Cataclysmic Capitalism

We need to divest ourselves of the delusion that we live in a free market economy. We don’t. Rather, according to one observer, we live in a “corporate republic” where the “profits are privatized” and the “risks are socialized”. This means that a reckless investment is backed by the government which in turn is incentive for more reckless investment. In short, Wall Street is practicing “no risk capitalism”.

This is exactly what is happening today, i.e. the bail out of the “Wall Street Casino” by the federal government. The refusal by the corporations to accept regulation even when there are laws on the books forces the government to step in to prevent the economy from tanking. The regulators in collusion with the corporations won’t regulate. The rating agencies, Standard and Poor’s and Moody’s, paid by the corporations, hand out triple A ratings to corporations that in many cases are junk making them eligible for leveraged loans to the tune of 30 to 40 times their assets. (In actuality there are possibly only a half dozen companies among hundreds that are really AAA.) And this was the major cause of the crash. But on top of this, mortgage lenders were conning potential home buyers into borrowing beyond their means (sub-prime) until the housing market crashed also.

Now how does this corporate state affect our foreign policy? A multi-national corporation operating in a foreign country may find its profit negatively impacted by certain demands put on the company by the local government, e.g. new laws or new taxes. The US politicians interpret this as harassment of the corporation. It is anti-American and repressive. So it becomes necessary to “intervene”. That intervention quite often entails regime change which requires military intrusion in the form of a coup or actual invasion. The American public is then propagandized to support the intrusion because the cruel and corrupt government is interfering with the right of an American international corporation to exploit the poor of the country. However, it is presented to the American people as a “struggle between good and evil”. A military intervention would, of course, create a cataclysmic disaster in essentially a peaceful country. Then we send in Halliburton and/or Bechtel ostensibly to fix the disaster we have created. Disaster capitalism makes it possible to profit from the mayhem. Catastrophe is good for profit. It’s good to be king.


References:

Galbraith, James K. The Predator State. 2008
Klein, Naomi. The Shock Doctrine. 2007