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Saturday, April 9, 2016
Where are Marx and Lenin when we need them? — Paul Craig Roberts
Where are Marx and Lenin when we need them?
Paul Craig Roberts
Marx and Lenin were ahead of their time. Marx wrote before offshoring of jobs and the
financialization of the economy. Lenin presided over a communist revolution that jumped the gun by taking place in a country in which feudal elements still predominated over capitalism. In 21st century America capitalism has been unfettered from the regulations that democratized it and made it serve society. Today capitalism is being financialized with the consequence that its productive power is being drained into the service of debt.
When I was a young man, an individual with one million dollars was very rich. Anyone with a few millions more was considered richer than rich. Today there are people who have thousands of millions of dollars.
Few earned their billions by producing goods and services sold to consumers.
The neoliberal economists, who prescribe economic policy not only in the West but also in Russia and China, incorrectly claim that money received is money earned. In fact, how did the Less-Than-One-Percent really get their thousands of millions?
They got them through political connections and through purely financial transactions.
When the Soviet Union fell apart as a consequence of hardline communists arresting President Gorbachev, well connected individuals in Russia and the Soviet province of Ukraine, especially those well connected to Washington and Israel, ended up with massive holdings that formerly were state properties.
In the US billionaires result from bank lending for leveraged takeovers of companies. The takeovers produce riches for the takeover person from curtailing company pensions and using the company’s cash to pay off the takeover loan. Often the company and its employees are ruined, but the takeover artist walks away with massive amounts of money. Manipulation of initial public offerings are another source of riches as are securitized derivatives.
Classical economists, and Michael Hudson today, define these profits as “economic rents,” the income from which required no increase in real output to produce. In other words, these billionaire wealth gains are a form of parasitism based on exploitation and not on the production of real output. The gains result from draining income from production into the service of debt.
Today’s capitalist economies are far more dysfunctional than Marx supposed. For the past two decades Western economies have served no one but the very rich, and the exploited masses have submitted to their exploitation. The Western public may as well be slaves.
There is no reason for a person to have thousands of millions of dollars. The money elevates the political power of individuals over the power of the electorate. Indeed, the money becomes the electorate. The money is used to purchase political control, which destroys representative government. Billionaires, such as Sheldon Adelson, George Soros, and the Koch brothers, use their billionaire fortunes to control the US government in their interests. A Republican Supreme Court has made this easier for them.
The rise of financial power in Russia and China has created private power centers in those countries that, like the ones in the US, are independent of the governments. These power centers have the potential to capture the governments and to use public offices to further concentrate wealth in few hands. Privatizations in Russia and China will strengthen the independent power of narrow private interests as they have in Europe and the UK. Neoliberal economics guarantees that eventaully private money controls the government.
Oxfam, an international charity headquartered in Oxford, England, reports that 62 billionaires own half of the wealth in the world.
It was Warren Buffett, one of the richest mega-billionaires, who said that his secretary’s tax rate was higher than his. If governments do not rectify this, revolution will.
But apparently voters won’t, at least not in the US. Hillary represents the One Percent, as the Clinton’s $153,000,000 in speaking fees attest, but the 99 percent are self-destructing by voting in support of Hillary’s ambition to gain the presidency. Apparently, H. L. Mencken was correct, the vast majority of Americans are morons.
Written by Samuel Harris Friday, 12 February 2016
The latest in a series of annual reports from Oxfam, detailing the level of economic inequality in our world, is a striking example of Marx’s prediction that capitalism concentrates wealth in fewer and fewer hands.
The report, released on January 18th, confirms for many what they already know: the rich are getting richer. The wealthiest one percent now own more collectively than the remaining ninety-nine combined. Oxfam had predicted this would become a fact by the beginning of this year. In fact, it became a reality in 2015.
The absurdity does not end there: the richest sixty-two billionaires’ wealth has increased by more than $500bn since 2010, now standing at $1.76 trillion. Despite the total global population growing by 400m in the same period, these sixty-two individuals are as wealthy as half the world’s population. This is capitalism in all its glory. The rich get richer, while billions of people struggle to survive on meagre wages and, according to UNICEF, 22,000 children die each day of poverty.
Oxfam’s report merely puts into words what we are seeing before our very eyes across the world, namely, dropping living standards, wages that do not rise with inflation, public sector cuts across the board, and a squeezing of the working class for everything they’re worth.
Oxfam points out that approximately $7.6 trillion in private wealth is currently held safely in offshore tax havens. Meanwhile millions of ordinary workers and youth suffer under daily austerity measures and attacks against living standards.
In 2008, worldwide debt was around $30 trillion. Despite ostensibly imposing austerity on workers across the globe to reduce this debt, the opposite to what was promised has been achieved. Current worldwide debt now stands at $55 trillion. Every minute this increases by millions. With no view to breaking with capitalism and striking at the heart of the system - the banks and big monopolies - the state inevitably looks to impose even more austerity on the poorest in society.
What the Oxfam report shows is that in the midst of deep crisis, the rich continue living their lives of luxury. The poor are plunged ever deeper into poverty. It is a confirmation of Marx’s prediction of class polarisation - as capital accumulates in the hands of one class, the workers are ever exploited, opening an unbridgeable gulf between the two. In their hunt for profit the capitalists strip the middle classes of their privileges and reduce them to the same low level as the workers. This process of concentration of wealth and Capital in the hands of an ever smaller minority is a part of the Capitalist system and its inherent anarchy.
Oxfam’s reports have been detailing this rise in inequality for a number of years. It is no wonder they have been threatened with the removal of their charitable status in a number of countries. In 2010, 388 billionaires owned half the world’s wealth - enough to fill a jumbo jet. The 2014 report, “Even it Up”, showed that by 2013 that figure had fallen to eighty-five - enough to fit on a double-decker bus. It is now sixty-two, enough to be seated comfortably on a single-decker coach. In capital terms these sixty-two humans are “worth” 3,600,000,000 other humans.
This club of the ultra-rich, on the current trajectory, will only need to travel by mini-bus by 2020, adding further savings to their cash-piles. You might well ask, at what point will one person own as much wealth as half the world?
Oxfam’s statistics and the extreme poverty visible on the streets of even supposedly wealthy nations show the system is no longer sustainable. A backlash is becoming evident across the world as waves of protest movements develop in one country after another.
The solution is clear. The system is preparing a revolt. We must take our destiny into our own hands. Capitalism no longer furthers the needs of humanity, and must be swept away. Wipe out global debt by ending the rule of the banks. Expropriate the sixty-two billionaires, the one percent, and the banks and monopolies that are the basis of this rotten capitalist system.
Dr. Paul Craig Roberts was Assistant Secretary of the Treasury for Economic Policy and associate editor of the Wall Street Journal. He was columnist for Business Week, Scripps Howard News Service, and Creators Syndicate. He has had many university appointments. His internet columns have attracted a worldwide following. Roberts' latest books areThe Failure of Laissez Faire Capitalism and Economic Dissolution of the West
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