US Pathetic

Doug Henwood has a review of the OECD’s current “Social Indicators” at his article “How American Awfulness Stacks Up.”

Apparently, Americans have it pretty crummy, but they’re blithe about it. Hooray for the cable teevee!

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Some utilities splintering off from Chamber of Commerce

Environmental social movement strategy note:

Political efforts to internalize some of the environmental costs of carbon production have already produced something strategically valuable:

Some US utilities have quit the US Chamber of Commerce, as the Chamber has an aggressively pro-climate change/carbon-emissions stance. Some but not all of these dissenting utilities have nuclear holdings and/or have markets in liberal regions.

“What appears to have touched off the utilities’ withdrawals from the chamber was a recent article in The Los Angeles Times that cited chamber officials who called for a ‘Scopes monkey trial of the 21st century’ about the science of climate change. The Scopes trial was a clash of creationists and evolutionists in the 1920s,” explain Clifford Kraus and Kate Galbraith of the New York Times. “The chamber has been especially vocal recently in opposing a proposal by the Environmental Protection Agency to use an existing law, the Clean Air Act, to set limits on greenhouse gases. The proposal would most likely take effect only if Congress failed to pass climate legislation.”

Other major corporations with public image requirements, such as Nike and Johnson & Johnson, have also expressed dissatisfaction with the Chamber and NAM (National Association of Manufacturers) anti-environmental orthodoxy. The 3-million-business-member Chamber of Commerce and the NAM are the US’s premier lobbying organizations on behalf of capital.

Most citizens would reap significant long-term benefit from working with their organizations and movements to put further pressure on companies that support environmental destruction through their affiliation with the Chamber of Commerce and the NAM.

Dollar as world reserve currency

The president of the World Bank Robert B. Zoellick said in a September 28, 2009 speech at Johns Hopkins that the euro and the Chinese renminbi will begin to replace the dollar as the capitalist world’s reserve currency.

Since 1999, the dollar has been decreasing and the euro has been increasing in world foreign exchange reserves. (China has kept its currency out of international circulation so far, but is in discussions with other states regarding replacing the dollar in oil trade.)

Replacing the dollar as the world reserve currency would likely mean the following:

1) Despite its natural and human wealth, the US is not an economic producer. The US’s aging economy is based principally on speculating with capital, as well as oil and oil-based infrastructure and military expenditures. Because imports have exceeded exports, the US has a large trade deficit. The large trade deficit means that the US has borrowed a lot of money from foreign creditors.

When it does not hold the world reserve currency, the US will be unable to negotiate for more favorable terms of debt repayment. This means the cost of debt repayment will increase for US taxpayers. Currently the US public debt is 61% of its annual GDP, and 28% of the public debt is foreign-owned.

The above “Foreign Owners of US Treasury Securities” chart was made by a “US Public Debt” Wikipedia editor using US Treasury data.

2) US taxes will pay foreign creditors. There will be class wars over who is to pay these taxes; but in general working class Americans will experience austerity.

3) If the US dollar is no longer the reserve currency, the US would raise interest rates to attract and maintain foreign capital. This would make it more expensive for Americans to borrow money, reducing US economic growth for the long term.

4) The US may try to let its currency depreciate in order to reduce its debt burden. Creditors may retaliate. Currency depreciation can result in inflation. Imports will be more expensive, and the US produces very little of what it consumes.

5) When the US loses its “exorbitant privilege” (Giscard d’Estaing), the country will be more susceptible to a currency/balance of payments financial crisis, and accompanying speculative attacks on the currency.

Obviously, the US has put its all behind maintaining the dollar’s world reserve currency status. From bucking Keynes to Nixon taking the US off the gold standard to sacrificing balance of payments and domestic production capacity to substituting working class debt for working class income to the imperial military-financial explosion. US dollar, we did it all for you, it was all for you, all along.

Current efforts to maintain the dollar as the world reserve currency are, however, becoming very burdensome, not just on other peoples, but on Americans as well. They include:

1) The bailouts of irresponsible FIRE (finance, insurance, real estate) corporations, such as AIG. These bailouts impose a great tax burden on Americans, which further reduces their discretionary income, diminishing Americans’ role as global consumers. Because human capital is not a competitive advantage of the US, the loss of Americans’ ability to consume will eventually result in lowered socially-necessary wages in the US.

As well, because American taxpayers pay the costs of FIRE capital’s bad business in order to keep the world economy afloat, the bailouts establish emphatic disincentives for FIRE capital to act rationally or in the long-term interest of the US economy. Poor business practices + impoverished taxpayers = reduced incentives to foreign capital to supply capital liquidity to the US.

2) With some encouragement from Israel, which always feels the need for lebensraum, the US fights wars in South Asia when countries such as Iraq and Iran indicate they will switch to doing oil business in euros rather than US dollars. (This results in China switching to more euros.)

This means that a large proportion of US wealth and lives, and the US state, are devoted to and entrenched in military expansion. This economic-dominance-by-military-aggression comes at a terrible cost to US democratic institutions, and narrows the range of policy to address domestic problems. It is unclear whether exorbitant military expenses are balanced out by the extent to which military production stimulates the US economy–metastasizing militarization is famous for pushing stressed societies such as the US to their collapse.

However, what is clear is that as the US economy has become partially dependent upon exporting weaponry and other forms of militarization, the US multiplies the conditions for future conflicts, even as it creates enemies and long-range problems out of whole societies (South Asia, the Islamic world, etc.) That produces more deaths for more impoverished American sons and daughters. The only way to rationalize that domestically is with bigger fascism.

Perhaps you will forgive my cynicism when I say that I sincerely doubt that the US is going to make its fascism conquer all where Germany could not. Will the Russians, inter alia, end up crushing the US machine, if it comes to that? Poor, tortured Russians.

Live by the sword, die by the sword. Recall that on the eve of the 1960s, Daniel Bell proclaimed the end of ideology, and 16 years before the US was about to lose its superpower status, Francis Fukuyama declared the end of history. We should recognize this pattern: Just a bit after conservatives are lullingly smug about having secured their utopia, we will all find ourselves rudely awakened to the fact of capitalism. All that is solid melts into air.

Another 20th c. conservative organizer: Lewis Powell

“(In) Lewis F. Powell Jr.’s 1971 memorandum to the U.S. Chamber of Commerce, ‘Attack on the American Free Enterprise System(,)’ Powell, soon to be a Supreme Court justice, urged friends of capitalism to retake command of public discourse by financing think tanks, reshaping mass media and seeking influence in universities and the judiciary. (Below right, class warrior Lewis F. Powell in full warlock battle regalia.)

This did happen in the decades to follow. What had once been far-right fantasies — abolishing welfare, privatizing Social Security, deregulating banking, embracing preventive war — became legitimate policy positions, emanating from institutions that cost a lot of money to maintain: the Heritage Foundation, the American Enterprise Institute, the Fox News Network, as well as numerous corporate lobbying organizations and university professorships. Money talked.

None of this ideological infrastructure has disappeared. Whether the Obama administration can stand up to its power remains to be seen. Despite popular support for a robust public option in health care coverage and even a single-payer system, the airwaves are pervaded by the buzzwords of the market — competition, incentives, consumer choice. Foreign policy, too, remains dominated by right-wing assumptions. Whatever President Obama’s intentions (and it would be a mistake to underestimate him), he will find the imperial presidency difficult to repudiate. The bureaucratic labyrinths of the national security state will be dismantled no more easily than the hundreds of American military bases around the world, many of them shrouded in secrecy. Nor will it be easy to challenge the assumptions that underlie empire: the ‘humanitarian’ (my scare quotes) dreams of interventionists in Mr. Obama’s own party and the relentless Republican demands for toughness. Here as elsewhere, the right wields far more power than its weak popular support warrants. Reports of its death have been exaggerated.”

Excerpt from a book review by Lears, Jackson. 2009. “The waxing and waning of America’s political right.” The New York Times, September 28.

Toxic Water in the US

To find toxic water releases by US zip code, go to The New York Times’ Find Water Polluters Near You feature.

The US federal government, the EPA, and state governments quietly stopped regulating water quality in the US under the Clinton administration. However, as per law, businesses were still sending the reports of their toxic discharging activities to state governments. Investigative reporter Charles Duhigg led a 10-month effort to analyze languishing water pollution records around the country. On September 12, 2009 The New York Times published investigative reporter Charles Duhigg’s research into US water quality.

The results of Duhigg’s investigation are of course very grim. Without regulation, businesses and city governments have learned to discharge more and more toxic waste into the country’s water supplies.

Our Slavery

In “The slave next door: Human trafficking and slavery in America today,” Amy Goodman interviews slavery expert Kevin Bales on Democracy Now!

Bales estimates some 27 million people labor as slaves today—more than at anytime in history. Bales has also helped expose modern-day slavery in the United States, where he estimates between 14,000 and 17,500 people are trafficked into the country each year. He writes, “There has never been a single day in our America, from its discovery and birth right up to the moment you are reading this sentence, without slavery.”

Magnuson’s "Mindful Economics"

Coming soon, A review of:

Magnuson, Joel. 2007. Mindful economics: How the US economy works, why it matters, and how it could be different. New York: Seven Stories Press.

Fundamentally, this is a book about alienation, capitalist alienation, that Magnuson identifies as the root of major socio-political-economic problems. The separation of ownership and work is the fundamental capitalist alienation. (Magnuson avoids the use of the term alienation. He appears to be an institutional economist.)

The logical, argumentative structure of this book is excellent.