Sydney Herald, December 31, 2012
IF YOU’VE ever suspected politics is increasingly being run in the interests of big business, I have news: Jeffrey Sachs, a highly respected economist from Columbia University, agrees with you – at least in respect of the United States.
In his book, The Price of Civilisation, he says the US economy is caught in a feedback loop. ”Corporate wealth translates into political power through campaign financing, corporate lobbying and the revolving door of jobs between government and industry; and political power translates into further wealth through tax cuts, deregulation and sweetheart contracts between government and industry. Wealth begets power, and power begets wealth,” he says.
Sachs says four key sectors of US business exemplify this feedback loop and the takeover of political power in America by the ”corporatocracy”.
First is the well-known military-industrial complex. ”As [President] Eisenhower famously warned in his farewell address in January 1961, the linkage of the military and private industry created a political power so pervasive that America has been condemned to militarisation, useless wars and fiscal waste on a scale of many tens of trillions of dollars since then,” he says.
Second is the Wall Street-Washington complex, which has steered the financial system towards control by a few politically powerful Wall Street firms, notably Goldman Sachs, JPMorgan Chase, Citigroup, Morgan Stanley and a handful of other financial firms.
These days, almost every US Treasury secretary – Republican or Democrat – comes from Wall Street and goes back there when his term ends. The close ties between Wall Street and Washington ”paved the way for the 2008 financial crisis and the mega-bailouts that followed, through reckless deregulation followed by an almost complete lack of oversight by government”.
Third is the Big Oil-transport-military complex, which has put the US on the trajectory of heavy oil-imports dependence and a deepening military trap in the Middle East, he says.
”Since the days of John D. Rockefeller and the Standard Oil Trust a century ago, Big Oil has loomed large in American politics and foreign policy. Big Oil teamed up with the automobile industry to steer America away from mass transit and towards gas-guzzling vehicles driving on a nationally financed highway system.”
Big Oil has consistently and successfully fought the intrusion of competition from non-oil energy sources, including nuclear, wind and solar power.
It has been at the side of the Pentagon in making sure that America defends the sea-lanes to the Persian Gulf, in effect ensuring a $US100 billion-plus annual subsidy for a fuel that is otherwise dangerous for national security, Sachs says.
”And Big Oil has played a notorious role in the fight to keep climate change off the US agenda. Exxon-Mobil, Koch Industries and others in the sector have underwritten a generation of anti-scientific propaganda to confuse the American people.”
Fourth is the healthcare industry, America’s largest industry, absorbing no less than 17 per cent of US gross domestic product.
Phi Beta Iota: Corporations — including banks — operate under public charters. The US Government is complicit in this looting because it has chosen to legalize crime (Congress) and to not enforce such regulations as do exist (Executive). The Supreme Court is also corrupt — Citizens United is the culmination of a 20 year campaign by the US Chamber of Commerce and Justice Powell to subvert the Supreme Court. Normally Congress would immediately over-ride dereliction of duty by the Supreme Court, but when all three branches of the federal government and the two political parties that exclude the other six are corrupt to the bone, nothing short of a public revolution will heal the Republic. There are more than four gangs — there is an Agriculture-Water Theft gang that includes Nestle, Coca Cola and Pepsi as well as the bottled waster fraud network, there is a Public Utilities fraud network, and there is a home construction fraud network. It is much, much worse than just four gangs. The USA is a cheating culture suffering from information pathologies in which the truth is called a a lie and a lie is called the truth. On that basis, the USA is borderline comatose.
Bogle, John C. (2005), The Battle for the Soul of Capitalism (Yale University Press)
Greider, William (2004), The Soul of Capitalism: Opening Paths to a Moral Economy (Simon & Schuster)
Smith, Hedrick (2012), Who Stole the American Dream? (Random House).
Taibbi, Matt (2011), Griftopia: A Story of Bankers, Politicians, and the Most Audacious Power Grab in American History (Spiegel & Grau).