Sunday,
November 4, 12
Precedents of US Democracy
Vote
of sanction and Sub-prime syndrome
Essay on US Presidential elections 2012
"I
leave you, hoping that the lamp of liberty will burn in your bosoms until there
shall no longer be a doubt that all men are created free and equal.” Abraham
Lincoln
"Behind the ostensible
Government sits enthroned an invisible Government, owing no allegiance and
acknowledging no responsibility to the people. To destroy this invisible
Government, to dissolve the unholy alliance between corrupt business and
corrupt politics is the first task of the statesmanship of the day..... This
country belongs to the people. Its resources, its business, its laws, its
institutions, should be utilized, maintained, or altered in whatever manner
will best promote the general interest." Theodore Roosevelt
“No people can live to
itself alone. The unity of all who dwell in freedom is their own sure."
Dwight Eisenhower
“The
test of our progress is not whether we add more to the abundance of those who
have much; it is whether we provide enough for those who have too little.” FDR
The precedent of “Citizen
United” decision by the US Supreme court is “First National Bank of Boston v.
Bellotti Attorney General of Massachusetts” decision in 1978. This case was
brought to the High court by national banking associations and business
corporations. In their opinion, Massachusetts law that prohibited corporations
from spending money to influence the vote was unconstitutional and the US Supreme
court agreed. The decision was a creation of First Amendment Right for
corporations to influence elections. Corporate “free speech” became a new
reality in American democracy. Lewis F. Powell wrote the majority opinion in
“First National Bank of Boston v. Bellotti Attorney General of Massachusetts”. Nixon
nominated him to the US Supreme Court on January 7th, 1972. Lewis F. Powell is
the author of the “Powell
Memo” published August 23, 1971
and “First National Bank of Boston v. Bellotti Attorney General of
Massachusetts” decision was the beginning of the realization of the Powell memo.
This memo is the road map of conquest of power centered on domination of political power, democratic
institutions, public opinion, and privatization without limit of the fabric of
American society. Domination develops inequity, moral weakness and destabilized
democracy. The subjection of peoples is contrary to human well being. Powell memo is a road map to politization
and government of privatization and transform this tool of human development to
an instrument of political domination. Privatization is an instrument of
capitalism. It is one of many instruments, which facilitates the development of
the system, but capitalism is not limited to privatization. Capitalism is a
long-term process of optimal development of human solidarity. The memo is a
political strategy of privatization as a political instrument of domination. Privatization of media and education are key
to this strategy, control of opinion formation, culture and ideology is
essential to conquest of power by a minority. This is why Powell memo has influenced or inspired the creation of many think tank
organizations likes the American Legislative Exchange Council (ALEC), Heritage
Foundation, the Manhattan Institute, the Cato Institute and political activism of some business leaders. The Koch
brothers are first in the line of this effort to control the destiny of
American people with sub-privatization. This is
why activities of republican think tanks have been important in the process of
transformation of bipartisanship and our political culture. The Powell memo is
founded on ignorance and an unhealthy understanding of capitalism. The free
market is not driven by the dualism private sector versus public sector. Both
are interconnected structure of capitalism. Success of industrial-capitalism in
the 20th century was based on harmonization of this interconnection.
Politization of privatization by the Republican Party has created an antagonism
between public and private sector. Free market capitalism cannot be feed with negative
energy of this antagonism because it creates a disruption in the process of
wealth creation. Our economy has been weakening by this disruption and an erosion
of our democracy is the consequence. The market should not an opposition between
corporate interest and democracy or management of conflict between dominants
and subjects. In the 34 pages documents sent to Mr. Sydnor Jr, Chairman
Education Committee US. Chamber of Commerce, Lewis F. Powell wrote “American business and the enterprise system have
been affected as much by the courts as by the executive and legislative branches
of the government. Under our constitutional system, specially with
activist-minded Supreme court, the judiciary may be the most important
instrument for social, economic and political change.” The memo is a degradation of
the institutions of democracy and capitalism in USA. The US judiciary,
legislative and judiciary power are 3 institutions of democracy, and foundations
of free market capitalism. This memo is a deployment of spirit of domination. Social, economic and political changes in
America come from the American people, not from domination of one branch of our
democratic institutions.
The Powell memo is not a reflection of the success of democracy and industrial-capitalism
in USA in 1971. The thinking of Powell is a product of belligerent spirit with
limited understanding of capitalism. Mr. Powell political culture is an
expression of confusion between the political conflict of the cold war and
contradictions inherent to development of capitalism.
American
government has created the biggest and most productive free market capitalist system
in modern history. Powell memo was written in 1971, when Richard Nixon cancelled
the convertibility of US dollar to gold and USA was the world number one free
market economy. The Powel memo is the beginning of an obscure theorization of
capitalism based on degradation of institutions of democracy and industrial-capitalism.
Reagan was elected 40th President of United State of America from
1981 to 1989. His administration plays a very important role in the execution
of the Powell memorandum. The ideological marketing build around the leitmotif
“ Get the government of my back” was essential to transform government to a
political adversary of republicans. Pdt Reagan said:
“The nine most
terrifying words in the English language are, ‘I’m from the government and I’m
here to help.”
“Government's
view of the economy could be summed up in a few short phrases: If it moves, tax
it. If it keeps moving, regulate it. And if it stops moving, subsidize it. “
“Man is not free
unless government is limited”
“Government
exists to protect us from each other. Where government has gone beyond its
limits is in deciding to protect us from ourselves”
“Government's
first duty is to protect the people, not run their lives”
“No government
ever voluntarily reduces itself in size. Government programs, once launched,
never disappear. Actually, a government bureau is the nearest thing to eternal
life we'll ever see on this earth!”.
Reagan
administration was a representation of big government. When PDT Carter left
office in 1980, the
federal government spending was 27.9% of national income. As a skill politician
PDT Reagan criticized Carter on this spending, but
he spend 28.7% of national income at the end
of his term. He spends more than Carter. His budget for the Department of
Education has more than doubled to $22.7 billion, Social Security spending has
risen from $179 billion in 1981 to $269 billion in 1986. The price of farm
programs went from $21.4 billion in 1981 to $51.4 billion in 1987, a 140%
increase. Medicare spending in 1981 was $43.5 billion; in 1987 it was $80
billion. Federal entitlements cost $197.1 billion in 1981, it was $477 billion
in 1987. (1)Big government is at the heart of the republican ideology and their
political strategy of conquest of power is build around this obscure concept.
Democrats have not been able to stifle this concept and demonstrate that the Republican
Party is the party of big government and excessive debt. This is a weakness the
Democrats should correct if they want to make a strong difference with the Republican
Party. In politic you cannot allow your opponent to label you for what you are
not. Republican have been good in labeling democrat has big government and
democrat have not been able to return the favor. To their benefit, they build a
strong political capital with this false political labeling of the Democratic Party.
The Reagan
administration was a political platform of development and execution of the
Powell memorandum, which lead to the beginning of an erosion of institutions of
the republic and disintegration of industrial capitalism in USA. It is was a
period when bipartisanship start to show its limits. The leitmotif “ Get big
government of my back” has created a political culture
to
transform government to an insignificant institution of the republic, but It is
an illusion. The US government is a bureaucracy like any other government in
free market capitalism. But, it is here to stay as an important institution of
democracy and organizational platform of our society. The challenge is not the
size of our government, but the efficiency of this institution of the republic.
We are in a world of performance, innovation, competition and speed. The best
governments in the 21st century will those who will be able to adapt
to these new realities. Creation of Efficient government is our priority.
Development of smart cities will have strong
impact on formation of Efficient government.
Boston, San Jose, San Diego, Austin, Seattle are among the 10 top smart cities
in USA.
Copenhagen-Denmark, Curitiba-Brazil, Barcelona-Spain, Stockholm-Sweden,
Vancouver-Canada are the top 5 smart cities in the world. “Our cities are fast transforming into
artificial ecosystems of interconnected, interdependent intelligent digital
organisms.” William J. Mitchell, (2). Multinational corporations like IBM and CISCO are involve in
development of smart grids in smart cities. Smart grid technologies make
possible construction of new cities from scratch like Songdo City in South
Korea. The city is being build by CISCO. Efficient government is engineer by technology and innovation,
not politic. When capitalism is
confronted by severe crisis, government is the solution. This was the case in
1929 and it was the same for the great depression in 2008. The total US
government bailout for private sector and banks was $ 1.2 trillion on December
5th 2008. US financial institutions borrow money from the US
treasury and the Federal Reserve. Half of the borrowers of the US Federal
Reserve secret lending are foreign banks. Royal Bank of Scotland got $84.5
billion and UBS AG got $77.2 billion from the US Federal Reserve. The
Dodd-Frank Wall Street Reform and Consumer Protection Act mandated GAO one-time
limited audit of the Federal Reserve. The audit reveal a massive corruption, ignore by the US congress,
American people and the media. The Federal Reserve made $16.1 trillion (From December 1, 2007 to July 21, 2010) in secret loans to bankers during the
financial crisis. The total the loans went to Wall Street “too big to
fail” banks and foreign financial institutions received $ 3.8 trillion.
Main Street America did not one dollar from these loans. $16.1 trillion is more
than United State GDP per year, 8 times US federal tax revenues ($ 2.40
trillion) and 5 times our federal revenues ($ 3.54 trillion). The recipients
are: Citigroup – $2.513
trillion, Morgan Stanley – $2.041 trillion, Merrill Lynch – $1.949 trillion, Bank
of America – $1.344 trillion, Barclays PLC – $868 billion, Bear Sterns – $853
billion, Goldman Sachs – $814 billion, Royal Bank of Scotland – $541 billion,
JP Morgan Chase – $391 billion, Deutsche Bank – $354 billion, UBS – $287
billion, Credit Suisse – $262 billion, Lehman Brothers – $183 billion, Bank of
Scotland – $181 billion, BNP Paribas – $175 billion, Wells Fargo – $159
billion, Dexia – $159 billion, Wachovia – $142 billion, Dresdner Bank – $135
billion, Societe Generale – $124 billion (3).The loan is an expression of the US Federal Reserve limitless
power and there is no legislation to limit this power. It is important to point
out that the Federal Reserve is not a government agency, but a private institution.
So, an unaccountable private
monopoly is running our economy. There is nothing democratic in the US Federal
Reserve.
The
US government of the people prevented a total collapse of capitalism created by
private industry. In common sense, an institution that solves existential risk
in human society cannot be the problem. Ideological retardation is the problem.
This government is all us, has a human society if our solidarity was not
deployed many of the financial institutions in Wall Street will not exist after
2008. In the tragedy of this
crisis created by the actions of the private sector, there is a savior. It is
not the private sector, but the US government. A savior cannot be insignificant
or the problem. This savior is all of us, citizen of the United Stated of
America. The precedent of the great recession of 2008 is the great depression
of 1929. A businessman and Republican President Herbert Hoover with
contribution of the financial industry created it. A Democrat President solved
the great depression: Franklin
D. Roosevelt. History repeat it self, the great recession of 2008 happened
under the watch of a republican president and businessman G.W.Bush. Again a
democrat president is correcting his mistakes. An intervention of US government
solve both crises, but it no a big government of a republican administration. Free
market capitalism in a humanism founded on the process of conciliation of
interests of different nature and creation of value in human organization. In January
1914, Henry Ford decision to double the basis rate of pay of his worker to $
5/day is a perfect example of conciliation of interests in capitalism. Henry
Ford decision transforms him to an extremely wealthy man without tax cuts or
government deregulation. He made the following statement after his decision
““We believe in making 20,000 men prosperous and contented rather than follow
the plan of making a few slave drivers in our establishment millionaires”
(Fortune- Alex Taylor III, October 8, 2012-The Greatest Business Decisions of
all time by Verne Harnish). With this decision, Ford has double production, reduce
worker day from 9h to 8h, created a lot of new jobs, expanded consumption and
market, reduce Model T’s price from $800 to $350 and productivity went up from
40% to 70%. Ford understood that capitalism is a process of building human
society in solidarity and harmony. Capitalism is a long-term process of
maturation through different phases of wealth creation and manufacturing of
“made in America’. This is what makes the complexity of the system and his
capacity to give birth to a better future for humanity. It is a harmonized
economic system to building more efficient institutions of the republic,
private sector, education system, media and work force...Etc. This is what industrial-capitalism
has achieved with success in USA for many centuries. The Powell memo lack this
vision to build a better human society, in contrary it is founded on short term
satisfaction of corporate financial interests, depreciation of the institution
of Republic and fragmentation of American society. This understanding is a
limitation of the system. Romney-Ryan
project is a refection of this limitation. Their plan of massive privatization is
a fragmentation and dismantlement of our social fabric. They claim that
Medicare and Social Security are going bankrupt, but it is not true. Social
security will have a surplus of $ 4.3 trillion by 2023 and is expected to pay
out 75 percent of benefits until 2084.
(4). Social security was created by F.D. Roosevelt
in 1935, but republicans never stop to fight for its privatization. It is their
dream gift to a political clientele in Wall Street. Capitalism is a phenomenon
of stabilization of social fabric, the transfer of the management of social
security to the moral hazard of Wall Street will result collapse of our social
organization. Social security is a key stabilizer and an expression of our
solidarity. This transfer will also weaken our institutional power to control
the future our social organization and “wealth of the nation”. Social security
is an important part of the “wealth of nation”. All assets of human
organization cannot be subject to risk of private entities; we are founded on
the “Common good”. Romney-Ryan project is an expression of development of the subprime
syndrome. They are asking American
people to embrace the same policy that is creating so much pain and suffering
since 2008. The
republican concept of privatization is a deployment of human private excess,
this why it is destabilizing American society.
In
the last 40 years, the Powel memo has build has build this concept
and weaken institutions of our democracy and
changed the nature of our national priorities. This memo is a roadmap to
failure of bipartisanship. This is why very few Americans identified themselves
with the US congress. Only 13% of American approved the job of US congress (5).
This
low approval of our elected representative shows the necessity to renew American
democracy. It signals the need for an ideological transformation in our
democracy, the need to become more Americans, less democrats and less republicans.
Innovation in the 21st century, cannot be manage by twentieth
century political system characterized by immobilism. Renewal of American
democracy cannot be done with out an engineering of new Industrialization of
America and production of “made in America”. But, our Democracy is dominated by
a power struggle between Democrats and Republicans that limit innovation. The interests
of American people are no longer the priority of bipartisanship. The dualism of
this political structure is fuel by apolitical antagonism define by the will to
dominate political power. This domination can be achieved through accession or
conquest of power. In democracy, this political objective can only be achieved
by accession to power by universal suffrage, expression of the people's trust
in individual sovereignty to represent their interests. Universal suffrage is result
of delegation of power and foundation of democracy. Conquest of power is the
anti-thesis of democracy; it is founded on annihilation of democratic process. Temptation
to conquest of power is
inherent to all human organization and human nature. The history of human
society is the history of domination, and society mature with demarcation from
domination. This is why democracy is set up on a mechanism of control,
alternation and transparency of power such as political term limits and the
principle of separation of power. The objective of these two mechanisms is to
prevent the existence of any form of domination and permanent political power
in the hands of a single individual or group of individuals. Permanence of power
weakens democracy. This is the political phenomenon we are witnessing today in
American democracy. Bipartisanship is permanence and domination of political
power and the US legislature and judiciary are 2 institutions characterized by
this permanence of power. The lack of term limitation in these two institutions
of our democracy is source of the dynamics of conquest of power initiated by
the Republican in the last 40 years. The permanence of political power of sovereign
individuals in our legislature and judiciary is an erosion of democratic values
and development of political culture of self-identification to supreme
political power. But, the dynamic of conquest of power developed within the Republican
Party, because this party is more sensitive to political innovation and
progress of democracy. The Republican Party also develops for many decades a
political culture of identification to the private sector. This self-identification
explain why they sympathy for democracy is low. Democracy is founded on dynamic
of political innovation, but the conservatism of Grover Norquist Republicans is not compatible
with the creative character of democracy, specially when we are moving in the
phenomenal world of knowledge society in the 21st century.
The presidential
election of November 2012 will be an important test for
Grover Norquist Republicans
to conquest power in America. The culture of conquest of power is not new in
this party. The Powell memo was an ideological legitimation of this culture.
November 2012 is frame by the opponents of Obama to legitimate the selection of
Romney as PDT of USA. Selection of Bush in 2000 was a precedent.
The dynamic of
conquest of power is defined by selection not election of the President.
November 2012 will be a test for the republican project
to weaken universal
suffrage and institutions of the republic in USA. The emergence and convergence
of these two factors create an incompatibility of bipartisanship with the
requirements of democracy in the 21st century. Tentative of
conquest of power
and degradation of democracy are the two most important political risk of
bipartisanship.
This political structure has a propensity to transform productive symmetric relationship
into an irreversible and unproductive asymmetry. Deterioration of political
relations between the 2 parties is the consequence of this political risk. An
exacerbation of this deterioration can lead to the development of irreversible antagonism.
November 2012 presidential election is driven by an antagonism of Grover Norquist
Republicans toward President Obama and American democracy. Our political system
is now experiencing a fundamental transformation; it is a field of expression of republican political antagonism
and erosion of our democratic values. In this analysis, it is prudent to make a
clear distinction between the republican party of Abraham Lincoln and Theodor
Roosevelt and the current party of Mitch McConnell and John Boehner. I call the
current Republican Party: “Grover Norquist Republicans” (GNR). The signature of
Grover Norquist Tax pledge by the republican leadership is an ideological
rupture inside the Republican Party and seal the division of our nation. The
division of our nation in two blogs characterized 2012 presidential elections.
On November 7th, the President of the United States of America will
have the political obligation the make us more Americans, less Republicans and
less Democrats.
The
USA became the world number one democracy and free market capitalist system with
the help of a productive bipartisanship, in which antagonism was non-existent.
Bipartisanship was a fertile structure of political collaboration between
democrats and republicans. But, it has been loosing gradually this political
fertility since the 1st publication of the Powell memo in 1971 and
reach the level of irreversible antagonism during the great recession of 2008,
the election of Obama and emergence of T-party. This political and ideological
mutation transformed the political culture of cooperation between Republicans
and Democrats to a culture of confrontation and put the management of the
interests of American people in secondary position. The ideological rupture
with the original Republican Party and illusion of privatization lead to the
transformation of American economy to a society of debt. Grover Norquist
republican are the principal architect of the public and private indebtedness of
America and degradation of our economy. Debt is not a human virtue, but rather
a restriction of freedoms and leads to destabilization of human organization. A
political party cannot claim freedom when his political agenda create excessive
private debt. This is the case of the current Republican Party. When George W.
Bush was selected President, the federal government was running a surplus of
$86 billion inherited from the Clinton administration. Bush turned it into a
$642 billion deficit at the end of his 2nd term. PDT Obama spend
less than any United States president since Dwight D. Eisenhower. During
Obama’s 1st term, federal spending is on track to rise from $3.52
trillion to $3.58 trillion, an annualized increase of just 0.4%. But, Bush score
7.3% and 8.1% and Reagan 8.7% and 4.9%. (6). So, the big government and big
spender are republican presidents Bush and Reagan. The Republican Party has
been very good to make Americans believe the contrary, but democrats are very
weak to defend their own record. This is a terrible weakness of the Democratic
Party.
The
republican Party of Abraham Lincoln, Ulysses S. Grant, Theodore Roosevelt, Dwight
D. Eisenhower was a party of wealth creation, strong ethic, industrialization
of America, production of “made in America”, mass employment and low debt. It
was a party of unity and solidarity for prosperity and well-being of all Americans.
Historian shows how Lincoln leadership is define by the preservation of the Union
and end of slavery. He established our national currency and national banking
system with the signature of National Banking Act in 1863. The leadership model
of the 16th President of the United State of America was based on
freedom and union, but this model is not represented in the republican party of
Grover Norquist. The first
American PDT to win the Nobel Prize was Roosevelt. He was the 26th
President of the United State of America. TR developed the United State sea
power with the creation of the navy and expanded the presence of USA in the world.
Theodore
Roosevelt naval diplomacy plays an important role in the emergence of USA as a
world power. He was the
peacemaker in the russo-japanese war (Feb, 1904-Sep 1905). Theodore Roosevelt
created 150 National Forests, 5 National Parks, 18 National Monuments, 4 National
Game Preserves, 21 Reclamation Projects, and 51 Federal Bird Reservations. In today’s political
culture his leadership in conservation of nature will be identified as environmentalism.
But, the Republican Party does not embrace his excellent culture of protection
of environment, peace and world affairs. TR created 230 million acres of federally protected land. He identified
himself as a representative of all American and wrote 35 books. But, the
republicans of Romney identified themself as a representative of big money. Dwight D. Eisenhower was 34th
President of the USA. He was a peacemaker and manages not to go to war in a
period of cold war when multiples crisis could create a nuclear war. The
success of his fiscal policy lead to prosperity in America. He balanced the
budget three times, refused to cut taxes and raise defense spending. Dwight D.
Eisenhower ends the Korean
War (1953) and created the Interstate Highway System in 1956. He sponsored and signed the Civil Rights
Bill of 1957. None of his accomplishments are close to the Republican Party. Eisenhower balanced the
budget three times, but recent republican president like Bush and Reagan was
skill deficit creator. The
Bureau of Labor Statistics shows that the federal deficit doubled
under Reagan, going from $790 billion to $1.55 trillion. Dwight D. Eisenhower skill of peacemaker is not an inspiration for the current Republican
Party. Dwight
D. Eisenhower refused to cut taxes and raise defense spending; this is a huge
difference with the current Republican Party. This
brief description of accomplishment of past republican presidents demonstrated
the phenomenal contribution of the Republican Party to the success of American
capitalism, but also demonstrates an important ideological rupture with the
republican leadership of Grover Norquist, the Koch brothers and Sheldon
Adelson.
American
dream is not possible with Grover Norquist Republicans. We are now a country of
deindustrialization, destruction of “wealth of the nation” and gradual dismantlement
of American democracy. The ideological shift triggered in the last 40 years by engineering
of self-regulatory society, Ann Rand mediocre novel, Powell memo established
strong limitations to the future of American society and create a dynamic of formation
of sub-capitalism which is a degradation of capitalism. The phenomenon of
sub-capitalism is unique to industrialized nations. It is characterized by deindustrialization
and financialization. It is a degradation of economic success. But, it is not
new in world history. The consequences of sub-capitalism are constant economic
crisis, exacerbation of social disequilibrium, destruction of “wealth of
nation”, massive creation of debt and depreciation of democracy. Globally, the
great recession has destroyed $ 34.4
trillion of wealth.
(7). Certain research
indicated the figure of $ 50 trillion in 2012, as this crisis is not over yet.
In the US, wealth destruction is evaluated at least $12.8 trillion in estimated
actual and avoided GDP loss, $19 trillion of household wealth was lost from July
2007 when it was evaluated at $74 trillion to January 2009 when it was $55
trillion. The great recession destroyed
of $7 trillion in homeowner equity and 40% of American family’s net worth was
lost from 2007 to 2010(8).
Our economy has lost approximately 42,400 factories since 2001 and 90,000
manufacturing companies could disappear if a strong national manufacturing
strategy is not in place (9). Rep. Betty Sutton (D-OH) estimated a higher
number of 56,190 and 15 factory closure per day and 5 to 6 million jobs have been
lost during the same period of Bush presidency. 33% decline of share of total
manufacturing jobs exceeded the rate of loss in the Great Depression, which was
30.9%. Social cost of deindustrialization is extremely high. It has trigger a
process of dismantlement of our social fabric with massive unemployment,
reduction of amount of taxes collected by public authorities, lack of health
care, weak education, increase of level of social disruption and violence. All
these inadequacies are elements of development of sub-capitalism in USA. In
1970, 27% of the U.S. work force held jobs in manufacturing; in 2012 it is a
third: 9% (12 millions American). From January 2000 to January 2010,
manufacturing jobs fell by 6.17 million, or 34 %. This sector represented 27%
of US GDP in 1950, 23% in 1970, 14% in 2000 and 11% (1.7 trillion in
value/year) in 2011 (10).
If considered as an economy, US manufacturing sector is the 8th
largest economy in the world with 22% of the world output. (11). Manufacturing
is an employment multiplier. The Milken Institute report: Manufacturing 2.0 (June
2009) demonstrated that 2.5 jobs are created from every manufacturing job and
every computer-manufacturing job created 15 jobs outside the factory. In their
publication: The information technology & innovation foundation (APRIL 2011),
Stepen J. Ezell and Robert D. Atkinson explains: “From 2000 to 2008,
manufacturing investment as a proportion of GDP was on average lower in the
United States than in most competitor countries. And from 2000 to 2009, capital
investment within the United States by U.S. manufacturers declined over 7
percent. The declines were steep in many industries. Paper declined by 29
percent, motor vehicles by 42 percent, furniture by 50 percent, and apparel by
73 percent. Even sectors that the United States is supposed to lead in saw
declines, with computers and electronic products down 4 percent and chemicals
down 13 percent”. Income
inequality is at a level never reached in our modern history. Increase in
income inequality is an important sign of failure of bipartisanship and
financial-capitalism. Development of inequity destabilized human organization. From
1992 to 2007 the top 400 earners in the U.S saw their income increase by 392%. One
percent of the US population make an average $ 27 million per year and their
wealth increase by an average $600,000/ year, but the bottom 90 % make an
average $31,244/year and lost 6000/year. Two third of American net worth is
control 10% of US population. Since 1950 payroll tax increase from 12% to 43%
but corporate tax decrease from 27% to 8% (12). Economists, David Moss of the
Harvard Business School commented:
“It is also
striking that the two peaks in inequality occurred in 1928 and 2007 – in each
case immediately before a major financial crisis”
“Bank failures and
financial crises were common in the U.S. until 1933. Then federal financial regulation
was dramatically strengthened (starting in 1933). Bank failures and financial
crises virtually disappeared after that, for nearly 50 years, but reappeared
after financial deregulation commenced beginning in the 1980s” (13).
Deindustrialization
is a massive destruction of private sector, and republicans initiated it. This
reality demonstrate that republicans do not support the real free market
capitalism, but a political clientele operating in the private sector to access
means of acquisition of power. Growing inequality and deindustrialization are
two majors failure of bipartisanship. Health of human organization can be
measure by the level of gap in income inequality. When this level increase health
of human society will depreciate. This is the reality of United State of
America in this second decade of the 21st century.
The campaign for
November elections is not a display of solutions or a road map for reduction of
inequality in America. 2012 presidential campaign is a sum of exposes of
economic policy defines by “cuts” in government spending. Punishment and humiliation of
American people is the only solution for the republicans, this why Romney-Ryan
is focus on cuts. This bad solution is dismantling the fabric of our society. Americans
are learning every day how they are being punished and humiliated; and how this
treatment should continue for the next 4 years with more “cuts” in education, health
care, transportations, Social Security, Medicare, Medicaid, food stamps, police
forces, firefighter, school and teachers. Republicans cuts will also eliminate
Social Services Block Grants, a $1.7 billion a year program that gives states
money for Meals on Wheels, day care, adoption assistance, and transportation help
for the elderly and disabled (14). Cuts will also include $156 million from the Centers for Disease
Control's funding for immunization and respiratory diseases. The consequences
of this cut will lower vaccination rates and result in more outbreaks that
endanger public health. Special
education grants to states will be cut by $1.4 billion, or 11 %. The lack of humanism an economic growth in
this economic policy will fracture the health of American society. Leadership
without plan for future prosperity will be a huge handicap in our economy and lower
our level of competitivity in the world. But, Romney would like to increase our military budget by $2,1 trillion
over the next 10 years, if selected as President. Great leaders guide their
people to more not less.
“Cuts” endanger our society with a meticulous process
of piece-by-piece dismantlement of our social cohesion. Great leaders do not
lead their people in austerity but to prosperity. Great leader increase “wealth
of nation”, expand freedom and democracy. They do not restrict right to vote and
women right. Great political leaders build bright the future. Cuts are
obstruction to clear vision for the future; this is why the electoral campaign
is not full of optimism. 2012 presidential campaign is an expression of failure
of bipartisanship. By nature, electoral campaign is a period of confrontation
of the best ideas and a display of limitless possibilities of the future. The
American people do not deserve a political campaign dominated by restriction of
freedom and wealth. But, Grover Nor Quist Republican (15) attempt to conquest
power by restriction of freedom and wealth is the main reason of lack of clear vision
for the future in this campaign. Conqueror of power does not have any interest
in creation of better future for the people. The future is only defined by his success
to conquest power. We are in a Machiavellian situation. Conqueror of power
cannot develop a coherent theory of management of human society. This is not
their goal, it explains Romney’s inconsistencies in all his positions. This why
Romney-Ryan cannot develop a coherent and rational political theory and give
any specifics in fiscal policy and economic growth. His only rational is the
illusion of his right to control power and entitlement to power. The conqueror
of power think he is the power and does not have to explain why.
This
ideology is not new in the culture of the Republican Party. It has been in
development since the publication of Powell memo in 1971. It is the ideology of
creation of what Machiavelli call “new Principality”. Moral and ethical rules
are discarded and conquest of power is executed with fortune and inequity. Romney’s
conquest of power in November 2012 is base on lack of moral and ethical rule,
but full of money and inequity. The republican candidate is a perfect
representation of anti-democracy, but could be the next President of United
States of America. Machiavelli wrote: "Such princes stand simply upon the
will and fortune of whoever conceded it to them, which are two most voluble and
unstable things: and they do not know how and they have not the power to hold
that rank: they do not know, because, if he is not a man of great genius and
virtue, it is not reasonable that, having always lived in private fortune, he
knows how to command; they cannot, because they do not have forces that might
be friendly and faithful to them. Moreover, the states that come right away,
like all other things of nature that are born and grow fast, cannot have their
roots and connections, so that the first adverse circumstances extinguish
them...” (16). This
ideology has grown and develop in the last 40 years in American democracy and the
leadership of the Democratic party have not able to stop its dynamic. It is a
demonstration of terrible ideological weakness in the elite of the Democratic Party.
Republicans knows how to capitalize on this ideological weakness, this is why
they are always competitive in moment of elections. The republican political
brand is at a very low level, but have very strong presence in American
political culture. To solve this problem the Democratic Party leadership must
initiate a new strategy of ideological marketing and much more aggressive
political offensive attack. Restrictions of freedom by introduction of voter ID
law and ban of abortion are key objective of conquest of power to disrupted
society of freedom. This disruption is more challenging for a sitting president
because he has a record to defend. We can understand the swings in the
Democrats rhetoric in 3 directions: define a clear plan for the next 4 years,
fight the great recession and defeat Romney-Ryan disruption of freedom. Our
national conversation should be centered on positives solutions to the great
recession and definition of our future in the digital world. Disruption of freedom
by destruction of achievements of our democracy has change the nature of the
political message and presidential elections. The dynamic of this disruption will
exacerbate the crisis of American society. The strategy of conquest of power is
founded on exploitation of economic, political and social chaos because this
type of situation is fertile to political realization of vote of sanction. Romney-Ryan candidature to the
presidency and vice presidency of United State of America is structured on the
political possibility of vote of sanction by American and make Obama a one term
president because of high unemployment rate; 7.9% in October 2012. But, his 1st
term is full of performances; his consistently create jobs since he was elected
President. 4.5 millions jobs was created by his administration. Vote of
sanction is the biggest political risk for Obama, and Romney’s strategy is
based only on the realization of this vote. It can happen and Obama will have
only himself to blame. No doubt, PDT Obama’s realization are very importants, but
he did not reach the level of job creation that will satisfied the American
people. He could achieve a better unemployment rate, if FDR model of
infrastructure and public work was implemented. Our nation infrastructure is
collapsing and need to be renewed. Investment in infrastructure will help
increase our competitivity in the global economy. It is always very risky for a
President not to implemented precedent historic and successful models. FDR
model of economic success was very present in Obama’s 2008 campaign. But,
President Obama took the risk not to follow FDR model. This is one of the
reasons why his economic policy have not
reach better result in job creation. The
resemblance between the two crises is enormous. If Obama is elected with the
current unemployment rate of 7.9%, he will create a precedent in high
unemployment rate after WW II. PDT Reagan was elected with 7.4%. Obama has
already created a precedent in US history by being the 1st black
President. November 2012 elections is more than a challenge for the reelection
of Obama, it is about preservation of achievements of our democracy. These
rights are the foundation of our democracy and free market capitalism. Elimination or restriction of these rights reinforce
the development a new form of capitalism: sub-capitalism, because it
move our economy out of the boundaries of capitalism. Sub-capitalism is a
limited form of capitalism in advance democracy. This is what makes November
2012 presidential elections a very unique political competition in modern
history of United State of America and democracy in the world. We are in the 21st
century; new boundaries of democracy in the world are opening. Millions of
people around the world are just starting to experience democracy and the world
most mature and sophisticated democracy is challenge with return to
anti-democracy. This one the most astonishing paradox of the 21st
century, but democracy is a permanent fight. The dynamic of the Arab revolution
is a perfect demonstration of expansion of democracy and freedom in the world. The
new sphere of digital world has raise the nature of unity of human community to
a level never reach before in human history. But, the world most powerful
nation is moving in the opposite direction. This new paradox is a precedent in
the history of democracy: emergence of anti-democracy in the world most
efficient free market. This paradox will undermine the standing of United State
of America as a world leader. Our position has world leader will face more challenges
if our democracy is guided by restriction of freedom.
It
should not be a surprise if Romney wins the elections. Anti-democratic
leadership could emerge in moment of severe human crisis, and the United State
of America is not immune from establishment of a political power that will end
equality between the citizens of our republic. Lilly Ledbetter Fair Pay Act established equality of pay between women
and men in the work place, but
Romney stated clearly that he would not support it. Obama signed lilly Ledbetter Fair Pay Act
into law in 2009. Romney position shows that GNR are not for equality between
women and men. The Senate republican bloc (52-47) in June 2012 the "Paycheck
Fairness Act,” introduce by Sen. Barbara Mikulski, D-Md. The goal of this bill
was to strengthen equal pay between women and men. In Machiavelli’s new
principality, power is conquest with inequity.
The
world is experiencing a phenomenal moment of transformation with creation of
the digital sphere. In this new sphere of development of human
intelligence, prosperity
of nations will be inevitably founded on our ability to manage new complex
systems. This crucial moment of transformation will give birth to a new
capitalist system. Financial-capitalism is a transition to this new form of
capitalism. Management of knowledge is a determinant of the new capitalism of
the future. It is
opening extraordinary new frontiers to wealth
creation and will strengthen human solidarity. The USA is the world center of
knowledge and development of its applications. We are the country that created
the Internet, GPS, the computer, Apple, Microsoft, Google, Facebook, Twitter,
Dell….Ect. We are the creator of the new digital sphere that is give limitless
possibilities to our future. Our new challenge is to conciliate the digital
sphere with new industrial-capitalism and create a new model of capitalism:
renaissance of industrial capitalism. Financial-capitalism has fail. It is a
capitalism of experimentation of illusion of self-regulatory society and deindustrialization.
We are human and we cannot lose leadership control of our destiny. The United
States of America lost the first 2 decades of the 3rd millennium,
and the last 3 decades of the 20th century was a period of dismantlement of
industrial-capitalism. Wealth creation and growth is at the center of
capitalism. Our capacity of wealth creation is gradually diminishing; this is why
it is imperative to engineer the renaissance of American industrialism. It is a
“sine qua non” condition for the return of America to a society of wealth
creation and production “made in America”. Production of less wealth and gradual
disappearance of “made in America” is making our free market less healthy. This
is the fundamental characteristic of United State of America in the beginning
of this millennium. Therefore, return to an optimal level of wealth creation is
the most important challenge of American society, but it is not at the center
of our national conversation for the election of the next American president in
November 2012. Lack of focus on wealth creation lower the quality of our national
conversation. The best way to lower our debt is not to punished American people
with inhuman cuts but to create more wealth by manufacturing “made in America”.
The success of the next commander in Chief will depend on the ability of his
administration to engineer new wealth creation in America. He will not have the
honor of historians, if he leads our nation only in a series of cuts to punish
American people. A Romney administration will be a punisher of American people.
His political agenda is a marathon of cuts and restriction of freedom. Wealth
creation is not a priority for conqueror of power. A second term of President
Obama will leads to wealth creation. He is already in this trajectory. Obama’s
first term was not a big transformative moment because of lack of engineering
of new policy of industrial renaissance in America. He will be a transformative
President, only if he can follow the steps of FDR and engineered such a policy
in his 2nd term. PDT Obama could simply follow the model of
F.D.Roosevelt and engineer a new stream of new industrial production and
infrastructure development. The possibilities was there in the 1st two
years of his presidency, but he did not.
Powell
memo was not about wealth creation and industrialization of America. Illusions of
Ann Rand mediocre novels have the same characteristics. But, both strongly
shape the political culture of the Republican Party and key decision makers of
American economy. Alan Greenspan was strongly influence by Ann Rand, this is
why the former Fed chairman lead our economy to disaster. Greenspan supported the
repeal of Glass-Steagall signed into law by PDT Clinton on November 12th,
1999.
The new law Gramm–Leach–Bliley
Act was the
result of $300 million worth of
lobbying in 25 years. This
invest yield trillions for Wall Street. Paul Ryan, the current republican vice president
candidate is influence by Ayn Rand intellectual deficiency. The emergence of
her inhuman individualism in the sphere of republican political thinking is an
ideological rupture with the American values and vision of the founding fathers
of USA. Our nation was founded on extraordinary solidarity, that is why we have
always overcome all challenges in the process of building a nation that has
inspire the rest of the world. As Americans, our fundamental source of
ideological strength and political inspiration came from the founding father of
the United State of America like John Adams, Benjamin Franklin, Alexander
Hamilton, John Jay, Thomas Jefferson, James Madison, and George Washington. By
turning their backs to our most important source of ideological strength, the
current elite of GNR betrayed our American values define by the founding fathers.
This ideological betrayal is at the origin of the republican party transformation
to a political organization submitted to short-term profit, inspire by the objectivism
of Ayn Rand responsibility is the anti-thesis of our American values of solidarity,
cohesion, sacrifice, success, unity, freedom, democracy, industrialization and well-being.
Americans do not need a mediocre writer to teach them about personal
responsibility. The great recession has demonstrated that Ann Ryan theory is a
total failure and is at the origin of the transformation of our nation to a
debt-nation. Debt is a restriction of freedom and indebtedness weaken human
organization. Our country is founded on personal responsibility to build a
strong nation and efficient free market capitalism. American values are founded
on strong personal responsibility to build an independent nation, stable
democracy and freedom.
The dynamic of human solidarity is at the
origin of success of capitalism. Process of wealth creation is a deployment of
many human activities with different nature. Solidarity cements those
activities to produce wealth and well being for all American. That is how
America was build, and why we have been very successful to create an industrial-capitalism,
society of freedom and democracy in which every American is a valuable asset. For
centuries, we fought for freedom, liberty, unity, social cohesion and
prosperity with personal responsibility. Free market capitalism was build
through a succession of different historical periods by the sacrifice, ingenuity,
solidary and peace of American people. The process was sustained by high morals
value, backbone of industrial-capitalism success. But, financial-capitalism is
a phenomenal depreciation of moral values; this is what explains our transformation
from a producing nation of wealth to a producing nation of debt. The founding
fathers of our nation demonstrated high moral value. But, these values are
missing in 2012 bipartisanship and they are also missing in financial-
capitalism. Benjamin Franklin theorization of moral perfection is more actual
than ever. He wrote: "It
was about this time I conceiv'd the bold and arduous Project of arriving at
moral Perfection." His 13 virtues are model of moral values and better
road map to success than Powell memo and Ayn Rand illusion. Weakness of moral
values is a failure of bipartisanship. Human society growth and develop with
execution of historical and successful models. It is often a mistake, when they
are not implemented.
American
capitalism was not created by collection of private entrepreneurs or a group of
private investors looking for short-term profit. Our society is founded on the
common unless a GNR can demonstrate that our nation is a private entity or
should be a private property. American industrial-capitalism was created with vision,
work and sacrifice of American people. It is a process of valorization of every
American. The Powell memorandum has trigger development of an ideology, which
downgrades American citizen and worker. Industrial-capitalism is founded on
valorization of human being. Leading capitalism to the opposite direction has weakened
the system and give birth to society of debt. The great recession is a result
of depreciation of American people. It is defined by an increase of public and
private debt in USA. But the crisis has been trigger by an extraordinary
increase of private debt: sub-prime loan and securitization. But, GNR does not
want Americans to focus on the danger of private debt and commoditization our
lives. The ideology of privatization develop by the republican elite is to make
Americans more dependent of the private sector. Conquest of power is centered
on reduction of freedom. Capitalism is not a process to create dependency
between citizen of the republic and private sector. Increase of private debt
creates a relationship of domination and submission and fracture capitalism. Commoditizations
of human activities weaken individual sovereignty and gradually create an
erosion of democracy. The process creates synthetic wealth with risk that we cannot
be control. This is one the key characteristic of financial capitalism and
explains why we are constantly hurt by severe economic crisis. We have a total
debt to GPD ratio of 279% (17). This combine public and private debt more than
double from $ 26 trillion in 2000 to 54 trillions in 2008 and decrease to $
52,554 trillion in June, 2011 representing 350,4% of our GDP (18). Our gross federal debt is
$16.4 trillion and projected to be $17.5 trillion in 2013. From 2000 to 2008,
under President Bush, Federal spending rose by $1.3 trillion, from $1.9
trillion a year to $3.2 trillion a year. From 2009 to 2012, meanwhile, under President
Obama, federal spending has risen by $600 billion, from $3.2 trillion a year to
$3.8 trillion a year. This data shows that big government is a creation of
republican administration. In the last
12 years our federal revenue is in decline, this is one of the reasons of our
public debt. In 2000 federal revenues represented $ 2,025.2 b (20.6% of GDP),
in 2008 it was $2,524.0 b (17.5% of GDP). Those revenues represented 14.9% of
GDP in 2009, the level of 1950 when it was 14.4%. We saw a very small increase
to 15% and16% in 2010 and 2011 (19). Corporate
tax loophole plays an important role in the decline of federal revenues. In 1952, corporate income taxes were responsible
for 32.1% of all federal tax revenue but in 2009 it was only 8.9%. But at the
same time payroll taxes
increase from 9.7% to 40%. (20).
Corporate taxes loopholes cost US taxpayer about $100b/year. We can
increase the income of our federal government if we close corporate tax loophole. The
money is available, and big part of this money it is not in USA. Corporate
taxes are less than 10% of federal revenues. A company like Microsoft avoided at least $6.5 billion in taxes using offshore
transactions and transfer
pricing process.
We have the highest marginal
corporate tax rate in the world: 39.2% but US corporations are not paying this
rate. David Cay Johnston (Pulitzer Prize-winning reporter and author) explains
on The Daily Ticker: “A 1909 law requires that companies not hold more cash
than needed to reasonably run their business. If they don't re-invest the extra
cash into the business or pay dividends, they face a 15% penalty.
President Reagan added a loophole to the law allowing companies to avoid
the 15 percent penalty if they hold the extra funds offshore. Using that
loophole, companies like and Hewlett-Packard can borrow against some of those
foreign assets ehole also reducing their tax liability”. The Senate's Permanent
Subcommittee on Investigations hearing on Offshore Profit Shifting and the U.S.
Tax Code shows that U.S. multinational corporations have $1.7 trillion in
earnings offshore. The Senate's Permanent Subcommittee also indicate: “For Fiscal Years 2009, 2010
and 2011, Apple has been able to defer taxes on over $35.4 billion in offshore
passive income covered by Subpart F. Google has deferred over $24.2
billion in the same period. For Microsoft, the number is $21 billion”(21).
Decline of
federal revenues is a very good news for republican conquerors of power. Low
revenues put fiscal pressure on the US government, because it limits the
possibilities of the US government to spend money and should consequently lead
to a substantial reduction of the capacity of US government. This is the heart
of GNR economic and political thinking, it is called: Starving the beast (STB),
an idea that emerges in the 70s. The objective is to weaken to the maximum the
presence of US government in the management of affairs of American people. Starving
the beast is a process of
transfer of this management to privates entities. The objective is to turn the
US government to an insignificant institution, privatize human affairs and weakening
American democracy. Human society and free market capitalism are founded on the
common, transferring management of people affairs to private entities will diminished
democracy and created sub-capitalism. Government is not a political adversary.
It is one the 3 institutions of democracy. Government is a platform of democratic
management of human organization and free market capitalism. This is the
responsibility of government. But, Starving the beast is a destruction
of this responsibility. Politization of Government by republicans is a
political retardation and ignorance. This politization has totally mystified
our national objective and divides our nation by the obscure concept of “small
government” and “big government”. Our national objective is to create more
wealth and better well-being for all American, not to develop bellicose
relationship with our own democratic institution. Small government or big
government is pure illusion. Neither of these two governments has existed in
the history of democracy. This is political thinking weaken institutions of our republic with
development of political culture against government. It is easier to conquest
power when people turn against their own government. The strategy to weaken
government has been growing since the publication of Powell memo. Government is
not an anti-thesis of private sector, it is all of us.
"The
will of the people is the only legitimate foundation of any government, and to
protect its free expression should be our first object." Thomas Jefferson.
"No
man is good enough to govern another man without that other's consent."
Abraham Lincoln
PDT
Dwight David Eisenhower said: "People in the long run are going to do more
to promote peace than governments."
The
US government is the biggest creator of private sector in the history of modern
capitalism. Government has the responsibility to protect our nation and responsibility
of government is also to develop and manage our nation democracy and economy.
Politization of government is centered on government debt, but not on private
debt. Republicans conquerors of power do not like to talk about private debt in
the USA because it is an instrument of conquest of power. Private debt is the
biggest treat to our economic. We are in the great depression because of the
mounting excess and risks of private debt. Sub-prime loan are private debt. Our
total private debt is $ 40 trillion and growing (22). The great depression and recession are
the only 2 periods when the ratio debt to GDP is over 150% total private debt
to GDP ratio (23).
These 2 crisis are the only two periods in the past century that were preceded
by more than 40 % decade of growth in private debt to GDP ratio. This crisis is
not a crisis of public debt, but a crisis of private debt and bipartisanship. The
USA was an AAA country since 1917, but we lost this statute on August 5th,
2011. Failure of leadership is the reason of this downgrade. Standard &
Poor’s (S&P) downgrade of our sovereign credit rating because of political risks and rising debt
burden. Standard
& Poor’s stated the following: “ the downgrade reflects our view that the effectiveness,
stability, and predictability of American policymaking and political
institutions have weakened at a time of ongoing fiscal and economic challenges
to a degree more than we envisioned when we assigned a negative outlook to the
rating on April 18, 2011” (24). Identification of USA as a country of political
risk is a new phenomenon. The decision Standard & Poor highlighted the weakness
of our democratic institutions and failure of bipartisanship. But, this
downgrade did not hurt the safety of US treasury, foreign holdings of our
Treasuries rose to $5.26 trillion in May 2012 up from $4.7 trillion in July of
2011 (25) and the 10-Year U.S. Treasury Note was at 1,75% on November 2nd, 2012(26). With more than $11
trillion, our country has the world’s largest and most liquid government bond
market, but our private debt is bigger. This is a composition of our debts: personal
debt: $15.8 t, mortgage debt: $13.1t, student loan: $ 1t, credit card debt: $900
billion, business debt (Nonfinancial
Sectors):
$12.01 t. Our federal debt is $ 16.04
trillion and our total debt is $58,5 trillion (27). What is remarkable is the fact that we have $ 745.5 trillion in
currency and credit derivative. This number increases since 2008 and represent
more than 10 times the world GDP. It is an indication that we are not immune
from another crash, because the derivative market still deregulated.
Deregulation
of the derivative market is at the origin of the great recession. We were warned
by Brooksley Born but she was fought by a group of men in power including Allen
Greenspan, Robert Rubin and Larry Summers. Deregulation has create lawlessness,
lack of ethics and morals, but capitalism is a system of law. Student loans
could trigger the next crash. It has reach $1 trillion, composed of $864
billion in federal government loans and $150 billion in private student loan
debt. Cumulative defaults on private student loans exceeded $8 billion and in
the past 15 years the average college tuition has increased by nearly 500%. The
default rate for Profit College is 22.7% and the average student borrower now
owes $25,000.
It is not possible to build healthy economy
and growth with unlimited increase of private and public debt. In 1929, Private
Debt in America was 240% of GDP; in 2009 it was 300% of GDP (28). Financial
sector debt is more than $13 trillion. Reduction our debt will not be realized
if we do not produce “made in America”. The politic of tax cut is an illusion. President
Bush cut taxes was a total failure. There has not been in modern history a
model of capitalism driven only by tax cuts. Tax cuts are a gift to the
republican political client and execute the strategy of “starving the beast” key
of conquest of power. Power is easier to conquest when the institutions
of democracy are weak. Starving the beast weaken the government of the republic
and American people, but do not touch military budged. It limited to welfare,
social security, Medicare. Growth and expansion of free market capitalism is
not founded on tax cuts, but it is a very long process of maturation of human
investment. It took the world centuries of coordinated human effort and reaches
this level of maturation of free market capitalism. Shift from agrarian economy
to the painful dynamic of industrial revolution was an extraordinary moment of
sacrifice and suffering of American people. As a follower of Ayn Rand
“Objectivism”, Alan Greenspan admitted in front of congress that his economic
thinking was a mistake. In modern history no human society have been founded on
the illusions of Ayn Rand mediocre novels. When she published Atlas Shrugged in
1957, the USA was already the world number one economy and a model to follow. So
what is the rational to follow unproven theory, when we have created the most
efficient human society for optimal development? Conquest of power is not
guided by any model of economic growth. It is an adventure not directed by
predictability of human activities. Ayn Rand was probably an exiting intellectual
adventure for Greenspan, but the former chairman of the Fed make the mistake to
dismiss proven historical model. Our individualism created the world best
leaders in politic, business, science and technology. Their contributions are proven
historical model of development of free market capitalism. We are the country
of John Rockefeller, Andrew Carnegie, Ray Kroc, Charles Coffin, Bill Allen and Steve jobs. Our individualism is the perfect
expression of individual sovereignty in democracy and capitalism. But we are
also specie of self-destruction. We are the only known intelligent species in
our biosphere. But, if intelligence is a faculty of construction, it is also an
extraordinaire faculty of self-destruction. It was the case of Allan Greenspan
economic policy, now we are challenge by the new case of Paul Ryan in November
2012 conquest of power by republicans. GNR
are transforming the American society to a land of experimentation of the
illusion of self-regulatory human organization. Paul Ryan will follow this
direction and we will return to the disaster of Bush or worst. Expression of Subprime
syndrome is helping Romney-Ryan to build strong momentum in this campaign. Their
political project is extraordinary similar to the Bush policy that cause so much
pain and suffering to the American people; and they plan to make the tragedy
worst if they conquest the White House next month. The law of the land will be
the law of the “New Principality”: less right, less education, less freedom,
less food, less health care, less housing, less transportation…Ect . Our
well-being will be restricted with cuts and dynamic of depreciation of human
capital will reach a very high level. The pedestal of capitalism is human
capital not tax cuts or public spending cuts. When we trigger a process of
depreciation of human capital for political reason, our economic system become
very weak. This depreciation is at the origin of deindustrialization in USA, phenomenal
loss of value in our economy and low competitivity in the global market. Our
imperative is to rebuild the US labor force, and manufacture “made in America”.
But GNR do not support any form of valorization of American labor, they
engineer a complete dismantlement of labor right. Cuts will only increase
severe disequilibriums in American society, restrict freedom and our capacity
the create wealth. This not the right moment to experimented fail economic
policy. Our position in the
world is declining, that’s the verdict from the Economic Freedom of the World
Annual Report. The U.S fell to 18th in 2012, but America was consistently in
the top five.
The temptation of
conquest of power is inherent to all human organization and human nature. This
is why democracy is a permanent fight that will never stop. Democratic power is
structure by a mechanism of alternation of power such as political term limits
and the principle of separation of power to prevent realization of any form of conquest of power.
The objective of these two mechanisms is to make impossible the existence of possible
form of permanent political power in the hands of a single individual or group
of individuals. But in our American democracy, there is permanence of power in
the hands of individuals or group of people in our legislature and the
judiciary. This is source of conquest of power and disequilibrium in our
democracy. Permanence of power lead to bad decisions like the US supreme court
opinion “Citizen United” and the legislative decision to repeal of “Glass Straggle”
which is at the origin of the great recession of 2008. Restoration of Glass
Steagall is a necessity for the engineering of American industrial
renaissance. We should notice that in our national conversation lead by Pdt
Obama and Romney, there is no mention of “Glass Steagall”. A healthy US economy
will be impossible if a legal structuration of management of “wealth of nation”
like Glass Steagall is not in place. The repeal of this law was a donation of
the wealth of American to private financial institutions. This is not how
capitalism was build. Free market capitalism does not put in danger “wealth of the nation” as a hedging instrument
for uncontrollable risk of private financial company. Free market capitalism protects
the “wealth of nation” as a key instrument of growth, development, safety and
equilibrium of human organization. Lack of term limitation has gradually
created a culture of individual permanence and ownership of political power in bipartisanship.
Both political parties identified themselves with the power. Personal
identification to power is the beginning of tyranny. Many of our founding
fathers supported congressional term limits. Thomas Jefferson wrote: "To
prevent every danger which might arise to American freedom by continuing too
long in office the members of the Continental Congress". Bipartisanship is
a political structure of permanence of power for American political elite. But,
in democracy the only permanent power is the power of individual sovereignty
and democratic institutions. This process of political and cultural identification
to power has transform the republican party to an organization of conquest of
power not guided by the principle of democracy, but by the instruments of
conquest of power. Money is the most important instrument of this conquest,
this is why GNR is now an
ideological trading platform where political and economic success of industrial
capitalism is swap with the failure of financial-capitalism. In the last 40
years, the gradual substitution of industrial-capitalism by
financial-capitalism has created a new structure of power founded on transfer
of management of democracy and human affairs to a political elite and privates
institutions by legal means. “Citizen United” and “Glass Steagall” are perfect examples.
“Citizen United” is a commoditization of vote and private enterprises are
source of funding. Glass Steagall increase private companies access to public
funding as a reward of their political contribution. In our democracy we can
now think and structure Political
investment. The Lobbying
Index has now beaten the S&P 500 for 12 years in a row. Return on
investment for corporate lobby is extremely high. ROI for oil, gas and fossil
industry is 5900%. The 111st congress got $ 347 m from this industry and in
return they got $20 billion in subsidies. Multinationals lobby for corporate
tax break got 22,000% return on investment and big pharmaceutical companies got
77,500% (29).
The
Powell memo is at the origin of this strategy of conquest of power by
transformation of USA legal infrastructure. To reach the goal to select
the next President of United States in November 2012 or later, GNR has
reinvented itself to an organization of social engineering for the
establishment of karl Rove “republican permanent majority”. The Powell
memo was the starting point. A republican permanent majority will establish
absolute power driven by excess of political power, legal vacuum and private
interest. When Obama was elected 4 years ago, Senator Mitch McConnell was very
clear. He stated: “The single most important thing we want to achieve is for
President Obama to be a one-term president.” (October 2010). His statement was
an expression of an irreconcilable antagonism. In his new book: "Do Not
Ask What Good We Do: Inside the U.S. House of Representatives" Robert Draper
reported that the republican lawmaker meet the night of Obama’s inauguration
and structured a strong strategy to make him a first term President. According to Robert Draper, the following
person was presents:
Reps. Eric Cantor (Va.), Kevin McCarthy
(Calif.), Paul Ryan (Wis.), Pete Sessions (Texas), Jeb Ensnarling (Texas), Pete
Hoekstra (Mach), Dan Lofgren (Calif.), Republican Sens. Jim DeMint (S.C.), Jon Keel
(Ariz.), Tom Coburn (Okla.), John Ensign (Nev.) Bob Corker (Tenn.), Newt
Gingrich and Frank Lutz. Grover
Norquist republicans were very clear in their political objective.
Bipartisanship is no more guided by the principle of primacy of American people
interests. It is guided by the single objective to defeat Obama in November
2012. A political battle without restriction was declared. Bipartisanship
become dominated by a “Machiavielian” reality that Obama did not know how to
manage. He nominated many republicans: Ben Bernanke has Chairman of the Federal
reserve, Robert Gate was secretary of Defense, Ray LaHood, Sec. of Transportation, John McHugh, Sec. of the Army and
Chuck Hagel, Co-Chair of Intelligence Board. He tries all his best to a collaborative relationship without
success. His political efforts of positive bipartisanship were perceive has
sign of weakness and make him more vulnerable. “Machiavellian” situation
involve a technic of management of power that implies the treatment of
political opposition as pure adversary. Preservation of power is one of the
most important objectives and desire in politic. Our legislator has reach this objective
with lack of term limit. Preservation of power for the president of United
States of America is to be reelected to a second term. The strategy to reach
this goal cannot be achieved without depreciation of the opponent political
position and ideology. In Obama’s case the opponent is the Republican Party. But
he adds political value to this party with his numerous attempt of
collaboration. Accession power for a first term is different from maintenance
in power for a second term. There two totally different realities. The second
is a Machiavellian situation that need self-centered political tactic. Obama is
a pure product of bipartisanship and he treated this party has a political
partner in the interest of the nation. But, power has an intrinsic value: it is
not to be share, but executed. If he treated the Republican Party as adversary
in his first 2 years, his reelection could be less challenging at this point. A
sitting president must hedge his political position all the time to be
reelected, because he is building a record that could undermine this objective.
In this process of balance of power, the President of United States should
always manage to execute his power and have the upper hands in all situations. Obama
did not realize that bipartisanship has reached his final stage of development
with the disaster of Bush administration and his election as the 1st
black President. President Obama is himself a leader of bipartisanship; his
personal political culture is a culture of bipartisanship. This is why he could
not make serious demarcation from this obsolete political structure. The
republican warning was very clear; bipartisanship is in the sphere of political
antagonism. Obama wanted to change Washington, but Washington is the symbol of bipartisanship.
If Washington is dysfunctional, bipartisanship is also dysfunctional. The
resignation of Olympia Snow (Republican-Maine) from the US senate is the
ultimate demonstration of this dysfunctionality. She stated: “There’s no longer political
reward for consensus building.” When the republican party’s leading
presidential contenders declare at a debate that they would oppose any deal
that cut $10 of spending and raise tax by $1, she though the position was
extreme. This position shows extraordinary antagonism and economic ignorance. Economic
policy is simply reduced to cuts on public spending and refusal to raise tax,
Reagan raise taxes. Republican presidents are the biggest spender and creator
of big government.
Obama
will be a transformative President, only if he can politically move beyond
bipartisanship and initiate a new American democracy in the 21st
century. He has the capacity to initiate this fundamental transformation of our
democracy in his second term. It will require at least 2 political initiatives:
“cannibalization” of bipartisanship and opening the national political
competition to other political parties like: American independent party,
American Electe Party, Green Party, Libertarian Party, Peace and Freedom Party.
In 2010, cannibalization of the Republican Party started with creation of
Tparty, but it has fail. The process could start again. Human societies make
extraordinary progress with innovation and new energies. We are in a propitious
period for deep transformation of American democracy. But, We should not lost
sight that the political architecture of bipartisanship has been very
successful in the development of American democracy and industrial capitalism.
In 1787, The Great
Compromise established the House and the Senate so that both the smaller states
in the union and the larger, more populous states could have equal
representation. Since then the USA did not stop to prosper in bipartisanship.
In 1945 Senator Vandenberg create bipartisan foreign policy. Senator Vandenberg
said in 1952, “To me ‘bipartisan foreign policy’ means a mutual effort, under
our indispensable two-Party system, to unite our official voice at the water’s
edge so that America speaks with maximum authority against those who would divide
and conquer us and the free world. It does not involve the remotest surrender
of free debate in determining our position. On the contrary, frank cooperation
and free debate are indispensable to ultimate unity. In a word, it simply seeks
national security ahead of partisan advantage. Every foreign policy must be
totally debated (and I think the record proves it has been) and the “loyal
opposition” is under special obligation to see that this occurs.” (30). His
success was follow by the Civil Rights Act in 1964, Food stamp program in 1977,
Social Security reform in 1983, Welfare Reform in 1996, Obama’s cabinet in
2009. (31) The 1st term of Obama is a period of expression of failure
of bipartisanship by GNR. This failure is an ideological rupture in the Republican
Party. Performance of the Obama administration has been affected by the failure
of this “political partner” more and
more disconnected from the reality of the 21st century. The Republican
Party can be identified as a party of restriction of freedom, money, lack of
diversification, close to innovation and expansion of ignorance. We should
applaud Obama’s important realizations despite the antagonism in the political
environment. Rational of democracy is not founded on antagonism, but diversity
of political opinion and collaborative effort. Antagonism is a negative
approach of political opposition, it undermine rules of democracy and democracy
itself. Antagonism is a destructive strategy. His adoption by GNR has created disequilibrium
in the symmetry of bipartisanship and sterilized the political structure. Since
the election of Obama as President of United State, GNR express only one
priority: win November 2012 presidential election. The consequence of this
political objective is a subordination of interest of democracy to the absolute
desire of the republican leadership to conquer power. The strategy was first
founded on a tentative of delegitimization of the power Obama. In the culture
of conqueror of power, no political power can be legitimate. Perfect democracy
is not the right way to obtain power for conqueror of power. This is why
restriction of rights is key in the political dynamic of Romney’ agenda.
Challenging
the legitimacy of a sitting President is a political and legal act of questioning
the legitimacy the electoral process and universal suffrage that brought him to
power. This is why they have so much attention on his birth certificate and origin. GNR have not succeeded to delegitimized
Obama, but their project has gain momentum with the US Supreme Court decision
“Citizen United”(2010). The decision is a realization of Powell memorandum and
a legal precedent: “Under our
constitutional system, specially with activist-minded Supreme court, the
judiciary may be the most important instrument for social, economic and
political change.”(Powell memo).
“Citizen United” change the nature of American democracy
and
fracture our political system. The decision advanced a political agenda to
destabilized American democracy. World peace will be affected if American
democracy is destabilized. “Citizen United” is preceded by the US Supreme Court
decision to select G.W. Bush as President. With 2 keys victories in the highest
court of the nation, conquest of power by legal means is making progress but
will not defeat democracy. The competitive race between Obama and Romney is an
expression of this reality and could realize the ultimate political risk: vote
of sanction. This vote is not an approval of the political agenda of the
president opponent. It is executed against a sitting President has a
disapproval of his performance. By comparison, Romney-Ryan political agenda is
worst than Bush, but he is well position in this race because the vote of
sanction is building against Obama. Romney’s political agenda is one the most
retrograde plan in modern history. It is centered only on cuts and privatization
of social security, postal office, health care, education, outlaw abortion,
diminished our right…Ect. His plan is an abandonment of responsibility to lead
the American people to prosperity. Republican antagonism toward PDT Obama is
also an abandonment of responsibility. Obama’s plan for the future may not be
perfect but it is clear and coherent. He leads our nation in peace, better
position in the world stage; make progress in health care and safe our economy
from total collapse. But, he can do much better in his second term. Possibility
of vote of sanction gives an enormous advantage to his opponent: he doesn’t
have to demonstrate a clear political plan or coherence. This is what makes the
complexity of this election; in moment of severe human crisis the choice of a
leader can be completely irrational. Romney’s campaign is defined by lack of
specificity, ignorance, tergiversation and understanding of the live of Americans.
His own personality does not fit with average American. But, he is competitive
because his strategy is to capitalize on Obama biggest political risk: vote
of sanction. In this vote, citizen of the republic vote against a sitting
president, not for his opponent. Romney is also competitive, because the Obama campaign
has not put in place a strategy to hedge Obama’s position against the risk of
vote of sanction. More display and demonstration of his administration
accomplishment could help hedge his political position. His administration tax
cuts is one of the many examples: “According to the Tax Policy Center, Federal
taxes are lower than at any time since 1955. Obama has now reduced taxes by
more than any president since Dwight D. Eisenhower”(32). His administration
created 5 million jobs, when Bush was loosing jobs. The only moment when,
Americans saw and appreciate the Obama administration accomplishments is when
President Bill Clinton spoke at the 2011 Democratic convention. Presidential
accomplishment should be permanently display in front of the eyes and ears of
Americans.
The
political will to conquer power is different from the political will of acquisition
of power. This is the fundamental difference between Democrats and GNR in the
presidential contest of November 2012. Obama and the Democratic Party are playing by
the rule of access to power base on consent of American people to delegate
political power. The republican leadership plays by the rule of conquest of
power base on acquisition of power with limitation of American people consent
to delegate power. In democracy, individual sovereignty accedes to power with
universal suffrage. Acquisition of power is made with restriction of universal
suffrage. November 2012 will be a confrontation between the right of American
people to exercise power and a new right to buy the exercise of power. It will
be a defining moment of the future of our democracy. Democracy is not a commodity
and cannot be bought. Restriction of right to vote and women rights will have a
boomerang effect and open new frontiers for expansion of our rights. American
people have been in this situation before and democracy has won. Tentative of
degradation of our democracy in this presidential election is an opportunity to
reinvent our political system in the digital period. New political consciences
are emerging in this new period. Conquest of power by restriction of rights to
vote is creating ruptures in American democracy. But, political rupture should
not an element of advanced democracy; it is a phenomenon of pre-democratic
society and democracy at an early stage of development. Political ruptures are
moment of
transition
from lower state to higher state of democracy. It can be very painful and long.
American revolution and the civil right movement are examples of political
rupture. Both are defining moment of progress of American democracy and
emergence of exceptional leaders like George Washington, Thomas Jefferson, and
M.L. King. Advanced democracies are beyond painful period of formation of the state.
Human societies are now defined by innovation and our capacity to move
possibilities beyond known boundaries of human intelligence. The interaction
between biosphere and digital sphere has create a new world order and
technologies.
Constant innovation trigger dynamic qualitative and quantitative transformations
in advance democracy. Our new challenge is to manage theses transformations.
Human beings now have a digital imprint and a digital live, digital democracy
is being created, the web has destroyed physical boundaries and connect human
consciences and we are living longer. But, the ideology of bipartisanship is
not a reflection of these transformations in the 21st century and
new possibilities of production of “made in America”. Americans are exploring
planet Mars, creating driverless automobiles and very soon television and
computer will be totally integrated. The future is now and the world is defined
by speed. We are leader in world innovation, this is why economic policy centered
on past failure and lack of innovation will not lead American in management of
future. Cuts are incentives; they are not economic driver and will not recreate
American prosperity in the 21st century. We are a country of wealth
creation and innovation. Precedent model of American industrial-capitalism have
never been base on tax cuts. Growth in American capitalism has never been created
by good will of American investors. This is pure illusion, but our country has
been managed by this fiction for more than 30 years. It is one of the reasons
why our position is diminishing in the world competition, in 3 to 5 years China
will be the world number one economy. Citizen who benefit from tax cut, no
matter what is their level of income contribute the development of our society.
But, their contribution is only one of the many elements of the complex
structure of capitalism. It is a dishonesty to make Americans believe that tax
cuts will solve our problem. Bush tax cuts fail and create the great recession.
Capitalism is a process, a dynamic, maturation, solidarity, unity and peace of
coordinated human activities. The result is construction of strong and coherent
social fabric. This is what defines the predictability of human activities in
capitalism. Cuts will destroyed this predictability by weakening our social
fabric. Democracy is sustained by continuity of the state, institutions and democratic
processes. Continuity is an essential factor of stability; it is an
uninterrupted connection in time and space of coordinated human activities. But,
this process will be disrupted by political rupture cause by conquest of power.
Voter suppression, starving the beast, cuts in public spendings, restriction of
women right, moneytization of vote will destabilize coordinated human
activities and continuity of the state. We are in a paradox of American
democracy. Degradation of democracy is creating what Machiavelli call “new
principality”. This degradation of American democracy is a reflection of failure
of our economic system. Financial-capitalism is a result of degradation of
industrial-capitalism and an acquisition of power. Financial capitalism is also
a conquest of power by destabilization of our legal infrastructure with
deregulation and repeal of Glass Steagall. As an industry non-productive of
wealth, Wall Street has successful made an acquisition of “wealth of nation”. Their
risks are hedge with taxpayer’s money. This acquisition of economic and
financial power is also executed by a small group of people. The new principality
of Machiavelli is build with money and inequity.
Bush
vs. Gore decision by the US Supreme Court is a historical precedent of acquisition
of political power. Recourse to legal decision to select the President of USA demonstrates
serious weakness of the democratic process. Substitution of universal suffrage
by legal decision has created a new order in American democracy. Precedent can
be repetitive; this is why it is dangerous. We should not be surprise if the US
supreme court is again challenge by a new case that oppose Pdt Obama to Mitt
Romney. All the evidences are being put in place for this possible legal
confrontation. Litigation has already begun in courts around the country to
stop voter suppression and the risk of a fraudulent presidential election is
very high. In 2000, democracy was challenge in court for presidential election,
in November 2012 the challenge could be bigger. It could be about presidential
election, right to vote and women rights. When right to vote and results of
election are litigated in court of justice, democracy is in danger. Litigation
of democracy is a failure of bipartisanship. It is not in the interest of the
United State to continue in this direction. Our standing in this world of
globalization will loose a lot of value if we are identified has a country not
capable to organize fair and transparent elections or guarantee the right of
his citizen. The danger is greater for world peace if we disrupt our country’s
social stability with restriction of rights. The international community starts
to express concern about American democracy. Since 2002, the US government has invited
international observers to watch our major national elections. Forty-four members of Organization for Security and Co-operation
in Europe (OSCE) will be presents during November 2012 elections. But this
time, Texas State Attorney General Greg Abbott is threatening to arrest them if
they entered a polling place.
The
presidential elections in November 2012 will be the 1st presidential
political contest since “Citizen United” in 2010. Republicans would like to see
less Americans at the polling place and democrats want to see more. This is a
very unique characteristic of republican ideology and paradox of American
democracy. The impact of this ideology of fewer votes is visible in our country
voting record. We have one of the lowest rates of vote in industrialized nation
with 47%, but the boomerang effect of monetization of vote could bring more
American to the voting boots. Right to vote is a human right that cannot be
destroy with money. The American people will fight again and democracy will
win. Teaching of our precedent model of instauration of popular democracy will
make it easier. Conquest of power is always executed with instruments and
strategy incompatible with democracy: money, polarization of judiciary system,
restriction of early voting and polling hours…Ect. Our democracy is now defined
by hybrid rule: “one person-one vote” and “more money-more votes”. The goal of this
new rule is to select Mitt Romney as the next President of USA. Capitalism can perform well only when
democracy is popular. This is not the case of our democracy in the second
decade of the 21st century. Capitalism strengthens democracy with
harmonization and satisfaction of human interests with different nature. Human
society is defined by presence of the interests of a mother who want to educate
her child. It is different from the interest of the researcher working on new
discovery. Industrial-capitalism in America was very successful in satisfaction
and harmonization of different interests. Democracy and capitalism are strong,
only if our human organization can satisfied the needs of maximum citizen. This
objective was an American reality. But we lost this success with a series of very
bad decisions like transformation of industrial-capitalism to
financial-capitalism. We are now in a period of cuts, punishment of American
people or disatisfaction of needs. The mother who want educate her child may
not reach her goal because of cuts in our education system. We are now building
more prisons than schools. Since
1980, we saw a decrease of 13% in higher education spending in California, but an
increase of 436% the prison system (33). Education fund is dropping around the
country, Arizona, California, Hawaii and South Carolina cuts more than 20%
since pre-recession. Thirty
states are funding schools at levels lower than they were in 2008 and 17 states
have cut funding by more than 10 percent
(34). A less educated population cannot build
performing capitalist system and our position as world leader will diminish.
This is one of the many disequilibriums
create the economic policy of cut. In recent study, Teresa Ghilarducci, a
professor of economics at The New School indicate that 75% of Americans nearing
retirement age will have between $16,034 and $30,000 to live and a daily food
budget less than $ 5 a day. This data shows the failure of our pension system
and financial capitalism. Teresa Ghilarducci’s study is a demonstration of an
important disequilibrium in our society. Our incapacity to provide safety to
retirees is an indication of moral and economic depreciation. Capitalism is humanism,
not a system of creation of existential risk. Financial-capitalism is
destroying one of the finest products of capitalism: strong and reliable
pension system.
When
human organization demonstrates total incapacity to manage with safety and success
human live, its economic system has failed. Retirement is a very important
moment of the live of every American. It is a crucial moment of conclusion that
deserves total safety and protection. In our society, this moment should not be
define by poverty and insecurity. The failure of our current retirement system
is a moral failure; we have the moral obligation to protect the live of those
who have worked for the success of our Union. Capitalism is a system of
protection of wealth of nation, not a system of speculation of wealth.
Industrial-capitalism managed our retirement system with success because of protection
of “wealth of Nation” and high moral standard. Financial-capitalism does not
protect this wealth, consequently endangered human society. We have the moral
obligation to protect “wealth of nation” the same way we must protect the
safety of our nation and its citizens. Wealth production is an important
function of capitalism, but protection of this wealth is essential to its
growth. Our moral obligation is to protect this wealth against speculation or
we will endanger human existence. Capitalism is not limited to a simple process
of generation of short-term profit or privatization. The convergence of these 2
elements has created financial-capitalism and deployment of private interests
excess. Excess of human being is destructive
in politic and entrepreneurship. Sub-prime loan that trigger the great
recession is an expression of this excess and deregulation is a road map for
its execution. Excess of private interest is incompatible with capitalism and
excess of political interest is incompatible with democracy. Financial-capitalism
is the economic system of private interest excess defines by debt, inequity and
speculation. Financial institutions are making record profit with use of flash
trading, hedging their risk with taxpayer money but American are in deep crisis.
This imbalance is not a characteristic of capitalism but define sub-capitalism.
Privatization, securitization, deregulation are the cornerstones of this new
form of capitalism in America. This is not how America became the world number
one economy. Privatization, securitization and deregulation are all
legislatives decisions that exclude American people in the process of wealth
creation. It is not possible to develop any form of human organization with exclusion
of population. Capitalism is a process of inclusion of all assets of human
society. This is why capitalism is humanism because human being is the center
of its development. Process of wealth creation is a phenomenal inclusion of
creativity, entrepreneurship, labor, capital, social stability, democracy,
culture, history, intelligence…Ect This is how capitalism was created.
Short-term profit and privatization do not create wealth in financial-capitalism,
it extracts wealth from the American people. The banks bailout was an
extraction of wealth from the American people. Strong moral values and ethic
are the backbone of inclusion in capitalism.
At
the end of the 20th century, the combination of Privatization,
securitization, deregulation and 'Starving The Beast' has put American economy
on the descent.
Allen
Greenspan articulated the theory of 'Starving The Beast' in 1978:"Let us
remember that the basic purpose of any tax cut program in today's environment
is to reduce the momentum of expenditure growth by restraining the amount of
revenue available and trust that there is a political limit to deficit
spending." (35). Citing
Greenspan's testimony, conservative columnist George Will wrote about Starving
The Beast on this term (July 27, 1978): "The focus of the fight to
restrain government has shifted from limiting government spending to limiting government
receipts". The goal of this economic policy is to depressed government
revenues, put fiscal pressure on this institution and execute spending cuts.
There is no ambiguity in GNR attempt to depreciate the nature of our
government. But, when government becomes insignificant it creates disfunctionality
in democracy and weakens capitalism. Republicans obsession with government is driven
by politisation of this institution. Transformation of government to a
political adversary is an ideological marketing to depreciation the 3 powers of
our democracy and open more doors for successful conquest of power. After more
than 40 years of politisation of government, “anti-government” is a key
ideological position in American political culture. It fuel weakness in
capitalism and democracy. Modern democracy all over the world has been
challenge by the bureaucracy of government. We should precise that republican
obsession with this institution is not limited to the bureaucracy of
government, but they want to make it disappear. Government bureaucracy is
inherent to management of human society. Government bureaucracy and
overspending is part of the daily challenges of capitalism. It is an element of
imperfection of the system and need constant improvement, especially in the
dynamic of transformation and speed of the digital world. Emergence of this new
world gives us an enormous possibility to create Efficient Government. Much sophisticated
tools for rational management of government and other organs of human society
exist. But, the economic policy crafted by “Starving The Beast” is not aim at
the creation of Efficient Government. “Starving The Beast” is a political
agenda to deprive American people the means to manage their own destiny. “Starving
The Beast” cut the tree branch on which we are sitting on. This economic policy
is an illusion and it has fail. But it is the direction that Romney would like
to take America and we are experiencing a manifestation of sub-prime syndrome. Precedents
of Romney’s agenda is the fail economic policy of Allen Greenspan inspire by the
illusion of the mediocre novel of Ayn Rand, “Starving the Beast” and Bush
policy.
Grover
Norquist Republicans strategy to conquest of power in November 2012 is a corollary
of political strategy in democratic election. It is a succession of new series
of legislative and judicial interferences to neutralize the universal suffrage.
The voter ID law is a corollary of universal suffrage with the goal to increase
low rate of vote in USA. In the develop world only 3 countries have less than
50% of voter turn out. With only 47% (It is not Romney’s 47%) of participation
the USA is the 2nd lowest country, South korea being last (36). Lower rate of
vote is one of the most important objectives of Karl Rove project of
instauration of “permanent republican majority” in USA. It devalues
democracy and triggered a process of disintegration of our political system
and dynamic of conquest of power. In 1980, the co-founder of the Heritage
foundation, Paul M. Weyrich stated:
“I
don't want everybody to vote. Elections are not won by a majority of the
people. They never have been from the beginning of our country and they are not
now. As a matter of fact, our leverage in the elections quite candidly goes up
as the voting populace goes down." "We are different from previous generations
of conservatives. We are no longer working to preserve the status quo. We are
radicals, working to overturn the present power structure of this
country." Paul M. Weyrich statements are perfect definition of anti-democracy
in the framework of execution of Powell
memo. Reduction of the rate
of vote is a neutralization of principle of delegation of
power which is the
foundation of democracy. By neutralizing the universal suffrage,
conqueror of power initiate
a process of restructuring the political power and
established a new order. Therefore
management of democracy ceases to be an affair
of the people to become an
affair dominated by private institutions and small group
of private individuals. The
US supreme court decision “Citizen United” is a legal
legitimation of this anti-democratic
transfer. November 2012 will be a test for this
dynamic of neutralization of
the universal suffrage. The voter ID engineered by GNR
will prevent a 80 years old
women to exercise a civic duty she have been doing for
more than 50 years. In
Philadelphia Mayor Michael Nutter indicated that up to
43 % of voters may lack a valid form of
state-issued identification, therefore will not
be able to vote. In this
state the case of a 93-year-old women named Viviette
Applewhite is a perfect
example. She have been doing her civic duty since 1960, but
under Pennsylvania’s new
voter ID law, Ms. Apple white will not be able to
vote. We are in common law, previous
legal acts should be enough to prove the
legitimacy of future acts. GNR
has initiated this legislation by arguing that there is a
lot of voter fraud in our
democracy. But, the argument is not supported by any
serious evidence. Historically
our democracy was very transparent. Electronic
voting machine is the
serious danger to the transparency of our democracy but
bipartisanship has failed to
address the problem. Results can be manipulated and
they are manufactured by
private entity. Expression of suffrage universal should not
be manage by private
institution looking for profit.
Voter
ID law will have a boomerang effect, and trigger an opposite effect if the Democratic
party show strong organizational skill to energized the American people, register
the maximum voter and win in November 2012. In a long term, this legislation
could be one of the key elements for renewal of American electoral system in
the 21st century. Bush-Gore was a historical moment to put an end to
the anachronism of the Electoral College, but bipartisanship culture of
immobilism did not show strong capacity to initiate this major transformation
of our democracy. Sixty-two (62%) percent of American are against the Electoral
College. Winning a presidential election in United State of America with 270
electoral college votes or loosing with the majority of popular votes is not
viable in the 21st century. This situation happened 3 times in our
history and it is a possibility in November 2012. The division of the country could
give us a 269-269 result. In
this scenario, the 12th Amendment to the Constitution says the House of
Representatives chooses a president from among the top three vote-getters. Many states start to reform
the Electoral College. In 2007,
Maryland became the first state to enact state legislation to guarantee the
election of the President by popular votes. We
lost the 1st decade of the 21st century and we are in the
same direction in this second decade. The 1st decade was a failure
economic policy of a republican president and creation of two wars that cost
American taxpayer more than $3 trillion. The second decade is an ideological failure
of the Republican Party caused by an antagonism against Obama and abandonment
of management of American
people affairs. The progressive destruction of the middle class in America is
our biggest lost in the last 4 decades. The median household income fall from
$72,956 in 2001 to $ 69,487 in 2010 (37). Success of industrial-capitalism was defined
by an expansion of the middle and increase of buying power. But,
apparition of financial-capitalism and excessive private debt has created lost
of buying power, develop extreme inequality: 50% of Americans only own 2,5% of
the country wealth, 0.5 % of investment assets and 73% of the debt is own by
the bottom 90% of Americans (38). CEO
pay has increase 300% since 1990 and earns more than 1800 times what the
average worker makes. In 2010, their compensation grew 28% and went down to 15%
in 2011.
(39).
The Economic Policy Institute
indicate: “From
1978 to 2011, CEO compensation increased more than 725 %, a rise substantially
greater than stock market growth and the painfully slow 5.7 percent growth in
worker compensation over the same period”. Workers in private industry,
meanwhile, saw their compensation grow just 2.1%. This is a consequence shareholder
ideology in financial-capitalism. It is a limitation of free market capitalism
to satisfaction of immediate and short-term interests and stock market
manipulation. Financialization is a process of creation of disproportionate
growth of deregulated financial sector centered on short-term financial return.
The disproportionate growth generates synthetic wealth and uncontrollable risk.
Derivative market is more than $ 700 trillion. Capitalism is not a faculty to
create fictitious wealth, but a capacity of real wealth production. This
contradiction is very disruptive; it is an opposition between productivity and
short-term financial return. When productivity is dominated by short term
financial return the system underperform. This is the reality of American
economy. Financial-capitalism has developed a hypertrophy of financial sector in
our economy, subordination of productive industries and ruptures in the
functioning of our political system. The solution to this hypertrophy of
financial sector is renaissance of industrial capitalism. Wealth is not created
with daily swing in the stock market and performance of flash trading. Maximization
of shareholders value is not maximization of “wealth of nation”. Shareholder ideology
develops a process of synthetic wealth creation and marginalized the stock
market from the dynamic of real wealth creation. The market is a key element of
capitalism and his role is vital to development of investment. Capitalism is a
complex process of value adds in human interaction. But, the market-computerized
system should not be an anti-thesis of this humanism. The future of humanity
will be defined by our intelligence to created a symbiosis between man and
computer system. But, we cannot submit “wealth of nation” to speculation of the
market. This is why financial-capitalism endanger human organization. is
In
light of poor performance of republican presidents, history demonstrates that
our economy is better managed by Democrat Presidents. PDT Bill Clinton
highlighted this fact very well in his speech at the 2011 Democratic
convention. Bloomberg government (BGOV) barometer shows that since Democrat
John F. Kennedy took office in January 1961, non-government payrolls in the
U.S. swelled by almost 42 million jobs under Democrats, compared with 24 million
for Republican presidents (40). That’s an average of 150,000 new paychecks
a month under Democrat Presidents and 71,000 per month under Republican
Presidents.
Democrats
held the presidency for 24 years compared with 28 years for Republican. Investing $1,000 in a
hypothetical fund that tracks the Standard & Poor’s 500 index over the past
50 years would have returned $10,920 when Democrats held the White House. The
return when Republicans are in power should be $2,087. Annualized returns were
11 % for the Democrats, 2.7 % for the Republicans. Real GDP grew faster under
Democratic administrations with 4.1 % and 2.7 % for Republicans. Under
Democrats, the real median income over the past 50 years grew at 2.2 percent;
it is 0.6 % under Republicans (41). Since January 1961, federal, state and local government
employment grew by 7.1 million under Republican presidents and 6.3 million when
Democrats were in the White House. (42) In this political rivalry, Democrats
have not been effective to demonstrate to the American people these very
important differences of economic performance with the Grover Norquist Republican.
This is a big weakness for Democrats, they need better ideological marketing
machine. When Obama came to power after Bush, our economy was loosing 800 000
jobs per month, now we are creating new jobs every month. The automobile
industry, symbol of success of American industrial-capitalism have been save
from bankruptcy, we have a safer country with the death of Ben Laden and we are
ending the war. These are important achievements of Obama’s administration even
if unemployment rate is high in normal standard. If Obama is reelected with
7.9%, he must turn to FDR for inspiration. During this 1st term of
Obama, abandonment of responsibilities to manage the affairs of American people
by GNR was a consequence of bipartisanship failure to created healthy political
environment for economic growth. Bipartisanship is now a new political risk
since we lost our triple A statute. Political risk is new in advance democracy
like the United State Of America. It is an indication of weakness of
bipartisanship and a necessity to reinvented new political system in the 21st
century. Political dualism is the center for development of irreconcilable
antagonism. Dualism generate a process of identification of the other party as
the most important obstacle to power and consequently develop a desire for total
elimination of this party as a mean of conquest of power. In the political
culture of GNR, the Democratic Party is an obstacle to conquest of power and
the right to vote for all American citizens is the second obstacle.
GNR
would like to win the White House in November 2012 by taking the position of
conqueror of power and capitalizing on vote of sanction. Obama has contributed to the creation of this
political risk and created the conditions of tough political competition for
his reelection. It was clearly visible in the beginning of his 1st
term that his economic performance would not meet the expectation of the
American people. The appointment of Tim Geithner as Treasury Secretary and
Lawrence Summers Director of National
Economic Council (NEC) was a good indication. Both are architect of
deregulation and transformation our nation to a nation of debt. These 2
appointments demonstrate Obama’s political will not to use the previous
successful model of FDR. It was a bad choice of economic policy, this why
unemployment still high.
The
race between Romney and Obama is very competitive. Bipartisanship has divided our
country in multiple dualism: republicans and democrats; big government and
small government; private sector and public sector. We became more republicans
and democrats than Americans. This culture of division of Americans into two
camps stifle innovative political thinking and creation of new innovative
political organization. If we want to keep our position as world leader and improve
the well being of Americans, our nation political structure must be innovative
and open channels of new political energies. A bipartisanship solutions are not
anymore enough to solve our nation problems and selecting Romney as PDT of
United State of America will make it worst. There is no difference between the
destructive policy of Bush and Romney’s political agenda. The republican
candidate political project will be more destructive than Bush policy. The
project of privatization in a future Romney administration will be extended to
medicare, social security, US postal services…Ect. It will be an installation
of conqueror of power, continuation of dismantlement American social fabric by
commoditization of our live. The means for elementary operations of a coherent
society will disappear with implementation of “Starving The Beast”. Capitalism
cannot be productive in society with out social cohesion and solidarity with cuts
and restriction of women right.
It
is the important to focus our attention to the effective presence of the
republican candidate in this race, despite many political blunders and anti-democratic
positions. One might ask……… how American citizens can identify with a policy
that has caused so much pain and suffering? What is the rational in the support
of a policy that destroy the American dream? The response is: development of a
vote of sanction against Obama. In moment of crisis population can vote against
a sitting President because they are looking for better solution. Political
blunders have been wide spread in the Republican Party, but did not stifle
Romney’s momentum. Romney campaign is full of Political blunders: “I like to
fire people”, “Binder full of women” and 47% comment are few examples. US
senate candidate Rep. Todd Akin scandalous comment on “legitimate rape” is
another example. But, his position represents the real political thinking of
the GOP as conqueror of power. His statement is in the logic of “Sanctity of
Human Life Act” a bill he sponsors with republican vice-presidential candidate Paul
Ryan. Conquest of power transforms individual sovereignty from citizen of the
republic to subjects submitted to the domination of the conqueror. Control of
women sexuality with “Sanctity of Human Life Act” is an element of this domination.
Republicans tentative to deteriorate women rights and right to vote shift our
national priorities of economic growth to a project of criminalization of woman
sexuality and degradation of human rights. In 2007, Rick Berg North Dakota
republican senate candidate voted to make abortion in case of rape and incest
carry life sentence. Rick Berg was speaker at the Republican National
convention on August 28th, 2012 and ironically had the courage to
criticize Todd Akin comment a few weeks earlier. It should not be a surprise in
the future if the ban of abortion will be a reason to increase women healthcare
cost and pregnancy view as medical risk. We are in the dynamic of development on
GNR financial-capitalism characterized
by “commoditization” of our live. These positions are expression of a
political retardation. Like any conqueror of power, the objective of the
republican presidential candidate is not centered on the well-being of American
or perfection of our democracy. Romney’s conquest of power is to cease a
historical moment to grab political power, dominate American people and satisfied
short-term private interests. This historical moment is define by the
possibility of vote of sanction. Denial of global warming, science and
evolution is another expression of political retardation of the elite of GNR.
The subject is conspicuous by its absence in the electoral campaign. But, it is
one the major challenges of human conscience in the 21st century. As
human beings, we are the most self-destructive species in our biosphere, but we
have morale obligation of preservation of nature. Global warming is developing
a new risk in USA and around the world: existential risk. The extinction of a
variety of animal species has started, and human being will be next if do not
find a solution to this universal problem. Development of global warming is a
failure of intelligent organization and capitalism. The phenomenon is an
opportunity for a redefinition of capitalism in the 21st century.
Free market is a human adventure to build better society. By nature, it
develops with emergence of imperfections and unpredictable consequences. Since
the shift from agrarian economy to the development of dynamic of industrial
revolution, capitalism has demonstrated an extraordinary ability to overcome
imperfections. Throughout history we experience war, famine, political
instability, natural disaster, but capitalism has always improves and became a
better economic system. This strength of capitalism is due to the fact that the
system is a human process. Human being have an extraordinary capacity
adaptation and innovation. Global warming and existential risk are not a
handicap to a new level of maturation of capitalism, but a warming to human
consciousness. The moment is crucial; we should be more American, less democrat
and less republican and turn global warming to an opportunity. Our focus should
not be on satisfaction of short-term private interests, they do not always
coincide with long-term interests of capitalism and human development. Global
warning is cause of private interests excess and failure of human conscience. Destruction
of biosphere is not an objective of capitalism, but a consequence of the system.
This economic system is founded on long-term process of construction of human society.
In this crucial moment, elimination of existential risk should be our priority.
Our leader should have the courage to address this very serious human challenge
and help build more efficient free market capitalism. Danger of existential
risk became greater when GNR elite denied the existence of global
warning and science. The position is expression of ignorance not at the image
of USA. Hurricane Sandy is a manifestation of global warming and existential
risk. But, the damage of this natural disaster will not be solve by republicans
political clientele in the private sector like Kosh brother or Sheldon Adelson.
It will be solve by us as organize human society. We have the responsibility to
protect our society in all circumstances. Only institutions that govern us can
assume this responsibility. The nature of this responsibility makes government
a very unique institution to respect. This dimension of management of human
affairs is beyond profit and private sector creation, it about human existence.
Challenge to human existence can only be solve with human solidarity not
partisan politic.
We are a country that sent a man to the moon
and we are define by knowledge and science. We cannot manage Free market
capitalism with ignorance. But, republicans conqueror of power is not define by
knowledge. They do not have any interest in power of knowledge; only
instruments of acquisition of political power can attract their attention. The
domination of the Republican Party by the wealth of small group of people deteriorated
the democratic nature of this political organization. It will not be possible
for the USA to face the complexity of challenges in the 21st century
with an ignorant political elite. Ignorance is not an American value; it is the
ideology of GNR elite. America is an economic and knowledge super-power. Our
extraordinary capacity to create, manage and develop knowledge is the backbone
of our success. Benjamin Franklin created the Lightning Rod in 1752 and the USA issues its first patent to
William Pollard of Philadelphia in 1790. In
1844 the creation of Telegraph by Samuel F.B. Morse
was the beginning of a new era in communication. Christopher Latham Sholes
invented the Typewriter in 1873. In1876 we entered a more sophisticated period
of communication,
Alexander
Graham Bell patents his telephone and 3 years later Thomas Edition invented the
electric light bulb in 1879. The J.P. Holland torpedo boat company created the
submarine in 1898 and Henry
Ford created the Ford Model T car in 1908. Philo Farnsworth invented television in 1927. Dr. Albert
Sabin develops a polio vaccine in 1957 and in 1969 an American Neil Armstrong
becomes the first human to set foot on the moon. President Kennedy’s prediction
was correct. He predicted that the United States would put a human on the moon
before 1970. This few historical events demonstrate the extraordinary
contribution of USA to world knowledge and the development of science and
technology. Again, we transform the world in 1962 with the creation of the Internet.
This creation has been follow by the extraordinary success of the digital
sphere and emergence of new technology. All these success are also success of the government of the republic. Politization
of government is an extraordinary ignorance and divide the American people.
Severe
crisis in human organization define new priorities and possibilities, this is
why the sub-prime crisis is an opportunity to create better capitalism. We are
in the 21st century, period of extraordinary development of knowledge
and expansion of capitalism around the world. The revolution in the Middle East
is a defining moment of expansion of capitalism and knowledge. In this region
of the world, 400 million people are in the process to enter real free market
capitalism. The great recession is a moment when the center of free market
capitalism is shifting from the West to Africa, Asia, Eastern Europe, Latin
America and Middle East. John Naisbitt first described this phenomenon in his
book Megatrends in 1982. The boundaries of free market capitalism are expanding
and emerging thinking will shape our future.
The USA capacities of wealth creation are
better today than 50 years ago and we are on top of creation of new technology
and innovation. The digital sphere is a multi-trillion dollars market and
sphere of new possibilities for humanity. We are the country of APPLE the world
most valuable company estimated at more than $ 600 b. We are also the country
of Microsoft, HP, IBM, Facebook, Twitter, Dell, Google, Yahoo, Cisco, American
Express, Visa, …Ect.
Democracy is
a permanent fight. On
November 6th, if vote of sanction is realized, democracy in United
State of America will be transform to Michiavelli’s “New principality” and
political power will be conquered by the Prince. Our country’s economic policy
will be guided by sub-prime syndrome. But Conquest
of power has an ephemeral nature and democracy can’t be bought. Obama’s
campaign incapacity to edge political risk of vote of sanction and development
of sub-prime syndrome are one the most important political lesson of this
political competition. Transformative President needs two terms. A victory of President
Obama, will be a victory for democracy. PDT Obama’s second term should be a
moment to realize American industrial renaissance and a moment to be more Americans,
less democrats and less republicans.
Aboubacar
Sissoko
Author
NOTES
1-mises.org- The Sad Legacy of Ronald Reagan by Sheldon L. Richman Volume VI, No.
10, October 1988
2-www.metropolismag.com
3-www.GAO.gov/
Federal Reserve System, Opportunities Exist to Strengthen Policies andProcesses
for Managing Emergency Assistance
4- addictinginfo.org
5- Gallup, September 14, 2012
6-
marketwatch.com/2012-05-22
7-www.rooseveltinstitute.org-
The crisis of wealth destruction, By Henry C.K. Liu - April 5, 2010
8-
BETTER MARKETS:THE
COST OF THE CRISIS - Sep 12, 2012
9- The
American Prospect, “The Plight of American Manufacturing” - RICHARD MCCORMACK
DECEMBER 21, 2009
10-http://www.tradereform.org
11-http://www.tradereform.org
12- Mother Jones - It's the
Inequality, Stupid-By Dave Gilson and Carolyn Perot | March/April 2011
13-
David Moss, “An Ounce of Prevention: Financial Regulation, Moral Hazard, and
the End of ‘Too Big to Fail,’” Harvard Magazine, September-October 2009
15-
Grover Norquist Republicans
16-www.emachiavelli.com
- Machiavelli's The Prince (1513) Chapter VII: Concerning New Principalities
which are Acquired either by the Arms of Others or by Good Fortune.
17-
McKinsey Global Institute, Debt and deleveraging: Uneven progress on the path
to growth January 2012.
18-www.creditwritedowns.com
20- Congressional Research Service
21-
www.levin.senate.gov/newsroom- "Offshore Profit Shifting and the U.S. Tax
Code."
22-
blogs.cfainstitute.org
23- How to predict the next
financial crisis? Steve Clemons and Richard Vague-2012
24-
standardandpoors.com- August 5, 2011
25-
Wells Fargo: The U.S. Debt Downgrade: Where Do We Stand One Year Later?- Marc
A. Doss, CFA®, CFP®, Regional Chief Investment Officer, Peter Wilson, Senior
Fixed Income Portfolio Analyst
Peter Donisanu, Global Research Analyst- August
2, 2012
28- seekingalpha.com, MICHAEL J CLARK,
30-
Partnership for a Secure America – PSA
31-
bipartisanpolicy.org.
32-
politicususa.com - Barack Obama Is Now The Biggest Tax Cutter In American
History-Jason Easley-April 17th, 2011
35-
Forbes,
Tax Cuts And 'Starving The Beast'-Bruce Bartlett, 05.07.10
36-
OECD, 2011 REPORT
37-
Pew research center
38-
businessinsider.com
39-
thinkprogress.org
40-
US Labor Department
41-
Politico-Facts
show Democrats are job creators - JENNIFER GRANHOLM, May 12
42-
Bloomberg-Private
Jobs Increase More With Democrats in White House, By Bob Drummond - May 7,
2012).
No comments:
Post a Comment