Is the World Too Big to Fail?

By Noam Chomsky, Al Jazeera English

30 September 11

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

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

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

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

Privatising the planet

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

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

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

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

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

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

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

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

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

Targeting immigrants

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

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

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

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

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

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

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

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

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

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

Noam Chomsky is Institute Professor emeritus in the MIT Department of Linguistics and Philosophy. He is the author of numerous bestselling political works, including 9-11: Was There an Alternative? (Seven Stories Press), an updated version of his classic account, just being published this week with a major new essay - from which this post was adapted - considering the 10 years since the 9/11 attacks.

A version of this piece was originally published on TomDispatch.com.

The views expressed in this article are the author's own and do not necessarily reflect Al Jazeera's editorial policy.

Has the Obama of 2008 Really Returned?

By Randy Shaw, LA Progressive

29 September 11

ver since his strong speech on jobs, many Democrats believe they are finally seeing the Barack Obama they thought they elected in 2008. Obama insists he will veto any deficit-reduction measure that does not raise taxes on the rich, and he is using 2008-style rhetoric that Republicans denounce as "class warfare." This desire to believe that Obama is a fighter for real change is understandable, particularly as the prospect of a Rick Perry presidency looms.

Yet after all that has occurred, it is disappointing that the case for the new, fighting Obama is based entirely on speeches, not actions. For his deeds have not changed.

For example, as schools and libraries close due to lack of funds, Obama continues to spend billions on a fruitless war in Afghanistan. And it was this very month that he reversed EPA smog regulations. His Administration is still led by political insiders and opponents of real change. I understand the perils of a Perry presidency, but what concrete actions is Obama taking to get millions of disappointed voters back on his side?

In Michael Kazin's September 25 New York Times piece, "Whatever Happened to the American Left, " he makes the common sense observation that progressives should not "bet their future on politicians" but should instead "fashion their own institutions - unions, women's groups, community and immigrant centers and a witty, anti-authoritarian press" - that brought past success. But today's progressive institutions are weaker than in the past, and remain devoted to a president who has weakened rather than boosted their fortunes.

Afghanistan v. Funding Human Needs

If Obama were really committed to showing that he backs real change he could start by withdrawing all US troops from Afghanistan. That would certainly send the type of people-first message that Americans long to hear.

Yet the emails I get from progressive groups strongly backing Obama - SEIU, Move-On, Democracy for America to name but a few - rarely mention the costly war. These groups would be all over this deplorable budget priority if a Republican were President, but Obama gets a pass.

Why? The most common explanation I've heard is that Obama won't care about progressive criticism of Afghanistan, so there's no point fighting with him on the issue.

That's a great recipe for disempowerment. And one that progressives never found acceptable when an uncaring George W. Bush was in the White House.

I think voters would respond very positively to an Obama speech announcing a pullout from Afghanistan and a redirection of the funds to job creation at home. Yet if Obama's own base is not pressuring him on this, he'll just stay the course.

Obama's Budget Priorities

It's great that Obama vows to veto any deficit-reduction deal that cuts Medicare without taxing the rich. But why are progressives excited about a strategy that involves cutting Medicare?

There's no way candidate Obama would have defeated Hilary Clinton by promoting Medicare cuts. And the money saved by ending the Bush tax cuts for the wealthy was supposed to go toward education, transit, housing, the arts and other human needs, not as an offset for health care cuts.

It's astonishing how many progressives forget that Obama's 2010 State of the Union promoted deficit reduction, including a three year spending freeze on the discretionary programs that voters in 2008 thought he would increase. This speech was given while Democrats still maintained overwhelming majorities in the House and Senate.

Are many progressives really so scared of Obama losing in 2012 that they are willing to abandon their own priorities and principles? Never before have elements of the United States left been bought off so cheaply, in this case promoting the President in exchange for access, meetings, and speeches rather than any concrete results.

What happened to the American Left? It lost confidence in its power after electing a President whose commitment to real change did not last much past Election Day.

The Obama of 2008 cannot return because subsequent events showed he never existed. And recognizing this is the first step toward rebuilding progressive power.