AuthorTopic: 🤑 Wealth Maldistribution  (Read 7748 times)

Offline RE

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If there is one group of people I feel no sympathy for, it is NY Shity Real Estate Developers.  I hope they lost their shirts.


Recode Daily: Amazon dumps NYC, shocking developers who had rushed to be near its new HQ2
Plus: Trump will declare a national emergency to get money for his wall; JPMorgan Chase creates its own cryptocurrency; meet Australia’s first tech billionaires.
By Recode Staff Feb 15, 2019, 8:14am EST

People opposed to Amazon’s plan to locate a headquarters in New York City hold a protest inside of an Amazon book store on 34th St.. on November 26, 2018, in New York City. Stephanie Keith / Getty Images

In a startling and rare defeat for the $800 billion tech giant, Amazon is scrapping its plan to bring a new headquarters — along with 25,000 jobs — to New York City. The company had faced a wave of fierce opposition from New York politicians, activists, and labor unions. Amazon says it will continue with plans for a new corporate campus in Northern Virginia that can hold up to 25,000 employees, and will spread the remaining 25,000 jobs over its existing 17 offices and hubs throughout North America. The move stunned real-estate speculators, developers, and renters who had rushed into the Long Island City neighborhood to be near the new HQ2 development. Amazon’s pullout was a huge victory for the groups that protested the billions in tax breaks the company brokered in secret, but some of the deal’s architects — including New York Governor Andrew Cuomo and New York City Mayor Bill de Blasio — wish that Amazon had stuck around and compromised. [Jason Del Rey / Recode]
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New York City Mayor Bill de Blasio slammed Amazon for canceling its HQ2 project, calling it 'an abuse of corporate power'

Ellen Cranley

Bill de Blasio New York City Mayor Bill de Blasio speaks during a news conference, Wednesday, April 26, 2017, in New York's City Hall. AP Photo/Mary Altaffer

    Sunday's "Meet the Press" stoked sharp condemnation from New York City Mayor Bill de Blasio on Amazon's decision to cancel its deal to build HQ2 in the city.
    De Blasio said Amazon had let down working people when the tech giant "took their ball and went home."
    In a later appearance on the show, Democratic National Committee head Tom Perez said open opposition from top Democrats didn't mean the party was anti-business, just that it was seeking "moral capitalism."

Top Democratic figures sounded off on Amazon's decision to back out of a deal to build a headquarters in New York City Sunday on NBC's "Meet the Press."

New York City Mayor Bill de Blasio slammed Amazon for canceling its HQ2 project, saying the tech giant "took their ball and went home."

The company had announced in November that it would bring 25,000 jobs to a large campus in a western section of Queens' Long Island City neighborhood.

Despite its projected job creation from the project, there was immediate backlash from local lawmakers and interest groups, particularly about the company's decision to accept tax breaks from the state that equaled around $3 billion. Locals also took issue with the company circumventing the local land-use process.

After the announcement, de Blasio immediately hit back, saying "you have to be tough to make it in New York City," and if Amazon couldn't recognize the city's value, "its competitors will."

"I have no problem with my fellow progressives critiquing a deal or wanting more from Amazon — I wanted more from Amazon too," de Blasio said. "The bottom line is, this was an example of an abuse of corporate power. They had an agreement with the people of New York City."
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New York City Mayor Bill de Blasio slammed Amazon for canceling its HQ2 project, calling it 'an abuse of corporate power'

Ellen Cranley

Bill de Blasio New York City Mayor Bill de Blasio speaks during a news conference, Wednesday, April 26, 2017, in New York's City Hall. AP Photo/Mary Altaffer

    Sunday's "Meet the Press" stoked sharp condemnation from New York City Mayor Bill de Blasio on Amazon's decision to cancel its deal to build HQ2 in the city.
    De Blasio said Amazon had let down working people when the tech giant "took their ball and went home."
    In a later appearance on the show, Democratic National Committee head Tom Perez said open opposition from top Democrats didn't mean the party was anti-business, just that it was seeking "moral capitalism."

Top Democratic figures sounded off on Amazon's decision to back out of a deal to build a headquarters in New York City Sunday on NBC's "Meet the Press."

New York City Mayor Bill de Blasio slammed Amazon for canceling its HQ2 project, saying the tech giant "took their ball and went home."

The company had announced in November that it would bring 25,000 jobs to a large campus in a western section of Queens' Long Island City neighborhood.

Despite its projected job creation from the project, there was immediate backlash from local lawmakers and interest groups, particularly about the company's decision to accept tax breaks from the state that equaled around $3 billion. Locals also took issue with the company circumventing the local land-use process.

After the announcement, de Blasio immediately hit back, saying "you have to be tough to make it in New York City," and if Amazon couldn't recognize the city's value, "its competitors will."

"I have no problem with my fellow progressives critiquing a deal or wanting more from Amazon — I wanted more from Amazon too," de Blasio said. "The bottom line is, this was an example of an abuse of corporate power. They had an agreement with the people of New York City."

Maybe some payback by Bezos over the whole Enquirer thing.......and the lack of enthusiasm for his job creation largesse. NY people don't want shitty jobs with Amazon. They want guaranteed minimum income.

Bezos wants slave labor. They should build their hub in Honduras or Guatemala maybe.

What makes the desert beautiful is that somewhere it hides a well.

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🤑 Amazon Is Waging Class War
« Reply #63 on: February 21, 2019, 12:19:14 AM »
Somebody besides me noticed! YAY!  :icon_sunny:


Amazon Is Waging Class War

    Richard Lachmann

Let's call Amazon's cancellation of its New York City headquarters what it was: a capital strike. It's a demonstration of why we must overcome capitalists' power over investment.

Amazon CEO Jeff Bezos on September 19, 2018 in National Harbor, Maryland. Alex Wong / Getty Images

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Amazon’s sudden announcement that it would back out of building a second headquarters in Queens, New York — which was slated to employ at least twenty-five thousand people supposedly set to earn an average of $150,000 per year — made no sense as a business decision. Amazon had undergone a lengthy and elaborate process to pick the optimal location for its new campus. As suspected, Amazon settled on a city (actually two) that had high concentrations of workers with the needed technical skills, a major airport, mass transit, and the sorts of cultural attractions that would entice employees to move to or remain in that city.

New York and Washington met Amazon’s stated criteria. In addition, Washington is the nation’s political capital, and New York is the capital of almost everything else. Neither New York nor Washington offered as lavish financial incentives as the other applicants, which sought to make up for their less educated workforces, lack of a viable center city, and cultural wastelands via huge giveaways.

The opposition to the deal with Amazon, while intense and heartening, was likely to be defeated in the end. Governor Andrew Cuomo and Mayor Bill de Blasio had the authority to override objections from other elected officials and push through the zoning changes needed for Amazon to build their ideal campus. Governor Cuomo could have blocked the State Senate’s appointment of HQ2 opponent and Queens state senator Michael Gianaris to the Public Authorities Control Board, which had the power to reject projects like Amazon’s. Most of the actual cash subsidies and tax abatements were “as of right,” meaning that they didn’t need approval: they were payments from the city and state governments that are given to any corporation that creates enough new jobs in parts of the city classified as “distressed.”

Mayor De Blasio, in a New York Times op-ed, offered suggestions for how Amazon could have undercut and divided their opponents: “Meet with organized labor. Start hiring public housing residents. Invest in infrastructure and other community needs. Show you care about fairness and creating opportunity for the working people of Long Island City.” De Blasio said he had offered the same advice privately to Amazon days earlier. Why didn’t Amazon listen to the mayor, and to all the lobbyists they hire to the tune of $14 million plus each year and who no doubt offered similar suggestions? Why instead did Amazon pull out of New York so abruptly?

Amazon is staging a capital strike. Just as workers can withhold their labor in return for concessions, so too can capitalists. Capitalists strike to force governments to create a “good investment climate.” By that capitalists mean low taxes on their corporations and on them individually, and cuts in regulations. They also want governments to weaken or ban unions.

Most often when we think about capital strikes we look at cases directed against leftist governments in weak and poor countries of the Global South. Capitalists stopped investing in Venezuela the minute Hugo Chavez became president, as they did in Chile under Salvador Allende. However, capital strikes also are used to extract specific concessions from governments in richer and more stable countries. After the 2008 financial crisis, banks held back on lending to non-financial firms until governments in Europe and the United States agreed to not impose stricter regulations on finance.

Amazon also unleashed a capital strike on its home city of Seattle. In 2018, the Seattle City Council unanimously passed a $275 per employee annual tax on business with over $20 million in revenues to fund construction of apartments and shelters for that city’s ever-growing homeless population. Amazon responded by immediately suspending construction on a new office complex in Seattle. Amazon explicitly said it would not resume investment in Seattle until the tax was repealed. Faced with Amazon’s capital strike, the Seattle City Council quickly repealed the tax.
"Within the confines of neoliberal politics we have no choice but to surrender to capital strikes. But if we change the rules under which capitalists and the working-class majority live, we can defeat capital strikes and decide for ourselves how the fruits of our work will be invested."

Seattle’s mayor, in a perfect expression of neoliberal thought, reported that Amazon and other companies would find non-monetary ways to address homelessness. “What we’ve heard from company to company as I’m talking to them is, ‘Tap us for our know-how . . . We have some of the most talented people on the globe right here in Seattle [who can provide] data analytics, dashboards, applications and software for the city’” to address homelessness. She likened such promised apps to the ones wealthier people use to book hotel rooms around the world. Of course no app can close the chasm between the tens of thousands of homeless in Seattle and the far fewer housing units available.

The same dynamic occurs in other cities, most notably San Francisco, where growing and wealthy corporations draw in numerous well-paid workers who can outbid poorer people for a stagnant or very slowly expanding pool of housing units. A similar outcome would have been inevitable if Amazon had brought twenty-five thousand highly paid employees to Long Island City, which is one of the few places in New York City where people of low and middle incomes can still afford to rent apartments.

Amazon’s capital strike in New York is unusual in that it wasn’t aimed at repealing a tax, winning a specific concession, or undoing a set of regulations. Instead Amazon just wanted to teach a lesson. Amazon sought to demonstrate that it would never recognize unions, nor would it make unionization or even neutrality to unionization a subject for negotiation with any city, state, or nation that wants to attract Amazon facilities.

We don’t yet know all the details of Amazon’s back-and-forth with New York public officials, let alone its internal deliberations, and thanks to corporate and government secrecy we may never know all. But we do know that Amazon has a long, unbroken record of total hostility toward unions. Amazon’s profits depend on its ability to ship goods at ever-lower cost so that it can undercut brick and mortar stores. Amazon accomplishes this by paying their warehouse workers as close to minimum wage as possible and even more by imposing a pace of work that injures employees who work in dangerously hot or cold buildings.

Unions negotiate and strike for better working conditions as well as higher wages. If Amazon workers were able to unionize, that corporation’s profits would be slashed. So even though the highly paid executives and technicians Amazon employed in New York probably never would have joined a union, the few construction and support workers employed in building and maintaining the new campus would have had reason to unionize. Those workers would have enjoyed the support of New York public officials who were demanding that Amazon facilitate or remain neutral in union drives in the city.

The financial cost of a few hundred unionized workers in New York would have been trivial in relation to Amazon profits. But the precedent and the resulting challenge to Amazon’s no-union business model would have been transformative. That is what Amazon moved to block with its sudden withdrawal from New York.

Most capital strikes are effective. Governments back down and do whatever capitalists demand in return for a resumption of investment. President Obama, despite his campaign promises and widespread public rage against the bankers who caused the 2008 financial crisis and resulting Great Recession, caved almost entirely in the face of the capital strike. Few regulations were imposed on banks and those that were enacted contained mechanisms allowing financial firms to lobby for revisions further undercutting those rules.

Since Amazon isn’t making a demand in this case but instead is just warning future governments and communities against insisting on the right for Amazon workers to unionize, the consequences will depend on how ordinary people interpret and react to this episode. Already media outlets, public officials and other businesses are denouncing the activists (especially Alexandria Ocasio-Cortez) who opposed New York’s deal with Amazon. As long as we leave investment decisions and workers’ rights in the hands of for-profit corporations, then the space for capital strikes will continue to expand.

The only alternative to giving in again and again to capitalists’ demands is to legislate national and eventually global limits on corporations’ freedom to make investment and employment decisions. If the minimum wage is raised to a truly living wage, then corporations will no longer be able to get workers and localities to bid against each other to attract jobs in return for lower wages. We need to strengthen occupational health and safety laws and regulations and beef up the Occupational Safety and Health Administration (OSHA)’s enforcement capacity.

Most importantly, we need to move control over investment decisions away from private capitalists and corporations to public entities that respond to mass needs and demands. There are various ways to do that. Elizabeth Warren is proposing an Accountable Capitalism Act that would require corporations with over $1 billion in annual revenue to obtain a federal charter (eliminating their ability to play states against each other) and to allocate at least 40 percent of board seats to workers. Such a model has been used for decades in Germany, the Netherlands, and the Scandinavian countries. That would be a significant first step. Bernie Sanders takes a different approach, focusing on making it easier for workers to unionize and expanding employee-owned enterprises.

But we should go further. If we were to raise tax rates on the rich and corporations  back to the levels of the 1940s and 1950s, as Sanders and Alexandria Ocasio-Cortez propose, and impose a wealth tax, as Warren suggests, enough revenue would be realized so that the government could become the dominant investor. Funds could be used for a Green New Deal, to provide free education from preschool through university for all, and other projects that ordinary people rather than capitalists deem worthwhile. Investments would be made with the goal of enhancing everyone’s quality of life and the future of our planet, not for further enriching the already obscenely rich.

Within the confines of neoliberal politics and economics we have no choice but to surrender to capital strikes. But if we change the rules under which capitalists and the working-class majority live, we can defeat capital strikes and decide for ourselves how the fruits of our work will be invested. First we need to realize we have an actual choice. Then we need to mobilize to make others aware of the possibilities to transcend the grim options and non-negotiable demands that Amazon made last week in New York and that Amazon and other corporations will continue to make in the future.

About the Author

Richard Lachmann is professor of sociology at the University at Albany, State University of New York.
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Offline RE

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Big Surprise!  Most people would vote to give the tax breaks to themselves!  ::)

How would that incentivize Bozos to plop Amazon2 in Queens though?  ???  :icon_scratch:


Alexandria Ocasio-Cortez says that $3 billion in tax credits should be given to the public, not Amazon — and a new poll shows that nearly half of Americans agree

Dennis Green and Walt Hickey

Alexandria Ocasio-Cortez Rep. Alexandria Ocasio-Cortez has been outspoken about Amazon's New York HQ2 deal, which has been canceled. Getty/Alex Wong

    Amazon backed out of a deal on February 14 to develop part of its second headquarters — known as HQ2— in New York City in exchange for a total of $3 billion in tax breaks it would receive over 10 years.
    The company cited resistance from state and local politicians as the reason behind its rethinking of the deal.
    A new INSIDER poll revealed that most respondents believe there are better uses for $3 billion in tax breaks than giving it all to one company for development.
    The most popular use among respondents, by far, was for the tax breaks to go to residents.
    It's an idea that has also been supported by Rep. Alexandria Ocasio-Cortez.

Amazon stunned onlookers on February 14 when it announced it was canceling its New York HQ2 project before it ever got off the ground.

The company backed out of a deal to put part of its second headquarters — known as HQ2 — in New York City in exchange for a total of $3 billion in tax breaks it would receive over 10 years. The company cited resistance from state and local politicians as the reason behind its rethinking of the deal.

A few polls, such as ones by INSIDER, Siena College, and HarrisX (sponsored by Amazon), mostly showed public support for Amazon coming to Queens, but responses were split when specific aspects of the deal — such as the $3 billion figure — were mentioned.

Read more: Most Americans want Amazon's HQ2 to come to their city

A new INSIDER poll conducted on SurveyMonkey Audience may help explain why. The poll asked 1,117 respondents what the best use of $3 billion in tax credits would be: giving it to one large company to open a large corporate office, to several mid-size companies to open offices, to existing businesses in the area for growth, or to residents in the area to encourage spending.
AmazonAn Amazon office entrance in New York City. AP/Mark Lennihan

The style of deal that was negotiated between Amazon and New York — $3 billion in tax credits for a new large office — carried only about 4% of the vote in the INSIDER poll. It was the least popular of all responses, including "I don't know," which earned just over 12% of votes.

By far, the most popular response supported giving tax credits to residents, which took the lion's share of the vote at more than 45%. Next was giving them to existing businesses, with over 20%. And giving the credits to mid-size companies received 18% of the vote. The poll had a margin of error of about 3 percentage points. Those results held steady regardless of whether the respondent said they lived in an urban, rural, or suburban area.

There were some differences between how more liberal and more conservative respondents would allocate the tax credits, but they did not change the results materially.

Conservative respondents were slightly more game than liberals to give a single large company a $3 billion welcome mat, but still, only 7% of moderately or very conservative respondents favored that option.

Tax credits for existing businesses remained flatly popular across the board, with one in five thinking that would be the best option. Moderately or very liberal respondents favored giving tax credits to residents by a gap of eight percentage points over their conservative counterparts, who favored giving credits to several new mid-size businesses by five percentage points.

Altogether, though, the issue transcended politics: A small fraction of respondents think the best use of that kind of tax credit is to one major company.
Long Island CityLong Island City, Queens. AP/Mark Lennihan

Not even people who strongly supported the Amazon deal seemed to believe that giving tax credits to a major company would be the best overall choice. Later in the survey, we presented the gist of the Amazon arrangement: $3 billion in tax credits for 25,000 jobs in a new headquarters.

Of those who strongly supported that deal, only 10% thought one major company was the best beneficiary of such a tax credit when presented with other options.

Meanwhile, 40% said residents would be the best recipient, 26% said several mid-size companies, and 19% said existing businesses.

What's clear is that given the option for giving $3 billion in tax credits, people would rather see pretty much anything other than a deal that looks similar to the one New York made — and then canceled — with Amazon. That polling supports Rep. Alexandria Ocasio-Cortez's stance that $3 billion in incentives should be used in other ways.

"It's fair to ask why we don't invest the capital for public use, + why we don't give working people a tax break," Ocasio-Cortez said in a series of tweets on Tuesday night.

She previously suggested the cash could be put to better use than given in tax credits. The idea was dismissed as "nonsense" by some on Twitter who assumed she didn't understand how these credits work.

    SurveyMonkey Audience polls from a national sample balanced by census data of age and gender. Respondents are incentivized to complete surveys through charitable contributions. Generally speaking, digital polling tends to skew toward people with access to the internet. SurveyMonkey Audience doesn't try to weight its sample based on race or income. Total 1,117 respondents collected February 15 to 16, 2019, a margin of error plus or minus 3.07 percentage points with a 95% confidence level.
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🤑 Capitalism Has Failed—What Next?
« Reply #65 on: February 23, 2019, 03:04:57 AM »

John Bellamy Foster: Capitalism Has Failed—What Next?
Print Friendly, PDF & EmailPrint this post.

byJohn Bellamy Foster, Monthly Review

Dateline Feb 01, 2019

“Capitalism Isn’t Working.” Photo credit: Jonny White / Creative Commons.

Less than two decades into the twenty-first century, it is evident that capitalism has failed as a social system. The world is mired in economic stagnation, financialization, and the most extreme inequality in human history, accompanied by mass unemployment and underemployment, precariousness, poverty, hunger, wasted output and lives, and what at this point can only be called a planetary ecological “death spiral.”1 The digital revolution, the greatest technological advance of our time, has rapidly mutated from a promise of free communication and liberated production into new means of surveillance, control, and displacement of the working population. The institutions of liberal democracy are at the point of collapse, while fascism, the rear guard of the capitalist system, is again on the march, along with patriarchy, racism, imperialism, and war.

To say that capitalism is a failed system is not, of course, to suggest that its breakdown and disintegration is imminent.2 It does, however, mean that it has passed from being a historically necessary and creative system at its inception to being a historically unnecessary and destructive one in the present century. Today, more than ever, the world is faced with the epochal choice between “the revolutionary reconstitution of society at large and the common ruin of the contending classes.”3

Indications of this failure of capitalism are everywhere. Stagnation of investment punctuated by bubbles of financial expansion, which then inevitably burst, now characterizes the so-called free market.4 Soaring inequality in income and wealth has its counterpart in the declining material circumstances of a majority of the population. Real wages for most workers in the United States have barely budged in forty years despite steadily rising productivity.5 Work intensity has increased, while work and safety protections on the job have been systematically jettisoned. Unemployment data has become more and more meaningless due to a new institutionalized underemployment in the form of contract labor in the gig economy.6 Unions have been reduced to mere shadows of their former glory as capitalism has asserted totalitarian control over workplaces. With the demise of Soviet-type societies, social democracy in Europe has perished in the new atmosphere of “liberated capitalism.”7

The capture of the surplus value produced by overexploited populations in the poorest regions of the world, via the global labor arbitrage instituted by multinational corporations, is leading to an unprecedented amassing of financial wealth at the center of the world economy and relative poverty in the periphery.8 Around $21 trillion of offshore funds are currently lodged in tax havens on islands mostly in the Caribbean, constituting “the fortified refuge of Big Finance.”9 Technologically driven monopolies resulting from the global-communications revolution, together with the rise to dominance of Wall Street-based financial capital geared to speculative asset creation, have further contributed to the riches of today’s “1 percent.” Forty-two billionaires now enjoy as much wealth as half the world’s population, while the three richest men in the United States—Jeff Bezos, Bill Gates, and Warren Buffett—have more wealth than half the U.S. population.10 In every region of the world, inequality has increased sharply in recent decades.11 The gap in per capita income and wealth between the richest and poorest nations, which has been the dominant trend for centuries, is rapidly widening once again.12 More than 60 percent of the world’s employed population, some two billion people, now work in the impoverished informal sector, forming a massive global proletariat. The global reserve army of labor is some 70 percent larger than the active labor army of formally employed workers.13

Adequate health care, housing, education, and clean water and air are increasingly out of reach for large sections of the population, even in wealthy countries in North America and Europe, while transportation is becoming more difficult in the United States and many other countries due to irrationally high levels of dependency on the automobile and disinvestment in public transportation. Urban structures are more and more characterized by gentrification and segregation, with cities becoming the playthings of the well-to-do while marginalized populations are shunted aside. About half a million people, most of them children, are homeless on any given night in the United States.14 New York City is experiencing a major rat infestation, attributed to warming temperatures, mirroring trends around the world.15

In the United States and other high-income countries, life expectancy is in decline, with a remarkable resurgence of Victorian illnesses related to poverty and exploitation. In Britain, gout, scarlet fever, whooping cough, and even scurvy are now resurgent, along with tuberculosis. With inadequate enforcement of work health and safety regulations, black lung disease has returned with a vengeance in U.S. coal country.16 Overuse of antibiotics, particularly by capitalist agribusiness, is leading to an antibiotic-resistance crisis, with the dangerous growth of superbugs generating increasing numbers of deaths, which by mid–century could surpass annual cancer deaths, prompting the World Health Organization to declare a “global health emergency.”17 These dire conditions, arising from the workings of the system, are consistent with what Frederick Engels, in the Condition of the Working Class in England, called “social murder.”18

At the instigation of giant corporations, philanthrocapitalist foundations, and neoliberal governments, public education has been restructured around corporate-designed testing based on the implementation of robotic common-core standards. This is generating massive databases on the student population, much of which are now being surreptitiously marketed and sold.19 The corporatization and privatization of education is feeding the progressive subordination of children’s needs to the cash nexus of the commodity market. We are thus seeing a dramatic return of Thomas Gradgrind’s and Mr. M’Choakumchild’s crass utilitarian philosophy dramatized in Charles Dickens’s Hard Times: “Facts are alone wanted in life” and “You are never to fancy.”20 Having been reduced to intellectual dungeons, many of the poorest, most racially segregated schools in the United States are mere pipelines for prisons or the military.21

More than two million people in the United States are behind bars, a higher rate of incarceration than any other country in the world, constituting a new Jim Crow. The total population in prison is nearly equal to the number of people in Houston, Texas, the fourth largest U.S. city. African Americans and Latinos make up 56 percent of those incarcerated, while constituting only about 32 percent of the U.S. population. Nearly 50 percent of American adults, and a much higher percentage among African Americans and Native Americans, have an immediate family member who has spent or is currently spending time behind bars. Both black men and Native American men in the United States are nearly three times, Hispanic men nearly two times, more likely to die of police shootings than white men.22 Racial divides are now widening across the entire planet.

Violence against women and the expropriation of their unpaid labor, as well as the higher level of exploitation of their paid labor, are integral to the way in which power is organized in capitalist society—and how it seeks to divide rather than unify the population. More than a third of women worldwide have experienced physical/sexual violence. Women’s bodies, in particular, are objectified, reified, and commodified as part of the normal workings of monopoly-capitalist marketing.23

The mass media-propaganda system, part of the larger corporate matrix, is now merging into a social media-based propaganda system that is more porous and seemingly anarchic, but more universal and more than ever favoring money and power. Utilizing modern marketing and surveillance techniques, which now dominate all digital interactions, vested interests are able to tailor their messages, largely unchecked, to individuals and their social networks, creating concerns about “fake news” on all sides.24 Numerous business entities promising technological manipulation of voters in countries across the world have now surfaced, auctioning off their services to the highest bidders.25 The elimination of net neutrality in the United States means further concentration, centralization, and control over the entire Internet by monopolistic service providers.

Elections are increasingly prey to unregulated “dark money” emanating from the coffers of corporations and the billionaire class. Although presenting itself as the world’s leading democracy, the United States, as Paul Baran and Paul Sweezy stated in Monopoly Capital in 1966, “is democratic in form and plutocratic in content.”26 In the Trump administration, following a long-established tradition, 72 percent of those appointed to the cabinet have come from the higher corporate echelons, while others have been drawn from the military.27

War, engineered by the United States and other major powers at the apex of the system, has become perpetual in strategic oil regions such as the Middle East, and threatens to escalate into a global thermonuclear exchange. During the Obama administration, the United States was engaged in wars/bombings in seven different countries—Afghanistan, Iraq, Syria, Libya, Yemen, Somalia, and Pakistan.28 Torture and assassinations have been reinstituted by Washington as acceptable instruments of war against those now innumerable individuals, group networks, and whole societies that are branded as terrorist. A new Cold War and nuclear arms race is in the making between the United States and Russia, while Washington is seeking to place road blocks to the continued rise of China. The Trump administration has created a new space force as a separate branch of the military in an attempt to ensure U.S. dominance in the militarization of space. Sounding the alarm on the increasing dangers of a nuclear war and of climate destabilization, the distinguished Bulletin of Atomic Scientists moved its doomsday clock in 2018 to two minutes to midnight, the closest since 1953, when it marked the advent of thermonuclear weapons.29

Increasingly severe economic sanctions are being imposed by the United States on countries like Venezuela and Nicaragua, despite their democratic elections—or because of them. Trade and currency wars are being actively promoted by core states, while racist barriers against immigration continue to be erected in Europe and the United States as some 60 million refugees and internally displaced peoples flee devastated environments. Migrant populations worldwide have risen to 250 million, with those residing in high-income countries constituting more than 14 percent of the populations of those countries, up from less than 10 percent in 2000. Meanwhile, ruling circles and wealthy countries seek to wall off islands of power and privilege from the mass of humanity, who are to be left to their fate.30

More than three-quarters of a billion people, over 10 percent of the world population, are chronically malnourished.31 Food stress in the United States keeps climbing, leading to the rapid growth of cheap dollar stores selling poor quality and toxic food. Around forty million Americans, representing one out of eight households, including nearly thirteen million children, are food insecure.32 Subsistence farmers are being pushed off their lands by agribusiness, private capital, and sovereign wealth funds in a global depeasantization process that constitutes the greatest movement of people in history.33 Urban overcrowding and poverty across much of the globe is so severe that one can now reasonably refer to a “planet of slums.”34 Meanwhile, the world housing market is estimated to be worth up to $163 trillion (as compared to the value of gold mined over all recorded history, estimated at $7.5 trillion).35

The Anthropocene epoch, first ushered in by the Great Acceleration of the world economy immediately after the Second World War, has generated enormous rifts in planetary boundaries, extending from climate change to ocean acidification, to the sixth extinction, to disruption of the global nitrogen and phosphorus cycles, to the loss of freshwater, to the disappearance of forests, to widespread toxic-chemical and radioactive pollution.36 It is now estimated that 60 percent of the world’s wildlife vertebrate population (including mammals, reptiles, amphibians, birds, and fish) have been wiped out since 1970, while the worldwide abundance of invertebrates has declined by 45 percent in recent decades.37 What climatologist James Hansen calls the “species exterminations” resulting from accelerating climate change and rapidly shifting climate zones are only compounding this general process of biodiversity loss. Biologists expect that half of all species will be facing extinction by the end of the century.38

If present climate-change trends continue, the “global carbon budget” associated with a 2°C increase in average global temperature will be broken in sixteen years (while a 1.5°C increase in global average temperature—staying beneath which is the key to long-term stabilization of the climate—will be reached in a decade). Earth System scientists warn that the world is now perilously close to a Hothouse Earth, in which catastrophic climate change will be locked in and irreversible.39 The ecological, social, and economic costs to humanity of continuing to increase carbon emissions by 2.0 percent a year as in recent decades (rising in 2018 by 2.7 percent—3.4 percent in the United States), and failing to meet the minimal 3.0 percent annual reductions in emissions currently needed to avoid a catastrophic destabilization of the earth’s energy balance, are simply incalculable.40
“For many people on the left, the answer to neoliberalism or disaster capitalism is a return to welfare-state liberalism, market regulation, or some form of limited social democracy, and thus to a more rational capitalism. It is not the failure of capitalism itself that is perceived as the problem, but rather the failure of neoliberal capitalism…”

Nevertheless, major energy corporations continue to lie about climate change, promoting and bankrolling climate denialism—while admitting the truth in their internal documents. These corporations are working to accelerate the extraction and production of fossil fuels, including the dirtiest, most greenhouse gas-generating varieties, reaping enormous profits in the process. The melting of the Arctic ice from global warming is seen by capital as a new El Dorado, opening up massive additional oil and gas reserves to be exploited without regard to the consequences for the earth’s climate. In response to scientific reports on climate change, Exxon Mobil declared that it intends to extract and sell all of the fossil-fuel reserves at its disposal.41 Energy corporations continue to intervene in climate negotiations to ensure that any agreements to limit carbon emissions are defanged. Capitalist countries across the board are putting the accumulation of wealth for a few above combatting climate destabilization, threatening the very future of humanity.

Capitalism is best understood as a competitive class-based mode of production and exchange geared to the accumulation of capital through the exploitation of workers’ labor power and the private appropriation of surplus value (value generated beyond the costs of the workers’ own reproduction). The mode of economic accounting intrinsic to capitalism designates as a value-generating good or service anything that passes through the market and therefore produces income. It follows that the greater part of the social and environmental costs of production outside the market are excluded in this form of valuation and are treated as mere negative “externalities,” unrelated to the capitalist economy itself—whether in terms of the shortening and degradation of human life or the destruction of the natural environment. As environmental economist K. William Kapp stated, “capitalism must be regarded as an economy of unpaid costs.”42

We have now reached a point in the twenty-first century in which the externalities of this irrational system, such as the costs of war, the depletion of natural resources, the waste of human lives, and the disruption of the planetary environment, now far exceed any future economic benefits that capitalism offers to society as a whole. The accumulation of capital and the amassing of wealth are increasingly occurring at the expense of an irrevocable rift in the social and environmental conditions governing human life on earth.43

Some would argue that China stands as an exception to much of the above, characterized as it is by a seemingly unstoppable rate of economic advance (though carrying with it deep social and ecological contradictions). Yet Chinese development has its roots in the 1949 Chinese Revolution, carried out by the Chinese Communist Party headed by Mao Zedong, whereby it liberated itself from the imperialist system. This allowed it to develop for decades under a planned economy largely free of constraints from outside forces, establishing a strong agricultural and industrial economic base. This was followed by a shift in the post-Maoist reform period to a hybrid system of more limited state planning along with a much greater reliance on market relations (and a vast expansion of debt and speculation) under conditions—the globalization of the world market—that were particularly fortuitous to its “catching up.” Through trade wars and other pressures aimed at destabilizing China’s position in the world market, the United States is already seeking to challenge the bases of China’s growth in world trade. China, therefore, stands not so much for the successes of late capitalism but rather for its inherent limitations. The current Chinese model, moreover, carries within it many of the destructive tendencies of the system of capital accumulation. Ultimately, China’s future too depends on a return to the process of revolutionary transition, spurred by its own population.44

How did these disastrous conditions characterizing capitalism worldwide develop? An understanding of the failure of capitalism, beginning in the twentieth century, requires a historical examination of the rise of neoliberalism, and how this has only served to increase the destructiveness of the system. Only then can we address the future of humanity in the twenty-first century.

Neoliberalism and Capitalist Failure

Many of the symptoms of the failure of capitalism described above are well-known. Nevertheless, they are often attributed not to capitalism as a system, but simply to neoliberalism, viewed as a particular paradigm of capitalist development that can be replaced by another, better one. For many people on the left, the answer to neoliberalism or disaster capitalism is a return to welfare-state liberalism, market regulation, or some form of limited social democracy, and thus to a more rational capitalism. It is not the failure of capitalism itself that is perceived as the problem, but rather the failure of neoliberal capitalism.

In contrast, the Marxian tradition understands neoliberalism as an inherent outgrowth of late capitalism, associated with the domination of monopoly-finance capital. A critical-historical analysis of neoliberalism is therefore crucial both to grounding our understanding of capitalism today and uncovering the reason why all alternatives to neoliberalism and its capitalist absolutism are closed within the system itself.
Born to Jewish parents in Lemberg (today’s Lviv in Ukraine), Mises emigrated from Austria to the United States in 1940. Since the mid-20th century, the libertarian movement in the United States has been strongly influenced by Mises’s writings. Mises’s student Friedrich Hayek viewed Mises as one of the major figures in the revival of liberalism in the post-war era.

The term neoliberalism had its origin in the early 1920s, in the Marxian critique of Ludwig von Mises’s Nation, State, and Economy (1919) and Socialism: An Economic and Sociological Analysis (1922), both of which were written as virulent anti-socialist tracts, constituting the foundational works of neoliberal-capitalist ideology.45 In these works, Mises, then employed by the Vienna Chamber of Commerce, insisted that the “old liberalism” had to be “relaid” in such a way as to defeat socialism. In the process, he equated socialism with “destructionism,” insisted that monopoly was consistent with capitalist free competition, defended unlimited inequality, and argued that consumers exercised “democracy” through their purchases, which were equivalent to ballots. He strongly condemned labor legislation, compulsory social insurance, trade unions, unemployment insurance, socialization (or nationalization), taxation, and inflation as the enemies of his refurbished liberalism.46 So extreme were Mises’s neoliberal views that he explicitly took the side of the crass, utilitarian pedagogue M’Choakumchild against the defiant young heroine Sissy Jupe, as portrayed by Dickens in Hard Times. Dickens, Mises claimed, had “taught millions to hate Liberalism and Capitalism.”47

In 1921, Austro-Marxist Max Adler coined the term neoliberalism to designate Mises’s attempt to refurbish a fading liberal order through a new ideology of market fetishism. This was followed by a sharp criticism of Mises’s neoliberal ideology in 1923 by the gifted Austro-Marxist Helene Bauer. In 1924, the German Marxist Alfred Meusel wrote a lengthy critique of Mises, entitled “Neoliberalism” (“Der Neu-Liberalismus”) for the leading German socialist theoretical journal Die Gesellschaft, edited by Rudolf Hilferding.48

Building on a wealth of Marxian analysis, Adler, Bauer, and Meusel attacked Mises’s claim that an unregulated capitalism was the only rational economic system and that socialism was equivalent to destructionism. They strongly challenged his ahistorical depiction of a harmonious capitalism that promoted free exchange and free trade through the market mechanism. A serious logical flaw in Mises’s analysis, they contended, was the systematic bifurcation built into his neoliberal ideology, whereby trade unions were considered constraints on trade while employers’ associations and monopolistic corporations were justified as consistent with free competition. Likewise, it was noted that Mises advocated a strong state to repress working-class struggles in the name of a self-regulating market system, even when state action on behalf of workers was condemned as anti-free market and a form of class terror. For Meusel, Mises was “a faithful servant of the mobile capitalist” or international finance capital. Later, in 1926, the protofascist economist Othmar Spann criticized the atavistic attempt to revert to a more extreme version of classical liberalism, referring to this in his Types of Economic Theory as “The Neo-Liberal Trend.”49 In 1927, in his work Liberalism, Mises himself distinguished between “the older liberalism and…neoliberalism” on the basis of the commitment of the former to equality, in contrast to the rejection of equality (other than so-called equality of opportunity) by the latter.50

Neoliberalism, as it first emerged from Mises’s pen, was thus viewed by Marxian critics in the 1920s (and even by some figures on the right) as an attempt to rationalize a monopoly or finance capital far removed from the precepts of classical liberalism. It was designed to provide the intellectual basis for capitalist class warfare against not only socialism, but all attempts at social regulation and social democracy: a no-quarter-given attack on the working class.

Mises’s assault on socialism, together with that of his protégé Friedrich Hayek, was motivated in part by a profound disenchantment with Red Vienna under the sway of Austro-Marxism, which was inspired by figures like Adler, Otto Bauer, and Karl Renner.51 Conversely, it was this same political environment of Red Vienna, which dominated Austrian politics from 1919–32, that inspired Karl Polanyi, who was strongly influenced by Adler and Otto Bauer, to develop a crushing critique of the neoliberal belief in the self-regulating market—later to form the basis of The Great Transformation (1946).52

In the 1930s to 1960s, following the Great Depression and the Second World War, neoliberal ideology waned in the context of the deepening crisis of capitalism. In the early 1930s, as the storm clouds gathered over Europe, Mises served as an economic advisor to Austrofascist Chancellor-dictator Engelbert Dollfuss prior to the Nazi takeover of Austria.53 He later emigrated to Switzerland and then to the United States, enjoying the support of the Rockefeller Foundation and teaching at New York University. Meanwhile, Hayek was recruited by the London School of Economics at the instigation of the early neoliberal British economist Lionel Robbins.

The post-Second World War years in the West were known as the age of Keynes. Spurred on by increased state spending (particularly on the military in the context of the Cold War), the rebuilding of the war-torn European and Japanese economies, the expansion of the sales effort, waves of automobilization in both the United States and Europe, and two major regional wars in Asia—capitalist economies grew rapidly for a quarter-century.54 Meanwhile, faced with the threat of the alternative model represented by the Soviet Union, and the advent of strong unions as a result of the developments of the 1930s and ’40s, the West moved in the direction of Keynesianism, social democracy, and the welfare state.

Nevertheless, the tendency toward economic stagnation already exhibited in the 1930s remained as a structural flaw of the system, temporarily masked by the so-called Golden Age of rapid growth and increasing income for workers that immediately followed the Second World War. The giant corporations of monopoly capitalism succeeded in appropriating ever-greater surplus in both absolute and relative terms, which was concentrated in the hands of ever-fewer wealth holders, leading to a tendency toward overaccumulation of capital and manufacturing overcapacity, countered in part by a massive expansion of the sales effort, militarism, and imperialism, but with ever-lessening effect in stimulating the economy.

U.S. imperialism and the proliferation of dollars abroad led to a breakdown in the Bretton Woods system that had stabilized world trade in the early post-Second World War period, causing Richard Nixon to end the dollar-gold standard in 1971. This was associated with a slowdown in the U.S. economy from the late 1960s on, as the Vietnam War was winding down, resulting in a structural crisis of the capitalist system in the mid–1970s, which was to mark the beginning of decades of economic stagnation and a long decline in the trend rate of growth in the advanced capitalist economies. The major stimuli that sparked the post-Second World War boom had all waned, leaving the advanced capitalist economies in the doldrums.55

The first response to the structural crisis of the capitalist system that emerged in the 1970s was to utilize Keynesian demand-promotion to expand state spending. U.S. civilian-government spending on goods and services as a percentage of gross domestic product thus reached a peak during the Nixon administration.56 This, plus the struggles of unions to maintain their real wages in the crisis, while monopolistic corporations aggressively raised prices to increase their profit margins, led to a period of stagflation (economic stagnation plus inflation).

Inflation, which depreciates accumulated wealth held in the form of monetary assets, is a much greater immediate threat to the position of the capitalist class than is economic stagnation, while for the working class the situation is reversed. The result was the emergence of an anti-Keynesian movement within the capitalist class, which designated anything to the left of hardcore neoliberalism as socialist or totalitarian in the manner of Hayek’s Road to Serfdom, and sought to reverse decades of modest working-class gains.57 There was a sharp turn toward austerity and economic restructuring, initially under the guise of monetarism and supply-side economics, and later taking a more amorphous free-market character. A concerted effort to destroy unions by combined political, economic, and juridical means was carried out, eliminating what John Kenneth Galbraith in his American Capitalism had once called the “countervailing power” of labor.58

Key to the reemergence of neoliberalism in the post-Second World period was the Mont Pèlerin Society, named after the Swiss spa where Mises, Hayek, Robbins, Milton Friedman, George Stigler, Raymond Aron, and others met in 1947, to promote neoliberal economic and political ideas. The members of the Mont Pèlerin Society generally referred to themselves as classical liberals in the European sense. No doubt remembering the devastating Marxist critiques of neoliberal ideology in the 1920s, they eschewed the label neoliberal, which Mises himself had adopted in 1927, and which had been put forward in the 1938 Walter Lippmann Colloquium in Paris that Mises and Hayek attended.59 Instead, neoliberalism was presented by its chief adherents in the Mont Pèlerin Society not as a separate political ideology from, but as an extension of, classical liberalism and attributable to inherent features of human nature. In this way, as Michel Foucault argued, it was converted into a kind of biopolitics.60

Nevertheless, while abandoning the neoliberal label, the Mont Pèlerin Society, together with the Department of Economics at the University of Chicago, was to be a bastion of neoliberal ideology—in precisely the sense that it had first emerged between the world wars. In the Keynesian era of the 1950s and ’60s, figures like Mises, Hayek, Friedman, and James Buchanan remained on the margins, though heavily bankrolled by private foundations.61 But with the return of economic stagnation in the 1970s, neoliberal intellectuals were actively recruited at the apex of monopoly capital in order to provide the ideological basis for an ongoing corporate campaign to restructure the capitalist economy, deliberately targeting labor, the state, and the underdeveloped economies of the global South.

Central to neoliberal philosophy from the beginning was the defense of concentrated corporate capital and class dynasties, which were portrayed as representing free-market competition and entrepreneurship.62 The very virulence of neoliberal anti-socialism meant that it represented the drive to a complete market-privatization of social life. In Margaret Thatcher’s London and Ronald Reagan’s Washington, figures like Hayek and Friedman became the symbols of the neoliberal era, sometimes called the age of Hayek. The new so-called Nobel Prize in Economics, or the Sveriges Riksbank (Bank of Sweden) Prize in Economic Sciences in Memory of Alfred Nobel, established by the Bank of Sweden in 1969, was controlled from its inception by ultraconservative neoliberal economists. Seven members of the Mont Pèlerin Society, including Hayek, Friedman, Stigler, and Buchanan received the prize between 1974 and 1992, while even mildly social-democratic economists were all but excluded.63

Neoliberalism as an economic ideology was largely ineffectual in normal economic-policy terms, judged by its lack of success in promoting growth, since, like neoclassical economics itself, it sought to deny (or rationalize) the reality of an economy dominated by big business and concentrated power.64 Nevertheless, it served as an effective political-economic strategy for big business and the emerging billionaire class in an age where monopoly-finance capital sought to seize control of all monetary flows in society.65 Although capitalist economies continued to stagnate with growth rates diminishing decade by decade, the surplus capital in the hands of the corporate rich not only increased, but by virtue of financialization, globalization, and the revolution in digital technology, new forms of amassing wealth were created.66 Financialization—the relative shift of the economy from production to finance—opened up vast new avenues to speculation and wealth formation, relatively removed from capital investment in new productive capacity (that is, real capital accumulation).

Globalization meant not only new markets, but, more importantly—through the global labor arbitrage—the appropriation of huge economic surpluses from the overexploitation of low-wage labor in the periphery that ended up in the financial coffers of multinational corporations and wealthy individuals in the rich countries.67 The benefits of imperialism to workers in the center of the capitalist economy no longer included incremental gains in employment and income associated with the global dominance of production, but, at best, could be said to contribute to cheaper prices from the outsourcing of production by multinational corporations, symbolized by the growth of Walmart. Meanwhile, digital technology created the basis of a new globalized surveillance capitalism, buying and selling information on the population, primarily motivated by the sales effort, leading to the creation of enormous information-technology monopolies.68

Vast increases in inequality and wealth were justified as returns for innovation, always attributed to a very few rather than as the collective product of society. In the new era of expropriation, all was up for grabs: education, health systems, transportation, housing, land, cities, prisons, insurance, pensions, food, entertainment. All exchanges in society were to be fully commodified, corporatized, and financialized, with the funds flowing into financial centers and feeding speculation on capital gains, leveraged by debt. Human communication was itself to be turned into a commodity. All in the name of a free-market society.

For the powers that be, this strategy was enormously successful. Capitalism, despite Adam Smith, had never been about the wealth of nations so much as the wealth of the capitalist class. The financialization process managed to counter economic-stagnation tendencies to some extent, but at the cost of periodic financial crises layered over the normal business cycle. Nevertheless, the amassing of wealth at the top continued to accelerate, with financial crises themselves leading to even greater financial concentration and centralization. In this situation, neoliberalism increasingly took on the logic of financialized expropriation and accumulation.

The state too became subject to the financialization policy, shifting its overall role to protecting the value of money.69 In the Great Financial Crisis of 2007–09, the big banks and corporations were almost all bailed out; the population was not. Rather than representing a severe crisis for neoliberalism itself, the Great Financial Crisis only gave it further impetus, reflecting the fact that neoliberal politics had become the ideological expression of an all-encompassing system of financial expropriation.70

A characteristic of this new era of financialized accumulation is that it is progressively removed from the realities of production and use value, heightening the conflict between exchange value (the value form) and use value (the natural form) within the overall production and accumulation process.71 The result is “a social and ecological planetary emergency.”72 This is most evident in the rapid destruction of the natural environment. Fossil fuels are entered as financial assets on the books of corporations, even when they exist only in the form of reserves buried in the ground. In this way, they are integral to the entire financialized accumulation process of monopoly capitalism. Trillions of dollars of Wall Street assets are thus tied up in fossil capital.73 This has made it doubly difficult to shift away from the extraction and use of fossil fuels to more sustainable alternatives, such as solar and wind power. No one owns the sun’s rays or the wind. Hence, there is less of a vested interest in these forms of energy. In today’s capitalism, more than ever before, current and potential future profits dictate all, at the expense of people and the planet. The human population stands by, seemingly helpless, watching the destruction of the climate and the loss of innumerable species, all imposed by the ostensibly overwhelming force of market society.

Neoliberalism has always been directly opposed to strict laissez faire since it has invariably emphasized a strong, interventionist, and constructionist relation to the state, in the direct service of private capital and market authoritarianism, or what James K. Galbraith has critically referred to as the predator state.74 In the neoliberal view, capitalist absolutism is not a spontaneous product—it must be created. The role of the state is not simply to protect property, as maintained by Smith, but, as Foucault brilliantly explained in his Birth of Biopolitics, extends to the active construction of the domination of the market over all aspects of life.75 This means refashioning the state and society on the model of the corporation or the market.

As Foucault put it, “the problem of neo-liberalism is…how the overall exercise of political power can be modeled on the principles of a market economy.” The state must not “correct the destructive effects of the market,” where these fall “on society” outside the market, but rather take advantage of these destructive effects to impose further measures that extend the reach and penetration of the market.76 The goal is not to transcend the state altogether, but to shackle it to the monopolistic-competitive ends of capital, a view forcefully propagated by Buchanan.77 The shackles imposed on the neoliberal state dominated by monopoly-finance capital are specially designed to limit any changes that would negatively affect the value of money. Hence, both fiscal and monetary policy are increasingly put out of reach of the government itself—in those cases where changes going against the vested interests are contemplated. Central banks have been transformed into largely autonomous branches of the state, in fact controlled by the banks. Treasury departments are shackled by debt ceilings. Regulatory agencies are captured by monopoly-finance capital and act, for the most part, in the direct interest of corporations outside governmental control.78

The result of such an attempt to construct a so-called self-regulating market society—in fact requiring constant state interventions on behalf of capital and the creation of a predator state—is, as Polanyi powerfully demonstrated, to undermine the very foundations of society and life itself.79 But, in terms of capitalism today, there is no going back. Stagnation, financialization, privatization, globalization, the marketization of the state, and the reduction of people to “human capital” and nature to “natural capital,” have made neoliberal politics an irrevocable characteristic of monopoly-finance capital, which only an anti-capitalist politics can supplant.

Neoliberalism has thus become integrated into the system in the context of the structural crisis of capitalism in its globalized monopoly-finance phase. It extends this structural crisis to all of society and makes it universal and insurmountable within the system. The answer to every failing of capitalism is thus to turn the screw further, which accounts for much of the allure of the market principle, since it is perpetually seen as the solution to the problems it causes—with each failure opening up new areas of profitability for a few. The result of this irrational logic is not merely economic and ecological disaster, but the gradual demise of the liberal-democratic state itself. Neoliberalism thus points inevitably to market authoritarianism and even neofascism. In this respect, Donald Trump is no mere aberration.80

As Mises openly declared in 1927 in Liberalism: “It cannot be denied that Fascism and similar movements [on the right] aiming at the establishment of dictatorships are full of the best intentions, and that their intervention, has, for the moment, saved European civilization. The merit that Fascism has thereby won for itself will live on eternally in history.”81 Hayek, along with other neoliberals such as Friedman and Buchanan, actively supported General Augusto Pinochet’s coup in Chile in 1973, overthrowing the democratically elected socialist government of Salvador Allende and imposing an economic shock doctrine on the population. In this context, Hayek, in a trip he took to Chile in 1978, personally warned Pinochet against a resurrection of “unlimited democracy.” During a second visit in 1981, he stated that “a dictatorship…may be more liberal in its policies than a democratic assembly.”82 As he wrote in 1949 in Individualism and Economic Order, “we must face the fact that the preservation of individual freedom is incompatible with a full satisfaction of our views of distributive justice.”83

Neoliberalism, in short, is not a mere paradigm that can be dispensed with, but represents the absolutist tendencies of the system in the age of monopoly finance. As Foucault pointed out, the “survival of capitalism” could only be ensured for a time by the singular application of its economic logic to all of sociological existence.84 Reduced, however, to a pure Midas principle, capitalism could only end up by destroying everything in existence with which it came into contact. But if capitalism has now failed, the question becomes: What next?

What Next?

In his magisterial The Age of Extremes: A History of the World 1914–1991, Marxist historian Eric Hobsbawm, viewing the approach of the twenty-first century, indicated that there were reasons to be concerned that the new century might be even more threatening to humanity than the “age of extremes” that had preceded it, a century that had been punctuated by world wars, imperial conflicts, and economic depressions—and in which humanity was confronted for the first time with the possibility of its own self-annihilation. Yet, looking forward, he concluded, the new century (and millennium) offered even greater dangers.

“We live in a world,” Hobsbawm observed in 1994,

    uprooted and transformed by the titanic economic and the techno-scientific process of the development of capitalism, which has dominated the past two or three centuries. We know, or at least it is reasonable to suppose, that it cannot go on ad infinitum. The future cannot be a continuation of the past, and there are signs, both externally, and, as it were, internally, that we have reached a point of historic crisis. The forces generated by the techno-scientific economy are now great enough to destroy the environment, that is to say, the material foundations of human life. The structures of human societies themselves, including even some of the social foundations of the capitalist economy, are on the point of being destroyed by the erosion of what we have inherited from the human past. Our world risks both explosion and implosion. It must change.

    We do not know where we are going. We only know that history has brought us to this point and—if readers share the argument of this book—why. However, one thing is plain. If humanity is to have a recognizable future, it cannot be by prolonging the past or the present. If we try to build the third millennium on that basis, we shall fail. And the price of failure, that is to say, the alternative to a changed society, is darkness.85

Hobsbawm left little doubt as to what the principal danger was at present, namely “the theological faith in an economy in which resources were allocated entirely by the totally unrestricted market, under conditions of unlimited competition,” carried out by evermore-concentrated corporations. Chief among the dangers of such a system was the likelihood of “irreversible and catastrophic consequences for the natural environment of this planet, including the human race which is part of it.”86

Hobsbawm’s position was roundly criticized at the time, even by many on the left, as overly “pessimistic” with regard to the course of capitalist development.87 Today, however, a quarter-century later, it is clear that he hit the mark, as the concerns that he voiced then are even more evident today. Nevertheless, such realism in approaching the failure of capitalism in our time is still rare on the part of left intellectuals in the wealthy countries, even in the face of decades of neoliberal assault combined with economic stagnation, financialization, growing inequality, and environmental decline. One common response is to refer to Polanyi’s notion of a double movement, in which the recurring myth of a self-regulating market society inevitably gives rise to defensive movements to protect society and the environment.88 This has fed the hope that the pendulum will swing back again, leading to a more affirmative-style liberalism or social democracy. This sustains the belief that the failures of unregulated capitalism can be countered by a return to regulated capitalism, a new Keynesian age—as if history had stood still.

Pinning hopes on a double movement of this kind, however, denies four material realities. First, social democracy came about and persisted only as long as the threat of actually existing socialist societies was present and union strength endured, and faded immediately with the demise of both. Second, neoliberalism today is ingrained in capitalism itself, in the phase of monopoly-financial capital. The earlier age of industrial-capital dominance, on which Keynesian economics was based, is now gone. Third, social democracy was in practice reliant on an imperialist system that was opposed to the interests of the vast majority of humankind. Fourth, the liberal-democratic state and the dominance of a purportedly enlightened industrial-capitalist class willing to engage in a social accord with labor is largely a relic of the past, with its structural bases having all but disappeared.

Even when social democratic parties come to power in these circumstances, promising to work within the system and create a kinder and gentler capitalism, they invariably fall prey to the laws of motion of capitalism in this phase. As Michael Yates writes, in the context of a failed capitalism: “Today, it is impossible to believe that there will be a recovery of even the modest political and economic project that labor unions and political parties once embraced and helped bring to fruition.”89

On the so-called liberal-left, some have adopted a broad technological-modernization approach, largely disregarding social relations. Here, in an implicit technological determinism, digital technology, social engineering, and wise liberal management are expected to reign supreme. It is true, such thinkers argue, that the capitalist absolutism of neoliberalism points to unending disaster. But capitalism can be altered, presumably from above, to fit any exigency, even the sidelining of profits and accumulation, conforming to current technological imperatives. What will remain of the system, in this conception, will be the bare frames of corporations and markets now devoid of any class or acquisitive drive, mere engines of efficiency.

As Jørgen Randers, one of the original Limits to Growth authors, declares in 2052—his forecast (in 2012) of the world society forty years into the future—that the “modified capitalism” that will emerge mid–point in this century “will be a system wherein collective well-being is set above the return of the individual.” Modified capitalism will be subject to the guidance of “wise government,” directed by technocrats, while being characterized by “less democracy and less market freedom.” Rather than directly facing up to the failures of capitalism—though he projects forty years of economic stagnation for the major economic powers and continued poverty in the “rest of the world”—Randers sees such questions as largely irrelevant to his vision of the world in 2052. The dominant reality, he predicts, will be a more efficient and sustainable, if more physically constrained, version of the present-day capitalist world.90

Yet, in the barely seven years since his book was written, it is already clear that Randers’s predictions were wrong in every respect. The situation confronting the world is qualitatively more serious than it was in 2012, at a time when gradualist, technocratic solutions to climate change still seemed feasible to many even among those on the left and when the liberal-democratic state appeared perfectly stable. Today, in the context of accelerated climate change, continuing economic stagnation, political upheaval, and growing geopolitical instability, it is clear that the challenges that the world is facing will be both more cataclysmic and epoch-making than progressive ecological modernizers like Randers envisioned. The choices confronting us are now much harder.
Indeed, history has been unkind to all such attempts to provide detailed forecasts of the future, particularly if they simply extend current trends and leave the bulk of humanity and their struggles out of the picture. It is for this reason that a dialectical view is so important. The actual course of history can never be predicted. The only thing certain about historical change is the existence of the struggles that drive it forward and that guarantee its discontinuous character. Both implosions and explosions inevitably materialize, rendering the world for new generations different than that of the old. History points to numerous social systems that have reached the limits of their ability to adapt their social relations to allow for the rational and sustainable use of developing productive forces. Hence, the human past is dotted by periods of regression, followed by revolutionary accelerations that sweep all before them. As the conservative historian Jacob Burckhardt declared in the nineteenth century, “a historical crisis” occurs when “a crisis in the whole state of things is produced, involving whole epochs and all or many peoples of the same civilization.… The historical process is suddenly accelerated in terrifying fashion. Developments which otherwise take centuries seem to flit by like phantoms in months or weeks, and are fulfilled.” He called this the “acceleration of historical processes.”91

Burckhardt principally had in mind social revolutions, like the French Revolution of 1789. This was an acceleration of history that, as the modern French historian Georges Lefebvre explained, commenced as a series of widening revolutions, mutating with terrifying speed, from an aristocratic revolution to a bourgeois revolution to a popular revolution and then a peasant revolution—finally taking on the character of a historic “bloc, a single thing,” seemingly unconquerable, which reshaped much of world history.92

Could such a revolutionary acceleration of history, though on an incomparably greater scale, happen in the twenty-first century? Most establishment commentators in the hegemonic countries of the world imperialist system would say no, based on their own narrow experience and limited view of history. Nevertheless, revolutions continue to break out in the periphery of the world system and are, even now, only put down by imperialist economic, political, and military interventions. Moreover, the failure of capitalism on a planetary scale today threatens all of civilization and life on the planet as we know it. If drastic changes are not made, global temperature this century will increase by 4° or even 6°C from preindustrial times, leading to conditions that will imperil humankind as a whole. Meanwhile, the extreme capitalism of today seeks to expropriate and enclose all the bases of material existence, siphoning off almost the entire net social surplus and robbing the natural environment for the direct benefit of a miniscule few.

As a direct result of capitalist social relations, the material challenges now facing humanity are greater than anything ever seen before, pointing to an accumulation of catastrophe along with the accumulation of capital.93 Hundreds of millions of people under these circumstances are already being drawn into struggles with the system, creating the basis of a new worldwide movement toward socialism. In his book Can the Working Class Change the World? Yates answers yes, it can. But it can only do so through a unifying struggle by workers and peoples aimed at genuine socialism.94

It may be objected that socialism has been tried and has failed and hence no longer exists as an alternative. However, like the earliest attempts at capitalism in the Italian city-states of the late Middle Ages, which were not strong enough to survive amongst the feudal societies that surrounded them, the failure of the first experiments at socialism presage nothing but its eventual rebirth in a new, more revolutionary, more universal form, which examines and learns from the failures.95 Even in failure, socialism has this advantage over capitalism: it is motivated by the demand for “freedom in general,” rooted in substantive equality and sustainable human development—reflecting precisely those collective social relations, borne of historical necessity and the unending struggle for human freedom, crucial to human survival in our time.96

The great conservative economist Joseph Schumpeter, who, as Austrian finance minister in Red Vienna, had allied himself for a time with the socialist government and found himself attacked on all sides, once wrote that capitalism would perish not because of “the weight of economic failure,” but rather because its “very success” in pursuing its narrow economic ends, had undermined the sociological foundations of its existence. Capitalism, Schumpeter exclaimed, “‘inevitably’ creates conditions in which it will not be able to live and which strongly point to socialism as its heir apparent.”97 He was, it turns out, in many ways correct, though not entirely in the way he expected. The global development of monopoly capitalism and financialization spearheaded by the very same counterrevolutionary neoliberalism that first arose in response to Red Vienna in the interwar years—at a time when Schumpeter himself was a major actor—has now undermined the material bases, not so much of capitalism itself, but of global society and planetary ecology. The result has been the emergence of an “atmosphere of almost universal hostility” to the prevailing social order, though, playing out in the confused context of the present, less as opposition to capitalism itself than to neoliberalism.98

It is capitalism’s undermining of the very basis of human existence that will eventually compel the world’s workers and peoples to seek new roads forward. An inclusive, class-based movement toward socialism in this century will open up the possibility of qualitative new developments that the anarchy of the capitalist-market society with its monopolistic competition, extreme inequality, and institutionalized greed cannot possibly offer.99 This includes the development of a socialist technology, in which both the forms of technology utilized and the purposes to which they are put are channeled in social directions, as opposed to individual and class gain.100 It introduces the prospect of long-term democratic planning at all levels of society, allowing decisions to be made and distributions to occur outside the logic of the cash nexus.101 Socialism, in its most radical form, is about substantive equality, community solidarity, and ecological sustainability; it is aimed at the unification—not simply division—of labor.

Once sustainable human development, rooted not in exchange values, but in use values and genuine human needs, comes to define historical advance, the future, which now seems closed, will open up in a myriad ways, allowing for entirely new, more qualitative, and collective forms of development.102 This can be seen in the kinds of needed practical measures that could be taken up, but which are completely excluded under the present mode of production. It is not physical impossibility, or lack of economic surplus, most of which is currently squandered, that stands in the way of the democratic control of investment, or the satisfaction of basic needs—clean air and water, food, clothing, housing, education, health care, transportation, and useful work—for all. It is not the shortage of technological know-how or of material means that prevents the necessary ecological conversion to more sustainable forms of energy.103 It is not some inherent division of humanity that obstructs the construction of a New International of workers and peoples directed against capitalism, imperialism, and war.104 All of this is within our reach, but requires pursuing a logic that runs counter to that of capitalism.

Humanity, Karl Marx wrote, “inevitably sets itself only such tasks as it is able to solve, since closer examination will always show that the problem itself arises only when the material conditions for its solution are already present or at least in the course of formation.”105 The very waste and excess of today’s monopoly-finance capitalism, together with the development of new means of communication that allow for greater human coordination, planning, and democratic action than ever before, suggest that there are countless paths forward to a world of substantive equality and ecological sustainability once the world is freed from the fetters of capital.106

The answers to the crises before us are both social and ecological. They require the rational regulation of the metabolism between human beings and nature under the control of associated humanity—regenerating and maintaining the flows, cycles, and other vital processes of healthy, local, regional, and global ecosystems (and species habitats)—in accord with the needs of the entire chain of human generations. The mainsprings of human action throughout history lie in the drive for human freedom and the struggle to master our relation to the world. The first of these ultimately demands equality and community; the second, human development and sustainability. It is on these struggles for collective advancement that we must ultimately rely if humanity is to have a future at all.


    ↩ George Monbiot, “The Earth Is in a Death Spiral. It will Take Radical Action to Save Us,” Guardian, November 14, 2018; Leonid Bershidsky, “Underemployment is the New Unemployment,” Bloomberg, September 26, 2018.
    ↩ For an insightful historical analysis of the general problem of the breakdown and disintegration of civilizations, see Arnold J. Toynbee, A Study of History, abridged by D.C. Somerveil (Oxford: Oxford University Press, 1946), 244–428.
    ↩ Karl Marx and Frederick Engels, The Communist Manifesto (New York: Monthly Review Press, 1964), 2.
    ↩ For analyses of stagnation and financialization, see Harry Magdoff and Paul M. Sweezy, Stagnation and the Financial Explosion (New York: Monthly Review Press, 1986); John Bellamy Foster and Fred Magdoff, The Great Financial Crisis (New York: Monthly Review Press, 2009); John Bellamy Foster and Robert W. McChesney, The Endless Crisis (New York: Monthly Review Press, 2012); Costas Lapavitsas, Profits Without Production: How Finance Exploits Us All (London: Verso, 2013).
    ↩ Drew Desilver, “For Most U.S. Workers, Real Wages Have Barely Budged in Decades,” Pew Research Center, August 7, 2018.
    ↩ Yuki Noguchi, “Gig Economy Renews Debate Over whether Contract Laborers Are Really Employees,” NPR, March 7, 2018.
    ↩ The concept of liberated capitalism is taken from Henryk Szlajfer (interviewed by Grzegorz Konat), “Liberated Capitalism,” forthcoming, Monthly Review.
    ↩ John Smith, Imperialism in the Twenty-First Century (New York: Monthly Review Press, 2016).
    ↩ Heather Stewart, “£13trn Horde Hidden from Taxman by Global Elite,” Guardian, July 21, 2012; Sam Ro, “The Mega Rich Are Holding at Least $21 Trillion in Offshore Tax Havens,” Business Insider, July 22, 2012; Nicholas Shaxson, Treasure Islands (London: Palgrave Macmillan, 2011).
    ↩ Larry Elliott, “Inequality Widens as 42 People Hold Same Wealth as 3.7bn Poorest,” Guardian, January 21, 2018; Rupert Neate, “Bill Gates, Jeff Bezos, and Warren Buffett are Wealthier than Poorest Half of US,” Guardian, November 8, 2017.
    ↩ World Inequality Report 2018 (World Inequality Lab, 2018).
    ↩ Lant Pritchett, “Divergence, Big Time,” Journal of Economic Perspectives 11, no. 3 (1997): 3–17; Jason Hickel, “Global Inequality May Be Worse than We Think,” Guardian, April 8, 2016; John Bellamy Foster, “The New Imperialism of Globalized Monopoly-Finance Capital,” Monthly Review 67, no. 3 (July–August 2015): 11–12.
    ↩ “More than 60 percent of the World’s Employed Population Are in the Informal Economy,” International Labour Organisation, April 30, 2018; Foster and McChesney, The Endless Crisis, 144–51.
    ↩ “State of Homelessness,” National Alliance to End Homelessness, accessed January 9, 2019,
    ↩ Oliver Milman, “‘We Are at War’: New York’s Rat Crisis Made Worse by Climate Change,” Guardian, December 21, 2018.
    ↩ Lisa Rapaport, “Life Expectancy Declines Seen in the US and Other High-Income Countries,” Reuters, August 22, 2018; “Life Expectancy in America Has Declined Two Years in a Row,” Economist, January 4, 2018; Rebecca Voelker, “Black Lung Resurgence Raises New Challenges for Coal Country Physicians,” JAMA Network, December 12, 2018; Thea Jourdan, “Return of the Victorian Diseases: Scarlet Fever, TB, Whooping Cough, Even Scurvy,” Daily Mail, April 4, 2016.
    ↩ Claas Kirchelle, “Pharming Animals: A Global History of Antibiotics in Food Production (1935–2017),” Palgrave Communications 4, no. 96 (2018); Amanda Holpuch, “UN Meeting Tackles the ‘Fundamental Threat’ of Antibiotic Resistant Superbugs,” Guardian, September 21, 2016: “Antimicrobial Resistance a ‘Global Health Emergency,” UN, Ahead of Awareness Week,” UN News, November 12, 2018; Rob Wallace, Big Farms Make Big Flu (New York: Monthly Review Press, 2016).
    ↩ Frederick Engels, The Condition of the Working Class in England (London: Penguin, 1987), 127–28.
    ↩ Stephanie Simon, “K–12 Student Databases Jazzes Te
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🤑 Building a Great Wall of Wealth
« Reply #66 on: February 28, 2019, 01:23:45 AM »

Tomgram: Nomi Prins, Building a Great Wall of Wealth
Posted by Nomi Prins   at 7:32am, February 26, 2019.


Honestly, the inequality gap in America should stagger the imagination or, on second thought, maybe it shouldn’t, not with the first billionaire in the White House and at least two more threatening to join him in a run for the presidency in 2020. After all, we now live on the planet of the billionaires. In January, as the billionaire summit in Davos, Switzerland, was about to be held, Oxfam summed our world up this way:

    “Billionaire fortunes increased by 12% last year -- or $2.5 billion a day -- while the 3.8 billion people who make up the poorest half of humanity saw their wealth decline by 11%... [T]he number of billionaires has nearly doubled since the financial crisis, yet wealthy individuals and corporations are paying lower rates of tax than they have in decades, thanks in part to the new tax law championed by President Trump.”

Yes, a billionaire strolled into the Oval Office in January 2017 and (don’t be shocked!) promptly fused with congressional Republicans not to fund America’s crumbling infrastructure of roads, dams, levies, and the like, or to offer better medical care, or to rescue the environment, or to face the climate crisis that threatens the human future, or to do anything that would help an average American. Instead, they focused on funding the creation of yet more of the super wealthy with a tax cut sent straight from billionaire heaven.

With 2020 in mind, President Trump is now warning American voters about the dangers of “radical left” Democrats, a crew of “socialists” capable of launching a reign of terror against... hmmm, billionaires. Let me quote the most dangerous among them. Bernie Sanders: “Instead of an austerity program for working families and the poor, we need austerity for billionaires and large multinational corporations.” Elizabeth Warren: “I want these billionaires to stop being freeloaders.” So watch out if they take the White House! And while you’re at it, check out what really should be the scandal of this American century. From the indispensable Nomi Prins, TomDispatch regular and author, appropriately enough, of Collusion: How Central Bankers Rigged the World, comes an overview of the economic “great wall” that Donald Trump and crew are building to keep most Americans out. Tom

    Survival of the Richest
    All Are Equal, Except Those Who Aren’t
    By Nomi Prins

    Like a gilded coating that makes the dullest things glitter, today’s thin veneer of political populism covers a grotesque underbelly of growing inequality that’s hiding in plain sight. And this phenomenon of ever more concentrated wealth and power has both Newtonian and Darwinian components to it.

    In terms of Newton’s first law of motion: those in power will remain in power unless acted upon by an external force. Those who are wealthy will only gain in wealth as long as nothing deflects them from their present course. As for Darwin, in the world of financial evolution, those with wealth or power will do what’s in their best interest to protect that wealth, even if it’s in no one else’s interest at all.

    In George Orwell’s iconic 1945 novel, Animal Farm, the pigs who gain control in a rebellion against a human farmer eventually impose a dictatorship on the other animals on the basis of a single commandment: “All animals are equal, but some animals are more equal than others.” In terms of the American republic, the modern equivalent would be: “All citizens are equal, but the wealthy are so much more equal than anyone else (and plan to remain that way).”

    Certainly, inequality is the economic great wall between those with power and those without it.

    As the animals of Orwell’s farm grew ever less equal, so in the present moment in a country that still claims equal opportunity for its citizens, one in which three Americans now have as much wealth as the bottom half of society (160 million people), you could certainly say that we live in an increasingly Orwellian society. Or perhaps an increasingly Twainian one.

    After all, Mark Twain and Charles Dudley Warner wrote a classic 1873 novel that put an unforgettable label on their moment and could do the same for ours. The Gilded Age: A Tale of Today depicted the greed and political corruption of post-Civil War America. Its title caught the spirit of what proved to be a long moment when the uber-rich came to dominate Washington and the rest of America. It was a period saturated with robber barons, professional grifters, and incomprehensibly wealthy banking magnates. (Anything sound familiar?) The main difference between that last century’s gilded moment and this one was that those robber barons built tangible things like railroads. Today’s equivalent crew of the mega-wealthy build remarkably intangible things like tech and electronic platforms, while a grifter of a president opts for the only new infrastructure in sight, a great wall to nowhere.

    In Twain’s epoch, the U.S. was emerging from the Civil War. Opportunists were rising from the ashes of the nation’s battered soul. Land speculation, government lobbying, and shady deals soon converged to create an unequal society of the first order (at least until now). Soon after their novel came out, a series of recessions ravaged the country, followed by a 1907 financial panic in New York City caused by a speculator-led copper-market scam.

    From the late 1890s on, the most powerful banker on the planet, J.P. Morgan, was called upon multiple times to bail out a country on the economic edge. In 1907, Treasury Secretary George Cortelyou provided him with $25 million in bailout money at the request of President Theodore Roosevelt to stabilize Wall Street and calm frantic citizens trying to withdraw their deposits from banks around the country. And this Morgan did -- by helping his friends and their companies, while skimming money off the top himself. As for the most troubled banks holding the savings of ordinary people? Well, they folded. (Shades of the 2007-2008 meltdown and bailout anyone?)

    The leading bankers who had received that bounty from the government went on to cause the Crash of 1929. Not surprisingly, much speculation and fraud preceded it. In those years, the novelist F. Scott Fitzgerald caught the era’s spirit of grotesque inequality in The Great Gatsby when one of his characters comments: “Let me tell you about the very rich. They are different from you and me.” The same could certainly be said of today when it comes to the gaping maw between the have-nots and have-a-lots.

    Income vs. Wealth

    To fully grasp the nature of inequality in our twenty-first-century gilded age, it’s important to understand the difference between wealth and income and what kinds of inequality stem from each. Simply put, income is how much money you make in terms of paid work or any return on investments or assets (or other things you own that have the potential to change in value). Wealth is simply the gross accumulation of those very assets and any return or appreciation on them. The more wealth you have, the easier it is to have a higher annual income.

    Let’s break that down. If you earn $31,000 a year, the median salary for an individual in the United States today, your income would be that amount minus associated taxes (including federal, state, social security, and Medicare ones). On average, that means you would be left with about $26,000 before other expenses kicked in.

    If your wealth is $1,000,000, however, and you put that into a savings account paying 2.25% interest, you could receive about $22,500 and, after taxes, be left with about $19,000, for doing nothing whatsoever.

    To put all this in perspective, the top 1% of Americans now take home, on average, more than 40 times the incomes of the bottom 90%. And if you head for the top 0.1%, those figures only radically worsen. That tiny crew takes home more than 198 times the income of the bottom 90% percent. They also possess as much wealth as the nation’s bottom 90%. “Wealth,” as Adam Smith so classically noted almost two-and-a-half-centuries ago in The Wealth of Nations, “is power,” an adage that seldom, sadly, seems outdated.

    A Case Study: Wealth, Inequality, and the Federal Reserve

    Obviously, if you inherit wealth in this country, you’re instantly ahead of the game. In America, a third to nearly a half of all wealth is inherited rather than self-made. According to a New York Times investigation, for instance, President Donald Trump, from birth, received an estimated $413 million (in today’s dollars, that is) from his dear old dad and another $140 million (in today's dollars) in loans. Not a bad way for a “businessman” to begin building the empire (of bankruptcies) that became the platform for a presidential campaign that oozed into actually running the country. Trump did it, in other words, the old-fashioned way -- through inheritance.

    In his megalomaniacal zeal to declare a national emergency at the southern border, that gilded millionaire-turned-billionaire-turned-president provides but one of many examples of a long record of abusing power. Unfortunately, in this country, few people consider record inequality (which is still growing) as another kind of abuse of power, another kind of great wall, in this case keeping not Central Americans but most U.S. citizens out.

    The Federal Reserve, the country’s central bank that dictates the cost of money and that sustained Wall Street in the wake of the financial crisis of 2007-2008 (and since), has finally pointed out that such extreme levels of inequality are bad news for the rest of the country. As Fed Chairman Jerome Powell said at a town hall in Washington in early February, "We want prosperity to be widely shared. We need policies to make that happen." Sadly, the Fed has largely contributed to increasing the systemic inequality now engrained in the financial and, by extension, political system. In a recent research paper, the Fed did, at least, underscore the consequences of inequality to the economy, showing that “income inequality can generate low aggregate demand, deflation pressure, excessive credit growth, and financial instability.”

    In the wake of the global economic meltdown, however, the Fed took it upon itself to reduce the cost of money for big banks by chopping interest rates to zero (before eventually raising them to 2.5%) and buying $4.5 trillion in Treasury and mortgage bonds to lower it further. All this so that banks could ostensibly lend money more easily to Main Street and stimulate the economy. As Senator Bernie Sanders noted though, “The Federal Reserve provided more than $16 trillion in total financial assistance to some of the largest financial institutions and corporations in the United States and throughout the world... a clear case of socialism for the rich and rugged, you're-on-your-own individualism for everyone else."

    The economy has been treading water ever since (especially compared to the stock market). Annual gross domestic product growth has not surpassed 3% in any year since the financial crisis, even as the level of the stock market tripled, grotesquely increasing the country’s inequality gap. None of this should have been surprising, since much of the excess money went straight to big banks, rich investors, and speculators.  They then used it to invest in the stock and bond markets, but not in things that would matter to all the Americans outside that great wall of wealth.

    The question is: Why are inequality and a flawed economic system mutually reinforcing? As a starting point, those able to invest in a stock market buoyed by the Fed’s policies only increased their wealth exponentially. In contrast, those relying on the economy to sustain them via wages and other income got shafted. Most people aren’t, of course, invested in the stock market, or really in anything. They can’t afford to be. It’s important to remember that nearly 80% of the population lives paycheck to paycheck.

    The net result: an acute post-financial-crisis increase in wealth inequality -- on top of the income inequality that was global but especially true in the United States. The crew in the top 1% that doesn’t rely on salaries to increase their wealth prospered fabulously. They, after all, now own more than half of all national wealth invested in stocks and mutual funds, so a soaring stock market disproportionately helps them. It’s also why the Federal Reserve subsidy policies to Wall Street banks have only added to the extreme wealth of those extreme few. 

    The Ramifications of Inequality

    The list of negatives resulting from such inequality is long indeed. As a start, the only thing the majority of Americans possess a greater proportion of than that top 1% is a mountain of debt.

    The bottom 90% are the lucky owners of about three-quarters of the country’s household debt. Mortgages, auto loans, student loans, and credit-card debt are cumulatively at a record-high $13.5 trillion.

    And that’s just to start down a slippery slope. As reports, wealth and income inequality impact “everything from life expectancy to infant mortality and obesity.” High economic inequality and poor health, for instance, go hand and hand, or put another way, inequality compromises the overall health of the country. According to academic findings, income inequality is, in the most literal sense, making Americans sick. As one study put it, “Diseased and impoverished economic infrastructures [help] lead to diseased or impoverished or unbalanced bodies or minds.”

    Then there’s Social Security, established in 1935 as a federal supplement for those in need who have also paid into the system through a tax on their wages. Today, all workers contribute 6.2% of their annual earnings and employers pay the other 6.2% (up to a cap of $132,900) into the Social Security system. Those making far more than that, specifically millionaires and billionaires, don’t have to pay a dime more on a proportional basis. In practice, that means about 94% of American workers and their employers paid the full 12.4% of their annual earnings toward Social Security, while the other 6% paid an often significantly smaller fraction of their earnings.

    According to his own claims about his 2016 income, for instance, President Trump “contributed a mere 0.002 percent of his income to Social Security in 2016.” That means it would take nearly 22,000 additional workers earning the median U.S. salary to make up for what he doesn’t have to pay. And the greater the income inequality in this country, the more money those who make less have to put into the Social Security system on a proportional basis. In recent years, a staggering $1.4 trillion could have gone into that system, if there were no arbitrary payroll cap favoring the wealthy.

    Inequality: A Dilemma With Global Implications

    America is great at minting millionaires. It has the highest concentration of them, globally speaking, at 41%. (Another 24% of that millionaires’ club can be found in Europe.) And the top 1% of U.S. citizens earn 40 times the national average and own about 38.6% of the country’s total wealth. The highest figure in any other developed country is “only” 28%.

    However, while the U.S. boasts of epic levels of inequality, it’s also a global trend. Consider this: the world’s richest 1% own 45% of total wealth on this planet. In contrast, 64% of the population (with an average of $10,000 in wealth to their name) holds less than 2%. And to widen the inequality picture a bit more, the world’s richest 10%, those having at least $100,000 in assets, own 84% of total global wealth.

    The billionaires' club is where it’s really at, though. According to Oxfam, the richest 42 billionaires have a combined wealth equal to that of the poorest 50% of humanity. Rest assured, however, that in this gilded century there’s inequality even among billionaires. After all, the 10 richest among them possess $745 billion in total global wealth. The next 10 down the list possess a mere $451.5 billion, and why even bother tallying the next 10 when you get the picture?

    Oxfam also recently reported that “the number of billionaires has almost doubled, with a new billionaire created every two days between 2017 and 2018. They have now more wealth than ever before while almost half of humanity have barely escaped extreme poverty, living on less than $5.50 a day.”

    How Does It End?

    In sum, the rich are only getting richer and it’s happening at a historic rate. Worse yet, over the past decade, there was an extra perk for the truly wealthy. They could bulk up on assets that had been devalued due to the financial crisis, while so many of their peers on the other side of that great wall of wealth were economically decimated by the 2007-2008 meltdown and have yet to fully recover.

    What we’ve seen ever since is how money just keeps flowing upward through banks and massive speculation, while the economic lives of those not at the top of the financial food chain have largely remained stagnant or worse. The result is, of course, sweeping inequality of a kind that, in much of the last century, might have seemed inconceivable.

    Eventually, we will all have to face the black cloud this throws over the entire economy. Real people in the real world, those not at the top, have experienced a decade of ever greater instability, while the inequality gap of this beyond-gilded age is sure to shape a truly messy world ahead. In other words, this can’t end well.

    Nomi Prins, a former Wall Street executive, is a TomDispatch regular. Her latest book is Collusion: How Central Bankers Rigged the World (Nation Books). She is also the author of All the Presidents' Bankers: The Hidden Alliances That Drive American Power and five other books. Special thanks go to researcher Craig Wilson for his superb work on this piece.

    Follow TomDispatch on Twitter and join us on Facebook. Check out the newest Dispatch Books, John Feffer’s new dystopian novel (the second in the Splinterlands series) Frostlands, Beverly Gologorsky's novel Every Body Has a Story, and Tom Engelhardt's A Nation Unmade by War, as well as Alfred McCoy's In the Shadows of the American Century: The Rise and Decline of U.S. Global Power and John Dower's The Violent American Century: War and Terror Since World War II.

    Copyright 2019 Nomi Prins

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Thousands of New Millionaires Are About to Eat San Francisco Alive
« Reply #67 on: March 08, 2019, 07:28:23 AM »
File this under : Let's all drink the koool-aid  :coffee:  pump n' dump

Uber, Lyft, Airbnb and Pinterest plan to go public. California’s newly minted rich will be hungry for parties, houses, boats, bikes — and ice sculptures.
I know exactly what you mean. Let me tell you why you’re here. You’re here because you know something. What you know you can’t explain, but you feel it. You’ve felt it your entire life, that there’s something wrong with the world.
You don’t know what it is but its there, like a splinter in your mind

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🤑 "White Trash: The 400-Year History of Class in America"
« Reply #68 on: May 22, 2019, 02:58:24 AM »
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🤑 Wealth Maldistribution: Ex-Mrs. Bozos builds a Tax Dodge
« Reply #69 on: May 29, 2019, 12:03:48 AM »
What to do if you divorce the richest scumbag in the world and get a nice $36B Alimony Check?  Take a lesson fromthe Big Gorilla, Ford, Rockefeller and Andy Caarnegie and go Philanthropic!  Gotta Dodge those nasty Taxes!

Maybe she could spare some pocket change to fund SUN?


MacKenzie Bezos and the Pitfalls of Tech Philanthropy
by Louise Matsakis

Daniel Acker/Bloomberg/Getty Images

Nearly two months after her divorce from Amazon CEO Jeff Bezos was finalized, MacKenzie Bezos has made a plan to be far more generous than she and her former husband were as a couple. When the pair split, she became one of the richest women in the world, with a fortune estimated to be worth more than $36 billion. Now she wants to start giving it away.

“I have a disproportionate amount of money to share,” MacKenzie, a novelist, wrote bluntly in an otherwise literary letter announcing her decision to join the Giving Pledge Tuesday. “My approach to philanthropy will continue to be thoughtful. It will take time and effort and care. But I won’t wait. And I will keep at it until the safe is empty.”

Since it was founded by notable rich people Bill Gates, Melinda Gates, and Warren Buffet in 2010, the Giving Pledge has attracted over 200 wealthy individuals from around the world who publicly commit to donate at least half of their money either during their lifetimes or in their wills. While signaling you’re about to disperse at least $18 billion is notable under any circumstances, MacKenzie’s announcement attracted particular attention in part because the Bezos fortune has been tightly held so far. Jeff, literally the richest person in the world, has committed far less to philanthropic efforts. Last year, he announced he would spend just $2 billion of his $150 billion fortune on charity.
Louise Matsakis covers Amazon, internet law, and online culture for WIRED.

But even Jeff was willing to congratulate MacKenzie on her decision Tuesday. “MacKenzie is going to be amazing and thoughtful and effective at philanthropy, and I’m proud of her,” he wrote on Twitter. “Pay taxes, Jeff,” someone else replied. (Amazon paid no federal income taxes in 2018, largely as a result of Republican tax cuts passed the year before.)

That exchange neatly sums up the debate over the role of philanthropy in the US today.

In 1889, steel magnate Andrew Carnegie, perhaps the richest man in history, wrote a pamphlet called “The Gospel of Wealth,” in which he advocated for the wealthy to spend their lives donating to public institutions like libraries and universities. Carnegie called the practice “the true antidote for the temporary unequal distribution of wealth, the reconciliation of the rich and the poor—a reign of harmony.” The only problem is it hasn’t worked. Inequality in the United States is likely worse than it was during Carnegie’s era, despite the fact that the number of registered nonprofits in the United States has ballooned.

Meanwhile, the technology sector has made a small group of founders, early employees, and investors incredibly wealthy. Some of them have begun rebranding as philanthropists, like WhatsApp cofounder Brian Acton, Pinterest cofounder Paul Sciarra, and Brian Armstrong, CEO of cryptocurrency exchange Coinbase, who all signed the Giving Pledge in the past year as well.

But critics of the Giving Pledge and similar initiatives say they amount to little more than PR plays. If MacKenzie and her fellow elites spend their fortunes slower than they anticipate, there won't be any repercussions: They aren’t under any legal obligation to meet the requirements of the Giving Pledge, which its website describes as a “moral agreement.” It’s difficult to track whether every billionaire who signs adheres to the pledge, and several may not have done so, according to a Bloomberg report from 2015.

More broadly, charitable efforts carried out by the 1 percent don’t fix the systemic issues of inequality they have benefited from. “The richest and most powerful people in the world are unwittingly fighting on both sides of a war,” Anand Giridharadas, author of Winners Take All and a prominent critic of charity efforts in the tech sector, said at a WIRED conference last year. “Causing, by daylight, problems that they simply will never be able to undo by philanthropic moonlight.”

Rich people often channel their money into pet causes, rather than direct aid to people in material need. Groups financed by members of the Koch family, who made billions in the oil and gas industry, have helped kill public transportation initiatives across the country. North Carolina multimillionaire Art Pope has used his wealth to fund organizations that went on to advocate for voter suppression laws. Some of this wealth has flowed to liberal issues too, notes David Callahan in his book The Givers: Wealth, Power, and Philanthropy in a New Gilded Age. He points to Tim Gill, for instance, a software engineer who sold his company and later donated hundreds of millions to LGBTQ causes.

But even when the rich donate to admirable efforts, the money doesn’t always have its intended effect. When Facebook CEO Mark Zuckerberg donated a whopping $100 million to schools in Newark, New Jersey, returns on that investment were mixed: Student achievement levels increased somewhat in English, but not in math. As chronicled in Dale Russakoff’s 2015 book The Prize: Who’s in Charge of America’s Schools? teachers, parents, and students were often left out of the decisionmaking process over what should be done with the money. Some of the initial cash was spent on consultants, who were paid up to $1,000 a day.

Of course, it’s almost certainly better for billionaires to give away their fortunes than hoard them, especially when the funds go to supporting basic needs like food and health care. The Bill & Melinda Gates Foundation, for example, says it has committed almost $3 billion in grants to combat malaria, a disease that affects over 200 million people around the world each year. Since 2010, the World Health Organization estimates malaria mortality rates have fallen 29 percent, thanks to prevention and control measures. (Meanwhile, Bill Gates continues accumulating wealth.)

In the meantime, backlash against inequality continues to grow. A recent poll found 76 percent of registered US voters believe the wealthiest should pay more in taxes. Presidential candidates like Elizabeth Warren and Bernie Sanders have proposed increasing taxes on the rich, positing that forcing the 1 percent to pay their fair share would be a true antidote to inequality—rather than charity.

For now, MacKenzie Bezos hasn’t revealed many specifics about how she plans to distribute her fortune. In 2014, she started an organization that advocates against bullying, and it’s possible some of the money could go to similar efforts. No matter what, in giving away her money, MacKenzie will be exercising enormous power that few people in the world can match.
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there’s old money, really old money and then there’s C. Hoare & Co.
« Reply #70 on: July 09, 2019, 04:38:55 PM »

The British Banking Dynasty That’s Even Older Than the Rothschilds

C. Hoare & Co. has been in business for more than three hundred years, and the family that founded it is still running the show.
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Bozo's DUMPS $2.8B in Amazon stocks
« Reply #71 on: August 07, 2019, 11:29:11 AM »

Amazon CEO Jeff Bezos has sold roughly $2.8 billion worth of stock in the last week, new filings show
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🤑 The Isle of White: a Tale of the Have-Lots Versus the Have-Nots
« Reply #72 on: August 20, 2019, 03:36:37 AM »

August 19, 2019
The Isle of White: a Tale of the Have-Lots Versus the Have-Nots
by John Davis

Photograph Source: Jason Philbrook – CC BY-SA 2.5

The island of North Haven in the Penobscot Bay, Maine, is an eastern establishment, white-shoe summer-place overlain on a diesel swilling, bottom feeding lobster-industry that supports the year-round residents of this tiny, fractal-shored resort. It is washed by the Gulf Stream and reports the fastest rising ocean temperatures in the Western hemisphere, dramatic sea level rises and a devastated eco-system. Comprehensively cleared of its old-growth hardwood forests in the nineteenth century, its second growth pines are now attacked by bark beetles moving north under the duress of a warming climate. In place of the diseased trees, the severely invasive, non-native Buckthorn is proliferating. Lashed by several hurricanes in the twentieth century, the island now awaits the first of this century’s superstorms. Already, beaches are eroding into the bay at alarming rates.

But some still say it is paradise. Expensive yachts crowd its harbors and summer visitors wave cheerily to each other as they drive or bicycle along its well-paved roads. The summer houses of the rich and discreet spot its meadows, bays and palisades. Vacation revelers eat ice cream and drink the craft-beers of North Haven Brewery along the harbor front, eat gourmet pizzas, and enjoy coffee, movies and ping-pong at Waterman’s, the community center. Lily-white youngsters learn to sail off the Casino dock. There are a couple of art galleries, a hotel and restaurant and, in the summer months, a farmer’s market.

This east coast summer enclave of wealth and privilege was originally founded between 1910 and 1920 by Wall Street luminaries, including the Morgans, the Rockefellers and the Lamonts. Shortly afterwards, Thomas Watson, founder of IBM, established a 300-acre summer estate along the island’s northern shore. Several generations of their descendants still summer on this gilded isle, joined now by other families of post-Second World War, Twentieth-Century wealth.

The island is unspeakably white. There are other ‘white’ summer enclaves (and certainly not all are islands) just like it up and down the east coast of America. They are where many of the wealthiest, of old money and new, go to live the summers of their dreams–a summer amongst their peers, with just enough poor and middle-class workers to service their every need and, perhaps, to add just a little historical authenticity to their Fantasy Island.

North Haven is powered by three gleaming (white) wind turbines, discreetly located on an adjacent island. They illustrate the uncanny ability of the rich to thrive in green, sustainable communities while the poor often remain in the polluted cities, suburbs and exurbs from whence wealth is extracted. The island demonstrates the dark survival of what we can quaintly call the class struggle whilst establishing the evolution of that conflict within a subsuming ecological crisis.

Deregulation, since the early 1990’s, has facilitated the globalization of the economy and the out-sourcing of production to regions of low-cost labor, primarily Asia. This trend is resisted politically by the poor and middle class who have found a salve to their financial wounds in fierce nationalisms that cohere around skin-color, religion and territorial origin stories. This much we know. It is Bruno Latour, the French philosopher, who has added a third dimension to this dynamic by suggesting that those made wealthy in this global revolution are very aware that the climate catastrophe will now further curtail the well-being of most of humanity. In Latour’s telling (Down to Earth, 2018) the uber-rich have made the calculus that the world will be increasingly riven between the haves and the have-nots and that they will make no attempt, either politically or economically, to heal the rift. Indeed, they will, he suggests, continue to assiduously corral the world’s resources for their own benefit since there is not now, and likely never will be, enough to go around in a world closing in on eight billion people and whose natural beneficence is increasingly disrupted by weather terrorism.

The class struggle has metastasized, gone global, and is now conjoined wit the fight to maintain a habitable planet. The apparent prosperity that existed in the United States post 1945 allowed for a brief flickering of hope for something like wide-spread well-being (at least as evidenced by the white population’s material prosperity). Three decades of this historically anomalous economic circumstance were coopted by the state as an ideological weapon in the cold-war, but shortly abandoned in the mid-1970’s when corporate America reacted to the social challenges presented by the revolutions of the1960’s by self-interestedly assuaging calls for personal freedom and expressions of individuality by reducing security of employment and initiating the beginnings of the gig-economy. It was Luc Boltanski and Eva Chiapello, in The New Spirit of Capitalism, 1999, who painstakingly connected the dots. The increasing precarity this caused served the wealthy elites, while Bill Clinton’s vicious Violent Crime Control & Enforcement Act of 1994, enacted policies of mass incarceration, further intimidating neighborhoods already suffering from this financial destabilization.

It has only gotten worse. Wars waged against the poor, on drugs, on terror, on health, on welfare and on immigrants are all in service to protecting those elites, who, having abandoned all aspirations towards universally equitable social improvement, if indeed they ever harbored them, are now engineering the impoverishment of those eight billion ‘others’ with whom they nominally share the planet. As the global elites’ press their advantage in this war of the have-lots against the have-nots, some, in the most disaffected communities, retreat to the politics of extreme nationalism and race, manifested at the margins by apparently irrational mass violence. Perhaps white supremacists perceive their skin color as their only asset as they fight a rearguard action against diminished prospects of achieving self-respect and economic viability; extreme nationalists may perceive their birthplace as conferring special privileges within ancestral origin stories which are threatened by the arrival of the non-native born – their worth daily diluted. Whatever the motivations of the disaffected, they risk becoming grist to an over-arching war on the poor and middle-class – either coopted by governments as their shock-troops or used as a pretext for draconian social controls.

We live in a new era of exclusion and extirpation that is fundamental to the vision of America not-so-secretly harbored in the hearts and minds of the powerful and well-heeled. Spot fires of deadly violence inevitably flare up amongst the underclass, unknowingly aping the ideologies of the ruling caste who then lightly condemn them. As Todd Miller shows in Empire of Borders, 2019, U.S. border protection radiates beyond the homeland far across the planet – where its agencies attempt to hold the line against the infiltration of…’your tired, your poor, Your huddled masses yearning to breathe free, The wretched refuse of your teeming shore’… and the non-white. Our southern border is the last in line of serried ranks of exclusionary practices made manifest and is the notorious site of graphic barbarity practiced for the edification of the world.

The United States displays exemplary leadership amongst those states in the Global North committed to harassing, impoverishing, quarantining, deporting, imprisoning and denying quality education and health care to most of its citizens (and almost a totality of its undocumented inhabitants). As Paul Street succinctly establishes here, this country no longer represents even a notional leadership in democracy; instead, for the last forty years we have led the world in income triage, abandoning fully ninety percent of the population in a relentless quest to achieve obscene levels of wealth disparity. This amassing of great wealth (which represents access to resources) is the ultimate hedge by global elites against a collapsing eco-system amidst catastrophic climate change. In this country it is practiced by the uber-wealthy with a sublime disregard for the immiseration caused by their wealth-hording.

Those who are politically & philosophically engaged in the travails of the Anthropocene understand that a revolution that attempts to install democracy in the United States is irrelevant unless it is framed within the larger struggle of the poor against the rich, which is a entwined with the war to preserve a viable planet for our shared future. Historically, it is has taken power and resources to destroy the environment – the traditional purview of the wealthy. The poor are but instruments of this depredation, as, for instance, miners, drillers, builders, fishers, farmers, soldiers, policemen and ultimately, as consumers.

If we continue to triage humanity along the wealth divide only the rich will live green, along with their select non-human companions, in their urban principalities, country estates, mountain aeries or idyllic islands. Others will endure in the brown fields of environmental devastation amidst the carnage of the sixth extinction, while the violence of the most disaffected bubbles up around them, disguised as nationalism, race-hate or religion. These ‘others’ may wait at the gates or loiter along the shores, and idly engage in discussions of freedom and democracy, but the vortices of effective power swirl ever further beyond their reach.
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🤑 The New Servant Class
« Reply #73 on: August 22, 2019, 12:30:59 AM »

The New Servant Class

“Wealth work” is one of America’s fastest-growing industries. That’s not entirely a good thing.

Aug 12, 2019
Derek Thompson
Staff writer at The Atlantic

Jacobs Stock Photography Ltd / Getty

In an age of persistently high inequality, work in high-cost metros catering to the whims of the wealthy—grooming them, stretching them, feeding them, driving them—has become one of the fastest-growing industries.

The MIT economist David Autor calls it “wealth work.”

Low-skill, low-pay, and disproportionately done by women, these jobs congregate near dense urban labor markets, multiplying in neighborhoods with soaring disposable income. Between 2010 and 2017, the number of manicurists and pedicurists doubled, while the number of fitness trainers and skincare specialists grew at least twice as fast as the overall labor force.
SOURCE: Brookings analysis of OES data and IPUMS-USA ACS microdata

While there are reasons to be optimistic about this trend, there is also something queasy about the emergence of a new underclass of urban servants.

Let’s start with the bright side: As manufacturing has declined, service jobs have been a crucial source of work for those without a college degree. Immigrants fill many of these positions. According to Mark Muro, a senior fellow at the Brookings Institution, an estimated 20 percent of wealth work is done by people who are not citizens, compared with less than 10 percent of all U.S. labor. Foreign-born workers often move to large metros to find jobs before relocating to cheaper towns and suburbs to build a more permanent home. In this way, one can see wealth work as a bridge for foreign-born workers and less skilled Americans to get a foothold in the labor force.

But Muro cautioned in an interview that “we should also look to the tolerability of these jobs and the precariousness of these lives.”

Annie Lowrey: The gig economy isn’t really taking over

Wealth work falls into two basic categories. First, full-time retail and service jobs at places like nail salons and spas. “You’re talking about people with $30,000 incomes that are often employed in high-wealth metro areas, or resort economies,” Muro said. Because they often cannot afford to live near their place of work, they endure long commutes from lower-cost neighborhoods. These arrangements aren’t merely time-consuming; they can also be exploitative. For example, New York City nail salons are notorious for flouting minimum-wage laws and other labor regulations, and massage parlors across Florida have served as fronts for human trafficking.

A second category is the “Uber for X” economy—that nebulous network of people contracted through online marketplaces for driving, delivery, and other on-demand services. Optimistically, these jobs offer autonomy for workers and convenience for consumers, many of whom aren’t wealthy. But the business models that keep these firms aloft rely on the strategic avoidance of laws like the Fair Labor Standards Act, which regulates minimum wage and overtime pay. These laborers often do the work of employees with the legal protections of contractors—which is to say, hardly any.

In both types of situation, the relationship between wealth workers and their customers is easily exploited and often impersonalized—an oddity considering the intimacy of the work, which involves feeling hair, touching nails, massaging skin, entering a stranger’s home to assemble his bedroom, or welcoming him into your car.

Derek Thompson: The booming, ethically dubious business of food delivery

Wealth work is not new—nor are its critiques.

“For centuries, a woman’s social status was clear-cut: Either she had a maid or she was one,” the author Ester Bloom wrote in The Atlantic. In the late 19th century, more than half of women worked in domestic and personal service.

Today’s “servant economy”—as The Atlantic’s Alexis Madrigal has called it—is vastly superior to that of the late 19th century (to say nothing of the slave economy that preceded it). The nannies, house cleaners, and cooks of the past had little to no recourse, not even in name, to the protection of the law if their employers maltreated them. But their work was also less anonymous; the hired help tended to live with their employers, where they would cook, clean, and care for children. These workers were integrated into family life in a way that is unthinkable for the anonymous wealth workers of the modern world.

Relationships between the classes, once mediated through the household, are now managed through an app that serves a large metro area. The workers of the new servant economy don’t live with their employers, but rather sleep many miles away where they can afford a bedroom. “You could argue there was a more benignly human quality to the old aristocratic relationships,” the economist Muro told me. “Today’s platforms strip down what was once a job into simple, seamless transactions.”

Many contractors surely relish the autonomy—and perhaps even the anonymity—of these apps, which give on-demand wealth workers flexibility to work whenever and wherever they wish, while protecting their privacy from clients (if not from the apps themselves), but the rush to make these transactions seamless can make both sides of this marketplace feel invisible. Customers have disaggregated the servant by spreading a once-intimate job across hundreds of drivers, delivery people, and spa workers. Those workers, in turn, have little reason to remember their clients’ names.

Perhaps the ultimate price of wealth work, for all of the opportunities for the low-skilled, is not only the threat of exploitation, but broader alienation. In a digital marketplace of maximal convenience, there is no room for the friction of intimacy.

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Derek Thompson is a staff writer at The Atlantic, where he writes about economics, technology, and the media. He is the author of Hit Makers and the host of the podcast Crazy/Genius.
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FUCK THIS GUY, I'm PISSED. I want his head on a Stick !
« Reply #74 on: September 18, 2019, 12:00:18 PM »
Cutting Health Benefits of 1,900 Whole Food Workers Saved World’s Richest Man Jeff Bezos What He Makes in Less Than Six Hours

When billionaire Jeff Bezos cut health benefits on September 13 for part-time workers at his grocery store Whole Foods the richest man in the world saved the equivalent of what he makes from his vast fortune in just a few hours.

That’s according to an analysis from Decision Data’s “Data in the News” series, which found that Bezos could cover the entirety of annual benefits for part-time employees who work less than 30 hours a week with what he makes from stocks and investments in just a fraction of a day.

“Doing a quick calculation with existing publicly available numbers shows that Bezos makes more money than the cost of an entire year of benefits for these 1,900 employees in somewhere between 2-6 hours,” the study says.

The analysis used an estimate that Whole Foods would contribute between $5,000 and $15,000 annually per employee for benefits. At the middle of that range, $10,000, that comes to $19 million a year.

Bezos makes just under $9 million an hour, according to a 2019 Business Insider analysis, which would mean he makes enough money in a little over two hours to cover the benefits he cut. Decision Data used an earlier study which found Bezos makes $4.5 million an hour to conclude he would need approximately four and a half hours to cover the cost.

“CEO worth more than $110 billion cuts health care for 2,000 workers after raking in $9 million an hour,” tweeted economist Robert Reich, citing the 2019 Business Insider figure.

The disconnect between Bezos’ wealth and the cost of the benefits was remarked on by a number of observers.

“Jeff Bezos makes $3,182 a second,” said Jacobin writer Luke Savage.

Presidential candidate and former Secretary of Housing and Urban Development Julián Castro called the move “shameful” and noted that Bezos’ crown jewel, online retailer Amazon, pays nothing in taxes.

“Amazon pays zero dollars in federal income taxes,” Castro tweeted. “Jeff Bezos is the richest man in modern history, and yet they continue to degrade the rights of their workers.”
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