Tag: Washington

Who Owns the World?

Noam Chomsky, Who Owns the World?

Once again, I am indebted to Tom Engelhardt of TomDispatch fame for granting me permission to republish yet another fascinating essay.

In fact, this post was scheduled for Learning from Dogs very shortly after Tom’s essay appeared on TomDispatch some 5 months ago.  For reasons that escape me now, I parked it and then forgot about it.  But what is striking is that, as Tom points out in his introduction, the essay from Noam Chomsky was originally published on Tom Dispatch in April 2011, the thick end of 21 months ago.  It reads as if it was off the press today.  What a truly strange world we all live in.

I include a link to Noam Chomsky’s website after the essay, so now to Tom’s introduction:

oooOOOooo

The Persian Gulf

In Noam Chomsky’s “Who Owns the World?” — the most popular TomDispatch post of all time (which means the last 10 years) — he wrote of one key imperial principle: “The U.S. cannot tolerate ‘any exercise of sovereignty’ that interferes with its global designs.”  Hence, the under-reported but staggering U.S. build-up in the Persian Gulf.

Of late, most “build-up” publicity has gone to the Obama administration’s “pivot” to Asia (to “contain” China), including an announcement that 60% of U.S. naval power will sooner or later be deployed to Asian waters.  But much of this remains a promise for the future.  The real “pivot” focus of the moment, if it can even be called that after all these years, remains Iran.

That country is largely surrounded by American military bases continually being built up, including a new missile defense radar station at a secret site in Qatar, part of a developing U.S. regional anti-missile system.  In addition, there is an ongoing build-up of U.S. commando forces; of the military power of U.S. regional allies, thanks to new weapons systems of all sorts regularly being put on offer by Washington; of U.S. naval forces in the Persian Gulf, already enormous and still growing, including not one but two aircraft carrier battle groups, minesweepers, a new “floating base” for possible special operations forces, and tiny drone submersibles being “rushed” to the region. And don’t forget a similarly large-scale build-up of U.S. air power, including the deployment of the most advanced U.S. fighter plane, the F-22, to a base in the United Arab Emirates.

Add this to a series of warlike acts, including ever-tightening oil sanctions against Iran, the release of cyber worms meant to infect Iranian computer systems connected to its nuclear program, and an evident Israeli campaign to assassinate Iranian nuclear scientists, and you have quite a “pivot” in what is, let’s not forget, the oil heartlands of the planet.  Much of this is being covered in a scattered, almost absentminded way in the mainstream media.  Yet anyone familiar with how World War I began knows that massive military build-ups or mobilizations — and a rickety Iranian regime is doing its best to respond regionally with its own mini-military build-up — can lead to war, whether either side actually intends it or not.  A U.S. ship recently firing on an Indian boat — and killing one fisherman — near Iran is a reminder of where such inherently trigger-happy situations can lead.

Add to all this the fact that the planet’s former self-proclaimed “sole superpower” is visibly decaying and increasingly desperate to maintain its pretensions to global dominance, and you have a formula for future disaster. Isn’t it sad in its own way that Chomsky’s piece, first posted at this site in April 2011 (like the 2004 Chalmers Johnson piece reposted last Sunday), is in no way outmoded?  It’s not faintly ready for the dustbin of history, and in fact, it remains ahead of its moment.  In this sense, the United States is a Chomskyan nation, eerily following the path he’s laid out for it and so, undoubtedly, heading for something ugly indeed. Tom

Is the World Too Big to Fail?
The Contours of Global Order

By Noam Chomsky

The democracy uprising in the Arab world has been a spectacular display of courage, dedication, and commitment by popular forces — coinciding, fortuitously, with a remarkable uprising of tens of thousands in support of working people and democracy in Madison, Wisconsin, and other U.S. cities. If the trajectories of revolt in Cairo and Madison intersected, however, they were headed in opposite directions: in Cairo toward gaining elementary rights denied by the dictatorship, in Madison towards defending rights that had been won in long and hard struggles and are now under severe attack.

Each is a microcosm of tendencies in global society, following varied courses. There are sure to be far-reaching consequences of what is taking place both in the decaying industrial heartland of the richest and most powerful country in human history, and in what President Dwight Eisenhower called “the most strategically important area in the world” — “a stupendous source of strategic power” and “probably the richest economic prize in the world in the field of foreign investment,” in the words of the State Department in the 1940s, a prize that the U.S. intended to keep for itself and its allies in the unfolding New World Order of that day.

Despite all the changes since, there is every reason to suppose that today’s policy-makers basically adhere to the judgment of President Franklin Delano Roosevelt’s influential advisor A.A. Berle that control of the incomparable energy reserves of the Middle East would yield “substantial control of the world.” And correspondingly, that loss of control would threaten the project of global dominance that was clearly articulated during World War II, and that has been sustained in the face of major changes in world order since that day.

From the outset of the war in 1939, Washington anticipated that it would end with the U.S. in a position of overwhelming power. High-level State Department officials and foreign policy specialists met through the wartime years to lay out plans for the postwar world. They delineated a “Grand Area” that the U.S. was to dominate, including the Western hemisphere, the Far East, and the former British empire, with its Middle East energy resources. As Russia began to grind down Nazi armies after Stalingrad, Grand Area goals extended to as much of Eurasia as possible, at least its economic core in Western Europe. Within the Grand Area, the U.S. would maintain “unquestioned power,” with “military and economic supremacy,” while ensuring the “limitation of any exercise of sovereignty” by states that might interfere with its global designs. The careful wartime plans were soon implemented.

It was always recognized that Europe might choose to follow an independent course. NATO was partially intended to counter this threat. As soon as the official pretext for NATO dissolved in 1989, NATO was expanded to the East in violation of verbal pledges to Soviet leader Mikhail Gorbachev. It has since become a U.S.-run intervention force, with far-ranging scope, spelled out by NATO Secretary-General Jaap de Hoop Scheffer, who informed a NATO conference that “NATO troops have to guard pipelines that transport oil and gas that is directed for the West,” and more generally to protect sea routes used by tankers and other “crucial infrastructure” of the energy system.

Grand Area doctrines clearly license military intervention at will. That conclusion was articulated clearly by the Clinton administration, which declared that the U.S. has the right to use military force to ensure “uninhibited access to key markets, energy supplies, and strategic resources,” and must maintain huge military forces “forward deployed” in Europe and Asia “in order to shape people’s opinions about us” and “to shape events that will affect our livelihood and our security.”

The same principles governed the invasion of Iraq. As the U.S. failure to impose its will in Iraq was becoming unmistakable, the actual goals of the invasion could no longer be concealed behind pretty rhetoric. In November 2007, the White House issued a Declaration of Principles demanding that U.S. forces must remain indefinitely in Iraq and committing Iraq to privilege American investors. Two months later, President Bush informed Congress that he would reject legislation that might limit the permanent stationing of U.S. Armed Forces in Iraq or “United States control of the oil resources of Iraq” — demands that the U.S. had to abandon shortly after in the face of Iraqi resistance.

In Tunisia and Egypt, the recent popular uprisings have won impressive victories, but as the Carnegie Endowment reported, while names have changed, the regimes remain: “A change in ruling elites and system of governance is still a distant goal.” The report discusses internal barriers to democracy, but ignores the external ones, which as always are significant.

The U.S. and its Western allies are sure to do whatever they can to prevent authentic democracy in the Arab world. To understand why, it is only necessary to look at the studies of Arab opinion conducted by U.S. polling agencies. Though barely reported, they are certainly known to planners. They reveal that by overwhelming majorities, Arabs regard the U.S. and Israel as the major threats they face: the U.S. is so regarded by 90% of Egyptians, in the region generally by over 75%. Some Arabs regard Iran as a threat: 10%. Opposition to U.S. policy is so strong that a majority believes that security would be improved if Iran had nuclear weapons — in Egypt, 80%. Other figures are similar. If public opinion were to influence policy, the U.S. not only would not control the region, but would be expelled from it, along with its allies, undermining fundamental principles of global dominance.

The Invisible Hand of Power

Support for democracy is the province of ideologists and propagandists. In the real world, elite dislike of democracy is the norm. The evidence is overwhelming that democracy is supported insofar as it contributes to social and economic objectives, a conclusion reluctantly conceded by the more serious scholarship.

Elite contempt for democracy was revealed dramatically in the reaction to the WikiLeaks exposures. Those that received most attention, with euphoric commentary, were cables reporting that Arabs support the U.S. stand on Iran. The reference was to the ruling dictators. The attitudes of the public were unmentioned. The guiding principle was articulated clearly by Carnegie Endowment Middle East specialist Marwan Muasher, formerly a high official of the Jordanian government: “There is nothing wrong, everything is under control.” In short, if the dictators support us, what else could matter?

The Muasher doctrine is rational and venerable. To mention just one case that is highly relevant today, in internal discussion in 1958, president Eisenhower expressed concern about “the campaign of hatred” against us in the Arab world, not by governments, but by the people. The National Security Council (NSC) explained that there is a perception in the Arab world that the U.S. supports dictatorships and blocks democracy and development so as to ensure control over the resources of the region. Furthermore, the perception is basically accurate, the NSC concluded, and that is what we should be doing, relying on the Muasher doctrine. Pentagon studies conducted after 9/11 confirmed that the same holds today.

It is normal for the victors to consign history to the trash can, and for victims to take it seriously. Perhaps a few brief observations on this important matter may be useful. Today is not the first occasion when Egypt and the U.S. are facing similar problems, and moving in opposite directions. That was also true in the early nineteenth century.

Economic historians have argued that Egypt was well-placed to undertake rapid economic development at the same time that the U.S. was. Both had rich agriculture, including cotton, the fuel of the early industrial revolution — though unlike Egypt, the U.S. had to develop cotton production and a work force by conquest, extermination, and slavery, with consequences that are evident right now in the reservations for the survivors and the prisons that have rapidly expanded since the Reagan years to house the superfluous population left by deindustrialization.

One fundamental difference was that the U.S. had gained independence and was therefore free to ignore the prescriptions of economic theory, delivered at the time by Adam Smith in terms rather like those preached to developing societies today. Smith urged the liberated colonies to produce primary products for export and to import superior British manufactures, and certainly not to attempt to monopolize crucial goods, particularly cotton. Any other path, Smith warned, “would retard instead of accelerating the further increase in the value of their annual produce, and would obstruct instead of promoting the progress of their country towards real wealth and greatness.”

Having gained their independence, the colonies were free to ignore his advice and to follow England’s course of independent state-guided development, with high tariffs to protect industry from British exports, first textiles, later steel and others, and to adopt numerous other devices to accelerate industrial development. The independent Republic also sought to gain a monopoly of cotton so as to “place all other nations at our feet,” particularly the British enemy, as the Jacksonian presidents announced when conquering Texas and half of Mexico.

For Egypt, a comparable course was barred by British power. Lord Palmerston declared that “no ideas of fairness [toward Egypt] ought to stand in the way of such great and paramount interests” of Britain as preserving its economic and political hegemony, expressing his “hate” for the “ignorant barbarian” Muhammed Ali who dared to seek an independent course, and deploying Britain’s fleet and financial power to terminate Egypt’s quest for independence and economic development.

After World War II, when the U.S. displaced Britain as global hegemon, Washington adopted the same stand, making it clear that the U.S. would provide no aid to Egypt unless it adhered to the standard rules for the weak — which the U.S. continued to violate, imposing high tariffs to bar Egyptian cotton and causing a debilitating dollar shortage. The usual interpretation of market principles.

It is small wonder that the “campaign of hatred” against the U.S. that concerned Eisenhower was based on the recognition that the U.S. supports dictators and blocks democracy and development, as do its allies.

In Adam Smith’s defense, it should be added that he recognized what would happen if Britain followed the rules of sound economics, now called “neoliberalism.” He warned that if British manufacturers, merchants, and investors turned abroad, they might profit but England would suffer. But he felt that they would be guided by a home bias, so as if by an invisible hand England would be spared the ravages of economic rationality.

The passage is hard to miss. It is the one occurrence of the famous phrase “invisible hand” in The Wealth of Nations. The other leading founder of classical economics, David Ricardo, drew similar conclusions, hoping that home bias would lead men of property to “be satisfied with the low rate of profits in their own country, rather than seek a more advantageous employment for their wealth in foreign nations,” feelings that, he added, “I should be sorry to see weakened.” Their predictions aside, the instincts of the classical economists were sound.

The Iranian and Chinese “Threats”

The democracy uprising in the Arab world is sometimes compared to Eastern Europe in 1989, but on dubious grounds. In 1989, the democracy uprising was tolerated by the Russians, and supported by western power in accord with standard doctrine: it plainly conformed to economic and strategic objectives, and was therefore a noble achievement, greatly honored, unlike the struggles at the same time “to defend the people’s fundamental human rights” in Central America, in the words of the assassinated Archbishop of El Salvador, one of the hundreds of thousands of victims of the military forces armed and trained by Washington. There was no Gorbachev in the West throughout these horrendous years, and there is none today. And Western power remains hostile to democracy in the Arab world for good reasons.

Grand Area doctrines continue to apply to contemporary crises and confrontations. In Western policy-making circles and political commentary the Iranian threat is considered to pose the greatest danger to world order and hence must be the primary focus of U.S. foreign policy, with Europe trailing along politely.

What exactly is the Iranian threat? An authoritative answer is provided by the Pentagon and U.S. intelligence. Reporting on global security last year, they make it clear that the threat is not military. Iran’s military spending is “relatively low compared to the rest of the region,” they conclude. Its military doctrine is strictly “defensive, designed to slow an invasion and force a diplomatic solution to hostilities.” Iran has only “a limited capability to project force beyond its borders.” With regard to the nuclear option, “Iran’s nuclear program and its willingness to keep open the possibility of developing nuclear weapons is a central part of its deterrent strategy.” All quotes.

The brutal clerical regime is doubtless a threat to its own people, though it hardly outranks U.S. allies in that regard. But the threat lies elsewhere, and is ominous indeed. One element is Iran’s potential deterrent capacity, an illegitimate exercise of sovereignty that might interfere with U.S. freedom of action in the region. It is glaringly obvious why Iran would seek a deterrent capacity; a look at the military bases and nuclear forces in the region suffices to explain.

Seven years ago, Israeli military historian Martin van Creveld wrote that “The world has witnessed how the United States attacked Iraq for, as it turned out, no reason at all. Had the Iranians not tried to build nuclear weapons, they would be crazy,” particularly when they are under constant threat of attack in violation of the UN Charter. Whether they are doing so remains an open question, but perhaps so.

But Iran’s threat goes beyond deterrence. It is also seeking to expand its influence in neighboring countries, the Pentagon and U.S. intelligence emphasize, and in this way to “destabilize” the region (in the technical terms of foreign policy discourse). The U.S. invasion and military occupation of Iran’s neighbors is “stabilization.” Iran’s efforts to extend its influence to them are “destabilization,” hence plainly illegitimate.

Such usage is routine. Thus the prominent foreign policy analyst James Chace was properly using the term “stability” in its technical sense when he explained that in order to achieve “stability” in Chile it was necessary to “destabilize” the country (by overthrowing the elected government of Salvador Allende and installing the dictatorship of General Augusto Pinochet). Other concerns about Iran are equally interesting to explore, but perhaps this is enough to reveal the guiding principles and their status in imperial culture.  As Franklin Delano Roosevelt’s planners emphasized at the dawn of the contemporary world system, the U.S. cannot tolerate “any exercise of sovereignty” that interferes with its global designs.

The U.S. and Europe are united in punishing Iran for its threat to stability, but it is useful to recall how isolated they are. The nonaligned countries have vigorously supported Iran’s right to enrich uranium. In the region, Arab public opinion even strongly favors Iranian nuclear weapons. The major regional power, Turkey, voted against the latest U.S.-initiated sanctions motion in the Security Council, along with Brazil, the most admired country of the South. Their disobedience led to sharp censure, not for the first time: Turkey had been bitterly condemned in 2003 when the government followed the will of 95% of the population and refused to participate in the invasion of Iraq, thus demonstrating its weak grasp of democracy, western-style.

After its Security Council misdeed last year, Turkey was warned by Obama’s top diplomat on European affairs, Philip Gordon, that it must “demonstrate its commitment to partnership with the West.” A scholar with the Council on Foreign Relations asked, “How do we keep the Turks in their lane?” — following orders like good democrats. Brazil’s Lula was admonished in a New York Times headline that his effort with Turkey to provide a solution to the uranium enrichment issue outside of the framework of U.S. power was a “Spot on Brazilian Leader’s Legacy.” In brief, do what we say, or else.

An interesting sidelight, effectively suppressed, is that the Iran-Turkey-Brazil deal was approved in advance by Obama, presumably on the assumption that it would fail, providing an ideological weapon against Iran. When it succeeded, the approval turned to censure, and Washington rammed through a Security Council resolution so weak that China readily signed — and is now chastised for living up to the letter of the resolution but not Washington’s unilateral directives — in the current issue ofForeign Affairs, for example.

While the U.S. can tolerate Turkish disobedience, though with dismay, China is harder to ignore. The press warns that “China’s investors and traders are now filling a vacuum in Iran as businesses from many other nations, especially in Europe, pull out,” and in particular, is expanding its dominant role in Iran’s energy industries. Washington is reacting with a touch of desperation. The State Department warned China that if it wants to be accepted in the international community — a technical term referring to the U.S. and whoever happens to agree with it — then it must not “skirt and evade international responsibilities, [which] are clear”: namely, follow U.S. orders. China is unlikely to be impressed.

There is also much concern about the growing Chinese military threat. A recent Pentagon study warned that China’s military budget is approaching “one-fifth of what the Pentagon spent to operate and carry out the wars in Iraq and Afghanistan,” a fraction of the U.S. military budget, of course. China’s expansion of military forces might “deny the ability of American warships to operate in international waters off its coast,” the New York Times added.

Off the coast of China, that is; it has yet to be proposed that the U.S. should eliminate military forces that deny the Caribbean to Chinese warships. China’s lack of understanding of rules of international civility is illustrated further by its objections to plans for the advanced nuclear-powered aircraft carrier George Washington to join naval exercises a few miles off China’s coast, with alleged capacity to strike Beijing.

In contrast, the West understands that such U.S. operations are all undertaken to defend stability and its own security. The liberal New Republic expresses its concern that “China sent ten warships through international waters just off the Japanese island of Okinawa.” That is indeed a provocation — unlike the fact, unmentioned, that Washington has converted the island into a major military base in defiance of vehement protests by the people of Okinawa. That is not a provocation, on the standard principle that we own the world.

Deep-seated imperial doctrine aside, there is good reason for China’s neighbors to be concerned about its growing military and commercial power. And though Arab opinion supports an Iranian nuclear weapons program, we certainly should not do so. The foreign policy literature is full of proposals as to how to counter the threat. One obvious way is rarely discussed: work to establish a nuclear-weapons-free zone (NWFZ) in the region. The issue arose (again) at the Non-Proliferation Treaty (NPT) conference at United Nations headquarters last May. Egypt, as chair of the 118 nations of the Non-Aligned Movement, called for negotiations on a Middle East NWFZ, as had been agreed by the West, including the U.S., at the 1995 review conference on the NPT.

International support is so overwhelming that Obama formally agreed. It is a fine idea, Washington informed the conference, but not now. Furthermore, the U.S. made clear that Israel must be exempted: no proposal can call for Israel’s nuclear program to be placed under the auspices of the International Atomic Energy Agency or for the release of information about “Israeli nuclear facilities and activities.” So much for this method of dealing with the Iranian nuclear threat.

Privatizing the Planet

While Grand Area doctrine still prevails, the capacity to implement it has declined. The peak of U.S. power was after World War II, when it had literally half the world’s wealth. But that naturally declined, as other industrial economies recovered from the devastation of the war and decolonization took its agonizing course. By the early 1970s, the U.S. share of global wealth had declined to about 25%, and the industrial world had become tripolar: North America, Europe, and East Asia (then Japan-based).

There was also a sharp change in the U.S. economy in the 1970s, towards financialization and export of production. A variety of factors converged to create a vicious cycle of radical concentration of wealth, primarily in the top fraction of 1% of the population — mostly CEOs, hedge-fund managers, and the like. That leads to the concentration of political power, hence state policies to increase economic concentration: fiscal policies, rules of corporate governance, deregulation, and much more. Meanwhile the costs of electoral campaigns skyrocketed, driving the parties into the pockets of concentrated capital, increasingly financial: the Republicans reflexively, the Democrats — by now what used to be moderate Republicans — not far behind.

Elections have become a charade, run by the public relations industry. After his 2008 victory, Obama won an award from the industry for the best marketing campaign of the year. Executives were euphoric. In the business press they explained that they had been marketing candidates like other commodities since Ronald Reagan, but 2008 was their greatest achievement and would change the style in corporate boardrooms. The 2012 election is expected to cost $2 billion, mostly in corporate funding. Small wonder that Obama is selecting business leaders for top positions. The public is angry and frustrated, but as long as the Muasher principle prevails, that doesn’t matter.

While wealth and power have narrowly concentrated, for most of the population real incomes have stagnated and people have been getting by with increased work hours, debt, and asset inflation, regularly destroyed by the financial crises that began as the regulatory apparatus was dismantled starting in the 1980s.

None of this is problematic for the very wealthy, who benefit from a government insurance policy called “too big to fail.” The banks and investment firms can make risky transactions, with rich rewards, and when the system inevitably crashes, they can run to the nanny state for a taxpayer bailout, clutching their copies of Friedrich Hayek and Milton Friedman.

That has been the regular process since the Reagan years, each crisis more extreme than the last — for the public population, that is. Right now, real unemployment is at Depression levels for much of the population, while Goldman Sachs, one of the main architects of the current crisis, is richer than ever. It has just quietly announced $17.5 billion in compensation for last year, with CEO Lloyd Blankfein receiving a $12.6 million bonus while his base salary more than triples.

It wouldn’t do to focus attention on such facts as these. Accordingly, propaganda must seek to blame others, in the past few months, public sector workers, their fat salaries, exorbitant pensions, and so on: all fantasy, on the model of Reaganite imagery of black mothers being driven in their limousines to pick up welfare checks — and other models that need not be mentioned. We all must tighten our belts; almost all, that is.

Teachers are a particularly good target, as part of the deliberate effort to destroy the public education system from kindergarten through the universities by privatization — again, good for the wealthy, but a disaster for the population, as well as the long-term health of the economy, but that is one of the externalities that is put to the side insofar as market principles prevail.

Another fine target, always, is immigrants. That has been true throughout U.S. history, even more so at times of economic crisis, exacerbated now by a sense that our country is being taken away from us: the white population will soon become a minority. One can understand the anger of aggrieved individuals, but the cruelty of the policy is shocking.

Who are the immigrants targeted? In Eastern Massachusetts, where I live, many are Mayans fleeing genocide in the Guatemalan highlands carried out by Reagan’s favorite killers. Others are Mexican victims of Clinton’s NAFTA, one of those rare government agreements that managed to harm working people in all three of the participating countries. As NAFTA was rammed through Congress over popular objection in 1994, Clinton also initiated the militarization of the U.S.-Mexican border, previously fairly open. It was understood that Mexican campesinos cannot compete with highly subsidized U.S. agribusiness, and that Mexican businesses would not survive competition with U.S. multinationals, which must be granted “national treatment” under the mislabeled free trade agreements, a privilege granted only to corporate persons, not those of flesh and blood. Not surprisingly, these measures led to a flood of desperate refugees, and to rising anti-immigrant hysteria by the victims of state-corporate policies at home.

Much the same appears to be happening in Europe, where racism is probably more rampant than in the U.S. One can only watch with wonder as Italy complains about the flow of refugees from Libya, the scene of the first post-World War I genocide, in the now-liberated East, at the hands of Italy’s Fascist government. Or when France, still today the main protector of the brutal dictatorships in its former colonies, manages to overlook its hideous atrocities in Africa, while French President Nicolas Sarkozy warns grimly of the “flood of immigrants” and Marine Le Pen objects that he is doing nothing to prevent it. I need not mention Belgium, which may win the prize for what Adam Smith called “the savage injustice of the Europeans.”

The rise of neo-fascist parties in much of Europe would be a frightening phenomenon even if we were not to recall what happened on the continent in the recent past. Just imagine the reaction if Jews were being expelled from France to misery and oppression, and then witness the non-reaction when that is happening to Roma, also victims of the Holocaust and Europe’s most brutalized population.

In Hungary, the neo-fascist party Jobbik gained 17% of the vote in national elections, perhaps unsurprising when three-quarters of the population feels that they are worse off than under Communist rule. We might be relieved that in Austria the ultra-right Jörg Haider won only 10% of the vote in 2008 — were it not for the fact that the new Freedom Party, outflanking him from the far right, won more than 17%. It is chilling to recall that, in 1928, the Nazis won less than 3% of the vote in Germany.

In England the British National Party and the English Defence League, on the ultra-racist right, are major forces. (What is happening in Holland you know all too well.) In Germany, Thilo Sarrazin’s lament that immigrants are destroying the country was a runaway best-seller, while Chancellor Angela Merkel, though condemning the book, declared that multiculturalism had “utterly failed”: the Turks imported to do the dirty work in Germany are failing to become blond and blue-eyed, true Aryans.

Those with a sense of irony may recall that Benjamin Franklin, one of the leading figures of the Enlightenment, warned that the newly liberated colonies should be wary of allowing Germans to immigrate, because they were too swarthy; Swedes as well. Into the twentieth century, ludicrous myths of Anglo-Saxon purity were common in the U.S., including among presidents and other leading figures. Racism in the literary culture has been a rank obscenity; far worse in practice, needless to say. It is much easier to eradicate polio than this horrifying plague, which regularly becomes more virulent in times of economic distress.

I do not want to end without mentioning another externality that is dismissed in market systems: the fate of the species. Systemic risk in the financial system can be remedied by the taxpayer, but no one will come to the rescue if the environment is destroyed. That it must be destroyed is close to an institutional imperative. Business leaders who are conducting propaganda campaigns to convince the population that anthropogenic global warming is a liberal hoax understand full well how grave is the threat, but they must maximize short-term profit and market share. If they don’t, someone else will.

This vicious cycle could well turn out to be lethal. To see how grave the danger is, simply have a look at the new Congress in the U.S., propelled into power by business funding and propaganda. Almost all are climate deniers. They have already begun to cut funding for measures that might mitigate environmental catastrophe. Worse, some are true believers; for example, the new head of a subcommittee on the environment who explained that global warming cannot be a problem because God promised Noah that there will not be another flood.

If such things were happening in some small and remote country, we might laugh. Not when they are happening in the richest and most powerful country in the world. And before we laugh, we might also bear in mind that the current economic crisis is traceable in no small measure to the fanatic faith in such dogmas as the efficient market hypothesis, and in general to what Nobel laureate Joseph Stiglitz, 15 years ago, called the “religion” that markets know best — which prevented the central bank and the economics profession from taking notice of an $8 trillion housing bubble that had no basis at all in economic fundamentals, and that devastated the economy when it burst.

All of this, and much more, can proceed as long as the Muashar doctrine prevails. As long as the general population is passive, apathetic, diverted to consumerism or hatred of the vulnerable, then the powerful can do as they please, and those who survive will be left to contemplate the outcome.

Noam Chomsky is Institute Professor emeritus in the MIT Department of Linguistics and Philosophy. He is the author of numerous best-selling political works. Recent books include a new edition of Power and Terror, The Essential Chomsky (edited by Anthony Arnove), a collection of his writings on politics and on language from the 1950s to the present, and Hopes and Prospects, also available as an audiobookHis web site is http://www.chomsky.info. To catch Timothy MacBain’s latest Tomcast audio interview in which Chomsky discusses the recent shredding of the principles of the Magna Carta, click here or download it to your iPod hereThis piece is adapted from a talk given in Amsterdam in March 2011.

Copyright 2011 Noam Chomsky

As I indicated in my introduction, Noam’s website is here.  Hope you can call back tomorrow as I continue with a look at the world we now live in.

Noam Chomsky
Noam Chomsky

What goes up?

Civilizations die from suicide, not by murder. Arnold J Toynbee

I’m not sure where to start but as a result of finishing a particular book, plus a recent essay on Tom Dispatch, then another recent essay from Simon Johnson of Baseline Scenario fame, there were so many thoughts bumping around this aged brain that I had no alternative than to offer them to you, dear reader.  You should also be warned that this is going to be two posts, covering today and tomorrow.

So let’s start with the book: The United States of Fear by Tom Engelhardt.  To be brutally honest, I purchased the book more as a gesture of support to Tom who has been very supportive of Learning from Dogs, in particular allowing me permission to reproduce any essays that were published on TomDispatch, as a number have so been.  What an error of judgment!  Tom’s book provided another one of those rare but inspirational occasions where you know the world will never look quite the same again!

The back cover page of the book sets out the theme, thus,

Published 2011

In 2008, when the US National Intelligence Council issued its latest report meant for the administration of newly elected President Barack Obama, it predicted that the planet’s “sole superpower” would suffer a modest decline and a soft landing fifteen years hence. In his new book The United States of Fear, Tom Engelhardt makes clear that Americans should don their crash helmets and buckle their seat belts, because the United States is on the path to a major decline at a startling speed. Engelhardt offers a savage anatomy of how successive administrations in Washington took the “Soviet path”—pouring American treasure into the military, war, and national security—and so helped drive their country off the nearest cliff.This is the startling tale of how fear was profitably shot into the national bloodstream, how the country—gripped by terror fantasies—was locked down, and how a brain-dead Washington elite fiddled (and profited) while America quietly burned.

Think of it as the story of how the Cold War really ended, with the triumphalist “sole superpower” of 1991 heading slowly for the same exit through which the Soviet Union left the stage twenty years earlier.

One of the fascinating aspects of the book is that it was put together from 32 essays previously published online by Tom; the complete list with titles and dates is on pps. 205 & 206.  So giving you a real feel for the book is easy!  I’m going to do that by linking to one of those essays available in the archives of TomDispatch here.  That essay was called Washington’s Echo Chamber and appears in the book starting on page 170 under the sub-heading of Five Ways to Be Tone Deaf in Washington. Let me quote you a little,

So much of what Washington did imagine in these last years proved laughable, even before this moment swept it away.  Just take any old phrase from the Bush years.  How about “You’re either with us or against us”?  What’s striking is how little it means today.  Looking back on Washington’s desperately mistaken assumptions about how our globe works, this might seem like the perfect moment to show some humility in the face of what nobody could have predicted.

It would seem like a good moment for Washington — which, since September 12, 2001, has been remarkably clueless about real developments on this planet and repeatedly miscalculated the nature of global power — to step back and recalibrate.

As it happens, there’s no evidence it’s doing so.  In fact, that may be beyond Washington’s present capabilities, no matter how many billions of dollars it pours into “intelligence.”  And by “Washington,” I mean not just the Obama administration, or the Pentagon, or our military commanders, or the vast intelligence bureaucracy, but all those pundits and think-tankers who swarm the capital, and the media that reports on them all.  It’s as if the cast of characters that makes up “Washington” now lives in some kind of echo chamber in which it can only hear itself talking.

As a result, Washington still seems remarkably determined to play out the string on an era that is all too swiftly passing into the history books.  While many have noticed the Obama administration’s hapless struggle to catch up to events in the Middle East, even as it clings to a familiar coterie of grim autocrats and oil sheiks, let me illustrate this point in another area entirely — the largely forgotten war in Afghanistan.  After all, hardly noticed, buried beneath 24/7 news from Egypt, Bahrain, Libya, and elsewhere in the Middle East, that war continues on its destructive, costly course with nary a blink.

That was published by Tom a little over 18 months ago!  Seems as relevant today as then!  Let me stay with perspectives from 2011.

Chomsky, visiting Vancouver, Canada in March 2004

On the 24th August 2011 Noam Chomsky wrote an essay entitled American Decline: Causes and Consequences.  Chomsky, as Wikipedia relates, is Professor (Emeritus) in the Department of Linguistics & Philosophy at MIT, where he has worked for over 50 years.  Here is how that essay opens,

In the 2011 summer issue of the journal of the American Academy of Political Science, we read that it is “a common theme” that the United States, which “only a few years ago was hailed to stride the world as a colossus with unparalleled power and unmatched appeal — is in decline, ominously facing the prospect of its final decay.” It is indeed a common theme, widely believed, and with some reason. But an appraisal of US foreign policy and influence abroad and the strength of its domestic economy and political institutions at home suggests that a number of qualifications are in order. To begin with, the decline has in fact been proceeding since the high point of US power shortly after World War II, and the remarkable rhetoric of the several years of triumphalism in the 1990s was mostly self-delusion. Furthermore, the commonly drawn corollary — that power will shift to China and India — is highly dubious. They are poor countries with severe internal problems. The world is surely becoming more diverse, but despite America’s decline, in the foreseeable future there is no competitor for global hegemonic power.

So, according to Chomsky, it’s not as ‘black and white’ as Engelhardt sets out.  But do read the full essay.

Nevertheless, the idea that the USA is ‘fiddling while Rome burns’ is supported in an essay published by Mattea Kramer on TomDispatch on the last day of September.  I’m going to end Part One by republishing the essay in full.  (Note that this is being published here after the first ‘debate’ had taken place.)

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Tough Talk for America

A Guide to the Presidential Debates You Won’t Hear 
By Mattea Kramer

Five big things will decide what this country looks like next year and in the 20 years to follow, but here’s a guarantee for you: you’re not going to hear about them in the upcoming presidential debates. Yes, there will be questions and answers focused on deficits, taxes, Medicare, the Pentagon, and education, to which you already more or less know the responses each candidate will offer. What you won’t get from either Mitt Romney or Barack Obama is a little genuine tough talk about the actual state of reality in these United States of ours. And yet, on those five subjects, a little reality would go a long way, while too little reality (as in the debates to come) is a surefire recipe for American decline.

So here’s a brief guide to what you won’t hear this Wednesday or in the other presidential and vice-presidential debates later in the month. Think of these as five hard truths that will determine the future of this country.

1. Immediate deficit reduction will wipe out any hope of economic recovery: These days, it’s fashionable for any candidate to talk about how quickly he’ll reduce the federal budget deficit, which will total around $1.2 trillion in fiscal 2012. And you’re going to hear talk about the Simpson-Bowles deficit reduction plan and more like it on Wednesday. But the hard truth of the matter is that deep deficit reduction anytime soon will be a genuine disaster. Think of it this way: If you woke up tomorrow and learned that Washington had solved the deficit crisis and you’d lost your job, would you celebrate? Of course not. And yet, any move to immediately reduce the deficit does increase the likelihood that you will lose your job.

When the government cuts spending, it lays off workers and cancels orders for all sorts of goods and services that would generate income for companies in the private sector. Those companies, in turn, lay off workers, and the negative effects ripple through the economy. This isn’t atomic science. It’s pretty basic stuff, even if it’s evidently not suitable material for a presidential debate. The nonpartisan Congressional Research Service predicted in a September report, for example, that any significant spending cuts in the near-term would contribute to an economic contraction. In other words, slashing deficits right now will send us ever deeper into the Great Recession from which, at best, we’ve scarcely emerged.

Champions of immediate deficit reduction are likely to point out that unsustainable deficits aren’t good for the economy. And that’s true — in the long run. Washington must indeed plan for smaller deficits in the future. That will, however, be a lot easier to accomplish when the economy is healthier, since government spending declines when fewer people qualify for assistance, and tax revenues expand when the jobless go back to work. So it makes sense to fix the economy first. The necessity for near-term recovery spending paired with long-term deficit reduction gets drowned out when candidates pack punchy slogans into flashes of primetime TV.

2. Taxes are at their lowest point in more than half a century, preventing investment in and the maintenance of America’s most basic resources: Hard to believe? It’s nonetheless a fact. By now, it’s a tradition for candidates to compete on just how much further they’d lower taxes and whether they’ll lower them for everyone or just everyone but the richest of the rich. That’s a super debate to listen to, if you’re into fairy tales. It’s not as thrilling if you consider that Americans now enjoy the lightest tax burden in more than five decades, and it happens to come with a hefty price tag on an item labeled “the future.” There is no way the U.S. can maintain a world-class infrastructure — we’re talking levees, highways, bridges, you name it — and a public education system that used to be the envy of the world, plus many other key domestic priorities, on the taxes we’re now paying.

Anti-tax advocates insist that we should cut taxes even more to boost a flagging economy — an argument that hits the news cycle nearly every hour and that will shape the coming TV “debate.” As the New York Times recently noted, however, tax cuts might have been effective in giving the economy a lift decades ago when tax rates were above 70%. (And no, that’s not a typo, that’s what your parents and grandparents paid without much grumbling.) With effective tax rates around 14% for Mitt Romney and many others, further cuts won’t hasten job creation, just the hollowing out of public investment in everything from infrastructure to education. Right now, the negative effects of tax increases on the most well-off would be small — read: not a disaster for “job creators” — and those higher rates would bring in desperately-needed revenue. Tax increases for middle-class Americans should arrive when the economy is stronger.

Right now, the situation is clear: we’re simply not paying enough to fund the basic ingredients of prosperity from highways and higher education to medical research and food safety. Without those funds, this country’s future won’t be pretty.

3. Neither the status quo nor a voucher system will protect Medicare (or any other kind of health care) in the long run: When it comes to Medicare, Mitt Romney has proposed a premium-support program that would allow seniors the option of buying private insurance. President Obama wants to keep Medicare more or less as it is for retirees. Meanwhile, the ceaseless rise in health-care costs is eating up the wages of regular Americans and the federal budget. Health care now accounts for a staggering 24% of all federal spending, up from 7% less than 40 years ago. Governor Romney’s plan would shift more of those costs onto retirees, according to David Cutler, a health economist at Harvard, while President Obama says the federal government will continue to pick up the tab. Neither of them addresses the underlying problem.

Here’s reality: Medicare could be significantly protected by cutting out waste. Our health system is riddled with unnecessary tests and procedures, as well as poorly coordinated care for complex health problems. This country spent $2.6 trillion on health care in 2010, and some estimates suggest that a staggering 30% of that is wasted. Right now, our health system rewards quantity, not quality, but it doesn’t have to be that way. Instead of paying for each test and procedure, Medicare could pay for performance and give medical professionals a strong incentive to provide more efficient and coordinated care. President Obama’s health law actually pilot tests such an initiative. But that’s another taboo topic this election season, so he scarcely mentions it. Introducing such change into Medicare and the rest of our health system would save the federal government tens of billions of dollars annually. It would truly preserve Medicare for future generations, and it would improve the affordability of health coverage for everyone under 65 as well. Too bad it’s not even up for discussion.

4. The U.S. military is outrageously expensive and yet poorly tailored to the actual threats to U.S. national security: Candidates from both parties pledge to protect the Pentagon from cuts, or even, in the case of the Romney team, to increase the already staggering military budget. But in a country desperate for infrastructure, education, and other funding, funneling endless resources to the Pentagon actually weakens “national security.” Defense spending is already mind-numbingly large: if all U.S. military and security spending were its own country, it would have the 19th largest economy in the world, ahead of Saudi Arabia, Taiwan, and Switzerland. Whether you’re counting aircraft carriers, weapons systems, or total destructive power, it’s absurdly overmatched against the armed forces of the rest of the world, individually or in combination. A couple of years ago, then-Secretary of Defense Robert M. Gates gave a speech in which he detailed that overmatch. A highlight: “The U.S. operates 11 large carriers, all nuclear powered. In terms of size and striking power, no other country has even one comparable ship.” China recently acquired one carrier that won’t be fully functional for some time, if ever — while many elected officials in this country would gladly build a twelfth.

But you’ll hear none of this in the presidential debates. Perhaps the candidates will mention that obsolete, ineffective, and wildly expensive weapons systems could be cut, but that’s a no-brainer. The problem is: it wouldn’t put a real dent in national defense spending. Currently almost one-fifth of every dollar spent by the federal government goes to the military. On average, Americans, when polled, say that they would like to see military funding cut by 18%.

Instead, most elected officials vow to pour limitless resources into more weapons systems of questionable efficacy, and of which the U.S. already owns more than the rest of the world combined. Count on one thing: military spending will not go down as long as the U.S. is building up a massive force in the Persian Gulf, sending Marines to Darwin, Australia, and special ops units to Africa and the Middle East, running drones out of the Seychelles Islands, and “pivoting” to Asia. If the U.S. global mission doesn’t downsize, neither will the Pentagon budget — and that’s a hit on America’s future that no debate will take up this month.

5. The U.S. education system is what made this country prosperous in the twentieth century — but no longer: Perhaps no issue is more urgent than this, yet for all the talk of teacher’s unions and testing, real education programs, ideas that will matter, are nonexistent this election season. During the last century, the best education system in the world allowed this country to grow briskly and lift standards of living. Now, from kindergarten to college, public education is chronically underfunded. Scarcely 2% of the federal budget goes to education, and dwindling public investment means students pay higher tuitions and fall ever deeper into debt. Total student debt surpassed $1 trillion this year and it’s growing by the month, with the average debt burden for a college graduate over $24,000. That will leave many of those graduates on a treadmill of loan repayment for most or all of their adult lives.

Renewed public investment in education — from pre-kindergarten to university — would pay handsome dividends for generations. But you aren’t going to hear either candidate or their vice-presidential running mates proposing the equivalent of a GI Bill for the rest of us or even significant new investment in education. And yet that’s a recipe for and a guarantee of American decline.

Ironically, those in Washington arguing for urgent deficit reduction claim that we’ve got to do it “for the kids,” that we must stop saddling our grandchildren with mountains of federal debt. But if your child turns 18 and finds her government running a balanced budget in an America that’s hollowed out, an America where she has no chance of paying for a college education, will she celebrate? You don’t need an economist to answer that one.

Mattea Kramer is senior research analyst at National Priorities Project and a TomDispatch regular. She is lead author of the new book A People’s Guide to the Federal Budget.

Copyright 2012 Mattea Kramer

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Let me close with another quote from Arnold J. Toynbee:

Of the twenty-two civilizations that have appeared in history, nineteen of them collapsed

when they reached the moral state the United States is in now.

Part Two continues tomorrow.

A view from the Radical Middle

Promoting the thoughts of Per Kurowski.

A few days ago, I published a delightful story sent to me by Richard Maugham about Helga’s Bar.  It was a tongue-in-cheek look at the crazy world of finance and banking that we seem to be living in at present.

One of the regular readers of Learning from Dogs is Per Kurowski and he left a couple of comments.  The first being,

As a former ED at the World Bank, 2002-2004, living close to Washington, writing articles and being an assiduous blogger, I’ve been in the middle of many discussions about those many of the challenges our world faces. And my friend, I am sorry to say, our prospects to solve these problems, do not seem good.

One of the main reasons for that negative outlook, is that I have been able to witness how the discussion of many of these problems, no matter how urgent these are, so often get hijacked by a political agenda, or by a group that decides making a business, or a living, out of it.

If we cannot break out of this mold, unfortunately, the world is toast, and this, not only from a global warming perspective.

which was then followed up by,

By the way, I managed to sit down a prominent and important bank regulator in my chair yesterday, though he was invisible and quite silent!

I then replied,

Per, just love that. Any chance of you penning a guest post that could set the background to that video in terms that make it easy for the punter to understand?

So here is Per’s interview (sound volume is a little low) and his views.

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Paul… well here is “a brief summary of my thoughts on banks and risks”

Capital requirements for banks which are lower when the perceived risk of default of the borrower is low, and higher when the perceived risk is high, distort the economic resource allocation process. This is so because those perceptions of risk have already been cleared for, by bankers and markets, by means of interest rates and amounts of exposures.

All the current dangerous and obese bank exposures are to be found in areas recently considered as safe and which therefore required these banks to hold little capital. What was considered as “risky” is not, as usual, causing any problems. This is not a crisis caused by excessive risk taking by the banks, but by excessive regulatory interference by naïve and nanny type regulators.

And, if that distortion is not urgently eliminated, all our banks are doomed to end up gasping for oxygen and capital on the last officially perceived safe beach… like the US Treasury or the Bundesbank.

Bank regulators have no business regulating based on risk perceptions being right, their role is to prepare for when these perceptions turn out to be wrong.

A nation that cares more for history, what it has got, the haves, the “not-risky”, the AAA rated or the “infallible” sovereigns, than for the future, what it can get, the not-haves, the risky, the small businesses or the entrepreneurs, is a nation on its way down.

Per.

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You may read more from Per on his blog here, and also read Per’s Tea with FT blog!  So let me close by saying that Per’s summary seems like a blast of sanity in an otherwise crazy world!