By Juan Cole | (Informed Comment) | – –
The last time capitalism faced a crisis this deep, it was 1929. People minded the Great Depression. All those people Joe McCarthy persecuted in the 1950s for having joined the Communist Party when they were young and angry had been angry because of the Great Depression. Specifically, they were angry at capitalists, especially bankers, whom they blamed for kicking millions out of their homes or off their land. Bank robbers even became celebrities. Semi-socialist policies like social security were implemented by FDR in part out of fear of popular anger.
It wasn’t Donald Trump or alt-NeoNazi Steve Bannon who was mainly responsible for taking the US back out of the Paris climate accord.
It was the Koch Brothers and the rest of Big Oil, and Big Gas, and Big Coal.
It was “energy” corporations who have vast inventories of worthless fossil fuels that they want to unload on the marks quick before everybody realizes they have all the usefulness for human beings of eating arsenic.
There are some well run companies in the world that improve people’s lives. But if corporate American is willing to alternately cook and drown our grandchildren to make a quick buck today, then they are our enemies. They are monsters. Period.
The compact we had with the corporations had already been reneged on long ago. They were supposed to make and distribute goods efficiently and provide an ever better standard of living to American workers.
But the real value of the average wage of a worker hasn’t increased since 1970.
The cost of a college education for a middle class family has skyrocketed, making it harder for families to get ahead. Graduates go out into the world with $150k debt.
Inequality is spiking. The opportunity for young people to rise beyond their social class has declined dramatically in US. America is no longer the land of opportunity.
So the compact between the public and the corporations was already in trouble. Workers still have not recovered from the 2008-9 crash.
The glib and deeply dishonest attempt of Big Carbon to represent the repudiation of the Paris accords as a victory for American workers will quickly be seen through. Factory jobs in the US have declined, but not because of environmental regulation. The big factor has been robotification. Coal jobs are not coming back.
The American public has shown itself incredibly patient as they watched a handful of corporations simply buy congressmen and senators and have them vote for the interests of the super-rich and against the interests of Americans.
But to have the corporations sell our children and grandchildren down the river for an extra few years of fossil fuel profits, surely that will not pass unnoticed. Maybe it will require a wake-up call. Likely sometime in the next few decades a really big glacier is going to plop into the ocean, immediately raising sea levels. It will be like the 2004 tsunami that killed nearly 300,000 people. But it will be worse because the water levels won’t go back down afterwards, leaving houses along the coast flooded.
And then I am really afraid of severe social conflict breaking out. People are going to be really angry. Rex Tillerson and Tom Pruitt will be long since retired or perhaps even no longer with us. But the corporate offices will be there, visible in the cities.
Right now, if I proposed that in order to combat climate change the US government needs to simply nationalize the country’s electrical grid and redo it with public funds, the snarky minions of the billionaires would just sneer at me. But after the glacier tsunami my idea will look perfectly reasonable and people will wonder why they hadn’t already done that. (They have, in some countries).
Casino capitalism has had a good run, especially since 1980. Its days are now numbered for reasons its captains could never have foreseen. The weather report is the specter haunting them, not the communist manifesto.
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Related video:
Vice News: “Trump Got Climate Change Pretty Wrong in His Paris Speech (HBO)”
Dear Professor Cole
Friedrich Engels must be smiling down on you from whatever quarter of the afterlife he inhabits and nodding at your rediscovery of the validity of his observations
Engels in his 1892 preface to “The Condition of the Working Class in England” said:
But while England has thus outgrown the juvenile state of capitalist exploitation described by me, other countries have only just attained it. France, Germany and especially America, are the formidable competitors who, at this moment – as foreseen by me in 1844 – are more and more breaking up England’s industrial monopoly. Their manufactures are young as compared with those of England, but increasing at a far more rapid rate than the latter; and, curious enough, they have at this moment arrived at about the same phase of development as English manufacture in 1844. With regard to America, the parallel is indeed most striking. True, the external surroundings in which the working class is placed in America are very different, but the same economical laws are at work, and the results, if not identical in every respect, must still be of the same order. Hence we find in America the same struggles for a shorter working-day, for a legal limitation of the working-time, especially of women and children in factories; we find the truck-system in full blossom, and the cottage-system, in rural districts, made use of by the ‘bosses’ as a means of domination over the workers…
You omit the need for a Teddy Roosevelt to bring the US back into the Progressive Era, break up corporate monopolies, restore the conservation movement, and try and retain vestiges of American influence around the world. Roosevelt won the Nobel Peace Prize in 1906 for brokering the end of the Russo-Japanese War.
Some of his quotations are worth rereading
On being American: “Much has been given us, and much will rightfully be expected from us. We have duties to others and duties to ourselves; and we can shirk neither. We have become a great nation, forced by the fact of its greatness into relations with the other nations of the earth, and we must behave as be seen as a people with such responsibilities.”
On corporations: “Our aim is not to do away with corporations; on the contrary, these big aggregations are an inevitable development of modern industrialism. … We are not hostile to them; we are merely determined that they shall be so handled as to subserve the public good. We draw the line against misconduct, not against wealth.”
On virtue: “No nation deserves to exist if it permits itself to lose the stern and virile virtues; and this without regard to whether the loss is due to the growth of a heartless and all-absorbing commercialism, to prolonged indulgence in luxury and soft, effortless ease, or to the deification of a warped and twisted sentimentality.”
Perhaps the saddest is “It is of little use for us to pay lip-loyalty to the mighty men of the past unless we sincerely endeavor to apply to the problems of the present precisely the qualities which in other crises enabled the men of that day to meet those crises.”
Sadly there is no-one on the horizon in the US with his vision and capabilities so it is down to we Europeans to cope with mess.
Perhaps in 50 years time a new Shelley will write after a tour round the ruins of Washington “Two vast and trunkless legs of stone
Stand in the desert. . . . Near them, on the sand,
Half sunk a shattered visage lies, whose frown,
And wrinkled lip, and sneer of cold command,
Tell that its sculptor well those passions read
Which yet survive, stamped on these lifeless things,
The hand that mocked them, and the heart that fed;
And on the pedestal, these words appear:
My name is Ozymandias, King of Kings;
Look on my Works, ye Mighty, and despair!
Nothing beside remains. Round the decay
Of that colossal Wreck, boundless and bare
The lone and level sands stretch far away.”
In both the relatively democratic lands and the absolutely authoritarian states, the rot comes from the top.
It is the so-called “political and economic leaders” of all nations that refuse to modify the fossil fuel economy that, we fear, will literally kill our grandchildren, and our hopes and dreams of techno progress and increased social liberties.
When people begin to understand how our everyday choices do create our psychological and philosophical “environments,” which in turn dictate our political and economic “choices,” there might be some room for intelligent people to get organized and actually create government structures that work for the survival and prosperity of all people & all nations.
Obviously we’re a long way away, and we have to create an immense change in a very short historical/geological time frame, 10 or 20 years or so..
Thanks for this insightful piece Juan. I’ve long said to friends and students that our climate scenario is like the medical profession: when my father was dying his nephrologist would prescribe one thing, the cardiologist another – the two, despite my pleas and questions, would not communicate with each other and were sometimes prescribing treatments mutually at odds. All of this is a long-winded way of noting that perhaps the climate people should start to talk to historians and communicate these larger, more dire outcomes to the public.
It won’t be climate change that directly gets us, but its results. It will be a new pathogen that mutates in the right conditions that we can’t stop. Or it will be a small-scale nuclear war between India and Pakistan over water as snow continues to vanish in the Himalayas. Or, most likely, something utterly unforeseeable that has not yet been gamed out – my guess is it may be a drip drip drip of events that act as stressors, such as what happened at the end of the Bronze Age where drought contributed to collapse of Near Eastern and Aegean civilization. Local wars, political unrest, refugee crises – these are already with us and in all probability will only grow increasingly acute.
Economic texts say that capitalism must be amoral: Buyers and sellers, workers and employers, borrowers and lenders must all act in a mechanistic dance of “self-interest” with no thought of an external set of values. All peoples shall bow down and worship the invisible hand.
Reality tells us that amorality soon becomes immorality as the more powerful in all these transactions take increasing advantage. It must feel awfully good to impose their will, regardless of the costs to others, until they become an entire economic class of Rollo Tommasi’s.
The Social Darwinist would say that societies are the enforced conformity of survival strategies, and the society that most fully exploits all possible human motivations to produce goods will come out on top. But why shouldn’t that include the worst motivations? Hate, fear, the hunger to dominate and torture the weak. There is a demand for all those things, and the market will supply every demand.
And that’s why the producers cannot remain merely amoral.
You and Nel, below, alude to antiquated economic thinking, whose inadequacies constitute an important part of our problem.
Nakedcapitalism.com offers many excellent and well-informed critiques of breaking events, often from a fairly technical economic perspective. It is influential, illuminating, and worth following.
Apart from valuable debunking, well informed econic thinking is worthwhile for purposes of anticipation. I’m very much looking forward to hearing what the economic upshot of all this might be.
“Graduates go out into the world with $150k debt.”, that’s is peanuts professor: If you divide the cost of the Iraq and Afghanistan wards ( $ 2 Tr, – 2 plus 12 zeroes-) by the number of people in the USA ( 500,000) every person in the USA would have 4 million dollars!
Sorry I goofed with the numbers. It was not intentional. However if we continue with the wars and inflation we may eventually arrive to the 4 million per person mark.
Graduates go out into the world with $150k debt
A dentist told me that current dental graduates commonly have debts of around a half million dollars.
@katalin_pota 😁🙏
The ramifications of this move are enormous. Apart from the environment, and what it means for capitalism that go even deeper than you mention, is its impact on the world order.
Iraq 2003 was a colossal mistake, but ultimately short term and theoretically something that could be recovered from. Here we’d have to go back to America’s repudiation of the league of nations for a worse move. No, its worse.
How about abdication of the US role in the world, with all its flaws, to the tender mercies of China?
How about not having the underlying economic strenght to pull out of the next depression, which is coming.
Years ago, some writers dubbed fossil fuels “energy slaves”, because the transition of the world from slavery and serfdom to coal-fueled industrialization was so short that you could say that economic growth has always been impossible without “someone” to do the dirty work. A cartload of coal possessed the energy to do the work of many men. It had the side effect of making the North vastly more productive than those who knew they could only defend slavery by forcibly keeping it America’s dominant socioeconomic order.
In a sense, the neo-Confederate gropings of the American Right fit right in with this. The South has always been backwards. That’s an awful thing to say, but it was founded by investors to produce plantation crops without regard as to whether the land could support the needs of the workers. That implied coercion and poverty, and the manufacture of a social order to justify it.
What if that order and nostalgia for it have simply been co-opted by a current oligarchy that relies on all the myriad effects of fossil fuels, because they are now in the same existential crisis as the old slave oligarchy? I remember how in the ’80s the KKK fled law enforcement in the South for the Far West, followed in the ’90s by the Southern evangelists flush with cash from right-wing followers. The South and West have now ideologically merged, with Texas as their axis. It’s merged around the idea of enforcing an “American Way of Life” at all costs. But to the desperate people who seceded in 1860, slavery was the American Way of Life.
The problem is, the young vigorous America could generate a new oligarchy of industrialists who, however reluctantly, could convert coal power into the war budget of the Union Army. More importantly, they had already converted coal power into optimism, a belief that America could abandon the slave-powered past because better was clearly coming. And only in the South was that belief based on simply doubling down on the past. The Northern economy was attempting revolutionary innovations in production, distribution and marketing.
We don’t have that in America now. Too many people (White and old) are convinced the old ways can be magically made competitive, because 40 years ago the old oligarchs went to the GOP and extremists further Right, and said, “Maximize my profits, destroy my expenses, manipulate the public however necessary to make them embrace it forever.” Their money and indoctrination made it possible to brainwash from coast to (almost) coast, whereas the slaveowners had only the means to brainwash their immediate surroundings.
America does not get to be a lead player in two consecutive global economic revolutions. We’ve gotten too senile and obsessed with chasing paper wealth, as was the fate of empires past. That means, this time the economic revolution is tainted by foreignness, and it is easy for the reactionaries to keep Americans at least limited in their enthusiasm for what should be in their rational self-interest. But then, it would have taken a lot of optimism for White Southerners of 1860 to gamble that they would be better off without slaves, and under the leadership of alien Yankees.
So if it feels a little more every day like we’re headed to a second Civil War, it’s not just politics, it’s thermodynamics.
Trump’s back turned on the Paris Accords seems to have stirred a global anti-Trump consensus. The practical potential for such consensus was already with us but until now if has lacked a focus. It is always easier to get disparate groups to unite against rather than for an issue, a phenomenon vividly illustrated by Egyptian unity against Mubarak where his departure having been celebrated with wild enthusiasm and lacking any follow through has led full circle to where it all began. However, this is profoundly different since while there is unity in opposing Trumpism there is also purpose in the Paris Accords. I have a fragile hunch it may it may still turn out for the best.
Most people know that if you wish to keep something in your possession for a long time, and wish for it to perform well, you must maintain and take care of it. Like a car, you should do preventative maintenance. Not only would you do as the owners manual instructs you to do, you would be careful while driving it, like missing pot holes and the like. In other words you respect the idea, that for you to continue to enjoy and rely on this vehicle for it’s longevity you must maintain your vehicle in order to continue to keep it running well. Okay then why not take care of Mother Earth?
It doesn’t require a whole lot of education to understand how to continue to enjoy what this planet produces, that you can’t continue to abuse the air, land, and oceans, as we now do.
Consider how many of us purchase and drink bottled water. Doesn’t this seem odd? Will we soon be wearing oxygen tanks, and will designers strive to come with stylish tanks at that? What will replace soil? If the Koch Brothers develop a replacement for soil, then how much money that we don’t have will it cost us?
Like anything you highly value you take care of it, so why are we so careless with our earth? It’s not like we can just go out and buy another earth. In short, we humans are so use to having a green earth we take it all for granted. So now is the time we all wake up to this fact, and quit claiming every warning to save our planet, is just another left wing hoax.
For now we ignore the warnings, but in the future good earth maintenance will become the law of the land. Sorry Libertarians.
what is needed is more public awareness to the climatic problem. Apparently all advertising done is in order to consume more fossil fuels. Big pick up trucks, big engine cars, more windows at new homes; all in order to increase your carbon print. What is needed is less not more utilization of fossil fuels. The problem is all of us, not only the governments.
In Mexico city, its Congress bought several toyota prius for its members in order to consume less fuel and help with its terrible contamination. They are not used because the congressmen want to be driven back and forth to work in suburbans. That does not help at all. And watching t.v. you never see an hybrid car around the U S Congress but only big cars, suburbans, and painted black
A lot of good comments here. Herbert Hoover, of all people, said that the problem with capitalism is that capitalists are too damn greedy. As another pointed out, this is the natural evolution of capitalism. Greed leads to monopoly and encourages participants to not play by the rules in order to get a competitive advantage. There is no “invisible hand” in the marketplace and the markets cannot be amoral because of individual greed. Also, decisions are not always rational in the marketplace. Thus, the main underpinnings of the capitalist system are doomed to failure without government intervention. FDR, when greeted with howls from the capitalists over regulations and government programs, observed that he was their best friend because he was saving capitalism from itself. The New Deal economy worked well. It was done in because the US Chamber of Commerce, in the early 70’s set about destroying it (the Powell memo, see link to billmoyers.com)
It’s not the end of the American empire, but you can see it from here.
The American public has shown itself incredibly patient as they watched a handful of corporations simply buy congressmen and senators and have them vote for the interests of the super-rich and against the interests of Americans.
I’m not sure “patient” is the right word to describe the American people in this instance.
Every time low income workers demand a small increase like $12- $15 businesses in including big corporations and GOP politicians start freaking out saying that they will not hire or businesses will shut down yet the money that these workers are paid is not even enough to afford own apartment without sharing with other workers. There was a time when it was a taboo for so many people to live in one apartment, but now even 4 workers in a two bedroom apartment is not uncommon because no one can afford an apartment on their own with $9/hr and schedules that change from 20 to 35 hrs a week. Someone bought a 3 bedroom house opposite where I live and there are 5 people who rent the place and 6 cars tightly packed on the long driveway. Not one car is parked on the driveway during day working hours.
Is global warming an existential threat to the very rich? I think that they can avoid the discomforts and find profitable ventures regardless of the hardships and devastation that will be born by those who don’t have the wherewithal to cope. The rich will always find and control that temperate and fruitful archipelago, wherever it happens to be .
But they will need pervasive security and surveillance to protect them from the rabble. All this is now within reach. We already have the surveillance state, and the police are gradually becoming militarized. I think this is Donald Trump’s vision. His attacks on free speech and the news media are essential to suppress ground up democracy. A few good tax cuts for the rich, especially dropping the inheritance tax, and some non-judicious court appointments, will help solidify the oligarchy he envisions.
It’s human nature to not really give a damn about other peoples hardships that have no affect on ones self. we’ve shopped vigorously through fifteen years of war, turmoil, death and destruction in the Middle East. Why expect the oligarchs to sweat coastal flooding, droughts, and monster weather events?
It will fail
Sorry, Juan Cole, but there is no handy big glacier to plop in the ocean. Just the steady melt of the Greenland Ice Sheet, to be joined later by the West Antarctic Ice Sheet.
Hi, David. The ice sheets are already in the water and their melting won’t raise sea levels. They are however acting as barriers keeping some very large glaciers in place. Once the ice sheets plop in, the glaciers will be next. One of them is estimated to be able all by itself to raise the sea level 10 feet. The glaciers will go in. The question is only on what time schedule. But you ae right that the ice shelves will be first. Read all the way down here:
link to theguardian.com
Wall Street and the US FED must bear much of the responsibility for this ongoing disaster.
Zero interest rates on your savings, drive people to invest in the stock market, that is being fueled by money printed by the FED – allowing the corporations to borrow money at nearly 0% to buy back their own shares, thus driving the share prices ever higher.
When the black swan event, that “no one saw coming” happens, the small shareholder will get screwed once again.
Maybe then they will reach for the pitchforks and we’ll see bankers hanging from lamp posts – and not before time…