Class warfare is nothing new in human history. It is as old as human civilization. At its core it is nothing more than the privileged classes trying to maintain the status quo – to maintain and expand upon their possession of a grossly disproportionate quantity of valuable resources, along with the political power that enables them to do so.
For several millennia this was rationalized with something akin to the doctrine of “
The Divine Right of Kings”. With the onset of such events as the
Enlightenment and the
American and
French Revolutions, the idea that a small class of human beings had a divine right to rule over others rapidly began to crumble.
A BRIEF HISTORY OF CLASS WAR IN THE UNITED STATESBut progress in that direction has been intermittent and much slower than many had hoped for. Though the United States was
founded upon the idea that “All men are created equal” and therefore have an “unalienable right to life, liberty and the pursuit of happiness”, that idea has given way to reality only slowly, intermittently, and incompletely. From the first days of the American republic, a huge part of our economy was dependent upon slavery, voting was restricted to our nation’s most elite white men, and our geographic expansion occurred mainly through
genocide against the continent’s native inhabitants.
Many of these wrongs were rectified to varying extents: Slavery was ended in 1865 with the
13th Amendment to our Constitution; the Native American genocide pretty much ended in the late 1890s, as white Americans completed their expansion to the western coast of the continent; and full (though theoretical) electoral enfranchisement of American citizens was complete by 1920, with the passage of the
19th Amendment, which enfranchised women.
Yet many injustices continued or were resurrected. The
Gilded Age of the mid- to late 19th Century saw the rise of corporate tyranny, with extreme inequalities of wealth. With the
end of Reconstruction in 1877,
repression of our former slaves and their descendents made a mockery of the Constitutional amendments that had provided them with basic freedoms and rights.
The
Progressive Movement of the late 19th and early 20th Century attempted to right many of the wrongs that maintained wealth and power in the hands of the elite few. Republican President Teddy Roosevelt was our first president to embody this movement – leading the way with aggressive and unprecedented
trust-busting efforts. After him, it was a series of
Democratic presidents who took the side of the people vs. the elite in the class war in the United States. President Wilson’s
New Freedom continued many of Roosevelt’s policies, following a four year interlude with TR’s pro-corporate Republican successor, William Howard Taft. The 1920s saw income and wealth inequality
climb to Gilded Age proportions (See Figure 1, page 5) under a succession of three Republican Presidents, culminating in the
Stock Market Crash of 1929, which led to the
Great Depression of the 1930s.
Progression of Peoples’ rights under a succession of 20th Century Democratic PresidentsIt was the
New Deal of Franklin Delano Roosevelt, our
second greatest president after Lincoln, that provided perhaps the most impressive and effective array of liberal-progressive legislation in human history,
brought our country out of its depression, and paved the way for the
greatest sustained economic boom in our nation’s history. At the root of FDR’s New Deal philosophy was the idea that our nation’s economic catastrophe was unacceptable, was the result of human fallibility, and should be corrected through government action aimed at reigning in our nation’s wealthy and powerful elite. Thus, regulations were imposed upon the power of our nation’s financial elite, including the
Glass Steagall Act, which prevented our nation’s banks from gambling with
our money. Our government took an
active role in jobs creation, leading to by far the
greatest record of job creation of any presidential administration in our nation’s history. And
Legislation was created to facilitate the ability of our nation’s working people to organize into labor unions in order to counter the power of the corporatocracy.
Harry Truman attempted to continue and expand on FDR’s New Deal, but was hampered in that effort by a Republican Congress. Most important, the
Taft-Hartley Act, passed by Congress over Truman’s veto, eradicated many of the rights given to labor unions by FDR’s New Deal.
John F. Kennedy
stood up against the financial elites of Wall Street and repeatedly
challenged his own military and CIA to draw him into wars of aggression. He also gave full support to the Civil Rights Movement, culminating in the
Civil Rights Act of 1964 and the
Voting Rights Act of 1965 under his successor, Lyndon Johnson, following Kennedy’s assassination. And Jimmy Carter put
strong emphasis on human rights to guide our foreign policy – an emphasis that had been sorely lacking under a succession of mostly Republican presidents.
The rise of corporate power under the Reagan RevolutionThe gains of FDR’s New Deal began to be dismantled following the election of Ronald Reagan to the US presidency in 1980, greatly aided by the fact that a large proportion of Americans who had witnessed the wonders of FDR’s New Deal were no longer alive. The guiding philosophy of the
Reagan Revolution was that “
government is not the solution to our problem; government is the problem” – precisely the opposite philosophy of the New Deal, which had led to the greatest sustained economic boom in U.S. history. Consequently, Reagan’s guiding principle was to undo New Deal regulations on corporate power which placed some restrictions on their pursuit of ever greater profits at the expense of the American people. In accordance with that principle, the Reagan administration took it upon itself to refuse to perform its constitutional responsibility to enforce the laws of our land, including the Glass Steagall Act. One of the major consequences of this was the
Savings and Loan Scandal, which cost American taxpayers more than a half trillion dollars.
Unfortunately, the election of a Democratic president in 1992 failed to counter the core ideas of the Reagan Revolution. Bill Clinton gave its central concept credibility by announcing that “
The era of big government is over”. By leading the passage of the
North American Free Trade Agreement (NAFTA), Clinton helped to expand corporate power at the expense of tens of millions of American workers. His signing of the
Telecommunications Act of 1996 allowed for the concentration of our news media into so few hands that it essentially became a tool of corporate power, rather than the independent voice of the people envisioned by our Founding Fathers. Clinton also signed the
repeal of the Glass-Steagall Act, which went a long way towards restoring the economic conditions that set the stage for the Great Depression of the 1930s. All of that, combined with the eight disastrous years of the George W. Bush presidency –
the worst presidency in U.S. history – set the stage for the
financial meltdown of 2007, as well as for the related multi-trillion dollar
tax-payer bailouts of our “too big to fail” banks and our current financial crisis.
THE OBAMA ADMINISTRATION ON CORPORATE REGULATIONOur corporatocracy complains that any government regulation of their activities constitutes an attack on their “freedom”. Yet they are happy to accept government charters that enable them to utilize resources that are beyond the grasp of ordinary citizens, as well as government subsidies, tax breaks, and bailouts at taxpayer expense when they fail.
The history of class warfare in the United States has been one of gross wealth inequality and economic catastrophe when corporate power is allowed free reign, and substantial benefit to the vast majority of Americans when government undertakes to put limits on corporate activity. The anti-regulatory spasms of the 1980s brought our country to the brink of disaster. Failure to put meaningful limits on the emission of greenhouse gases has already caused
droughts affecting millions of people,
buried several islands beneath the ocean, and threatens to end civilization as we know it. Insufficient regulation of the mining industry results in the
preventable deaths of mine workers. Deregulation of the telecommunications industry resulted in corporate control of much of our national news media. And deregulation of the financial industry led to our worst financial crisis since the Great Depression.
Obama commission to study over-regulation of businessIn view of our long history of serious adverse consequences to the American people attendant upon insufficient regulation of corporate activity, especially including our recent economic crisis, it is highly disturbing to see President
Obama establish a commission to study the
over-regulation of business:
President Obama ordered a government-wide review of federal regulations in an effort to improve or potentially repeal outdated, burdensome and inefficient rules that could be stifling private sector job growth. The White House released an
executive order establishing the administration's central regulatory strategy for protecting the health and safety of Americans while also preserving a capitalistic, free market economy. The order, first announced by Obama in a
Wall Street Journal op-ed on Tuesday, calls for a review of significant agency regulations that may no longer make sense.
After paying homage to those who have some respect for the need to regulate corporate activity, Obama is quoted as saying:
"But we are also making it our mission to root out regulations that conflict, that are not worth the cost, or that are just plain dumb." … Office of Management and Budget Director Jack Lew wrote, "We believe that it is particularly critical now, as our economy continues to recover and create new jobs…”
This kind of stuff plays right into the hands of the anti-regulatory fanatics. In the midst of abundant evidence of the dangers of failing to regulate corporate activity, instead of attempting to educate the American people on
that, our president chooses to emphasize the dangers of
over-regulation. Worse yet, in the midst of a severe economic crisis brought on by deregulation of an irresponsible financial sector that we term “too big to fail” while providing them with a
multi-trillion dollar bailout, the Obama administration speaks as if the solution to our current economic crisis is less, rather than more regulation.
The irony of this was not lost on Laura Flanders, writing an article titled “
Obama’s Deregulation Dance with Wall Street”:
With a new Republican Congress falling all over itself to hand corporations whatever they want, it was only a matter of time before some politician turned up in the pages of the Wall Street Journal, breathlessly describing the "dazzling" and "path-breaking" nature of the free market, and vowing to get rid of regulations that have placed "unreasonable" burdens on businesses. We just didn’t think it would be Barack Obama.
Inadequate regulation of our financial sector by the Obama administrationRobert Kuttner explains in his book, “
A Presidency in Peril – The Inside Story of Obama’s Promise, Wall Street’s Power, and the Struggle to Control our Economic Future”, how Obama failed to require regulatory reforms of Wall Street even in return for a multi-trillion dollar bailout:
In stark contrast with Roosevelt, who made a clean break with the old political and financial regime, Obama and his economic aides chose instead to work in concert with the Wall Street elite. The government’s immense sums of emergency aid were not used as leverage to compel more fundamental reforms. Even when continuing abuses were disclosed – exorbitant bonuses, new speculative schemes, conflicts of interest, refusals to supply needed credit to small businesses and homeowners – Obama seldom criticized the banks except on occasions when he needed a quick dose of symbolic populism. His administration’s goal was to restore trust in capital markets, even if confidence in the existing order was far from justified. All of this would prolong recession and favor Wall Street over Main Street. It was dubious economics, and worse politics…
On subsequent efforts to establish financial “reform”,
Robert Reich describes much the same dynamics at work as he characterizes the so-called
financial reform package enacted with the full support of the Obama administration.
The American people will continue to have to foot the bill for the mistakes of Wall Street’s biggest banks because the legislation does nothing to diminish the economic and political power of these giants. It does not cap their size. It does not resurrect the Glass-Steagall Act that once separated commercial (normal) banking from investment (casino) banking. It does not even link the pay of their traders and top executives to long-term performance. In other words, it does nothing to change their basic structure. And for this reason, it gives them an implicit federal insurance policy against failure unavailable to smaller banks – thereby adding to their economic and political power in the future.
Deregulation of big mediaOn the very same day that Obama launched his commission to study over-regulation of business, his Federal Communications Commission
(FCC) approved one of the biggest corporate mergers in American history, approving Comcast’s acquisition of a majority stake in NBC Universal. The vote was 4-1, with the four approvals coming from the two Republican appointees to the Commission plus the two Obama appointees. The one Democratic, non-Obama appointee to the Commission,
Michael Copps, vigorously dissented, saying:
Comcast's acquisition of NBC Universal is a transaction like no other that has come before this Commission – ever… It reaches into virtually every corner of our media and digital landscapes and will affect every citizen in the land…. It is distribution as well as content. And it confers too much power in one company's hands… The Comcast-NBCU joint venture opens the door to the cable-ization of the open Internet. The potential for walled gardens, tollbooths, content prioritization, access fees to reach end-users and a stake in the heart of independent content production is now very real.
Senator
Bernie Sanders (D-VT) commented, “Once we allow companies to become this powerful, the FCC does not regulate them. They regulate the FCC”. “Big media just got a lot bigger,"
Congressman Maurice Hinchey (D-NY) commented:
The FCC's decision to allow Comcast to acquire NBC Universal will burden the American people with more media consolidation, fewer independent sources of information and higher cable bills. I have no doubt that today's decision will lead to more mega media mergers in the near future. That is certainly not in the public interest.
And
Senator Al Franken (D-MN) said, while
vowing to fight "any further media consolidation of this kind”:
The FCC's action today is a tremendous disappointment. The commission is supposed to protect the public interest, not corporate interests. But what we see today is an effort by the FCC to appease the very companies it's charged with regulating… With approval of this merger, the FCC has given a single media conglomerate unprecedented control over the flow of information in America. This will ultimately mean higher cable and Internet bills, fewer independent voices in the media and less freedom of choice for all American consumers.
CORPORATE DEREGULATION AND CLASS WARThus it is that corporate deregulation and support for elite interests in the ongoing class war are highly related. The examples cited above represent a small fraction of those in which the Obama administration has supported elite interests over the interests of the majority of the American people. His
failure to call for a public health insurance option to provide competition with the health insurance industry – despite
campaign promises to do so – was the result of a deal cut with the health insurance industry. His
allowing the oil giant BP to dictate efforts to clean up the Gulf of Mexico oil spill (the one that they caused), as well as his
blocking of efforts to make public government estimates of the amount of oil spilled, also appears indicative of subservience to the interests of powerful corporations.
The elite class now has the strong upper hand in the class war, due to the related factors of obscene amounts of money, control over a multitude of elected government officials from both major political parties, and control of the national news media – to the great detriment of the majority of the American people. Matt Taibbi describes the basic situation in his book, “
The Great Derangement”:
A key point I took home from my examination of Congress was that both parties, Democratic and Republican, were equally guilty in what really was a conspiracy to run the government without outside interference. The only way the public could protest all the handouts and earmarks and fast-tracked tax breaks and other monstrosities was to vote for the other party – and the other party, it turned out, was inevitably whoring for the same moneyed masters. Excepting a few rogue, quixotic members who eschewed the usual campaign donors, Congress was mostly a highly advanced, finely tuned mechanism for turning favors into campaign donations and vice versa. It was a system of formalized political tribute not at all unlike that of the old Supreme Soviet…
That is what happens to a nation whose political system openly
allows public officials to be bribed as long as the details of the bribery aren’t explicitly spelled out in writing or on tape. That is what happens to a nation that allows its telecommunications system to be bought by powerful and wealthy interests. And that is what happens to a nation that becomes sold on the philosophy that corporate “freedom” to do whatever they want is more important than corporate
responsibility to the people whose government enables them to exist and thrive.
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