Tuesday, June 23, 2009

Or we could try democracy

I've been meaning to write some posts on the aftermath of the perfect storm that came and went, leaving too little changed. Benign Brodwicz, at Animal Spirits, summarized my pessimistic view of current trends.

The Animal Spirits Page: On the coming neo-feudalism:
"It does seem as if the vast majority of people in the United State of America are going to become like medieval serfs, living at what feels in the post-gilded-age new realities like subsistence, watching a small slice of society from a distance as they jet in and out of the country, monopolize the ski resorts, continue to live in big houses with two or three thousand square per person, and so on.

The Baby Boom doesn’t have enough money to retire (quaint notion) and will be working till they drop, which will actually extend their lives. The Gen X’ers will continue to live on scraps. The Millennials are idealistically waiting their turn to be heroes while trying to find a way to support themselves in a workforce that is top-heavy with whining Boomers and cagey Gen X’ers. Most of us will work for large or small corporations at a wage that is enough to support a modest lifestyle, but holidays will be spent close to home. We will worry that we may be next to join the ranks of the unemployed, many of whom and whose stories we know—stories of lost jobs, houses, children’s sense of security in forced moves to strange communities. The health consequences of the current crisis are no doubt predictable. In a PBS special on other countries’ health programs, a German was asked if unemployed people lose their health benefits there. Of course not, he said. They are under great stress and risk to their health. They need health benefits more than anyone.

For a developed nation, America is a barbaric place.

Demand will not recover. The Stimulus, piling upon preexisting terrifying trillions in deficits courtesy of Bush, will not work. Spending will be cut to satisfy our external creditors. The sheer weight of the debt will slow the economy. The narrow U3 unemployment rate will rise into the double digits and stay there through the president’s term. The “real” under- and unemployment rate U6 will hit twenty percent, and stay in the high teens.

The poor and disenfranchised may even take to the streets at some point. Americans are pretty timid now, worried that they’ll be called terrorists and disappear in the night or be put on the no-fly list. Habeas corpus is gone. Last September Hank Paulson said we may need martial law. The government has been preparing for it. There are empty prison camps standing ready, according to reliable reports. (Many were built by Halliburton, allegedly.) The Katrina experience showed us what to expect: mercenaries will disarm the public; impose martial law; tell you to stay in your house or get shot. FEMA’s National Level Exercise scheduled for late July is supposedly a counter-terrorism drill, but I would bet it involves practicing how to impose martial law. Some believe the true purpose of the exercise itself will be to disarm the public. Lots of luck with that. That might provoke the first shots of a revolution. But perhaps that is the intent, to show force and discourage any further dissent. Like Iran now. Like China twenty years ago.

Will President Obama be able to prevent this? I don’t think so. His government has thrown trillions at financial institutions, but we don’t even have workfare or income support for the long-term unemployed, and not everyone is even covered by unemployment insurance. There are 25 million people in the U6 category today. What happens when there are 50 million? Will the government help them, or try to lock them all up? We have a higher percentage of our population behind bars than any other developed country. Will the fortunate just sit in their houses and hope that the Xe guys (formerly Blackwater—great name for a mercenary outfit) will protect them and their property from roving gangs?

Americans have lost confidence in their government and themselves. Their elected representatives do not listen to them. The President is an agent of the status quo. He has enabled the largest wealth transfer to a privileged elite in American history during the financial crisis, at the expense of the American taxpayer for years to come. Does any American believe the new financial regulations will break the grip of the rich upon the resources of the nation? Will we all come together all can-do, gung-ho style and pitch in together and the income distribution suddenly become more equal as it did in World War II and pull ourselves out of this?

It ain’t happening.

These problems, of course, are replicated in many other countries, including our ostensible long-term rival and enemy, China. Which is why the next ten years are a breeding ground for fascism around the world, and for the seeds of war. We went into Iraq to build military bases to protect “our” oil, if push comes to shove. But our military policies are backward-looking to the last war, as John Robb and others point out. We will look pretty stupid when someone pulls off what Robb calls a systempunkt right here at home while we’re blowing billions in Afghanistan. We don’t require our kids to get educated well. Obama is backing off a single-payer health insurance plan, the one preferred by the American people and the one that makes the most sense from an insurance point of view. The American social contract is broken.

People say Europe will be a museum in a decade, a lot of pretty castles and tourist attractions and mamoni hanging around at cafes. America might be like a ski resort, with some beautiful neighborhoods in the cities and trailer parks outside where the workers and retired people live. The Chinese will buy up real estate and companies and immigrate in large numbers, as they did to Vancouver from Hong Kong, having bought enough members of Congress to get their way. They won the financial war, fair and square. They might even teach us how to make state capitalism work, as the Japanese taught us how to make quality automobiles.

Or we could try democracy, for a change."