Apr 04, 2013 - Issue 511

BlackCommentator.com: Economics to the Naked Eye: David Stockman Bemoans the “Corruption of Capitalism” - Solidarity America By John Funiciello - BC Columnist

When Ronald Regan ran for president of the United States, he explained in some detail what his advisors had planned for the economy and his budget director from 1981-85, David Stockman didn’t have to wait 33 years to find out that the economy was going to be in deep trouble by 2013.

But Stockman, in a long opinion piece in the New York Times last week, warned that we are, in fact, in deep trouble. And, he said, it looks as if we are going to have a wicked time getting out of the hole we’re in. Even though he was Reagan’s budget man for the Great Communicator’s first term, Stockman resigned when he saw that the direction in which the country was going was going to lead nowhere, but it took him a whole term.

Although it is apparent that he still believes in capitalism, he believes that the two parties that are in control have played havoc with it and turned it into something else. (His recent book is The Great Deformation: The Corruption of Capitalism in America.) Whatever that something else is, the politicians in both parties have held hands while they were presiding over the demise of the economy, according to Stockman. Bailouts for banks, the auto industry, and a “stimulus” package that did not reach the people who need it are just a few of the things that he rails against. And the debt!

The government in Washington is piling on debt, Stockman wrote, referring to “a soaring debt burden on our descendants, (and that the politicians are) unable to rein in either the warfare state or the welfare state or raise the taxes needed to pay the nation’s bills.” Lest you think that he is stumping for taxing the rich, he is for sharing the burden, so he is advocating that major social programs like Social Security and Medicare be means-tested, so that only those in need receive any benefits.

His take on politics makes him sound like any other good government group out there, but even they would not make the suggestions for change that he advocates: “All this would require drastic deflation of the realm of politics and the abolition of incumbency itself, because the machinery of the state and the machinery of re-election have become conterminous. Prying them apart would entail sweeping constitutional surgery: amendments to give the president and members of Congress a single six-year term, with no re-election; providing 100 percent public financing for candidates; strictly limiting the duration of campaigns (say, to eight weeks); and prohibiting, for life, lobbying by anyone who has been on a legislative or executive payroll.”

Like so many before him, he seems to believe that there is some kind of pure capitalism that would work, if only it had not been twisted and corrupted by the marriage between business interests and government, even at a time when experts and economic philosophers are questioning whether capitalism even works any more.

Capitalism is defined by the Merriam Webster dictionary as “an economic system characterized by private or corporate ownership of capital goods, by investments that are determined by private decision, and by prices, production, and the distribution of goods that are determined mainly by competition in a free market.” Maybe that’s the problem. Too often, there has been collusion in the marketplace so that the idea of competition is just that, an idea, and there is little trace of a free market for anything.

For those on the political right, capitalism may be the best way for them to pile up their wealth, so the idea of capitalism is just fine. But the definition says that capitalism is an economic system in which most things are determined by “private decision,” which becomes very dangerous when the private sector and the government, in all its manifestations, tend to combine into one entity. Some define that as fascism. We know about the revolving door between government and Corporate America, in which the bosses of corporations go through that door to occupy high positions in government, and then they leave to go back to their corporations, exerting great influence on the friends in government they have just left. We have that condition in the U.S. and the current administration is as good an example of that as any.

While it is good to hear from someone like Stockman that what the Republicans under Reagan’s presidency set out to do was poison for the country, the question is: Why did he not start speaking out at the end of Reagan’s first term? It reminds us of the mea culpa of Robert McNamara, John F. Kennedy’s and Lyndon B. Johnson’s secretary of defense, when, many years later and not long before his death, he decried what a shame it was that so much blood and capital was squandered on the Vietnam War. And that’s not to mention the destruction and death it left in Vietnam and the neighboring countries.

Here’s the problem about the condition of the American people. There is no consideration of the people in any of this. In fact, the only way (between general elections) the people can express their wishes is through opinion polls and politicians, virtually to a man or woman, reject those polls, usually by saying “we don’t govern by polls.” There was no better example of the flagrant contempt for the opinion of the people than Dick Cheney’s sneering “sooo?” when he was asked about his administration’s actions, which seemed to be directly opposed to the people, as indicated by polls at the time.

Cheney also was making certain that the company he worked for, Halliburton, which was the recipient of billions of dollars for its operations in Iraq during that misbegotten war (which continues today in one form or another), would keep its position at the top of the pile of defense and military contractors who clamor for more billions. Now, that’s a revolving door example, at the highest level. And, it becomes clearer every day that this is one reason that the U.S. is involved in never-ending war. No wonder the people are suffering and will continue to do so for a long time.

Surely, someone like Stockman, in the early months of Reagan’s first term in the White House, could and did see what direction the president’s handlers were taking the country. It’s hard to believe that he didn’t see right at the beginning today’s economic, political, social, health, and environmental morass coming.

Again, they didn’t ask the people at any time along the way. When they were asked about anything, it was usually in a political context, in which fears of the “other” were whipped up, as they usually are by demagogues, so that the people’s view of reality was skewed and they end up voting for the very candidates who support policies that are causing their families and communities to suffer.

In 1980, there were workers who were discussing the long-term effects of the policies that Ronald Reagan was espousing in his campaign for president. Those workers, just rank-and-file workers, based on what they knew of the policies, were predicting what would happen a few years, or a few decades, hence. All of their predictions have come to pass and the U.S. is facing crisis after crisis, in exactly the way they thought it would occur. If these workers could see the result of the reckless policies of both parties, why couldn’t the so-called leaders of the nation see those things? The answer is that they had their own agendas. Or, as Cheney said, when questioned why he was so quick to send American youth to die in the Middle East when he had received deferment after deferment, and never served in Vietnam or anywhere, “I had other priorities.”

Back then, about 33 years ago, untold numbers of the U.S. working class were losing their jobs, as Corporate America continued emptying the nation of its manufacturing and industrial base. It was done just because the goods could be re-imported at a much lower cost and, therefore, at a much higher profit. At the same time, over the past three decades, the assault continued on trade unions, the only institution in the country that expressed its obligation to raising up workers to a decent living standard. Because of that, unions had to be stopped, but short of that, their effectiveness had to be sabotaged. Corporate America has done its job well.

Unions are in as deep trouble as the nation, but polls show that a majority of workers would join a union if their jobs were not threatened. It’s a sorry state of affairs, when Americans are fearful of their First Amendment right of free association, because they might lose their jobs if they join a union. Or, if they even indicate an interest in joining a union. Thoroughly dangerous, those unions, because they provide a platform for opposing the powers that be and, in the economy, that is really dangerous.

Workers of 1980 could have told Stockman, Reagan, Cheney, and a host of others in both parties who have brought us to this condition that what we are suffering in 2013 was predictable, because they predicted it. In fact, unions, in every one of their publications were telling their members what Reagan’s expressed intentions would bring about, if they became policy. They laid it out, chapter and verse, but it didn’t matter.

The Great Communicator’s vision of America won out: apple pie, the flag, guts, guns, and money, and it was all done in gauzy commercials for wide television consumption. The people did buy it and we got more than a generation of “Reagan Democrats,” who pushed and supported Republican policies that, to this day, impoverish the working class and make the U.S. a pariah nation around the world. The Cheney’s of the world relish the fear that the power of the U.S. instills in most other nations.

If Stockman and others in 1980 had just asked the people who were the victims of national policies that left them bereft of the means of a livelihood, they would have known what we would be facing in 2013. But the people are never asked, not in any way that is meaningful or accurate. This did not happen to just a small portion of society, it happened to the vast majority and, if one had eyes to see, one could have seen it coming. Stockman should have been able to see it and, had he been honest, he would not have lasted the first year of the Reagan Administration, let alone the entire first term. 

The vast disparity in wealth in this country, a disparity that is bringing down the great world power, is the whirlwind that we reap, having sown economic, social, and political inequality and the idea that profit for the few was a greater good. The one or two percent at the top got their wish…they are filthy rich…and the people are just now beginning to wake up to the reality of the past three decades. The vast majority needs to wake up from its slumber, organize and turn things around before we find that it’s too late.

BlackCommentator.com Columnist, John Funiciello, is a long-time former newspaper reporter and labor organizer, who lives in the Mohawk Valley of New York State. In addition to labor work, he is organizing family farmers as they struggle to stay on the land under enormous pressure from factory food producers and land developers. Click here to contact Mr. Funiciello.