Posts Tagged ‘Federal Reserve’

Reichwing Watch: How the Billionaires Brainwashed America

November 16, 2016

This is another excellent video from Reichwing Watch. Entitled Peasants for Plutocracy: How the Billionaires Brainwashed America, it’s about how wealthy industrialists, like the multi-billionaire Koch brothers, created modern Libertarianism and a stream of fake grassroots ‘astroturf’ organisations, in order to attack and roll back Roosevelt’s New Deal and the limited welfare state it introduced. And one of the many fake populist organisations the Koch brothers have set up is the Tea Party movement, despite the Kochs publicly distancing themselves from it.

The documentary begins with footage from an old black and white American Cold War propaganda movie, showing earnest young people from the middle decades of the last century discussing the nature of capitalism. It then moves on to Noam Chomsky’s own, very different perspective on an economy founded on private enterprise. Chomsky states that there has never been a purely capitalist economy. Were one to be established, it would very soon collapse, and so what we have now is state capitalism, with the state playing a very large role in keeping capitalism viable. He states that the alternative to this system is the one believed in by 19th century workers, in that the people, who worked in the mills should own the mills. He also states that they also believed that wage labour was little different from slavery, except in that it was temporary. This belief was so widespread that it was even accepted by the Republican party. The alternative to capitalism is genuinely democratic self-management. This conflicts with the existing power structure, which therefore does everything it can to make it seem unthinkable.

Libertarianism was founded in America in 1946/7 by an executive from the Chamber of Commerce in the form of the Foundation for Economic Education. This was basically a gigantic business lobby, financed by the heads of Fortune 500 companies, who also sat on its board. It’s goal was to destroy Roosevelt’s New Deal. Vice-President Wallace in an op-ed column in the New York Times stated that while its members posed as super-patriots, they wanted to roll back freedom and capture both state and economic power. The video also quotes Milton Friedman, the great advocate of Monetarism and free market economics, on capitalism as the system which offers the worst service at the highest possible profit. To be a good businessman, you have to be as mean and rotten as you can. And this view of capitalism goes back to Adam Smith. There is a clip of Mark Ames, the author of Going Postal, answering a question on why the media is so incurious about the true origins of Libertarianism. He states that they aren’t curious for the same reason the American media didn’t inquire into the true nature of the non-existent WMDs. It shows just how much propaganda and corruption there is in the American media.

The documentary then moves on to the Tea Party, the radical anti-tax movement, whose members deliberately hark back to the Boston Tea Party to the point of dressing up in 18th century costume. This section begins with clips of Fox News praising the Tea Party. This is then followed by Noam Chomsky on how people dread filling out their annual tax returns because they’ve been taught to see taxation as the state stealing their money. This is true in dictatorships. But in true democracy, it should be viewed differently, as the people at last being able to put into practice the plan in which everyone was involved in formulating. However, this frightens big business more than social security as it involves a functioning democracy. As a result, there is a concerted, and very successful campaign, to get people to fear big government.

The idea of the Tea Party was first aired by the CNBC reporter Rick Santilli in an on-air rant. Most of the Party’s members are normal, middle class Americans with little personal involvement in political campaigning. It is also officially a bi-partisan movement against government waste. But the real nature of the Tea Party was shown in the 2010 Tea Party Declaration of Independence, which stated that the Party’s aims were small government and a free market economy. In fact, the movement was effectively founded by the Koch brothers, Charles and David Koch. Back in the 1980s, David Koch was the Libertarian Party’s vice-president. The Libertarian Party’s 1980 platform stated that they intended to abolish just about every regulatory body and the welfare system. They intended to abolish the Department of Energy, Environmental Protection Agency, Food and Drug Authority, Occupational Health and Safety Administration, Federal Communications Commission, Federal Trade Commission, National Labor Relations Board, the FBI, CIA, Federal Reserve, Social Security, Welfare, the public (state) schools, and taxation. They abandoned this tactic, however, after pouring $2 million of their money into it, only to get one per cent of the vote. So in 1984 they founded the first of their wretched astroturf organisation, Citizens for a Sound Economy. The name was meant to make it appear to be a grassroots movement. However, their 1998 financial statement shows that it was funded entirely by wealthy businessmen like the Kochs. In 2004 the CSE split into two – Freedom Works, and Americans for Prosperity. The AFP holds an annual convention in Arlington, Virginia, attended by some of its 800,000 members. It was the AFP and the Kochs who were the real organising force behind the Tea Party. Within hours of Santilli’s rant, he had been given a list of 1/2 million names by the Kochs. Although the Koch’s have publicly distanced themselves from the Tea Party, the clip for this section of the documentary shows numerous delegates at the convention standing up to declare how they had organised Tea Parties in their states. But it isn’t only the AFP that does this. Freedom Works, which has nothing to do with the Kochs, also funds and organises the Tea Parties.

Mark Crispin Miller, an expert on propaganda, analysing these astroturf organisations makes the point that for propaganda to be effective, it must not seem like propaganda. It must seem to come either from a respected, neutral source, or from the people themselves. Hence the creation of these fake astroturf organisations.

After its foundation in the late 1940s, modern Libertarianism was forged in the late 1960s and ’70s by Charles Koch and Murray Rothbard. Libertarianism had previously been the ideology of the John Birch Society, a group harking back to the 19th century. Koch and Rothbard married this economic extreme liberalism, with the political liberalism of the hippy counterculture. They realised that the hippies hated the state, objecting to the police, drug laws, CIA and the Vietnam war. Ayn Rand, who is now credited as one of the great founders of Libertarianism for her extreme capitalist beliefs, despised them. The film has a photo of her, next to a long quote in which she describes Libertarianism as a mixture of capitalism and anarchism ‘worse than anything the New Left has proposed. It’s a mockery of philosophy and ideology. They sling slogans and try to ride on two different bandwagons… I could deal with a Marxist with a greater chance of reaching some kind of understanding, and with much greater respect.’

The documentary also goes on to show the very selective attitude towards drugs and democracy held by the two best-known American Libertarian politicos, Ron and Rand Paul. Despite the Libertarians’ supposedly pro-marijuana stance, the Pauls aren’t actually in favour of legalising it or any other drugs. They’re just in favour of devolving the authority to ban it to the individual states. If the federal government sends you to prison for weed, that, to them, is despotism. If its the individual state, it’s liberty.

And there’s a very telling place piece of footage where Ron Paul talks calmly about what a threat democracy is. He states clearly that democracy is dangerous, because it means mob rule, and privileges the majority over the minority. At this point the video breaks the conversation to show a caption pointing out that the Constitution was framed by a small group of wealthy plutocrats, not ‘we the people’. This is then followed by an American government film showing a sliding scale for societies showing their positions between the poles of democracy to despotism, which is equated with minority rule. The video shows another political scientist explaining that government and elites have always feared democracy, because when the people make their voices heard, they make the wrong decisions. Hence they are keen to create what Walter Lipmann in the 1920s called ‘manufacturing consent’. Real decisions are made by the elites. The people themselves are only allowed to participate as consumers. They are granted methods, which allow them to ratify the decisions of their masters, but denied the ability to inform themselves, organise and act for themselves.

While Libertarianism is far more popular in America than it is over here, this is another video that’s very relevant to British politics. There are Libertarians over here, who’ve adopted the extreme free-market views of von Hayek and his fellows. One of the Torygraph columnists was particularly vocal in his support for their doctrines. Modern Tory ideology has also taken over much from them. Margaret Thatcher was chiefly backed by the Libertarians in the Tory party, such as the National Association For Freedom, which understandably changed its name to the Freedom Foundation. The illegal rave culture of the late 1980s and 1990s, for example, operated out of part of Tory Central Office, just as Maggie Thatcher and John Major were trying to ban it and criminalise ‘music with a repetitive beat’. Virginian Bottomley appeared in the Mail on Sunday back in the early 1990s raving about how wonderful it would be to replace the police force with private security firms, hired by neighbourhoods themselves. That’s another Libertarian policy. It comes straight from Murray Rothbard. Rothbard also wanted to privatise the courts, arguing that justice would still operate, as communities would voluntarily submit to the fairest court as an impartial and non-coercive way of maintain the peace and keeping down crime. The speaker in this part of the video describes Koch and Rothbard as ‘cretins’. Of course, it’s a colossally stupid idea, which not even the Tory party wanted to back. Mind you, that’s probably because they’re all in favour of authoritarianism and state power when its wielded by the elite.

I’ve no doubt most of the Libertarians in this country also believe that they’re participating in some kind of grassroots, countercultural movement, unaware that this is all about the corporate elite trying to seize more power for themselves, undermine genuine democracy, and keep the masses poor, denied welfare support, state education, and, in Britain, destroying the NHS, the system of state healthcare that has kept this country healthy for nearly 70 years.

Libertarians do see themselves as anarchists, though anarcho-individualists, rather than collectivists like the anarcho-syndicalists or Communists. They aren’t. This is purely about expanding corporate power at the expense of the state and the ordinary citizens it protects and who it is supposed to represent and legislate for. And it in practice it is just as brutal as the authoritarianism it claims to oppose. In the 1980s the Freedom Association became notorious on the left because of its support for the death squads in Central America, also supported by that other Libertarian hero, Ronald Reagan.

Libertarianism is a brutal lie. It represents freedom only for the rich. For the rest of us, it means precisely the opposite.

New Labour and the Abandonment of Socialism and the Working Class

July 11, 2013

Yesterday Ed Milliband announced that he was ending the automatic contribution to the Labour party from the subscriptions of individual members of the trade unions. It marks a continuation of the New Labour policy of distancing the party from its origins in the unions. Way back in the 1990s, Tony Blair threatened to end the party’s ties to the unions altogether if they did not toe his line. It’s also part of the New Labour campaign of presenting itself as more middle class party. This process began under Neil Kinnock. The satirical British magazine, Private Eye, satirised Kinnock’s new middle class direction for the party by showing him shouting ‘Ich bin ein shareholder!’ Other spoof photographs on the same theme showed Kinnock shouting declaring, ‘I am an estate agent, and the son of estate agents’. Later Tony Blair was shown next to John Prescott saying, ‘We’re all middle class now’, to which Prescott replied ”appen I am, you middle class ponce’. Or words to that effect. We’ve come a long way since the Fabian Society published the pamphlet Natural Allies: Labour and the Unions, by Martin Upham and Tom Wilson in the 1980s.

New Labour and its Pursuit of the Middle Class and Increasing Alienation of the Working Class

The British conspiracy magazine, Lobster, has published a series of pieces charting and strongly criticising the rise of New labour and its abandonment of socialism and the working class. Simon Matthews in his review of Anthony Selden’s biography, Blair notes that the core of New Labour was a group of ‘modernising’ Labour MPs, the Project, consisting of Blair himself, Peter Mandelson, Margaret Hodge, John Carr, Jack Dromney and Sally Morgan, amongst others. It was essentially a response, shared by many other demoralised Leftists in Britain, the US and Australia, to Reagan and Thatcher’s electoral triumphs and the apparent victory of Neo-Liberal economics. Matthews considers that at the heart of New Labour’s political philosophy are the following ideas:

1. Middle class support is absolutely critical at every level. They must not be alienated through raising direct personal taxation.

2. The immense power of the media means that it is impossible to challenge them. They are therefore to be flattered and given good stories. The press are to be allowed to work in a deregulated market place.

3. If extra money is needed to pay for domestic projects, this may only be raised through the importation of cheap foreign labour. This increases the working population and lowers labour costs, so allowing an increase in tax revenue. This last policy has led to the increasing alienation of the White working class, that feels that Labour and the other mainstream political parties has abandoned them. The result is a resurgence in right-wing parties with anti-immigration policies, such as UKIP, or the English Defence League, which campaigns against radical Islam. This alienation has been noted by the BBC. A few years ago the BBC ran a series of programmes devoted to the issue of race in contemporary Britain. The trailer for this showed a White, working class man standing in front of a black background, slowly having his face covered in black ink until he became invisible. A gravelly voice then asked if the White working-class were being written out of Britain today. American critics of Neo-Conservatism have noted much the same attitudes in both the Democrat and Republican parties. The middle-class White members of these parties support affirmative action programmes, so long as they do not affect their children. See the volume, Confronting the New Conservatism.

American Commercial and Political Interests

Critical to the New Labour project has been collaboration with the Democrats in America, and the Australian Labour Party, but not with the Centre-Left European socialist parties. In the summer of 1993 Blair and Brown visited America, a trip arranged by the British embassy. There they met Alan Greenspan, the chairman of the Federal Reserved, who recommended that the Bank of England should set the interest rates in the UK. This was put into practice four years later when they gained power. Blair, and many of the other leading figures of New Labour – Gordon Brown, Ed Balls, David Miliband, Mo Mowlam, Patricia Hewitt and Tessa Blackstone, amongst others, had extensive transatlantic connections. They studied at American Universities, and/or worked for American companies.
Robin Ramsay, Lobster’s editor, has noted that New Labour represent American interests, and those of the British Foreign Office, determined to preserve both the ‘special relationship’ with the US and British commercial interests overseas. Blair himself stated as much in a speech he gave to Rupert Murdoch’s News International.

‘The Americans have made it clear they want a special relationship with Europe, not with Britain alone. If we are to be listened to seriously in Washington or Tokyo, or the Pacific, we will often be acting with the rest of Europe … The real patriotic case, therefore, for those who want Britain to maintain its traditional global role, is for leadership in Europe … the Labour government I hope to lead will be outward-looking, internationalist and committed to free and open trade, not an outdate and misguided narrow nationalism’.

The Primacy of the Financial Sector over Manufacturing

The privatisation and deregulation of the economy under Mrs Thatcher resulted in British companies having the largest overseas investments after the United States. The Blairites supported continued American power and international hegemony because it offered the best global protection to British commercial interests. Manufacturing industry and the public sector became merely special interest groups, which were simply taken for granted and ignored. Gavyn Davies in his comments supporting an independent Bank of England stated that the ‘one quarter of the economy that is affected by the exchange rate’ – in other words, manufacturing, could not be allowed to ‘take precedence over the inflation target’. In others, it should not prevent interest rates being kept high to attract capital to London.

A major part of the New Labour programme was the promotion of the interests of the City of London. The first draft of the Labour Party policy document, Meet the Challenge Make the Change: A New Agenda for Britain by a committee chaired by Bryan Gould stated in its section on finance:

‘The concentration of power and wealth in the City of London is the major cause of Britain’s economic problems’. It further argued that Britain’s economic policies had been for too long ‘dominated by City values and run in the interests of those who hold assets rather than those who produce’.

Seven years later, however, when New Labour had become dominant, the power of the City was seen as a source of economic strength. Peter Mandelson and Roger Liddle, in their book The Blair Revolution, published in 1996, claimed that

‘Britain can boast of some notable economic strengths – for example, the resilience and high internationalisation of our top companies, our strong industries like pharmaceuticals, aerospace, retaining and media; the pre-eminence of the City of London.’

The Blind Trusts, Labour Finance and Industry Group and Commercial Donors as Alternative Funding Sources to Traditional Membership Fees and Union Contributions

Tim Pendry, another contributor to Lobster, has described his experience with the Labour Finance and Industry Group and its use by Labour to construct an alternative source of funding from the trade unions and constituency activists. He considers that the party deliberately constructed an opaque and highly centralised funding system. The idea was that this would remove the party’s reliance on its traditional supporters, who as a demographic were considered to be aging and declining. The constituency system was believed to be costly and impossible to police. Moreover, it was vulnerable to being captured by the activists, who would make the party once more unelectable. The funds raised could be used by the Party to fund the kind of mass marketing that the Tories had achieved with Saatch and Saatchi. This policy was to result in the scandalous creation of a series of blind trusts. Pendry notes that the scandals surrounding New Labour and business came from their complete ignorance of the Puritanical ethics of the business community. He considered that many business leaders were horrified by the type of conduct that was considered acceptable in politics. Pendry wrote this in 2006. After the near collapse of western Capitalism under Goldman Sachs, Lehmann Brothers and the other major banks, these comments now seem somewhat ironic. Pendry himself has strong affection for the members of the Labour Finance and Industry Group. He describes them as decent, clubbable people, and notes that they themselves tended to be very much Old Labour – Gordon Brown, rather than Tony Blair. The result of the current parties’ reliance on funding from rich donors has resulted in the membership of both Labour and Tories plummeting. He estimated that Labour had about 200,000 members, while the Conservatives are around 300,000. The Conservative parliamentary leadership has also had problems recently with the apparent contempt with which it holds its members. Yesterday Cameron delivered a speech stating that grassroots Conservatives were highly valued by the party. This followed previous comments by senior party figures describing them as ‘swivel-eyed loons’.

Conclusion: Labour as Centre-Right Pary; Alienation of Working Class

The result of all this is that the Labour party has been transformed from a Centre-Left to Centre-Right party, keen to promote Neo-Liberal economic policies and distance itself from its roots in the 19th and early 20th century trade union movement. The result has been the gradual erosion under Labour of worker’s rights and the encroachment of the market through the Private Finance Initiative. Apart from the continued legacy of Mrs. Thatcher’s destruction of Britain’s manufacturing economy, the British working class has felt disenfranchised and alienated. A minority of its White members have been turning to more extreme nationalist organisations, such as UKIP, which are perceived as far more receptive to their interests.

Sources

Simon Matthews, ‘Our Leader’, in Lobster 48, Winter 2004, 34-5.

Tim Pendry, ‘The Labour Finance and Industry Group: A Memoir’, Lobster 51, Summer 2006, 3-9.

Robin Ramsey, ‘Contamination, the Labour Party, Nationalism and the Blairites’, Lobster 33, Summer 1997, 2-9.

A Note on Lobster

I’ve described Lobster as a conspiracy magazine, which makes it sound like one of those magazines devoted to insane, and frequently dangerous theories about secret governing elites like the Freemasons, Jews and now Reptoid aliens from the Pleiades. It’s not. It’s devoted to what its founder and editor, Robin Ramsey, describes as ‘parapolitics’. This is the study of politics as affected and influenced by genuine covert groups, such as funding lobbies, think tanks and the intelligence and security services. It bases its material on published studies and memoirs from the various groups involved, newspaper articles, and the personal experience of its contributors. It’s also on the web, and has an archives of some articles on-line.