Matt Taibbi has identified an 800 ton wild animal, living somewhere within the halls of Capital Hill:
We probably need to start wondering why this keeps happening. Also, this: if the Democrats suck so bad at political combat, then how come they continue to be rewarded with such massive quantities of campaign contributions? When the final tally comes in for the 2012 presidential race, who among us wouldn't bet that Barack Obama is going to beat his Republican opponent in the fundraising column very handily? At the very least, he won't be out-funded, I can almost guarantee that.
And what does that mean? Who spends hundreds of millions of dollars for what looks, on the outside, like rank incompetence?
It strains the imagination to think that the country's smartest businessmen keep paying top dollar for such lousy performance. Is it possible that by "surrendering" at the 11th hour and signing off on a deal that presages deep cuts in spending for the middle class, but avoids tax increases for the rich, Obama is doing exactly what was expected of him?
What he does not give is a distant enough perspective to reveal just exactly what kind of creature he's uncovered. Only that it's big. And hairy. And that we don't even begin to know what the fuck to do with it.
Most people who've told wild eyed tales of this beast before have served to mythologize it by giving it such names as the "Trilateral Commission" or the "Bilderberg group." The theories were so weak that most in the Beltway had long since written the beast off as a hoax. Taibbi has thus broken major journalistic and scientific ground with his discovery, and the first question at hand, and it's one that we ALL must ask ourselves, is as follows: What IS that frigging thing?
Paul Krugman has also picked up on some strange tracks: today on Bloomberg, he told the nationthat he had "inside information" that the Republican leaders in Washington were telling each other not to act too celebratory in this obviously major victory, but instead to be sure and downplay its significance in public. Hmmm.
What Krugman has picked up on and Taibbi has identified are the symptoms of a great white whale known as the erosion of American democracy. Since it's now been discovered, we no longer need to debate its existence, and can concentrate our energies on understanding it and hopefully taming it, though it may be too late for that.
What is American democracy, and why is it eroding?
America has a unique system of government, representative democratic capitalism, unique in both its bi-partite form and its longevity (along with the UK). By longevity, I mean that it has remained largely the same throughout its entire history, albeit with some major changes, almost always for the better, and it has thus far never backslid to banana republicanism. Capitalism refers to the mode of production that forms the division of labor, and it tells the following story: "Capitalists start the day with a certain amount of money. They buy means of production and labor power and put both to work with a given technology to create a new commodity which they sell in the market place for the original money plus a surplus (called profit) at the end of the day." This of course presumes that there is demand for their product, but this diary assumes we all know the problems with this story. Representative democracy, on the other hand, means that we elect representatives who then participate in a democratic system to determine the allocation of the resources of America, the level of taxes, the distribution of resources, etc. And there is no direct connection between the former and the latter, except the historical fact that most democracies have traditionally happened to be capitalist. And that is because we (the US) have largely been both the model and the crusaders for this form of government. Indeed, it was only in the 1940's, after WWII had allowed for the minimal resistance required for the Marshall Plan to take foot, that Europe and Japan followed America to form a stable constellation of stable representative democracies, represented now as the other two branches of the powerful policy-setting institution known as the trilateral commission. These democracies are said to be permanently peaceful toward one another, and indeed no two consolidated democracies have ever fought a war against each other. Why? There are two main explanations.
The first explanation is because of interstate trust that is grounded in the perceptions of the populations in democracies about the virtues of their own form of government. The elected officials are perceived to bear a greater cost of the war than autocracies, for example by getting voted out as a result of the suffering wars cause, and thus domestic populations in one country are likely to trust the elected leader of another country provided that they are both democratic. So leaders with "Democratically Peaceful" foreign policies get elected. Never mind that democracies are more war-like overall, I'll address that further down. This is what might be called the "democratic democratic peace theory."
Another possibility, not mutually exclusive, says that the reason capitalist democracies don't fight one another is that they trade with each other, and that the benefits of trade so outweigh the costs of war that they don't see any reason to consider one another as a threat, and therefore, alliances are formed against the states they DO feel threatened by: the autocracies and autarkies that either suppress democratic participation or eschew free market capitalism, or both. This market-centric explanation might be referred to as the "capitalist democratic peace theory" or even just the "capitalist peace theory."
Together, these two explanations constitute a major theory of international relations dating all the way back to Kant's Perpetual Peace, known as Liberalism. I want to suggest that it is precisely the consequences of this theory in action, in its present neoliberal form, that Taibbi has uncovered in his article, the 800 ton Neoliberal gorilla, if you will. My argument is as follows: the [neo]liberal theory of international relations is flawed in one critical sense, namely that it conflates two unrelated explanations for the democratic peace, without attempting to order them in an working causal hierarchy. Despite leading to both shoddy predictions and incorrect analysis, this conflation of explanations allows for almost infinite potential to rationalize and romanticize the policies of a small--yet powerful-- corporate elite. The false promise of Neoliberalism has been responsible for the erosion of American democracy by selling people on the false hope of a "capitalist peace," both at home and abroad, all while telling them it's really about creating a "democratic peace." Hence, there exists no explicit "capitalist democratic peace theory," even though that is the obvious endgame, with the emphasis being on the capitalism. The correct and proper analysis is what I call the "democratic democratic peace theory," which holds that the process of democratic governance is alone what has caused the democratic peace, whereas capitalism has served as a drag on the steady march toward Kant's vision of a perpetual peace, or Fukuyama's neoliberal version of the same theory, The End of History. Neoliberalism, in short, is a bastardization of Kant's original, pre-industrial theories, and he must be turning in his grave at how shrewdly the corporate elites have succeeded in making his ideas the foundation for an ideological regime that makes it seem wrong to challenge them.
The awkward relationship between global capitalism and democratic peace
How is capitalism a drag on any potential global peace? Capitalist states trade together. Doesn't that shift the cost benefit analysis away from war? First of all, the benefits usually don't fall evenly, and traditionally have often maintained a relationship of dependency between the strong and the weak states. Second of all, whoever said that the benefits of war outweigh the costs has obviously never been there. Even in hindsight, there are few wars that were in any way rational in the classic sense to either the decision makers or their society, considering what was at stake (the very existence of the state. Russian roulette is never rational). As a result of this apparent irrationality, the first task of neoliberalism rests on proving that wars can be rational from a regime's standpoint, and they have looked at things like incentives to bluff and conceal information, or issue indivisibility, i.e. things that can't be bargained over because of their very nature (often religious). So indeed, Neoliberal intellectual giants such as James Fearon have devised game theoretical models to prove the point that even though war is a lose-lose endeavor, it is often if not always rational, at least in theory. From there they can apply the rationalist trade argument about the costs of losing the benefits of trade outweighing the potential benefits of war (the spoilz). Let's assume Fearon is right, and war is often rational because of incentives to bluff, incentives to conceal information about intentions, etc. What exactly is it about capitalism that would cause states to hoard less private information, have less bluffing incentives, etc.? Wouldn't it seem more likely that the democratic process (or lack thereof) of the states involved in the conflict would play a greater role in the negotiations to avoid war than the mode of production? Well, someone from the opposite perspective might say, capitalism encourages otherwise-state-owned industries to privatize, and in order to be traded on the US or London stock exchanges, these titans would need to meet certain standards of transparency.
I think this argument is unconvincing, for two reasons. First of all, there is nothing inherently incorruptible about the US stock exchange. S&P and Moody's, whether or not they were on the take, contributed vastly to the collapse of the global economy when they haphazardly [or nefariously] assigned AAA credit ratings to securitized mortgage soup known as collateralized debt obligations, and when they were forced to admit their mistake and downgrade these assets to junk, the global financial system ground to a halt and 50 trillion dollars worth of asset values were destroyed, much of it in the blink of an eye. At the very least, it seems that the Black Scholes induced mania and the numerous other highly complex formulas used to underpin the logic of these products proved as incomprehensible and volatile as war itself.
Second, there is simply a more compelling reason to explain why two democracies would have less incentives to go to war with each other, and one that does not require a priori for these democracies to be capitalist: their regime types are the same, thus making them familiar and trustworthy to one another. This is more along the lines of Kant's central argument about the domestic costs of war being shared with the statesmen of democracies and their polities, as opposed to kings, for example. The argument, you might recall, was that this knowledge leads not only to the election of more peaceful leaders, but also, internationally speaking, it would lead to more trust and security between such leaders and their electorates than could ever exist between two autocracies or (especially) two states of differing regime type. If we buy that, then it would make sense that in such a scenario the incentive to bluff or conceal important information, say about the size of your nuclear arsenals, etc., would be greatly diminished, assuming that statesmen's first priority is to preserve their state's existence and protect their assets. So it is entirely unnecessary, in this view, to take capitalism into account, and even if having more publicly reviewable transactions, companies, etc., are a common symptom of democracy, they are certainly not the cause of democracy. No theorist I have read uses the public tradability of companies as a measure of democracy. Otherwise, China would be high on the list of the world's most democratic states.
The democratic tendency to war
The crucial question that remains then is as follows: how is it that democracies are more war like than autocracies? This I do not attribute to democracy per se but to the free market capitalism that has nearly always accompanied it. There are at least three reasons, then, for this phenomenon. First, wars between democracies and autocracies are usually incredibly asymmetrical and are usually about the extraction of resources by international corporations. So the combination of a low potential for casualties and a high payoff for corporations is usually enough to tip the cost-benefit scale in the favor of war for the decision making regime in the more powerful state (read: the democracy). Iraq II has been widely cited as just such a case, even though Saddam certainly increased his odds of being invaded by bluffing and concealing information, not from the US directly, but from Iran, his main perceived existential concern at the time of the second Iraq invasion.
Second, these corporations have a specific levers of control in capitalist democracies that wouldn't be available to them in non-capitalist democracies: the lobby. There is a very interesting book by Stephen Walt and John Mearsheimer called The Israel lobby and US Foreign Policy that illustrates this point brilliantly. In this book, Professors Mearsheimer and Walt, both highly senior scholars of international relations, seek to understand how the US has developed its extremely counterproductive foreign policy of always backing Israel to the hilt, no matter how badly it behaves. Doing so, they argue, has not only made the Middle East less stable by failing to incentivize Israel to reach a peace agreement with Palestine, it has also made us less safe at home. Indeed, if you read Osama Bin Laden's manifesto, you can hear it from the source: Al Qaeda was formed largely as a response of the US backing of Israel, as well as its military presence on the Saudi Peninsula (which relates to the first reason: resource extraction). The reason the professors discovered for the bloody US policy of always backing Israel in the middle east" You guessed it, lobbyists, and especially, their money, having taken over the political machinery in Washington. Why should we believe that Israel is an isolated case, when there are so many other private interests with significant resources that would benefit from a US crusade?
A third reason that capitalism has led capitalist democracies to be more war-like relates to the crusading nature of US foreign policy: our very notion of liberalism has been warped purposefully by corporate money and influence in education, the media, and both civic and professional life. They (the neoliberals) have led it to become romanticized in the media through the careful weeding out of highly critical dissent. They have portrayed it as a quest to spread freedom across the globe in our school text books. And they have supported leaders who fit the romantic image of a benevolent democratic cowboy eager to spread our western values to the wild wild east, and who are willing to undertake those quixotic crusades at the cost of our low income families who staff our volunteer armed forces, thus setting us apart in letter but not in spirit from the typical dictatorship. Jimmy Carter, Ronald Reagan, Bill Clinton, George W. Bush, and now President Obama stand out in particular. To be sure, there have been Presidents who have resisted their agenda and taken a more reality-based approach to foreign policy: JFK, Bush senior, and Eisenhower, among others. But these are few and far between, precisely because of their failure to buy into the perpetuation of the false notion of liberal capitalism as some universal pacifying force. For example, it is no longer considered a "theory" that there was a conspiracy to kill JFK. in 2030 (or shortly thereafter) we will have access to the full CIA and FBI files on the investigation into his murder, and I can guarantee you that what we find will support my argument. JFK was about to make a major shift away from the US cold war crusades by drawing down our troops in Vietnam when he was killed, as revealed by Robert McNamara in the legendary documentary The Fog Of War. Had he done so it would have been a major blow to the theory of a benevolent, crusading democratic peace. And it would have been brilliant from the standpoint of the American national interest.
And that is the central point: the interest of any nation is always at odds with the powerful few. That's what democracy was designed to protect us from. And ignore those crying about the tyranny of the majority; with proper institutions including a robust free press and fair elections that is silly argument that amounts to an elitist tempest in a teapot. There is just no way to divide that fact, no sugar to coat the satan sandwich that we must all eat when democracy fails us. The US is currently experiencing the most massive stratification of wealth along class and racial lines that it has ever seen. Is it any surprise then that we are acting less and less like a democracy and more and more like the dictator who would send his country to war in a heart beat because he never has to hear about the suffering it would cause his own people? If you've been wondering about the creeping Orwelianism of the surveilance state under the two most recent Presidents of both parties, then wonder no more: dictators use the military against their own people rising up. Flat out. And that's why we haven't done it. People are scared, and they don't fully understand why.
Why Neoliberalism?
The grand myth of neoliberalism is that "a rising tide floats all boats." This can be interpreted as trickle down economics between nations, and is essentially the same as Adam Smith's old "invisible hand of the market, on an international scale. And it is the neoliberal ideology that has led us to the precarious economic situation we find ourselves in. Now, sure, there is very little chance the Senate will reject the debt ceiling deal and thus crash the economy in one fell swoop. That would be too volatile for even the ruling class to manipulate effectively for their advantage. We're in panick mode, nevertheless, because of the economic consequences of austerity in the face of 9% unemployment. As that unemployment becomes more structural, and is replaced by fresh situational unemployment due to depressed demand, and as demand is even further diminished through the significant up front spending cuts in this bill, the consequence will no doubt be an even wider gap in wealth and capabilities between the upper class and the rest of us, and those resources will transfer into even greater political capability for the already-capable, new astro-turf, ALEC-style legislative initiatives at the federal, state, and local level, and less and less overall representation in our system. Kind of like how the universe tends to disorder, entropy is taking its effect on society by polarizing resources with the very few. What will be left? Capitalism, for sure, and we might imagine a state-capitalism, such as China's system, where instead of Marx we are all raised on the cool aid of Locke and Jefferson in school, fully knowing that it was just a bunch of hot air and that the way to get ahead is just to nod and pretend to agree, while always towing the autocratic line. We might also imagine things getting so bad economically that we do eventually default on our loans, and along with the rest of the industrialized world, are forced to sell off the commons to the highest bidder. This is my greatest fear, for in such a closed, privatized system, one has no idea where the massive numbers of poor would go. I could imagine an entire class of people reduced to stray animal treatment very quickly under such a system.
Ideology and theory in such a case becomes completely hollow and serves as a means of controlling the public discourse, nothing more. It's a place holder, providing a basic level of false hope necessary to keep people from getting the feeling that they can start creating their own ideologies without there being some kind of consequences. Ideology in America, on the other hand, may still make a difference, and that is why there is so much work being done on the part of leftist academics and activists to counter the Neoliberal narrative. There is much work to be done in getting these ideas into the mainstream of academic and activist thought, but it is happening. And small parts of the world are seeing a benevolent socialism succeed relatively well against long odds. Bolivia and Venezuela are examples of democratic, non capitalist countries. South America overall has become the most socialist continent in the post-cold war and has not seemed to suffer much for it, indeed has begun to grow and threaten to challenge the neo-colonial influence of the US on its soil. The fact that Europe is ahead of us in this process has demonstrated that there are already mass movements springing up against this very group of people I'm describing. Of course, their center of power is here, and here is where the last battle must take place.
How do we take democracy back from the clutches of predatory capitalism? Surely we need more and better democracy, for democracy is like the water that can extinguish the flames of capitalism run amok. To a point. And here's where I take a slight issue with the "professional left," even the most brilliant and scathing critics of our politics, such as Taibbi. At some point, you have to wield the extra power of an explicit ideology. Democracy can only work if we're united, and ideologies unite us behind various causes. All that is really needed to get a revolution going is for someone like him or Paul Krugman to start shouting this story from the rooftops, and unmasking the contradictions inherent in the Neoliberal theory. I would love to hear Matt Taibbi use the word neoliberalism. In short, they need to take it to the ideological level. And that is precisely what Republicans are afraid will happen. In the following clip, Professor Krugman reveals that he has "inside information" that the Republicans have been sending the word out to their caucus to not take too celebratory of a tone here. Why might that be? Have they suddenly decided to take pity on the President and not embarrass him any further with his base? Not at all. The reason is that they are afraid that we the people will catch on to what Taibbi and Krugman have already identified, and if enough people do, and enough people start discussing, then their control of the dominant ideogical narrative will be threatened, their ideology exposed for the sham it is. So get out there and spread democracy by shouting how shitty this deal is from the rooftops. But think about where the opposition is coming from. By learning about the theory that underpins policy in Washington, and educating your neighbors thereon, you can increase the effectiveness of your efforts tenfold. The Republicans (and Democrats) have gotten away with murder. Don't let them get away with convincing America that they've been doing this for the national interest or the democratic peace.