When it comes to social conditions, it’s important to recognize that nearly 50 million Americans now live in poverty—one in six. If you’re in poverty in America, you’re living on less than $400 per week for a family of four. Poverty is the bleeding edge of a more pervasive American shortcoming—massive economic insecurity. About half of American families now live paycheck to paycheck, are financially fragile, and earn less than needed to cover basic living expenses, let alone save for the future.
Back in 1928, right before the Great Depression, the richest 1 percent of Americans received 24 percent of the country’s total income. Starting with the New Deal, public policy favored greater equality and a strong middle class, so that by 1976, the share of the richest 1 percent of households had dropped to 9 percent. But then the great re-redistribution began in the 1980s, so that by 2007, right before the Great Recession, the richest 1 percent had regained its 1928 position—with 24 percent of income.
As for national security, the U.S. now spends almost as much on the military as the rest of the world combined. If one totals military and other U.S. security spending, the total easily climbs to over $1 trillion annually, about two-thirds of all discretionary federal spending. In what has been called a key feature of the American Empire, America now garrisons the world. Although the Pentagon officially reports that we maintain a mere 660 military bases in 38 countries, if one adds the unreported bases in Afghanistan, Saudi Arabia, and elsewhere, there are likely as many as 1,000 U.S. military sites around the world. By 2010, we had covert operations deployed in an estimated 40 percent of the world’s 192 nations. On the home front, in 2010, the Washington Post reported that the top-secret world the government created in response to 9/11 now contains some 1,300 government entities and 1,900 private companies all working on programs related to counterterrorism, homeland security, and intelligence in some 10,000 locations across the United States.
When you’ve got an armful of hammers, every problem looks like a nail, and the U.S. has tended to seek military solutions to problems that might be addressed otherwise. The costs have been phenomenally high. When all told, our wars since 9/11 will cost us over $4 trillion and more than 8,000 American lives, with another 99,000 U.S. troops already wounded in action or evacuated for serious illness.
Another sorrow is the huge, draining psychological burden that U.S. actions have on its citizens. We see our own military, the CIA, and U.S. contractors engaged in torture and prisoner abuse, large killings of innocent civilians, murders and the taking of body parts as souvenirs, renditions, drone assassinations, military detention without trial, collaboration with unsavory regimes, and more.
Meanwhile, outside our borders, a world of wounds has festered without much help, and often with harm, from the United States. We are neglecting so many problems—from world poverty, underdevelopment, and climate change to emerging shortages of food and water and energy, biological impoverishment, and transnational organized crime.
The following are among the many treaties ratified by all nations, except for a few rogue states—and the United States: the Convention of the Rights of the Child, the Convention Against All Forms of Discrimination Against Women, the Land Mine Convention, the International Criminal Court convention, the Biodiversity Convention, the Law of the Sea, the Kyoto Protocol of the Climate Convention, and the Convention on Persistent Organic Pollutants. The U.S. is the main reason we do not now have a World Environment Organization.
In these respects and in many others, the U.S. posture in the world reflects a radical imbalance: a hugely disproportionate focus on the military and on economic issues and a tragic neglect of some of the most serious challenges we and the world now confront.
These many challenges require farsighted, strong, and effective government leadership and action. Inevitably, then, the path to responding to these challenges leads to the political arena, where a vital, muscular democracy steered by an informed and engaged citizenry is needed. That’s the democracy we need, but, unfortunately, it is not the democracy we have. Right now, Washington isn’t even trying to seriously address most of these challenges. Neglect, stalemate, and denial rule the day. It is estimated that American politics is more polarized today than at any time since Reconstruction. Polarization, of course, is father to gridlock. Gridlock and stalemate are the last thing our country needs now.
The American political system is in deep trouble for another reason—it is moving from democracy to plutocracy and corporatocracy, supported by the ascendancy of market fundamentalism and a strident antiregulation, antigovernment, antitax ideology. The hard truth is that our political system today is simply incapable of meeting the great challenges described here. What we have is third-rate governance at a time when the challenges we face require first-rate governance.
America thus confronts a daunting array of challenges in the maintenance of our people’s well-being, in the conduct of our international affairs, in the management of our planet’s natural assets, and in the workings of our politics. Taken together, these challenges place in grave peril much that we hold dear.
The America we must seek for our children and grandchildren is not the America we have today. If we are going to change things for the better, we must first understand the forces that led us to this sea of troubles. When big problems emerge across the entire spectrum of national life, it cannot be due to small reasons. We have encompassing problems because of fundamental flaws in our economic and political system. By understanding these flaws, we can end them and move forward in a very different direction.
I think America got off course for two primary reasons. In recent decades we failed to build consistently on the foundations laid by the New Deal, by Franklin Roosevelt’s Four Freedoms and his Second Bill of Rights, and Eleanor Roosevelt’s Universal Declaration of Human Rights. Instead, we unleashed a virulent, fast-growing strain of corporate-consumerist capitalism. “Ours is the Ruthless Economy,” say Paul Samuelson and William Nordhaus in their influential textbook, Macroeconomics. And indeed it is. In its ruthlessness at home and abroad, it creates a world of wounds. As it strengthens and grows, those wounds deepen and multiply.
Such an economy begs for restraint and guidance in the public interest—control that can only be provided by government. Yet, at this point, the captains of our economic life and those who have benefited disproportionately from it have largely taken over our political life. Corporations, long identified as our principal economic actors, are now also our principal political actors. The result is a combined economic and political system—the operating system upon which our society runs—of great power and voraciousness, pursuing its own economic interests without serious concern for the values of fairness, justice, or sustainability that democratic government might have provided.
Our political economy has evolved and gathered force in parallel with the course of the Cold War and the growth of the American Security State. The Cold War and the rise of the American Empire have powerfully affected the nature of the political-economic system—strengthening the already existing prioritization of economic growth, giving rise to the military-industrial complex, and draining time, attention, and money away from domestic needs and emerging international challenges. This diversion of attention and resources continues with our response to international terrorism.
So what are this operating system’s key features, which have been given such free rein by these developments? First, ours is an economy that prioritizes economic growth above all else. We think of growth as an unalloyed good, but this growth fetish is a big source of our problems. We’ve had plenty of growth in recent decades—growth while wages stagnated, jobs fled our borders, life satisfaction flat-lined, social capital eroded, poverty and inequality mounted, and the environment declined. Today, U.S. GDP has regained its prerecession level, but 15 percent of American workers still can’t find full-time jobs.
Another key feature of today’s dysfunctional operating system is how powerfully the profit motive affects corporate behavior. Today’s corporations have been called “externalizing machines,” so committed are they to keeping the real costs of their activities off their books. Profit can be increased by keeping wages low and real social, environmental, and economic costs externalized—borne by society at large and not by the firm. One can get some measure of these external costs from a recent analysis of three thousand of the world’s biggest companies. It concluded that paying for their external environmental costs would erase at least a third of their profits. Profits can also be increased through subsidies, tax breaks, regulatory loopholes, and other gifts from government. Together, these external costs and subsidies lead to dishonest prices, which in turn lead consumers to spur on businesses that do serious damage to people and planet.
Given such emphasis on inexorable growth and profit, the constant spread of the market into new areas can be very costly environmentally and socially. As Karl Polanyi described in his 1944 book, The Great Transformation, “To allow the market mechanism to be sole director of the fate of human beings and their natural environment . . . would result in the demolition of society. . . . Nature would be reduced to its elements, neighborhoods and landscapes defiled, rivers polluted, military safety jeopardized, the power to produce food and raw materials destroyed.” With its emphasis on privatization, commercialization, and commodification, American capitalism has carried this demolition forward with a vengeance.
But the system that drives the capitalism we have today includes other elements.
Back in 1928, right before the Great Depression, the richest 1 percent of Americans received 24 percent of the country’s total income. Starting with the New Deal, public policy favored greater equality and a strong middle class, so that by 1976, the share of the richest 1 percent of households had dropped to 9 percent. But then the great re-redistribution began in the 1980s, so that by 2007, right before the Great Recession, the richest 1 percent had regained its 1928 position—with 24 percent of income.As for national security, the U.S. now spends almost as much on the military as the rest of the world combined. If one totals military and other U.S. security spending, the total easily climbs to over $1 trillion annually, about two-thirds of all discretionary federal spending. In what has been called a key feature of the American Empire, America now garrisons the world. Although the Pentagon officially reports that we maintain a mere 660 military bases in 38 countries, if one adds the unreported bases in Afghanistan, Saudi Arabia, and elsewhere, there are likely as many as 1,000 U.S. military sites around the world. By 2010, we had covert operations deployed in an estimated 40 percent of the world’s 192 nations. On the home front, in 2010, the Washington Post reported that the top-secret world the government created in response to 9/11 now contains some 1,300 government entities and 1,900 private companies all working on programs related to counterterrorism, homeland security, and intelligence in some 10,000 locations across the United States.
When you’ve got an armful of hammers, every problem looks like a nail, and the U.S. has tended to seek military solutions to problems that might be addressed otherwise. The costs have been phenomenally high. When all told, our wars since 9/11 will cost us over $4 trillion and more than 8,000 American lives, with another 99,000 U.S. troops already wounded in action or evacuated for serious illness.
Another sorrow is the huge, draining psychological burden that U.S. actions have on its citizens. We see our own military, the CIA, and U.S. contractors engaged in torture and prisoner abuse, large killings of innocent civilians, murders and the taking of body parts as souvenirs, renditions, drone assassinations, military detention without trial, collaboration with unsavory regimes, and more.
Meanwhile, outside our borders, a world of wounds has festered without much help, and often with harm, from the United States. We are neglecting so many problems—from world poverty, underdevelopment, and climate change to emerging shortages of food and water and energy, biological impoverishment, and transnational organized crime.
The following are among the many treaties ratified by all nations, except for a few rogue states—and the United States: the Convention of the Rights of the Child, the Convention Against All Forms of Discrimination Against Women, the Land Mine Convention, the International Criminal Court convention, the Biodiversity Convention, the Law of the Sea, the Kyoto Protocol of the Climate Convention, and the Convention on Persistent Organic Pollutants. The U.S. is the main reason we do not now have a World Environment Organization.
In these respects and in many others, the U.S. posture in the world reflects a radical imbalance: a hugely disproportionate focus on the military and on economic issues and a tragic neglect of some of the most serious challenges we and the world now confront.
These many challenges require farsighted, strong, and effective government leadership and action. Inevitably, then, the path to responding to these challenges leads to the political arena, where a vital, muscular democracy steered by an informed and engaged citizenry is needed. That’s the democracy we need, but, unfortunately, it is not the democracy we have. Right now, Washington isn’t even trying to seriously address most of these challenges. Neglect, stalemate, and denial rule the day. It is estimated that American politics is more polarized today than at any time since Reconstruction. Polarization, of course, is father to gridlock. Gridlock and stalemate are the last thing our country needs now.
The American political system is in deep trouble for another reason—it is moving from democracy to plutocracy and corporatocracy, supported by the ascendancy of market fundamentalism and a strident antiregulation, antigovernment, antitax ideology. The hard truth is that our political system today is simply incapable of meeting the great challenges described here. What we have is third-rate governance at a time when the challenges we face require first-rate governance.
America thus confronts a daunting array of challenges in the maintenance of our people’s well-being, in the conduct of our international affairs, in the management of our planet’s natural assets, and in the workings of our politics. Taken together, these challenges place in grave peril much that we hold dear.
The America we must seek for our children and grandchildren is not the America we have today. If we are going to change things for the better, we must first understand the forces that led us to this sea of troubles. When big problems emerge across the entire spectrum of national life, it cannot be due to small reasons. We have encompassing problems because of fundamental flaws in our economic and political system. By understanding these flaws, we can end them and move forward in a very different direction.
I think America got off course for two primary reasons. In recent decades we failed to build consistently on the foundations laid by the New Deal, by Franklin Roosevelt’s Four Freedoms and his Second Bill of Rights, and Eleanor Roosevelt’s Universal Declaration of Human Rights. Instead, we unleashed a virulent, fast-growing strain of corporate-consumerist capitalism. “Ours is the Ruthless Economy,” say Paul Samuelson and William Nordhaus in their influential textbook, Macroeconomics. And indeed it is. In its ruthlessness at home and abroad, it creates a world of wounds. As it strengthens and grows, those wounds deepen and multiply.
Such an economy begs for restraint and guidance in the public interest—control that can only be provided by government. Yet, at this point, the captains of our economic life and those who have benefited disproportionately from it have largely taken over our political life. Corporations, long identified as our principal economic actors, are now also our principal political actors. The result is a combined economic and political system—the operating system upon which our society runs—of great power and voraciousness, pursuing its own economic interests without serious concern for the values of fairness, justice, or sustainability that democratic government might have provided.
Our political economy has evolved and gathered force in parallel with the course of the Cold War and the growth of the American Security State. The Cold War and the rise of the American Empire have powerfully affected the nature of the political-economic system—strengthening the already existing prioritization of economic growth, giving rise to the military-industrial complex, and draining time, attention, and money away from domestic needs and emerging international challenges. This diversion of attention and resources continues with our response to international terrorism.
So what are this operating system’s key features, which have been given such free rein by these developments? First, ours is an economy that prioritizes economic growth above all else. We think of growth as an unalloyed good, but this growth fetish is a big source of our problems. We’ve had plenty of growth in recent decades—growth while wages stagnated, jobs fled our borders, life satisfaction flat-lined, social capital eroded, poverty and inequality mounted, and the environment declined. Today, U.S. GDP has regained its prerecession level, but 15 percent of American workers still can’t find full-time jobs.
Another key feature of today’s dysfunctional operating system is how powerfully the profit motive affects corporate behavior. Today’s corporations have been called “externalizing machines,” so committed are they to keeping the real costs of their activities off their books. Profit can be increased by keeping wages low and real social, environmental, and economic costs externalized—borne by society at large and not by the firm. One can get some measure of these external costs from a recent analysis of three thousand of the world’s biggest companies. It concluded that paying for their external environmental costs would erase at least a third of their profits. Profits can also be increased through subsidies, tax breaks, regulatory loopholes, and other gifts from government. Together, these external costs and subsidies lead to dishonest prices, which in turn lead consumers to spur on businesses that do serious damage to people and planet.
Given such emphasis on inexorable growth and profit, the constant spread of the market into new areas can be very costly environmentally and socially. As Karl Polanyi described in his 1944 book, The Great Transformation, “To allow the market mechanism to be sole director of the fate of human beings and their natural environment . . . would result in the demolition of society. . . . Nature would be reduced to its elements, neighborhoods and landscapes defiled, rivers polluted, military safety jeopardized, the power to produce food and raw materials destroyed.” With its emphasis on privatization, commercialization, and commodification, American capitalism has carried this demolition forward with a vengeance.
But the system that drives the capitalism we have today includes other elements.
by James Gustave Speth, Orion | Read more:
Image: Gary Waters
