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Sunday, October 26, 2014

Why are They Afraid of Thomas Piketty?

When I first wrote about Thomas Piketty and his book-- a month before the publication of the English language edition of Capital in the Twenty-first Century-- I felt confident that he, and it, would have a large impact even beyond the academic community. For sure, I never expected it to be a best-seller, but I thought I saw the book filling a particular, urgent need for one segment of the political spectrum. While others noted the book's timely appearance in the wake of the 2007-2008 economic catastrophe and arrival concurrent with attention to revealed trends in inequality, my sense was that the book would be received as a godsend by liberals and social democrats.
Though the crisis cast a long ideological shadow over neo-classical economics and its associated policies, the widely expected return to the Keynesianism of the post-war era never materialized. Despite the best efforts of high-exposure, acclaimed economists like Joseph Stiglitz and Paul Krugman, New Deal-like policy prescriptions failed to gain popular traction or political support. The dashed high hopes invested in center-left governments in the UK, the US and, most recently, France, further disappointed reform-minded forces in North America and Europe. Accordingly, hopes of turning away from the conservative, free-market paradigm of the last thirty-five years were at a low ebb before Piketty's book.
It was my view that the Piketty book would be enthusiastically welcomed outside of the conservative consensus. His exposure of historical patterns of inequality demonstrates the tendency of capitalism to generate inequality, a condition seeming to cry out for a remedy. In Piketty's research and his theoretical claims, liberals and social democrats might find a new foundation for reforms, even a grand assault on conservative hegemony. Indeed, some economists have likened the anticipated impact of Piketty's book to the much earlier publication of Keynes's General Theory of Employment, Interest, and Money.
Indeed, the Piketty phenomenon continues to draw interest. My Google alerts on “Piketty” show fewer entries, but continue unabated. Yet liberal and social democratic ideologues and policy makers are not nearly as enthusiastic as I expected. The initial euphoria has been tempered as Piketty's ideas are digested and their implications carefully examined.
A recent issue of Real World Economics Review demonstrates the widespread and growing hesitancy to accept Piketty as the messiah of reform. Friends in the Communist Party of Ireland brought attention to the Review's Special Issue on Piketty's Capital in which 17 economists of liberal and social democratic persuasion reflect on the popular book.
The “Respectable” Left Sours on Piketty
The participants in the RWER forum are established social scientists sincerely troubled by persistence of inequality and poverty. Some-- Yanis Varoufakis, Ann Pettifor, Richard Parker, Michael Hudson, James K. Galbraith, and Dean Baker-- are prominent commentators in liberal and left circles. All express admiration for Piketty's success in drawing attention to inequality. Yet nearly all are uncomfortable with his research results and theoretical claims. Some challenge his “fundamental laws of capitalism,” others his “determinism.” In the end, the stone in the shoe of these liberal or social democratic thinkers is Piketty's notion that, ceteris parebis, capitalism systemically produces and reproduces inequality. Dean Baker confirms this when he states: “It is the adoption of policies that were friendly to these business interests that led to the increase in profit shares in recent years, not any inherent dynamic of capitalism, as some may read Piketty as saying.” (My italics)
It is the “inherent dynamic of capitalism” that troubles liberals and social democrats. If capitalism necessarily generates inequality, if inequality follows from the laws of capitalist development, then reforms will never satisfactorily conquer social inequality. Should it be true that inequality is a systemic product of capitalism, then a basket of reforms, as advocated by nearly all of the RWER commentators (and Piketty), will, at best, only slow or retard the growth of inequality.
It is this question that separates capitalist reformers from socialists, and social democrats from Marxists. Marxists embrace Piketty's claim that inequality is the capitalist norm, that periods of diminishing inequality are the exceptions. Moreover, the very logic of capitalism, with exploitation at its core, promises to increase inequality. For capitalism to continue, capital must accumulate-- not in social consumption, but in investment targeted to more accumulation. Efforts to resist, reform or regulate will only retard that process.
For sure, progressive governments may enact reforms to redistribute wealth, but eventually this inhibits accumulation and results in a capital strike or capital flight. Capitalism is not an equality-generating mechanism. Nor is it equality tolerant.
Labor may fight for a larger share of wealth, but only to be trumped by capitalist threats of plant closure or mass unemployment. Today's collaborative labor leaders are caught in the compromised position of being both an agent for corporate profitability and an advocate for working class living standards. Surely no advance against inequality is possible in the face of this dilemma.
The RWER writers would prefer to address the decades since Reagan and Thatcher rather than the centuries studied by Piketty. Where Piketty finds a long-term tendency for capitalism to generate growing and extreme inequality, they prefer to ignore that elephantine fact and debate the causes of growing inequality since the nineteen seventies.
They are intent upon ignoring centuries of enduring inequality because accepting that reality would cast doubt on the possibility that equality and capitalism are compatible, that the capitalist system can be reformed. Piketty's long-term data and theoretical argument challenge that possibility.
Rather than accept the implications of capitalism's long-term tendency, its centuries-old trajectory, liberals and social democrats point to the historically brief respite from income inequality after World War II (in the US and parts of Europe) along with the post-war expansion of the welfare state as a kind of golden age for social democracy. They see the abrupt turn away from the moderation of inequality-- occurring only some twenty-five years later-- not as a return to the normal course of capitalism, but as a political coup against tamed and tempered capitalism. With little more than nostalgia to support this view, reformists cling to the illusion that an egalitarian, humane capitalism is in the cards. Liberals and social democrats refuse to see the maintenance and growth of inequality as systemic; rather they want to believe that growing inequality is merely a matter of political choices. Thus, they rail against the ideology of “neo-liberalism,” as though the explosion of inequality in North America and Europe over the last 30-40 years was the result of a right-wing confidence game and not driven by the logic of capitalism. “Defeating neo-liberalism” has become a convenient mantra for those ill-disposed to fighting for a new socio-economic order: socialism.
Writing for the RWER forum, Claude Hillinger bluntly states his opposition to Piketty and his allergy to capitalism as inequality's father: “By treating inequality as an economic problem, Piketty diverts attention away from what it really is–a political problem.”
A “political problem” that has proven intractable for hundreds of years under capitalism? A “political problem” better solved under twentieth-century socialism than by any and all twentieth-century bourgeois politicians? A “political problem” only if we choose to slight or ignore Piketty's data.
It is an unpleasant, unstated truth that liberals and social democrats are much more comfortable addressing the concept of poverty rather than inequality. Under capitalism, alleviating the pain of those at the very bottom of the economic hierarchy appears to be much easier and more desirable than tackling the economic hierarchy in its entirety. Not surprisingly, many well-compensated academics are impressed with their own merit and, thus, find a ready defense of the hierarchy of inequality.
RWER contributor V.A. Beker gently attempts to move the spotlight on to poverty: “Let me now ask an awkward question. Should reduction of inequality or reduction of poverty be our main concern?” Certainly by reducing the target to poverty, the question of inequality's relationship to capitalism can be evaded.
Another evasion is to interpret “egalitarianism” as “procedural egalitarianism,” as does YanisVaroufakis in the EWER forum. While taking a gratuitous, but well-deserved pot shot at John Rawls's liberal theory of distributive justice, Varoufakis cavalierly dismisses all distributive egalitarianism in favor of procedural justice, a lofty euphemism for “equal opportunity.” Proponents of “procedural egalitarianism” claim victory for equality when the rules of life apply equally to everyone. Outcomes are irrelevant if no one violates the shared mutually agreeable procedures, standards, or rules of participation. Everyone has the same opportunity-- the “created equal...” of the US Declaration of Independence.
Thus, nine innings of baseball, played according to the rules, constitute an example of procedural justice. And while the outcome might be lopsided, the game would be played consistent with procedural egalitarianism.
What the advocates of procedural justice dare not address is the case of a Little League team playing the Chicago Cubs. While the rules of that game may be assiduously observed, the outcome is certainly not fair, just, or egalitarian. I doubt if any political philosophers would show enough confidence in procedural justice to bet on the Little League team.
Should the advocates of procedural justice modify the rules of baseball to disallow the inequality of resources or skills enjoyed by the Cubs, they must also recognize that outside of the world of games, differential resources and skills always affect fairness, justice, and equality. Accordingly, “procedural” egalitarianism can be no answer to inequality, unless it comes to grips with the inequality of resources, skills, and power ever present in capitalism. But addressing questions of asset distribution returns us to distributive justice and, ultimately, how capitalism distributes these assets.
Try as they may, liberals and social democrats are faced with an impossible task in imagining a capitalist world that evades or transcends the inequalities of the system's past. Inequality is inherent in capitalism, deeply embedded in its genetic code.
Piketty's conclusions from studying “la longue durée” of inequality-- its trajectory over centuries-- stands as an obstacle to those who believe the myth of capitalism without inequality. Or put another way, the results stymy those who want equality without socialism.
Zoltan Zigedy

Friday, September 19, 2014

The Chronic Crisis, with Worse to Come?

Looking back on the ten years following the 1929 stock market crash, Marxist economist and Science and Society co-editor, Vladimir D. Kazakevich, wrote of the “chronic crisis” that persisted throughout the nineteen thirties in the US (“The War and American Finance,” Science and Society, Spring 1940). Kazakevich drew attention to the stagnation that lasted over the decade, noting that after World War One, the United States became the most dominant economy in the world. Yet “[a]s the most powerful capitalist country, the United States developed particularly glaring financial weaknesses, attributable, for the most part, precisely to its foremost place in a capitalist world torn by economic contradiction and frustration.”
Kazakevich, a good Marxist instead of a born-again Keynesian, reflected on the collapse of growth of the capital goods sector through the New Deal decade: “These figures show how enormously capitalist activity had shrunk in the thirties as compared to the twenties. Most of the Federal expenditures of the New Deal period were directed towards sustaining the demand for consumers' goods rather than for capital or producers' goods... Although widely advocated, 'priming of the pump' from the end of consumers' goods alone, has proved a complete failure as an economic measure for resuscitation of the capitalist organization harassed by a chronic crisis.”
Economic commentators today are increasingly nervous about a similar slump in capital goods accompanying our own “chronic crisis.” Because the growth of capital spending (and capital equipment spending) is running well below its long-term average of 8% (growing just 3% in 2013), the average age of industrial machinery and equipment in the US has surpassed 10 years, the highest average age since 1938 when Kazakevich was painting his dire picture! (The Wall Street Journal, 9-3-14) Thus, the slug-like motion of the US economy during the last seven years mimics in an important way the stagnation following the great crash initiating the Great Depression.
While capital spending may not now play quite the decisive role it played in the US economy during the 1930s, it remains a strong indicator of the hesitancy of managers to expand the productive core of the economy. They fail to see prospects for profit expansion in the extensive growth or retooling of the manufacturing sector. Of course that does not mean that managers are not seeking profits or investors are not seeking a return on investment. Managers have plowed more cash into mergers and acquisitions during the first half of 2014 than any time since 1999. That also is typically a part of capitalist restructuring after a severe crash. This rationalizing of capitalist production serves and has served to restore the growth of profit following a capitalist misadventure.
In the wake of the crash of 2007-2008 the US economy experienced a dramatic jump in labor productivity (in the absence of capital investment, this necessarily came largely from an increase in the rate of exploitation). Massive layoffs, plant closings, and weak union leadership combined wage stagnation with extreme speed up of a shrunken labor force. Profits ensued. And consequently the previously depressed rate of profit resumed its growth.
Unfortunately for the prospects of capitalism, the growth of productivity has petered out: its past 5-year average is only slightly more than half of the 20-year average, with productivity actually falling 1.7% in the first quarter of 2014. So this road to profit recovery and growth is seemingly closed.
Of course if the past productivity gains had been shared with the working class, capitalism likely would have experienced an increase in revenues (folks would have purchased more goods and services) and a rosier earnings outlook. But that did not happen. Adjusted for inflation, the cumulative growth of median household income has dropped precipitously since the crash, settling at the level of 1990. Consequently, corporate revenue growth peaked in the third quarter of 2011 and has shrunk ever since.
Thus, three signal measures promising profit-rate increases-- capital investment, labor productivity, and revenue increases-- are failing the US economy.
Not surprisingly, reported corporate profit growth has suffered. From its peak in the last quarter of 2009 (over 10%), it has receded steadily.
Profits, Profits, Profits!
It is important to emphasize that it is profits that fuel the capitalist system. While it seems an obvious point, it is the starting point of the Marxist theory of crisis. The capitalist system only appears healthy when the capitalist both holds capital and expects a return. He or she dreads two things: idle capital (capital with no prospect of return) and a stagnant or declining rate of return. Consequently, capitalism generates systemic growth if and only if capital is abundant, investment opportunities are rife, and the rate of profit is sufficiently enticing.
But this law of capitalist accumulation contains the seeds of capitalist crisis. As noted above, the growth of the rate of profit has been declining for some time. At the same time, the accumulation of capital is expanding faster than the overall US economy. The relative mass of profits-- measured by US corporate profits as a percentage of GDP-- reached unprecedented levels in the second quarter of 2014 (a level of profit/GDP only approached twice since 1947: immediately before the crash and in 1950). In other words, despite the fall in the rate of profit, the profit-generating capitalist engine is producing potential new capital faster than wealth is being produced. Three conclusions follow: capital is winning the class war, growth is lagging, and the mass of capital is growing relative to the size of the economy while the profit rate is declining.
And new capital must seek a home, a place to go to accumulate more capital.
Combine the profit-generated capital with the unprecedented cash held by corporations and the availability of cheap credit (nearly non-existent interest rates) and the capitalist class is faced with a daunting task of finding investment opportunities for a vast pool of capital.
If this sounds familiar, it is. Before the crash, many economic commentators noted that the investment world was awash in cash searching for opportunities. I wrote in April of 2007 (Tabloid Political Economy: The Coming Depression, Marxism-Leninism Today, April 5, 2007) that “Despite being awash in capital, financial power searches for investment opportunities to no avail. Economic theorists have been puzzled by the low returns available, even for high-risk or long-term investment. Under normal circumstances, risk and patience earn a premium in investment, but not today. Instead, the enormous pool of wealth concentrated in fewer hands can only lure borrowers at modest rates. There is simply too much accumulated wealth pursuing too few investment opportunities.”
It is this paradox of accumulation-- two much capital, too few opportunities-- that collapses the already stressed rate of profit and courts structural crisis (or deepening crisis, in our case). It is this paradox of accumulation that drives capital-gorged investors to pursue riskier and more ephemeral schemes.
Once again a vast pool of capital chases diminishing investment opportunities. Once again, as in the prelude to the crash, yields have shrunk, leading investors into riskier and more speculative investments. Pension funds and hedge funds are moving toward more arcane and less safe bets, hoping that return will outweigh the danger. As Richard Barley perceptively observes in the Wall Street Journal (August 11, 2014):
...there is a dearth of high quality securities. Yet there is still a global glut of capital seeking a home... All this creates incentives for financial engineering. In credit derivatives markets, there are signs investors are delving into esoteric structures. Citigroup reports a “large increase” in trading of products that slice and dice exposure to defaults in credit-default-swap indexes... Precrisis, low yields and seemingly benign market conditions led to the creation of instruments that ultimately few understood. The longer the reach for yield persists, the greater the chance that investors revisit the unhappy past.
For some time, the elusive “reach for yield” has driven a re-vitalized junk-bond market. In the five years after the crash, four of the ten fastest-growing bond funds held substantial quantities of low rated debt, according to WSJ analysts. They note that this “...development underscores the intense demand for investment returns since the 2008 crisis.”
But the flow of cash to the high yield market depressed yields to levels unseen since late 2007. They are rising again as investors sense that global economic turmoil and low yields signal danger.
The mania for mergers and acquisitions has also swung into dangerous, risky territory. Despite Federal guidelines urging the limitation of leverage to six times gross earnings by banks financing acquisitions, forty percent of private-equity takeovers in 2014 have exceeded the 6X rule. This rate is fast approaching the pre-crisis level of 2007.
The Wealth Effect
A seemingly robust stock market and a relatively stable US debt market join to create the illusion of a healthy, prosperous economy. They have, to great effect, masked the serious cracks in US capitalism.
The long anticipated Federal Reserve retreat from QE (Quantitative Easing: the purchase of US and other debt by the Fed) has not brought the disaster that many in the punditry and on Wall Street feared. Seldom noted, however, is the fact that the Peoples Republic of China has escalated its purchase of US treasuries nearly dollar for dollar against the Federal Reserve's retreat.
The “stellar” performance of equities is another matter. One moderately alarming sign is the steady march of equity price-to-earnings ratios to a territory greater than the long-term average and to a level equal to or above that of 2006-2007. Of course this alone does not explain the market's performance.
A puzzling aspect of equity price expansion is the historically low market activity in the post-crash period. What, then, has jacked up stock prices?
Part of the answer lies in corporate repurchases of shares, a practice that elevates the market price by taking stocks off the table. The Wall Street Journal (9-16-14) reports that $338.2 billion of equities were bought back by corporations in the first half of 2014, the most since 2007. The same report noted that corporations in the second quarter of 2014 spent “31% of their cash flow on buybacks.”
Corporations are hoarding cash and amassing debt at unprecedented levels (thanks to low interest rates, corporate bond issuance may approach $1.5 trillion this year, having grown geometrically over the last twenty years). Thus, corporate activity has shifted away from investing in future growth and toward mergers and acquisitions and stock buybacks, activities that bolster share inflation without creating underlying value.
Take Apple, for example. Sitting on vast quantities of cash, Apple nonetheless sold $12 billion worth of corporate bonds this year. At the same time, Apple repurchased $32.9 billion in Apple stocks, effectively driving up the price of those shares remaining in the market place.
Does this really create wealth? Or is it a ruse to keep the party going?
Interestingly, it’s not just the jaundiced Marxist eye that peers through the fog to see rocky shoals ahead. Rob Buckland, a CITIGROUP analyst, perceives the US economy as entering “phase three,” the phase preceding a marked downturn. Business Insider (August 15, 2014) summarizes Buckland's phase three as follows:
Phase 3: This is the tricky part. Stocks are still flying high, but credit spreads are widening as investors become increasingly unwilling to finance further risk. Corporate CEOs have now experienced a lengthy period of gains and become risk-happy. (And we'd note that central banks are already talking about tightening credit by raising interest rates.) Bubbles can form in Phase 3, Buckland says, as the high-flying stock market ignores the early warning signs of the deteriorating credit market.... (
It is against this backdrop that worries are surfacing among investors. Some bearish hedge fund managers are investing anxiously in credit-default swaps and retreating from high risk. Discounting the distractions and illusions fostered by the monopoly media, serious students see the intractable crisis in Europe, the slowdown of the emerging market economies, the recent setbacks to Abe-nomics in Japan, and the loss of momentum in the economy of the Peoples Republic of China as adding to the contradictions lurking under the surface of the US economy.
Vladimir Kazakevich expressed fears in his 1940 article cited above that “...powerful interests on both sides of the Atlantic are likely to regard a war economy as an immediate solution for the chronic crisis...” Certainly his fears were well grounded. Militarism did prove able to “solve” the contradictions of global depression, at the enormous, unprecedented human cost of World War Two.
One cannot but wonder today if a similar logic is operating in the minds of US and NATO leaders who seem determined to stir hatred and belligerency. The newly emerged ISIS demons seem almost too perfect of a foe --- almost a caricature of evil that may well bring an unprecedented level of US military might back to the Middle East. The “limited” US air campaign has already cost over a billion dollars, a nasty piece of military “pump priming” for the US economy.
And bear-baiting-- poking Russia with threats, sanctions, and military engagement-- is the new obsession of NATO, even at great economic cost to a prostrate Europe. The actions contemplated by militarists would push the risk level back to some of the worst days of the Cold War.
Is it not more and more apparent that only the “specter” of socialism can offer an answer to the chronic global crisis of capitalism and its attendants, xenophobia and war mongering?

Zoltan Zigedy

Friday, August 22, 2014

Democracy Soiled: The Case against the US Ruling Class

Reading the latest Wall Street Journal/NBC News opinion poll is like glimpsing a snapshot of an alien civilization. Surely these are not the opinions of the flag-waving, beer-guzzling US masses depicted on television and by the rest of popular culture. Surely this is not the world view of the self-absorbed, numbed populace, addicted to the NFL and movie weepers.
Are we to believe that nearly two out of three (62%) of those polled are dissatisfied with “America's role in the world”? If most citizens are unhappy with the US government destabilizing Iraq, Libya, Syria, Ukraine, or supporting genocide in Palestine despite unrelenting media lies and government deception, then how do our leaders justify their acts? Why do innumerable and endless wars continue?
Why do almost two-thirds of those polled (64%) express dissatisfaction with the “state of the US economy”? Are they not following stock market euphoria? Are they not listening to pundits who have declared “recovery”? Aren't US citizens paying attention to financial cheerleaders?
Why do three out of four (76%) of the people have no confidence that “life for our children's generation will be better than it has been for us, up from 60% in 2007?
Why the negativism? Why the pessimism? Why do over half (54%) of poll respondents believe that “[t]he widening income gap between the wealthy and everyone else is undermining the idea that every American has the opportunity for a better standard of living”?
How can our fellow citizens hold such bold, radical ideas? How have they escaped the constant beating of the drums of war and the ubiquitous celebration of prosperity and American grandeur?
The answer is really quite simple: they have lost confidence in politicians, the political system, and other key institutions. The WSJ/NBC poll reveals that approval for President Obama has, this month, reached an all-time low of 40%. While this may seem like good news for the Congressional Republicans, it is not. Only 19% of respondents held positive views of the Republican politicians.
Perhaps the most stark demonstration of popular anger is the wholesale rejection of the “political system”: four out of five polled (79%) were dissatisfied with “the political system.
Two things stand out: First, hyper-patriotism, economic confidence, and trust in the widely heralded US democracy is a myth. Second, the US people have far greater dissatisfaction with the course of the country than our leaders and the commentariat would like us to believe.
Clearly, there is a disconnect between the sentiments and desires of the masses and the actions and views of politicians and their media lackeys. In the most basic sense, the US political system does not respect or reflect the popular will. That is just to say it does not function democratically. Paraphrasing the pundits, the US is a failed democracy.
The same undemocratic leadership arrogantly postures as the guarantor of democracy to the rest of the world! The US government audaciously assumes the privilege of telling everyone else how to live! Knowing no shame, US rulers ignore the democratic crisis at home while mounting a crusade to enforce sham democracy abroad-- a bitter irony.
Forcing US “Democracy” upon the World
Nothing exposes the hypocrisy of US rulers like their tragic destruction of Iraq. Driven by a lust to control the fate of all oil reserves in the Middle East and an intolerance of any regime that shows even a spark of defiance to US dictates, successive administrations have invaded, bombed, economically terrorized, invaded a second time, occupied and rekindled ethnic and religious animosities for over two decades---all in the name of fostering democracy. As a result, a once stable state is now what the US media like to call a “failed state.”
Never mind that the US had covertly helped to install the vicious, anti-Communist Saddam Hussein as a puppet ruler of Iraq. Never mind that the US encouraged and aided his brutal regime in a war against Iran. Never mind that despite Saddam's iron grip, Iraqis enjoyed a relatively high standard of living and one of the more secular cultures in the Middle East in a country now often without electricity, insecure, and ridden with ethnic hatred.
Nonetheless, US elites celebrate the gift of democracy to the Iraqi people, dismissing the pain of war and occupation as a price well worth paying (by the Iraqis!).
Yet paradoxically the US government has friends--intimate friends--who are far more in need of a lesson in democracy, friends with even less regard for human rights and democratic practices. Consider the 1989 version of the CIA's World Factbook, hardly a source likely to present the US's foes in a good light or its friends negatively. Compare pre-invasion Iraq to imperialism's best friend on the Arabian Peninsula, Saudi Arabia. Despite the massive losses incurred in the war with Iran, Iraq had a slightly higher life expectancy than did Saudi Arabia in 1989. Literacy was also higher. More to the point, the CIA describes trade unions as “illegal” in Saudi Arabia, and suffrage and elections as “none.” Saddam's brutal Iraq, by contrast, citing the same source, allowed some trade union activity and boasted universal suffrage and National Assembly elections last held four years prior. While Saddam's democracy scorecard was pathetic, surely the feudal-like theocracy of Saudi Arabia was even more deserving of remediation.
Iraq's once regionally stellar economy, measured by GNP per capita, was set back greatly by the Iraq-Iran War and was further devastated dramatically by US intervention and its aftermath, sinking to levels below those of 1950. Is that, and a decline in life expectancy, an acceptable price for US-imposed “democracy”?
We got a taste of the flavor of US-style democracy as we watched the US Administration call for the peaceful overthrow of the constitutionally installed Prime Minister of Iraq. It was no secret that the call for Maliki's retirement or removal from the position was a condition of continued US support. Shamelessly, the Iraqi peoples' will played no role in this extortionate change; the US Administration, not the Iraqis, decided Maliki must go. So Maliki is gone and another puppet is in his place.
While poll after poll demonstrate that most US citizens are tired of endless war, imagine what the Iraqi people feel about constant death and destruction from 1990 until today, unending war and death-dealing sanctions without relent.
The powerful, aggressive ISIS today poses the latest threat to Iraqis, thanks to the US government's meddling in the affairs of her neighbors. Stirring the Syrian opposition and encouraging US allies to support the sectarian-driven insurrection against Assad has provided both the material means and tacit acceptance for ISIS's machinations. Only unmatched hubris and unlimited hypocrisy could so irresponsibly unleash the dogs of war. Now the most militarily effective force in the US crusade against Syria's president has crashed the Administration's party in Iraq, threatening the very existence of a US puppet-state. And, despite desperate bombing by the US military, the only effectively proven counterforce to the brutal ISIS now is the guerillas of the Kurdish Workers Party, a movement that the US and its allies have hysterically labeled “terrorists.” How ironic, how insane, how tragic!
Twenty-first Century Crusades
Extinguishing independence and advancing US capitalism are unquestionably the constant goals of US foreign policy. But since the demise of Soviet power, those policies are advanced by a world-wide crusade under the false banners of democracy and human rights. Like the crusades of old, sanctimony proves to be a good cover for otherwise naked, indefensible aggression, plunder, and intervention. Whether it’s soft intervention (USAID, National Endowment for Democracy, NGOs) or military aggression (the CIA, NATO, US military), US rulers continue to push the limits of popular tolerance of a malignant foreign policy, an effort aided immensely by the lap-dog media.
Most recently, the US and NATO have destroyed Libya as a stable, viable state, interfered in political events in Egypt, and sparked a civil war threatening the future of Syria. The US arms and encourages Israel in its apartheid and genocidal policies while uncritically protecting it from the censure of most of the rest of the world.
In Ukraine, the US has played an irresponsible role-- not unlike its strategic engagement with religious, anti-secular zealots in the Middle East-- by funding, training, and encouraging the most xenophobic, nationalistic, even fascist elements to stage a coup against the elected president. Since the stage-managed replacement of Viktor Yanukovych with one of the country's richest elites, Ukraine is waging a cruel, bloody assault on its dissident Eastern territories. Sickening irony: the US angrily condemns even the most moderate government actions against dissent in Syria, Venezuela, Cuba and a host of other countries perceived as adversaries, yet it finds no cause in the bombardment of innocent civilians in Eastern Ukraine. Where are the human rights organizations? The civilizing NGOs?
No country has been targeted by the US's hypocritical “democracy” and “human rights” crusade as has Cuba. No country has so admirably repulsed that campaign. From assassination attempts to invasion, from raids to biological warfare, from slander to blockade and terror, the Cuban people have successfully guarded their independence and defended their chosen path. The latest exposures only show how desperate US elites are to return Cuba to the Empire. USAID, a government agency masquerading as a nonpartisan promoter of democracy, unleashed two recent covert programs against Cuba. Both programs bordered on the ridiculous: one, a “twitter” like program to seduce Cuban youth into dissent and, the other, a phony health care project to enlist Latin American youth to travel to Cuba pretending to promote health care and HIV prevention while planting seeds of opposition to Cuban socialism. Both programs show how easily deceit and dishonesty mix with US-style “democracy”.
Retire the word?
Once, the word “democracy” had meaning for those living in the US, a connection-- often slender, but a connection-- to the interests and collective will of the majority of people, the masses. No rational person ever thought that democracy was perfect, complete, or absolute. But many drew hope from the promise of democratic rule and democratic institutions. Many celebrated the democratic content of freedom from the bondage of slavery, of universal suffrage, and of the progress of labor. At the very least, the democracy inherited from the colonial revolutionists served the bourgeoisie and its cohorts well and left the the door cracked open for some truly democratic reforms (though the door was slammed shut when the danger of radical democracy arose).
But in the US today, the word is used to deceive, cheat, and oppress. “Democracy” serves to mask an oligarchic regime employing a Gestapo-like surveillance of every citizen. “Democracy” seeks to legitimize a two-party system that produces one-party results. “Democracy” is bought and sold like any other commodity. And “Democracy” is the protector of wealth and power.
Perhaps the D word, like the word “terrorist,” should be retired until sensible people with a principled commitment to popular rule can counter its defamation. Maybe “democracy” should be put on the shelf until a movement truly worthy of the word emerges. Judging by the recent WSL/NBC poll, the people are waiting for it.
Zoltan Zigedy

Wednesday, July 23, 2014

Viva Charlie Haden!

Charlie Haden has died.
The liberals have Bruce Springsteen and Stevie Wonder (You can tell liberal political music because its fuzzy message is always easily expropriated by corporate commercialism and even conservatives.)
But the authentic left had Charlie Haden. A man who defined earnestness, Haden was a key figure in the last wave of innovation in the African American-inspired art form, jazz. Concurrent with political stirrings in the 1960s, a musically radical group of musicians pushed improvisational music to its limits. Liberating times produced liberating music. Charlie Haden was an important part of it.
On the economic side, Haden was a charter member of the Jazz Composers' Orchestra Association, a group dedicated to overturning the greed of club owners and record companies. 
On the political side, he founded the Liberation Music Orchestra, a project paying homage to leftist music, ranging from the Spanish Civil War to the South African Liberation movement. A sampling of the LMO can be found here.
Haden's unassuming manner belied an iron resolve. In 1971, despite warnings, he publicly performed his Song for Che in fascist Portugal, dedicating it to the liberation movements in the Portuguese colonies. Caetano's political police were not amused, detaining him until US officials intervened. A performance of Song for Che can be heard here.
Charlie Haden, paraphrasing Brecht, was essential.
Today, righteously radical music is a rarity in the US. As in the fifties, most musicians strive to make up for their timidity and sameness with audacious names, theatrics and posturing, and juvenile “rebelliousness.” All the more reason to celebrate the few radical artists. The only self-described communist US artist that I know of is the enormously talented and intelligent Boots Riley of the group, The Coup. Listen here, here, here, and here. Other hip hop artists with a radical left lean are Paris, Dead Pres, and Immortal Technique. All forgo civility for truth.
Tom Morello, a brilliant guitarist and often a collaborator with Boots Riley, occupies the political space in rock located some distance left of Springsteen.
And country music has Steve Earle, about as radical as the genre will allow since it hitched itself to hyper-patriotism.
The revered genre of folk remains a friendly form for leftist lyrics. David Rovics counts as perhaps the best new voice with fresh, bold themes. Listen here and here. And Anne Feeney's intense partisanship has earned the deserved title of labor's best musical friend. She can be heard here and here.
Thanks to Carlos Sa, my eyes and ears have been exposed to a treasure trove of interesting international music available on youtube.
There are countless versions of the haunting, poignant Carlos Puebla tribute to Che Guevara, Hasta Siempre. Polish saxophonist, Jan Gabarek, has offered a jazz version for decades. A recent one can be found here.
The Spanish group, Jahmila, has an impassioned interpretation here.
French singer Nathalie Cardone has made a career out of offering an impassioned emotional interpretation of Hasta Siempre in settings ranging from slick studios to elaborately staged videos. In this video, she takes on the role of a French Marianne, clutching a baby to her breast and a Kalashnikov over her shoulders while leading cane cutters and urban poor to the Revolution. A bit over dramatic, but certainly moving in the admiration evoked for the great revolutionary.
Supremely tasteful and elegant while intense and impassioned, Classico Latino offers this unique version of the tribute to Che.
No music has inspired generations like the songs embraced by the Republican cause in the Spanish Civil War. Contemporary versions salute the dedication and sacrifice of the anti-fascist fighters. Mexican American Lila Downs' version captures the determination of the Communist organizers and leaders of the legendary Quinto Regimiento.
An equally impassioned interpretation is available on youtube from the French group Watcha Clan.
Other exciting videos recommended to me by Carlos Sa include:
Camila Morales Millones
Brazilian hip hop activists, O Levante Pretos e Pretas de armas na mão
Spanish Marxist artist, Pablo Hasel Comunista and Apologia al comunismo
Two tributes to martyred Communist agricultural worker, Caterina Eufemia, here and here
Cyril Mokaiesh Communiste
Three videos from the powerful, hard driving Marxist-Leninist rock group Los Monstruitos:
We can say that rebel music-- hard-core revolutionary music-- is alive and well, though little of it is in the English language. We can find hope in the fact that young people in other lands are not afraid to include socialism or Communism in their musical vocabulary, though rarely in the US.
At the same time, revolutionary zeal and romanticism often overwhelm judgment and depth in youth culture. But maybe we are more in need of zeal and romanticism at this historical juncture.
There is no lack of zeal with this elderly Italian priest and his rendition of Bella Caio!
Zoltan Zigedy

Thursday, July 10, 2014

The Shame of Iraq Once More

As the Sunni Jihadists of the Islamic State of Iraq and al-Sham conquer city after city in northern Iraq and as black-clad soldiers from Shiite military muster to repel them, it is tempting to blame the chaos there on ancient religious hatreds. But the strife in Iraq today is less the mystifying product of of primordial grievances than the predictable result of very modern power politics.
The US shouldn't repeat the mistake made two decades ago, when a generation of Western leaders explained away the wars that ripped Yugoslavia apart as the result of primeval ethnic hatreds. Then as now, such resignation is an easy way to avoid hard thinking. Hatreds Bred by Power Politics, Daniel Benjamin (Wall Street Journal, June 28-29, 2014)

Benjamin, a former US State Department coordinator, is right on both counts: politics fundamentally drives the crisis in the Middle East and simplistic, but convenient explanations for the catastrophic events supplant any real analysis.

Apologists in both Parties and the supplicant media want to pass off the blame to the victims of the quagmire that the US and its allies have created in the Middle East. They insist that it is not a malignant foreign policy designed to advance US corporate interests and install puppet governments lurking behind the violence and chaos, but tribal and religious animosities, disdain for “human rights,” and ignorance of “democratic” values that thwart the “civilizing” mission of the US and the EU. Just as US ruling elites evaded the lessons of defeat in Vietnam, their twenty-first century counterparts revive the same chauvinistic, self-serving explanations for the hatred and mass slaughter they perpetrate.

To his credit, Benjamin insists on more nourishing explanations. As an insider and participant in shaping US policy, he knows better; he knows that interests-- economic and politic interests-- play the decisive role in shaping the events now spinning out of control in Iraq. He concedes, regarding “the demons of sectarianism,” that “[a]t key points, the US has even unintentionally abetted them...” [My italics] While this confesses far more than most of the US foreign policy commentariat wants to admit, it falls far short of the truth.

As I argued in a previous article (The Shame of Iraq, ZZ's Blog June 22, 2014), Western nations, especially the US and Israel, have devoted enormous resources and attention towards re-directing a decidedly post-World War II secular trend in the Middle East by courting religious fundamentalism. They have, with some success, quashed secular movements and promoted religious zealotry in its place. It is not difficult to discern their motive: in the calculus of imperialism, encouraging backwardness-- ethnic and religious frictions-- often overwhelms the struggle for economic independence and social justice that usually finds fertile soil in secularism.

That I did not make this point clearly was underscored by several critical comments received. It was not my intention to portray Nasserism, the early Ba'ath Party, the brief leadership in Iran of Mosaddegh, or even the Peoples Democratic Party of Afghanistan as paragons of national sovereignty, unity, or socialism. Nevertheless, they were part of a healthy anti-imperialist, pro-independence movement worldwide, a movement that gathered momentum after World War II. In Central and South America, this trend was associated with leaders like Peron, Goulart, Bosch, Fidel, and Arbenz. While they were not all untarnished exemplars of social progress or even radical democracy, they all sought to eke out an independent path for national development, a path that drew the attention and ire of the US and its allies. Similarly, Nkrumah, Kenyatta, and a host of African leaders joined Nehru and Sukarno in Asia in using the opportunity offered by the Cold War stand-off to escape subservience to Western capitalism. In most cases, the escape was thwarted through assassination, CIA coup, covert corruption, or division. In the Middle East, the primary tool was the fueling of the ever present, but dormant, ethnic or religious sectarianism.

With the demise of the Soviet Union, that opportunity is gone and the road to political and economic independence is far rockier.

In understanding the Iraq debacle, context-- historical context-- is everything, a truth that the former State Department official, Daniel Benjamin, fully understands. Scornful of the patently nonsensical explanations that begin and end with alleged Middle Eastern pathologies, he insists that “The spark behind today's fires sprang from the 1979 Iranian Revolution.” Certainly, the Iranian Revolution is a handy scapegoat for those unwilling to fully expose the critical role of the US in fueling, igniting, and stoking the “fires” burning throughout the Middle East.

Yes, the overthrow of the Shah, both a reliable puppet and guardian of US interests, unleashed a firestorm of fundamentalist zeal. But it is impossible to imagine the religiously fomented revolution without grasping the decades of violent and complete repression of the secular Iranian left, beginning with the US- and UK-instigated coup against the moderate, secular and democratic Prime Minister, Mohammed Mosaddegh, in 1953.

While Benjamin insists that we ask credible questions about the Iraqi catastrophe, he purposely directs us away from credible answers.

Nothing exposes the complete bankruptcy of US policy in the Middle East more dramatically than the widespread “surprise” accompanying the sweeping offensive of ISIS across a huge segment of Iraq. Despite decades of intense scrutiny and the most sophisticated technologies, US security services were caught completely off guard by the speed and success of the offensive. Equally embarrassing and “surprising” was the complete collapse of the US-trained, financed, and armed Iraqi military faced off against ISIS.

But US policy makers were equally “surprised” by the treachery of their fundamentalist surrogates who launched an attack on the US in 2001 after undermining a revolution in Afghanistan.Of course, they were also "surprised" by the chaos in Libya after the US and NATO waged war on Gaddafi, creating destruction, death, and instability. They are “surprised” that their sponsorship of an insurrection against Assad in Syria has drawn mercenary armies bent on creating a fundamentalist Caliphate (ironically, challenging the US puppet government in Iraq). They will be “surprised” when the puppet government in Afghanistan also collapses in the next few years.

At the same time, US rulers, wrapping themselves around the banners of human rights and democracy, readily accept the greatest abusers of human rights and of democracy, countries like Egypt, Saudi Arabia, and Colombia, in their crusades against “terror.”

What does this callousness to peace and stability, this unprecedented hypocrisy, tell us?

Surely, it leaves no doubt that US policy in the Middle East, like its policy toward Cuba, Venezuela, and many other countries, is disconnected from high-minded values. Instead, it is deeply embedded in US interests, not the wholesome interests of the US people, who consistently show their disapproval of US intervention in polls, but the interests of US corporations and their courtesans.

One can only wish that this truth could permeate the nearly impenetrable corporate media filter that denies access to all but inane entertainments and surreal politics.

But that doesn't excuse the quiescence and inaction of the broad US left. Even if most cannot bring themselves to utter the word “imperialism,” they must surely see the pattern of violence and destruction that is the constant companion of US policies. They cannot escape the human toll of unrelenting, perpetual war since the phony “war on terror” was birthed. They cannot ignore the contradiction of massive resources devoted to destruction and domination while infrastructure, services, and welfare starve for funding in the US.

The only plausible explanation for this ubiquitous meekness in confronting imperialism is a groveling subservience to the electoral fortunes of the Democratic Party. I say “groveling” because no other word could capture an allegiance that only stiffens in the face of a Democratic Party leadership that is completely contemptuous of the Party's “left” and even more contemptuous of the left in general.

If the Democratic Administration that enjoyed a rousing mandate from US voters, inherited a congressional majority, and spoke of urgent change, fails to deliver a cessation of aggression, then there is little prospect for it doing so in the future. Therefore, remaining mute in the face of the murderous Iraqi debacle, not voicing an objection to US engagement is tantamount to groveling before morally corrupt Democratic Party elected officials.
Certainly some have spoken up, organized, demonstrated, but too few to challenge the media fire wall. We need more to join with UNAC or the ANSWER coalition into assembling local actions. Or for those whose ideological purity is threatened by rubbing elbows with different shades of the radical left, organize your own rally. But public renunciation of the march of imperialism cannot be set aside for electoral opportunism.

Zoltan Zigedy

Sunday, June 22, 2014

The Shame of Iraq

The close of the Second World War saw the rise of Arab nationalism, a movement that promised to unite much of the Middle East around independence and social advancement. The imposition of a Jewish theocratic state in the midst of Arab homelands no doubt accelerated this movement, as did later imperialist meddling such as the Suez intervention of 1956.
Both Nasserism and the Ba'ath Party were early vehicles of a growing nationalism centered on an Arab identity. Nasser's engagement with non-alignment in the Cold War, his secularism, his advocacy of land reform and Egyptian socialism resonated with the Arab masses. Similarly, the pan-Arab Ba'ath Party organized around unity, independence, and socialism-- all with a decidedly secular tone. Islam, rather than the basis for identity, was second to ethic national identities that proudly offered Islam to the world as a gift from the Middle Eastern peoples. This secular trend grew rapidly, resulting in a unified United Arab Republic in 1958, a development that was soon terminated by a coup in Syria.
Of course there were counter trends, reactionary trends in the Arab world that worked against the progressive, secular movement. Centered on the oil-driven dynasties, these forces, frightened by Arab nationalism, aligned themselves with the imperialists, and were vigorously anti-socialist. They offered an ideology counter posing rigid Islamic fundamentalism to secular nationalism. Of course their Western partners shared their hostility and were eager to exploit their influence and resources against Arab nationalism.
The opportunities were forthcoming with the humiliating defeats of Arab military power by the Israeli armed forces. Tarnished by these defeats, afflicted with corruption, and covertly impaired by Western and Israeli security services, the leaders of Arab nationalism began to lose support among the Arab masses.
Israel and its Western imperialist friends contrived a strategy of encouraging fundamentalism and religious sectarianism as an alternative to the Middle Eastern Enlightenment. Once the lightening rod for Arab unity and secular progressivism, the Palestinian Liberation Organization fell victim to this strategy when the Israelis disparaged the leadership of Yasir Arafat, rebuffing his concessions and mocking his weaknesses. At the same time, they sought to vitalize the influence of the religious-based Hamas among Palestinians. This strategy, like so many similar strategies, backfired when Hamas launched the Intifada that struck back effectively against the Israeli occupiers. Envisioned as a classic divide-and-conquer maneuver, the courtship of Islamic fundamentalism underestimated the deeply ingrained hostility to imperial intrigue. It was one thing to undermine Arab unity and secularism, but quite another to scorn Arab independence.
The US embraced the same tactics in its support for Islamic fundamentalism in Afghanistan. As an answer to the assumption of power by a secular, anti-imperialist, socialist movement and its support by the Soviet Union, the US, along with its Gulf allies, raised, armed, and assisted a merciless, sectarian fundamentalist insurgency openly contemptuous of the human rights that the West pretends to cherish.
The backfire-- or “blowback” as some have dubbed it-- came quickly and often, culminating in the deadly coordinated attack on the World Trade Center and the Pentagon in September of 2001. Thousands of innocent civilians in the US died because US policy makers, through ignorance and irresponsibility, sponsored religious zealots against the tide of democratic, secular, and progressive movements in the Middle East. While the tactic succeeded in turning back the tide of secularism in the Middle East, the tacticians failed to understand that their erstwhile Islamist allies deplored imperial manipulation as much as they hated secularism. In other words, they weren't the dupes that their “masters” wanted them to be. As the divide-and-conquer strategy collapsed, generating anti-Western violence, the Western puppeteers could only react in panic: “Terrorists!” The liberal apologists for this dangerous game offered their own term of derogation: “Islamo-fascists!”
And nothing was learned from the unholy alliance.
Once again, policy makers thought they could ride the tiger of religious sectarian intolerance and create a loyal satrapy to US interests. The US fabricated outlandish excuses to invade Iraq in 2003, though not so outlandish as to nonetheless seduce nearly the entire US intelligentsia, as Frank Rich recently recounted in a nastily angry, bitter article in New York magazine (The Stink of Baghdad, June 2-8, 2014). Rich reminds us of the hysterical reaction to absurd claims about the dangers supposedly latent in the regime of Saddam Hussein.
Cobbled together by League of Nations mandate, the British had established the country as a semi-colonial kingdom that lasted until its independence in 1958. Its brief life as a republic was afflicted with internal ethnic, religious, and political divisions. Through brutal repression of these many divisions, Hussein was able to establish a reasonably stable country, a country to be counted as one of the most outwardly secular in the Middle East at the time of the US's unprovoked massive invasion.
With the senseless slaughter of hundreds of thousands of Iraqis, the shearing of a fragile social fabric, and the wholesale destruction of the country's infrastructure, the US invaders and their compliant allies succeeded in sowing chaos and instability never before seen in a land once celebrated as the cradle of civilization. Quite an accomplishment for the twenty-first century super power heralding itself as the paragon of democracy and human rights!
The vandals could not leave without creating a mock democracy to accompany a massive military and security apparatus constructed to hold the bloody mess together. In 2006, the US vetted potential leaders and permitted the Iraqi parliament to “choose” the hand-picked prime minister, Nouri al-Maliki. In the last week, President Obama now wants to fire him; rather, he wants the parliament to fire him and select another hand-picked prime minister. This process passes for democracy, with the scribes populating the major media in the US.
In the last month, the massive military/security apparatus has crumbled in the face of a well coordinated offensive by a ruthless, dedicated band of zealots seemingly more welcome in some parts of Iraq than the former invaders. The only thing that the warring factions in a once stable country can agree upon is their animosity towards those who pretended to liberate them from the Saddam Hussein regime.
It is a supreme-- but cruel-- irony that a country with a tenuous hold on nationhood, a country still barely beyond the legacy of colonialism, a country enjoying a rare period of secular culture and stability, was pushed back into barbarism and destructive sectarianism by a supposedly enlightened, advanced country flexing its muscles under the absurd banner of a “War on Terror.”
There is not a Hall of Shame large enough to accommodate the talk-show propagandists, witless syndicated columnists, and mindless news anchors who cheer-leaded the Iraqi debacle; but surely Thomas Friedman, the New York Times columnist, deserves a seat near the front row. His enthusiasm and repeated mistaken projections of final victory are well documented. One of his most recent columns tells us that our attention should shift from the bloody confrontation currently bringing death and displacement to Iraq to the conflict of “the extremists vs. the environmentalists in the Middle East” (The Real War of Ideas, NYT, 6-10-14). Demonstrating his ignorance again and again, he announces that he has uncovered the environmentalists' secret: “The environmentalists think of this region [the Middle East] without borders...” He seems to overlook the important fact that all of the existing borders are largely irrational products of colonial governance, borders designed to exploit tribal and religious animosities to the benefit of colonial masters. For Friedman, history and context are nothing weighed against his latest conversation in a whirlwind tour of a region.
For another journalistic scoundrel deeply implicated in the Iraq debacle, we can turn to John Burns. In the words of Michael Munk: “As chief of the NYTimes Baghdad bureau during much of the war, [John] Burns was a notorious cheerleader for the invasion and occupation. He now blames his failure to understand how 'deeply fractured' Iraqi society was. I guess you failed to notice, John, that it wasn’t fractured before the invasion, and as Naureckas observers, 'Is it typical for countries to respond to unprovoked military invasions by becoming strong, stable democracies?'”
Burns, without a hint of contrition, now says: “I think the mistake we made was–I'm talking here about myself as well as some of my colleagues, not just at the New York Times but many publications–was not to understand how deeply fractured that society was, how strongly held those animosities were, and how they would not likely relent under any amount of American tutelage and encouragement.” (quoted by Naureckas above)
This is exactly the wrong conclusion to draw, a conclusion exposing both dishonesty and servility to US government policy. Iraq was not, as Munk reminds us, a fractured society until the US fractured it.
Moreover, Libya was not a fractured society, nor was Syria a fractured society, until the US joined with others in fracturing them. It was no coincidence that, like Iraq, both were among the most secular countries in the Middle East with relatively high standards of living, high educational levels, and developed social safety nets. Today, Libya is largely ungoverned and ungovernable, a failed state. And Syria is in the throes of an ugly civil war stoked by the US, EU, and the Gulf states.
Put simply and clearly, Iraq is not an honest mistake, as Burns would have it, but an instance of a systematic, aggressive foreign policy designed to divide and conquer the Middle East, a policy designed to use religious fundamentalism and tribalism, formerly on the wane, as an instrument against independence, nationalism, and social progress. It is the foreign policy of imperialism.
It is not only the policy of Bush, as Democratic Party stalwarts want us to believe. It is not only the incompetence of Obama, as the Right shouts. It is not the over-reach of super patriots or chicken hawks. It is not only an arrogant, unrestrained military, as many pretend. It is the willful, unwavering program of a US ruling class determined to shape the Middle East to meet the interests of elites and corporations in the US and with its allies.
The failure to face this truth guarantees that the Iraqi debacle and many more like it will bring shame to the self-styled democracies and the hypocritical bastions of human rights.
Zoltan Zigedy