The New Robber Barons

image002Previously, Marcy Wheeler noted the unsavory blending of the private interests of health insurance companies with the power and hand of the US government:

It’s one thing to require a citizen to pay taxes–to pay into the commons. It’s another thing to require taxpayers to pay a private corporation, and to have up to 25% of that go to paying for luxuries like private jets and gyms for the company CEOs.

It’s the same kind of deal peasants made under feudalism: some proportion of their labor in exchange for protection (in this case, from bankruptcy from health problems, though the bill doesn’t actually require the private corporations to deliver that much protection).In this case, the federal government becomes an appendage to do collections for the corporations.

The reason this matters, though, is the power it gives the health care corporations. We can’t ditch Halliburton or Blackwater because they have become the sole primary contractor providing precisely the services they do. And so, like it or not, we’re dependent on them. And if we were to try to exercise oversight over them, we’d ultimately face the reality that we have no leverage over them, so we’d have to accept whatever they chose to provide. This bill gives the health care industry the leverage we’ve already given Halliburton and Blackwater.

Marcy termed this being “On The Road To Neo-feudalism” and then followed up with a subsequent post noting how much the concept was applicable to so much of the American life and economy, especially through the security/military/industial complex so intertwined with the US government.

Marcy Wheeler is not the only one recently noting the striking rise in power of corporate interests via the forceful hand of US governmental decree (usually at the direct behest of the corporate interests). Glenn Greenwald, expanding on previous work by Ed Kilgore, penned a dynamic description of the dirty little secret (only it is not little by any means) afoot in modern American socio-political existence:

But the most significant underlying division identified by Kilgore is the divergent views over the rapidly growing corporatism that defines our political system.

Kilgore doesn’t call it “corporatism” — the virtually complete dominance of government by large corporations, even a merger between the two — but that’s what he’s talking about. He puts it in slightly more palatable terms:

To put it simply, and perhaps over-simply, on a variety of fronts (most notably financial restructuring and health care reform, but arguably on climate change as well), the Obama administration has chosen the strategy of deploying regulated and subsidized private sector entities to achieve progressive policy results. This approach was a hallmark of the so-called Clintonian, “New Democrat” movement, and the broader international movement sometimes referred to as “the Third Way,” which often defended the use of private means for public ends.

As I’ve written for quite some time, I’ve honestly never understood how anyone could think that Obama was going to bring about some sort of “new” political approach or governing method when, as Kilgore notes, what he practices — politically and substantively — is the Third Way, DLC, triangulating corporatism of the Clinton era, just re-packaged with some sleeker and more updated marketing. At its core, it seeks to use government power not to regulate, but to benefit and even merge with, large corporate interests, both for political power (those corporate interests, in return, then fund the Party and its campaigns) and for policy ends. It’s devoted to empowering large corporations, letting them always get what they want from government, and extracting, at best, some very modest concessions in return. This is the same point Taibbi made about the Democratic Party in the context of economic policy:

The significance of all of these appointments isn’t that the Wall Street types are now in a position to provide direct favors to their former employers. It’s that, with one or two exceptions, they collectively offer a microcosm of what the Democratic Party has come to stand for in the 21st century. Virtually all of the Rubinites brought in to manage the economy under Obama share the same fundamental political philosophy carefully articulated for years by the Hamilton Project: Expand the safety net to protect the poor, but let Wall Street do whatever it wants.

One finds this in far more than just economic policy, and it’s about more than just letting corporations do what they want. It’s about affirmatively harnessing government power in order to benefit and strengthen those corporate interests and even merging government and the private sector.

Ms. Wheeler and Mr. Greenwald are correct, and the phenomenon is not just limited to the healthcare and military/industrial complex either; it is even more alarming in the ever more dominant and pervasive financial sector, home of the “too big to fail”. The phrase itself should terrify citizens, yet the country seems blithely oblivious to the implications. If there was even a vein of common sense among the people and leadership of this country, there would be immediate realization that an entity too big to fail is so big that it controls the government as much as the other way around. But the people are asleep, distracted by their own despair and desensitized over the years. The leadership, as both Wheeler and Greenwald describe have become symbiotic with the cause and, thus, are the part of problem not a source of solution.

Marcy Wheeler describes the concentration of power and wealth in corporations married to the hand of government as neo-feudalism; Glenn Greenwald and Kilgore posit it as corporatism. Both are worthy and descriptive terms, but the real ill goes a bit deeper if you also consider the accompanying rise in income inequality and transfer of wealth to the privileged and powerful few individuals that has paralleled what Marcy and Glenn describe. When you put it all together, the result is a situation that eerily duplicates the era of the robber barons existing in the United States 100 years ago.

The New Robber Barons

Robber Barons as a descriptor for the modern overlords came to me during a conversation with several colleagues a week or two ago on how to term the healthcare companies and their owners and executives. In writing this article, however, I have found I am far from the first person to realize how the old is new again in this regard to the rapacious class. Over a decade ago, Brad DeLong hit on the same precise thought, and he hit it hard and big:

“Robber Barons”: that was what U.S. political and economic commentator Matthew Josephson (1934) called the economic princes of his own day. Today we call them “billionaires.” Our capitalist economy–any capitalist economy–throws up such enormous concentrations of wealth: those lucky enough to be in the right place at the right time, driven and smart enough to see particular economic opportunities and seize them, foresighted enough to have gathered a large share of the equity of a highly-profitable enterprise into their hands, and well-connected enough to fend off political attempts to curb their wealth (or well-connected enough to make political favors the foundation of their wealth).

Matthew Josephson called them “Robber Barons”. He wanted readers to think back to their European history classes, back to thugs with spears on horses who did nothing save fight each other and loot merchant caravans that passed under the walls of their castles. He judged that their wealth was in no sense of their own creation, but was like a tax levied upon the productive workers and craftsmen of the American economy. Many others agreed: President Theodore Roosevelt–the Republican Roosevelt, president in the first decade of this century–spoke of the “malefactors of great wealth” and embraced a public, political role for the government in “anti-trust”: controlling, curbing, and breaking up large private concentrations of economic power.

And whatever the causes, the period since the mid-1970s has seen wealth concentration in the United States increase more rapidly than ever before–even during the heyday of industrialization in the last decades of the nineteenth century. Aggregate measures of wealth concentration today are greater than at any time since the election of Franklin D. Roosevelt in the Great Depression, and are within striking distance of the peak in wealth concentration reached during the Gilded Age (see Wolff, 1994).
It is striking how closely numbers of “billionaire” match shifts in aggregate wealth inequality: when the frequency of billionaires in the labor force is high, wealth concentration is high. A simple linear regression predicts that the frequency of billionaires would drop to zero should the share of wealth held by the top one percent drop to twenty percent or so–and, indeed, we find no billionaires back when wealth concentration was so low.
These causes of immense wealth have nothing to do with the determinants of the relative supplies of skilled and unskilled workers, or with the technological requirements of production. It makes me think that the overall level of wealth concentration is much more a “political” and a “cultural” phenomenon than an “economic” one: that we through our political systems and our attitudes have much more to do with the concentration of wealth than does the dance of factor supplies and technology-driven factor demands.

DeLong’s piece is a comprehensive thesis that describes both the history of the earlier American robber barons and modern day versions, at least as of the time he penned his work in 1997-98. Brad noted disturbing trends at the time, but did not reach hard conclusions as to the overall effect of the phenomenon on the health of American society.

So if there is a lesson, it is roughly as follows: Politics can put curbs on the accumulation of extraordinary amounts of wealth. And there is a very strong sense in which an unequal society is an ugly society. I like the distribution of wealth in the United States as it stood in 1975 much more than I like the relative contribution of wealth today. But would breaking up Microsoft five years ago have increased the pace of technological development in software? Probably not. And diminishing subsidies for railroad construction would not have given the United States a nation-spanning railroad network more quickly.

So there are still a lot of questions and few answers. At what level does corruption become intolerable and undermine the legitimacy of democracy? How large are the entrepreneurial benefits from the finance-industrial development nexus through which the truly astonishing fortunes are developed? To what extent are the Jay Goulds and Leland Stanfords embarrassing but tolerable side-effects of successful and broad economic development?

DeLong knew what the issues were, but did not have firm conclusions and answers as to the potential detriment or benefit of such unequal wealth distribution. However, the decade plus that has elapsed since Brad wrote his version of the robber barons, and especially the last two, has put a far different patina on the situation. It is not just the difference between the rich man and poor man, it is the vanishing middle class coupled with the ever grosser arrogance, recklessness and impunity which makes the New Robber Barons such a dangerous and destructive force. There is no longer need to describe what the downside of the insanity could be; we know, we are living it as we speak and have been over the past two years.

The question is where we go from here with respect to the New Robber Baron overlords. Just mosey along status quo as the Obama Administration appears to envision, not looking back with anger, accountability and real change; or do we plow the harder, but ultimately more fertile ground of curbing the irrational and destructive accumulation of wealth and power through Teddy Rooseveltian anti-trust programs, return of Glass-Steagall protections separation of banking and investment functions and tax and social programs to rebuild the evaporating middle class.

Healthcare is the current flashpoint, and it is rightfully a big one. There is no question but that the US needs “reform”; but there is a real question, still to be answered, whether there will be something produced which benefits the masses of citizens both now and in the future or just an illusory pile of junk that benefits the ruling classes of politicians and health industry robber barons.

As Marcy Wheeler and Glenn Greenwald have persuasively argued, however, it goes much, much deeper than merely healthcare; the battle is over the root ethos of what this country is and is going to be. The incontrovertible trend is toward an unholy blending of the robber barons with the government itself. Not just the usual influencing of government policies through lobbying and monetary control of individual politicians to seek favorable policies, but where the federal government becomes an appendage to do collections, enforcement and expansion for the corporations. The best time to rethink and reverse this trend is now, it will not get easier as the trend becomes more ingrained and pervasive with time.

As long as this post is, the surface of this topic has barely been scratched. It is my hope to peg this phenomenon with a term simple, descriptive and instantly understandable by all, and to start a discussion both in comments to this post and in subsequent posts here and by others across the spectrum. Time is wasting at an alarming rate.

(graphic courtesy of Southern Labor Archives, Georgia State University)

161 replies
  1. Phoenix Woman says:

    Bernie Sanders had it right: Too big to fail is too big to exist.

    Sad that somebody like the trust-busting Teddy Roosevelt would be considered far too “liberal” to be electable nowadays.

  2. msmolly says:

    Wonderful post, bmaz. I always am educated at FDL. I am old enough at age 66 that most of the worst of this trend will be inflicted on my children and grandchildren (and their children).

    • bmaz says:

      Excellent corollary point. It does very little to curb anything as the penalty to the company, if a financial one was imposed, is allowed to be amortized out over the time the matter was in litigation and, often, over the period of the monitoring/probation the monitor is assigned to be involved. Not to mention that the monitor chosen is usually one the problem corporation/entity agrees to and can “work with”. Since the monitor is being paid, richly, by the corporation/entity, they have built in incentive to bend over backwards to please them. It is thoroughly corrupt.

      • ApacheTrout says:

        It’s funny (as in I laugh so hard it hurts and then I cry) that justice of this nature, when practiced with drug users or others who commit relatively minor crimes, is decried by law and order Republicans as a “soft on crime” approach.

  3. phred says:

    Great post bmaz thanks. A few years ago I read a couple of books about Teddy Roosevelt. One of the key arguments for breaking up monopolies and redistributing wealth was that wealth concentration and monopolistic power posed an existential threat to democracy.

    I think we can see that effect now. Our government is no longer responsive to the citizens nor are they acting in the interest of the public welfare. They are in thrall to the new robber barons and act accordingly. I think we have an uphill battle to restore the balance of power in this country. Neither politicians nor corporate CEOs will cede their current power structure willingly.

  4. Kassandra says:

    I was just gonna say that we now know the results of this aggregation of wealth…societal chaos.
    And the distraction of the Nigerian kid on the plane over Xmas.
    But when we have Gov hand in glove w corporations and people still terrified for their lives over the very thought of someone “harming” them, even while they are being totally harmed by these false flags events and do not have the wit to see the same things happening the same way as 911…except the bomb didn’t go off( prolly too much for O), it seems we’re back at the gate of 2000.
    I guess my only question is what will be too much as the American people continue to fight each other and religion takes over as the despair rises…which it always does in feudalism.
    How far down in the mud do they want US?

  5. JClausen says:


    A veritable tour de force. You have drawn together these threads in a compelling and well argued thesis. This old law student turned History professor has been exploring these themes under the title “Whatever happened to the American Dream?”

    (About the only thing History profs will agree about Reaganism is that the rich got richer, poverty increased, and the middle class has run like hell to achieve the American Dream.)

  6. milly says:

    Conprehensive post..

    Since fascism is the combination of corporations and govt. without any private citizen’s welfare involved..why do we dance around the phrasing?

    Are we afraid that someone over at Daily Kos will call us a wing nut or worse?

    At this point in time when our Federal Reserve is about gone. We are looking all over the world for resources to steal. People are living in tent cities and hunger is right next door and in the door. Can’t we just get over the bullying and call a spade a spade?

    Let’s face it, if you are not Third Way , Kos isn’t going to approve of you anyway.

    • bmaz says:

      It is not classic fascism, that is why. Fascism is a term that far too many (no particularly referring to you, just in general) easily bandy about without regard to its true definition. Classical “fascism” contemplates one party rule and disparagement of capitalism in a manner not necessarily consistent with what is afoot as described in this post. It may be where this trend progresses to, but it is an inflammatory term not yet consistent with the phenomenon described, and it is far too loaded and controversial term to be wrongfully applied; to do so prematurely is also counterproductive at this point.

    • temptingfate says:

      The term fascism carries far too much baggage to be useful. The first thing people respond to when they hear the term is the death camps and the attempt to take over adjoining countries via military might.

      When I have argued with some of my Obama supporter friends in the past and mention corporatism they have quickly latched onto using the word fascism because they think they can defend against that much more easily.

      Corporatism is simply the belief the needs of corporations are more important than the needs of the state or the individuals within it. Short, easy to understand and lacking implications of racism, death camps, hatred of non-christians and so on.

      • knowbuddhau says:

        Fantastic post, bmaz, thanks. I’m much obliged.

        temptingfate, you prefer corporatism because it is “lacking implications of racism, death camps, hatred of non-christians and so on.”

        That’s exactly why I prefer to use “feudalism.” All three of those are prominent features of our foreign policy. Feudalism suggests an overtly patriarchal, religious, war-loving system of governance. And that’s what we have in America today.

        Are our wars sold to us without a hint of our mythical supremacy? Are they marketed to us as coldly clinical applications of purely technical knowledge, not a whiff of American exceptionalism? Are we at war purely for corporatism, no racism, sexism, or Christianism? Is life really an eternal holy war between the forces of good and evil?

        Most importantly: Are we self-sovereign citizens, or subjects of the arbitrary will of a pseudo-divine cosmic tyrant? If the cosmos itself is imaged as an absolute divine right monarchy, how will that affect their ability to govern our democratic republic? People who believe the cosmos itself is a monarchy can hardly be expected to produce the most robust democracy.

        Neo-Feudalism is the result of the efforts of Christian Imperialists to recreate the world in the image of their god’s mythical heavenly kingdom. The best we can hope for, in this dispensation, is to be servants on the estates of our Lord’s landlords. The business model they have in mind, for the whole planet, is plantation.

        Excerpted from Mourn on the Fourth of July
        By John Pilger
        09 July 2009
        New Statesman

        “Now listen, either you gooks come on out from wherever you are, or we’re going to come right in there and get you!

        The people of Tuylon finally came out and stood in line to receive packets of Uncle Ben’s Long Grain Rice, Hershey bars, party balloons and several thousand toothbrushes. Three portable, battery-operated, yellow flush lavatories were kept for the colonel’s arrival. And when the colonel arrived that evening, the district chief was summoned and the yellow flush lavatories were unveiled.

        “Mr District Chief and all you folks out there,” said the colonel, “what these gifts represent is more than the sum of their parts. They carry the spirit of America. Ladies and gentlemen, there’s no place on earth like America. It’s a guiding light for me, and for you. You see, back home, we count ourselves as real lucky having the greatest democracy the world has ever known, and we want you good folks to share in our good fortune.”

        Thomas Jefferson, George Washington and Davy Crockett got a mention. “Beacon” was a favourite, and as he evoked John Winthrop’s “city upon a hill”, the marines clapped, and the children clapped, understanding not a word.

        It was a lesson in what historians call “exceptionalism”, the notion that the United States has the divine right to bring what it describes as liberty and democracy to the rest of humanity. That this merely disguised a system of domination, which Martin Luther King described, shortly before his assassination, as “the greatest purveyor of violence in the world”, was unspeakable. As the great people’s historian Howard Zinn has pointed out, Winthrop’s much-quoted description of the 17th-century Massachusetts Bay Colony as a “city upon a hill”, a place of unlimited goodness and nobility, was rarely set against the violence of the first settlers, for whom burning alive some 400 Pequot Indians was a “triumphant joy”. The countless massacres that followed, wrote Zinn, were justified by “the idea that American expansion is divinely ordained”.

        Our crimes have been racist, Christianist, and imperialist. There’s a good reason for that. It’s the mythology!

        About the only homogeneous trait of our dear leaders, is their undying faith in war as the proper way of being in the world. They get that idea from their mythos: that of the cosmos as an artifact, a construct, of the cosmic tyrant who is imaged as a male war god with the beard and sandals and all that, sitting on a throne.

        They worship the King of Kings, the Lords of Lords, maker of heaven and earth, etc. And since “He” is the maker of all things, all things, including humans, are his private property, subject to his arbitrary will.

        The god of the West, the American god, is a political figure. Thus, if you want to jack public opinion, just couch your message in terms from this mythology.

        We may not have an official one, but a patriarchal cult of kinetic force is our de facto state religion. We’re waging several bogus holy wars, all in Muslim countries, all for control of land for control of energy, and the unspoken subtext is, our wars are the only holy holy wars.

        Our Father in Washington even said “make no mistake: Evil does exist in the world.” Really? Can I get me a pound of that? Evil doesn’t exist apart from human actions. It’s like ice and water: apart from liquids, you find no ice; apart from humans, you find no evil.

        Instead of looking within, instead of expanding the circle of concern to include the entire cosmos, zealots try to clear the world of the evil in their own hearts, thus laying waste to the world and feeling quite self-righteous about it.

        Obama’s speeches, like those of any propagandist seeking to manipulate mass public opinion, contain large doses of myth-making. He uses tropes and symbols that bypass our neocortex and push our buttons. Mythic metaphors speak directly to our emotions and impulses. Thus, we can be persuaded into doing things that make no sense.

        “It’s a scintillating stratagem,” Harold Pinter said, in his 2005 Nobel Laureate in Literature speech. “Language is actually employed to keep thought at bay.”

        (Video of Pinter presenting the lecture is here.)

        In truth, whoever can make you believe in absurdities can also make you commit atrocities.–Voltaire, 1765.

  7. TarheelDem says:

    It makes me think that the overall level of wealth concentration is much more a “political” and a “cultural” phenomenon than an “economic” one: that we through our political systems and our attitudes have much more to do with the concentration of wealth than does the dance of factor supplies and technology-driven factor demands.

    And thus do economists re-read their Adam Smith, especially his discussion of the role of government and taxation in creating the “wealth of nations”. One of the impressions one gets from economic history is that concentration of wealth into a few hands actually reduces the aggregate wealth of the socieity, the “wealth of the nation”. Concentration of billionaires results in a surplus of uninvested savings–that is, a paper economy out of touch with creating workplaces in the real economy. The lack of workplaces reduces the demand for workers, which lowers the demand for goods and services, which reduces production of consumer goods and services, which reduces the “wealth of the nation”. Without being Marxian, one notes that Marx read the early economists and came to the conclusion that unregulated power of capital destroyed wealth–his contradiction at the heart of capitalism. Or better said, concentration of wealth eventually leads to a financial meltdown from lack of consumer demand. And all the accounting tricks and all the steroids of free credit and all the government subsidies don’t stave off the day of reckoning as long as they support the further concentration of paper wealth. But until the day of reckoning, who gets hurt are the very folks who could turn the situation around — the consumer-workers.

    So if the “robber barons” win, we will face an even more calamitous meltdown in the near future. Because, paradoxically, they are incapable of really acting in their own interest. With exceptions noted, like Warren Buffet, who is very well able to act in his own interest by pursuing the real public interest.

    • dcgaffer says:

      Very well put tarheeldem.

      You captured the idle capital issue. The other side of that construct is that while capital may not be idle, it also may not be working for us. It is the fallacy of “rich people create the jobs” as a bedrock principle of public policy. It is true of course, but where?

      The argument goes that we need to cut the capital gains tax, or have a reduced tax on dividends because it will put more money into the hands of investors who will create industry, jobs and more wealth. What it glides over is that all people, whether rich or poor, are rational profit-maximizers.

      If you have a 401(k) or an IRA, this should be pretty straightforward. If you can put your money in an mutual fund of primarily US firms that is earning 8% or a foreign stock fund that is earning 14%, where does your money go?

      Of course you chase the higher return, or at least stick your toe in the water. Those investments dollars, that we taxed at a lower rate here in the US, then go (or a least some portion) to promote and build industry, jobs and wealth in foreign countries. Doesn’t do a damn thing here – actually it hurts – because it makes us competitively weaker.

      Nowadays, we are able to transfer capital anywhere across the globe almost instantaneously, with little risk.

      The point here is that very few people are patriotic when it comes to their investments. So why favor investment and unearned income with lower tax rates, unless it can be demonstrated that the income was invested in domestic activities?

      • bmaz says:

        The point here is that very few people are patriotic when it comes to their investments. So why favor investment and unearned income with lower tax rates, unless it can be demonstrated that the income was invested in domestic activities?

        I think that is a pretty interesting thought and proposal.

        • earlofhuntingdon says:

          I suggest there’s no basis to favor unearned investment income over wage income. It subsidizes the already wealthy, who are the lower tax rates primary beneficiaries – on the promise that “you, too, can be a millionaire someday”. All income should be taxed at the same rate. And the idea that hedge fund managers are betting their own capital and thus deserve an even lower tax rate is actually quite vicious and pernicious.

  8. TalkingStick says:

    I am so glad to see more and more people writing with this focus. And you do it eloquently. The solutions seem few and spare. But the more we write and talk the more clear they will become.

    As someone now almost 80 I have a historical perspective that reminds me of the extent and speed of the decline in quality of life for average people. As a physician I am particularly attuned to the disaster of failing quality as well as access to health care. But not just care, what were once the most marvelous national and international public health programs are now in shambles. I know just pointing that out may seem more depressing than useful But it is my view this country is very near a serious tipping point.

    Pray we can use the political process to right it. I counsel haste.

  9. kafka says:

    Anyone catch this post by Yglesias at Think Progress last night?

    “…if it turns out that Obama has succeeded in creating a stable, workable version of the individual market for health insurance then that would open up a politically realistic approach to the longstanding conservative idea of privatizing and voucherizing Medicare.”

    • TalkingStick says:

      I didn’t see that but have thought it. In my view the bad news is in the goal. The good news is I really don’t think he has been successful. This insuranceocracy he has built relies on the people having large amounts of money to spend. Most even now can’t access many of the “benefits” Having insurance for 60-70-even 80% is like having none if you don’t have the other 20-40%.

    • Bluetoe2 says:

      I’ve thought for the last several months that Obama will be the one to finally rid the nation of SS by privatizing it. Only a Democrat could destroy the last vestige of FDR’s New Deal. Wall St. is salivating.

  10. karenjj2 says:

    Thank you, bmaz. I especially like that you dropped the word “companies” for the correct term: corporations/robber barons.

    I have been alarmed and saddened ever since I noted the clause in NAFTA that gave corps and governments the power to file lawsuits. My despair deepened when patents and copyrights became corporate ownership rather than limited reward for HUMAN endeavor.

    As you stated, we could go on and on describing the gutting of the united states and the founders ideals, but solutions will have to come outside of the fascist ‘rules.’

    I think some small towns have hit on one idea: issuing their own script. And many of the truely skilled middle class will once again discover barter in this new age feudalism.

    Thank you for a fine article that illuminates the forest.


  11. lmsinca says:

    Thanks for tying all the threads together for me. I have been railing against corporatism at another blog for months to no avail. Your post gave me an historical perspective I’ve been missing in my argument. Where do we go from here though?

  12. CaptCT says:

    We need competing institutions, organized and supported on a massive scale by progressives.

    It’s obvious that political activism has its limits. Congressman are easily bought by private interests. Only by undermining and competing against the private interests will change happen.

    How to do this? Develop competing institutions. For instance, why not start something like a Progressive Health Insurance Trust — a nonprofit health insurer that competes directly with for-profit insurers on the health care exchange.

    Or, create non-profit savings and loans, or credit card companies, and advise progressives to bank there.

    Create learning institutions or apprenticeships that don’t require college students to go into debt for life in order to make a decent wage.

    In other words, progressives need to concentrate their talents and purchasing power to support progressive institutions. This requires planning, organizing, and financing from progressives, on a massive scale, and it needs to start now.

    • demi says:

      I completely agree with you. But, how to get those started. Maybe after all the laid off employees from the big corporates stop licking their wounds and face the realities that bmaz has spelled out, they can put their heads together and brainstorm.
      I think it’s a step in the right direction that we have voices in the media now who address the truth.

      • CaptCT says:

        It starts with a meeting, and by taking inventory, and by setting some goals.

        We need to figure out what assets we have — organizationally, financially, structurally. We have to meet together and come up with a plan.

        For instance, people like Jane Hamsher, Glenn Greenwald, Chris Bowers (and OpenLeft) can provide organizational and legal support. They can even serve as the Board of Trustees, perhaps. We would likely have to start small.

        Before we get to founding an insurance company, for example, we may need to start, a real estate company, or a software company. Create a Progressive Chamber of Commerce and support those businesses. As those businesses grow, so do financing capabilities for other businesses.

        • demi says:

          Sounds good. We also have to realize that this wouldn’t happen over night. Imagine if this had started 9, 12 years ago? This is not a time for instant gratification. Eyes on the prize.

        • robgard says:

          I would expect the reaction of the corporate power elite and the government would not be benign acceptance. The monied interests would seek to use the levers of “their” government to obstruct and defeat the progressive economic entities. Workplace raids looking for unauthorized workers, allegations of patent infringements, other nuisance lawsuits, legislation passed that would obstruct or outlaw certain initial organizing actions taken by the progressives. If that didn’t work, then the old tried and true “buy them out”. The corporate powers would make the new progressive entities an offer that they couldn’t refuse, and then take them over or shut them down. Wile alternative enterprises is a great idea, they would not get off the ground unless they had protection from the government and the corporate dieties.

    • CaptCT says:

      Also, create a Progressive Chamber of Commerce.

      Develop a network of progressive companies — and support them: everything from real estate brokers to toy makers to carpenters to software makers etc.

      Employees currently slaving away to make some corporate CEO more rich could potentially be hired away as a shareholder in a progressive trust company, or some such thing.

      • CaptCT says:

        Thanks, I read that, plus Spoon’s first post on the same subject.

        We are being out-organized right now, and if there is anything we can or should be able to do through our progressive channels, it is organize.

        (In fact, I think much of the craziness (anti-Hamsher, anti-Taibbi, anti-Michael Moore) you see at DKos is an attempt by DLCers to keep us fighting amongst ourselves and NOT organized. Fighting those gremlins will be a constant struggle — and should be addressed in any kind of strategy meeting.)

      • CaptCT says:

        CREDO – exactly. I use CREDO for my phone service. They also have a credit card program.

        Also, think about Newman’s Own — a successful nonprofit food company that supports all kinds of charitable organizations.

        • temptingfate says:

          My family has been using CREDO since before they changed their name from Working Assets.

          Why, back when I was a kid… 12 feet of snow, walked 4 miles to school uphill both ways.

    • Sufilizard says:

      I’ve been advocating for something like this for years – and we’ve seen things of this sort implemented on a small scale – see Blackspot shoes and Coop America. I agree we need to ramp it up to a much larger scale.

      Try finding some American-made jeans. Why can’t we take advantage of information technology and develop a dispersed cooperative of workers manufacturing clothing from their homes?

      • CaptCT says:

        I nominate bmaz to get this meeting started. Maybe bmaz could ask Jane if she would take a role in it.

        See who else might be interested in taking part. I don’t feel I need to be there — but I would be glad to. Maybe you would be interested in attending too. I think Jane has all of our email addresses, so she could contact whoever she wanted.

        • Sufilizard says:

          Agree, we need a good coordinator. I have ideas, but I’m not so good at getting people together to implement them. Don’t even get me started on my electric motorcycle idea. ;-)

  13. jimpharo says:

    I can recall my career in Corporate America (c. 1983-2005) as being one long exercise in generating wealth for shareholders by taking it away from employees, suppliers and ultimately even customers.

    American business leaders used to be the envy of the world. Now, even many large “American” companies are led by non-Americans. We have lost our ability to innovate (diverting all our R&D to guns and rockets surely is a cause), and have masked our failure by essentially eating our seed corn. We are now no longer on the verge of “neo-feudalism” (a term I think is spot-on). Rather, we are well into it.

    In the long sweep of time, governments have generally been the tool of the rich and powerful and not the champion of the people. The founders figured the people would need to re-assert their control about every 50 years or so. In the last 250, we’ve had a few feeble attempts, but by and large the corporatists have had their way. In Europe, the governments fear the wrath of the people. Can that be said in any way about the US?

  14. noor says:

    I have a tag name for you: corporate feudalism. We’re all, to a greater or lesser extent, in thrall to the corporations.

  15. Sufilizard says:

    Okay, I’ve been incommunicado for much of the holidays, but I’m glad I checked in this morning. I don’t think this point can be emphasized enough. As misguided as the teabaggers are, they are also sensing this problem of corporatism – unfortunately their efforts tend to be counterproductive.

    I also love the discussion of the term fascism. I think this is also a healthy discussion to have. I agree that the term has been laden with too much baggage to be helpful at this point. But I also understand the argument that what we are experiencing is fascism.

    “Fascism should more properly be called corporatism because it is the merger of state and corporate power.” – Benito Mussolini.

    Since Mussolini was one of the key figures in the creation of fascism, I think we have to take his definition seriously.

    The political philosophy has manifested itself a little differently in 21st Century America, but I think at it’s core, it probably is fascism.

    That being said, I think it’s unhelpful to throw the term around in political discussions because the classic definition is not really the “working definition” anymore.

    Does that make sense?

  16. cbl2 says:

    Good Morning bmaz and Firedogs,

    the commenter upthread calling this a tour de force was right on. wow

    I just don’t get how so many of the Bill’s supporters miss this – DeLong has endorsed passing the Bill as is for goodness sakes.

    Jane said something yesterday:

    . . . but the problem with no public option is the mandate that forces Americans to pay almost as much to private companies as they do in federal taxes with no alternative.

    That’s an incredibly radical thing to do. It’s unprecedented. It’s like the pre-privatization of Social Security. Think about it: if Wall Street had been successful in getting the Social Security money into their coffers and skimming from it, you’d have essentially what this health care bill will be with no public option.

    every single prominent voice in support of this Bill fought hard against this very thing in 05

  17. stevedw says:

    Idealism in America. The idea that our city on the hill is the shiniest and our democracy is the purist, comforts Americans who go about their daily pursuit of happiness. They are oblivious to changes that do not have an immediate impact. Naomi Klein’s Shock Doctrine explains well how Government uses fear during calamity to move Congress to pass laws that an Idealist’s inner pragmatist accepts.

    Once enough Americans realize the IRS has become a collection agency for big business Insurance companies, they will experience a huge shock. The question is, will those unable to afford health care be able to find the power to change government, as our system devolves into a state of neo-feudalism.

    Neo-feudalism is the better term compared to corporatism. It shocks me with the idea our country is regressing hundreds of years. I wonder if we are becoming more like China, than China is becoming more like us.

  18. pdaly says:

    Seems we will reach a point soon when the right wing will join with the left to reverse this trend. Afterall, from a serf’s perspective, it doesn’t matter whether the task master is the government or a corporation. Either way, the serf’s labor is taxed and the serf’s life choices limited. If it is bad for ‘big government’ to interfere with wealth creation of the individual, why isn’t it equally bad when megacorporations do the same?

    Wonder if even Ayn Rand would have to agree. Her heroes continually fight against “parasites,” “looters,” and “moochers” who demand the benefits of her heroes’ labor.

    • TalkingStick says:

      I don’t think Ayn would be persuaded but I do think the genuine libertarians absent Randism and we progressives have much common ground. I am especially persuaded by the wonderful article in Harpers someone in the thread linked to. Thanks.

  19. lllphd says:

    we’ve been in a corporate feudalism for many years. see thom hartmann’s unequal protection, first published 30 years ago, for just one (nonlawyer) view.

    i would also suggest you take a look at luke mitchell’s quick review of the obamacare situation in last month’s harper’s; succinct, precise, and devastating (scrip required for online viewing; subscribe, or visit the libe…;-)

  20. Leen says:

    Glenn, Marcy, Jane, Bmaz, Katrina often speaking for the peasants who are too busy out there working for Wal-Mart making minimum wage rushing home to find that the electricity was turned off because they were late on their payment. Yes I have run into many folks like this while pounding the pavement for the Dems in Ohio.

    Two parents working making pathetic wages, scrambling to make ends meet, and often having one kid serving in the Bush administration’s war in Iraq and now OBama’s war in Afghanistan. These are the people who used to believe in what their leaders told them. Down trodden, pissed off, and some turn to drugs because they see no other way out. When the peasants have lost faith and hope our elected leaders are fighting a losing battle.

    Before the recess Senator Harkin repeated several times that we will “revisit” the public option. Senator Sherrod Brown stated on the Chris Matthews show that the pushing of the progressives has brought us far more than we would have seen if we had not pushed. Brown said stay active keep pushing.

    How is it that once they have put trillions in the pockets of Pharma and Insurance companies vaults that “incrementalism” works backwards?

    oy vey

    • Mauimom says:

      Glenn, Marcy, Jane, Bmaz, Katrina often speaking for the peasants

      If you’re talking Katrina vandenHoevel, she’s gone over to the dark side: now supports the health care mess and criticizes progressives for opposing it.

      • Leen says:

        While I don’t agree with Katrina on this one. I am sure she has her reasons.

        I have a great respect for her

  21. vjones26 says:

    Harry Reid needs to answer these two questions.

    If it was ok for the Republican leadership to use reconciliation for their tax cuts, why isn’t it ok for the Democratic leadership to use reconciliation for real health care reform??

    If former Speaker Frist was willing to threaten the use of the nuclear option for the appointment of judges, why isn’t Senator Reid willing to threaten the use of the nuclear option for health care reform?

    Jane, maybe you could start putting these questions forward if you think relevant. Thanks.

    • srsjones825 says:

      Reid & co. won’t use reconciliation because they are corporatist whores, and not interested in representing anyone but the monied interests that pay them.

  22. Bluetoe2 says:

    Corporate feudalism sounds about right but then large swaths of the public makes for the ideal serf. Fearful, distrusting of education, superstitious, ignorant of the world, and willing to accept suffering and deprivation as either a consequence of their own “shortcomings” or merely the result of the “natural” order.

  23. shootthatarrow says:

    From the year 1925 onwards towards year 2010 American militarism and corporatism entered into a dance of covergence. American militarism was in decline or dormant during 1920s and 1930s. The 1920s saw a flurry of paper wealth come and go and 1930s brought about American social,economic and political mixing which paved the way for what WashingtonDC accomplished in and during WWII. The Pentagon came out of WWII as did a new American militarism which was very corporate in structure and organization.

    Corporatism has been given legal status that makes it more akin to the aristocracy of old Europe which exercised generational power. American democracy is a rich mans game by virtue of how American political power is connected to the power of wealth to buy legal,media and legislation outcomes or influence American state capitals or the nations capital.

    Corporatism allied with militarism is the bane of our American democracy and rooting out the two will require a political movement independent of both American political parties as they both are captive to American corporatism and militarism.

    Americans can have a much more humane healthcare system.

    Americans can have a more secure social network of education,employment and retirement.

    Americans can have a more level field of democracy that empowers better politics and better governance.

    American corporatism and militarism must yield for the above to happen. This will either take place on civil terms or will move to more violent means of correction. World history gives ample examples of both ways.

  24. marymccurnin says:

    I have a question. When the One Percenters have sucked all of the energy and wealth out of this country what is to keep them here? We live in a global culture/economy. I know that their options are limited in terms of where to hide but I see these parasites leaving an America behind in ruin. We live in a Blade Runner economy. Or am I being too dramatic?

    • cbl2 says:

      you went with Ridley Scott, I went with Coppola:

      If only I could live to see it,
      kid; to be there with you. How
      beautifully we’ve done it, step by
      step. Here, protected, free to
      make our profits without the
      Justice Department, the FBI; ninety
      miles away in partnership with a
      friendly government

    • TalkingStick says:

      I have a question. When the One Percenters have sucked all of the energy and wealth out of this country what is to keep them here

      Absolutely the right question to ask and I think on target observation the truth of which is still denied by most of us. We cannot afford to underestimate the callousness of those who hold economic power. They have absolutely no national loyalties.

        • TalkingStick says:

          India is ripe. Also the Bush people pushed the central Asia and the middle east. And the theocrats like the African continent. China has too much inherent nationalism in my view to succumb.

  25. qunamngdogs says:

    Really excellent (& chilling!) post. bmaz! It occurs to me, regarding the healthcare situation, that the medical community might be enlisted. The people who qualify for subsidies (if I understand it right) will/ may be able to get medical care- and the wealthy, but the middle class (& aren’t we the largest part of the population?) will only be able to afford the premiums (if that). Doctors and hospitals will be losing a lot of business and seeing that go down the drain to the insurance companies. And there is no love lost there.

    Because most medical professionals have accumulated so much wealth, I wonder if they would be willing to set up some kind of co-op to compete with the insurance companies. Just a thought.

  26. bystander says:

    I read David Atkins’ (thereisnospoon) piece when Digby highlighted it. I have to admit, I found it unpersuasive in the same way that “felix” did when he responded to Atkins with this. We are atomized. And, as a result, diluted. “felix” echoes my own feeling as I drown in dozens of organizations which bury my inbox daily. IMHO, we don’t need more organizing, we need more organization. And, to get that we need agreement. And, either a specific division of labor according to some comparative advantage and/or consolidation. I saw a glimmer of it when FDL undertook to whip the vote in the House and OpenLeft undertook to whip the vote in the senate on HCR [sic]. That made sense to me. The one thing I don’t need is more duplication of effort which has me thinking I should prepare a scorecard for each new initiative.

  27. alexius says:

    Wendell Berry often calls industrial corporatism “global colonialism”, and it’s an accurate description of how corporations operate. Jefferson, for example, was at least as motivated to argue for independence by the fact that England forced colonist to produce raw materials so that value (and hence profit) could be added in England as he was by Enlightenment ideals.

    But the industrial model we all know is in the process of running into its own philosophical failures. Not just because it has taken the hunt for cheap labor to illogical extremes. Henry Ford was once touring a new factory with Walter Reuther; he showed Reuther a new machine that would replace several workers and joked that Reuther wouldn’t be getting any dues from the machine. Reuther responded, “Yes, but will the machine buy your cars?” (rough quote there)

    More importantly for the corporate industrial model is that it is more and more quickly running out of the resources that the model requires be cheap and plentiful. Edward Abbey said that industrialism is “the ideology of the cancer cell”. Untreated, cancer eventually kills itself by killing its host.

    Neo-feudalism is about right, imo. The situation is also similar to the time period when the labor movement developed in the US, but that’s probably not a good model to look for answers in since most of them were socialist or communist and those are such dirty words in America.

    Still, what would a Wobblie do?

  28. skdadl says:

    OT, and sorry if I’m repeating anyone else, but for all Canadians present: we are prorogued. Again. Gah.

    For Merkin friends, this has two effects: it’s an attempt to deep-six the first scandal that has stuck to Harper, and it’s an attempt to take over the Senate. It’s also a two-month holiday, and an attempt to use the Vancouver Olympics as PR for sporting chaps like Harper and Jason Kenney.

    • anga19 says:

      Harper is the perfect Conservative (or Republican): daring anyone to oppose, throwing the ball fisrt and strongly, without shame and hesitation. When I think this guy could lead a majority Government!

      This is why I admire Jane’s position of finally taking the ball and throwing it. On our terms.

      • skdadl says:

        He must be one of Karl Rove’s best students ever, eh? He is working from a relatively weak position, but he is just permanently on the attack … and so far, it has worked.

        Sheesh. What do we have a queen for if not to stop this nonsense? If I were the GG (queen), I would say no. She can say no. I think he has the GG scared.

        • reader says:

          He does have the GG scared: if she crosses Harper, he can go after her husband ~ he was a Quebec separatist and they will start a whispering campaing to embarrass him and the GG.

          I was about to give up on politics entirely until the stuff about Afghan detainees came up here in Canada and Jane and FDL came on strong against the health care mess and now this modern feudalism. Good people with smarts and information are starting to fight in meaningful ways.

          And Afghanistan IS a clusterfuck: last night on the CBC show As It Happens, they reviewed a bunch of interviews from the Russian withdrawal from Afghanistan and they noted the parrallels in language are eye- and ear-opening to say the least.

    • reader says:

      And just how self-serving and cynical can the Harper government get before people start noticing??? Can it get more disgusting?

      • skdadl says:

        Oh, yes — it could get much more disgusting if Harper had a majority. At that point, the social conservatives would be let loose. Many of our social programs would be gone (many already have been undermined on the sly). Health care, choice, marriage — teh gone. And Harper hates the courts — above all, he hates the courts. He could do quite a lot about the courts and the Charter (our parallel to the Bill of Rights).

        • reader says:

          It it scary. And there is no one who challenges him. But people are very upset about being embarrassed at Copenhagen and *they* say any move against health care is a non-starter. With the vote against the gun registry, Quebec is not looking any better for Harper. He looks like he is making progress but the pundits are divided.

          He has been using Republican consultants for a long time.

  29. Loo Hoo. says:

    Ariana is pushing Move your Money. She is suggesting community banks.

    I use a credit union.

    * Credit unions are member-owned. If you have an account at a credit union, you’re a part owner in the enterprise. That may not entitle you to use the executive washroom — your CU probably doesn’t even have an executive washroom — but you’re likely to be seen as a person rather than as a “cost center.”

    * Credit unions are not-for-profit. This status helps explain why interest rates tend to be significantly better, and fees fewer and smaller, at credit unions than at banks. Any profits credit unions do make are distributed as dividends to their members. Contrast that with banks, which continually invent new fees and policies to boost profits (and to pay those stunning executive salaries).

    * Banks hate — hate — credit unions. President Franklin D. Roosevelt signed the Federal Credit Union Act into law in 1934 to “promote thrift and thwart usury,” and banks have been gunning for them pretty much ever since.

  30. anga19 says:

    Thanks bmaz for this substantive post. You’ve succeeded to make it ‘simple, descriptive and instantly understandable by all’.

    No wonder FDL is my daily educational spot, along with Asia Times if I may add.

    Someone, don’t remember who, wrote that the Teabaggers had it wrong, it is not the Government that owns the Banks,it is the Banks that own the Government.

    A light flashed for me when, in one of his speech on Health Care, Obama said that the Insurance Companies had to make profit. It is hard to find more capitalist than that.

    I am amazed how Mr O has disseminated lots of hints about his ideological and future policies orientation throughout all his speeches since campaigning.

    Putting it all together would show a real clear narrative of his corporate and neolibal philosopphy. Too bad this is too big of an endeavor for me.

    Th title of this post is most appropriate.

    • marymccurnin says:

      The first red flag that went up for me was O’s “suggestion” that the V.A. be privatized. The push back was huge and I haven’t heard anything else about it since. I am sure it will resurface along with the reform of social security.

  31. bgrothus says:

    Thanks for this post, bmaz. I too have been thinking about the Robber Barons and wondering about the relative difference in the conditions–of capital, of labor, of communication and organizing over the span of time.

    A hundred plus years ago, workers/protesters were killed (by the RBs) in large numbers with impunity. One difference between labor then and now is that the immigrants were hungry and ambitious, different than now where people are just on the rat wheel, and the generation below is really not very motivated, compared to Chinese and Indian youth who are learning English and looking for any opportunity. Working conditions in our country have become largely more safe, compared again to then and to what exists in China now, for example.

    Back then, there were many newspapers in many languages and of various political stripes (anarchist, anarcho-communist, etc). Now, I suppose we have the blogs for our various political and personal interests, and newspapers are going away. One thing we could organize for is alternative news development. Amy Goodman and some magazines are still able to support some alternative news gathering. But the loss of newspapers in this regard is fairly staggering, at this moment in time, IMO. The depth of investigative reporting, or the virtual loss of it, will become more pronounced and will be a huge loss.

    I won’t go on, but I think we do need some larger and deeper discussion. Thanks for opening it up.

  32. Clavis says:

    For most of human history, there was no “middle class”. Those who could exploit the masses for their own enrichment did do. Those enriched supported one another through conspiracy and force. The peasantry accepted their lot, defanged as they were by ignorance, disease and destitution. It is, perhaps, simply human nature for these imbalances to develop and reinforce themselves. Perhaps we are simply incapable of living up the ideals of the Enlightenment.

  33. thereverend says:

    Well said, bmaz. A, if not the, defining divide in American politics today is the between the oligarchs versus the small-r republicans. Matthew Josephson indicted the robber barons, but Ayn Rand celebrated them as a visionary elite. The first era of predation was the closest the world had even been to the ideal of _Atlas Shrugged_. The book looks back to America in late nineteenth century with nostalgia, pretending that most robber barons were self-made men (almost always male). The corrupt business execs that she indicts are those who accede to the New Deal. Most of the oligarchs of the Gilded Age, however, are furnished with outright lies. Boil it down, and _Atlas Shrugged_ is an apologia for those who confiscate the wealth created by the commonwealth.

    At least, that’s what I found when I read the book.

    • TalkingStick says:

      Rand’s glorification and worship of who she calls :”the American businessman” is a meme deeply embedded in our couture, right alongside the worship of the military. As long as they hold power to evoke strong emotions, it will take strong and clever efforts to disempower. them.

  34. jackbuddha says:

    feudalism is exactly what it is. I’ve argued for years that Marx’s neat little dialectical slide from communalism to communism was wrong. No matter where you start on that spectrum, you always end up with feudalism, as in “shit floats”. But I fear they have more ambitious goals in mind. When the slave pool is large enough, and this is the largest it’s ever been, they realize they don’t even need to feed the slaves. They can just work them till they drop, toss their carcases into the pit, and harness fresh ones. I believe there are a few models in history. The first one that comes to mind is the Sanish conquest of the American Southwest and Mexico. Beyond sociopathy.

  35. hijean831 says:

    “would breaking up Microsoft five years ago have increased the pace of technological development in software? Probably not.”

    Actually, probably so. A large part of MSFT’s success is due to their squelching or coopting of innovative competition.

  36. earlofhuntingdon says:

    I’ve used Robber Barons as a descriptor on this blog for quite some time. But I’m glad you’ve given it a thorough review with documentation.

  37. Neil says:

    Couldn’t wait for football trash talk:

    “Getting world-class at innovation requires moving beyond rewarding results to rewarding behaviors.” read more

  38. semiguy says:

    ‘Fascism’ works just fine for me. If someone questions use of the term, I give them FDR’s quote:

    “The liberty of a democracy is not safe if the people tolerate the growth of private power to a point where it comes stronger than their democratic state itself. That, in its essence, is fascism – ownership of government by an individual, by a group,”

    • bmaz says:

      I question the use of the term at this point, and seriously so, and I am quite familiar with FDR. Just because it can be use does not mean it should be used if it is counterproductive to your goal, and I maintain at this time it is just that.

      • semiguy says:

        Well, we agree to disagree then.

        (This is a general comment not aimed at you-) I tend to have little patience for semantics and quasi-academic distinctions, particularly in day-to-day interactions. In general, I find it better to be direct, accurate, and blunt. Personal style, I guess. The trick to making it work is to simultaneously a) be honest and open so that there is room for discussion and exchange of ideas and b) create a starting frame to the discussion that gets your point across from a position of strength.

        The main things I run up against in conversations aren’t resistance to the term ‘fascism’, but rather a) complacency, and b) people who are, by and large, interested but simply without time and energy to become more active and involved. In both cases, pulling out the ‘f-word’ hasn’t really been problematic for good discussion. Going from FDR to Naomi Wolf’s ’10 steps to fascism’ is usually a pretty good segue.

        Your mileage may vary of course. Sorry if this is getting too ‘meta’.

    • earlofhuntingdon says:

      I have long compared Bush’s no tax and spend policies, his attempts to immunize the wealthy from liability and social contributions, and to increase their share of wealth beyond reason, his efforts to upend Social Security, and his ceaseless work to obliterate the federal regulation of business as efforts to set us back in time. Not just to pre-FDR days, Shrub wanted to take himself and, therefore, tried to take the country back in time to Robber Baron days in the late 19th century, when his forebears were wealthy and privileged, unscrupulous and untaxed enough to ride the same private rail cars as John D. Rockefeller.

      Robber Barons made money by innovation. More importantly, they made money thanks to luck, government largesse and wholly unscrupulous business practices. They paid no income taxes. They were unlimited by labor, workplace, environmental and anti-trust regulations. (The environment paid the price for this freeloading, as did labor, which suffered through low wages, workplace injuries, illnesses and death.)

      Robber Barons contributed generously to all three branches of government and generated government that was exceptionally helpful to them. The major railroads, the first great corporations, which were owned by the first Robber Barons (who enabled and were succeeded but not supplanted by steel, oil and mining magnates) were given federal lands coast-to-coast for, um, free. I’m glad bmaz has fleshed that out in some detail.

      That said, I agree that Fascism is an appropriate descriptor for many aspects of the corporate-government partnership we see today. It is an ungainly analogy, though. The word has been corrupted by ignorance at all levels of society, by the media, and from specific attacks by the right. Jonah Goldberg’s absurd Liberal Fascism – a sorry contradiction in terms for anyone who knows their topic, which excludes Goldberg – is simply one of the most pedestrian.

      The concept of “Robber Barons” includes many of the same close connections between private corporations and public government, to the exclusive enrichment of the former and corruption of the latter, but hasn’t the Second World War connotations that mar an analogy with the present.

  39. knowbuddhau says:

    Hey bmaz, like the proverbial “glass half-full,” your head isn’t empty, it’s self-emptying, like these very words. Experience pouring in, awareness arising, behavior flowing out, and all that.

    But that’s not why I stopped by again.

    Rachel Maddow’s interview last night with Spencer Ackerman perfectly illustrates the points I made earlier.

    Maddow’s use of a clip of Pat Buchanan advocating torture is worthy of The Daily Show. What do we do with a captured terrorist? Send him to hell, that’s what god would do! Pain and punishment are positive virtues, in the twisted world of neo-feudalists, that can magically extract Truth from Evil-Doers.

    In their hearts and minds, war is the best of all possible ways of being in the world because that’s the way their male war god made it to work: in favor of males in the “rightful” conquest of all things feminine, esp. Mother Nature.

    That’s why corporatism sounds too clinical, to me, it has none of the visceral impact I get from neo-feudalism. I see our government as an overtly patriarchal cult of perpetual bogus holy wars. Corporatism leaves out the mythology, the beliefs, of the actual humans and their actual lived experience.

    Just listen to our preacher-in-chief. He preached a bogus holy war as America’s best possible way of being in the world while receiving a “peace” prize. Perpetual war, for them, is award-winning peace. That’s myth-making, stagecraft, jacking our opinions with well crafted performances, aka “political kabuki.”

    A huge benefit of conflating the throne of heaven with the seat of political power is that it makes of citizens who petition for redress treasonous heretics. I’m sure a few of us can identify with that peculiar Sith mind trick.

    Thing is, as David Iglesias found out, Sith mind tricks don’t work on Jedi, now do they?

    All their inept attempts to jack our opinions do is strip their political bodies bare.

  40. wethepeople says:

    The effect of the often unholy alliance between government and the private sector_ in this case, Cartel America_ is clearly, what you depict. BUT!_ the problem is at the CORE… the first structural damage to which is our allowing a “Senate,” which is entirely non-representative, to be accorded an unconditional role in the passage of legislation_ whether in the form of forty-one senators blocking a Bill, or NOT. The OTHER systemic problem is not making the donating of so much as a single penny of campaign contribution by a corporate entity_ a federal CRIME!

    Is there a “THIRD-way” OUT?


    They SAY,… “DO not bite the hand that FEEDS!”

    Adam and Eve, could not,… WHY in Hell would it be reasonable to think that anyone ELSE act OTHERwise?

  41. Bubba says:

    bmaz: “It is my hope to peg this phenomenon with a term simple, descriptive and instantly understandable by all, and to start a discussion both in comments to this post and in subsequent posts here and by others across the spectrum. Time is wasting at an alarming rate.”

    The term you’re looking for is monopoly. Henry George’s first book, Progress and Poverty, treats the subject exhaustively. He just as exhaustively lays out a socialist system of economics that has been successfully refuted by … no one. Not in nearly a century and a half it hasn’t.

    The book is available on the Web for nothing. But don’t inconvenience yourself. If you’re like most people, there’s still plenty of injustice and suffering — your own and others’ — that you’ll prefer to experience before discovering what a sane, simple, workable system of economics looks like.

  42. earlofhuntingdon says:

    Oh, and Robber Barons paid no estate taxes. The Bush family trust funds stem, in part, from money made generations ago, which was made with money in hand before that.

    In two days, the estate tax will return to zero for a year. Throw Momma from the Train is likely to be one of Netflix’s most popular rentals. As Digby notes, about 15 people a day die who would have been subject to that tax, which should keep a few prosecutors busy checking the obituaries.

    The estate tax should return to pre-Bush levels in 2011. Before then, as Digby also notes, Rethuglicans will probably clamor for its permanent repeal. Expect Blanche Lincoln (D-Walton Family) and the senators from NY, CT and CA to join them. Billions would be lost to a bone-dry US Treasury, but a few thousand multi-millionaires would be generously grateful to a handful of Congresscritters for making their children fabulously wealthy all over again, without their having had to lift a finger.

  43. BayStateLibrul says:

    I’m having a Belichick Moment.
    Are we having a “mid-life” crisis?
    Massachusetts has mandates on health-care and the sky is not falling.
    Obama deserves some bashing but look at the alternatives.
    You think we have a third-party candidate for 2012.
    I’m fucking more concerned about fighting our fucking wars (6 GI’s just
    killed in Afgahnistan)…
    Unless I’m way naive, can’t we compromise…

    • earlofhuntingdon says:

      It’s a pity that those who make money, such as auto dealers, are so “popular” on Frank’s committee and on the Hill in general, but the people off whom they make money, often through predatory lending practices, are given such a Bronx cheer. People have to make that priority incur greater electoral consequences.

      • Loo Hoo. says:

        Yes, and perhaps the rookies needing money shouldn’t be on the committee next congress. Can that be changed by Frank? Pelosi? We need strong dems on the banking committees.

      • readerOfTeaLeaves says:

        EOH, I don’t know about the tax regs where you are, but in my state the auto (and house) sales tax is a huge part of the state’s tax structure.

        Consequently, realtors, home builders, and auto dealers have had disproportionately more heft in my state’s legislature than they would have under a one-citizen-one-vote scheme.

        Depending on a state’s tax structure, auto dealers can wield a great deal of political clout.

        Also agree that Robber Baron money originated from land grabs (including water rights, mining rights, sub-surface rights, coastal rights, and section land grabs) of the 1700s and 1800s.

  44. Michelle Elliott says:

    Since the beginning of the Bush administration (when, it is fair to say, I “woke up”), I have felt that the goal of the powers that be is to reduce everyone in the world — but especially Americans — to the status of Indentured Servant. They will not be content until 99.9% of the world’s population is living on swill, in hovels, and forced to beg for employment just to get that much. The old “tug the forelock” will serve as a reminder to all that democracy and egalitarianism have disappeared along with the middle class, forever.

      • Michelle Elliott says:

        That’s fine, you don’t have to agree. I’d love to believe you are right. But all I see is policies that seem tailored to destroying the American middle class. If it isn’t being done on purpose… Well, I suppose it could simply be incompetence.

  45. Mason says:

    Seems to me that unregulated capitalism always kills the goose that laid the golden eggs.

    In this metaphor, the goose is middle class consumption of goods and services and the golden eggs are the vast sums of money spent by the middle class to pay for those goods and services.

    The wealthiest 1% of our population that owns 90% of the wealth, which corresponds to your robber barons, is so miserably unhappy that it won’t be satisfied until it owns 100%. Ironically however, the destruction of the middle class by outsourcing jobs also killed demand, so inventories are high, prices are low, and still nobody can sell anything because no one has any money to buy it. Therefore,


    • earlofhuntingdon says:

      When they run out of their own geese, they steal yours and tell you – and the geese – that its for your own good.

      The old saw, riffing off Lord Acton’s pithy comment, is that all we learn from history is that we don’t learn from it. The rich will always be with us. They resist annihilation because there’s a little rich man in all of us, just as there is good and evil in all of us.

      The Founding Fathers understood that, hence, their separation of powers. We need to help separate them again.

    • Leen says:

      “immunize the wealthy from liability and social contributions, and to increase their share of wealth beyond reason”

      Cut taxes, loosen regulation, start unnecessary wars, billions for contractors..then drop the whole quagmire in the next administrations lap and then act like you had nothing to do with it and walk free.

  46. Blutodog says:

    “It is my hope to peg this phenomenon with a term simple, descriptive and instantly understandable by all,” Mussolini already gave it a name when he was asked for a definition of what was then being called Fascism. He called his policies CORPORATISM. I think it is exactly what were seeing today in the U.S. and elsewhere but especially here. The Congress is really little more now then a council of Corps. all jockeying for Gov’t $$ and favors. The blending of the two is becoming more and more the norm as individuals go through the increasingly large revolving door between Corp. suites and Gov’t depts. and even elected posts. This has to be stopped or altered if we are not to end up all of us being nothing more then modern day Corp. serfs. It is indeed a new form of feudalism.

  47. earlofhuntingdon says:

    Enjoy the knitting. Resist the temptation to cackle as the blade falls. It has a habit of becoming as undiscriminating as Donne’s bell: “[S]end not to know for whom the bell tolls, it tolls for thee.”

    Actually, the whole poem/reflection should remind the left that its main themes are universal and often good. It should brag about them, not hide them by moving to the right, whose themes of greed and ruthless selfishness are equally universal, but predatory:

    “No man is an island, entire of itself; every man is a piece of the continent, a part of the main. If a clod be washed away by the sea, Europe is the less, as well as if a promontory were, as well as if a manor of thy friend’s or of thine own were. Any man’s death diminishes me, because I am involved in mankind; and therefore never send to know for whom the bell tolls; it tolls for thee…”

    • skdadl says:

      I love it. And gosh oh golly, have we got a few snollygosters of our own here today. I better not write too much, because I have lost mine temper. I just hope that a lot of other people have too.

    • Loo Hoo. says:

      snollygoster. The words means a ”shrewd, unprincipled person, especially a politician”. It was first recorded in 1855 and fell out of use, before being re-introduced during British election coverage this year.

      Love it!

  48. Gitcheegumee says:

    Well, imho, this goes back -way back- before feudalism.

    All the way to the world’s oldest profession.

    We have all been pimped out ,folks, by the Bamboozler-in-chief.

    Boom shakka lackka…

  49. 1boringoldman says:

    “It is my hope to peg this phenomenon with a term simple, descriptive and instantly understandable by all, and to start a discussion both in comments to this post and in subsequent posts here and by others across the spectrum.”

    How about “rape.”

  50. klynn says:


    I am late to the EWheel and Lake today. Nonetheless, I am deeply thankful for your wonderful post.

    Many thanks.

  51. readerOfTeaLeaves says:

    EW, bmaz, MadDogs, klynn, EOF, scribe, Rayne, and other regulars: Grim, from the Guardian, but very much on topic with respect to a larger, longer theme on many threads here the past few years.

    Moore was targeted because he was a computer specialist installing a sophisticated tracking system that would show how vast amounts of international aid money from Iraqi institutions was diverted to Iran’s militia groups in Iraq….

    Moore, 37, a computer expert from Lincoln, and the four security guards were taken on 29 May 2007 from the Iraqi ministry of finance’s technology centre in central Baghdad. Moore had been a contractor working to install sophisticated new computer software in the ministry to track down billions of dollars in international aid and oil revenues.

    A former Iranian Revolutionary Guard member, speaking to the Guardian under conditions of anonymity, said the extraordinary kidnap was masterminded by Iran. The man, a former major who worked for 14 years inside the Iranian organisation and claims to have taken part in kidnap operations himself, believes the hostages were held in two al-Quds camps in Iran…

    A Guardian report in July revealed evidence that Iraqi officials colluded in the kidnap of the five British men and that one of the motives was to prevent millions of dollars of aid money from being tracked – including an estimated $18bn that had gone missing.

    A former senior Iraqi intelligence chief claims that the project that Moore was working on would have laid bare exactly where all Iraq’s money was going. He claims there was an Iranian link to the alleged financial cover-up…

    Fuck all.

    This is more than a ‘dot’, it’s a virtual information land mine.

  52. readerOfTeaLeaves says:

    A related Guardian article has even more details; some gory, but anyone reading here should definitely read this cluster of articles just up at the Guardian….

    The intelligence officers passed the news that the men were inside the mosque up the command chain at the Iraqi Ministry of Defence. It was still early in the afternoon. But to no avail. The next day – nearly 24 hours after the kidnapping the prisoners were on the move again….

    There was a window of some 17 hours to rescue the five British men but Iraqi intelligence officials were told not to tell anyone what they had seen.

    “They immediately told their boss, who called his boss at the Defence Ministry,” according to the Iraqi intelligence source. “The following day a message came back saying: ‘You must forget all about this subject, completely forget it, act as if you know nothing and tell your colleagues not to say a word’.”

    …”Everything in the prison gave the impression that they are in Iraq, not Iran: the guards, the buildings and even the cars. The uniforms used by security are all Iraqi to give the impression that they are being held in Iraq.”

    The major said he had no doubts the Iranian regime directly planned the kidnapping. …
    …”We killed them because we said we would kill them if our demands were not met. And we have lived up to our promises,” the Righteous League leader said in June, just before the first two bodies were found.

    An Iraqi intelligence source said: “The first four were killed soon after [the kidnapping]. They had no use for them. They are trouble. The computer expert was the valuable one.”…

    The events that led to the kidnappings began shortly after the US president, George Bush, ratcheted up the pressure on the Iranians with a televised address to the world warning Iran to stay out of Iraq and pull back their proxies.

    …designed to achieve two aims.

    The first was to halt the project Moore was working on. The sophisticated computer system being installed would have exposed any corrupt practices in the Ministry of Finance

    Eight months after the kidnappings, the only other location with a full record of the Iraqi government’s financial transactions and records of possible financial misconduct – Iraq’s Central Bank – was destroyed in a fire. The subsequent investigation found that it was arson.

    $18 billion missing, unaccounted for in Iraq, diverted to Iran?

    Brings to mind Nancy Pelosi’s “You don’t know the half of it”.
    And that McClatchy report about Iran punking that nest of brilliant geniuses that Cheney (and Bush) had placed inside the DoD: Wolfowitz, Cambone, Feith, etc.

    So I expect Cheney to pop his head around a corner and start smearing The, Obama, Hillary Clinton, and just about anyone else he views as ‘not a neocon ideologue’ just about any second now.

      • skdadl says:

        I’m trying not to prejudge. They could be service workers, y’know? Chefs, waiters? Our lovely (but now dead) journalist just blogged yesterday about a young hairdresser at the Kandahar base. There is a terrible class thing going on here.

  53. Leen says:

    Another “30” people were killed in Iraq today. Who was it that said that is always “30” who are killed by drones and “30” who die in Iraq. Heard that number again today on NPR

  54. bobschacht says:

    Sorry not to have read all the comments first, but this has been a busy travel day for me.

    Anyway, I like the “Robber Barons” label. Our government is becoming one that is of Robber Barons, for Robber Barons, and by Robber Barons. We need to bring back the trust-busters.

    Bob in AZ

    • readerOfTeaLeaves says:


      Anyway, I like the “Robber Barons” label. Our government is becoming one that is of Robber Barons, for Robber Barons, and by Robber Barons. We need to bring back the trust-busters.

      We need to bring back trust-busters, along with global cops, the end to tax havens, and somehow deal with governments that appear to be functioning like Mafia entities and drug lords, using the ‘cover’ of government status to claim rights that should not be granted them.

      Today, McClatchy once again hits it ‘outta the ballpark’ with a series on Goldman Sachs and their use of offshore accounting to create CDOs, then get the buyers to insure against GS losses (!).

      Meanwhile, in addition to my earlier Guardian links, here is one to a Guardian video (32 min; I’m only part way through but it’s still good enough to leave a link without watching all the way through).
      And yes, it is strange that this news about Iran is coming out now, but I do recall that it seemed creepy and strange when this kidnapping first occurred — but if the Guardian’s reporting is accurate, this was a state-government kidnapping that was disguised as a ‘terrorist’ incident. The financial implications are huge.

      • bmaz says:

        Yeah, that is more must reading as followup to the previous McCaltchy/NYT stuff in the Moganthau post I did the other day. It is sick, and it is freaking criminal if anybody will go after GS.

  55. readerOfTeaLeaves says:

    bmaz, I totally agree with you. But with respect particularly to this point in your post:

    The incontrovertible trend is toward an unholy blending of the robber barons with the government itself. Not just the usual influencing of government policies through lobbying and monetary control of individual politicians to seek favorable policies, but where the federal government becomes an appendage to do collections, enforcement and expansion for the corporations. The best time to rethink and reverse this trend is now, it will not get easier as the trend becomes more ingrained and pervasive with time.

    Then add onto your points, as supporting evidence with incredible data, the work put up by McClatchy today, including this bit:

    In 2006 and 2007, as the housing market peaked, Goldman underwrote $51 billion of deals in what mushroomed into an under-the-radar, $500 billion offshore frenzy, according to data from the financial services firm Dealogic. At least 31 Goldman deals in that period involved mortgages and other consumer loans and are still sheltered by the Caymans’ opaque regulatory apparatus.

    Tavakoli, an expert in these types of securities, said it’s time to start discussing “massive fraud in the financial markets” that she said stemmed from these offshore deals.

    I’m talking about hundreds of billions of dollars in securitizations,” she said, without singling out Goldman or any other dealer. ” . . . We nearly destroyed the global financial markets.”

    Then add to all of that, people installing computer security trying to track this type of mess being kidnapped in broad daylight by something like 100 well armed, well supplied men whose action was targeted at making sure that financial transactions could not be monitored on billions of dollars.

    The Russian Mafia and tinpot dictators must be laughing their asses off — they don’t have to fire a shot. All they need to do is buy ownership control of American corporations, which they will then use as lobbying fronts to implement their extortion plans.

    Just the way a retrovirus would behave in a globalized economic ‘free market’ chaotic, unregulated, opaque environment.


  56. maryo2 says:

    Deadweight economics

    Deadweight Loss – The deadweight loss of a subsidy is the amount by which the cost of the subsidy exceeds the gains in consumers’ and producers’ surpluses.

  57. joew says:

    The economic arrangement in the United States today is just another manifestation of what Engels identified over a century ago as State Capitalism.

    We have had it to some extent for a long time, but its power has grown in recent decades. Many nations have had it under many names, and sporting many disguises, but it is always the same steaming pile- even if you give it a trendy name like The Third Way, or A Kinder, Gentler Conservatism.

    State Capitalism is ultimately unsustainable, but terribly persistent. We would be wise to squelch it before it reaches that point at which it collapses on its own, because the collapse will be very destructive indeed.

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