Marx, the One-Dimensional Character

Normally I like the Christian Science Monitor as a unique fixture in the US, comparable to Al Jazeera. But sometimes it releases stories surprisingly soaked in Western chauvinism. This is one such example:

"Marx provided the intellectual foundation for an array of regimes that at one time governed nearly half of Earth's population.
These regimes were, for many, a long nightmare of state terror, genocides, deportations, extrajudicial executions, forced labor, and artificial scarcity, crimes that left tens of millions of people dead and deprived many more of basic dignity. 
But while Marx's solutions are widely and rightfully condemned, his analysis still resonates among workers and intellectuals alike around the world." -Karl Marx: 10 Great Quotes on his Birthday, Eoin O'Carroll

Of course, the article is incorrect when it says that Marx's suggestions are "rightly rejected" after insinuating that the fascist regimes using his namesake followed them. It's pretty simple to see that worker control wasn't even tried by the prevalent regimes in question, which was basically the only suggestion that Marx made. Furthermore, most of the quotes are clichés: vampiricism of capital, the opiate of the masses, and similar quotes that have been emphasized for their rhetorical value more than the value of their inherent analysis. Omitted are quotes like this:

Individualism: The Freedom of Independence

This is part 2 of a 3-post series dealing with the Marxist concept of Socialism and Individualism.
 
Part 2: The Freedom of Independence


Human existence is a social phenomenon. The "individualist" ideal of capitalism seeks to privatize the sum of human relations in order to free the human being. Indeed, the many libertarian ideals seek to arrange society in such a way that "nobody steps on anybody else's toes." Property should exist as an extension of the individual. And the individuals, in turn, voluntarily exchange property.³

“The rate of privation between members of society is precisely the antithesis to the rate of independence or individualism.”

The facts, however, paint a different picture. The calculus of human "utility" posits that the disutility of uncomfortable jobs should incur greater pay - the opposite is true. Jobs with less autonomy, greater physical requirement, greater tolls on health and dirtier conditions tend to pay less. The social supply of labor, rather than the individual valuation of labor is the chief determinant of the value paid to workers. It is precisely this irrational construct which determines that an increase in the available productive forces of society, that is an increase in supply of labor, should instead decrease the value and incentive of a worker. What appears as an obvious supply-demand function is in the aggregate an irrational transfer of value to a minority - the capitalist who can pay his or her workers less, and yet has more supply (labor) available, and a larger potential market (laborers as consumers).^{3, 4}

Ames: California Class War History: Meet the Oligarch Family that's been Scamming Taxpayers for 150 Years, and Counting

Henry Miller collected the largest wealth of land in US history,land largely aqcuired by scams:

"Miller scammed the federal government for land and ruthlessly used corrupt state courts to steal land from owners of Mexican land grants. One of his crowning achievements was when, with the help of the notoriously corrupt lawyer and future California governor Harry Haight (after whom Haight Street was named), Miller and Lux litigated a Mexican-American landowning family into insolvency and forced them to sell a property called Buri Buri Ranch, which stretched from the southern tip of San Francisco all the way down to Burlingame, spanning some of the best property in the Bay Area."

Today, the same bloodline uses their inheritance to accrue massive federal funds and favor with the political elite:

"Jim Nickel runs the family’s agricultural and water operations, while Jamie Nickel serves at the director of Federal Crop Insurance Corporation at USDA and manages the real estate end of the business.  Meanwhile his grandson, George W. Nickel, III, is is a budding politician in California, who unsuccessfully ran for the state senate and now works in the Obama administration. Oh, and on top of everything, the family gets a nice revenue stream from the federal government, pulling in roughly $3.6 million in farm subsidies since 1995."

Read the rest here: http://exiledonline.com/california-class-war-history-meet-the-oligarch-family-thats-been-scamming-taxpayers-for-150-years-and-counting/

Economic Liberals Admit it: Capitalists Own Us

"Don't tax the rich, as they create jobs," so the mantra goes. However, this line of thinking betrays the underlying structure of production: namely, that the capitalist class has executive control over the means of production - control which is a concern of public policy, as Cato and the Heritage Foundation admit by requesting policy that regards its standing. Despite that fact, policy proposals argue for diminished public input. Indeed, history shows us that such control has always underlined this graft:^1,2,3,4

• Today, the Capitalist creates jobs by allowing the working class to use the means of production and sell their labor to him.
• Before that, the Lord created jobs by allowing the working class to use the means of production and give part of their labor to him.
• Before that, the Slaver created jobs by having the working class use the means of production and he (and it was always a man - patriarchy and all that) provided basic subsistence to them.

It has always been the narrow control over the means of production that allowed the interests of a group of oligarchs to consistently stand as a barrier to the production process. Interestingly, when these power structures shifted, it was always by diminishing the returns that older systems could replicate. The oft-revered Mises agrees: it is by diminishing the surplus value on capital investment that the same is disincentivized.² Is calling for safer structures for capitalism simply another incarnation of the tactical perpetuation of power? And does this activity fit the theoretical model of consumer-driven capitalism?

Astroturfing Bankers in the Age of Jackson

In the early 1800s, the US banking system was dominated by a unique blend of proprietary bank notes held by wealthy merchants and a working class mostly limited to foreign currencies (when they were lucky enough to earn real money at all). New England merchants, ever reliant on European trade, had developed or maintained extensive connections to prominent European trading partners. The capital to valorize these products, coupled with the unique trading opportunities that a continent of untapped resources offered, were fertile ground for a rising class of bourgeois. A shipbuilding/fishing economy had given way to an international-mercantilist model, and the monetary supply could hardly keep up with growth.

As this rapid accumulation of capital progressed, a clear winner was bound to emerge - and the US Government wasn’t playing around: they were going to enthrone the financiers to their own ends. Remember, in those days money wasn’t quite as easy as it was now – loans were in the form of promissory notes or proprietary bank notes: unlike fractional reserve banking, there was little liquidity in loaned value. This was such a problem that it would cause a run on debt in 1937. For the better part of the century, the country was set to witness profound clashes between nearly monolithic financial interests - interests, it turns out, that would manipulate popular movements to push their own financial agenda, all in the name of the "free market."¹

Glass-Steagall: Dead for 2 Decades and Counting

Where the Wealthy Meet to Engineer Crises

Clinton's 1999 repeal of Glass-Steagall was hardly a repeal at all. In fact, it was just the dying breath of legislation that had been steadily eroded for decades. Following Alan Greenspan's pivotal moves for deregulation, the Gramm-Leach-Bliley Act merely confirmed in official canon what had been increasingly evident for the past 2 decades.

In 1996, Greenspan gave the Federal Reserve Board the green light to change the practices governing commercial bank holding companies. Under Glass-Steagall, they could only invest up to 5% in investment banks (due to the added risk). Greenspan quickly doubled this limit twice: first to 10%, and then to 25%. 8 months later, another decision opened the doors to insurance underwriting, allowing Traver's (under the management of Sandy Weill, who had already unsuccessfully tried to acquire JP Morgan) to acquire Solomon Brothers. Less than a year later, Traveler's merged with Citicorp.¹


Enter the beast: a bank which merged securities underwriting, insurance underwriting and commercial banking - precisely the amalgamation which ushered in the banking instability of the early 1900s - only this time, the publicians had a new motto: too big to fail. Perhaps more ominous is the name itself though: Citicorp, now Citigroup Inc., was once known as National City Bank, variously administered by James Stillman (who managed the bank in his retirement via discrete courier), Charles E Mitchell (touted in 1933: "Mitchell more than any 50 men is responsible for this stock crash" -Carter Glass).² Mitchell was also on the board of directors for American IG Farben³ (a pharmaceuticals combine which produced Zyclon B for the Nazis), which cartelized with Standard Oil New Jersey with the help of a 30 Million bond from National City Bank.^2,4

Herbert Hoover Left False Evidence to Hide Influence of J.P. Morgan, Thomas W. Lamont

According to Thomas Ferguson, Hoover wrote diary entries which directly conflicted with his private account of events:

"The onset of the Great Depression opened a new phase in the decay of the now creaking system of '96. As the Depression grew worse, demands for government action proliferated. But Hoover, who gradually became so in thrall to the big banks that he concealed Morgan's crucial role in initiating his famous European debt moratorium of June 1931 by deliberately faking entries in a "diary" that he left historians (one of whom years later cited it as evidence for the independence of Hoover, and the American state from the bankers), opposed deficit-financed expenditures and easy monetary policies.⁷⁹ After the British abandoned the gold standard in September 1931 and moved to establish a preferential trading bloc, the intransigence of Hoover and the financiers put the international economy onto a collision course with American domestic politics. Increasingly squeezed industrialists and farmers began clamoring for government help in the form of tariffs even higher than those in the recently passed Smoot-Hawley bill; they also called for legalized cartels and, ever more loudly, a devaluation of the dollar through a large increase in the money supply." Golden Rule: The Investment Theory of Party Competition Thomas Ferguson, pp. 145 (my emphasis)

Obama's Graft and the Woeful State of Consumer Arbitration

I've occasionally cited industrial investment in party politics as the primary motivator in party competition (a point I've largely refined from my reading of Thomas Ferguson: Golden Rule: The Investment Theory of Party Competition...). Yves Smith agrees - its donations that manage the presidential policy positions:

"Obama needs to raise an estimated $1 billion to win the 2012 election. He’s moved further and further to the right over the course of his Presidency. Why is he going to change gears and alienate one of his biggest donor groups by appointing Warren?"

Also, Yves points out to these startling statistics on the bias of consumer arbitration:

"An example we cited a few days ago, that of the settlement reached between the Minnesota attorney general and the National Arbitration Forum, illustrates this point. The [NAF] was so successful in stacking the deck on mandatory arbitrations in favor of its clients, big busineses, via the roster of arbitrators it chose that consumers won in only 4% of the cases." Yves Smith: Why Liberals Are Lame (Part 2)

Libyan Oil and Consumer Demand

Auerback makes a few critical points in his recent article,The Economic Policy Behind Intervention in Libya Chases Its Own Tail (HT: Naked Capitalism). Forgive the banal usage of "we" to associate oneself with the ruling clique, and we have a viable polemic against US fiscal and foreign policy:

"We seem to have developed a very basic rule of thumb when it comes to these wars of choice: if an insurgency threatens oil supplies directly or indirectly, we move. If it doesn’t, we don’t. Hence Syria can kill thousands of insurgents (as they did in the early 1980s) and we do nothing. Yemen doesn’t have oil facilities; so we do nothing. In Bahrain we have a huge base and unrest has repercussions for the Shiite part of Saudi Arabia where the oil is. We move via the Saudis. In Libya there is oil. Again, we moved.

What Will Replace Collective Bargaining in Wisconsin?

With all of the debate around workers' rights in Wisconsin, surprisingly little attention is being paid to the groups which stand to benefit from the elimination of the organized labor's influence among public sector employees (apart from the value of a market with fewer unions and hence less labor influence).

Make no mistake about it: the legislative process in Wisconsin is an attempt to destroy the influence of public sector workers, by eliminating the American Federation of State, County & Municipal Employees (AFSCME) locals, which provide them with a unique tool to influence their workplaces. Once the annual recalls of the union start (a stipulation of the legislation), it is only a matter of time before the union locals fail to accrue a sufficient number of votes in one cycle, lose their funding and experience fatal insolvency.