"The Predator State: How Conservatives Abandoned the Free Market and Why Liberals Should Too"
First, a confession; I have not yet read this book.
Jamie Galbraith's book, The Predator State, outlines what I consider to be the most dangerous assumption under which liberals and moderates are operating today. The assumption that the solutions to our problems must be market based. I have strongly felt that the existence of a free market is as much a myth as John McCain is a maverick. Our only path out of the woods is to abandon this assumption; the challenge is to convince the mob that there has not been a free maket in quite some time. Although I'm sure some citizen will point out her e-Bay store as proof positive of the existance of a free market.
The last sentence of the review is the one that makes me feel most irate. (And I have felt this truth for some time.)
http://economistsview.typepad.com/economistsview/2008/05/the-predator-st.html
(Emphasis, mine)The general theses can be simply stated. First, while conservatives toyed with laissez-faire, they quickly abandoned it in all important areas of policy-making. For them, it now serves as nothing more than an enabling myth, used to hide the true nature of our world. Ironically, only the progressive still takes the call for "market solutions" seriously, and this is the major barrier to formulating sensible policy. Second, the "industrial state" has been replaced by a predator state, a coalition of relentless opponents of the very idea of a "public interest", whose purpose is to master the state structure in order to empower a high plutocracy with nothing more than vile and rapacious goals. Finally, the "corporate republic" created by the likes of Dick Cheney is highly unstable, a formula for national failure. Progressives must wrest control from the reactionaries before it is too late for restoration of America as the world's financial anchor, technological leader, and promoter of collective security.
The free market reactionaries promised that some combination of monetarism, supply side economics, balanced budgets, and free trade was the solution to America's woes. The mantra "free markets" provided an easy antidote to "planning" that was said to constrain recovery and growth. As each conservative policy was tried, however, it resulted in obvious and even spectacular failure. In truth, all economies are always and everywhere planned--for the simple reason that planning is the use of today's resources to meet tomorrow's needs, something that all societies must do if they are going to survive--so the only question is who is going to do the planning, and to whom are the benefits going to flow? There are still a few true believers (principled conservatives that Jamie compares to noble savages in the political wilderness), but most conservatives realized that there is no conflict between "big government" and "the market" as they abandoned the myth but usurped the "free market" label. All we are left with is the liberal who embraces the myth out of fear of being exposed as a heretic, a socialist, or a fool. Thus, the liberal pines to "make the market work better", never challenging the view (abandoned by all but the most foolish conservatives) that government is the problem.
Economic freedom is reduced to the freedom to shop, including the freedom to buy elections, and anything that interferes is a threat. "Market" means nothing more than "nonstate", a negation of use of policy in the public interest. Jamie provides a careful analysis of the frontline battles on many of the most important issues--Social Security, health care, inequality, immigration, security after 9-11, trade and outsourcing, and global warming--showing how "market solutions" are designed to enrich a favored oligarchy through a spoils system administered through the state's structure. The policy "mistakes" in Iraq or New Orleans or at Bear-Stearns do not result from incompetence--indeed they only appear to be failures because we apply inappropriate measures of success. There is no common good, no public purpose, no shareholder's interest; we are the prey and governments as well as corporations are run by and for predators. The "failures" enrich the proper beneficiaries even as they "prove" government is no solution.
Excellent. I concur 1000% Highly recommended.
C
August 20, 2009 10:10 PM | Reply | Permalink
Naomi Klein has told the same tale, it seems. This strikes me as a very good complement to The Shock Doctrine.
August 20, 2009 10:26 PM | Reply | Permalink
I got to 'get back' but cheney and others just see outsourcing as a way to reward their own companies, families and friends...
like when cheney said in the debates that his company did not make money from the government. GOVERNMENTS WERE THE ONLY SOURCE OF INCOME FOR HALLIBURTON.
And he got away with it.
CROOKS. WE HAVE A MARKET BASED UPON FELONY THEFT.
August 20, 2009 10:16 PM | Reply | Permalink
Privatized profits, socialized losses. They have effectively bankrupted us.
August 20, 2009 10:31 PM | Reply | Permalink
Thanks for this. Galbraith's book is on my list of books to read - whenever I can sit still long enough to do so! I've had benefit of listening to numerous interviews of him and find him to be "spot on" in discussing today's economic/political realities. I really appreciate your inclusion of this review clip. This is exactly what has made my hair stand straight up whenever encountering someone trying to score a point by insisting we need to rely upon "market solutions" to any particular problem.
As I wrote about in a previous blog, the economic recovery effort is probably the most recent and outrageous example of how "the public good" is simply a non-existent consideration. Hundreds of billions of dollars were taken from our Treasury under the direction of Wall Street Execs posing as civil servants. These monies were directed to prop up these banks - to reset their license to steal if you will - without the least concern that any effort should be made to actually address the problems confronting Main Street (i.e. home foreclosures; home devaluations; unemployment; etc.) The champagne flows today on Wall Street as the corporate banks that created the problem in the first place celebrate their recovery and their return to obscene profits and astronomic exec pay packages. Meanwhile, Main Street awaits its own recovery plan with no one truly advocating for their interests in Congress.
Definitely rec'd!
August 20, 2009 10:50 PM | Reply | Permalink
I think a critical mass of concerned citizens is catching on to this reality. But time may not be on our side.
August 20, 2009 11:58 PM | Reply | Permalink
excellent post, recommended. It's frightening how the predator state works:
The engine of Wall Street.
The steering of K Street.
The robbing of Main Street.
For the whole thing to work, it requires the successful feigning of Democracy and good faith on Main Street. This is the part of the equation that's the most brutal and contemptible.
Average Americans who consider themselves right-wing conservatives have been so used by their movement leaders.
But now that the power brokers have changed, well, now that the power structure has changed parties, are progressives the ones who will be most used?
August 20, 2009 10:52 PM | Reply | Permalink
Average Americans who consider themselves right-wing conservatives have been so used by their movement leaders.
as long as their cultural development is led by Limbaugh, how long before this group recognizes the betrayal?
But now that the power brokers have changed, well, now that the power structure has changed parties, are progressives the ones who will be most used?
I believe there has been a backlash against the President by a healthy group of liberals. That may help answer the question but we will know for sure next Nov.
August 20, 2009 11:20 PM | Reply | Permalink
We have developed an adoration for capitalism that is bereft of any consideration for humanity. We have abandoned any pretense of competition in favor of corporations. How many massive recalls do we need before we say, STOP!, let's have more producers of these products. At this time, as the number of competitors dwindle, the competitive pressure to lower prices is removed and the middle men are taking all the benefits unto themselves. We are abandoning the American Dream, that anyone who works hard can become successful in favor of declining to put a bridle on capitalism. It's natural development leads to monopolies and that state shows no favor to the people. Nevertheless, these half-wits are screaming in favor of them. Frankly, without a Fairness Doctrine, if the Right Wing talking points is all they receive, then it si no wonder it has become all they know.
August 21, 2009 3:10 AM | Reply | Permalink
10,0000 I want to rec this blog 10,000 times. But alas I cannot.....
I want to shout from the roof tops "People wake up. You've been had. You've been lied to and stolen from" but nobody would listen because the do not want to.
C
August 21, 2009 9:20 AM | Reply | Permalink
Thank you for the kind words, cmaukonen.
August 21, 2009 10:21 AM | Reply | Permalink
You know how in The Matrix movies where humans' perceived reality is simply a computer simulation of "normal life" while the true reality is that they're slaves to the machine race and even when this is brought to their attention, they prefer to go back to their dreamlike trance rather than face the harsh realities of "real life" (I'm thinking Joe Pantoliano's charater here).
Yeah, it's kinda like that.
Just substitute "corporate race" for "machine race."
Cut. Print. That's a wrap.
August 21, 2009 3:29 PM | Reply | Permalink
Same as it ever was. If the rabble becomes unruly, bread and games will keep them docile.
August 21, 2009 10:11 AM | Reply | Permalink
Any free market system must actually produce goods to... market. We are now producing financial card tricks to sip away funds from other funds in cross-hatched feeder lines resupplied with borrowed money. Shoppers buy imported gimcracks with credit cards; in this respect, everyday folk at the mall are the enablers of this short-term system. We stop prowling Macy's, and it's crisis time.
This country was once a manufacturing giant. Now China has assumed that role, and that's why it's become the big bankroll to which every other nation wants to sidle up and coochie-coo. Controlled, planned economies didn't work either; China didn't get to be a financial player until it junked Marxism in its economic approach. Any nation's economy is solvent to the extent it earns its way producing marketable goods, not merely shifting money around. And no market is truly "free"; if nothing else, its mechanisms are ruled by base human greed.
August 21, 2009 10:32 AM | Reply | Permalink
In reply/agreement... (too lazy or too preoccupied for a rewrite):
http://tpmcafe.talkingpointsmemo.com/talk/blogs/kfreed/2009/08/did-somebody-say-predator-stat.php?ref=reccafe
August 21, 2009 11:29 AM | Reply | Permalink
READ THIS BOOK!
I also recommend reading Thorstein Veblen's Theory of the Leisure Class and Absentee Ownership. (Both available to read on-line for free).
In the first, Veblen accurately describes how the "Substantial Citizen" came to believe how they are above the rest and deserve what they have--just like Health Care and Wall Street Exec's justify their exorbitant pay schemes.
In the second Veblen outlines what will happen if business and finance are left to go unregulated and unaccountable--which is--gee--exactly what happened BEFORE the great depression and exactly what happened recently. There is also a great discussion on what happens when pay is no longer attached or related to production--brilliant and sad all at the same time. After reading about the "Substantial Citizen" and the "Captain of Industry" you can pretty much predict where these kinds of leaders will take the country and why there is so much resistance to reform in banking and health care.
Galbraith basically takes these observations (Veblen looked at economics as culture as opposed to rational choices) and applies them to what happened since Reagan (whose new advisors opposed his father JK Galbraith). Again--highly recommend these books.
August 21, 2009 2:05 PM | Reply | Permalink
Thanks for the guidance. The review mentioned Veblen's analysis' and I'm looking forward to reading his work.
August 21, 2009 2:27 PM | Reply | Permalink
Very highly rec'd.
I've read a lot of Galbraith's online articles in the past couple of years and think the world of him. He seems to be one of the very few who understands FDR economics, defends it vociferously and unapologetically advocates a return to those principles. In a sane world, he would be a high admin official. As it is, Obama has wasted the opportunity to fix the destruction of the American System by appointing crass and mendacious apologists for the financial oligarchy, from Summers and Geithner on down, who are insuring that we will stay the course to total economic meltdown.
I don't believe for a minute that there is a recovery around the corner, nor any "green shoots" popping up. The real physical economy continues to contract, the toxic mess in the banking sector hasn't been erased, only papered over with trillions sucked out of the Treasury, printed by the Fed and otherwise created out of thin air. Only by putting the current monetarist system thru orderly bankruptcy proceedings and by launching a new credit system that lends only to productive enterprises and bankrolls vast infrastructure spending will we ever see this mess start to be alleviated in our lifetimes. Unfortunately, Obama seems to have no real understanding of economics and is credulously heeding the advice of the predator class and its prescriptions.
You see it in his Healthcare policy - cut Medicare by a Trillion, cut costs; austerity. Austerity in the face of a collapsing economy, massive job losses, diminishing demand and deflation is insane. That is the course Hjalmar Schacht took in Germany in the 30's, totally contrary to the course taken by FDR in the same time period. Of course, Schacht had his admirers in the City of London and Wall Street in his day. I suggest we don't make the mistake again of letting their modern-day equivalents back that same losing horse again.
Instead of austerity, as Galbraith has argued, we need to expand Medicare, fund a Medicare-for-all single payer system. I would cancel the bailout and use some of the money, say $150-200 billion imediately, in revenue-sharing with the States to staunch the draw-down in services being caused by the collapse in state tax revenues. Virtually every state in the union is bankrupt in the sense that they are continually cutting bugets and services since they can't deficit spend. This can only be addressed by the Federal gov't.
But fundamentally, the only long-term solution is ending the control of the world monetary system by private banking and financier interests. That means dissolving the Federal Reserve (an unconstitutional abomination) and replacing it with something like the National Banking system we've had at various times in this country. Asserting sovereign control of our currency and credit, direct investments into long-term priorities like mass transit, a high-speed rail system, energy production, electric or hydrogen cars, water treatment facilities, upgrade our dams, locks, canals and river systems, and set 25-50 year goals like developing fusion energy for both energy independence and for fusion propulsion spacecraft for colonizing the solar system. This kind of science-driver approach will give us a national cultural optimism that is crucially lacking today, and will set into motion a long-wave of beneficial social and economic forces, akin to what FDR's reforms accomplished.
August 21, 2009 5:41 PM | Reply | Permalink
Thanks for the review. Looks like a perceptive book.
I also read previously mentioned, The Shock Doctrine, and am currently reading: Democracy, Inc.
by Sheldon Wolin, which I recommend and sounds from the quote you selected that it is very similar.
It would be great to get these authors together for a Democracy Inc type documentary film, along the lines of the currently out Food Inc.
Might reach a few people.
August 21, 2009 5:45 PM | Reply | Permalink
Everything is peachy in this review, and I of course agree with the thesis, but then this sentence makes my blood boil.
Any economically literate person, especially one who shares the book premise that the present US state, dominated by finance, is predatory, should be shocked. So the U.S. should put its house in order in order to be better able to behave as a predator towards the rest of the world?
The U.S. has "anchored" the world's finance since 1945 through managing the reserve currency, and used the power that comes with that position, first to limit social progress in the rest of the world and then, since the 1980s, to push the world, especially Latin America, into reverse.
People all over the world have the right to expect progressive U.S. citizens to be against the continuation of this predation just as much as they are against being themselves prey.
The global power of the U.S. should not be "restored," it should be peacefully euthanized, for the good of the world as well as for the good of Americans.
Those who argue otherwise are not progressive.
August 21, 2009 8:00 PM | Reply | Permalink