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THE UNFULFILLED PROMISE
Posted by Time for change in General Discussion
Sun Jul 03rd 2011, 11:01 AM
It is insanity to allow financial predators (and criminals) to screw us over time after time, bailing them out of financial difficulty and giving them immunity from prosecution on the theory that we need them to run our economy.
Answer: A plutocracy – A government by the wealthy, for the wealthy.

The notion of “Too Big to Fail”, as applied to big banks in recent years, consists of the belief that we as a people can’t allow our biggest banks to fail because it would devastate our economy. That concept is used to justify multi-trillion dollar bailouts of these banks, at taxpayer expense. The fact that it is these same banks that are mainly responsible for ruining our economy is irrelevant to this line of thinking.

The idea of “Too Big to Prosecute” incorporates the same basic philosophy. It is used to justify immunity from prosecution, no matter how egregious the crimes committed by our largest financial institutions.


TOO BIG TO FAIL

A brief history of the Glass-Steagall legislation


A discussion of the concept of “Too big to fail” would be without context if it didn’t include mention of the New Deal era Glass-Steagall Act. Following the Stock Market Crash of 1929 and the beginning of the Great Depression of the 1930s (the worst depression in U.S. history) it became evident that the financial sector of our country had to be reigned in to avoid similar future occurrences. Too bad that lesson isn’t taught more in our schools – there are powerful interests in our country that would like us to forget all about it.

The origins of Glass-Steagall legislation
Paul Krugman explains the origins of our Glass-Steagall legislation in his book, “The Return of Depression Economics – and the Crisis of 2008”. Prior to the Great Depression of the 1930s, the United States had experienced periodic severe recessions and depressions, which were due largely to an unregulated financial system. Krugman explains why federal legislation was needed to remedy that problem:

Because they were supposed to engage only in low-risk activities, trusts were less regulated… than national banks. However, as the economy boomed during the first decade of the 20th century, trusts began speculating in real estate and the stock market, areas from which national banks were prohibited. Because they were less regulated than national banks, trusts were able to pay their depositors higher returns. Meanwhile, trusts took a free ride on national banks’ reputation for soundness… As a result, trusts grew rapidly… and the most severe banking crisis in history emerged in the early 1930s… precipitating a series of loan defaults followed by bank runs… There’s more or less unanimous agreement among economic historians that the banking crisis is what turned a nasty recession into the Great Depression.

The response was the creation of a system with many more safe guards. The Glass-Steagall Act separated banks into two kinds; commercial banks, which accepted deposits, and investment banks, which didn’t. Commercial banks were sharply restricted in the risks they could take; in return, they had ready access to credit from the Fed… their deposits were insured by the taxpayer. Investment banks were much less tightly regulated, but that was considered acceptable because as non-depository institutions they weren’t supposed to be subject to bank runs.

This new system protected the economy from financial crises for almost seventy years.

The repeal of Glass-Steagall
But with the deregulation craze of the Reagan years, the repeal of Glass-Steagall began. It wasn’t actually repealed during Reagan’s presidency. We had a heavily Democratic Congress at the time, and in those days that was sufficient to prevent the enactment of legislation meant to enrich the financial tycoons at the expense of the American people. So the Reagan administration simply refused to enforce Glass Steagall legislation. William Kleinknecht describes this process in his book, “The Man Who Sold the World – Ronald Reagan and the Betrayal of Main Street America”:

Reagan changed the role of government from that of watchdog to lapdog without even bothering to consult the Congress. He also gave a potent political voice to the backlash against regulations, ensuring that the movement would continue to burgeon after he left office… The Reaganites went after regulatory agencies with relish, starving them of resources and staffing them with officials committed to their destruction… The S&L mess worked out well for the new class of robber barons that emerged in the Reagan years. A small group of rich business types went on a spending spree, and the public picked up the $150 billion tab. Privatize the wealth and socialize the risk.

By the time that the Republican Party finally took over Congress, we had a Democratic president – Bill Clinton. But unfortunately, President Clinton fell under the sway of the financial sector. Consequently, in 1999 Congress passed, and Clinton signed the Financial Services Modernization Act, commonly known as the Gramm-Leach-Biley Act, which repealed Glass-Steagall. Kleinknecht describes the effects of that:

It was no surprise that the conflicts of interest and sleazy behavior that Glass-Steagall was designed to prevent quickly reappeared once the law was shelved… There were enormous sums of money to be made on Wall Street, and some of that wealth would be plowed into political campaign funds… Within two years after the repeal of Glass-Steagall, companies were inflating their earnings by billions of dollars…

This was the dawn of the George W. Bush era, when the ethos of Reaganism was once again enshrined as holy writ, so the stock market implosion of the millennium would not give rise to new banking regulation. Instead, the financial press continued to deify Greenspan, Rubin, and Reagan, and the country plunged headlong into the subprime mortgage scandal.

Nobel Prize-winning economist Joseph Stiglitz also commented on the significance of the repeal of Glass-Steagall:

Repeal changed an entire culture. Commercial banks are not supposed to be high risk ventures; they are supposed to manage other people’s money very conservatively. It is with this understanding that the government agrees to pick up the tab should they fail. Investment banks, on the other hand, have traditionally managed rich people’s money – people who can take bigger risks in order to get bigger returns. When repeal of Glass-Steagall brought investment and commercial banks together, the investment bank culture came out on top. There was a demand for the kind of returns that could be obtained only through high leverage and big risk taking.


The great bank bailouts – The epitome of socialized risk

The repeal of Glass-Steagall enabled huge banking institutions to take huge risks in a quest to make huge profits. But why was that such a big deal? The simple answer is that the banks were widely considered to be “too big to fail”. The risks taken by the most politically connected banks were taken with the firm knowledge that the U.S. government would bail them out with taxpayer money if they got into trouble.

As our more astute economists predicted, deregulation of the financial industry led to a near collapse of our national economic system and a severe financial crisis that is still with us today, several years later. But Wall Street came out of it just fine, thanks to a multi-trillion dollar taxpayer bailout.

The Paulson-Bush bailout
Robert Scheer explains, in “The Great American Stickup”, how the bailout began under President Bush’s Secretary of the Treasury, Henry Paulson, and worked for the benefit of Wall Street, especially for Goldman Sachs:

As (Treasury Secretary) Paulson moved to take over the U.S. Treasury Department he would bring with him the very same “experts’ whose financial follies had risked… Paulson used the banking crisis as a justification for quickly putting Goldman employees and alums in charge of key outposts concerning the bailout… which benefited Goldman enormously.

What we have here is a rare glimpse into the workings of the billionaires’ cub, that elite gang of perfectly legal loan sharks who in only the most egregious cases will be judged as criminals… These amoral sharks, who confiscated billions from shareholders and the 401(k) accounts of innocent victims, were rewarded handsomely, rarely needing to break the laws their lobbyists had purchased…

In September 2008 came {Paulson’s} infamous three-page, take-it-or-leave-it proposal to Congress that the government fork over $700 billion in bailout funds, and he was successful in insisting that no strings be attached in the form of punishment for CEOs, oversight or control of bonuses… Basically they gave Congress a ransom note: “We’ve got your 401(k) and if you want to see your 401(k) alive again, give us $700 billion in unmarked bills”. The threat worked, and the bailout intrusion into the ostensibly free market of a scope unprecedented in U.S. history passed by a wide margin in Congress, with few questions asked…

The Obama/Geithner plan
The bailout continued under the Obama administration. As the Obama administration was considering putting Treasury Secretary Tim Geithner’s plan into effect – which was largely a continuation of the Bush administration plan – several eminent non-corporate economists warned them and us of the consequences. They used different words, but their basic description of the Geithner plan was the same: a reverse Robin Hood scheme, conducted behind closed doors. Economists who warned us of the problem included Paul Krugman, Joseph Stiglitz, Robert Reich, Dean Baker, and James Galbraith. I’ve discussed these warnings in detail in a previous post, so here I’ll just mention what Joseph Stiglitz had to say about it:

The U.S. government plan to rid banks of toxic assets will rob American taxpayers by exposing them to too much risk and is unlikely to work as long as the economy remains weak…. The U.S. government is basically using the taxpayer to guarantee against downside risk on the value of these assets, while giving the upside, or potential profits, to private investors… Quite frankly, this amounts to robbery of the American people. I don't think it's going to work…

The magnitude of our bank bailout
One of the biggest problems with our bailout of the banks was the lack of transparency of the whole process. According to the Special Inspector General for the TARP program:

TARP largely remains a program in which taxpayers are not being told what most of the TARP recipients are doing with their money and will not be told the full details of how their money is being invested.

But that’s not the worst of it. According to Nomi Prins and Christopher Hayes, writing in The Nation:

TARP was but a small fraction (roughly 4 percent) of the full $17.5 trillion bailout and subsidization of the financial sector. The details of this total bailout are complicated, but the basic mechanisms aren’t beyond the average citizen’s grasp... Given the banks’ newfound publicly sponsored financial health, Washington has little incentive to rock the boat by proposing serious reforms….

Lack of accountability seems to be something of a theme. Despite conducting themselves recklessly, compulsively, almost sociopathically, {the banks} got a lot of money to help maintain their lifestyle and assets. But what happens when they take all that money and double down on the wrong bet? Will they be back for another helping? Why wouldn’t they be? Given everything our government has said and done so far, and the meager reform ideas on the table, it’s very likely there will be another bad bet coming from the entire industry – and with it, the vaporizing of much of the assistance doled out to avoid that very occurrence.

In other words, we spent trillions of dollars to restore financial health to the big banks, in the belief (or excuse) that it was necessary for our economy, and we received almost nothing in return – not even legislation to prevent the same thing from happening again.


TOO BIG TO PROSECUTE

Perhaps the greatest indicator of the tyranny of corporate power in America today is the approach that our criminal justice system takes towards corporate criminals. Our country is still suffering from our worst financial crisis since the Great Depression of the 1930s, which is largely the result of corporate irresponsibility and malfeasance. Yet not one of those responsible for this crisis has even been prosecuted, let alone sent to jail. To the contrary, the American taxpayers have bailed out our irresponsible financial institutions to the tune of several trillion dollars.

William Greider explains, in an article titled “How Wall Street Crooks Get out of Jail Free”:

The nation is left to face a disturbing spectacle: crime without punishment. Massive injuries were done to millions of people by reckless bankers, and vast wealth was destroyed by elaborate financial deceptions. Yet there are no culprits to be held responsible.

Former U.S. Senator Ted Kaufman put the problem in perspective:

People know that if they rob a bank they will go to jail… Bankers should know that if they rob people, they will go to jail too… At the end of the day this is a test of whether we have one justice system in this country or two. If we do not treat a Wall Street firm that defrauded investors of millions of dollars the same way we treat someone who stole $500 from a cash register, then how can we expect our citizens to have any faith in the rule of law?

Greider explains the system that is routinely used in the United States today to deal with corporate criminals, and its purported rationale:

Instead of “Old Testament justice,” federal prosecutors seek “authentic cooperation” from corporations in trouble, urging them to come forward voluntarily and reveal their illegalities. In exchange, prosecutors will offer a deal. If companies pay the fine set by the prosecutor and submit to probationary terms for good behavior… then government will defer prosecution indefinitely or even drop it entirely.

The favored argument for the more conciliatory approach was that criminal indictment may amount to a death sentence for a corporation. The fallout will destroy it, and the economy will lose valuable productive capacity. The collateral consequences are unfair to employees who lose jobs and stockholders who lose wealth.

That’s a lot of sympathy for corporations, corporate employees and stockholders. Where is the comparative sympathy for the tens of millions of other Americans who are out of work or who lost their homes?

Russell Mokhiber, longtime editor of the Corporate Crime Reporter, explains the real reason for this kid glove treatment of corporate criminals:

Over the past twenty-five years the corporate lobbies have watered down the corporate criminal justice system and starved the prosecutorial agencies. Young prosecutors dare not overstep their bounds for fear of jeopardizing the cash prize at the end of the rainbow – partnership in the big corporate defense law firms after they leave public service. The result – if there are criminal prosecutions, they now end in deferred or nonprosecution agreements instead of guilty pleas.

Greider continues:

Deferring prosecution was made standard practice by George W. Bush’s Justice Department… During Obama’s first two years, Justice deferred action on fifty-three corporate defendants… Leading lawyers dubbed deferred prosecution “the new normal for handling corporate misconduct”.

In other words, they have more money than we do, and in today’s United States, justice is for sale.


New York’s Attorney general takes on the banks

New York’s new attorney general, Eric Schneiderman, has been aggressively pursuing bank fraud connected with the housing foreclosure crisis. In today’s world that takes a lot of courage, as William Greider explains in an article on the subject:

Law-enforcement agencies, state and federal, have not undertaken a thorough investigation of the scandal… The newly elected New York AG has been obliquely warned that his inquiry could “blow up the economy,” but he ignores the scare talk…. In recent months, Schneiderman’s office has dispatched requests for records and information from seven of the biggest banks… the leading players in the housing bubble, either by originating subprime mortgages of dubious quality or by packaging the mortgage-backed securities that turned into toxic assets for unwitting investors…

In parallel with Schneiderman’s investigation, homeowners have been taking matters into their own hands – and winning in court. Greider explains:

Around the country, lawyers for homeowners have won scores of cases blocking banks from foreclosing on their clients. Courts have held that mortgages or securities were fatally flawed and therefore void. Banks filed false affidavits and unsupported documents, in effect defrauding the courts. When judges asked for backup evidence of ownership, lawyers went to the trustees and found that the mortgages and liens were not in the files. Bankers couldn’t prove they owned the homes they were seizing. Often they couldn’t even establish who owned the loans or whether borrowers were actually in default. Many documents were signed by untrained functionaries who didn’t bother to examine what they were signing…. The most prestigious financial firms abused and distorted the system in their rush to accumulate greater profit…

Greider explains why the situation is so serious:

The essential meaning was described by Damon Silvers, AFL-CIO associate general counsel… “Here’s why all this is so dangerous,” he explained. “Property law requires very precise documentation at every step in the process because the whole economy comes apart if you can’t be certain who owns what. When you buy a house, the bank insists you comply with the property-law regime, and you sign pages and pages of agreements to do so. And you can lose your home if you fail to comply. Yet in this situation the banks did not comply themselves—that’s what’s mind-boggling.” …

The legal fallout promises to produce a nightmare of litigation as indebted homeowners and defrauded investors press their arguments that the bankers’ claims are fraudulent or at least void because they do not fulfill legal requirements… In the extreme case, a deeper investigation may establish criminal liability for executives if they knowingly consented to deceiving investors, borrowers, bankruptcy courts or regulators…


Federal government siding with the financial tycoons on this issue

One of my biggest complaints about President Obama (and I have many) has been his consistent siding with the financial tycoons, to the detriment of ordinary Americans. Greider explains this phenomenon as it relates to the housing foreclosure crisis:

As facts about the banks’ ugly behavior gathered headlines, the fifty state attorneys general came together to demand reforms… The Obama administration is eager to get a settlement, fearing that state-by-state litigation will injure the banks…

Genuine relief for the mortgage scandal should help stanch the slow bleeding of failing debtors, but relief should also help the economy to recover. The operative principle should be that everyone takes a hit, with creditors as well as debtors sharing the pain. But that’s not how the Obama administration has proceeded. Government interventions have generally tried to shield banks and other creditors from swallowing the cost of their financial follies, presumably because officials think that would damage the economy.
The banker-friendly logic has not been confirmed by events. Housing prices are still falling, and more and more families are sinking under water. The housing sector, long the backbone of the national economy, remains moribund. Banks are healing but still not lending…

A major intervention in housing might… compel the banks to take a big hit – a much bigger price tag than anything now discussed… The bankers’ billions would essentially pay for a mandatory debt workout program for drowning households – reducing the principal and interest payments on mortgage debt so they can gradually recover… Banks have naturally resisted any settlement like this (so has Treasury Secretary Tim Geithner). Maybe the banks and their political cheerleaders will be softened up if Eric Schneiderman and other AGs begin to nail them with hard facts and costly legal judgments…


WHAT KIND OF COUNTRY PERMITS THIS KIND OF NONSENSE?

Much of the fraud perpetrated by the financial elites upon the American people is legal or quasi-legal, due to gaping holes in the system – holes demanded by the financial elites themselves. But they don’t shy away from outright fraud either – largely because they know that even when they get caught they will receive a slap on the hand at worst. Matt Taibbi describes how this works, in his book, Griftopia: Bubble Machines, Vampire Squids, and the Long Con That is Breaking America:

The banks had changed the rules of the game, making the deals look better than they were, setting up what was in reality a two-tiered investment system – one for bankers and insiders who knew the real numbers, and another for the lay investor…

A 2002 House Financial Services Committee report showed that in twenty-one different instances, Goldman gave top executives in companies they took public special stock offerings that in most cases were quickly sold at a huge profit… Goldman agreed to settle with New York Attorney General Eliot Spitzer, who accused Goldman, along with eleven other companies, of spinning and issuing bogus buy ratings of stocks. Here Goldman again got off easy, paying just $50 million… In return, Goldman again got to avoid formally pleading guilty to any charges, and regulators agreed to forgo charges against its chief executives, who at the time included Hank Paulson… The House Committee concluded that Goldman’s analysts had kept issuing “buy” recommendations long after the value of the stocks had fallen…

How does a bank make money selling gigantic packages of grade-D horseshit? Easy: it bets against the stuff as it’s selling it! What was truly amazing about Goldman was the sheer balls it showed during its handling of the housing business. First it had the gall to take all this hideous, completely irresponsible mortgage lending from beneath-gangster-status firms like Countrywide and sell it to pensioners and municipalities, old people for God’s sake, and pretend the whole time that it wasn’t toxic waste. But at the same time, it took short positions in the same market, in essence betting against the same crap it was selling…

Goldman announces that it will be converting from an investment bank to a bank holding company – a move that allows it access not only to $10 billion in TARP funds but to a whole galaxy of less conspicuous publicly backed funding sources… No one knows how much either bank borrows (Goldman and Morgan Stanley) from the Fed, but by the end of the year upwards of $3 trillion will have been lent out by the Fed under a series of new bailout programs – and thanks to an obscure law allowing the Fed to block most congressional audits, both the amounts and the recipients of these monies remain almost entirely secret…

I acknowledge that there is some truth to the notion that it is important for our government to take steps to prevent our financial institutions from failing. But since the onset of the Reagan administration, our government has gone way beyond that. We have systematically dismantled protections that were put in place during the New Deal era, specifically created to prevent the kind of economic disaster that we saw in the 1930s.

Predatory financial institutions lobby our government to relax regulations that have served to protect the American people against economic catastrophe. Then they take advantage of the relaxed regulations by engaging in extremely risky behavior, knowing that the American taxpayer will bail them out when they get in trouble. Then they use the bailout money, not to serve the American public who bailed them out, but to enrich themselves. In the process, they engage in highly unethical and irresponsible behavior, and even outright fraud, knowing that their transgressions will be handled with kid gloves even when caught.

The excuse that our elected representatives use to explain why they allow this type of behavior is that these financial institutions are too important to our economy to allow them to fail. And presumably they are also too important to allow to be prosecuted for their crimes or even to be regulated. Regulation, they claim, is akin to socialism!!

I’ve had enough of this nonsense. The real reasons for this type of behavior by our elected representatives are not at all what they claim. The primary reason is that they rely on these institutions for campaign contributions and other related favors. Major financial institutions in our country (as well as many other corporations) have become way too big and way too powerful. When the wealthy are allowed to engage in risky and irresponsible behavior at public expense without the risk of facing the consequences; when they are allowed to engage in criminal behavior without the risk of punishment, we should recognize that our situation is out of hand. I say, prosecute them for their crimes, to the full extent of the law, and let them fail when they have proven over and over again that they do not exist to serve a public purpose, but only for their own enrichment.

It is insanity to allow financial predators (and criminals) to screw us over time after time, bailing them out of financial difficulty and giving them immunity from prosecution on the theory that we need them to run our economy. Our elected representatives who enable this type of behavior should be voted out of office and replaced by those who will represent the American people over a small minority of wealthy interests.
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The Unfulfilled Promise
The Unfulfilled Promise of the American Dream: The Widening Gap between the Reality of the United States and its Highest Ideals




Time for change


Notwithstanding the lofty sentiments and purpose of the U.S. Declaration of Independence, the reality of the United States of America did not then – and never has – lived up to its ideal. Our nation remains today a long way from fulfilling the promise implied by those ideals. Yet, our Declaration was a great start, and it has long shone as a beacon of hope for people all over the world.

Throughout our history, while many have striven to close the gap between our highest ideals and the reality of our nation, others have focused on the accumulation of private wealth and power, at the expense of everyone else. In recent decades the latter have gained much ground, leading to increasing imperialism abroad and deteriorating democracy at home, characterized by routine (and legal) bribery of our public officials, the fusion of government and private corporate interests (corporatocracy), a corrupt election system largely in the hands of private corporations, a corporate controlled communications media, and the widespread acceptance of Executive Branch secrecy, routinely justified with little if any questioning, by the magic words “national security”. All of this is rapidly turning our country from the democracy proclaimed at our founding into a plutocracy (government by the wealthy and for the wealthy). The result is the most obscene wealth gap our country has ever known, the highest imprisonment rate in the world, rampant militarism, routine flaunting of international law, the least efficient health care system in the developed world, a pending environmental catastrophe that threatens to destroy the life sustaining forces of our planet, and myriad other problems that threaten to destroy our nation and tyrannize our people.

My new book, The Unfulfilled Promise of the American Dream – The Widening Gap between the Reality of the United States and its Highest Ideals, explores the roots and consequences of the demise of our democracy, and why most Americans have been unable to understand this process or even become aware of it. A good understanding of why and how we have deviated so greatly from the ideals of our nation is the first and necessary step towards getting back on the right track and revitalizing our society.

The book is currently being sold in electronic PDF format and can be purchased at http://www.unfulfilledpromise.com/Buy-the-... for $3.99. It will also soon be available in Amazon Kindle format. DU members who cannot afford to buy the book but would like to read it can pm me with your e-mail address, and I will send you a free PDF copy.

I’ve previously posted on DU a slightly earlier version of the introduction to the book, which is also posted at my site. Here is the Table of Contents, followed by a brief description of the three parts of the book:


TABLE OF CONTENTS

Introduction
Acknowledgements
Prologue – What is Wrong with the United States of America?

Part I – Root Causes of the Impending Demise of American Democracy
Chapter 1 – Legalized Bribery
Chapter 2 – Human Psychological Factors
Chapter 3 – Corporatocracy
Chapter 4 – Corporate Control of Media
Chapter 5 – Corrupt Election System
Chapter 6 – Government Secrecy
Chapter 7 – American Exceptionalism

Part II – A Sampling of Imperialist Actions
Chapter 8 – Slavery and its Legacy
Chapter 9 – Early U.S. Imperialism
Chapter 10 – U.S. Imperialism in Cold War
Chapter 11 – Iraq War and Occupation
Chapter 12 – Afghanistan War

Part III – Consequences
Chapter 13 – Election of George W. Bush
Chapter 14 – War and Imperialism
Chapter 15 – Class Warfare
Chapter 16 – Predator Financial Class
Chapter 17 – Shock Therapy
Chapter 18 – Contempt for Int. Law
Chapter 19 – The “War on Drugs”
Chapter 20 – Climate Change
Chapter 21 – “War on Terror”
Chapter 22 – Health Care
Chapter 23 – Unaccountable government
Chapter 24 – Response to 9/11 Attacks
Epilogue


PART I – Root Causes of the Impending Demise of American Democracy

It is somewhat difficult to separate the causes of our problems from their consequences, since they combine to form a long chain of cause leading to consequence, leading to more consequences, etcetera. Nevertheless, it seems worth while to identify the root causes of our problems, those that occur early in the chain and lead to so many of the tragic consequences we see today. The only chance we have of reversing the demise of our democracy is through addressing and attacking its root causes.

At the top of the list is the systematic bribery of public officials by the powerful corporations (Chapter 1) whom our government is charged with regulating in the public interest. Instead of calling it bribery, we call it “campaign contributions”, but what we call it isn’t as important as what it is. It is hard to fathom how democracy can survive when such a practice is legal and condoned.

Working in tandem with our system of legalized bribery is the nature of the people who inhabit our country. That is not to say that Americans are inherently substantially different than any other people. Human beings are imperfect, and that is probably a major reason why in a world where civilization began more than five millennia ago, the oldest written national framework of government in the world today – the Constitution of the United States of America – is only a little more than two and a quarter centuries old. Chapter 2 explores the roles of basic human needs, authoritarianism, psychological defense mechanisms used to prevent us from perceiving reality as it is rather than as we’d like it to be, and corrupted ideologies in causing us to passively accept the accumulation of power in the hands of ambitious and ruthless individuals who care about little else than expanding their own wealth and power.

When bribery of public officials is tolerated as an inevitable aspect of public life, government inevitably grows close to the wealthy interests that shower it with money in return for legislative and other favors. A malevolent symbiosis grows between the state and corporate power, resulting in rule by an oligarchy that is highly detrimental to the lives of ordinary people (Chapter 3). Using their accumulated wealth and power to manipulate our legislative process, the oligarchy grabs for more and more control of the communications media (Chapter 4) that are used to control the information available to and shape the attitudes of our nation’s people, in pursuit of their own narrow interests.

Since the 1980s an orchestrated campaign has been underway to demonize “big government”, thereby paving the way for private corporate control over more and more functions that were previously deemed intrinsic functions of government. Among those functions is the running of public elections (Chapter 5) – the function that symbolizes democracy perhaps more than any other single function. Consequently, the purging of selected registered voters from our computerized voter rolls has become a routine recurring event throughout much of our country, and without a doubt determined the results of the 2000 – and probably 2004 as well – presidential election. Just as bad, more and more of the counting of votes in our public elections have been turned over to private corporations, which count our votes using electronic machines using secret software to produce vote counts that cannot be verified by anyone.

Bribery, the fusion of government and private interest, fake and biased news, and corrupt elections are not things that government and its corporate allies want us to know about. Consequently, they construct walls of secrecy (Chapter 6) to keep us from obtaining information that sheds light on their activities. The perfect phrase for facilitating this is “national security”. When our government tells us that the “national security” requires that certain things be kept secret from us, the understanding is that to question such a pronouncement is unpatriotic, and to actually attempt to obtain the “secret” information may be treasonous.

But indefinitely maintaining secrets from the American people can be very difficult, because at least some people want to know what their government is up to. So in addition to the formal mechanisms of secrecy, informal mechanisms are constructed (Chapter 7) to keep vital information away from us. One of the primary methods for doing this is to make certain sensitive subjects taboo – that is, to create the widespread belief that discussion of these topics is so outside the bounds of acceptable human discourse that anyone who discusses them should be shunned by society, or worse. The most common issue that falls into this category is any discussion that sheds light on the disparity between American ideals and the reality of life in our country today.


PART II – A Sampling of Imperialist Actions in U.S. History

Notwithstanding the fact that our founding document says that “all men are created equal” and speaks of the inalienable rights of humankind, the United States has throughout its history partaken of massive exploitation of other peoples.

It is estimated that at the time of our birth, 18% of our population was black slaves. In our expansion westwards during the late 18th and 19th centuries, we decimated the original inhabitants of our continent, and often treated them with great cruelty. In 1846 we manufactured an excuse for war with our neighbor Mexico, in which we continued to expand our country westwards and southwards. In 1893 we began our overseas imperialism with the conquest of Hawaii. Our overseas expansion was greatly accelerated in 1898 with our participation in the Spanish-American War, which led to our conquest of Cuba, Puerto Rico, and the Philippines. With our arrival at world superpower status at the end of World War II, we began the Cold War, which led to and served as a rationalization for covert and/or direct military actions against myriad foreign nations over the next 46 years. With the September 11, 2001 attacks on our country, we declared a perpetual “War on Terror”, which served and continues to serve as an excuse to invade and occupy Iraq and Afghanistan, nations that posed no threat to us. We do not know when or if this perpetual war will ever end. We don’t know how many additional imperial conquests it will lead to.

Most Americans don’t think much about all this. Many of these actions are done in secrecy, and the American people don’t find out about them until many years later – or we never find out about them at all. Those that we do know about are spun into the most favorable light, to make them seem benign or even noble.

But these actions come at great costs: in the lives of our soldiers; in the ruined lives of the peoples of the victim countries; in trillions of dollars cost to our people and their future generations; in our international reputation; in anti-American hatred leading to terrorism; and, to our democracy itself. For how can a nation claim to believe in the inalienable rights of humankind specified in its founding document, while making a mockery of that belief in the way it treats other peoples? For that reason alone it is worth while to take a brief look at our long history of imperialist actions.


PART III – Consequences

In the Prologue I give a brief account of what I see as some of the worst and tragic consequences of the root causes that I discuss in Part I – to enable the reader to see where this book is heading. When elections of our public officials are for sale to the highest bidder… when our public officials are so addicted to the “campaign contributions” of their wealthiest constituents that they develop a symbiotic relationship with them… when our communications media are owned and controlled by an oligarchy of wealthy elites… when our citizenry lack the ability to differentiate propaganda from reality… when we allow machines provided by private corporations to count our votes using secret electronic software… then we should expect that the consequences will not be pretty or comfortable for the vast majority of our citizens.

In Part III, I explore those consequences in much greater detail, in the hope that the reader will agree with me that these are very serious problems, and that they must be successfully addressed if our country is ever to fulfill the promise of its ideals, or even make progress in that direction. When enough Americans recognize our problems as problems, stripped of the gloss and spin put on them by our oligarchy, they will rise up and do something about them. Until then there will be no progress, and we are very likely to head in the direction of all the former empires of our planet, ending in chaos, widespread catastrophe, suffering, and ignominy.

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Time for change
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12582 posts
Member since Thu Dec 2nd 2004
Silver Spring, MD, US
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