Blood Bank – by Mr. Fish

The Choice this Election is between Corporate and Oligarchic Power

by Chris Hedges | Oct 18, 2024

The choice in the elections is between corporate and oligarchic power. Corporate power needs stability and a technocratic government. Oligarchic power thrives on chaos and, as Steve Bannon says, the “deconstruction of the administrative state.” Neither are democratic. They have each bought up the political class, the academy and the press. Both are forms of exploitation that impoverish and disempower the public. Both funnel money upwards into the hands of the billionaire class. Both dismantle regulations, destroy labor unions, gut government services in the name of austerity, privatize every aspect of American society, from utilities to schools, perpetuate permanent wars, including the genocide in Gaza, and neuter a media that should, if it was not controlled by corporations and the rich, investigate their pillage and corruption. Both forms of capitalism disembowel the country, but they do it with different tools and have different goals.

Kamala Harris, anointed by the richest Democratic Party donors without receiving a single primary vote, is the face of corporate power. Donald Trump is the buffoonish mascot for the oligarchs. This is the split within the ruling class. It is a civil war within capitalism played out on the political stage. The public is little more than a prop in an election where neither party will advance their interests or protect their rights.

George Monbiot and Peter Hutchison in their book “Invisible Doctrine: The Secret History of Neoliberalism,” refer to corporate power as “housebroken capitalism.” Housebroken capitalists need consistent government policies and fixed trade agreements because they have made investments that take time, sometimes years, to mature. Manufacturing and agriculture industries are examples of “housebroken capitalism.”

You can see my interview with Monbiot here.

Monbiot and Hutchison refer to oligarchic power as “warlord capitalism.” Warlord capitalism seeks the total eradication of all impediments to the accumulation of profits including regulations, laws and taxes. It makes its money by charging rent, by erecting toll booths to every service we need to survive and collecting exorbitant fees.

The political champions of warlord capitalism are the demagogues of the far right, including Trump, Boris Johnson, Giorgia Meloni, Narendra Modi, Victor Orban and Marine Le Pen. They sow dissension by peddling absurdities, such as the great replacement theory, and dismantling structures that provide stability, such as the European Union. This creates uncertainty, fear and insecurity. Those that orchestrate this insecurity promise, if we surrender even more rights and civil liberties, that they will save us from phantom enemies, such as immigrants, Muslims and other demonized groups.

The epicenters of warlord capitalism are private equity firms. Private equity firms such as Apollo, Blackstone, the Carlyle Group and Kohlberg Kravis Roberts, buy up and plunder businesses. They pile on debt. They refuse to reinvest. They slash staff. They willfully drive companies into bankruptcy. The object is not to sustain businesses but to harvest them for assets, to make short-term profit. Those who run these firms, such as Leon Black, Henry Kravis, Stephen Schwarzman and David Rubenstein, have amassed personal fortunes in the billions of dollars.

Trump’s cohort of Silicon Valley backers, led by Elon Musk, were what The New York Times writes, “finished with Democrats, regulators, stability, all of it. They were opting instead for the freewheeling, fortune-generating chaos that they knew from the startup world.” They planned to “plant devices in people’s brains, replace national currencies with unregulated digital tokens, [and] replace generals with artificial intelligence systems.”

Billionaire Peter Thiel, a founder of PayPal and a Trump supporter, has waged war on “confiscatory taxes.” He funds an anti-tax political action committee and proposes the construction of floating nations that would impose no compulsory income taxes.

Israeli-American billionaire Miriam Adelson, widow of casino magnate Sheldon Adelson, with an estimated net worth of $35 billion, has given Trump $100 million for his campaign. While Adelson, who was born and raised in Israel, is a fervent Zionist, she is also part of the club of oligarchs who seek to slash taxes for the rich, taxes that have already been cut by Congress, or diminished through a series of legal loopholes.

The economist Adam Smith warned that unless rentier income was heavily taxed and put back into a financial system it would self-destruct.

The wreckage private equity firms and the oligarchs orchestrate, is taken out on workers who are forced into a gig economy and who have seen stable salaries and benefits eradicated. It is taken out on pension funds that are depleted because of usurious fees, or are abolished. It is taken out on our health and safety. Residents of nursing homes, for example, owned by private equity firms, experience 10 percent more deaths — not to mention higher fees — because of staffing shortages and reduced compliance with standards of care.

Private equity firms are an invasive species. They are also ubiquitous. They have acquired educational institutions, utility companies, and retail chains, while bleeding taxpayers hundreds of billions in subsidies which are made possible by bought-and-paid-for prosecutors, politicians, and regulators. What is particularly galling is that many of the industries seized by private equity firms — water, sanitation, electrical grids, hospitals — were paid for out of public funds. They cannibalize the nation, leaving behind shuttered and bankrupt industries.

Gretchen Morgenson and Joshua Rosner document how private equity works in the book “These are the Plunderers: How Private Equity Runs-and Wrecks-America.”

“Routinely lionized in the financial press for their dealmaking and lauded for their ‘charitable’ giving, these unbridled capitalists have mounted expensive lobbying campaigns to ensure continued enrichment from favorable tax laws,” they write.

“Hefty donations have won them positions of power on museum boards and think tanks. They’ve published books on leadership extolling ‘the importance of humility and humanity’ at the top, while eviscerating those at the bottom. Their companies arrange for them to avoid paying taxes on the billions in gains that their stockholdings generate. And, of course, they rarely mention that the companies they own are among the largest beneficiaries of government investments in highways, railroads, and primary education, reaping massive perks from subsidies and tax policies that allow them to pay substantially lower rates on their earnings,” they explain

“These men are America’s modern-age robber barons. But unlike many of their predecessors in the nineteenth century, who amassed stupefying riches by extracting a young nation’s natural resources, today’s barons mine their wealth from the poor and middle class through complex financial dealings.”

You can see my interview with Morgenson here.

The housebroken capitalists are represented by politicians such as Joe Biden, Kamala Harris, Barack Obama, Keir Starmer and Emmanuel Macron. But “housebroken capitalism” is no less destructive. It pushed through the North American Free Trade Agreement (NAFTA), the greatest betrayal of the American working class since the 1947 Taft-Hartley Act, which placed crippling restrictions on union organizing. It revoked the Banking Act of 1933 (Glass-Steagall) which separated commercial banking from investment banking. Tearing down the firewall between commercial and investment banks led to the global financial meltdown in 2007 and 2008, including the collapse of nearly 500 banks. It pushed through the elimination of the Fairness Doctrine by the Federal Communications Commission under Ronald Reagan as well as the Telecommunications Act under Bill Clinton’s presidency, allowing a handful of corporations to consolidate control of media outlets. It destroyed the old welfare system, 70 percent of the recipients of whom were children. It doubled our prison population and militarized the police. In the process of moving manufacturing to countries such as Mexico, Bangladesh and China, where workers toil in sweatshops, 30 million Americans were subjected to mass layoffs according to figures compiled by the Labor Institute. Meanwhile, it piled up massive deficits — the federal budget deficit rose to $1.8 trillion in 2024, with total national debt approaching $36 trillion — and neglected our basic infrastructure, including electrical grids, roads, bridges and public transportation, while spending more on our military than all the other major powers on Earth combined.

These two forms of capitalism are species of totalitarian capitalism, or what the political philosopher Sheldon Wolin calls “inverted totalitarianism.” In each form of capitalism, democratic rights are abolished. The public is under constant surveillance. Labor unions are dismantled or defanged. The media serves the powerful and dissident voices are silenced or criminalized. Everything is commoditized from the natural world to our relationships. Grassroots and popular movements are outlawed. The ecocide continues. Politics is burlesque.

Debt peonage and wage stagnation ensures political control and the further consolidation of wealth. Banks and corporate financiers enslave not only individuals with debt peonage but also cities, municipalities, states and the federal government. The rise in interest rates, coupled with declining public revenues, especially through taxation, is a way to extract the last bits of capital from citizens, as well as from the government. Once individuals, states or federal agencies cannot pay their bills — and for many Americans this often means medical bills — assets are sold to corporations, or seized. Public land, property and infrastructure, along with pension plans, are privatized. Individuals are pushed out of their homes and into financial and personal distress.

“The head of Goldman Sachs came out and said that Goldman Sachs workers are the most productive in the world,” the economist Michael Hudson , author of Killing the Host: How Financial Parasites and Debt Destroy the Global Economy, told me. “That’s why they’re paid what they are. The concept of productivity in America is income divided by labor. So if you’re Goldman Sachs and you pay yourself $20 million a year in salary and bonuses, you’re considered to have added $20 million to GDP, and that’s enormously productive. So we’re talking with tautology. We’re talking with circular reasoning here.”

“So the issue is whether Goldman Sachs, Wall Street and predatory pharmaceutical firms, actually add ‘product’ or whether they’re just exploiting other people,” he continued. “That’s why I used the word parasitism in my book’s title. People think of a parasite as simply taking money, taking blood out of a host or taking money out of the economy. But in nature it’s much more complicated. The parasite can’t simply come in and take something. First of all, it needs to numb the host. It has an enzyme so that the host doesn’t realize the parasite’s there. And then the parasites have another enzyme that takes over the host’s brain. It makes the host imagine that the parasite is part of its own body, actually part of itself and hence to be protected. That’s basically what Wall Street has done. It depicts itself as part of the economy. Not as a wrapping around it, not as external to it, but actually the part that’s helping the body grow, and that actually is responsible for most of the growth. But in fact it’s the parasite that is taking over the growth.”

“The result is an inversion of classical economics,” Hudson said. “It turns Adam Smith upside down. It says what the classical economists said was unproductive – parasitism – actually is the real economy. And that the parasites are labor and industry that get in the way of what the parasite wants – which is to reproduce itself, not help the host, that is, labor and capital.”

The Weimarization of the American working class is by design. It is about creating a world of masters and serfs, of empowered oligarchic and corporate elites and a disempowered public. And it is not only our wealth that is taken from us. It is our liberty. The so-called self-regulating market, as the economist Karl Polanyi writes in “The Great Transformation,” always ends with mafia capitalism and a mafia political system. A system of self-regulation, Polanyi warns, leads to “the demolition of society.”

If you vote for Harris or Trump — I have no intention of voting for any candidate who sustains the genocide in Gaza — you are voting for one form of rapacious capitalism over another. All the other issues, from gun rights to abortion, are tangential and used to distract the public from the civil war within capitalism. The tiny circle of power these two forms of capitalism embody, exclude the public. These are elite clubs, clubs where wealthy members inhabit each side of the divide, or at times go back and forth, but are impenetrable to outsiders.

The irony is that the unchecked greed of the corporatists, the housebroken capitalists, created a small number of billionaires who became their nemesis, the warlord capitalists. If the pillage is not halted, if we do not restore through popular movements control over the economy and the political system, then warlord capitalism will triumph. The warlord capitalists will cement into place neo-feudalism, while the public is distracted and divided by the antics of killer clowns like Trump.

I see nothing on the horizon to avoid this fate.

Trump, for now, is the figurehead of warlord capitalism. But he did not create it, does not control it and can easily be replaced. Harris, whose nonsensical ramblings can make Biden look focused and coherent, is the vacuous, empty suit the technocrats adore.

Pick your poison. Destruction by corporate power or destruction by oligarchy. The end result is the same. That is what the two ruling parties offer in November. Nothing else.

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