CNN | short of civilization-ending revolution, solving the debt crisis might actually mean saving the 1%.
They have the power and the money, they own our government, and they won't go down without taking everyone and everything else with them. Instead of backing them even further into the corner of fear and defensiveness, we need to help them find a way out. And that means helping them understand how they got there.
The debt crisis is not entirely President Bush's or President Obama's fault. It's not even Congress' fault. It actually resulted from a short-term "fix" to the economy made about 700 years ago.
See, for pretty much the entire first millennium -- what we call the Middle Ages -- the 00.01%, the feudal lords, enjoyed total control over the land and its people. The 99.99% worked the land and served the lords, who created no value at all. But by around 1100, the Crusades moved a whole lot of people and stuff around Europe. Peasants were exposed to sugar, cotton and all sorts of new weaving and milling technologies for the first time. Former peasant farmers started to get smarter and more productive. They established market days and traded what they grew and made with one another. They invented local currencies to store and exchange value instead of bartering.
Local currency then worked very differently from the money we use today. Someone would simply bring grain they harvested to the grain store, and come out with a foil receipt. The receipt could be broken into smaller pieces, which served as money. Since some grain was lost to spoilage, the currency's value went down over time. This meant it had to be spent instead of saved. So the money circulated very rapidly.
People got wealthy, invested in upkeep on their windmills, paid one another good wages, and got taller. Little towns got so rich that they built cathedrals. That's how a peer-to-peer economy works.
Watch: "Pawning" for rich people
But the aristocrats weren't participating in any of this wealth. Without a dependent peasant class, they had no way to survive. They didn't know how to do anything themselves. They needed a way to make money simply by having money. So they came up with some ways to force new kinds of dependence.
Their first trick was to outlaw local currency. If people wanted to trade among themselves, they would have to borrow money from the central treasury, with interest. Wars were fought, blood was spilled, but they got their way. We have all but forgotten that the money we use today is a monopoly currency that costs us more than it's worth.
The second great idea was the chartered monopoly: the corporation. It gave just one firm -- one friend of the king -- the authority to do business in a certain industry. The British East India Trading Company, for example, had all rights to cotton in America. A farmer wasn't permitted to sell his cotton to neighbors, or to make it into anything. He had to sell it at fixed prices to the company, which shipped it to England and let some other chartered corporation make mittens and hats, which were then shipped back to America for sale.
That's why we fought the Revolution.
The problem with this scheme is that it works by stifling innovation and competition. The wealthy stay wealthy by extracting value instead of creating it. The more value they extract, the more laws they write protecting the rights and privileges of the extractors. As companies like General Electric realized, it was better to sell off productive assets and become more like a bank. The system was created for people who have money to make money. The value creators are the chumps.
They have the power and the money, they own our government, and they won't go down without taking everyone and everything else with them. Instead of backing them even further into the corner of fear and defensiveness, we need to help them find a way out. And that means helping them understand how they got there.
The debt crisis is not entirely President Bush's or President Obama's fault. It's not even Congress' fault. It actually resulted from a short-term "fix" to the economy made about 700 years ago.
See, for pretty much the entire first millennium -- what we call the Middle Ages -- the 00.01%, the feudal lords, enjoyed total control over the land and its people. The 99.99% worked the land and served the lords, who created no value at all. But by around 1100, the Crusades moved a whole lot of people and stuff around Europe. Peasants were exposed to sugar, cotton and all sorts of new weaving and milling technologies for the first time. Former peasant farmers started to get smarter and more productive. They established market days and traded what they grew and made with one another. They invented local currencies to store and exchange value instead of bartering.
Local currency then worked very differently from the money we use today. Someone would simply bring grain they harvested to the grain store, and come out with a foil receipt. The receipt could be broken into smaller pieces, which served as money. Since some grain was lost to spoilage, the currency's value went down over time. This meant it had to be spent instead of saved. So the money circulated very rapidly.
People got wealthy, invested in upkeep on their windmills, paid one another good wages, and got taller. Little towns got so rich that they built cathedrals. That's how a peer-to-peer economy works.
Watch: "Pawning" for rich people
But the aristocrats weren't participating in any of this wealth. Without a dependent peasant class, they had no way to survive. They didn't know how to do anything themselves. They needed a way to make money simply by having money. So they came up with some ways to force new kinds of dependence.
Their first trick was to outlaw local currency. If people wanted to trade among themselves, they would have to borrow money from the central treasury, with interest. Wars were fought, blood was spilled, but they got their way. We have all but forgotten that the money we use today is a monopoly currency that costs us more than it's worth.
The second great idea was the chartered monopoly: the corporation. It gave just one firm -- one friend of the king -- the authority to do business in a certain industry. The British East India Trading Company, for example, had all rights to cotton in America. A farmer wasn't permitted to sell his cotton to neighbors, or to make it into anything. He had to sell it at fixed prices to the company, which shipped it to England and let some other chartered corporation make mittens and hats, which were then shipped back to America for sale.
That's why we fought the Revolution.
The problem with this scheme is that it works by stifling innovation and competition. The wealthy stay wealthy by extracting value instead of creating it. The more value they extract, the more laws they write protecting the rights and privileges of the extractors. As companies like General Electric realized, it was better to sell off productive assets and become more like a bank. The system was created for people who have money to make money. The value creators are the chumps.
21 comments:
Last year, President Obama signed a Patent Reform Act that changed to first filed instead of first invented, giving more power to bogus patent mills like IBM instead of the smaller innovator. This makes it harder to keep innovators here in America.
We still have a sizable population in America that want to vote against their best interest. The corporation extract value only because consumers allow their value to be extracted with no re-investment. It's hard to say the banks and corporations are stealing when this is the case. I strongly believe most of America still holding onto that belief of "privilege" and still playing along.
Who would have a bank account with Wells Fargo in 2012? That's the problem....
Corporations function as unitary, rational actors - whereas - consumers act like divided and conquered sheep. Given the license granted to corporations to participate in the political process under Citizens United vs. FEC http://en.wikipedia.org/wiki/Citizens_United_v._Federal_Election_Commission?utm_source=Info-Jao+Turismo+Eng&utm_campaign=52602d747d-RSS_EMAIL_CAMPAIGN&utm_medium=email the capacity of divided and conquered sheep to resist unitary and highly focused corporations is at a low not witnessed since the rise of the 3rd Reich.
It's going to be hard for the ordinary citizens to become anything above something to extract value out of. How can they innovate with the new Patent Reform Act?
Right now, corporations are busy extracting value out of Peruvians because Americans are pretty much marginalized and little to extract from. The people in this country really need a better plan than memes to get something done...
are you suggesting that the corporation was substituted as a more general-use and not necessarily racialized substitute for the plantation?
In fact, I remember reading that some early industrialist said something to the effect that with corporations they don't even have to feed and house the workers.
and don't forget about the old company towns, a practice that had to be stopped due to the amazingly close analogies to plantations.
Seems like it would be instructive to organize a timeline showing the rise and fall of company towns along with a census of ownership and control and any accompanying narrative accounts of why the company towns were done away with.
The plantation is explicitly anti-democratic with the 3/5ths rule for representation but no voting rights for the slaves whose census drove the representation. Were voting rights denied the residents of company towns?
lol, simmer down BD, grown folks busy talking around here this morning.
there is at least one useful contribution you could make to the discourse, in your role as white privilege poster-child, would you please honestly answer the question of what extent you explicitly view the corporation as a reservoir and preserve of the white privilege you've enjoyed for the better part of your adult life?
Seriously, not having contributed anything to the real and productive economy, and having been allowed to participate fully as a food-powered make-work analyst (warsocialist engineer) - has Boeing lived up to its value proposition to you as a former worker in safeguarding privileges to which you pretend you're somehow genetically entitled?
Dale:
Do you remember all of those TV shows in the 80's that featured company towns? Shows like "B.J. and the Bear," "Knight Rider," and several others were often set in suburban/rural spaces in the South and West where the villains were invariably either defense contractors or big agri-business firms that had the entire town or county on lock-down. They were often forcing people off of land or some other heinous activity.
Is Littleton, Colorado a company town?
So you think the practice actually hasn't stopped?
I have no idea. What prompts you to single out Littleton? http://en.wikipedia.org/wiki/Littleton,_Colorado
If Arnach is around, he might be able to answer this question.
Boeing is in Littleton.
Or were those simply White Privilege "ghost stories"?
nah..., http://www.sourcewatch.org/index.php?title=Locations_of_Boeing,_Lockheed_Martin,_Raytheon,_and_TRW#Colorado
but with all the activity concentrated in and around colorado springs (cheyenne mountain and the air force academy) it would make sense for there to be a large military industrial encampment in tow...,
I remember reading back in the oil and coal mining days these corporations would print their own money to be circulated through the towns to pay the workers and spend in the local town community. They basically took over the town and control all aspects of life in those towns.
SMH - Why do you continue to entertain Barney Fife when he imagines himself to be John Galt?
LOL - I entertain barney fife BECAUSE he imagines himself to be John Galt.
He's almost a caricature of Dunning-Kruger... his incompetence completely obscures his inability to perceive it. The incompetence even extends to his inability to process feedback and eliminate it.
SMH - Why y'all gotta be so unrelentingly hard on my boy? What he ever do to you?
Because I want him to break out, to become aware. He shows glimmers of ability so I continue to have hope.
The incorporation legal framework and process is available to all. Anyone with the requisite cognitive skills, self discipline , and future time orientation can partake of the limitless socio-economic pie. Google was a blank sheet of paper 15 years ago. And without corporations, CNu, you'd be schleppin yer kids off to the Ivy League in an OxCart...
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