I should start by saying I am indebted to a couple of things I read recently for the brain-storms behind this post: Thomas Piketty’s Capital in the 21st century, and the Wall Street Journal of Monday, November 14, 2016.
So… “Make America great again”. Let’s dig into that for a minute. What does it mean? Sure, to many it means a return to a world in which straight, white, cis-gendered, gentile men ruled over us all and didn’t have to worry about anyone successfully elbowing in on their hoarded stores of power, money, respect, freedom, and basic physical security. Maybe some of those people would like to re-live the thrill of the rest of us stepping off the sidewalk, curtsying, and hiding in the shadows in shame. But there is more to that time, that time that is so great in the collective memory of these former masters of the universe. In fact, there were some things in that time- the middle of the 20th century- that did hold a promise of greatness, if yet to be fully realized in equitable distribution, particularly to non-white people. Specifically, as Thomas Piketty shows, it was the only time in history that wealth has been re-distributed from the top percentiles of earned income and more importantly from the greatest inherited fortunes, to a middle 40%- the much touted great American Middle Class, which has been in decline since roughly 1980. During that great time in the mid 20th century, Private Capital, through unprecedented high post-war tax rates on the top decile that has always held a great majority of the wealth of all nations, became Public Capital in the form of subsidies and support- the G.I Bill and all of it’s provisions being an important example- in Social Security, Medicare, a well-funded public education system that was affordable to all, through the University level, a well-funded and powerfully unionized Public Sector from Teachers to The Postal Service, to Public Utilities, and on and on. The Quality of life and broad prosperity of that era were due almost entirely to the transference, through taxes, of Private Capital into Public Capital. During this same era, and again, in large part due to government aid as part of the G.I Bill, a significant number of American families were able to build equity through home-ownership.
The middle class in America lost a huge part of the equity that differentiated it from the bottom 50% (those with no equity, no capital, nothing they can pass on to their heirs) in the subprime mortgage/foreclosure crisis of 2008. A massive amount of housing stock at that time became bank-owned and was then auctioned off to already-wealthy venture capitalists, leading to a boom in the rental-market for these re-couped single-family homes. Many Americans now are not even given the option of owning a home, even a fixer-upper in an undesirable neighborhood. They must rent, and the main difference between renting and home ownership is that through home ownership one can build equity and potentially have something of value to pass on to one’s heirs, improving the lot of the next generations, if not ones own. In the rental scenario, one is forced to pay and pay to a (increasingly likely to be corporate) landlord just to stay housed, while building no equity, and probably not saving anything for future generations.
The loss of equity in home ownership left the middle 40% (and even the bottom 50%) with one precious resource. Increasingly the only thing we, the bottom 90%, own. Though we own it collectively, and not individually, we do own it. We paid for it, and continue to pay for it, together. That is our “Public Capital”- Social Security is our collective savings account for retirement. Medicare is our collective safety net for our medical needs in our old age. Our Public Education system is a collective investment in the care and education of our children. When we look at our paystubs and see certain dollar amounts accruing to these programs, we have a level of confidence in that investment. We are okay with handing over that money, because we feel confident that we are going to see that money again, that it will be properly safeguarded, will accrue a little interest, and will do us a world of good someday when we really need it. Enter the Republican Congress intent on “privatizing” Medicare, Social Security, The U.S Postal Service, our Public Education system, etcetera etcetera. The argument, as far as I can gather, is that the private sector will far more efficiently manage our money. If we turn the huge well of taxpayer money in Medicare and Social Security over to portfolio managers on Wall Street, they will most certainly maximize returns in morally defensible ways, and we will all benefit. Never mind the bailout they so recently required for their recklessness. Never mind the 401Ks so recently reduced to crumbs by their shitty greed and life-lived-in-blinders-made-of-money. Supposedly the Postal Service will benefit from privatization. Really though, The idea seems to be a brilliant way to (As with the privatization of public schools and elimination of the Teacher’s Union) phase out one of the last good forms of public-sector employment, one that offers job-security, good pay and benefits, and enable the replacement of employees one is obliged to take care of with temporary workers to whom one has no such obligations. I’m sure it is an added enticement that privatization of the Postal Service can happen simultaneously with the selling off of Post Offices themselves, since they are public property- one piece of the physical infrastructure that is part of our “Public Capital”- the things that all the people, including you and I, own. Our Prison system has already been largely privatized, which has led only to an impetus to grow the prison population through racist policing practices, to keep that federal money flowing into the pockets of investors and the private prison industry. Our State-funded mental hospitals were privatized by Ronald Reagan, and the result is that we have a huge and ever-growing population of homeless individuals with untreated severe mental illnesses on America’s streets. Our Public Universities have been largely privatized, and the result is annual tuition hikes that make higher education a giant debt-trap for anyone whose parents can’t fully foot the bill, if they’re even able to get there at all.
All of this push to privatization means a fire-sale of public capital- all we, the people, have left of the middle-class equity built in the mid-20th century, to the highest private sector bidders. In other words, to the people who already own everything else. We will continue to need these services (or at least to want them. I guess we’ll find out how much we need them when we no longer have access to them), but from the moment they’re privatized there will always be a middle man taking as large a cut as he can get away with. There will always be some asshole on Wall Street playing with a chunk of your paycheck and my paycheck, and maybe giving some of it back to us down the line. Or maybe not. It depends on how he’s feeling.
The collective contributions of the good, dutiful, obedient American taxpayer add up to a huge pot of money. After all, there’s a lot of us. It is infuriating to those who want to play with this money (and are used to getting what they want) that we’ve managed to keep their hands off it for so long. If they do get their hands on it, what will they do with it? An article in the Wall Street Journal on The Alaska Permanent Fund, which manages Alaskan Oil Revenue, gives us a clue. As global oil prices have plummeted, Alaska’s oil revenue has declined 80% over the past 2 years, but the fund made a lucky bet four years ago when it put major funding behind a company (now publicly traded), called American Homes 4 Rent. This company is one of those (mentioned above) that swooped in after the 2008 crash and scooped up huge numbers of foreclosed homes at bank auction. It is now permanently operating as a corporate landlord for single-family homes that, if on the market for purchase, would have been an opportunity for working americans to build equity through home-ownership. The headline for the article is “Alaska’s bet on Housing Bust Pays Off”. My point is, an increase in risky mortgage swap-type financial instruments are the almost inevitable outcome of a de-regulated financial industry (virtually guaranteed under a Trump presidency), and we should have learned our lesson from 2008: investments of this kind, as profitable as they may be in the short term, are risks that cannot be taken with people’s retirement and healthcare savings. Particularly since risky financial instruments are certain to be damaging working Americans in myriad other ways, as the foreclosure crisis shows. Privatization of our public capital and de-regulation of the financial sector, taken together, can only lead to utter ruin for millions of people.
Which leads me to my conclusion. I am fucking pissed. I am fed up to here. I thought I had reached a zenith of fury during the Bush/Cheney war profiteering years, when it was completely clear to me, and I believe, to most Americans, that these guys had illegally invaded and destroyed a country halfway around the world so that they could pillage that country’s oil reserves (Geneva Conventions be damned) and award massive government contracts (read: TAXPAYER’S MONEY- OUR MONEY) to their buddies, or in the case of Halliburton, to themselves, to “rebuild”(not very well) the country they had illegally destroyed. The Iraqi people and all the U.S Military and civilian personnel, including relatives and friends of mine, who were and continue to be traumatized, injured or killed in Iraq, are collateral damage in a massive transfer of wealth from the bottom 90% of American people to the top 10%- mostly to the top 1%. I remember thinking at the time “god-damn them, they really will not rest until they get it all”, because the scheme was so transparent. I had already considered going off-grid to avoid paying federal taxes at that point, due to my deep discomfort with war profiteering and my natural resistance as a being with a modicum of self-respect and some healthy moral fibre to the idea that a chunk of my hard-earned and meager paycheck was going into the pockets of the slimy greedy pigfuckers at the top by way of foreign plunder, rape, and murder. I just couldn’t figure out, logistically, how to do it. But if they pull off this privatization crap, I have to figure out how to do it. WE have to figure out how to choke off their money at the source. As long as we all sit down every April and obediently send our few coins down the chute into the pool of grease and blood and deep dark shadows, they will not give a flying fuck that we’re protesting every night. They will wipe their satanic buttholes with all of our petitions demanding equal rights and respect and dignity and an end to wars for plunder and “regime change”. The only way forward is to just stop giving them our money, because if they privatize what is left of our public capital, the collection of federal income taxes will be reduced to mere naked, bald-faced robbery of the poor by the rich. Will we stand for that?
I think it is interesting to ponder the realities of other countries, where rulers and governments are known to be entirely corrupt, leaders known to be eager thieves with fat offshore accounts and golden mansions far from the common thoroughfares: In those places, a majority of economic activity takes place on black markets, thereby entirely surpassing the corrupt government intermediary, and choking off the flow of tax dollars that would be pocketed by the oligarchs in power, never to be seen again. There may be systems of barter and trade in place, and all sorts of under-the-table informal economic arrangements. We here in the U.S would do well to study the informal economies people around the world have designed to bypass the groping hands of a greedy and corrupt central government and its tax authority. We would also do well to remember that the initial inspired rebellion that led to this country’s independence was a refusal to bow under the yoke of unjust taxation.