REVIEWS
- Greg Waite
THE ALTERNATIVE Author Nick Romeo has a degree in philosophy. I have no personal interest in philosophy, so I was surprised to find that background was what gave the book its heart. Romeo is no activist, but he very firmly believes that life should be full, not just scraping by, and he has no time for the rationalisations of modern economists who support today's global systems of wealth extraction.
That drives his enthusiasm to travel the world, interviewing the people involved in a range of initiatives which are out there now, changing the world locally, but largely ignored. Those stories are inspiring, ranging across "true cost" pricing, what makes a "living wage" liveable, how "job guarantees" work in practice, supportive public versions of "gig work" apps, land trusts, large and small-scale cooperatives, perpetual purpose trusts for businesses, employee ownership schemes, and participatory Government budgeting.
Before we come to those though, the first chapter sets the scene with stories from modern critics of mainstream economics. In one 2019 study, Ha-Joon Chang and Mohsen Javdani surveyed 2,400 economists around the world, asking if they agreed with a set of economic statements. The catch was, they randomly varied the author attributed to each.
They found that today's economists consistently disagreed with a statement more if attributed to Keynes* rather than a fictitious modern neoclassical economist; their professional judgement was biased in favour of today's dominant economic ideology. And not surprisingly, they didn't appreciate being caught out. One senior academic wrote to the junior author, Javdani, threatening to write to every economist in Canada to ensure he never got tenure. *John Maynard Keynes (1863 - 1946) advocated Government spending on public works to stimulate the economy and provide employment. He was the most influential Western economist for several decades after World War 2, until he was supplanted by the neoliberal monetarists. Ed
Would You Pay "True Prices"?
Would you be willing to pay the true price of your weekly supermarket shop, if it included the cost of "externalities", and the extra payment went to remedy that damage? For vegetables, that might compensate for the underpayment of workers who grew the crop or the climate impact of national or international transport. In economic terms, these are externalities - impacts on third parties which are not paid for by the producer.
Or rather than adding to the price, the organisation True Prices takes a rights-based approach, highlighting products which infringe on human rights specified by the United Nations, international treaties and national laws and widely held values. Either way, true prices help us understand the impact of our daily choices.
How Much Is A "Living Wage"?
Aotearoa has an active, visible and successful Living Wage movement, making it all the more interesting to read about how this approach has been developed overseas. The US has a more technically sophisticated approach, run by Massachusetts Institute of Technology (MIT) economic geographer Amy Glasmeier. The rate is calculated by a data-driven model which adjusts the proposed "living wage" according to the children and working adults in the home, the cost of local food, housing, transportation, childcare and other necessities.
But this and other calculators have been criticised: not everyone can find the same low-end rent, and many households found the wage too low to get by. An allowance for "civic engagement" was added recently, but there is no budget for retirement or home ownership savings, unexpected expenses, gifts, loan repayment, eating out. This is a pretty meagre life. Glasmeier's team calculated that a typical American single parent of two children earning $US7.25 per hour would need to work 138 hours a week to earn her living wage standard, and a couple would each have to work 75 hours a week.
Economist Robert Pollin calculated that the Federal minimum wage in 1968 adjusted for inflation to 2021 would be $US11.90, 64% more than today's $US7.25. And if the minimum wage had been adjusted for productivity growth over the same period, instead of transferred to the rich, the 2021 minimum wage would have been $US31.67, over four times today's rate! In 1965 the average top chief executive made 21 times the typical worker. In 2020, the ratio was 351 to 1.
One very practical application of the living wage is Well-Paid Maids, started in the US in 2017 by a former management consultant discouraged by the exploitation of domestic workers by large companies. He pays a minimum of SUS22 an hour plus 24 paid days off a year, predictable schedules, paid commuting costs, with health, dental and vision benefits. The result is happier workers doing a better job and lower turnover - and he is only a small employer in a large industry.
As the founder put it: "At the end of the day, this is what it costs, right? You're either paying for it now by actually paying the price of the service in a way that allows somebody to live, or you're paying for it in the externality. You're paying for it the societal and generational costs of how that person's kids are doing to grow up and what choices people are going to make in an environment of scarcity".
To put a historical perspective on today's debate and values, the phrase "living wage" first became widely popularised in a 1906 book entitled "A Living Wage" by the Catholic priest and reformer John A Ryan. Speaking six years later, Theodore Roosevelt argued that while the amount of a living wage would vary with local conditions, it must be sufficient "to secure the elements of a normal standard of living," including sickness, and savings for old age.
More recently, Milton Friedman and other conservative economists argue that competitive markets will ensure that workers earn what they deserve. Sadly, that's just the soft sell, translating to "capitalists will take whatever they can get away with". And it's reinforced by today's investor focus on short-term profits. The stock of major companies like Costco and Walmart drops if they announce wage increase, reinforcing executive priorities.
Times are changing though. In 2022 a Gallup poll showed that 71% of Americans approved of labour unions, the highest approval rating since 1965. Romeo advocates for Government procurement contracts to require US corporations to drop their reliance on union-busting, which is illegal in the US but ignored because the fines are less than the financial gains.
What If Everyone Was Guaranteed A Good Job?
Research has shown the benefits of offering work to the unemployed, but what does a "good job" look like? The Public Employment Service of Lower Austria demonstrated one model's success. Its 2020 programme offered something rather than enforced work, with participants involved in co-designing work to suit their abilities and interests. Participation was 100% and the results were very positive.
Economist Pavlina Tcherneva, a supporter of job guarantees, points out that the effective minimum wage for workers who can't find a job is zero, whereas a job guarantee extends the minimum wage to everyone. She scoffs at economists' "natural" rate of unemployment: "Suppose you heard that, in a strong economy, the optimal level of children who wanted to, but were unable to, receive primary and secondary education was 5%; or that there was a natural level of starvation equal to 5% of the population; or that 5% of people would ideally remain without shelter".
Yet a "natural" level of unemployment is standard modern economics. In 2019, US Federal Reserve Chairman Jerome Powell defended the idea: "We need the concept of the natural rate of unemployment. We need to have some sense of whether unemployment is high, low, or just right". "Just right" is the rate which keeps wages, union militancy and social costs low.
Yet a 2018 simulation by researchers at Levy Economics Institute found that a nationwide job guarantee, with a wage of $US15 an hour would likely cause the private sector to gain between 2.93 and 3.65 million jobs, due to the stimulation of employing an extra ten million Americans. State budgets would grow by tens of billions as the tax base expanded. The high-estimate cost was 1.5% of gross domestic product (GDP), compared with the 1% of GDP the Government spends on unemployment programmes, or US Defense spending at 3.3% of GDP.
Job Guarantees = Easier Way To Improve Private Pay And Conditions
Romeo also points to a larger impact. If a Government job guarantee set a higher wage floor of $US20 per hour, both the quality and the pay of private sector jobs would improve. "Rather than fighting deep-pocketed companies over many small improvements to labour conditions, pay, and benefits, a single decisive intervention to create a federal job guarantee could force gig companies, Amazon, fast-food chains, and other low-quality employers to improve pay and conditions to retain staff".
And: "The 'distress', 'poverty,'' and 'necessity' (of unemployment) that the 18th Century British writers and their intellectual descendants today see as essential motivations to work are risk factors for substance abuse, depression, anxiety, and physical illness, all of which are barriers to employment. If distress and poverty made people find jobs, the unemployed workers in the 1930s would all have been employed. The strategy of keeping millions in poverty to provide cheap comforts for the affluent fails morally and practically. Unemployment creates unemployability, with social impacts that ripple across society".
Job Guarantee projects receive funding based on three conditions: the creation of employment opportunities, no displacement of existing workers, and the social and environmental value of the activities. They might also speed up our green transition, or provide better care for the young or elderly not served by the private sector. Lower unemployment and a stronger social and cultural life might even protect against rising extremism.
The American Way
Another American form of underpayment is tipping. Restaurant workers in states like Kentucky and Texas get a minimum wage of just $US2.13 per hour, with tips making up the difference. You may have heard travellers praise the system because of the standard of service. Did you know though that women restaurant workers in states with a tipped subminimum wage are twice as likely to be sexually harassed?
America has the worst paid workers in the Organisation for Economic Cooperation and Development (OECD). Another part of the American way seems to be that Americans don't get what they want from their Government. Remember that earlier poll where 71% approved of unions? In a 2019 poll, 78% supported a Federal job guarantee, including a majority of strongly conservative voters.
Gig Work As A Public Utility, Not Wage-And-Conditions Theft
California passed Proposition 22 in 2020, denying gig workers the legal status of employees and associated benefits such as paid sick time and unemployment insurance, similar to NZ's laws on "self- employment". Companies like Uber, Lyft, and DoorDash spent over $US200 million campaigning for this law. This turned out to be a very good investment for their shareholders; the valuations of Uber and Lyft increased by $US13 billion after the law passed.
For workers, a university study found their guaranteed effective minimum wage was $US5.64. Across America, 58% of full-time gig workers said they would struggle to come up with $US400 in an emergency, while a study found the state and workers lost about $US100 million in state unemployment insurance a year by not classifying gig employees as workers. A report on Uber found that only 4% of drivers were still working for the company just 12 months later. This is a company which needs to rely on worker desperation.
The US Bureau of Labor Statistics reported that 34% of the American workforce now consisted of gig workers, and a reasonable extrapolation of current trends suggests more than half the American workforce will be working as freelancers by 2027. Aotearoa, fortunately, has not got there, yet - and we should be thinking how to avoid the same fate.
British "policy entrepreneur" Wingham Rowan suggests there may be a better solution than regulation. He asks: "What does a really healthy hourly labour market look like in the 21st Century? The power to create jobs in the informal economy, minimal transaction fees, data transparency, and responsiveness to labour laws and broader worker goals such as security, education and training. Everything I just described does not add up to a sizzling Silicon Valley investment opportunity. It's a public utility".
He proposes a public platform where workers were not locked down to one exploitative employer, where they were empowered to see and evaluate alternative jobs, where the transaction fee was under 5% instead of the 30% plus charged by gig-work corporations. In short, the public platform's design could be engineered to promote the public interest, not to make venture capitalists money.
Bring Back Government Competition!
The suggestion above - creating public services to drive out corporate exploitation - is worth really thinking about today, because despite economists and conservative politicians' assertions of State inefficiency, it feels like an ever-increasing share of corporations are ripping us off in every possible way. I agree - it's time to reassert the right and need for public competition - to deliver essential services affordably, to keep private markets competitive! As Rowan puts it, Uber and others were not dazzling innovations, they were predictable attempts to profit from the absence of essential public infrastructure.
Romeo also makes the general point that many markets are "natural monopolies", where the most efficient number of providers is one. This includes railroads and telephone services, but also social media networks and ride-hailing services. These will always be exploited by private companies, and more efficient as public utilities. It seems we need to remember and relearn this all over again. And another of his excellent points: the paradox that 52% of Americans want to work an extra day a week, but employers struggle to find workers. Wake up! You need better jobs and wages.
A broader point is raised by America's public workforce boards, which help the unemployed find work. Their performance metrics emphasise full-time work, but many people's responsibilities and capacities suit part time and flexible work. Casual work may be highly exploited today, but it is an important option and needs to be better organised.
The World's Largest Worker-Owned Cooperative
The Mondragon Cooperative is a voluntary association of 95 autonomous collectives which grew out of post-war poverty in the town of Mondragon in the Basque region of northeast Spain. Executives make at most six times the salary of the lowest paid employees. New workers become members after a probationary period, all votes are equal and the members vote on vital decisions about strategy, salaries, and policy. In good times, member-owners share in the profits. In hard times, the cooperatives can support each other, sharing profits and reallocating workers.
Members can buy into their co-ops by making a one-off payment of roughly €16,000, stored in an individual account and earning interest of up to 7.5% a year. An important point, and incentive, in how workers manage the business - if the co-op goes out of business, the funds disappear. But in good years bonuses add to the interest, leaving typical workers with about €250,000 when they retire at around age 62.
This is in addition to a generous pension from Mondragon's social security cooperative. A novel feature of the cooperative culture is their "culinary clubs", each of which has well-stocked kitchens and bars for workers to meet in as groups, cook and eat a collective meal. This is a world away from tips-for-wages in the US.
Participatory City Budgeting
The logic of participatory budgeting (PB) is that since citizens provide public funds and use public services, they can also do a good job of allocating a share of those funds. When done well, PB can strengthen civil society, increase transparency and trust in Government, and improve the quality of public works and services.
Cascais in Portugal is an example, where 15% of the city budget and around two dozen projects up to €350,000 each can be approved, then the city guarantees to complete them in three years. At open public meetings, any citizen can bring their proposal. Attendees are grouped up in sevens and hear each other's presentations, then each table agrees to propose one project for everyone to review.
The final number of projects depends on the number who attend each meeting, about one project per 60 people, which also motivates attendance. That's not the end of the process. Projects nominated at public sessions each spring then go through technical analysis by the Council, which may consult and improve them. And note the commitment to completion in three years, which keeps the Council motivated.
Sometimes locals choose to fund a project which should be provided by central Government but has not been prioritised, for example, new and safer trucks for the local fire brigade. So, the process can also provide a democratic and visible check on the effectiveness of more distant central Governments.
In Cascais, a similar youth programme operates in Cascais schools, starting participatory democracy young. And another interesting learning, the online version of PB during covid lockdowns were not a success. "If you really want to improve democracy, you need to create different face-to-face process of participation. The future of democracy is not on the Internet," said Romeo's local contact.
Businesses For A Purpose Not Profit
The US has a legal structure covering perpetual purpose trusts, where the management purpose(s) are specified and can replace the profit motive. An organisation, Purpose Economy, has been set up to support the process, with a focus on standardising the process to reduce costs (about $US30,000 working with their templates). Legal advice is quoted as $US800 an hour in the US, so needs to be minimised.
In Aotearoa, trusts are vehicles to reduce tax on wealth, but Purpose Economy targets existing business owners who want pro-social outcomes like sharing profits with workers, protecting the environment, or preserving affordable rental. There are no shareholders or investors sucking profits out of the company, and these trusts can last indefinitely, protecting the assets against future sale for profit.
As an example, a company owner whose parents had started several non-profits in their home town converted her business, now employing 50 staff, to a perpetual trust. As she approached retirement one third of the profits were shared with staff, one third were given to local no-profits, and one third was either reinvested or taken as a salary.
A second example was a bakery which doesn't ask background questions about applicants, just asks them to work a shift. Anyone willing to work hard and get better is welcome. A third purchased properties in a run-down area, renovated and rented them at sub-market rents, improving the neighbourhood but keeping it affordable. Romeo quotes a 2021 study from Chicago which estimated 40% of unsheltered homeless people were employed either full-or part-time. Currently, Purpose Economy relies on the good will of (often retiring) owners, but it does illustrate that business absolutely does not have to be about maximising profit and ignoring the social costs.
If only the US had the political will to, for example, take over corporate collapsed assets in crises, pay out the shareholders - but only at the remaining value once the crisis stabilises - then offer first right to buy ownership to the staff, set up as a perpetual trust with defined purposes including profit-sharing. No more corporate and shareholder abuse of power.
Building Worker Equity
Here, Romeo is talking about US employee stock ownership plans (ESOP) which grant company stock to employees, often based on duration of employment (in the UK, Employee Share Purchase Plans are bought with wage deductions). A 2019 study found median retirement savings among low-to moderate income worker-owners at 21 ESOPs were $US215,000 compared to the average retiree savings nationally of $US17,000.
Like perpetual purpose trusts, ESOPs can devolve part or complete ownership to workers. And they have tax advantages including deductions on repayment of debt used to buy worker shares. There are plenty of businesses interested - the problem is the lack of patient bridging capital, while the workers pay off their ownership share, and the returns that capital expects. Speaking of tax deductions, Romeo noted that excessive US pay to top executives is not just corporate greed. The Government approved unlimited tax deductions for performance-based pay in 1993, costing $US5 to $US10 billion every year since.
The Growing Problem Of Private Equity
Romeo is clear that ESOP is small scale, while private equity has raised more capital than public markets every year since 2009. Very rich individuals, the least ethical owners, are controlling an increasing share of private businesses. Values are pushed up to chase short term price gains, investment in research and productive capacity is reduced.
He points to a 2018 paper from Cornell Law School suggesting a National Investment Authority to "mobilise private capital in pursuit of long-term investments in both vital infrastructure and the real economy", saying the agency would channel private capital to support the creation of collective goods. Returns would be lower than private equity, but safer due to a line of credit from the Federal Reserve to guarantee the rate of return. But Romeo omits the key point - you can't draw capital back to long-term investment until you've also removed the ability to make higher profits from short-term investment vehicles.
Countering Inflation, Changing Economics
One area where Romeo is more radical is his response to inflation. Like Stiglitz and others, he debunks the US playbook of increasing interest rates to drive unemployment up and wages down. He quotes a comparison with "extinguishing a house fire by flooding the entire home. A more skilful strategy would be targeting the area of the house that is on fire, extinguishing the flames without causing water damage to the entire structure. One key to the location of the 'fire' is historically high corporate profits during the pandemic. Analysis found that fatter profit margins accounted for more than half of the price increases in the nonfinancial corporate sector".
He points out that two successful policy tools used during similar circumstances in the Second World War were an excess profit tax and strategic price controls in some sectors of the economy. Free market advocates will be shocked, but we can see clearly that current economic settings aren't working, so economic policies have to change too.
Beyond Philosophy, New Politics And New Economies
Romeo has done a great job here, gathering the human stories behind many initiatives which aim to create a fairer economy. He's a philosopher, so I guess he believes in the power of ideas to create change. A big yes to his suggestions for guaranteed jobs, and support for more cooperatives please; more public competition crowding out corporate theft; more worker-owned businesses. But to me, this world's going backwards for workers at such a rate, we'll need to take much stronger action to come close to improving it.
The first, foundational change is to build up State capacity again to support initiatives like these. Maybe we need to start with the relatively easy jobs guarantee to end unemployment and boost private wages and conditions. Then a stronger State could pull back from monetary responses to crises (the neoliberal use of inflation to lower militancy and wages), returning to fiscal stimulation with counter-cyclical State investments.
Big legal and regulatory changes are needed to shift investment from short-term to long-term. Developing countries need to rebuild their civic society and independent regional collaboration to help this happen. Those are huge changes in a world dominated by US corporate giants and economists. What kind of incremental steps might gain enough support? An excess profits tax seems like a good place to start, after that research on inflation during covid confirmed corporate profiteering was the main cause.
FREE AND EQUAL Here's another philosophical take on how to create a better world, this time developed from the ideas of political philosopher John Rawls. Starting from Rawls' egalitarian liberalism, Chandler aims to "build a case for a new progressive agenda to reshape our societies for the better". Many of the ideas are not new, so this book is more an attempt at creating a consistent and convincing rationale for a set of progressive policies.
Rawls's theory will not appeal to communists, as it allows for the continued existence of private property. I did find his discussion of capital and profit thought-provoking though, as someone not convinced by the traditional Marxist idea that profit is theft, so capital must be seized by the workers. Military force, followed by militarised Government, naturally follows.
Capital is essential for efficient production, and a reasonable return for capital investment is realistic. The problem today is the unconstrained extraction of capital, the rise of monopoly and supply chain dominance, the excess prices and profits, the funding for ideological dominance and Government complicity. There does seem room today, following the recent revival of real economic analysis and the critiques of neoliberalism, for a middle path. If State capacity is rebuilt, today's frequent crises highlight where capitalism is going wrong and offer an opportunity to employ real solutions.
Impose back the costs of misinvestment with Government takeovers of failed assets, imposing the cost on the shareholders. Estimate the economic cost of decades of social media theft and tax avoidance around the world, and tax it back. Create real competition for monopolies by breaking them up, recreate cost-price Government agencies to manage natural monopolies, create pathways towards businesses with workers sharing management. Yes, yes, a lot of political change would be needed to do these - but given a choice between violence and political struggle, I'm recommending the latter.
Freedom, Democracy, Equality Of Opportunity, And Workplace Democracy
The structure of the book is first to define "what's fair" and suggest a compatible new social contract. Five further chapters then deal with Freedom, Democracy, Equality of Opportunity, and Workplace Democracy. Under fairness in USA, Chandler cites "a seminal study" by political scientists Marin Gilens and Benjamin Page, who collated data on 1,779 proposed changes to US Federal policy between 1981 and 2002.
For each policy they looked at the relationships between the decision taken and the views of three different groups as measured in surveys: "average" citizens, with median incomes; "rich" citizens, 90th percentile incomes; and "interest and advocacy groups" such as business associations, unions and charities. When the rich wanted something different to the average American, they almost always got their way. Interest groups had less interest than the rich, but still much more than average citizens.
On democracy, Chandler sticks by traditional representative democracy, but insists the USA has to urgently cap political donations. To cover electoral costs, he backs a "democracy voucher" of say $US50 for everyone, which they can donate to the party of their choice. The extremely low intergenerational mobility of the US is well known. Chandler points out that lower levels of inequality are associated with higher social mobility, so American incomes have to become more equal to improve this fundamental failure. Ensuring equal access to quality education is also critical to improving social mobility, particularly in the first five years of life and vocational education.
Looking internationally at minimum wages and trade unions, in countries like NZ, France and Portugal, minimum wages are more than 60% of median earnings. In America the federal minimum wage stands at around 30% of median earnings! Collective bargaining, at the level of sector or industry, is normal for one third of OECD countries, but illegal union-busting is the standard corporate response in the US. Chandler also supports job guarantees as important contributors to lower inequality and points to research that a high top tax rate does not damage growth, while capital gains and income taxes need to be equalised to discourage income management for tax avoidance.
Looking beyond incomes, he promotes Citizens' Wealth Funds owned by, and managed on behalf of, the whole population. These funds could aim to build up as high as 50% of national wealth, providing an annual citizens' dividend and covering a share of the cost of Universal Basic Income. Norway's sovereign wealth fund, first established in 1990, is now three times GDP, US$1.4 trillion in 2021. It grew from mandated contributions set at 25% of the State's royalties and rents from natural resources.
Workplace Democracy
Co-management already exists in parts of Europe. Workers elect a share of the board of directors, from one third for medium sized firms in Germany (500+) to one half in firms with over 2,000 staff. More than half of European Union (EU) countries grant workers this right. A second characteristic feature is works councils, where management has to share information and debate the goals and state of the company.
Co-managed companies have been found to offer better wages and condition and more employment stability, while encouraging more internal investment and higher productivity. Profit-sharing plays an important role in France, with bonuses kicking in when annual profits exceed 5% of a company's equity. 51% of workers had access to some kind of profit-sharing scheme in 2018.
To grow the smaller cooperative sector, Chandler promotes the creation of a cooperative bank to ensure capital is available to establish new cooperatives. He also recommends making it easier to convert shareholder owned firms to worker owned cooperatives. The key to making this happen is to give workers the legal right to initiate employee buyouts. This right does exist, with limitations, in Italy and allows for a binding referendum if 10% of staff support it.
And in his conclusion Chandler notes: "The popular narrative that progressive parties' positions have driven working-class voters to embrace Rightwing extremists is flatly contradicted by the evidence: only a small minority of former centre-Left voters have moved to the far Right - most have gone to the Greens and to other Left parties, or to the mainstream Right; far Right parties still win only a small share of the working-class vote".
THE INEQUALITY OF WEALTH This is another book about creating a fairer world which I can thoroughly recommend. Surprisingly, it's written by a UK politician, though a rather unusual one. Byrne represented Birmingham Hodge Hill, described as the most income-deprived community in Britain, from 2004 to 2024. From a comprehensive school, he studied economics at Harvard Business School but wasn't impressed.
In his first year he was taught by Michael Porter, the guru of corporate strategy, and he's scathing about Porter's famous assertion "the perfectly competitive industry offers the worst prospects for long-run profitability". This maxim underpinned the education of generations of US business students, encouraging entrepreneurs to build dominant market positions to extract excess profits. Byrne hasn't forgotten, and his preference for competition and ethical business underpins this book.
"The Inequality Of Wealth" offers a) a very critical history of the UK's global economic exploitation leading up to the corrupt mess which is today's capitalism, and b) an evidence-based Government programme to create a fairer world which voters might actually support (so the Government stays in and the policies endure).
Byrne spells out his differences with mainstream Labour parties in the UK (and NZ), where party machines are like corporate marketing departments. They use public polling to test which slight departures from current orthodoxy are most saleable. They focus on fine-tuning political language. Ultimately, they keep things the same - and with neoliberal free-market crap dominating political economy after the 1980s, keeping things the same has proven very bad for everyone except the rich. Reading this book has the great advantage that you can call neoliberalism crap with confidence, because Byrne gives you such a good description of how it arose, the various academic voices, think-tanks, institutions - and the money behind it all. I was surprised to read this from a UK politician!
On the policy front, Byrne starts from scratch, looking at the evidence for what's wrong with our economics, what works better and where. Then he adds public polling, but this time using questions designed specifically to test what voters currently understand and what they might support in future. As activists we don't think much of polling because it's often abused and typically limits the scope of debate. Here, its thought provoking, because its supporting radical new economic policy.
Byrne is on a mission to create a fairer economy and he doesn't pull punches in his criticism of neoliberalism. He quotes research which, in short, shows that rich people have less empathy, are less likely to share resources and more likely to lie. Why would you want to give these people political power? (Trump for President, anyone?). And he's very blunt about the abuse of political influence by wealthy insiders in the UK and the US, detail we don't have room for here.
I will quote this from a report by Margaret Hodge, previously Chair of the UK Parliament's Public Accounts Committee, unpublished because of legal threats. The report was titled "Losing Our Moral Compass: Corrupt Money And Corrupt Politic": "Tax is avoided or evaded through the very same mechanisms by which money is laundered". The UK like many other countries has "golden visas", where money buys citizenship, and London is a favoured bolthole for oligarchs because the City financial industry is happy to launder their cash. Around 1% of all UK property is now owned by overseas residents.
Moving on to the evidence on generational inequality, the other side of the coin to excess wealth, if you are a child of someone in the top 1%, your chances of working for the very same employer as your father are over 70% (US, Canada, Denmark). How about that for a perfect illustration of how wealth and poverty are passed across generations.
This Time Is Different
Byrne also spells out the broader picture of Gen Z disadvantage. The flat real wages, higher education debt, higher home purchase costs, renting into retirement. The rapid rise in total wealth, so that wealth has risen from three times GDP 30 years ago to eight times GDP. Wealth is simply relatively much more important than income today - a huge point, well made, and worth remembering as NZ begins to seriously debate wealth taxes.
Here's another big point I haven't seen made so clearly elsewhere: "Though we do not like to say it, we live in a gerontocracy". And he spells out exactly how this worked in the UK. First, Thatcher forced councils to sell off their social housing in the 1980s. Before her election, 42% of the British population lived in council homes. 2.6 million homes were sold off at discounts of up to 70% of the value, buying many older voters for life. Second, the pension rate is guaranteed by the UK's "triple lock" promise, rising annually at the higher of the rise in earnings, inflation or 2.5%. Third, pension reforms in 2015 allowed those who retired early to take a quarter of this fattened pension fund in cash.
Fourth, neoliberalism and monetarist orthodoxy cuts fiscal (Government spending) responses to recessions, forcing reserve banks to stimulate via lower interest rates. The result was a bonus to older home-owners, to the disadvantage of all future generations. Quoting Byrne on this key point of economic policy: "A variety of analysts have now shown that the rise in real house prices since 2000 can be explained almost entirely by these lower interest rates" (Mulheirn, I (2019); Lewis, J & Cumming, F (2019); Miles, D & Munro, V (2019).
Fifth, the UK's pension scheme assesses the bond size required to fund the future stream of payments. When interest rates are low, the bond has to be larger, which has increased the wealth of retirees since 2000. This seems a bizarre result - surely, they'd assign the bond size based on long term expectations of a return to normal interest rates - but I'm taking Byrne's word for it (page 59). He was the Chief Secretary to the Treasury from 2009-2010.
Maybe it's a sign that low interest rates will stick around? As I mentioned briefly earlier, when neoliberal Governments like our own coalition refuse to stimulate the economy through a downturn by e.g. building infrastructure, reserve banks are forced to take up the slack with the blunt instrument of lowering interest rates. The rich love this. Cheap debt for share buybacks and short-term profit, another asset price hike for those with multiple homes.
Anyway, this flow of more wealth to the old and the wealthy has two implications for taxation and future Government income. First, wealth is becoming more important than income; and second, a particularly large intergenerational transfer will occur when the current generation of baby boomers die. So, it's particularly important now to debate and build support for new policies.
The next generational transfer will be different. Today's retirees benefited as a class from asset price inflation, but today's younger generations will be worse off than their parents when they retire. But after this next big intergenerational transfer, only the rich will inherit the Earth - unless we are successful in changing politics and economic orthodoxy.
How The Neoliberal Sham Was Constructed
A number of key independent economists have revealed the neoliberal sham in recent years. Search out, for example, presentations on the UK's Institute for Innovation and Public Purpose Website and Joseph Stiglitz's outspoken recent speaking tour across Australia. Still, Byrne's description is clear and concise, one of the best. And I enjoyed his evocative introduction to the chapter "All Hail The Market", which captures nicely the rise of neoliberalism from a few old rich conservatives privately plotting their comeback, up to today's domination of modern political thought.
"Worldviews in political life are not the product of lone scribblers but packs of them, who create symphonies of compatible, sympathetic ideas sculpted together like the great edifice of a cathedral. They are in their own way magnificent, intimidating and seemingly inevitable. Until they collapse. 'Market supremacism' is precisely such a symphony, an extraordinary harmony of intellectual effort, its intricacies alluring, enchanting - and as dangerous as the Siren's song, tempting us onto the rocks".
The story starts with Franklin D Roosevelt's New Deal, which created social security, union rights, minimum wages, public works, public housing and public support for farming through the 1930s. The conservative clawback began with Walter Lippmann's "The Good Society", which emphasised a key idea of neoliberalism: "a prosperous and peaceful society must be free".
Friedrich Hayek's "The Road To Serfdom" followed, arguing that only markets could efficiently allocate resources, while State intervention (apparently) led to a slide towards dictatorship. Then came Milton Friedman's "Monetary History Of The United States", which reinterpreted the cause of the 1930s' Depression as the Federal Reserve's failure to maintain the US money supply.
After the theoreticians came the mathematicians, developing models of the economy and "proving" market efficiency in these artificial oversimplifications. Then came the monetarists. And all this new economic theory inspired new political thought which, simply put, wanted to minimise the State and maximise corporate freedom.
Last came the politicians, notably Ronald Reagan, who brought all these ideas together and added soft sell to the hard new Rightwing economics: "This is the issue of this election: whether we believe in our capacity for self-government, or whether we abandon the American Revolution and confess that a little intellectual elite in a far-distant capital can plan our lives for us better than we can plan them ourselves". The "Washington consensus" was born.
From Grand Words To Ugly Reality
But as Winston Churchill said: "However beautiful the strategy, you should occasionally look at the results". And Byrne does: "Forty years of market supremacism has created a country that produces peaks of inequality so high that our systems of redistribution find it hard to flatten them. Market supremacy inexorably drives up returns to capital and drives down returns to labour, otherwise known as your pay packet. Today, our economies are riddled with rent-seeking, like a form of dry rot ('rent-seeking' means gaining excess profits through domination of markets and supply chains). All sorts of businesses make fortunes by controlling choke points in the economy".
He refers to the social media giants as "technopolies", explaining how each uses dominance of their sector to identify and buy out potential competitors while they are still small enough not to trigger the market capitalisation threshold which triggers anti-monopoly investigation. Google/Alphabet has bought 224 businesses since its founding, Facebook/Meta has bought almost 100. On billionaires' political influence, Byrne highlights the US Supreme Court's 2010 Citizens United ruling which granted corporations unfettered freedoms of free speech, which translates to the right to supply billions for the election of their preferred candidates.
Byrne had an interesting take on labour force migration which I hadn't seen before. He saw it as complementary to "capital account convertibility", i.e. the 1990s' push by the IMF, OECD and EU for the right of corporations to move production and jobs across national borders. This tool to bargain down wages to the level of the lowest states won't work for domestic service industries, so corporate freedom to import cheaper labour achieves the same purpose of driving down wages. The end result is growing inequality of incomes and wealth, but as Byrne points out, a decade after Piketty's bestselling book "Capital In The 21st Century", we still lack political consensus on what to do.
Byrne's Policy Proposals
Since four factors drive societal wealth - income, assets, rates of return, and tax - Byrne proposes five related policy goals and devotes a chapter to the specifics of each:
To raise earnings, Byrne points to research which indicates lowering taxes on low paid employees is the most effective way to increase growth, and public surveys which support tax reform as the most effective response to inequality, followed by a Universal Basic Income, raising the minimum wage, then capping executive packages. He also supports a Universal Basic Income and education, retraining and research all play an important role, which need funding.
Byrne suggests five steps to shift corporations from maximising short-term shareholder returns to civic capitalism:
I doubt this is enough, but it's a start. Byrne also makes the standard point about today's investors largely holding diversified portfolios, which makes them passive investors, less likely to rein in risky management. From my reading, I don't think this is the main issue. Pension funds are now very large, with plenty of expertise. The main problem is the large insurance companies, who pressure funds to outsource their choices to asset management companies - the absolute worst model of corporate stewardship.
Asset managers like BlackRock create shorter term shell investment vehicles, sold on after say eight years, which encourages them to load extra debt on their purchases, to increase fees, ratchet up rents when they buy residential property or infrastructure, etc. Their business model transfers the risk to the Government partner, while increasing the cost of products. If private insurance is undermining productivity, it needs regulation or public competition, and preferably both.
To ensure savings for all, Byrne advocates a new system for Universal Basic Capital. This would be a Government programme for everyone, in contrast to the current split between welfare benefits for the poor and tax breaks for the rich (pension supplements, student debt write-off, home purchase subsidies). With today's rising costs and rents, 44% of UK adults say they don't expect to be able to save money in the year ahead. The scheme would have an employer contribution, tax incentives, and be available flexibly for education, housing, self-employment and retirement needs, with contributions beginning at 16. Money would be invested to provide good annual returns to the accountholder.
The proposed sovereign wealth fund is interesting because these funds can take many forms. They can stabilise volatile export prices, diversify away from oil, fund social programmes, boost citizen savings, or simply pay citizen dividends to all at say age 25. Wealth funds make the higher returns available to large investors available to all, while increasing the pool of ethical shareholders. In that form, they are a visible Government institution which helps everybody, rebuilding public support for larger Government.
Norway's, the world's largest, invested oil revenues to provide long term income when oil runs out. Alaska's, begun in 1976 and funded with an oil levy, is now worth more than Alaska's annual GDP. Sweden's, started in 1984, levied a tax on excess corporate profits and owned 7% of Swedish company shares by 1991; the fund was ended by incoming conservatives.
And a sovereign wealth fund would also be a great place to hold corporate shares acquired during crises, where the State takes over assets until their current value can be fairly assessed. Income sources for these funds can vary, for example Governments borrowing cheap to buy shares, redeploying currency reserves, or various levies and taxes, including capital income and wealth.
Fairer Taxes
Byrne's polling confirmed the British public backed tax reform as the best way to reduce inequality, specifically through reducing tax avoidance and use of tax havens. Their second priority was an annual wealth tax on individual net wealth over £10 million. International initiatives to curb tax avoidance ramped up after the Global Financial Crisis but are still moving slowly, undermined by the US and UK.
Byrne makes some good points on tax collection. First, hire more tax collectors, they always return more than they cost. Second, add general anti-abuse clauses to tax law which allow regulators to seize assets and imprison individuals who don't disclose tax minimisation schemes for assessment. Third, create compulsory registers of assets to improve visibility and oversight of wealth.
Fourth, trade deals have been a missed opportunity and should always include tax improvements. Fifth, increase public disclosure and Parliamentary oversight on tax collection. Sixth, consider increasing the tax on income from capital, which is much lower than the tax on work income. Seventh, with wealth growth outpacing income growth, wealth taxes are inevitable.
Wealth Vs Income
Currently, three OECD countries have wealth taxes - Norway, Spain and Switzerland. Eighth, a return to fiscal rather than monetary stimulation in recessions (Government spending rather than lower interest rates) would reduce future wealth bubbles. And in an interesting comparison to NZ, the average UK resident earning more than £10 million had an effective tax rate of 21%.
Whereas our recent Inland Revenue Department (IRD) investigation of high-net worth individuals found they paid on average 8.9%. You probably also heard reports of new research which confirmed well-off New Zealanders are paying the least tax compared with their peers in nine similar OECD nations (Tax Justice Aotearoa/RNZ,19/9/24).
The possible downsides to wealth taxes cited by the wealthy and their accountants are noted, e.g. they might reduce growth by discouraging productive investment. This line is looking pretty thin in a world dominated by short-term pursuit of share-price gains and asset management vehicles which increase the cost of social infrastructure and homes. Byrne's strategy of growing ethical social investment and regulating exploitative asset management looks a lot more positive for our future.
Byrne concludes: "We enshrine freedom, security and power with rights, which we sustain by law, but we underwrite them with wealth. Which is why, if we want to build a new democracy of freedom, we have to rebuild a wealth-owning democracy. When we diffuse wealth, we diffuse power. We guard against the ability of others to dominate us at work or at home, so that no-one can lord it over us. We encourage traditions of prudence and engagement in public life, themselves the best guarantor of a lively democracy and the best defence against a life lived at the mercy of others".
I get the feeling Byrne was channelling Hayek's "The Road To Serfdom" when he wrote these words. Hayek built the case for neoliberalism by portraying remote elites in Government growing to dominate everyday life and take away everyman's freedom. After 40 years under neoliberalism, we have seen the rich lobbyists ensure we lost all the protections we previously received from the State, while the arrogant rich create crises by extracting instead of investing, and do their best to take over the world. Byrne has reversed Hayek's imagery to point out that well-run Governments offer our best hope for a positive future.
WE ARE NOT ABLE TO LIVE IN THE SKY "Go walk around and see what it's like yourself" - Kadija Turay
Kardas-Nelson introduces chapter one of her book with this quote for a reason. Her theme is the West's failure to understand the complexity of Third World economies, hence their failure to delivery effective aid programmes. And she explains straight up how she came to write it: "Throughout the 2000s, microfinance seemed to be everywhere, even if mentioned only briefly: in college economic and international relations courses, by presidents, at rock concerts, interviews with celebrities, at my family's summer BBQs. And then, suddenly, around the year 2010, I stopped hearing so much about microfinance. It was as if the programme that had promised to uplift millions had quietly died".
"I moved to Sierra Leone, West Africa, in 2015, when I took a job with a health organisation just as the country was emerging from the largest Ebola outbreak in world history. A couple of years into my stay, while talking with a colleague about her previous job at a Sierra Leonean legal aid organisation called AdvocAid, she mentioned that AdvocAid had documented women being taken to police stations and to prison for failure to pay their microfinance loans".
"I have a vivid memory of how surprised I felt. Later that afternoon, I walked across the street to the fruit and vegetable vendor I often bought cabbage, mangoes, pineapple, and coriander from, asking her if she knew of anyone who had taken out such a loan. She looked at me like I was an idiot. 'Yes. I've taken out many. Many! Every few months. In fact, I have a few right now'. Back at the office, I asked a colleague whether he knew anyone who had taken out microfinance loans. 'Yes!'' he said. 'My wife!'".
Stories like this are a recurring theme among aid workers interviewed in this book, where they realise their ignorance of local customs, economies and histories, and hence their inadequacy to provide meaningful help. This story of microfinance also raises bigger questions: the role of narratives and saleable storytelling in overhyping innovations and ignoring complexity, the West's ability to quietly obscure their interventions when they turn bad, the limiting of aid to forms which benefit rich nations, the pressure to deliver aid for profit with all the implications which flow from that change, and male domination or violence as a legacy of colonialism taking new forms under new Governments.
Early Good Intentions, Good Practices
Bangladesh economist Muhammad Yunus was the best-known promoter of microfinance. Returning from the US in the early 1970s to help his Government after independence, he found ineffective bureaucrats overwhelmed by foreign consultants. After finding local money lenders charging 10% per day to the poorest women working from home, he started a series of local funds which loaned small amounts to women at reasonable rates, initially from his own pocket.
To grow the scheme, he had to work with banks and Government. The first bank wanted local well-to-dos as guarantors, but Yunus again acted as guarantor. Later iterations grouped women together, creating collective responsibility. Repayments and interest rates were kept low. When the Central Bank of Bangladesh became involved, it insisted on being the majority shareholder: Yunus insisted the lenders retained 40%, so that returns flowed back to the borrowers. This was the Grameen Bank, which means "of the village".
The book tracks the changing nature of microfinance, informed by many interviews and supported with historical research. And these analytical chapters are interspersed with a series of evolving stories about the complex everyday lives of impoverished women, against the wider pressures from corruption, male domination and extortion, wars and inflation. These stories spell out both the flaws of Western dominated aid and the naivety of believing that microfinance could fix such complex inequality.
One interesting chapter describes earlier iterations of microfinance which were delivered as part of integrated programmes delivered at the community level by a Leftwing Government, which made them much more effective. Exactly the type of Government and programme the US CIA wiped out when it supported generals to wage mass-murder campaigns in ex-colonies.
Another chapter traces the early days of the US Peace Corps, started under Kennedy, where idealistic young Americans were sent off on vague missions to "organise the community to improve its own standard of living through community action and cooperation". The programme and its training improved, gradually shifting the emphasis from top-down assistance and helping established small businesses towards ground-up initiatives which supported and involved the poorest. Understanding of the "informal sector" was growing, since it could be as much of 70% of the economy in poor countries. And independent microfinance organisations were growing, raising their own finance so they were independent of Government interference.
"Every Day It's Money Business"
But the women's lives are the heart of the book, for example this story about finding money to cover a child's education: "Every day it's money business. Every day! Like the other day - look, I won't lie, I didn't have money. The people at the school beat her for that, said she should never come back. I was really mad! They should really understand. I'll give it to them when I can, but when I can't they have to be patient. I'm not going to go steal something, to come and give something to teacher. What they're doing - that's stealing".
And another where a wife has to raid her microfinanced home shop's funds to cover her husband, pulled over while driving his employer's car in a wealthy area favoured by foreign consultants. "The neighbourhood was full of money, which meant everyone was looking for an opportunity. A white SUV stamped with an NGO logo was irresistible to the police officer who pointed out the car was parked illegally and the licence plates had expired. A violation that could land one in prison, he pointed out, but a problem that could be resolved if he offered $US80. Holding Idrissa's licence ensured payment, which his boss later negotiated down to $US40, nearly a third of his $US150 monthly salary".
Themes range across home-based isolation, underfunded Governments, inflation and troubled times, civil war and looting, missed repayments, aunts disappearing into the police and prison cells after failing to repay loans, sleeping on concrete, family giving guards a $US30c "tip" to visit and $US50c to bring extra food. And these hardships grow progressively as the microfinance industry becomes fully privatised, fully profit-seeking. Incentives encourage middlemen to loan larger amounts which are harder to repay, higher interest rates (5% originally, 30% today) and private profits extracted, a shift back to lending to men and to established small businesses.
At the end, the author steers clear of easy answers, emphasising the need for holistic social understanding, addressing structural issues and inequality, a comprehensive response to improve Government services and regulation. And she suggests it's not clear even with best practice what outside organisations are bringing to microfinance. Locally-led programmes integrated to their community are just better, but that's not the American Way.
The microfinance sector has continued to grow, with a few key players dominating the major markets and an estimated 140 million people holding a microfinance loan today. In 2019, JP Morgan partnered with ResponsAbility Investments AG, a Swiss-based asset management company, to create a $US175 million collateralised microfinance package. Collateralised loans are what blew up the world economy in the 2008 financial crisis. Microfinance IPO (initial public share offerings) continue. Compartamos, one of Mexico's most profitable microfinance lenders, continues to grow and includes Goldman Sachs Asset Management, BlackRock Fund Advisors and the Vanguard Group in its shareholders.
Kardas-Nelson quotes Phil Mader of the Institute of Development Studies as saying he isn't surprised that groups like the Centre for Financial Inclusion find themselves baffled when things like bank accounts and savings programmes don't seem to address greater issues of wealth inequality and inadequate public services.
"There is some really strong willingness to believe that financial services are the key to solving so many people's problems. I would never idolise (financial services) as anything that's saved me from any calamity, but we're saying they can save the poor by shortening the length from Wall Street to these people. We've never lived in such a finance-saturated era. It's like the development sector has found a hammer and then everything is a nail. Think about if digital loans were offered as a replacement for social services in your country. Would that be good enough?" The stories above show what happens when a single, financially focused solution to global inequity ignores the real drivers of poverty.
Need To Take Care Of A Whole Person
And Kardas-Nelson: "Even if a person suddenly has a new cow, or a new way to pay for schools that doesn't mean the milk gets to market or school fees won't keep going up or that the education will be quality. It seems clear - I'd argue even more obvious than giving a poor person money - that building comprehensive public social systems is the long-term answer, even if that's a much harder road to follow".
"Rather than leaving each person to fight for themselves in deeply constrained economies, legal systems, and societies that make it almost impossible for that person to succeed, we should commit to building systems that take care of a whole person, not just the aspect that is most easy, convenient, or 'cost-effective' to address. The biggest lesson from this book is that it's important to question how viral stories are constructed and consider the political, economic, and historical forces that inform them and shape individuals, institutions, and policy fads".
THE END OF REALITY The end of reality? Taplin cites the 44% of US voters who believe "the Federal government is controlled by a secret cabal". But it is kind-of true, you can understand people saying "yes" when the surveyor called, given the obvious influence of all those billionaires. And the Democrats are so bad, you can understand support for Trump.
But Trump and the four billionaires of the title - Elon Musk, Peter Thiel, Marc Zuckerberg, Marc Andreessen - are funding America's drift toward fascism, so we have to pay attention. They fund the campaigns of authoritarian Senate candidates, back Trump for President, run Rightwing think tanks, and who knows what else.
Taplin is blunt about their future: "I have no doubt that if Trump returns to the Presidency, we will see a forcible suppression of the opposition as we have never experienced in this country". But he also offers some optimism, because there are signs that realism might be winning out. Not so many people want to pay $US500+ for a Meta headset.
Social Media
All four technocrats have played key roles in developing today's social media, which reaches about 80% of the US population. Musk alone has 112 million followers reading his tweets. The tech moguls' big-ticket projects include:
Taplin starts with the obvious question: "why we, as a society, would invest $US20 trillion in fantasy worlds (Mars, crypto, the Metaverse) when real-world solutions to the critical problems of our planet are currently available?" The answer emerges through the chapters of his book: all four want to keep on extracting monopoly profits from citizens and Governments while avoiding taxes. They have a plan to stay the richest people on the planet.
Facebook's gross profit margin (net sales income less cost of production) is 80%, Microsoft's is 70%, Google's is 53%, Amazon's is 41%, Apple's is 38%, compared to Walmart's 24%. Facebook and Google get their users to create content for free; Microsoft and Apple's biggest expense was writing the original code, now distributed free on the Internet. So, most of the richest men on the planet are involved in software in one form or another. Their excess profits created the rapid rise of tech wealth, by reducing the amount going to wages and middle-class savings.
Musk Owns X (Formerly Twitter)
Musk now owns X (formerly Twitter), and openly backs Trump. It's hard to assess how powerful the backing of X is, but look back at Musk's Tesla for example. For its first eight years Tesla's stock was worth about $US70. In 2018, Musk took to Twitter up to 20 times a day and accumulated 80 million followers; by 2021 the stock was $US1,144. Researchers have since found that a large share of those "tweets" were automated "bots", programmed robot posts. How is that legal? Only in the United States. I picked Trump to win, thanks to the hidden power of social media promotion.
Musk bought Twitter in a hostile takeover, after lobbying from other so-called "libertarian" technocrats - including Peter Thiel, who was keen to get Trump back on Twitter. He overpaid, the stock tanked and he spent months trying to get out of the deal. Then Musk promoted his takeover as a blow for freedom, so America's Right immediately jumped in to test the limits of this new freedom to distort public information. Use of the N-word on Twitter increased 500% in the 12 hours after his purchase. Musk is right up there with the conspiracy nutters, tweeting after Nancy Pelosi's husband was attacked with a hammer: "There is a tiny possibility there might be more to this story than meets the eye".
Verification as a legitimate Twitter user became the payment of $US8 a month, which the trolls took full advantage of. Lockheed appeared to announce it was pausing weapons sales to Israel, Saudi Arabia and the United States appeared to call for a human rights investigation; Chiquita announced it had overthrown the government of Brazil. Advertisers departed, and Musk's financial problems escalated.
Don't take that as a good thing though. Maybe Musk's original plan - encouraging corporate compliant Government - is now more important to him. Taplin's summary of social media: "At both the elite and the mass levels, American society has devolved into a sort of permanent adolescence, characterised by rage, relentless social media self-promotion, a lack of impulse control, and delusional fantasies about how the world actually works".
He also makes clear that the Democrats too had a hand in creating this mess, with lobbyists convincing Clinton to add the "Safe Harbour" liability shield into legislation, stating: "No provider or user of an interactive computer service shall be treated as the publisher or speaker of any information provided by another information content provider". This single sentence allowed sites to steal others' content without paying, destroying the newspaper industry, and allowed Facebook, Twitter, YouTube, and other social networks to create the modern disinformation economy without fear of being sued.
And desperate for funds to re-elect Clinton in 1996, the Democrats turned to Silicon Valley and Wall Street for funding. They were pressured into overturning the Glass-Steagall Act, created after the Great Depression to keep commercial and investment banking separate. Fast forward to 2008 and the bank bailouts in the US-created global financial crisis. Taplin quotes "fairly good evidence that Trump used Facebook in 2016 to suppress the Black vote with ads targeted at Black voters claiming that Hillary Clinton called young Black men 'super predators'". There was a dramatic decline in the Black vote, from 66% in 2012 to 59% in 2016.
Online gambling is increasingly being legalised at state level in the US and growing rapidly, another way to monetise online addiction. And at a more general level, these technocrats simply have no respect for labour because it's not a big part of their business model. They've pushed for so many tech research and development (R&D) tax breaks that the tax rate on computer spending is near zero, while the tax rate on staff is 25%. No wonder they back AI (artificial intelligence) to do away with more of us.
Crypto
Crypto's value fell about 70% in the year since November 2021. Whales (the rich) own most of the stock, but at the height of this ponzi scheme they will offload. A 2021 poll also found 23% of Black Americans owned crypto, compared to 11% of white Americans, thanks to online marketing by Black sports stars. Bitcoin automatic teller machines (ATMs) are largely sited in the poorest neighbourhoods.
And considering sustainability, a single transaction on the Bitcoin blockchain currently requires 232 kilowatt hours (kWh), the power consumption of the average US home over seven days. Bitcoin currently uses as much electricity as the Netherlands. Taplin: "The only people who really need crypto are criminals".
Thiel, Andreessen, and other technocrats are lobbying politicians hard to keep crypto unregulated. They have hired former Securities and Exchange Commission (SEC) Chairman Jay Clayton and former SEC counsel Elad Roisman as lobbyists. A Democratic Congressman Ro Khanna is advancing a bill asserting that cryptocurrencies are not a security and therefore ineligible for regulation by the SEC. Wyoming Senator Cynthia Lummis has taken control of writing a crypto regulation bill which classifies crypto as a commodity like corn or oil, placing it under the Commodities Futures Trading Commission, much smaller than the SEC. Etc...
Taplin again: "Ultimately the computer scientists who wrote to Congress in the spring of 2022 asking for strict regulation on crypto were correct: It is a technology that is not built for purpose and will remain forever unsuitable as a foundation for large-scale economic activity. As long as we continue to say: 'It's early and some day we may find a purpose for cryptocurrency', we are just postponing the inevitable destruction of wealth".
Going To Mars
Let them go, they may not come back! The obvious is true about this technocrats' fantasy. What sort of idiot could fool themselves it is economic to mine or live on Mars? What this is really about is getting a private share of the lucrative military budget. SpaceX has now achieved this, elbowing out earlier private companies like McDonnell Douglas to dominate the new space race.
To be clear, Musk wants the taxpayer to fund his project, not the promotion trips for rich listers. After Russia invaded Ukraine, Musk pointed out that the Atlas rocket used Russian engine parts (who knew?). SpaceX lobbyists got a bill capping the number of Russian-made engines the Air Force could buy, forcing the Pentagon to make a deal with Musk which now provides most of the funding for SpaceX.
Taplin's Solutions
"I'm suggesting not so much an active revolt against the technocrats as a sort of benign neglect of their agenda. Ignore the Bitcoin hype. Log off Facebook, Instagram, and Twitter. Don't even think about Donald Trump, Kanye West, Elon Musk, or Tucker Carlson. They are not important to the real lives of your family and friends. Part of our task is to stop thinking there is a technological solution for every problem and to honestly ask why we are acting like sheep around Elon Musk and Donald Trump? It is time to 'slow down and repair things'".
"On the one hand we have the abandonment of reality in the executive suites of the companies controlled by the technocrats. On the other, those companies are feeding a populist counterrevolution that threatens the very basis of our democracy. The reality in our current world is that huge transnational digital firms dominate the global economy because we allowed them to be monopolies from the start. The survival of big extractive firms relies on regulatory capture, the ability to corrupt the institutions that might keep them in check. Many people are realising we need a new economic philosophy to replace the brain-dead neoliberalism that has created our current hellscape".
"The technocrats' project has two dimensions. The first is commercial and cultural: buy that Meta Quest 3 virtual reality helmet or invest in crypto. I sense that the market will make the ultimate decision on these projects. Meta's management has a tool it calls the 'dogfooding dashboard', which measures whether the dogs (customers!) are eating the dog food (spending time in the Metaverse). So far, the results aren't good".
"On the other hand, the political project of Thiel and Musk (with the acquiescence and financial support of Zuckerberg and Andreessen) will not respond to market disciplines. The battle between the authoritarians and democratic forces is a fixed game in which the small rural red states have outsized influence (because each state gets two senators) compared to their populations. The hold of the far Right is only going to increase because of a decision made 234 years ago".
"Trump and the promoters of Qanon are pulling in millions of dollars in donations for this fantasy war for freedom. This in turn fattens the wallets of people like Zuckerberg and Musk (along with their shareholders, like Thiel and Andreessen), who profit from the hate. And if their political project succeeds, then their commercial interests, dependent on Government funding - space exploration, autonomous weapons systems, and transhumanist research and development - will benefit as well".
"In the face of this, there are only two strategies: resistance or submission. I think families can have honest discussions about the future, and those who want to join the resistance could adopt some simple guidelines for their families: don't buy a virtual reality (VR) headset, don't let your children use VR; don't buy crypto; don't let your tax dollars finance a Mars space colony".
UNDERGROUND EMPIRE Back in 2012 there were only three major telecommunications equipment providers in the world - Ericsson, Nokia, and Huawei - each with between 15 and 30% of the market. All the big American telecommunications manufacturers were dead or had been sold off, victims of global competition. Huawei, a Chinese company, had built itself up by providing low-cost contracts in the developing world, an approach to market competition that didn't appeal to Western corporations. As the West moved towards implementing the new 5G (fifth generation technology) standard, Huawei seemed poised to rebuild the world's telecommunications systems.
Back in America though, Trump was talking tough on bringing jobs back home to win votes, and corporations were looking more closely at their supply chains. Around the world, covid disruptions were emphasising that strategic economic and military autonomy were becoming more important policy considerations. Trump ramped up US sanctions and other economic tools to deny Huawei access to American markets, arguing access could potentially allow "communications to be disrupted, intercepted, tampered with, or purposely misrouted" by the Chinese military.
Trump had already worked with the Dutch government to stop ASML, which makes the ultraviolet lithography machines needed to produce semiconductors, from selling high end machines to China. In 2022, the Biden Administration pressed ASML to stop exporting even older machines too. ASML made it clear it didn't want to cooperate. In a call with investors, its Chief Executive Officer (CEO) warned that the world "cannot ignore the fact" that Chinese chip manufacturers feed world markets. If the US blocked China from making less advanced chips, it might significantly disrupt the world economy.
Pulling A SWIFTy
Trump's Administration also pushed to remove Iran from the Society for Worldwide Interbank Financial Telecommunication (SWIFT) for a second time, forcing Europe to the extremes of creating an alternative and complicated barter system to avoid any relationship with the US dollar. The system delivered just one transaction, helping export medical goods to Iran in 2020, which emphasised the impotence of Europe against rising US economic warfare.
Germany's Foreign Minister, with the support of France's Foreign Ministry, commissioned an arms-length report by a think tank including how Europe might retaliate against US coercion, targeting American banks and businesses by freezing their assets or removing their licenses to operate in the European Union (EU). These were radical suggestions, intended more to create counterpressure.
Under Biden in 2021, the US Department of Commerce demanded and got sensitive customer information from Taiwan's major chipmaker TSMC, which eventually folded to US pressure and ceased sales of high-end chips to China. TSMC was further forced to shift some production to the US to allay US fears that a Chinese takeover could impact supply of high-end chips essential for military and intelligence systems.
Morris Chang, ex-CEO, commented publicly that "those good old days when we can serve everybody in the world, those good days are gone. I just hope that they don't get any worse". He had worked first in the US, including Texas Instruments, where he saw Japanese outsourcing outcompeting US plants. His comment on US efforts to bring chip production home:
"The US government's efforts to increase onshore chip manufacturing by spending tens of billions of dollars would be a very expensive and wasteful exercise in futility, the US would increase onshore semiconductor manufacturing somewhat at a very high cost, high unit costs, and non-competitive in the world market to compete with factories like TSMC".
NSA Stealing Secrets
During this time the National Security Agency (NSA) also escalated, from demanding secrets from US technology companies to stealing them via their back door entry at fibre-optic connection points. In response, companies like Microsoft and Google started encrypting the information that flowed from one data centre to another. Google even encouraged other companies to do the same, when it downgraded non-encrypted Websites in its search results.
And the global system of fibre-optic cables which connected the information economy began to change. Chinese companies like Huawei joined the consortia laying down alternative underwater cables, many of which didn't converge on the old centres of the network in the US. And Google and Microsoft laid their own private cables.
The authors conclude that "firms like Google didn't have as much to gain from collaborating with the US government as AT&T and its sisters (traditional telecommunications) because their core business wasn't as vulnerable to US regulators. That said, the US government could get its way, for example blocking a Google cable from landing in Hong Kong in 2020".
And this section on Trump's (first) Presidency is worth quoting in full: "After Trump was finally dragged out of office, the Biden Administration seemed better placed to avoid mistakes. It would talk to its allies in advance. But officials in the new Administration had paradoxically taken heart from Trump's errors. Before Trump, they had feared that the overuse of US power would completely alienate allies, radicalise adversaries, and push businesses to work around the choke points. The Trump years suggested that their cautions were largely misplaced. Perhaps mistakes wouldn't undermine US power".
"Trump had been both brutal and incompetent. His officials had pushed an extreme view of US power, harshly punishing key allies and threatening to sanction their officials. Not only had they dismantled Huawei and threatened European governments with dire consequences, but they caused international uproar by designating International Criminal Court officials for investigating alleged war crimes by US soldiers in Afghanistan. The designations didn't just affect the officials: Trump's Secretary of State, Mike Pompeo, threatened sanctions against businesses or individuals who supported them in any way. The new Administration would forgo Trump's vicious stupidity, but it wouldn't fret much about overreach".
The authors talk bluntly about Trump and Biden's desire to disentangle the US economy from China's, and their concerns about potential residual leverage of China on supply chains through rare earth metals. "Biden, like the Trump Administration, increasingly saw economic warfare as the first best response to China's inexorable rise".
Matt Duss, Bernie Sanders's foreign policy advisor, told the authors that American politics had become a "competition of who's tougher on China, generating new ways to weaken China: ramped-up technology export bans, a crackdown on Chinese investments, stringent disclosure requirements for Chinese firms that want to sell shares in the US". This time, the target wasn't a single firm like Huawei. It was China as a whole. Chinese officials were shocked when the US not only cut Russia out of the world's financial transaction system, SWIFT, but froze the half of Russia's currency reserves held in the West, about $US300 billion. The hold on that $US300 billion is still in place.
The Risks Of Hidden Economic Wars
Thanks to recent authors like these, and originally thanks to Snowden and Wikileaks, we now have a clearer idea of how the US wages these undeclared economic wars. Their US-first approach includes planned restriction of China's economic development and disregard for the impacts on businesses based in other Western nations.
The authors of "Underground Empire" highlight the risk of unexpected consequences; global economic warfare was a significant contributor to the Second World War. But they are optimistic that getting this issue out in the open will increase policy discussion, encourage more consultation and lead to more careful economic interventions. Others outside the US will still be concerned that the use of economic warfare will continue to escalate.
THE JAKARTA METHOD This is the best political book I've ever read. "The Jakarta Method" covers a grim time in global history, but it's also uplifting because it brings back the lives, hopes, dreams and eccentricities of Third World activists from obscurity, where Western media left them to preserve America's public lies. After moving to Jakarta in 2017, Bevins spent years seeking and interviewing survivors of military murder campaigns to gather their experiences, to spell out the terrible consequences of Central Intelligence Agency (CIA) and US government support for military repression in developing nations.
He came to the conclusion that the entire world, and especially the countries of Asia, Africa, and Latin America, has been reshaped by the waves emanating from Brazil and Indonesia in 1964 and 1965. These events and their repercussions - that is, the global extermination network they engendered - was part of the wider story of the Cold War.
The Third World
This is the forgotten story of the "Third World", a phrase which has been sidelined because it evoked a new non-aligned force in global politics, independent from the Cold War First World (the West) and the Communist Second World. It's the story of people freed from colonial tyranny after World War 2, and their many successes - before America encouraged, incited, funded and armed military elites in Asia, Africa and South America to align with the US corporate agenda, to murder their own people for personal gain. It's the American Way, holding the rest of the world back in the interests of US corporate and military dominance.
Thanks to Wikileaks, declassified documents and Bevins' interviews, we can now see the full pathology of the CIA's secret post-war programme of political murder across the developing world, an agenda which built on the techniques of Britain's earlier military and social war on its colonies (see my review of "A Legacy Of Violence", which I reviewed in two parts in Watchdog, issues 165 and 166, April and August 2024).
I won't cover here the detail of US covert programmes in Brazil, Indonesia, Chile, etc here, because you can read my full review of "The Jakarta Method" online in Peace Researcher 68 (November 2024). Broadly, the CIA relied more on organised murder campaigns and arranging compliant military rulers, compared to Britain's earlier use of vast colonial concentration camps and torture. Then, after a few failed coups like Cuba, the US learned to prepare more carefully for its takeovers, building "A State Within A State" in Indonesia by funding the military's expansion into economic extraction in fishing, farming and forestry, a sure way to cement in corruption.
The Long-Term Consequences
Bevins: "How did the US anti-communist crusade affect life for billions of people today? In 1965, (Indonesia's) Sukarno and much of the rest of the Third World came together with the intention of changing the relationship between the First and Third World. They believed that after centuries of racist colonialism, it was their time to take their place in world affairs as independent nations, to assert their power and intelligence and potential, and to rise as equals".
"It's now probably broadly accurate to say that all of Latin America, with the exception of Cuba, consists of crony capitalist nations with powerful oligarchies. Anti-communist programmes (also) deformed the world socialist movement. Many of the global Leftwing groups that did survive the 20th Century decided that they had to employ violence and jealously guard power or face annihilation".
"The major losers of the 20th Century were those who believed too sincerely in the existence of a liberal international order, those who trusted too much in democracy, or too much in what the United States said it supported, rather than what it really supported. That group was annihilated. Fanatical anticommunism has never really left us, even in the First World. This violent, paranoid style in politics remains a very potent force".
Big Questions
Because this historical story is told so thoroughly, it also raises big questions about today's world. How can we protect future whistleblowers like Snowden, who leaked many of the key documents? How can we constrain and reduce spies, military and paramilitary forces? How do states protect local producers against predatory global corporations?
Which forms of political organisation can survive and thrive against the combined forces of local authoritarians and international secret services? What might new forums for non-aligned nations look like? Now that the world is dominated by the US First World and its neoliberal followers, with a Third World of nations mostly stuck under authoritarian-military alliances, a revival of an independent and cooperative Third World is just what the world needs.
GHOST SIGNS When covid struck in early 2020, librarian Stu Hennigan volunteered to deliver food parcels to vulnerable people in Leeds who were self-isolating and had no other access to food during the first lockdown. Going door to door he recorded stories of the pandemic and the poverty he saw. This is a book that's best shown by a series of snippets from the author:
"The last drop of the day is at a nondescript row of terraces, a bit shabby but nowhere near as bad as some of the wrecks I've been driving past today. This time the house is quite grubby and the front door has been kicked in. I can hear whispers behind the door when I knock and I think no one's going to come, but it opens a crack and they're delighted when they realise who I am. They are two ladies in their fifties, skinny as you like, with furrowed faces that tell of lives lived in the margins".
Doorstep Lending
"Both of them are smoking greedily and look frightened, harried. I don't know who they were waiting for but it seems like it was someone far less pleasant than me. There's a significant problem in some areas of the city with doorstep lending, so maybe they've been expecting someone round to collect a debt? Whoever it is, it doesn't seem like it's going to be a happy occasion when they arrive".
"'Bloody hell, love, you give us a shock there, didn't he, eh?'' one of them says, clutching onto the other's arm with a scrawny claw. They're both breathing heavily and they look nervous, laughing the kind of laughter that could easily tip into hysteria. It's clear that they can't wait to get back inside, eyes darting round in panic".
"There are a lot of police around in Harehills today. It's hard to see what they can do; even if they break up the groups of people that are congregating on street corners, there's nothing to stop them reconvening once they've gone, and judging by the amount of Fuck The Police graffiti, it's a fair assumption that respect for the law isn't as high as it could be in this part of the city".
"The streets here are swimming with litter, and there must be an unimaginable number of rats. I've noticed that the Council have taped bags around the tops of all the litter bins in the city to stop people using them during the pandemic, presumably to save over-stretched staff from having to empty them. That's not had any impact whatsoever on the litter situation around here though - Harehills always looks like this".
Bevins: "I head straight out with another sheet, featuring a couple of meds drops. I have to wait a little while before I can get into Boots (chemist) so I stand in the queue, taking it all in. A handful of people are wearing masks. One thing that really strikes me is the silence. No one is talking, not even the couples who have come out together. I can hear engine sounds from a few cars, the click of doors opening every time someone enters or leaves Boots, but otherwise there is just a quiet, lingering unease".
Grateful For Meagre Food Parcels
"The first drop turns out to be Roundhay, another example of the pockets of deprivation that can be found even in the wealthiest areas of the city. There are broken doors and windows in lots of the flats, glass and rubbish everywhere. There's a stench of butane in the air when the door opens, and the young woman who answers is quite clearly off her head. She's a skinny little thing, with short dark hair, hollow cheeks and piercings in her lip, eyebrow and nose, wearing a dirty white vest and army pants. I show her the name on the job sheet - which is male - and she jerks her head. 'He's asleep on t'sofa innit. Shall I wake him up?'' 'Nah. Got you some food parcels, that's all'".
"The bloke who comes out is in his fifties, Leeds United tattoos on his arms, workman's hands and a deep, smoker's voice; a proper Loiner. I make a joke about what a pain the house was to find and he sympathises. 'No one can ever find us here, kidder. Which bit of Leeds are yer from?' I tell him, and it turns out he works for a company about half a mile away from my house".
"He says some of the lads are going back to work next week and he's hoping he'll join them the week after, but he's not been paid while he's been off and they've run out of food. Chancellor of the Exchequer Rishi Sunak is on record as saying people are becoming 'addicted' to being furloughed and that he is looking for a way to stop making payments already. As I'm getting back into the van, I hear him laughing and shouting up to the woman in the flat: 'Fuckin' hell, Kelly, wait till yer see what they've sent us!' The reaction to what's in the parcels - teabags, biscuits, cereal, some beans, a bit of fruit and veg - is an indicator of how desperate some people are".
"Another thing that's really struck me about the last few weeks is how instinctively conservative many people in this country have proven themselves to be. Social media is awash. There is a lot of talk about how lockdown measures haven't gone far enough, but this seems like a dangerous road to go down. I understand the seriousness of the situation, but there's something deeply disturbing about a situation where people complain the Police haven't been given enough powers to make them stay at home".
"It's a tough evening at home. My son has been getting more and more unsettled, so today my wife tried to cheer him up by arranging for him to have a Skype call with one of his best friends from school. He's having a lovely time chattering on about 'Beast Quest', but as soon as the call finishes the poor little man is in bits, crying and complaining that all he wants to do is go back to school".
"On 15th May, the British Medical Association announces its support for teaching unions who claim that reopening schools on 1st June is unsafe. The Children's Commissioner for England says the Government and teaching unions should 'stop squabbling and agree a plan' to get children back to school, claiming that disadvantaged children are suffering as a result of schools being closed. The week ends with an increase in deaths of 170 - the lowest daily total since lockdown began".
So Little Help Available
"I pop the bags down on the floor and she launches into a spiel about how terrible it is for everyone who's living through this war - and I know it's a nuclear one, she says - and how angels like me have restored her faith in humanity and given her a completely new outlook on life. I've no idea what she's talking about but she's so sincere".
"Back in the van, I'm in bits. This woman needs more than food, but there's so little help available. So many support services have been lost as a result of brutal cuts to local authority budgets, and many people have been allowed to fall through the net". The Leeds Food Distribution Centre finally closed its doors in September 2020, having been operational for 23 weeks, packing and delivering almost 63,000 food bags to homes.
FILM REVIEWS This truth-based film is a political eye-opener. The greedy CEO of a French nuclear power plant manufacturer knowingly sells its technology to a Chinese joint venture, allowing theft of the design and technology. Short term profit (and likely kickbacks) trump long term sales, with jobs cuts inevitable. When the union negotiator Maureen Kearney calls him out, heavy handed legal and police intimidation follow, anonymous phone threats, then a home invasion and assault by thugs-for-hire.
Kearney was tied to a chair, had the letter A* carved into her stomach with a knife, sexually assaulted and left blindfolded, believing she was bleeding to death (*Areva was the French nuclear corporation Kearney had publicly outed). But the State's follow-up is equally shocking. Politicians, including President Sarkozy, dismiss her - a mix of burying political bad news and sexism. The police and court system attacks her as deliberately staging the assault. Unbelievable. To escape the pressure, Kearney admitted those charges, then recanted four years later after recovering.
Do the police and courts act to align with the clear desires of political and corporate leaders, or are they actively encouraged? It is clear that the French court style, with a dominating investigator rather than lawyers acting for and against, facilitates this. The police are shown as chronically chauvinist, to be expected in a country with much experience in crooked colonial policing.
A Blunt Reminder
This film is a blunt reminder we all need to pay more attention to the growth of paramilitary-style policing. The West has been living comfortably off exploitation of poorer countries, quietly accepting US-led interventions for authoritarian governments in places far enough away to ignore the human suffering which results.
Today, you can see this quietly coming home to roost. When you have thugs like these for hire - likely ex-military or ex-covert ops psychopaths - they don't go away. They will seek out partnerships with anyone who needs bad news disappeared. Officially tolerated standovers and intimidation could easily become part of the US under Trump, or anywhere else. The film, and its true story, is particularly effective at making very clear how difficult it is to be a corporate whistleblower today. The men who perpetrated the real-life sexual assault on unionist Maureen Kearney, and another remarkably similar case of assault to intimidate, still have not been identified.
Isabelle Huppert is brilliant in the main role of Kearney, well supported by Gregory Gadebois as her supportive husband when their life is turned upside down. Recommended viewing. The national variation in mainstream film reviews was revealing too. Australian papers praised it; the UK Guardian missed the point, headlining it "French sexual abuse thriller takes cheap shots" and summing it up as "a political thriller that tells the story matter-of-factly, and is perhaps a little lacking in the pace department". Wake up. Corruption is taking the world down the toilet and they're talking about pacing, when a rare, important and high-quality political film gets made. Most US media outlets preferred to ignore the film.
How does a music-movie review get in Watchdog? Easy, because this is a film which portrays, and celebrates, our own independent Kiwi culture (oddly, it also shares some of its style with the very different movie about Trump reviewed next). "Head South" is a gritty Kiwi movie about the Christchurch music scene in 1979. Finally, a music-driven movie which keeps all the real stuff in the mix - sexist men, pretentious musicians, exploitative drug dealers - and wild music which sounds like it might change your life. It's both fun and real. Quote from Angus's older and (sometimes) wiser dad: "Better to regret the things you have done than the things you haven't done".
Don't Be Seen As A Wanker
Our local band scene is the background to what we lived through, the messy real-life story of growing up in changing times. For male lead Angus, his school friends are surfers but also thugs on their bad days, while his brother sends back unobtainable records from seemingly exotic London. His mum is playing out a version of 70s' US "sexual freedom" by disappearing for two weeks with a man who has a cooler convertible than his dad. Starting a band might just be an escape plan for Angus.
This is not just a boy's story though. Stella (local musician Benee) is a great foil to Angus's dream of starting a band before he can play a note. She works in the local chemist and actually owns a guitar, writing her own songs. A black-and-white photo montage starts the film, recalling the grungy flats and venues which were the backdrop to local alternative music. It takes you right back to those years by recreating the look of old Super8 footage, flashes of light creeping in from the edges. I saw this film straight after the Trump biopic "The Apprentice". Both films have a look of grainy realism, reminding us we grew up in a simpler world that was very morally messier than we chose to remember.
This looking-back-darkly approach highlights the disjunction between what was really going on back then, and what our young selves naively saw, busy as we were trying to get by in a world that we were nowhere close to understanding. The theme of how to be authentic is always in the background - generally expressed by Angus as a desire not to be seen as a wanker! They're both great movies, but Trump's world is a disturbing morals-free pursuit of power and wealth. "Head South" is a much more relatable look back at young people growing up. You'll know if it's for you if you enjoy the excellent trailer.
This is the story of Trump as a young adult, how he found his way into the corrupt side of US life and learned from king-of-sleaze lawyer Roy Cohn, brilliantly played by Jeremy Strong. Cohn's three golden rules (and that means, rules to get the gold) are 1. Attack, attack, attack 2. Admit nothing, deny everything 3. No matter what happens claim victory and never admit defeat. Which in the context of US property development back then, and US politics now, translates to "lie, lie, lie".
To cut to the chase, this is a very effective movie, but both the human and political tales are a grim watch. I recommend it but didn't enjoy it, leaving the theatre feeling quite disturbed. My conclusion was we need to pay much more attention to US dirty tricks, and face up to US politics being little more than a propaganda front for rich corporations.
None of their "representative" mouthpieces, Democrat or Republican, gets elected without support from global social media and Internet moguls. We're definitely going to need WikiLeaks back with this thug nominally in charge of the US, while the tycoons who funded him to get there again call the shots. On the plus side, no more illusions about the vocal world of US economists and thinkers. It was all a con.
Thug & Misogynist
Anyway, back to the film. The story starts with a voiceover and dark screen, an American politician is talking about his life of public service in a well written speech. Then the video is added and we see the speaker was Nixon, reading the prologue to his infamous and ultimately unconvincing "I'm not a crook" speech. Remembering all of Nixon's bugging and dirty tricks provides the perfect backdrop to Trump's rise, as he learns all that and more from master political manipulator and blackmailer Roy Cohn. And the realistically filmed dirt and decay of 1970s' central New York provides the perfect backdrop.
It's definitely an outsider's view of the US, made by Iranian-Danish director Ali Abbasi. Through the movie you see Trump become a thug and misogynist, while Cohn has humanity forced on him as first his partner, then Cohn, succumb to Aids. It's not just a boys' movie though, with Trump's first wife Ivana getting a fair share of screen time.
Ivana's divorce included an allegation that Donald Trump raped her. For a 1993 book on Trump, author Harry Hurt obtained a copy of her sworn divorce deposition from 1990, stating that her husband raped her in a fit of rage. In Hurt's account, Trump was furious that a "scalp reduction" operation he'd undergone to eliminate a bald spot had been unexpectedly painful, with the plastic surgeon recommended by Ivana. In retaliation, Trump yanked out a handful of his wife's hair, and then forced himself on her sexually.
Hot Potato
Trump has denied both the rape allegation and the suggestion that he had a scalp-reduction procedure. Hurt said that the incident was confirmed by two of her friends. Intuitively, you'd think it's true. Making legal allegations this blunt isn't normal in the world of the ultra-rich. When Trump was one of three Republican Presidential candidates still in the race, Hurt asked Norton to reissue the book. Word came back that the publisher's lawyers had deemed the book "too dangerous to publish", while Norton said publicly it had made "a business decision."
Hurt decided to scan the book and reissue it himself online. When a reporter for the Daily Beast began making calls about the rape allegation, Michael Cohen as Trump's lawyer called him: "You write a story that has Mr Trump's name in it and the word 'rape,' and I'm going to mess your life up ... for as long as you're on this frickin' planet". After that, Hurt said, CNN booked him four times but kept cancelling.
After its Cannes showing, mainstream distributors refused to touch "The Apprentice". Eventually, small independent player Briarcliff Entertainment acquired the film, needing a fundraising campaign to: "Keep the film in as many theatres for as long as possible". Now Trump is again US President. What a bullshit country.
REVIEWS
- Linda Hill THE RACKET This is a book that tells it like it is. Highly recommended. As a Financial Times reporter in London, New York and Washington, Kennard had access to the global elite. Many were amazingly frank about the "war on drugs", the "war on terror", global capitalism and the US's role in the world. But what he learned would never be published in "their house organ", the FT. He realised, in fact, that "eyes wide shut" ideological training had been part of his Masters in Journalism course at Columbia University.
After four years, he left FT, joined the Centre for Investigative Journalism in London and wrote "The Racket" (Zed Books, 2015). He and Claire Provost followed this with "Silent Coup" on how Britain turned its colonial empire into a financial one (see my review in Watchdog 164, December 2023). He then co-founded and reports for UK Declassified, an online media outlet focusing on British foreign policy. The 2024 Bloomsbury edition of "The Racket" includes a new preface by Kennard1 and a strongly endorsing foreword by Chris Hedges, US political commentator and former war correspondent.
"A Gangster For Capitalism"
Kennard's title references a much-decorated Major General in the US Marines, Smedley Butler, who in 1933 described himself as "a muscle man for Big Business, for Wall St and the bankers... a racketeer, a gangster for capitalism". He also quotes a self-described "economic hitman" for corporations, John Perkins, telling Democracy Now! in 2004 that: "We've built the largest empire in the history of the world... primarily through economic manipulation, through cheating, through fraud, through seducing people into our way of life". Kennard provides an excellent account of how the racket works, how the US State operates in the service of its global business interests. "The politicians are a product of... the corporate behemoths that are devouring society and all its assets".
Back in 1823, President Monroe told other world powers to stay out of the resource-rich Western hemisphere, which became the US's "backyard". After WW2 the US gained global power to pursue its capitalist interests through its control of international institutions: the International Monetary Fund (IMF) and the World Bank with their "foreign aid", loans and structural adjustment requirements; "free" trade agreements like the General Agreement on Tariffs and Trade (GATT), the North American Free Trade Agreement (NAFTA) and the World Trade Organisation (WTO); the power of veto and funding in the UN; North Atlantic Treaty Organisation (NATO), military support and huge arms sales for proxy wars and "the war on terror".
And through its own international agencies: not just the Central Intelligence Agency (CIA), but the Drug Enforcement Administration (DEA) fronting bases and covert activities throughout Latin America in the "war on drugs", and the US Agency for International Development (USAID), the National Endowment for Democracy and US embassies supporting coups and opposition elites, as revealed by WikiLeaks and Freedom of Information documents. Kennard reports on such US operations in the 2000s and early 2010s in Honduras, in Mexico and its independent Zapatista areas, in Colombia and Ecuador, in Venezuela under Chávez and Maduro, in Bolivia under Morales, and other countries where democracy was getting "out of control".
Haiti
He begins with a devastating example: Haiti. I'd call it both "shock doctrine" and "disaster capitalism". Haiti was a sugar colony that threw off French slave masters in 1804, but was forced to compensate them with a debt that never ended. After 200 years, Haiti's popular President Aristide asked France to refund $US21+ billion. A coup promptly followed, in which Aristide was whisked off to Africa (not Miami) by the US military, and the UN brought in 5,000 military and police to "stabilise" the country - until 2019.
The 2010 earthquake killed 300,000 people, then 9,000 died of cholera introduced by UN peacekeepers from Nepal. Kennard recounts how the IMF and World Bank took over Government, assisted by USAID and the Inter-American Development Bank, and installed a "Chicago boy" President. They privatised State-run assets and infrastructure, gave reconstruction grants to US companies and expropriated farm land for export processing zones of garment sweatshops, with tax-free deals, no unions and wage rates half those in the neighbouring Dominican Republic.
As well as moving profits off-shore, this undermined local businesses and Government revenue for welfare services and rebuilding public institutions. The UN's latest Stabilisation Mission has just been extended till October 2025. The merit of UN interventions and governance can be measured by reports that Haitians in Port-au-Prince are currently at "critical risk of starvation" (al Jazeera 30/9/24, 2/10/24).
The US: Textbook Case Of An Unequal Society
Kennard also reports on the US's home turf. He was based in New York and Washington after Obama and the Federal Reserve bailed out the banks responsible for the Global Financial Crisis (GFC) - clearly a racket. The money market boom, up until 2008, comprised speculation rackets built on a subprime mortgages racket.2 Kennard participated in Occupy Wall St protests in 2011. He reports on the impacts on ordinary Americans of mortgagee (sic) rescue packages, public housing cuts, time-limited unemployment insurance, and other austerity policies.
In 2010 the top tier of US earners was recovering, but the proportion of population living below the poverty line had risen to 15%. These are disproportionately Hispanic and Black, and include nearly a quarter of all US children. As Kennard relates, manufacturing and heavy industry corporations had moved many jobs off-shore to exploit other countries' resources and cheaper labour. In the 1950s a third of the US workforce was unionised; by 2005 it was 12%.
As the remaining parts of the productive economy tanked with the GFC, more layoffs forced concessions from unions. Between the 1970s and 2009, the median wage for US males dropped 28% in real terms. It's not surprising that so many want to fire the Establishment. Now, it's the US's own democracy that is out of control, with no socialist leader left to vilify.
Profitable Prison Industry
Since the 1970s, the "war on drugs" has been fought across the US as well as across Latin America. Kennard sees this as a means of social control, targeting Hispanic and Black neighbourhoods in particular, and contributing to the world's highest imprisonment rates. Over the 20 years to 2007, nearly 10% of US adults have experienced prison. It is also a privatisation racket. In 2010 7% of all state prisoners and 17% of federal prisoners were in private prisons, with pressure to privatise picking up again.
Kennard interviewed state senators and investment analysts about this "penetration of the market", and concludes it is driven more by political patronage than purported cost savings. The US prison market is now dominated by two large players, the Corrections Corporation of America and the GEO Group. There is no question, Kennard says, that private prison companies strategically support and recruit politicians who will increase incarceration. At the same time, Government spending cuts are severely affecting workloads and wait times in both the state and federal justice systems.
To be profitable, private prisons prefer healthier inmates jailed for less serious crimes, requiring lower guard/prisoner ratios and less experienced officers. Some states were encouraged to fund building bigger private prisons than needed, then bid for federal prisoners. But if break-even capacity was not met and maintained, the prison management company dumped its contract back on the state. I see the peaceful Northern Marianas is currently offering empty prison beds to other jurisdictions. I guess if our own tough-on-crime politicians do fast-track and "future proof" Paremoremo by doubling its size, we can always invite over some more 501 deportees from Australia.
Arab Spring
Kennard's last stories are from Arab Spring countries, where the US was promoting "Western values" and interests, "the most consistent Western value... to support dictators' with military aid". Street battles were won that spring but not the war, as the US and Bretton Woods institutions adjusted their alliances to the new regimes, with little change in economic policies.
But activists told Kennard that WikiLeaks helped Tunisians realise how corrupt their oppressive ruler was. Another in Egypt told him that the politicisation leading to strikes and the Tahrir Square sit-in derived from the Palestinian intifada ten years earlier and grassroots organising. With the US so overtly backing Israel's current genocidal reprisals on Gaza and Lebanon, that consciousness won't go away.
The US and its agencies promote, or organise by other means, democracies that are "tamperproof", Kennard writes. A political order in which electors, grateful for a few civil liberties, can be trusted not to tamper with the social order. "A disengaged population picking between two business parties every four years". Sounds familiar? As Kennard describes so clearly, we all are living through the latest battles between a global population that wants democracy that prioritises people, not Big Business and capital, and a ruling class that wants the opposite.
Reading Andreas Malm on capital, climate and resistance
FOSSIL CAPITAL CORONA, CLIMATE, CHRONIC EMERGENCY HOW TO BLOW UP A PIPELINE Andreas Malm is a Swedish activist and Associate Professor of Human Ecology at Lund University. "Fossil Capital" is a detailed economic history with excellent analysis, a reworking of his PhD thesis. His other two books in English are short specific arguments. All three books have given me a great deal to think about, and I recommend them highly.
The Industrial Revolution
Many accounts of the Industrial Revolution fetishise the marvellous "self-acting" machines, beginning with the spinning jenny. In "Fossil Capital", Malm unpicks the origins of our present fossil fuelled global economy. He explores factors in the shift to steam engines, i.e. coal power, over 60 years, embedded in the class struggles of the period.
The Industrial Revolution took off in the UK as a boom in cotton production from the 1780s. Malm omits to mention that this derived from a boom in slavery on land taken from Native Americans west of the Mississippi - in which British capital speculated.4 The financial crash he describes in 1825 occurred in the cotton industry in both countries. For the first few decades, spinning machines were driven by water wheels. "Flow" energy (including 6% wind) replaced the "animate" power of skilled hand spinners.
Water mills were built in rural locations where there was sufficient fall in the flow to provide the rotation power. Rural locations lacked enough labour for large cotton mills, so mill owners indentured unpaid "apprentices" from parish workhouses until age 21, and/or spent capital on mill-owned housing and village facilities to attract adult workers. The outlay for water wheels, reservoirs, races, etc. was about the same as for coal-powered steam machinery but, once built, water power was free.
Coal was expensive because of mining and transport costs, but its portability enabled mills to be located in towns with ample cheap labour. In fact, the northern towns, formed from past clearances of landed estates and commons, developed on the basis of coal burned for heating in houses and small manufactories. Once bought and delivered, coal was "stock" power that could be used at the miller's convenience, whereas water "flow" fluctuated with weather and seasons, despite some amazing multi-mill water system designs which Malm describes. Only one such system was taken up by cotton capitalists.
Water power was cheaper, but steam engines were under the control of individual millers and close to supply and sale markets as well as labour. Capitalists, relating to each other through competition in markets, also turned away from water power because it required collective funding and cooperative management of a common good. Malm quotes Rosa Luxembourg: "Free competition... means the disappearance from the economy of any kind of plan or organisation".
Machines Replace Workers
Although spinning was mechanised rapidly, weaving continued to be "put out" to cottage weavers. After the 1825 crash, piece rates were squeezed, and hand looms were brought into the mills, then mechanised - "automated". The means of production was now the private property of mill owners and investors, not spinners and weavers. All mill workers were now machine operators, fully dependent on wages, working to the rhythms of machines and orders, not their own lives.
When ineffective laws against "combination" were repealed, workers and unions began campaigning for a ten-hour working day. This infuriated water mill owners, who compensated for low-flow stoppages by increasing workers' hours when flow power resumed, to catch up on output. Factories Acts prohibited employment of children under nine and limited work hours for those under 12 and under 18, effectively shortening mill operating hours. The Ten-Hour Day Act (10.5 hours with 1.5 hours for meal breaks) was finally passed in 1847.
These restrictions had less effect on the profits of mills with stockpiled coal and no housing costs, which nevertheless, responded with technical improvements to speed up machinery and processes per labour hour. This, in turn, increased the bargaining power of mechanics and their unions, so capitalists in cotton and other industries responded by investing in the development of steam-driven machine tools to do much of the mechanics' work.
Malm quotes an 1835 analysis that "the constant aim and tendency of every improvement in machinery (is) to supersede the human labour altogether, or to diminish its costs, by substituting the industry of women and children for that of men; and that of ordinary workers, for trained artisans". He cites a contemporary estimate that, already in 1826, the horsepower of British stationary5 engines were equivalent to that of 6,400,000 additional men. The purpose of coal-fired steam power was not to render labour superfluous but to increase labour productivity, in order to extract more surplus value as profit and future capital.
Coal-fired steam engines were considered "docile" and "manageable". The sweated workers were not. The first ever fully steam-powered mill was set on fire in 1791. In 1826, in the downturn after the financial crash, Lancaster weavers destroyed more than 1,000 power looms. A law was promptly passed to make wilful damage to a coal mine or engine punishable by death; three men were hanged and factory defenders shot workers with impunity. Workers disrupted production by extinguishing boiler fires or speeding up engines till they broke.
The General Strike of 1842 began with coal miners and spread rapidly across the manufacturing districts. Workers marched from mill to mill, stopping production by systematically pulling the plugs out of all boilers. Their demands were a fair day's pay and a People's Charter that featured universal (male) suffrage to break the capitalists' monopoly on Government.
Had the capitalists' steam-powered machinery not represented a materialised dominance of labour, says Malm, British workers would not have opposed it as stridently. The Government responded with "extra-economic power": thousands of soldiers, special constables, 1,500 arrests rising tenfold within a year, and draconian sentences including 200 transportations.
King Coal
Between 1830 and 1850, coal became the lifeblood of British manufacturing - and of rail transport, shipping and steel production. It increased productivity and profit within capitalist labour relations.6 Coal mines responded to demand, with no innovations of importance before 1890. By the 1860s water mills were gone. In 1870 the cotton factories of Lancaster alone burnt more coal than southern and eastern Europe. Already by 1850 Britain was emitting twice as much CO2 as the US, France, Germany and Belgium combined.
In a dense theoretical chapter, Malm adds fossil fuels and CO2 to Marxist economic formulas (M-C-M1 etc.) for capital/labour property relations in the production of commodities, to extract "surplus value" as profit for reinvestment and expansion. He shows that it is property relations dominating labour that drive capital accumulation and the need for economic growth. Powering capitalist production with coal, oil and gas means a similarly exponential growth in climate pollution.
Fossil fuels are themselves commodities produced for their exchange value; i.e. capitalist property, in a way that water flow is not. When human energy is replaced or leveraged with fossil fuels for the purpose of capital accumulation (as distinct from personal consumption), it consolidates capitalist power and money at the top - the 1% - in tandem with the impacts of their fossil fuels on the planet. That's what we're up against.
Of cumulative CO2 emissions from 1870 to 2014, half occurred after 1986; a quarter in an "emissions explosion" after 2000. In May 2014 scientists announced that the West Antarctic ice sheet had started falling apart. On the same day Canadian oil companies announced new pipelines to take oil from the Alberta tar sands to new markets in China. China had replaced Manchester as the "chimney of the world". Malm explains how globally mobile capital relocated in search of cheaper, disciplined labour, supported by good energy infrastructure and transport connections, and this choice increased per unit emissions.
In 2010 there were waves of strikes by Chinese workers over wages, work hours and conditions, and wage rates were forced up by a third. One option for maintaining profits was a "spatial fix" - relocation to Bangladesh, Cambodia or Indonesia, where Governments promised new infrastructure and energy security from new fossil-fired power stations.
The other option was automation. When 12 employees committed suicide at Foxcomm, a joint venture electronics company, wages were raised but Foxcomm immediately began implementing large scale robotics - as did similar companies. Both options are predicated on fossil energy. Where capital goes, so does capital-labour conflict - and emissions increases will immediately follow, says Malm.
Capitalism Won't Make Transition From Fossil Fuels
Our best hope for the future is energy from wind, water and sunlight; studies show we have the capacity with current technology. But will capitalism make the transition? Malm thinks not. In the early 2000s, Shell and BP were big players in the solar industry, rebranded themselves as "energy" companies. By 2011 both had exited from renewables, to defend their core oil business. In 2011-2013 global investment in renewables fell by 23%. For two reasons. Firstly, the air or Sun itself cannot be charged for and the delivery technologies became cheaper and therefore less profitable with greater scale and competition.
China, where everything is now made anyway, cornered the market. Secondly, although the intermittency of wind and Sun can be resolved with cross-regional "super-grids" integrating different energy sources, this requires long term investment, centralised planning and ongoing cooperation. In 2024, as in 1824, these are not characteristics of capitalist corporations, or of a modern financial sector in which the average stock is owned for 22 seconds.
They are not characteristic of neo-liberal governments either but, if there is to be an energy transition at all, Malm says, states and municipalities simply must take charge. So, what's the idea of getting Blackrock to finance New Zealand's green infrastructure? Oh right, a fat profit would be built into the public private partnership (PPP) agreement, with probably a tax-free capital gain when, as Blackrock has already said, it "exits" the investment within a decade.
"Fossil Capital" is a slow read, but extremely worthwhile. Malm's other two books are shorter polemics. In "Corona, Climate, Chronic Emergency", Malm asks why did the states of the global North take strong action against the corona virus outbreak but not against climate change. Why hasn't Jacinda's generation of Governments seized their "nuclear moment"?
Reviewing the usual excuses, he accepts two. One, that global warming seemed gradual, allowing ample time for vested opposition and denial, whereas covid 19 exploded. Yet the World Health Organisation (WHO) estimates 7.1 million deaths from covid 197 and 150,000+ deaths a year over four decades from climate change - i.e. six million. In 2019 22 million people were displaced by extreme weather events.
Climate change is far from gradual, Malm writes; it is a landslide rolling though the entire Earth system, now causing a cascade of abrupt destructions. The second reason is that climate impacts have affected mostly the global South and the poor. Covid 19, spread out of China with the frequent-flier classes, causing high initial death rates in the rich countries of the global North.
Destruction Of Nature By Capital In Search Of Profits
Malm's main argument, however, is that covid 19 and climate change share a root cause: the destruction of nature by capital in search of profits. He reviews the fascinating science of viruses, bats and deforestation. In the 1960s and 1970s State-supported forest clearances may have been to avert Cuba-style uprisings by landless peasants, but since the 1990s the overwhelming driver of deforestation has been global capital seeking profits from beef, soy, palm oil, coffee and chocolate (damn, I'll have to drop those last two from my PC diet).
Alongside the mining and burning of fossil fuels, deforestation disrupts carbon and weather cycles. It also increases future risk of zoonotic diseases by increasing contact between humans and wild species. Covid 19 is not a one-off, nor is it a separate issue from tackling the climate crisis. During the covid 19 crisis, capitalist states "intervened in a moment of relative autonomy", closing down non-essential production and consumption.
Marxists identify the contradiction in capitalism over-exploiting its own labour and natural resources but, with Governments protecting its background conditions, "capitalism will not die a natural death", says Malm, but move on "outliving every host". Even capital's plans to capture industrial carbon emissions involve profiting from its sale and re-release. In the fight against climate change, fossil capital is the enemy, he says. If nationalised, fossil fuel industries could provide both the capital and the skills for an economic transition. Old institutions must be harnessed to new work.
The task before us, he says, is to consciously intervene before this civilisation destroys itself, before too much damage is done. Histories of non-anthropogenic climate change ending past civilisations "can no more be compared to global heating that a pub brawl to a genocide". Social democracy has run out of time for incremental gains.
Anarchist-informed movements like the Arab Spring or Occupy failed to embed change because they lacked a plan, organisation and "some degree of hard power" to take over State apparatus. Malm sees socialism at a low ebb but nevertheless as a seed bank for our present chronic emergency. He draws on the Bolshevik's "war communism"8 as "only an analogy, but very rich in content".
It began from below with local soviets and unions taking over factories and mines, supported then centralised by the State. Draconian measures were used to overcome the ravages of WW1, famine and civil war, transforming property relations and the State itself. Controversially, with no access to fossil fuels during two years of war against the Whites and their Western allies, the State militarised labour to harvest forests to stoke the boilers and repair the railways. Well, not enough forest left to do that again9, but we have solar and water power.
Draconian Measures Needed
In our current crisis, everyone knows what needs to be done, but no capitalist corporation or capitalist state will do it of its own accord. And no break with fossil fuels will happen in one country. "Global heating is the mining disaster ne plus ultra", says Malm. "It calls for rescue operations not to be idealised as the perfect society". Draconian measures, then, with constraints and "a degree of forsaking". During the transitional period, he says, it will be important to "stay with the dilemma of how to execute control measures in an emergency without trampling on democratic rights".
"How To Blow Up A Pipeline" is Malm's best known book, attracting public attention and activist debate. Even inspiring an eco-thriller movie. The book is about why rather than how. Despite decades of climate science, waves of activism and falling renewables costs, two-thirds of the capital invested in energy generating projects in 2018 went to oil, gas and coal10 - that is, into generating additional supplies of fossil fuels, with glittering profits anticipated.
To keep global warming to 2o, all new projects must be suspended and a fifth of power plants using fossil fuels decommissioned (as at 2018). Yet at the annual UN Framework Convention on Climate Change's Conferences of the Parties (COPs), the response of Governments has been "blah, blah, blah". In Malm's view: "The ruling classes are constitutionally incapable of responding to the catastrophe". The climate movement has made no dent on fossil capital because it is shielded and served by the states, several being sovereign fossil capitalists themselves.
So, what do we do? Malm argues that passive, "strategic non-violenc" tactics alone will not be enough against this adversary. He draws from histories of slavery, female suffrage, Indian independence, civil rights and unionism to show that it never has been enough. To succeed, mass movements need their radical fringe. In the campaign against fossil fuels: "Respect for property will cost us the Earth," he says.
So too will despair and inaction. To "twist the arm of the State" or to make fossil capitalists and corporations desist, a diversity of tactics is needed - with strict selectivity for effectiveness, he says. I think we should all read his valuable discussion of mass public protest vs resistance; unarmed collective violence; sabotage or destruction of property ("constrained, proportionate and discriminating") vs violence that harms people - and think deeply about these distinctions.
In doing so, you might want to consider the 2023 BWB Text "Abolishing The Military" by Griffin Manawaroa Leonard, Joseph Llewellyn and Richard Jackson. The book's main argument - irrefutable, in my view - is the utter pointlessness of the NZ Armed Forces. It also presents historical evidence that violence is not successful in achieving regime change, but non-violent mass movements can be.
What's To Lose?
The authors do not make Malm's distinction between violence and property damage or sabotage, except to point out that destruction of infrastructure has heavy impacts later on ordinary people and succeeding governments. On non-violent mass movements, they cite US political scientist Gene Sharpe ("From Dictatorship To Democracy", 1993, etc.). But I recognise that this discussion, these tactics, are about ousting dictators or Governments - not how to oust the corporate drivers of a fossil fuelled global economy.
Malm's points about diverse tactics and strategic targets strictly chosen for effectiveness begin to make sense. I worry that direct public action often results in key activists wasting years in court or jail. Recently in the UK, under a new anti-protest law, five activists received four and five years' jail for just planning via Zoom an "essentially peaceful" road-blocking protest, and others were arrested setting up a family-friendly campsite near the wood-burning Drax power station.11 So what's to lose by stronger, carefully targeted acts of resistance to corporate power and State capture?
Or is "How To Blow Up A Pipeline" just the frustrated and provocative "proposal of a wrecker" - to quote from Workers' Liberty's critique of Malm's work and Marxism6 - to "actively disrupt broad-based efforts to mobilise millions of workers, students and young people to tackle climate chang". I don't know - will these millions be mobilised in time? Which strategy will be effective? Don't we need both? Verso has put together a free e-book of essays "Property Will Cost Us The Earth" (2022)12 from activists and writers around the world on this question. Hopefully, we'll be able to answer it with 20:20 hindsight after the climate revolution. Probably the NZ government will hold a Royal Commission of Inquiry.
WIFEDOM This book doesn't quite fit CAFCA's kaupapa, but is a must-read for George Orwell fans. Well, for anyone with an interest in class and gender relations. I binge-read Orwell's books and political writings in the late 1970s, and loved them. Though I did notice he was not good on women. I remember his denigration of "feminists, vegetarians and sandal wearers"- like me. Several feminist critiques of his work emerged.
When Anna Funder13 picked up a second-hand "Collected Essays", then began re-reading Orwell's work, then the biographies, her writing career was being impacted by the "double burden" at home. This sensitised her to a misogynist comment of Orwell's on women's incorrigible untidiness and devouring sexuality, that could only relate to his own wife. "How was that then, for her? My first guess: too much cleaning and not enough, or not good enough, sex". Her attention shifted "from the work to the life, and from the man to the wife".
In 1936 Orwell married Eileen O'Shaughnessy, who had a degree in English and a Masters in Educational Psychology14, and moved her to rural isolation (and poverty) where he could best write. Until her death from neglected health and short-cut surgery in 1945, she was his lover, cook and housekeeper, small-holding farm worker, typist and editor of first and subsequent drafts of all his work, which they would discuss.There is ample evidence that her ideas and editorial suggestions underpinned the growing quality of his work. It was her suggestion to write his critique of Stalinism as an animal fable.
Written Out Of His Life & Biographies
When Orwell fought with the anarchists in Spain, his "Homage To Catalonia" mentions that "his wife" was in Barcelona. As well as her name, he omitted that she was there to work for the POUM (the Workers' Party for Marxist Unification, a communist party) organising logistics and communication. When its offices were attacked by Stalinists, which he describes, she rescued and hid passports and other documents, and was at risk of being arrested or shot, as colleagues were. During WW2 and the Blitz, while Orwell wrote and joined the Home Guard, she earned their living in the censorship section of the Ministry of Information. In 1934 Eileen had written a futuristic essay on schooling, that touched on education as thought control and had "1984" in its title. Orwell wrote "1984" after her death, slowly.
Funder explores the techniques by which Eileen's contributions, and at times her physical presence, were written out of Orwell's work and that of his biographers.15 Nor was she respected as his lover. Letters and other writings, mainly by the women concerned, reveal a series of sexual relations, including Orwell simply "pouncing" on them. That is, attempted rapes and what we would call date rapes, as well as long term affairs during the marriage.
Eileen's importance in Orwell's life and career appears to become clear to him after her death. He immediately seeks a replacement. He makes a series of marriage proposals to women with editorial skills, job description in hand ("Do you like children?" "You will need to learn to make dumplings"). They were to live with him, his sister and his and Eileen's adopted baby son on a croft (cottage) on Jura, off the coast of Scotland. They say no, of course. On his deathbed from tuberculosis (which he denied for a decade), he finally gets a yes out of Sonia Brownell, a magazine editor and manager. The job of wife by this stage is to manage his literary estate.
"An Arsehole"
As an Orwell fan, I feel slightly devastated by all this. It seems that Orwell's strong analysis of class and power, the basis of his literary success, was something that, quite clearly, he did not apply to women. His politics surely originated in the educated, suffragist, free-living women in his mother's side of the family. But his father's descent from the aristocracy to the "shivering verge of gentility" may have contributed to his assumption of complete class privilege in regard to women.
Sexual, household, financial, editorial, introductions to publishers - as Funder details: "Orwell relied on women at every turn". From young girls in Burma to his wife's women friends - and certainly with Eileen herself - Orwell simply expects the services that women exist to provide. "It's hard to know how to think about an author you've long loved", says Funder, "if you find out they were..." as her teenage daughter put it "...an arsehole".
After that, I had to read some Orwell. His "1984" is available free on Internet Archive. It's grim, but I thought his discussion of war holds up really well in 2024. If you didn't spot his protagonist's entitled attitude to women, try "Julia" by Sandra Newman (2023). It's an imaginative retelling of "1984" through the eyes and differing experience of Winston Smith's lover.
Endnotes
Watchdog - 167 December 2024
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