced by "chartalism" - currency whose value is created purely by law (or the state). For the United States, this system based solely in fiat currency became concretized when President Richard Nixon officially abandoned the gold standard in 1971. However, as economist John Maynard Keynes had suggested four decades prior in his "Treatise on Money," chartalism was already the international norm:

"The State, therefore, comes in first of all as the authority of law which enforces the payment of the thing which corresponds to the name or description in the contract. But it comes doubly when, in addition, it claims the right to determine and declare what thing corresponds to the name, and to vary its declaration from time to time-when, that is to say it claims the right to re-edit the dictionary. This right is claimed by all modern States and has been so claimed for some four thousand years at least. It is when this stage in the evolution of Money has been reached that Knapp's Chartalism - the doctrine that money is peculiarly a creation of the State - is fully realized . . . Today, all civilized money is, beyond the possibility of dispute, chartalist." [69]

While representing crucial subjects in regards to economic theory, these ideas go beyond their intended field of study to illustrate how power relations have been established and maintained in our world. The key concept in this understanding is not currency, but debt. Among many things, currency is nothing more than a convenient way to calculate and enforce debt onto people. And this enforcement, always directed by the owning and ruling classes throughout history, is primarily used to maintain hierarchies and wealth inequities. In fact, debt, as a societal ledger and form of control, has existed long before formal markets and states. Graeber tells us,

"The core argument [of primordial-debt theory] is that any attempt to separate monetary policy from social policy is ultimately wrong. Primordial-debt theorists insist that these have always been the same thing. Governments use taxes to create money, and they are able to do so because they have become the guardians of the debt that all citizens have to one another. This debt is the essence of society itself. It exists long before money and markets, and money and markets themselves are simply ways of chopping pieces of it up." [70]

Furthermore, as anthropologists like Graeber have discovered, primitive forms of currency were primarily used as a means to facilitate social relations, and not merely to buy and sell goods:

"Anthropologists do have a great deal of knowledge of how economies within stateless societies actually worked-how they still work in places where states and markets have been unable to completely break up existing ways of doing things. There are innumerable studies of, say, the use of cattle as money in eastern or southern Africa, of shell money in the Americas (wampum being the most famous example) or Papua New Guinea, bead money, feather money, the use of iron rings, cowries, spondylus shells, brass rods, or woodpecker scalps. The reason that this literature tends to be ignored by economists is simple: "primitive currencies" of this sort is only rarely used to buy and sell things, and even when they are, never primarily everyday items such as chickens or eggs or shoes or potatoes. Rather than being employed to acquire things, they are mainly used to rearrange relations between people. Above all, to arrange marriages and to settle disputes, particularly those arising from murders or personal injury." [71]

As with other forms of illegitimate accumulation and wealth-building, debt is exposed as not just a tangible facilitator of buying, selling, and owing, but rather as an intimately humanized system designed solely to act as a social relationship. It is in this relationship where personal wealth continues its illegitimate path through human history, and where the wealthy gain an even tighter grip on their subject masses, virtually guaranteeing the continuation of massive inequities. Under capitalism, the capitalist state has supplemented its chartalism by creating a "credit monopoly" that serves multiple purposes, both facilitating the inherent contradictions of capitalism and restricting alternative systems from forming in response to these contradictions. A modern anarchist analysis on capitalist credit explains its purpose in preventing alternatives to the capital-labor business model,

"The credit monopoly, by which the state controls who can and cannot issue or loan money, reduces the ability of working-class people to create their own alternatives to capitalism. By charging high amounts of interest on loans (which is only possible because competition is restricted naturally through accumulation and the inevitable facilitation of the state) few people can afford to create co-operatives or one-person firms. In addition, having to repay loans at high interest to capitalist banks ensures that co-operatives often have to undermine their own principles by having to employ wage laborr to make ends meet." [72]

Anarchists like Proudhon emphasized the importance of addressing the credit problem alongside the labor problem,

"Just as increasing wages is an important struggle within capitalism, so is the question of credit. Proudhon and his followers supported the idea of a People's Bank. If the working class could take over and control increasing amounts of money it could undercut capitalist power while building its own alternative social order (for money is ultimately the means of buying labour power, and so authority over the labourer - which is the key to surplus value production). Proudhon hoped that by credit being reduced to cost (namely administration charges) workers would be able to buy the means of production they needed." [73]

In modern times, with the arrival of globalized, neoliberal, and monopoly capitalism, the advent of consumer credit has become a crucial component in keeping this system afloat amidst extreme and widespread inequality and dispossession. Using Doug Henwood's analysis in his 1998 book, "Wall Street: How it Works and for Whom," we can see how consumer credit is being used (in very real ways) to maintain control of the exploited majority, thus solidifying systems of illegitimate wealth and power while also providing stabilizers to avoid total collapse:

"The 1980s were marked by a rising debt burden on households as well as the increased concentration of wealth in the US. The two are linked. Due to 'the decline in real hourly wages, and the stagnation in household incomes, the middle and lower classes have borrowed more to stay in place' and they have 'borrowed from the very rich who have [become] richer.' By 1997, US households spent $1 trillion (or 17% of the after-tax incomes) on debt service. 'This represents a massive upward redistribution of income.' And why did they borrow? The bottom 40% of the income distribution 'borrowed to compensate for stagnant or falling incomes' while the upper 20% borrowed 'mainly to invest.' Thus 'consumer credit can be thought of as a way to sustain mass consumption in the face of stagnant or falling wages. But there's an additional social and political bonus, from the point of view of the creditor class: it reduces pressure for higher wages by allowing people to buy goods they couldn't otherwise afford. It helps to nourish both the appearance and reality of a middle-class standard of living in a time of polarization. And debt can be a great conservatizing force; with a large monthly mortgage and/or MasterCard bill, strikes and other forms of troublemaking look less appealing than they would otherwise." [74]

Long before capitalist notions of private property and wage labor materialized, debt provided a fundamental way to maintain and facilitate power over large numbers of people. Since the advent of the capitalist system, debt, and its intimate relationship with the capitalist state, has proven to be the thread that holds this layered exploitation together. It safeguards illegitimate wealth accumulation by constructing a tangible mechanism to enforce the inherent indebtedness that comes with being born in systems of extreme hierarchy. In this way, it serves capitalism, and its illegitimate foundation, well.

Expropriation is not Theft; It's Justice

"The rich are only defeated when running for their lives."

- C.L.R. James

It's no secret that capitalism has run amok over the past three decades. This is not to say that it has been derailed or mutated in some way. In reality, it is acting as it should; creating massive amounts of wealth for a minority through the systematic dispossession and exploitation of the majority. The era of neoliberalism - where capitalist governments have been formerly acquired by private wealth - was inevitable in the natural progression of things. An economic arrangement that relies on structural unemployment (a "reserve army of labor"), mass labor exploitation, the concentration of private property via the displacement of the majority, the forced extraction of natural resources, and constant production for the sake of conspicuous consumption needs a coercive, powerful, and forceful apparatus to protect and maintain it. The capitalist state serves this need, simply because the blatant theft of over 7 billion human beings by mere hundreds cannot continue without a massive militarization of that global minority.

Global wealth inequality has reached unfathomable heights. And wealth inequality in the United States has surpassed that of the Gilded Age. This is not due to mythological or abused forms of capitalism, so-called "cronyism" or "corporatism," "unbridled" and "unfettered" forms, or any of the adjectives that mainstream analysts insist on using to describe this system. Yes, capitalism has invariably reached certain stages in its development - neoliberalism brought the inevitable fusion of public and private power, while monopoly capitalism has reached its pinnacle - but all of these modern epochs are rooted in the most fundamental mechanisms of the system, most notably its reliance on using private property as a social relationship to exploit labor. These mechanisms have always tended toward capital accumulation and concentrated wealth for a privileged minority; and, consequently, mass displacement, alienation, and disenfranchisement for the unfortunate majority. The world's problems are the result of capitalism, in its orthodox state. It is working exactly as it is supposed to work, intensifying as time goes on.

Despite the extremes we've experienced, wealth and greed continue to rule the day; and the wealthy are not only unapologetic, they're also incredibly bold. There is an entire financial "asset protection" industry built with the sole purpose of instructing wealthy individuals on how to hide their money and avoid paying taxes. And this is done in plain sight, for all to see. A simple online search brings up dozens of companies offering these services, and "experts" offering their advice. From tutorials on how to repatriate your Offshore Funds without paying taxes to "everything you need to know about bringing your money back to the United States," the wealthy are not shy about their illegal activities. Business executives have become so bold that they've publicly admitted to stashing "hundreds of billions of dollars" in foreign banks to avoid paying taxes in the United States. And rather than prosecute them to the fullest extent of the law for tax evasion, the US government continues to "negotiate" with them to bring their money back to the US. For example, on December 15, 2010, a group of business executives met with President Obama at the White House to ask for "a tax holiday" that would allow them to "tap into over $1 trillion of offshore earnings, much of which was sitting in island tax havens." [75]

Hiding money to avoid taxation has become an elaborate and extremely lucrative business. And everyone, including the President, the IRS, Senators and members of Congress, are fully aware. According to Edward D. Kleinbard, a law professor at USC, "U.S. companies overall use various repatriation strategies to avoid about $25 billion a year in federal income taxes." [76] Despite these negotiations with the government, corporations have already figured out "legal" ways to bring the hidden money back. For example, in 2009, Merck & Co Inc., the second largest drug-maker in the U.S., "brought more than $9 billion from abroad without paying any U.S. tax to help finance its acquisition of Schering-Plough Corp., securities filings show." [77] That same year, "Pfizer Inc. imported more than $30 billion from offshore in connection with its acquisition of Wyeth, while taking steps to minimize the tax hit on its publicly reported profit." [78] Between 2009-2010, "Cisco reported $31.6 billion of undistributed foreign earnings, on which it had paid no U.S. taxes" and Merck "tapped its offshore cash, tax-free, to pay for just over half the cash portion of its $51 billion merger with Schering-Plough" and then "lent $9.4 billion to a pair of Schering-Plough Dutch units" without paying any US taxes. [79] These examples are endless. And they are, essentially, unethical, if not illegal. Negotiating with the government to bring back money (over a trillion dollars by conservative estimates) that was intentionally hidden to avoid paying taxes is the equivalent of someone stealing $200 from you, admitting they did it, and then offering to give you $20 back to let bygones be bygones.

Of course, even if these businesses paid their taxes under a stringent tax system, capitalism would still exist, and with it all of its illegitimacies. During the so-called "golden age" of the United States, where effective tax rates for the higher-income brackets were consistently in the 90th percentile (they were cut in half in the '80s and are now in the 30th percentile), mass exploitation and dispossession still remained. Globally - through traditional colonialism, military force, and the construction of modern international finance systems - the United States and other industrialized nations supplemented their higher standards of living by ravaging foreign lands, peoples, and resources. Domestically, despite the emergence of an exclusively white middle-class, masses of citizens consisting of ethnic minorities, the rural and urban poor, and women remained disenfranchised both socially and economically. In other words, the golden age was nothing more than a mass sacrifice of hundreds of millions of people abroad and at home, carried out in order to supplement a burgeoning (and relatively small) sector of the white working class in U.S.. Taxation was the compromise the owning class once agreed upon in an attempt to legitimize their illegitimate wealth. In a capitalist system built on immoral foundations, taxation isn't theft - it's a plea bargain. And, even when this deal is adhered to and effectively processed, it is not enough to undo the massive injustice that it seeks to appease. Just as reforms are not enough; and government regulations are not enough.

The leak of the Panama Papers in early 2016 showed what many of us have known all along - that wealthy individuals have not only built massive personal fortunes through illegitimate means, but that they have also constructed elaborate "asset management" schemes which allow them to hide their money, avoid paying taxes, and hoard what amounts to be trillions of dollars from the public. [80] Thoughtless, ahistoric, and emotional responses to this (like those coming from USAmerican "libertarians") may include a disdain for taxation - something that, to them, represents a form of theft, whereas the government embezzles money from individuals through the threat of force or coercion (tax laws, the IRS, law enforcement). This would be a plausible argument if the wealth and land being taxed wasn't already created through widespread embezzlement of the majority. The fact of the matter is that all personal wealth in the world has been built on a foundation of murder, extortion, exploitation, theft, illegal banking and debt schemes, colonialism, racism, slavery, and various artificial systems of hierarchy.

Just as taxation, reforms, and regulations are not enough, reparations would also fall short. For example, reparations for the descendants of American slavery, while warranted and certainly needed, would not adequately address the power dynamics created by centuries of accumulation. Giving 40 acres and a mule to one of George Washington's slaves would do nothing to address the illegitimate and residual wealth and power owned by George Washington and his family, especially when society (via the government) is the payer of such monetary justice. Rather, true justice would amount to cutting Washington's land and wealth into parcels, divvying it up amongst his slaves, and removing Washington from society (as with all criminals). These three steps are the only way to effectively expropriate illegitimate wealth: (1) liquidate the benefactor(s) of such wealth, (2) place it in a societal pool to be used for a common good, (3) and remove those who took part in the stealing of such wealth from society. This same logic and approach applies today. This is the only way to recuperate our stolen collective-wealth, while also addressing the inequities of power rooted in this theft.

The wealthy few have stolen from the world; and have enslaved, impoverished, and indebted the rest of us (over 7 billion people) in the process. They have no right to their wealth. It belongs to us - it belongs to global society. Not so we can all live extravagant lifestyles, but rather so we can satisfy the most basic of human rights and needs - food, clothing, shelter, healthcare, education - and thus carry on our lives as productive and creative human beings. Taxation is a pathetic compromise to thousands of years of mass extortion. Reforms and regulations have tried and failed. Reparations even fall short of justice. And voting for representatives from the ruling class (who are directly employed and controlled by the owning class) with hopes of them voting away their own wealth has been proven to be a perpetual act in futility. The only just solution is to recuperate this stolen wealth; to destroy these extreme systems of hierarchy and control; to allow human beings the dignity and self-determination they deserve; and to expropriate the expropriators once and for all. Righting centuries of wrongs is not "theft," it's justice.

Colin Jenkins is founder and Social Economics chairperson at the Hampton Institute.

Notes

[1] Peter Kropotkin, The Conquest of Bread, Chapter 1 (1892)

[2] "Justifiable" defined as "being able to be shown to be right or reasonable; defensible."

[3] Gwenda Blair (2000). The Trumps: Three Generations That Built an Empire. Simon and Schuster.

[4] Brian Miller and Mike Lapham (2012) The Self-Made Myth: The Truth About How Government Helps Individuals and Businesses Succeed. Berrett-Koehler Publishers.

[5] Blair (2000)

[6] Miller and Lapham (2012)

[7] Howard Zinn, A People's History of the United States, p. 50.

[8] Carl Bridenbaugh, Cities in the Wilderness: The First Century of Urban Life in America (New York: Oxford University Press, 1971)

[9] Daniel Vickers, A Companion to Colonial America (Blackwell Publishing, 2003, p. 289)

[10] Julia Ott, Slaves: the capital that made capitalism, 4/9/14 http://www.publicseminar.org/2014/04/slavery-the-capital-that-made-capitalism/

[11] Sven Beckert, Empire of Cotton: A Global History, p. 119

[12] Thomas Piketty and Gabriel Zucman, Capital is Back: Wealth-Income Ratios in Rich Countries 1700-2010, Paris School of Economics: July 26, 2013 http://www.parisschoolofeconomics.com/zucman-gabriel/capitalisback/PikettyZucman2013WP.pdf

[13] Fredrick Douglass address to the Louisville Convention, 1883, http://people.ucls.uchicago.edu/~cjuriss/US/Documents/US-Jurisson-Unit-2-Douglass-Address-to-Louisville-Convention-1883.pdf

[14] Sven Beckert and Seth Rockman, How Slavery Led to Modern Capitalism, 1/24/12 https://www.bloomberg.com/view/articles/2012-01-24/how-slavery-led-to-modern-capitalism-echoes

[15] Ibid

[16] Zinn, p. 65.

[17] Jackson Main, The Social Structure of Revolutionary America.

[18] Cornel West, Democracy Matters, pp. 210-211

[19] Zinn, p. 90.

[20] Ferdinand Lundberg, America's 60 Families. http://www.pdfarchive.info/pdf/L/Lu/Lundberg_Ferdinand_-_America_s_60_Families.pdf

[21] G. William Domhoff, Who Rules America? On Wealth, Income, and Power. University of California at Santa Cruz. http://www2.ucsc.edu/whorulesamerica/power/wealth.html

[22] Karl Marx, Capital: Volume One. Chapter 32, Accessed at https://www.marxists.org/archive/marx/works/1867-c1/ch32.htm

[23] Raya Dunayevskaya, American Civilization on Trial: Black Masses as Vanguard.

[24] Ibid

[25] Ibid

[26] Ibid

[27] Peter Linebaugh, Stop, Thief!

[28] Ibid

[29] Ibid

[30] August Meier and Elliott Rudwick, Along the Color Lines: Explorations in the Black Experience, p. 18

[31] Julia Ott, Slaves: the capital that made capitalism, 4/9/14 http://www.publicseminar.org/2014/04/slavery-the-capital-that-made-capitalism/

[32] Sven Beckert and Seth Rockman, How Slavery Led to Modern Capitalism, 1/24/12 https://www.bloomberg.com/view/articles/2012-01-24/how-slavery-led-to-modern-capitalism-echoes

[33] An Anarchist FAQ: Why are anarchists against private property? Infoshop.org. Accessed at http://www.infoshop.org/AnarchistFAQSectionB3

[34] Emma Goldman, What I Believe (1908) Accessed at https://theanarchistlibrary.org/library/emma-goldman-what-i-believe

[35] Ibid

[36] Rosa Luxemburg, What is Bolshevism? (1918) Accessed at https://www.marxists.org/archive/luxemburg/1918/12/20-alt.htm

[37] Ibid

[38] Karl Marx, Capital: Volume One (1867) Chapter Thirty-Two: Historical Tendency of Capitalist Accumulation. Accessed at https://www.marxists.org/archive/marx/works/1867-c1/ch32.htm

[39] An Anarchist FAQ: Why are anarchists against private property? Infoshop.org. Accessed at http://www.infoshop.org/AnarchistFAQSectionB3

[40] Ibid

[41] Pierre-Joseph Proudhon, What is Property? (1840) Accessed at https://theanarchistlibrary.org/library/pierre-joseph-proudhon-what-is-property-an-inquiry-into-the-principle-of-right-and-of-governmen

[42] Jean-Jacques Rousseau, "Discourse on Inequality," The Social Contract and Discourses. Everyman Paperback (1993), p. 84.

[43] An Anarchist FAQ: Why are anarchists against private property? Infoshop.org. Accessed at http://www.infoshop.org/AnarchistFAQSectionB3

[44] Ibid

[45] Ibid

[46] Karl Kautsky, Ultra-imperialism (1914) Accessed at https://www.marxists.org/archive/kautsky/1914/09/ultra-imp.htm

[47] David Graeber (2011) Debt: The First 5,000 Years, Melville House: NY, p. 311.

[48] Ibid, p. 311

[49] Claude Kabemba, Undermining Africa's Wealth, the Open Society Initiative for Southern Africa, 3/2/14, http://www.osisa.org/economic-justice/blog/undermining-africas-wealth

[50] Smedley Butler, War is a Racket (1935) Accessed at http://www.ratical.org/ratville/CAH/warisaracket.html

[51] Alain Martin, Haiti and the Ghost of a hundred years, 7/30/15, http://www.hamptoninstitution.org/haiti-and-the-ghost.html

[52] VI Lenin, Imperialism: The Highest Stage of Capitalism (1917), Chapter 7, Accessed at https://www.marxists.org/archive/lenin/works/1916/imp-hsc/ch07.htm#fwV22P268F01 )

[53] Frank Lechner, Globalization theories: World-System Theory, 2001

[54] Lucien Degoy, Samir Amin: Colonialism is Inseparable from Capitalism, IHumanite, 1/28/06, http://www.humaniteinenglish.com/spip.php?article70)

[55] Ibid

[56] Ibid

[57] Andrew Soergel, 5 Takeaways from the world's widening wealth gap, US News, 1/19/16, http://www.usnews.com/news/slideshows/top-1-percent-get-richer-as-world-wealth-gap-widens-says-oxfam

[58] Jeriah Bowser, An Inquiry into the Origins and Implications of Land Ownership, 12/27/13. Accessed at http://www.hamptoninstitution.org/implications-of-land-ownership.html

[59] Chris Hedges, Overthrow the Speculators. Common Dreams, December 30, 2013. Accessed at http://www.commondreams.org/views/2013/12/30/overthrow-speculators

[60] Graeber, Debt, pp. 15-16

[61] Colin Jenkins, A Predictable Disaster: Exposing the Roots of the 2008 Financial Crisis, 6/7/13. Accessed at http://www.hamptoninstitution.org/preddisaster.html

[62] Graeber, Debt, p. 16

[63] What is Quantitative Easing, The Economist, 3/9/15 http://www.economist.com/blogs/economist-explains/2015/03/economist-explains-5

[64] Bailout List, Propublica.org https://projects.propublica.org/bailout/list

[65] David Dayen, Why the Goldman Sachs Settlement is a $5 Billion Sham, New Republic, 4/13/16, https://newrepublic.com/article/132628/goldman-sachs-settlement-5-billion-sham

[66] Lazonick, Hopkins, Jacobson, Institute for New Economic Thinking, 6/6/16 http://ineteconomics.org/ideas-papers/blog/what-we-learn-about-inequality-from-carl-icahns-2-billion-apple-no-brainer

[67] Ibid

[68] Graeber, Debt, p. 8

[69] John Maynard Keynes (1930) A Treatise on Money. Republished by AMS PR, Inc, 1976.

[70] Graeber, Debt, p. 56

[71] Graeber, Debt, p. 60

[72] An Anarchist FAQ: Why are anarchists against private property? Infoshop.org. Accessed at http://www.infoshop.org/AnarchistFAQSectionB3

[73] Ibid

[74] Ibid, referencing Doug Henwood, Wall Street: How it Works and for Whom (1998), Verso, p.64-66

[75] Jesse Drucker, Dodging Repatriation Tax Lets U.S. Companies Bring Home Cash, Bloomberg Technology, 12/29/10 http://www.bloomberg.com/news/articles/2010-12-29/dodging-repatriation-tax-lets-u-s-companies-bring-home-cash

[76] Ibid

[77] Ibid

[78] Ibid

[79] Ibid

[79] Eric Lipton and Julie Creswell, Panama Papers Show How Wealthy Americans Made Millions. NY Times, 6/5/16, http://www.nytimes.com/2016/06/06/us/panama-papers.html?_r=0

Gordon Gekko's America

By Sean Posey

On October 19, 1987, a worldwide stock market crash-dubbed Black Monday in the States-interrupted the go-go 1980s. Only weeks after that panic-filled day, Oliver Stone's meditation on the decade of greed, Wall Street, hit the theaters. The story of Bud Fox, a wannabe master of the universe, and his Machiavellian mentor Gordon Gekko, served as a morality tale that America did not want to hear at the time. (The film proved to be far more popular in later years than it was in 1987.) And many who did see the film deeply misunderstood its central lessons.

A generation of future brokers and investment bankers cited the movie as a central influence in their decision to go to work on Wall Street; however, Gordon Gekko, the flashy, glib, and dangerous corporate raider, became a lasting symbol for the economic and moral transition America has undergone over the past few decades. [1] The character's ruthless worldview is now the norm, and not just for Wall Street where the "21st century children of Gordon Gekko," as Australian Prime Minister Kevin Rudd referred to them in 2007, rule, but for society as a whole.[2] Gekko and Gekkoisms have penetrated the political, economic, and cultural fabric of America. The age of Gekko is a terrifying world where the winners "make the rules" and the losers "get slaughtered."[3]

The late 1980s represented an intoxicating time in American life. Larger than life millionaires and billionaires penetrated the popular imagination like never before. Jim and Tammy Faye Bakker, Ivan Boesky (the crooked Wall Street insider), Michael Milken (who partially inspired the Gekko character), Donald Trump (who is bringing the spirit of the 1980s back to the presidential stage), and even John Gotti, who brought a flashy 1980s sensibility to the New York Mafia, all represented the fabulous wealth that accumulated to a lucky few. But the machinations of Wall Street's elite in particular, captured the spirit of the era.

Wall Street emerged as a cautionary tale during a time when caution went right out the window. New economic experiments in the realm of government and finance (supply side economics, the deregulation of thrifts, etc.) led to great crises: rapidly increasing inequality and the savings and loan scandal. Stone's film targeted the exotic world of high finance, complete with well-dressed corporate raiders and fortunes accumulated through the destruction of companies.

In the film, Bud Fox (played by Charlie Sheen) comes from blue-collar roots and is looking to leapfrog from the world of a junior broker to the esteemed realm of investment banking. His prospective mentor is Gordon Gekko (portrayed by Michael Douglas), a flashy executive who symbolizes the worst aspects of both Wall Street and American capitalism. Although Gekko is framed as the villain, many audiences responded positively to the charming greenmailer. Both Stone and Douglas later remarked that they met numerous individuals who readily admitted that Gekko inspired them to pursue a career on Wall Street. [4]

Gekko did not just symbolize an era, however; he proved to be a prescient philosopher, introducing America to what would soon be its future. Late in the film, Bud Fox, in a crisis of conscience, begins to turn away from his amoral idol. Gekko, sensing his hesitation, explains to Fox how the world of the 1980s really works:

"It's all about bucks, kid. The rest is conversation… It's not a question of enough. It's a zero-sum game, somebody wins, somebody loses. Money itself isn't lost or gained-it's simply transferred from one perception to another."

"The richest 1 percent of this country owns half our country's wealth, five trillion dollars… You got 90 percent of the American public out there with little or no net worth. I create nothing. I own. We make the rules, pal: the news, war, famine, upheaval, the price of a paper clip. We pick that rabbit out of the hat while everybody sits out there wondering how the hell we did it."

"Now your not naïve enough to think we are living in a democracy, are you, Buddy? It's the free market." [5]

Gekko's speech was far ahead of its time. The share in national income going to the top decile in the U.S., after dropping sharply following the Great Depression, returned to a rate of 50 percent by the turn of the century.[6] In 2005-2006, a leaked series of reports by analysts at Citigroup described an emerging "plutonomy," that is an economy driven by the spending of a small plutocratic class. [7] In many ways, America has returned to the Gilded Age, and it is once again a zero-sum game where those in the oligarchic plutocracy make the rules.

Government played a central role in the transition to a Gekko-esque economy. While Gekko pined for "the days of the free market" in Wall Street, President Reagan proclaimed, "Government is the problem."[8] This approach led to widespread efforts to deregulate the economy at almost every level, which coincided with reducing top tax rates on the wealthy.

Remarkably enough, the Clinton administration in the 1990s echoed Reagan and Gekko's sentiments: "The era of big government is over," Clinton declared. [9] The deregulation of the financial system proceeded apace with the Financial Services Modernization Act of 1999, which repealed part of the New Deal-era Glass-Steagall Act, and the Commodity Futures Modernization Act of 2000, which largely freed OTC derivatives from significant regulation. Economic bubbles began to emerge, and the sordid culture of Wall Street continued to thrive.

The days of the corporate raiders waned after the decade of greed, but with the Stock Market reaching new highs in the 1990s, a new generation of Wall Streeters looked to Gekko as a figure to emulate. Boiler Room, released in 2000, tells the story of a misguided young broker (Giovanni Ribisi) who goes to work for a shady chop shop firm during the height of the market. These young wannabes lack any of the charm of Gekko, but they emulate him all the same. When Ribisi's character goes to the home of the firm's head recruiter (Ben Affleck), he encounters a group watching Wall Street, which several characters recite from heart as it plays. And like down-market versions of Gekko, the employees of J.T. Marlin rip-off their clients with aplomb on their way to obscene riches. "There's no honor in taking that after school job at Mickey Dee's, honor's in the dollar, kid," Ribisi's character intones. "So I went the white boy way of slinging crack-rock: I became a stockbroker."[10]

Wall Street began to be used in ethics classes in business school, but judging by the behavior of the financial industry in the first decade of the 21st century, the moral lessons of the film apparently fell on deaf ears. Journalist Philip Delves Broughton describes how he remembers students at Harvard responding to Gekko's speeches: "At my old business school, Harvard, Gekko's speech electrified a snoozy morning class on leadership. By the time Gekko was done berating the board of Teldar Paper, the entire class was grinning and alert. For most MBA students that speech is less a parody than a guiding philosophy."[11]

"Gekko was merciless, but if he were on the Street today, the hedge fund guys would eat him alive," Fortune joked in a cover story on the old character in 2005.[12] The ruthlessness of the new Wall Street was confirmed by the events of 2007-2008. The children of Gordon Gekko brought the financial industry and indeed the country itself to its knees. Just as newly elected President Obama began bringing Wall Street scions like Lawrence Summers and Timothy Geithner into his new administration during the darkest days of the Great Recession, Oliver Stone readied Gordon Gekko for another appearance on the big screen.

Wall Street: Money Never Sleeps introduces audiences to an aged Gekko, recently released from prison after a laughable eight years. (Michael Milken only served two years in prison, and no major figures served prison time as a result of the financial meltdown of 2007-2008.) A free man, Gekko goes on a speaking tour in support of his memoirs. Addressing an auditorium of college students, he exclaims that, "Someone reminded me I once said 'Greed is good'. Now it seems it's legal." [13]

Indeed, the extreme views of Gordon Gekko circ. 1987 had been firmly baked into the culture by 2010. The titans of the financial industry knowingly drove their own companies into the ground in the name of short-term (personal) gain. And far from being punished, they were allowed to collect enormous bonuses while millions lost their homes and their livelihoods in a recession that continues to be a haunting reality for much of the country. Once again, a seemingly contrite Gekko plays the prescient sage in the sequel: "The system is insolvent. No one knows what to do next except repeat the insanity until the next bubble blows. That'll be the one, the big one."

Six years after Wall Street: Money Never Sleeps, little has changed. According to economist Emmanuel Saez, the top 1 percent of earners received 95 percent of the income gains between 2009-2012.[14] Conspicuous consumption is back on the rise, and Donald Trump, one of the most well known figures from the era of the original Wall Street, is the Republican candidate for president. In a fitting twist, Trump actually appears in a barbershop scene alongside Gekko in deleted scenes from Wall Street: Money Never Sleeps.

In 2013, Martin Scorsese released The Wolf of Wall Street, another well-timed tale of "greed is good" for post-Great Recession America. The center of the story is Jordan Belfort, one of the most notorious figures in the financial industry during the 1980s and 1990s. Leonardo DiCaprio's portrayal of Belfort represents a 21st century Gordon Gekko reborn as a "financial bro." Belfort, who made a large fortune on the backs of poorly informed blue-collar investors, comes across in an almost glamorous light-one of the chief criticisms of the film. During an advanced screening at the Regal Battery Park Theater in New York City, audiences cheered Belfort's on-screen exploits, including efforts to procure cocaine and prevent the feds from ensnaring criminal members of his own firm.[15]

The blame does not rest solely with Scorsese or the cast of the film, however. Lionizing the lifestyles of the rich and ruthless has become an American pastime. Even though movements like Occupy Wall Street have emerged to challenge the narrative of 'Greed is Good,' the Gekkos of the world continue to remain appealing characters to an American public inculcated into a mantra of success at any cost. Reality television shows are but one of the myriads of ways that a zero-sum society of Hobbesian dimensions is impressed upon us. Considering this, it is no surprise that America appears to be lurching toward accepting a modern day Leviathan, Donald Trump, as president. For a world where the ethics of Gordon Gekko dominate is a world where fear is bred by insecurity, and insecurity followed perhaps by authoritarianism.

Notes

[2] Kevin Rudd, Edited extract of the speech, "The Children of Gordon Gekko," October 6, 2008, The Australian. http://www.theaustralian.com.au/archive/news/the-children-of-gordon-gekko/story-e6frg7b6-1111117670209 (accessed May 24, 2016).

[3] Wall Street , directed by Oliver Stone, 20th Century Fox, 1987.

[4] Philip Delves Broughton, "Gordon's Back," London Evening Standard, September 14, 2009.

[5] Ibid.,

[6] Thomas Piketty, Capital in the Twenty-First Century (Cambridge: Bellknap Press, 2014), 334.

[7] Ajay Apur, Niall Macleod, Narendra Singh, 'The Plutonomy Symposium - Rising Tides Lifting Yachts," Citigroup, Equity Strategy, The Global Investigator, September 29, 2006.

[8] "Inaugural Address," Ronald Reagan, Washington, D.C., January 20, 1981.

[9] "State of the Union Address," Bill Clinton, Washington D.C., January 23, 1996.

[10] Boiler Room , directed by Ben Younger, New Line Cinema, 2000.

[11] Broughton, "Gordon's Back."

[12] Andy Serwer, Fortune, "Is Greed Still Good?" June 2005.

[13] Wall Street: Money Never Sleeps , directed by Oliver Stone, 20th Century Fox, 2010.

[14] Emanuel Saez, "Striking it Richer: The Evolution of Top Incomes in the United States, " UC Berkeley, September 3, 2013.

[15] Steve Perlberg, Business Insider, "We Saw 'Wolf of Wall Street' with a Bunch of Wall Street Dudes and it was Disturbing," December 19, 2013.

Lying Down On the Job: The Ableist, Racist, Classist Underpinnings of 'Laziness'

By Lindsey Weedston

Hello, I'm a lazy Millennial.

In other words, I'm from a generation that has worked more hours for less money than any generation before me, but occasionally I eat a granola bar for breakfast instead of pouring myself a bowl of cereal. According to some, including many writers of online thinkpieces, that's enough to make me "lazy."

But the problem isn't me, or young people in general, or any group that's historically been decried for its idleness. Like Millennials, groups that are called "lazy" are often the hardest-working people around. They're just subject to ableism, racism, classism, and other bigotry that codes exploitation or exhaustion as "unwillingness to work."

I myself have had a very confusing relationship with "laziness" from a young age, often being called "lazy" for enjoying reading and video games by the same parents who praised me for always getting my homework done on time.

Needless to say, I became rather confused about the quality of my work ethic. Was I lazy or not? In my teens, I developed an anxiety disorder and a perfectionism that made academic shirking impossible, but the constant state of worry disrupted my sleep and left me so exhausted that I would often come home from school and go straight to bed for a nap. Sometimes, all I could do was lay in bed, awake, ruminating on everything I could possibly worry about.

But because I was in bed, this was called "laziness."

In adulthood, I encountered yet more inconsistencies about what it meant to be "lazy." Like many young adults, I started out working in the food and customer service industries, before I eventually got a job as a content writer for a digital marketing company.

I worked so little at that office job, I couldn't believe it. I could spend multiple hours each day scrolling through Tumblr or playing on social media. My "work" time involved reading articles vaguely related to my work-mostly because there wasn't much work for me to do. Compared to being on my feet all day, being expected to work every moment on the clock, it was nothing.

I worked three times as hard at my food and customer service jobs as I did at any of my digital marketing positions. And yet contemptuous thinkpiecers keep on describing people who work in those industries as "lazy." Why don't you get a REAL job? Like reading Tumblr while sitting at a desk, instead of busting your ass at McDonald's.

According to Dr. Alison Munoff, a licensed clinical psychologist, "laziness" is nothing more than a value judgement.

"'Laziness' is not a personality trait, it is simply a matter of a lack of proper motivation and reinforcement, as it is a behavioral pattern rather than a part of who we are," says Dr. Munoff. "The ability to actively approach a task in a time-effective manner changes depending on the task and its value in our lives. For example, in a situation of obtaining limited resources, people find themselves quite motivated and resourceful, meaning that this task is simply a priority based on its value and necessity, and has little to do with someone's personality. Unfortunately I find that when asked about the first time people were told they were being 'lazy,' it was from a parent or caregiver who was unsuccessfully attempting to motivate the child without a good understanding of the way this idea would be carried forward."

In nature, animals spend a lot of their time being idle. Most of the footage shot of big cats like lions are of them lazing around. Part of this is because many of them are nocturnal, but it's also because animals will hunt, forage, and eat until they're full, and then most of the rest of their time is spent conserving energy. Laying around doing pretty much nothing is completely natural. It's adaptive. Yet laziness has this negative connotation in many human societies. And that negative connotation is often deployed in ableist, racist, and classist ways.

Basically every race of color has been called "lazy" by white people in the U.S. at one time or another. This is completely absurd considering the fact that people of color built this nation with their bare hands. From the Chinese immigrants building our railroads to our entire economy being built on the backs of black slaves, the United States owes everything to exploited, underpaid, and incredibly hard-working people of color.

Today, we can all enjoy reasonably priced produce thanks to the many exploited Latin undocumented immigrant workers picking our fruit and vegetables-labor that is so intensive that we "non-lazy" white people simply can't handle it. And let's not forget that all of this land was stolen from the Indigenous tribes that were here before we floated over and laid claim to it all. Isn't stealing other people's hard work supposed to be lazy?

Or is it just that it's easier to call people lazy than admit that you exploited them?

Even if you're not racist, you've probably used the idea of laziness in a way that hurts a lot of people. I still struggle with an anxiety disorder and go through bouts of depression, and a lot of what's involved in these mental illnesses looks like what people call "laziness." Depression saps your energy and makes everything seem pointless. Anxiety is paralyzing, making even some of the simplest tasks (like calling people on the phone) seem daunting, so I avoid them.

Combine the two and you've got me huddled into a ball on the bed, unable to do anything but listen to Netflix playing in the background. It looks like laziness, but I'm actually engaged in an exhausting war in my own head. Anxiety is like pushing a giant boulder in front of you wherever you go, and depression is like dragging a giant boulder attached to your legs by chains.

People with physical illness and disability are also prone to being accused of laziness, especially if that illness or disability is not visible to others. There are people who are nearly constantly in pain or constantly fatigued, but you would never know by looking at them. These individuals work much harder than able-bodied and "healthy" people. Not only do they often have to work to survive because disability payments (if they can get them) are not nearly enough, they have to navigate a world that caters to able-bodied people, and they have to navigate that world while their bodies work against them. But article after article decries the "laziness" of people who use motorized carts or take elevators up one floor instead of using the stairs, not for a second thinking that there are people who wouldn't be able to shop or go up floors at all without these "conveniences."

It's not just articles, either. Politicians demonize people who are too sick or disabled to work, calling them "lazy" as justification for taking away the meager allowance our government gives them-which is not enough to live on, let alone cover medical bills. That ableism intersects with classism, with people assuming that those living in poverty or on welfare must be too lazy to go to school or get a better job. Racism shows its face here, as well, particularly in the myth of the "welfare queen." And the hatred leveled at fat individuals under the guise of thinking them "lazy" can be very intense.

It's easier to think of someone as "lazy" than to face the fact that school costs too much, that better jobs are inaccessible, that childcare is unaffordable, that people are forced to work so hard for so little that there's no way they could have enough energy to attempt schooling or finding better work, and that what we give to people who can't work is insufficient to the point of being shameful. I could say that calling people lazy is, in itself, lazy, but it's not just an intellectual shortcut. It's a defense mechanism.

Everyone has a finite amount of energy. Some of us have greater drains on our pool of energy than others, whether it comes from the stress of racial microaggressions, the stress of poverty, or mental or physical illness. Needing more time to recover isn't laziness. Having less time or energy to make breakfast than the previous generation isn't laziness. When you take a second to look into the reasons behind the behavior, you'll never end up finding laziness. Because laziness isn't real.

This was originally published at The Establishment.

Revolutionary Shop Stewards and Workers Councils in the German Revolution

By Kevin Van Meter

The following is a review essay of Ralf Hoffrogge's Historical Materialism Series book Working-Class Politics in the German Revolution: Richard Müller, the Revolutionary Shop Stewards and the Origins of the Council Movement .

If Ralf Hoffrogge were writing within an American context rather than a German one, he would be situated between two important developments in the United States. A new cohort of social movement historians is addressing the gaps in anarchist, anti-authoritarian, and left-communist historiography. Neighboring this is a resurgence of interest in workers' councils historically and in the contemporary period. With the recent translation and subsequent publication of Working-Class Politics in the German Revolution: Richard M üller, the Revolutionary Shop Stewards and the Origins of the Council Movement in two editions, Hoffrogge enters this discourse with a extremely detailed political biography of a nearly unknown militant whose finest years coincided with the German Revolution and workers' council movement of 1918. Communists of various stripes have laid claim to Rosa Luxemburg and anarchists to Gustav Landauer, both murdered as the revolution was suppressed with the latter yelling "to think you are human" as he was stomped to death. Council communists and autonomists have been gifted Richard Müller, who was forgotten in part because he survived.

Revolutions often begin in desertion: sailors, not shop stewards, led the German uprisings of 1918. The end of the Great War steered into the Russian Revolution with soldiers, worn through their boots, joining upheavals rather than returning to their old lives; resulting in the Bolshevik government of October 1917. A year later on October 29th, in a port city 250 miles northwest from Berlin, seamen rebelled, forming sailors councils that later joined with those of workers. Rebellions led by sailors quickly spread across the coast. By November 9th, workers in Berlin left the factories, though daily meetings and shop floor deliberations had begun amongst various revolutionary factions as early as the 2nd. German sailors and workers joined Russians, Greeks, Irish, Mexicans, Egyptians, and Poles as revolutions, often incorporating councils modeled on Russian soviets, emerged across the planet. The Red Scare in the United States prevented circulation of struggles to the American context. Elsewhere in Germany, the Bavarian Council Republic arose November 7th, though it would be defeated electorally in January 1919 with the left parties and radicals pushed out of the government.

There was a constellation of left parties and organizations in Germany leading up to the revolution. The Social Democratic Party of Germany (SPD) had sought a parliamentary avenue to repair the country following economic crises and war; winning the war was viewed as a step toward parliamentary democracy. Karl Liebknecht, like Luxemburg (whom he was eventually killed alongside), was expelled from the SPD due to his antiwar agenda, resulting in the formation of the Independent Social Democratic Party of Germany (USPD). The Spartacus League, led by Liebknecht and Luxemburg, initially functioned as the left wing of of the SPD before merging with the USPD as they increasingly sought revolution through parliamentary means using the vehicle of the workers' councils. Then the Spartacists founded the Communist Party of Germany (KPD) in December 1918. After the revolution of November they attempted to consolidate the left wing of the workers movement and bring the workers' councils and shop stewards under their auspices. Launching their own ill-fated insurrection on January 4th, in what is now referred to as the Spartacist uprising, the KPD was suppressed on the 19th; the arrest and execution of its leadership quickly followed. Meanwhile, outside of these shifting allegiances and political wrangling, the sailors and workers' councils persisted as the democratic, organizational expression of working-class abilities and needs.

As with Antonio Gramsci, Liebknecht and Luxemburg enter into the historical record. What is less recognized is how these party formations sought to capture the democratic and revolutionary impulses of the councils in order to form a workers' state. Müller and the shop stewards stood in opposition to these attempts, even as they participated in governing bodies. There is a fundamental political disagreement here. With regard to the shop stewards, Hoffrogge writes, "Their forum was the factory and their form of political action was the general strike" (p. 62). As a young unionist Müller struck out against the imposition of Taylorism. He was to go from a lathe operator to become the temporary head of state for the revolutionary republic. Meanwhile, as a delegate he was the workers' representative in the daily operations of the revolution. Reflecting on Müller's views, Hoffogge offers,

The councils were the original representation of the working class. In the eyes of his opponents, the mass mobilization, which turned every street and factory into a parliament, was 'pure anarchy,' the opposite of politics. The councils' potential for a different structure of representation was opposed and suppressed by the coalition of traditional elites purporting to represent the 'people' (p. 91).

Müller served as workers' council delegate to the Executive Council of the Council of People's Deputies, the governing body of the councils and hence post-revolutionary Berlin. His position as chair meant he was in charge of the Council and in turn the government. The experiment of the Executive Council was to be short-lived since on December 16th the machinery of state was subsumed under the Central Council; the Executive Council, with its direct relationships to sailors and workers' councils, was jettisoned. These maneuvers from above would mark the decline of the November Revolution. Before a year had past, in August 1919, the constitution that would become the guiding document of the Weimer Republic was instituted. Nevertheless workers in central Germany launched rebellions during March 1921 and again in Hamburg throughout October 1923. With the end of the Hamburg uprising the romance of the Germany Revolution was extinguished.

Hoffrogge details the process of revolutionary upheaval, followed by the innumerable ways it disintegrated. Hoffrogge observes that workers' councils, drawing on Müller's own writing of 1913, "had to work out collective practices, like refusal of overtime or slow-downs, gradually and painstakingly" (p. 18). These machinations do not translate into parliamentary politics. Two key political lessons result. First, as delegates and members of councils, ordinary workers are ill-equipped to jostle with party bureaucrats and professional politicians in government bodies. In fact, it is not only the structural incorporation of workers' councils into the government that lead to their defeat. The very day-to-day mechanisms of government dominated by the party and politicians erode the democratic impulses of delegates while replacing their spontaneous enthusiasm with proceduralism. As a result, and secondly, preparing for governing post-revolutionary conditions is an important area for future theorization and organizing. However, Hoffrogge has produced an intellectual history not a genealogy or strategic manual for potential workers' councils. The book suffers for lack of a proper introduction and overview for those unfamiliar with the German Revolution. The first such summary appears in chapter five. Many readers will have trouble acclimating to the context Müller was operating within.

There are two ways to read Working-Class Politics in the German Revolution: as a social movement history or as a biography. Readers looking for the former will stop at chapter nine and forgo the final three chapters, which address Müller's developments after leaving politics. But for those looking for the arc that is a political life will discover Hoffrogge's excruciatingly detailed account of the lathe operator who was to become temporary head of the German Republic before "returning to obscurity" (p. 230).

Read as a social movement history, Hoffrogge joins the resurgence of interest in workers' councils following the 2008 planetary economic crisis. Edited collections, including, Ours to Master and to Own: Workers' Control from the Commune to the Present (where Hoffrogge's writing on Müller first appeared in English), New Forms of Worker Organizing: The Syndicalist and Autonomist Restoration of Class-Struggle Unionism, and An Alternative Labor History: Worker Control and Workplace Democracy have reintroduced the concept of the workers' council to contemporary labor organizers, although, a new edition of labor historian Peter Rachleff's out-of-print Marxism and Council Communism would provide a historical overview of these ideas and practices. As social movement scholars, Hoffroge and others will have to contend with the short twentieth century where workers' councils appeared as part of revolutionary upheavals. When considered chronologically, these include: Russia, Poland, Germany, Italy, Ireland, China, Spain, Hungary, France, Chile, and Iran. Did what began in 1905 conclude in 1978?

While Hoffrogge addresses missing historiography, I am afraid that the specificity of the subject matter - Müller, shop stewards, Berlin in 1918 - will draw readers away from the considerable details of day-to-day organizing and operations of workers' councils. Admittedly this is a criticism of the reader rather than the author. The Brill edition is a pricy hardback suitable for academic libraries. Historical Materialism has corrected this initial error by providing a softcover version at just over the cost of buying a round of bier for Luxemburg, Liebknecht, Landauer, and Müller.

Hoffrogge, Ralf. Working-Class Politics in the German Revolution: Richard M üller, the Revolutionary Shop Stewards and the Origins of the Council Movement. Joseph Keady, trans. Chicago: Haymarket Books. 2015. 253 pp. $28.00 softcover. ISBN 978-16-08-46550-7; and, Leiden & Boston: Brill. 2015. 253 pp. $141.00 hardback. ISBN 978-90-04-21921-2.

Brazil's Gramscian Moment: On Cultural Hegemony and Crisis

By Jacques Simon

With the Brazilian senate confirming Dilma Rousseff's impeachment procedure, it seems increasingly likely that Brazil could soon see the long-loved Workers Party (PT) out of office. Given the seemingly unshakable support that the party had up until a few years ago, the deep political crisis that Brazil faces today may seem a bit surprising. How is it that, after winning four consecutive elections, three by a landslide, the PT's Dilma Rousseff is now facing impeachment charges, and people are in the streets by millions? Why have Brazilians completely turned their backs on the PT, despite it having enjoyed fourteen years of political hegemony?

The mainstream media has identified two main causes to the current political turmoil in Brazil.

The first is corruption. Operacao Lava Jato (operation carwash), until recently led by the now famous Justice Moro, has shaken the political class to its core. Millions of reais flowing from top Petrobras executives into the pockets of the political elites have gotten widespread news coverage. Of course, this is not factually incorrect, but it disregards the fact that corruption has been the name of the game in Brazilian politics since the end of the military regime in 1985.

In fact, Lula's 2006 re-election happened in the midst of the Mensalão scandal, where the PT was accused of buying votes in congress. Transparency International has kept Brazil at a steady 76th on 167 in terms of global corruption between 2012 and 2015, even though the Petrobras scandal started in 2014.

Corruption is such a common occurrence in the country that a term has been created to describe Brazilian institutions' feeble reactions to shady business. In Brazil, when a scandal is said to "end in pizza," it means that charges where not laid out to the extent that they could or should have.

It seems that the corruptibility of the political elite is taken for granted by Brazilians. While it may have been an accelerating factor in the current crisis, it certainly does not seem to be the determinant variable in Rousseff's demise, who, in fact, is not even facing corruption charges unlike her opponents.

The second cause to the political crisis identified by the mainstream media has been the media itself.

Some have pointed the finger at the largely right wing and anti-PT bias of Brazil's largest news corporations. Once again, while not factually false, that position of the media is not a recent occurrence.

The same families have held the five main media companies for decades. Grupo Globo for instance, the country's largest media corporation, has been privately owned by the Marinho family since its creation in 1965. There has not been a recent change in the media's ideological affiliation: the right-wing mainstream media has been a constant throughout the PT rule.

Once again, it seems that this variable may be an accelerating factor in the PTs downfall, but it certainly does not seem to be the determinant variable.

In reality, two things have actively participated in Dilma's crash: an economic recession, and her turn away from the PT's traditional politics. All else is anecdotal.

Let's turn to an influential political theorist of the early twentieth century to further elaborate on that.

This conclusion can be reached by using Antonio Gramsci's concept of cultural hegemony. It might be a bit of an overstatement to say that the Italian philosopher is making a come back. Undoubtedly, most people still do not know who he was, and few are aware of the importance of his theories. It is however, somewhat satisfying to see that Google searches for his name have been growing exponentially since the early 2000s and show no sign of slowing down.

It seems that the global capitalist crisis of 2008, which shook the entire world, has made a few people question the strength and general positive nature of the economic system we are living in. This kind of uncertainty creates a fertile ground for previously outlier positions. In Gramscian terms: such important events destabilize otherwise anchored cultural hegemony.

This concept-that of cultural hegemony-is perhaps Gramsci's most important contribution to the field of political science. The idea is the following: power, in all its forms, is rooted in popular consent. In order to successfully establish a specific way of organizing society, you must first get the local population on board. In fact, people need to be so convinced that that specific organization is the way things must be that they should not question its basis.

Rival ideologies should not compete on equal terms. To take the place of the cultural hegemon, they need first to contest its de facto legitimacy, and then successfully claim its place in the hearts and minds of the people.

In Gramscian literature, this struggle will take place as communism inevitably takes the place of global capitalism. This remains to be seen, but while we're waiting this theory can be applied to smaller instances of ideological shifts. Brazil is living just that.

In order to demonstrate this, let us first take a quick detour by Brazilian political history.

Until 1985, the country was ruled by a military dictatorship, which relied on brutal repression to get its way.

Things changed during the '80s, an active period when it comes to democratization worldwide. Some political scientists-Samuel Huntington in particular-have gone so far as to call that phase the "third-wave of democracy." Along with other South American countries, Brazil saw its military regime come to an end, and hosted its first democratic elections in over two decades.

Since the 1985 election, at least three tendencies have become abundantly clear.

First, the country has had a history of inflationary problems. If we consider the rate of inflation over the last three decades, we see two peaks. The first, in 1990, reached an astonishing 6,800%. The second, in 1994, culminated at 5,000% in June of that year. But even if we disregard these extreme cases, Brazil has had far from a stable economy throughout the end of the twentieth century. For instance, the average inflation in 1987 was 363% and in 1992 it was 1,119%.

The second clear tendency is that when Brazilians are unhappy with a governing party, they let it know with their ballots. The third is that they rarely offer a second chance: the results of the three presidential elections following the fall of the military regime led three different parties in office.

First, in 1985, Tancredo Neves of the Brazilian Democratic Movement Party (BDMP) was elected. Though, in a Hollywood-worthy turn of events he collapsed just before gaining office and died shortly after, his running mate and vice president, José Sarney, assumed the role of president.

Four years later, with inflation bordering 2,000%, Fernando Collar de Mello's Christian Labour Party (NRP) was elected with 53% in the second round. The BDMP only managed to secure 11.5%.

The following elections took place in 1994, just after the second inflationary peak. Once again, this economic fiasco led to the ruling party's political demise. The NRP secured an astounding 0.6% of the popular will, while the BDMP came fourth with 4.6%. The Brazilian people where still looking for their party: a whopping 95% of the population was not satisfied with what they had seen since the fall of the military regime a decade prior.

This time, Fernando Henrique Cardoso's Brazilian Social Democracy Party (PSDB) was elected in the first round with over 54% of the ballots: a landslide victory considering that the runner-up was Lula's PT with 27%. It is important to note here that this was the most left-leaning government elected since the end of the military regime. While all other parties had been right-of-center, Cardoso ran and governed in a clearly social-democratic manner.

FHC fought inflation tooth-and-nail (successfully-bringing it from an average of 3,000% in 1994 to 7% in 1997 by pegging the reais to the American dollar), opened the Brazilian economy to foreign investments (FDIs augmented threefold between 1995 and 2000), and privatized some industries in order to fund social projects. FHC is credited with creating social security and generalizing taxation in Brazil.

The Brazilian population responded positively to this newfound stability. A constitutional amendment was passed to allow Cardoso to run for a second term. In 1998, he was re-elected with a majority of 53.1% in the first round. During his four years in office, he had lost only one percentage point of support. He went from winning 25 out of 26 states, to 23. The surprising stability of the results of his two presidential campaigns shows how faithful his electoral base was. This popularity was not unconditional however. During his second term, the hens came back to roost: his desire to please both workers and capital created an influx in public debt.

During his 8 years as president, federal as well as state and municipal debt increased more than twofold. In an effort to save the national economy from an exponential debt crisis, and a freefalling export sector due to economic collapses around the world (Asia and Russia were seeing their economies crumble), he took a number of neoliberal measures. He liberated the reais from its US dollar parity, accepted a structural adjustment program from the IMF, and undertook a structural reforms of the economy in which privatization and austerity held a key role. The results where what one would expect: GDP per capita plunged, the value of the reais was cut in half, and capital flew out of the country at high rates.

Following the footsteps of recent history, the government swapped hands in 2002, when Luiz Inácio Lula da Silva, who was running his fourth campaign for the Workers Party (PT), won two thirds of the votes against the PSDB candidate. This was the beginning of an era for Brazil, one that we haven't seen the end of-yet.

The PT was the most left-wing government since the fall of the military regime. Under Lula's presidency, real social programs were put in place, yielding real results. To name only a few, the 2003 Fome Zero program aimed at eradicating extreme poverty in the country, the Bolsa Família and Bolsa Escola programs provided impoverished working class Brazilians with an allowance if their children were vaccinated and attended school, and the Progama de Aceleraçāo do Crescimento (PAC) had a multibillion reais budget to invest in infrastructure.

Make no mistake: Lula's presidency was not that of a socialist. In fact, the left wing of the PT was so disappointed with his lack of defiance towards capital that they split to form a separate party called the Socialism and Liberty Party (PSOL). But Lula did provide working class families with a net increase in their material condition. During his two terms in office, the gini coefficient of country (measuring wealth inequality) fell continuously, the GDP per capita increased substantially, as did the GNI. 98% of people born after 1990 now have at least a secondary education, compared to 70% for those born in 1970.

It was with this kind of mindset that Lula was re-elected in 2006, winning close to 50% in the first round, and then by a more than 20 percentage point margin in the runoff. Constitutionally barred from a third presidency, his protégé Dilma Rousseff ran in 2010, and won by an over 10 percentage point margin. Running again in 2014, she got re-elected-albeit not with as impressive result as previously.

This brief recap of Brazilian political history demonstrates two things:

First, the kind of legitimacy that has been enjoyed by the PT is a one-of-a-kind instance since the fall of the military regime. However, the second lesson is that this support is quite logical. Lula and Dilma have provided the working class with what it has been asking for since 1985: a stable democracy, and material returns for the working class.

From a Gramscian perspective, this legitimacy is rooted in cultural hegemony. Indeed, PT rule and the political scene since Lula's arrival in power have been causally linked in popular conscience. This means that any opposing ideology has an uphill battle before it: that of discrediting PT's social democracy.

As of now, the PT has won four consecutive presidential elections in Brazil; half of all those that have taken place since the end of the military regime. For a time, Lula's party looked like it was the country's natural party, as if the PT and the Brazilian people had some sort of indivisible bond. So how did we arrive to the place where we are now?

According to Gramsci, cultural hegemony is essential for the ruling class. The PT has undoubtedly acquired something of that nature. It has offered Brazil social democracy. It promised a capitalistic system with real returns for the people, and, to some extent, has delivered. The material condition of a large amount of people increased impressively during the Lula era and, to a lesser extent, during Dilma's early days. But if there is one thing capitalism has shown, it is that these kinds of honeymoon periods are always finite, and at some point the economy contracts over its own weight.

The party's cultural hegemony rested on two things: a booming economy, and social democratic policies. Both fell apart in the last two years. First, the country's rise to economic prosperity came to a halt. The economy that the PT had created was highly dependant on exports to countries like China or the US. With these countries' economies contracting, the model ceased to work. Brazil's GDP growth was divided by two between 2011 and 2012. The reais has plummeted in face of the US dollar since 2011.

Between mid-August 2014 and today the Petrobras stock, Brazil's largest company worth about 10% of the country's GDP has fell from $23.35 to $8.44. Brazil, in other terms, is facing the harsh realities of capitalism.

This left Dilma with two options: either take a left-wing approach and handle the crisis by stimulating demand, nationalizing big industries, and reforming the tax code to take money where it is, or, take the right-wing path.

She chose the latter.

2015 was the year of austerity in Brazil. Budget cuts, backpedalling on investment programs, cuts to social security… the Rousseff government fell to right-wing pressure and implemented capital-friendly policies. This came after she had won the elections one-year prior with a left wing discourse. This shift in position was one of many blows to the PT's cultural hegemony. By disavowing her party's traditional positions, Dilma legitimized dissident opinions. It is thus unsurprising that the lion's share of her critics, Temer included, come from her political right.

Indeed, now that Dilma is, at least temporarily, out of office, the interim government has already called for widespread neoliberal policies, which include cuts in public spending, decreases in welfare, and cutting jobs from the federal government.

The Rousseff government has dug its own grave by coming back on settled questions. The president and her administration have broken the ideological continuity of the PT rule, which in turn destabilized the foundation of their authority. She opened a door to her right, which allowed contestation. With the hegemonic left-wing personalities turning to neoliberalism, nothing was keeping public opinion from going in that direction.

The demographic participating in the ongoing protests further proves this. One image speaks volumes about the kind of people fuelling these events. A visible rich, white couple is seen marching alongside a baby carriage pushed by a black nanny. This photo sparked mass criticism in Brazil-a country where the racial and wealth divide is still very much a reality. Some have even reported protesters drinking champagne at anti-PT events. This segment of the Brazilian population is the one represented in Temer's provisional government. Clearly, what is being witnessed is not an uproar from impoverished favela youths, but rather a movement that is largely dominated by white, upper-middle-class individuals, whose right-wing bias has been gaining traction through legitimization.

Worst of all, a specter is haunting Brazil-the specter of inflation. Granted, we are far from the four digit numbers that plagued the country in the late '80s and mid '90s. But nonetheless, since 2014, inflation has almost double from about 5.5% to 10.5%-well above the average of 4% that the country had become accustomed to during Lula's time. In fact, 2015 was the year with the highest rate of inflation since the country has been under PT rule. This has sparked some concern amongst the general population, who fear the return of hyperinflationary pressure.

The point is the following: The PT had acquired a cultural hegemony, which mechanically provided it with popular legitimacy. The schematic being used, however, was based on a capitalistic logic of economics, which is fragile and ultimately unsustainable. When the inevitable turmoil arrived, the PT could have taken measures to ensure that material benefits from the working class were not withdrawn, but decided to dive into neoliberal reforms instead. By backpedalling away from their own logic, which was the backbone of their cultural hegemony, the PT delegitimized their position, providing a fertile ground for ideological debate. This is why the right-wing media and corruption scandals are gaining traction today, even though they have always been around.

This leaves Brazil in quite an awkward situation. The population is disillusioned by the Left and is turning to the Right in order to solve their problems. Presumably, this is a bad idea. But not all hope is lost. The possibility of having a new Left rise from the old one's ashes is still possible. For that, however, there would need to be a conscious effort to establish a new cultural hegemony.

Jacques Simon is a French national, currently studying politics at the University of Ottawa in Canada. His interests include political economy, comparative politics, and the study of radical politics.

The Bosses' Utopia: Dystopia and the American Company Town

By Nick Partyka

This is the second part of a multi-part series. Read Part One here.

On The Value of Utopia

For many centuries persons, peoples, and civilizations, have dreamed about what an ideal society (utopia) would look like, and worried about ways in which society could be much worse (dystopia). Utopian dreams and dystopian worries are powerful tools for thinking about what sorts of changes a society should pursue or avoid, and what underlying dynamics these proposed changes expose. This series examines the tradition of utopian and dystopian thought in western culture, beginning with the ancient Greeks, but continuing on into the modern period. Our focus in this series will be on the important social, political, and economic ideas and issues raised in different utopian stories. When we look into utopian stories, and their historical times, what we'll see reflected in the stories of utopia are the social, political, and economic concerns of the authors, their societies, and or their particular social class.

The meaning of the word 'utopia' comes to us from ancient Greece. In our modern world the word takes its current form because of Thomas More's 1516 book of the same name. Indeed, it is this book from which most of the modern western European utopian tradition takes its origin; or at least, this work inaugurates its most common trope. Where we have in our lexicon one 'utopia', the Greeks had two. The difference, even confusion, between them marks an essential cleavage. For the Greeks, there was both Eu- topia, and Ou-topia. Both are derived in part from the Greek word topos, which means "place", and the suffix 'ia' meaning land. Translated into English, 'Ou-topia' means something like, " No-place land", whereas 'Eu-topia' translates as "good-place land". More succinctly, the difference is between the idea of the best place, and an impossible place. It is the difference between a place which does not exist, because it has not yet been realized, and a place which cannot, and could not, ever exist.

Our modern word is pronounced as the Greeks pronounced 'Eutopia'. However, the meanings of these Greek words were confused by modern writers, who ended up with the spelling 'utopia', from the old English 'Utopie' as opposed to "Eutopia", as meaning "good place". This basic confusion about utopias, between "good place" and "no place", inserts an important ambiguity directly in the center of thinking about utopias. This ambiguity forces one to wonder of utopian writers, Are their visions supposed to be dreams of possible futures meant to incite us to action, or are they impossible dreams meant as reminders that the world is not easily re-shaped by human effort? Is a utopia supposed to be a good place or a no-place, Is the author supporting or condemning the practices of the fictional societies they describe?

One qualification must be made right away. A utopia is not a paradise. There is a colloquial usage of 'utopia' and 'utopian' that seem to suggest that it is a paradise. And compared to the societies in which actual humans lives, many of the fictional utopias would have indeed been seen as paradises, relatively speaking. However, we must draw a technical distinction between a paradise or a golden-age, and a utopia. In a paradise or golden-age no work and no effort are required by humans to obtain the things they want and need. Perhaps the most famous golden-age many are familiar with would be the Biblical Garden of Eden. Another well-known paradise is described in the mid-14th century poem The Land of Cockaigne, where fully cooked turkey legs literally fly through the air and into one's mouth. In this place the only effort on need put in is to chew.

The whole idea of a Cockaigne, or a paradise, is that everything one would ever need is abundantly supplied without any effort. The natural world is just so constructed - either at random or by design - that there springs forth automatically an abundance of everything necessary for everyone, all the time, always. In this kind of society, or world, there never arises anything resembling what we - or most societies in the history of our world - recognize as a political problem. Everyone has enough of everything. So there is no cause for argument. There is no inequality, because everyone has everything everyone else has. Or at least, everyone has access to just as much of what others have whenever they would like it. In this kind of world what causes could there be for strife, or for civil war? A paradise, or a golden-age, is thus totally non-political, and as such not terribly interesting.

What this means is that utopias are enough like our own condition, our own world, that we can take inspiration from them. They are enough like the social conditions we know that we can learn lessons for and about ourselves and our societies by examining at them. This is exactly what makes utopias so interesting. As we will see, utopian literature has a long, very long, history with human beings. The enduring appeal of and, interest in utopias testifies to their relevance. This is the reason that we too are looking at utopias. We are all concerned with, or at least we are all effected by, the way our society is organized. By looking at how other ideal societies might be organized we can explore the merits, and demerits of various kinds of social institutions, and of the various ways of structuring those institutions. We are concerned to change our own society, and utopias allow us to think about the direction of that change.

We have a colloquial usage of the word 'utopia' and 'utopian' in contemporary society that works to prohibit much creative thought, and dismisses utopian thought as feckless, and as such, worthless. Part of the aims of this series is to demonstrate the value of this "worthless" endeavor. Dreaming, far from idle, far from impotent, is essential. Without wonder, without questions, the human imagination will atrophy. The value of this is that thinking about utopias allows us to both critique present societies, but also to articulate a vision of how we'd like our societies to be different. The deeper value of utopian thinking is that it sets us free, free to speculate and more importantly to give expression to our striving, to our desire for a better world. Everything human beings can be must first be dreamed by human beings. This is the value of utopia and dystopia. Thus, the first pre-requisite for this series is the rejection of this colloquial notion of utopia and the utopian. Dismissed from the start, it will not be a surprise if we fail to learn anything from our utopian traditions.

Introduction

In another part of this series I discussed the American tradition of radical utopianism. Owenites, Fourierists, as well as various and sundry religious sects, all attempted experiments in communal living inspired by utopian political or spiritual ideologies. By removing themselves from the world, these groups sought to re-make society in miniature, as an example that could be replicated throughout the country as an alternative to the ascendant bourgeois society. American history also contains a dystopian tradition. Some individuals who came under the sway of certain utopian idea also happened to have large amounts of money, and or were proprietors of large business concerns. Several very wealthy businessmen cum would-be philanthropists embarked on many now forgotten utopian experiments. In some ways their schemes resemble Owen's original New Lanark project, in that a firm's profit-motive was used to argue for less abusive working conditions for workers. I am talking, of course, about the company town.[1] A term now, and for good reason, loaded with connotations of anti-democratic forms of dependence and surveillance, a modern industrial feudalism, that galled observers and greatly angered many worker-residents.

At many points in American history wealthy capitalists saw it as beneficial to construct planned communities for their workers. These ran the gamut from unsanitary ramshackle slums and ghettoes with little planning or services, to highly elaborate planned communities designed according to the proprietors' ideology of choice, in which even small details were prescribed and regimented. In some of these capitalist-inspired utopian experiments, designed to 'elevate' workers, one can see clear examples of many dystopian themes manifested in real-life. Looking at the experience of company towns one readily discerns significant dystopian elements, e.g. some rather reminiscent of George Orwell's now famous Big Brother. The high-handed, obtrusive, and moralistic scrutiny of private life; the regimentation of work and social life; the uniformity of living standards; strictly imposed and enforced moral codes, are all dystopian elements one can find in the work of the most well-known dystopian writers, e.g. Orwell, Huxley, and Zamyatin.

The United States has had a unique experience with company towns, quite different from the experience of European countries. America saw both a greater number of company towns, as well as greater diversity among them. The uniqueness of the American experience has to do mainly with the size of America and the prominence of the frontier, and the small-government sensibilities of the founding generation. That the country was expanding geographically, and that the government was typically disposed to take a laissez-faire stance on interference with the private undertakings of businessmen and entrepreneurs. These factors combined to allow private sector actors wide latitude in their ability to construct ideal communities, that is, communities that were ideal for the bosses in that they served the bosses' interests more than those of workers. This freedom for the private sector has sometimes resulted in neo-feudal conditions, e.g. like those that were found in many Appalachian coal towns, and other times in the more bucolic and rural utopian project of magnates like Milton Hershey.

In the Beginning There Was Lowell

The Pilgrims who came to North America had designs to create a 'city on a hill', a symbol to all the world of how to live justly and righteously. There is a certain obvious utopian aspect to this view. The chartered basis of these colonies, and their need to make a profit gave them some of the shades of the company town. They remained for many years trapped in a cycle of debt, always needing to consume more in supplies to sustain themselves than the value of their exports would purchase. This is one reason that the early colonists pursued whaling, as well as fur trading and trapping right from the start. Beaver pelts in particular were extremely lucrative, and it was the expressed intention of many colonial leaders to use export of pelts to pay for not only the debts incurred for the initial transportation to the American continent, but also the provision, supplies, and other goods the colonists would eventually want and need to import.

A famed British historian writes, "Whoever says Industrial Revolution says cotton".[2] Thus, we should not be surprised to see cotton, the company town, and utopianism come together in the early phase of American industrialization. As such, one must look first to Lowell, Massachusetts where its eponymous founder Francis Cabot Lowell established one of America's first water-mill operations, as well as one its first well-known company towns. Indeed, the town, famous for its past, continues to drawn large numbers of tourists year after year.

Francis certainly had some utopian ideas behind his designs in business, and community building plans. A wealthy Boston merchant, Lowell, toured England in 1811 where he saw first-hand the conditions in the mill-towns of industrializing Britain. What he saw there, especially in places like Manchester, shocked him, as it would many others including Friedrich Engels. The poverty, degradation, squalor, misery, disease, and "moral corruption", which was perceived to run rampant in the new large urban industrial city, disturbed Lowell. Those few capitalists who did have qualms about industrialization, and the rise of industrial society, tried to find ways to achieve the social benefits of industrialization, but to avoid the crushing desperation of life in industrial cities like Manchester. This is the inspiration for Robert Owen's brand of utopian socialism. His New Lanark mill-town was a model of reform, and saw the material improvement of workers and their living conditions as the basis of the transformation of society. It is in this same spirit that Francis Cabot Lowell conceived his American mill-town. Lowell sought to create the opposite of what he saw in Manchester, a bright, healthy and virtuous community. Yet, he also certainly sought the immense profits to be made in the textile industry. He certainly had no intention of operating his business at a loss. Owen, for instance, while certainly a prosperous businessman, had a moral and ideological mission, which balanced his quest for profits, and New Lanark was profitable.

Lowell imagined his mill-town as an intellectually and morally uplifting community, which would fit into the needs of American society at large, and in this way help form the economic basis of an American capitalist utopia. His community would help create that 'city on a hill' so many different groups had hoped to turn America into. Lowell's plan was to recruit his workforce from the younger women living and working on the farms in the area. These young New England ladies would come to work seasonally in Lowell, not become full-time proletarian toilers. In order to attract these workers Lowell advertised the intellectually stimulating, culturally vibrant, and moral upright way of life that characterized the community. He wanted these young women, and especially their parents, to think of their time in Lowell as a kind of preparation for adult life and for marriage. Francis was always keen to point out in his pitch that his lady workers had access to such essential icons of "middle class" life as books and pianos. He also highlighted the presence of older women who acted as supervisors of the boardinghouses where these young women were housed, and who enforced a strict 10pm curfew. Between studying music, or literature and poetry, attending free lectures or other amusements, life in Lowell was supposed by Lowell himself to be as good for the workers, their families, and even the country, as it was profitable for himself and his business partners.

The reality of the life of the town, and the experience of the people who resided in it, differed in several large respects from Cabot Lowell's intentions. Some aspects of the life of the community at Lowell we will see re-appear in company-towns throughout American history. The most important of these is despotism, in one or another of its many forms. The control wielded over the life of the town, and thus over the residents, by the company's owners would work to foster several dystopian and despotic elements in Lowell, as well as in later company towns. The company regimented the rhythms of life in town, fitting it to the needs of the production process, and it announced the progression of each day's routine through the sounding of bells. Workers were woken at 4:30am, and required to be to work by 4:50am. The working day ended at 7pm, and there was a 10pm curfew in town. The bells marked the transition from each part of the day to the next, when to get up, when to work, when to eat, when to rest. This regime was no doubt onerous to many. Lowell's vision of where his workforce would come from soon crumbled, as he failed to attract as many young New England ladies as he hoped. Thus, very soon Lowell and his partners had predominantly immigrant workforce in their town.

On the job, workers were subject to the personal discipline of the foreman. This was usually entirely arbitrary, and workers lacked any recourse against such depredations. Off the job, workers were subject to the scrutiny and censure of a system of "moral police" operating in the town. The older women boardinghouse-keepers were some of the main agents in this network of spies and informants, of which other workers might well also be a part. The company, i.e. its officials, could fine or fire any workers for immoral conduct, like consuming alcohol. Any employee that failed to fulfill their contractual one year of service, because they quit without the contractually mandated two weeks' notice or were not "honorably discharged", would be blacklisted from employment in the area. Workers were required to attend church services, and to pay a mandatory fee to support this church. They also had to pay a fee to stay in the boardinghouses, which apparently not lacking in food, were over-crowded, poorly ventilated, and lacking entirely in privacy. Workers came to live and work at Lowell despite these kinds of conditions because the pay was too good to pass up.

A striking vision of the lives of the women who toiled in the factories like these in antebellum America can be found in a lesser-known work by famed American author Herman Melville. In his short-story, The Paradise of the Bachelors & the Tartarus of the Maids, Melville paints a vivid picture of the drudgery of the actual work of producing cotton textiles in these early factories.[3] Though the workers in his story are making paper and not textiles, the main outlines of the workers' experience would have been much the same. Melville describes the entrance to his fictional, yet all too real, mill in the most daunting imagery, invoking the idea of "Dantean gate" one must pass through. In describing the operations, and workers of this mill Melville uses language that evokes the toil, degradation, over-bearing foremen, the sexism, being beholden to the whims and demands of the company on whom one depends. Melville is just one rather famous example of a common view at this time, that factory work, wage work, was a kind of slavery. At a time of rising sentiment of opposition to slavery, this was a potent objection to capitalism, and to the plans of capitalists, that it was slavery by another means, and not acceptable treatment for white people. This sentiment was also part of the inspiration for two strikes in Lowell in 1834 and 1836 largely in response to wage cuts announced by the company in reaction to falling prices for textile goods.

Utopian Paternalism

Francis Cabot Lowell was not to be the last American capitalist to dream of creating a model community where the vices and sins of the rapidly modernizing world would be excluded, and a more idyllic life re-created. First and foremost of these new modern ills, in the minds of capitalist utopian visionaries like George Pullman, Milton Hershey, and Henry Ford, among others, was labor strife, that is, labor unions. Thus, one of the main foci of the efforts of capitalist utopian was preventing workers from organizing and bargaining collectively. What we will see in each of the examples mentioned above is that these attempts at creating a more ideal kind of life within modernizing, and industrializing American society share certain dystopian elements. The most apt way to characterize the main themes of these capitalist - led efforts at building and operating planned communities is as utopian paternalism. Capitalists like Pullman and Ford certainly saw themselves as advancing the workers' own good, even when those workers' views about their own good were to the contrary. These men thought they knew better than workers what was in their best interests. Unsurprisingly, none of these utopian experiments was successful from the point of view of their founders, since they all failed to prevent the rise of labor unions.

In 1880 George Pullman, maker of the famous Pullman Palace Car, the ubiquitous sleeping car which made transcontinental rail travel more comfortable, began to construct an ideal community on the outskirts of Chicago.[4] The town of Pullman would feature several lavish public buildings, including a library and theater. The residences were supposed to be more commodious, most were connected to natural gas and running water, some even featured bathrooms. There was a wide array of shops housed in public buildings to accommodate the needs of the town's residents. Much effort was made to create a pleasant aesthetic in the town, from the design of the buildings to the layout of the community. Pullman desired to re-create a more bucolic atmosphere to contrast with the grit and grime of the cities. Pullman, based on a firm profit motive, believed that treating workers better would make them more loyal, harder working, and less likely to want to join a labor union. His model community would not only save money by locating workers near their place of work, but also would help to forge a new kind of worker. This new worker would be more dependable, more docile, more compliant, et cetera. This change would of course be more conducive to capitalists' accumulation of wealth.

One thing every building in Pullman had in common, from the work buildings, to the residential buildings, was that they were all owned by the Pullman company. Workers were compelled to be renters, and not permitted to own their homes. The rent payments for which were deducted automatically from workers' paychecks. Not just workers, but also all community organizations, were prohibited from owning buildings, and anyone could be evicted with a mere ten days warning. Moreover, what came to pass for a municipal government in the town of Pullman was completely under the control of the Pullman company. The foundations of community life were only further eroded by the use of "inspectors' by the Pullman company in its town, whose job it was to report on the workers, their activities, affiliations, and opinions. These inspectors were to report any resident who was found to have undesirable or immoral views, attitudes, or habits. The atmosphere of the town of Pullman was best described as a kind of, "benevolent, well-wishing feudalism" with George Pullman as its king.[5] Discontent with conditions in the town of Pullman contributed to the desire of workers to unionize, and helped spark the famous 1894 strike of the Pullman company by the American Railway Union led by Eugene V. Debs. [6]

Inspired to some extent by the example of Pullman, the man and the town, in 1903 Milton Hershey began work on his own planned industrial community. [7] His was to be modeled to a degree after the Mennonite villages familiar in the area of Pennsylvania Hershey chose. The area had one key virtue for him, lots of dairy farms nearby to provide the critical ingredient he needed for his chocolate, i.e. milk. Like Pullman, and others, Hershey was a critic of the growing urban society. The urban environment was seen as morally corrupting and physically unhealthy for the people who lived in them. Thus, Milton thought that by re-creating a more pastoral, healthier kind of life workers lives would be improved. What could also be improved was his profits, by reducing labor agitation. In the same profit-first motive of Pullman and Lowell, Hershey thought that contented works would be more productive, more loyal, workers. In a further echo of the Amish who lived in the area, Hershey envisioned a prosperous community full of clean-living residents. Even more than Pullman, Hershey invested in public buildings in his town, including the now famous Hershey Industrial School which housed and educated orphaned boys. His eponymous town would in this way, and others, serve as a living advertisement for his product, the wholesomeness of the one reinforcing that of the other.

The town of Hershey would also experience many dystopian elements, despite it is founders' intentions, though perhaps less intensely than in Pullman. In contrast to Pullman and Lowell, the high-handed moral despotism in Hershey would be doled out by the proprietor himself. In the town of Hershey, Milton was the moral police; he was also the mayor, chief of police, and fire chief, as there were no elected officials. The comfortable life available to worker-residents of Hershey came as part of a trade-off in which one sacrificed democracy. In exchange for having no control over their community, worker-residents received several benefits, medical coverage and a retirement plan; free garbage pick-up and snow removal; public buildings like churches and schools, including a junior college with free tuition for workers; and, despite having all this, there were no local taxes.

In many ways Hershey's plans came to fruition, and the town enjoyed a fairly harmonious existence for many years. Indeed, it was not long before the town achieved notoriety as a tourist attraction, both the chocolate factory as well as the "Hershey Park" amusement park. The modern world caught up to Hershey eventually, leaving a large black mark on the town's reputation. In 1937 labor violence in the town made all the wrong kind of headlines. Local dairy farmers dependent on selling to the Hershey factory brawled with striking workers. Outnumbered four to one, the strikers were badly beaten and chased away from company grounds by the mob of dairy farmers.

Henry Ford also fancied himself a philanthropic businessman, someone who could help educate workers and elevate their lives. His famous $5 a day plan was built on the same kind of hard-headed, profit-oriented logic we've seen in both Pullman and Hershey, as well as the capitalist utopian visions of the moral improvement of workers. And just like both of these others, Ford's generosity came at price. There was a rather dark side to Ford's desire to improve the lives of his largely immigrant workers. In exchange for a higher wage, workers had to pledge to live wholesome lives, that is, conduct themselves both on and off the job according to Ford's moral precepts. Just as we saw with Lowell, higher than average wages attracted an enormous glut of applicants. Workers came and they stayed, despite the brutish tactics of Ford's anti-union henchmen in the Service Department and the condescending racism of Ford's Sociological Department, because of the higher pay and benefits offered.[8]

The infamous Service Department at Ford was headed by Harry Bennett, a vicious enforcer whose egregious abuses of workers remained mostly secret from the public. He used fear, intimidation, and a paramilitary gang to pressure workers into doing as they were told. The main job of this secret police force was to prevent and disrupt and potential union organizing activity by Ford workers, by any means necessary. Surveillance and beatings were to main tactics Bennett and his thugs applied to suspected union activists. Bennett also constructed a huge network of spies within the company, so that potential agitators never knew if they were talking to one of his informers. Ford's Sociological Department was responsible for turning his immigrant workers into "real" Americans. In a racist and very insensitive way, workers were to be stripped of their foreign customs and beliefs, and then re-made to be as American as apple pie. Employment was conditional on workers learning English and American civics at company provided classes. Intentionally symbolically, the highly choreographed graduation ceremony for the Ford school began with workers in their native dress, and ended with them in American-style clothes. After graduating workers were supposed to have gotten rid of their old ways, and completely adopted American ideals and values.

Ford's Sociological Department was also responsible for a highly intrusive regime of surveillance of workers and their personal lives. Members of the Sociological Department interviewed workers, and their family members, often several times, asking extremely invasive questions about many different aspects of workers' lives. Though billed as a project aimed at social reform, the operatives of this department collected massive amounts of information about Ford employees and their families. How many times they were married, how much debt they had, how much money they remitted to relatives, and whether they had bank accounts, were all questions Sociological Department agents asked workers. These interviews were not one-off affairs. Two, three, even four, interviews would not have been uncommon, and this applies to the workers' family members as well. Workers were lectured by these company-men to maintain a certain standard of cleanliness and order at home. Naturally they were heavily discouraged from the vices of drinking, smoking, and gambling.

Industrial Feudalism

The darkest side of the American experience with the company town can be found in the example of coal and steel towns, as well as oil boom-towns. Hardy Green concisely describes this variety of the company town as, "exploitationville".[9] This title is largely self-explanatory. This is because the image of the coal town, especially the Appalachian coal town, has remained such a vivid part of America's popular consciousness. The reign of the company, its officials and its store, is legendary for its ruthlessness, brutality, arbitrary punishment, and oppression through debt. The famous song "Sixteen Tons" by Tennessee Ernie Ford affixes in the popular imagination the tyranny of the company in the coal town; the drudgery of the work; the inadequate pay; company theft of that pay; reliance on debt, and corresponding servitude to it, as well as the despair and despondency this way of life created. Often times these 'towns' were little more than camps or agglomerations of shacks, shanties, and hovels. There were often few or no public services, and when they did exist workers were usually forced to pay exorbitant prices for the most basic services, e.g. garbage collection and sanitation infrastructure.

Like other company towns, workers in coal towns were not allowed to own property, and thus forced to rent from the company at the prices it set. Workers were often paid in 'scrip', a form of local money only good at the company store. They were thus dependent on the company for everything they needed. As one might expect, workers were routinely bilked of their hard-earned wages by their unscrupulous employers through inflated prices for staple goods, as well as taxes and fees for basic services. Like in other company towns, there were usually no elected officials, and all law enforcement was overseen by the company. The 1871 Coal Creek War in Tennessee is a prominent example of the kind of reaction workers had to the many ways their employers dominated, oppressed, and robbed them. It is also a characteristic example of how employers in many different sectors dealt with organized labor in similar ways. Nor were such practices limited to the coal mining industry. Mining communities all over the country endured conditions, to one degree or another like those of the coal towns, from the omnipresent surveillance and spies, to the tyrannical foremen and threats of violence.

In many cases steel towns were not much better, though the housing might be better than the notoriously poor housing afforded workers in mining towns, particularly the coal towns. Gary, Indiana, and Homestead, Pennsylvania are two prominent examples of company towns in the steel industry. Both projects were motivated by the same utopian capitalist logic about making workers materially better off enough to reject union membership. The broad outlines of the story in both communities are familiar: inadequate, unsanitary, and or over-crowded housing; housing allocated by status; housing dependent upon employment; over-priced rents automatically deducted from wages; abusive foremen acting with impunity; workers forced to sing "yellow dog" contracts promising not to join a union as a condition of employment; no independent stores; workers paid in company 'scrip'; over-bearing moral codes imposed on workers by "moral police". Conditions at Homestead, in addition to issues like wages and hours, were one of the most significant factors in sparking the infamously bloody strike in 1892. Labor strife would come to Gary in a big way in 1919. Workers striking for improves wages, and reduced hours, were certainly also very upset about the living conditions in town. In both cases, the owners, with help from the state, used violence to disperse the workers and repress their demands and their organizations.

American Dystopias

It should be clear, after a look at the historical experience of company towns in America, that, in many, if not most, instances this experience contains many distinctly dystopian elements. Indeed, the experience of workers in company towns across America forms a unique American dystopian tradition, which contrasts sharply with its robust utopian tradition. When we look to the works of some of the great dystopian writers, we will notice the same themes that we saw in the real-life, historical experience of American company towns. George Orwell, Aldous Huxley, and Evgeny Zamyatin, all present visions of future dystopian societies which embody - in some cases to a fantastic extreme- the abusive treatment and horrible living conditions that characterized the life of many American company towns.

All three dystopian authors depict future societies in which an authoritarian government, composed of an elite minority, rules despotically over the rest of the population. Moreover, in all three, the activities of the dominated population are structured in a way that furthers the social, economic, and political aims of the ruling elite. All three of these dystopian societies make use of some particular combination of omnipresent surveillance, brutal and violent repression and torture, or some form of psychological conditioning to compel the population into compliance with the government's policies. The people of these dystopian societies are led, or forced, to believe that the current order of things is actually for everyone's benefit; though clearly some benefit more than others. All three are portrayed by their leaders as peaceful and harmonious societies, despite the fact that violence and repression, of one kind or another, are needed to maintain order in society.[10]

Whether Orwell's Big Brother in Oceania, Huxley's Alphas in the future London, or The Benefactor in Zamyatin's the One State, features from all three of these dystopian societies find analogs in American company towns: a single-minded and ideologically motivated founder or leader; the enforced dependence of the population on the state, that is the elite minority who run it; the abusive treatment of the population by the officials of the state; an unrelenting and intrusive propaganda offensive against the enemies of the state; monopoly on the press, and censorship of rivals as a form of persecution; universal surveillance of the population by the ruling elite, including an extensive network of spies and informers; unhealthy and degrading living conditions for the majority of the population, but opulence for the elite; systematic theft from, or exploitation of, the population to meet the needs of the ruling elite; thoroughly rational, totally invasive, and frustratingly stultifying regimentation of life both on and off the job.

Conclusion

The company towns in America all seem to share one thing in common, a pattern of boom and bust. This might be separated by decades, but all company towns seem to share a common fate. Namely, when the business dries up, or the industry collapses, the town dies. Sometimes the death is quick, other times long, drawn-out, and painful. The oil or gold boom-towns would be on one extreme, as they could disappear entirely over-night, and re-established at the next site in rapid order. Closer to the other end of the spectrum, company towns collapse because the industry changed or relocated, e.g. Lowell or Pullman. Other company towns collapse because their reason for existing disappears, e.g. the coal seam, or silver vein is tapped out. Sometimes company towns survive the collapse of the firms that dominate them, but as mere ghosts of their former selves, e.g. Gary. Only a very small successful few remain in operation, like Hershey. It is in light of this history of the company town in America that one should see the collapse of Detroit. One industry so dominated employment in that city, that as it fortunes flagged, so too did those of the city. Just as the industry declined, and resorted to new methods to remain competitive and continue to generate the profits shareholders expect, indeed demand, so too did Detroit decline. And, as a result, the city was forced to resort to measures that accelerated the city's decline by encouraging disinvestment, diminishing public services, and eroding quality of life.

To many Americans, fascism, as represented in regimes like Nazi Germany or Mussolini's Italy, is the ultimate real-life dystopia. Many Americans also think that this is a foreign problem, something embedded in the cultural DNA of the Old World. Many think of this kind of ideology is not, and cannot be, indigenously American. Hence the extreme xenophobia that arose during both world wars, and the antipathy many Americans felt towards the early labor movement. Yet, the historical experience of the company town in America demonstrates that these conceptions are quite misleading. When given freest reign, capitalists, have created social environments that resemble quite closely the kinds of literary dystopias that most haunt our imagination. Fascism, in fact, has an American pedigree in the legacy of the company town. The legacy of the company town also quite nicely illustrates that fascism is not only bigoted hate-groups waving swastika flags. It also comes in more patriotic, more benevolent and well-meaning forms, like the kind of utopian paternalism that was evident in most company towns. It can also be seen, naked and direct, in the violent and authoritarian regimes that dominated some company towns, especially those associated with the mining industry.

Notes

[1] For an interesting history of the company town, see; Green, Hardy. The Company Town: The Industrial Edens and Satanic Mills that Shaped the American Economy. Basic Books, 2010.

[2] Hobsbawn, Eric. Industry & Empire. 1968.The New Press, 1999; 34.

[3] Melville, Herman."The Paradise of the Bachelors and the Tartarus of the Maids". 1849. Great Short Works of Herman Melville. Perennial Classics, 2004.

[4] See Green (2004): 27-35.

[5] Richard T. Ely quoted in Green (2004):31.

[6] For an interesting insight into the living conditions in Pullman, and the how they contributed to the 1894 strike see; Ginger, Ray. The Bending Cross. 1947. Haymarket Books, 2007.

[7] See Green (2004): 35-41.

[8] See Grandin, Greg. Fordlandia. Picador, 200: Ch.2 & 4.

[9] Green (2004); Ch.3

[10] See Orwell, George. Nineteen Eighty-Four. 1949.; Huxley, Aldous. Brave New World. 1932; Zamyatin, Evgeny. We. 1924.

Panama Papers: Capitalism Working Well for Obscenely Rich

By John Passant

The Panama Papers show us, once again, that capitalism is a system of absolute greed. It is a system where capitalist governments help their mates to hide their income and wealth while all the time businesses pretend they are paying their "fair share" of tax.

The 11.5 million leaked documents from Mossack Fonseca contain details of the 14,000 clients of the Panama headquartered company and the 220,000 shell companies it has set up for them in tax havens around the globe.

Why tax havens? Not only do these countries have no or low tax rates they also have secrecy provisions which protect the income and assets of wealthy individuals and companies from the prying eyes of state bodies like tax offices and company regulators.

Shell companies mean that the ostensible owners of the companies are often front men and women for the real owners or are companies whose ultimate owners are untraceable. One senior tax officer many years ago summed up tax havens for me when he said they kill the paper trail.

Take Wilson Security here in Australia for example. It runs the "security" on Australia's asylum seeker and refugee gulags, Manus Island and Nauru. It is owned by Wilson Offshore Group Holdings (BVI) Limited, a British Virgin Islands company set up by Mossack Fonseca to protect the true identity of the owners from any governmental scrutiny.

Thomas Kwok, one of those true owners, is in jail for fraud in Hong Kong. The other, his brother Raymond Kwok, was acquitted of similar charges. They had resigned as the directors of Wilson Offshore Group Holdings (BVI) Limited shortly after the charges were laid. Two companies, Winsome Sky and Harmony Core, replaced them as directors. The Panama Papers show the brothers control those two companies.

The reason for these arrangements? Wilson Security would not have won Australian government contracts if it knew that one of the real owners was in jail for fraud.

By the way, Wilson Security also supplies the guards for various government bodies, including the Australian Tax Office (ATO).

It is not just Wilson Security. The ATO is investigating 800 Australian entities named in the leaked documents. The Panama Papers refer for example to Australian banks and BHP Billiton. Banks are involved because you have to get the money out of your jurisdiction and into the tax havens, often via more reputable tax haven countries that supposedly aren't, like Singapore, Hong Kong, Switzerland, The Netherlands or Luxembourg.

Ripples

Iceland's Prime Minister, in the face of big demonstrations, has gone on indefinite leave (resigned) after it was revealed his wife held shares through a shell company in the very banks her husband was negotiating a bail out with. UK Prime Minister David Cameron inherited wealth from his Dad whose Panama shell companies made tax free money for 30 years.

Australia's current Prime Minister Malcolm Turnbull, one of Australia's richest men, has what appear to be high earning investments in or through the Cayman Islands. He used to have an investment in a vulture fund (a hedge fund that buys distressed debt) based in the Cayman Islands. He sold out of that and bought into some hedge funds (unregulated funds that long and short the assets they hold).

The point here is not whether they are legitimate or not or that the investors pay their "correct" amount of tax. It is that they are part of the game the rich and powerful play to increase their individual wealth and that that game is rigged in their favour by governments too afraid to crack down on "legitimate" investments in tax havens.

So the problem is the tax havens is it? Before we get too carried away with colonial outrage, remember that many tax havens exist today as outposts or former outposts of empire set up to hide the money of British colonialists and capital. Some of them, like the British Virgin Islands, the Cayman Islands and Bermuda, are British Overseas Territories, still under some form of British control. At the centre of these tax havens is the City of London, one of the main financial hubs of British, and indeed, global capitalism.

The US has its own equivalent tax havens, in particular Delaware where half of all Wall Street companies are incorporated for the low state taxes and slack company regulation.

So the traditional view of tax havens as sunny places for shady people is actually not correct, unless climate change has turned the City of London into a tropical paradise.

Tax avoidance

These revelations are not new. They are the latest in a range of leaked and other information about the dark underside of capitalism. We have had the Luxembourg leaks, the Tax Justice Network which estimated that between US $21 trillion and $32 trillion is held in havens (about twice US GDP and five times the wealth of Australia all up), the TJN/United Voice report into tax avoidance by Australian companies, and the ATO release recently of tax data of public and private big business companies which shows that well over one third pay no income tax and the majority pay less than the statutory rate of 30 per cent. Apart from a bit of huffing and puffing nothing has happened to address rampant tax avoidance by big business.

Big business tax avoidance gives the lie to the Turnbull mantra that we have to live within our means. This mantra will be the justification for the ongoing cuts to public health and education, to public transport and to social welfare. There would be no budget crisis if we addressed big business tax avoidance. Our mantra in response to Turnbull should be to tax big business and the rich.

Using tax havens and shell companies is part of a wider capitalist dynamic of hiding assets and arrangements from prying tax and other State body eyes. It reflects the business view that any profit is "theirs," rather than the reality that it arises from the unpaid labour of workers.

As Google Chair Eric Schmidt said about his company's tax avoidance activities around the globe, activities which have seen it funnel almost $10 billion into Bermuda, saving $2 billion in taxes:

"The company isn't about to turn down big savings in taxes. It's called capitalism. We are proudly capitalistic. I'm not confused about this."

The problem of tax avoidance is systemic. It requires a systemic solution, a democratic and socialist revolution o put the vast majority in control of the assets of the world and to organise production to satisfy human need, not to make a profit. In such a world we would not need tax havens and shell companies.

In the interim we on the left must continue to argue for taxing the rich and to build all the campaigns against the injustices social and economic that capitalism creates, including the austerity agenda which is about transferring wealth from labour to capital.

We could tax the rich to fund better services. None of the parties of neo-liberalism - the Liberals and Nationals and the Labor Party - are going to really do that. At best they will offer minor changes as part of a smokescreen to give the impression of doing something without actually doing anything major to upset the rich and powerful, the capitalists, whose system drives them to avoid tax and hide their affairs in secrecy jurisdictions.

Now I know none of this tax the rich stuff will in reality get on the agenda willingly of the ALP. The answer is that when the current or future governments attack funding for workers or the poor, attack public schools, public hospitals and public universities, the fightback against those attacks has the potential to challenge the ruling class and its systemic tax avoidance and secrecy. To tax the rich we must build the fight against austerity.

Originally published by Solidarity.

"Why Don't You Just Get a Better Job" and Other Dumb Shit People Say to Low-Income Earners Stuck in Precarious Work

By Chloe Ann King

For most of my working life I have been stuck in the hospitality industry which is lowly paid, painfully precarious and poorly regulated. In New Zealand, where I live, hospitality employers mostly treat you as nothing more than an easily replaceable unit to turn-over-profit. I have spent over a decade in this industry and as such I have become acutely aware of the fact that no matter how many shifts I work or how many poorly paid jobs I undertake; I will never have enough money to meet rising living costs.

Sometimes, my life is a bit depressing. You know what I mean? I get up, I go and work one of my multiple jobs and I come home. Each week I check my bank balance and I feel pretty put-out about how low my pay is as compared to how hard I worked for it.

Obviously, working hard at minimum wage jobs is never going to land me economic security. No matter how hard I have worked in the hospo industry I have never ever received a pay-rise, not once. The lie of "hard work" serves to convince us that if we fail to achieve happy, healthy and joy filled lives which are economically secure thanks to well paid jobs, it is because we failed to work hard enough for it. Constantly we are told that external factors do not affect us. This type of pervasive 'positive' rhetoric isendlessly used by many self-help Gurus such as Tony Robbins, one of America's most well-known motivational speakers.

The lie of "hard work" is pitched to us - those from the working and lower classes, by not only self-help gurus and spiritualists but politicians and well intentioned high school teachers and even our parents, as being one of the best paths to prosperity. This myth is perpetuated and disseminated by the mainstream media as motivational newsworthy 'human interest' stories. However, there is very little which is human about these types of stories. The core of these news pieces has nothing to do with humanity or being human and everything to do with selfishness and individualism and play on insecurities and our need to compare our lives to others who we think or we are passive aggressively told, have it better than us.

A few months ago the NZ Herald (New Zealand's most read newspaper which controls the national narrative) ran yet another one of these "motivational" articles on a young landlord named Gary Lin. Who has managed to buy up a staggering eleven properties citing "hard work" as a reason for his success. He told the NZ Herald,

"Work hard, work smart, save hard, and invest smart. Wealth creation is not rocket science - perseverance and hard work can get you there."

As if wealth creation is something we should as young people, be aspiring to. In times of great wealth inequality, we should be demanding wealth dispersal not setting out to create and covet wealth for ourselves. Gary, unlike most of us, was given a hefty "leg up" or what we poor folk call a "handout" by his father in the sum of $200,000 as a wedding gift which allowed him to buy his first home which cost him $175,000. I guess for some people money really does grow on trees.

I hate to break it to you Gaz - can I call you Gaz? But "hard work" had nothing to do with your successes in life.

Gaz got lucky. He won the genetic lottery and was born into wealth - he did not earn the money that helped him buy his first home. It was given to him. Instead of using his unearned wealth to help others he made the choice to punch-down and profit off the growing number of people stuck in the rental trap by hoarding properties. Gaz has engaged in predatory behavior by renting his properties out at market rental rates. In an unregulated rental market the odds are never in favor of tenants. As George Minbiot wrote for the Guardian, "Rent is another term for unearned income."

People like Gaz rarely acknowledge their economic success is at the expense of those from the lower and working classes. To recognize this Gaz, might have to feel a little bit bad about how he came into his millionaire property portfolio. He might have some kind of world shattering epiphany that he is not as smart as he believes and his successes are owed more to an ability to stomach the ruthless actions and attitudes needed to 'make it' in a society that is quickly turning into a dystopian one. Which makes The Hunger Games, look like child's play. Sociopathy and luck had more to do with Gaz's successes in life than actual "hard work", talent and intelligence.

Lawyer and anti-poverty activist David Tong, responded to Gaz's flawed belief that anyone can own property if they just "work hard" enough, with these words:

"Motivational read from the NZ Herald: You too can be a rich property investor. If dad gives you a $200,000 gift"

"Hard work" and motivation don't mean shit in a broken economy that was built on the blood, backs and bones of the working class and the most marginalized and vulnerable. Increasingly, accessing upward mobility - which buying property can help you obtain as well as a better quality of life, is becoming an impossible task because of low wages, insecure work and a flooded job market. People are just struggling to get off minimum wage let alone save for a house.

***

The New Zealand Council of Trade Unions states that "At least 30% of New Zealand's workers - over 635,000 people - are in insecure work. We believe it may well cover 50% of the workforce." No matter how hard you work it is impossible to get ahead when your employer only offers you inconsistent hours and denies your basic right to a guarantee of minimum hours.

Casual contracts are used widely within the hospitality and service industries and state that your employer owes you "no minimum of hours." But the expectation is that you will cover and come in when needed and if you refuse you are often faced with penalties. Such as having your shifts cut the next week. Having the stability of a salary as opposed to waged work is a far off dream for so many of us. You can't budget let alone save money for a house when you never know what your pay-check is going to be from one week to the next.

Economic insecurity because of cut shifts and insecure hours has been a major feature of my working life. For example, last year just before Christmas I had my shifts cut in half. I went from working between four and five shifts a week down to only two. I was given six days' notice and when I pointed out how hard this would hit me economically to a Duty manager I was told, "I should go and find a second job" and reminded that "I was only on a casual contract so there was not much I could do about it."

For the last few months I had been back-breakingly flexible for this employer. I had come in whenever I was needed and covered shifts at short notice. I had worked hard to make every customer's experience an enjoyable one, all this for minimum wage. I spent most of December desperately scrounging around for a second job, as did two other workers who had suffered the same fate.

I popped into the same work soon after my shifts had been cut to collect my tips and one of the regulars who had been drinking, accosted me verbally and demanded to know why I was in such vocal support of the recent rolling strikes of Bunnings Warehouse workers. These workers had been subject to Zero Hour contracts, eternal bullying and harassment from managers and no guarantee of shifts or rosters. He said "why don't these Bunnings workers just go out and get a better job". This statement coming from a white male Baby Boomer who enjoyed free tertiary education and did not start his working life off in debt. All is crimson and gold in middle class Whiteywood, I guess.

"Why don't you just go and get a better job?" This singular narrative epitomizes the ignorant attitudes of people like Gaz and the regular from my work whose name is ironically Gary, as well. It also puts the sole responsibility of finding well paid and meaningful work onto the worker, while absolving a government's responsibility to push for job creation which serves their citizenry and the environment and to raise the minimum wage to a living wage, in New Zealand.

If over 30% of the workforce is stuck in precarious work and large sectors of the workforce earn below Aotearoa's living wage of $19.25 an hour, finding "better work" is statistically impossible for a vast majority of us. There are thousands of hospitality businesses in Auckland, New Zealand, and only a handful pay a living wage and nearly none offer a guarantee of hours. As such telling people to "get a better job" is like telling them to buy a lotto ticket and live in hope they take out the jackpot.

***

No matter what the Gaz's, Gary's and the self-help superstars such as Tony Robbins of this world have to say on the myth of "hard work" and perseverance paying off one day, the reality is our ability to access upward mobility; buy a house; obtain a decent standard of living is tied to what type of work you can access. External factors not only deeply impact people's lives they oppress those who do not benefit from certain types of privilege. Not all roads lead to Rome. More often than not for us poor folk they lead to roadblocks and hurdles that increase based on the colour of your skin, the class you were born into and/or your gender, how bodily abled you are and your sexuality or a combination of all of these.

People's situations are complicated and difficult and cannot be curtailed into passive aggressive motivational "one liners" that nearly always punch-down and not up. Our working class struggles cannot be solved by a set of self-help rules or keys or steps which are meant to guide anyone to economic stability and lead you to the life of your dreams and a perfect job. In the book, The New Soft War on Women, the chapter entitled 'Doing Well May Not Work Out So Well', Caryl Rivers and Rosaling C. Barnett, write,

"We like to believe that the workplace is fair and that if we do a good job, we will be rewarded. After all, that's the American way. But this belief is less true for women than it is for men. Indeed, too often women's performance which is stellar gets fewer rewards than men do - even men who are less than outstanding."

During a major speech at Wellesley College, presidential candidate Hillary Clinton, talked about the role women can play in politics and public life, she said,

"We know we've got to keep pushing at that glass ceiling. We have to try and break it… Obviously. I hope to live long enough to see a woman elected president of the United States."

Encouraging women to break the glass ceiling is all well and good but what if moving off minimum wage and accessing a living wage, is no easy feat? In America alone, 6 out of every 10 women are stuck on minimum wage.

The Glass Ceiling is so high up most of us can barely even see it. Researchers at the non-profit group Catalyst point out, "[…] when you start from behind, it's hard enough to keep pace, never mind catch up-regardless of what tactics you use." Both Rivers and Barnett went on to write,

"Doing all the right things to get ahead-using those strategies regularly suggested in self-help books, coaching sessions and the popular press-pays off much better for men than it does for women."

As women, we do not struggle to "get ahead" because of personal failings but this struggle is born from structural sexism which creates gendered inequality.

Telling white women and women of colour to be more ambitious and just "work harder" if they want to smash the Glass Ceiling and obtain a decent standard of living is almost laughable. Considering many women, in particular, indigenous women and women of colour, are still struggling to make it out of the basement. Still, self-help gurus such as Tony Robbins preach to millions that none of what I am writing about actually matters: race, gender… whatever you were born as, and into, does not have to hold you back. You just have to believe in yourself and follow the Tony Robbin's step-by-step guide to snagging a life beyond anything you could ever dream of. Which he has called: '12 Keys to an Extraordinary Life'. You couldn't make this shit up. He said at a recent event:

"I don't care if you are young or old, I don't care what your colour is, what your gender is, what country you come from, if you understand the science of building wealth you can have an abundance of it. If you violate those rules [of the 12 keys to an Extraordinary Life] either because you're ignorant to them or you don't apply then, you are going to have financial stress"

Tony, who sounds uncomfortably like Gaz in his belief anyone can become a millionaire, may as well have just said "we are all one"! "Everyone can make it no matter what grinding and economically depressive situations you come from"! And be done with it.

Financial stress is not brought about because you have unknowingly violated one or more of the '12 Keys to an Extraordinary Life' which Tony has made tens of millions off. Violating female stereotypes of passivity have a lot more to do with our failure or success in the workplace than how hard we do, or do not, hustle for top positions and top earning brackets. Rivers and Barnett write, "Competent women violate the traditional female stereotype of passivity. And that violation can trigger a reaction of fear and loathing [in the workplace]."

Financial stress is brought about because of injustices such as the pay-gap and the coloured pay-gap. Something Tony, has clearly gone out of his way to ignore. Self-help gurus and people like Gaz and Gary tend to, "displace questions of social justice and frame their rhetoric by the individualist and corporatist values of a consumer society," as both Jeremy Carrette and Richard King wrote in the book, Selling Spirituality: the silent take over of religion.

Both Rivers and Barnett point out in relation to the American pay gap,

"Hispanic/Latino women have the lowest median earnings, earning just 55 percent of the median weekly earnings of white men; black women have, median weekly earnings of 64 percent of those of white men."

The pay gap for America's first nation indigenous women also sits at 55 cents in the dollar compared to white men, as non-profit AAUW reports. Indigenous women are faced with earning nearly half of what white men do in America.

Similarly, in Aotearoa indigenous Maori and Pasifika women, face significant coloured/indigenous pay-gaps compared to white men and women. TheDominion Post, reported last year, "Maori and Pasifika women are more likely to be in the lowest paying jobs, which increases the poverty in their lives and communities." The Human Rights Commission has been tracking unfairness and inequality at work and cites that Pasifika women on average earn $57,668 while white men earn $66,900. What this data shows us is that, "Men are paid more than women overall and within ethnic groups. The effects increase when combining several factors as is the case between New Zealand European men and Pacific women. These patterns have persisted over time."

These "patterns" of women of colour and Indigenous women being paid significantly less than white men and women, to do the same damn jobs have "persisted" all over the world from America to Aotearoa. Injustice and oppression is locally and globally connected.

A more accurate description of what the aspirational metaphor of the Glass Ceiling is made out of is to say it is made from lead. So many women are much more likely to fall off what Rivers and Barnett have labelled the "glass cliff" than triumphantly smash the glass ceiling into a million little pieces. Following Tony Robbin's guide to obtaining some magical, fairy-tale life, or any other pseudo bullshit glittery guides to financial freedom, aren't going to be very effective for women born into a system which was built to silence and eradicate them.

The only thing I am aspiring to "smash" is white imperial patriarchal systems that at best disempower women and at worst, brutally and often violently oppress them.

***

As workers we are criticized for our behavior whether we are told we need to be "more ambitious" or we "just need to work harder" in response to our perceived failure to land a great job with good pay and consistent hours. I am so tired of listening to people who endlessly tell me to go and get a "better job" or a "real job" (what does that even mean?!). And I have lost count of the times I have been told by people who hold anti-protester positions to "go and get a job" while I am on the picket line or the protest ground. As if the low waged work I do counts for absolutely nothing. As if service industry work is some kind of phantom job.

This is for anyone who has ever told a service worker to go and get a "job" or a "real job": why don't you make your own double shot soy latte, flip your own burgers and pour your own damn beer and make your own designer espresso martini, which costs more than I make in an hour.

When as a worker, I refuse to put up with horrible workplace conditions and hit the picket line or call the Union as a form of resistance I have been called a "trouble maker", "dirty hippy" and an "inconvenience". I am proud to be all of those things. I am glad I stood up and was brave and risked job loss (sometimes I have lost my job for speaking out) and arrest in an attempt to better my workplace conditions. The only people who are "dirty" are those who seize on disaster capitalism and economically benefit from the oppression of others… I am looking at you Tony Robbin's and Gaz.

We need more workers collectively rising up and following the lead of Health Care workers, Bunning Warehouse and Supermarket workers and more recently Bus drivers. Who have all relentlessly hit union backed picket lines to demand 'fair pay for fair work' and better work conditions, in New Zealand. And less people thinking magically one day their lives will get better if they just play by the rules and perform their duties at work without complaint. This is nothing but blind faith. It is like believing in god: no matter how long you patiently wait he is not going to come and save you.

People from the working classes and those who have been in the wake of the 2008 financial crash, disenfranchised from the middle and upper-classes can save each other. But we need to refuse to allow those who hold power to continue to pit us against one another in some kind of Capitalist Death Match. Where the only prize you get is some demeaning job where the wages are so low you have to pick between buying food or paying the electricity bill. Starving or freezing does not sound like much of a "win" to me. It sounds like bullshit.

The more people who push against injustice in staggering numbers the harder it is for the media to ignore us and distort our messages of resistance.

Many people's grinding situations have nothing to do with individual 'bad choices' or laziness or you know, violating the '12 Steps to an Extraordinary Life'. No matter how many times we hear rotten rhetoric like this we must refuse - absolutely - to accept these types of pervasive and dominant narratives. At their core these narratives use shame and ruggedly focus on the individual as a method to pacify and silence. We must disrupt language that is designed to disempower and divide workers while seeming to empower. We need to seek out ways to elevate the voices of our most vulnerable and the messages of people of conscience who can envision a better world and whose political imaginations outstretch the dominant reality.

Lastly, we need to fight and stand with other workers against employers who exploit their employees and view them as nothing more than units to turn-over capital. Jeremy Carrette and Richard King, went on to write in their before mentioned book:

"We are never obliged to accept the dominant version of reality (however conceived throughout history) without question."