Why Moscow Mitch needs MMT

By J.D. ALT

Mitch McConnell is desperate to find investment funds and businesses that will create jobs for his Kentucky constituents. America, it seems, is mostly incapable of being a source for either. Such is the diminishment of our impoverished private enterprise system that only foreign companies seem interested in bringing U.S. dollars to America to build the factories that will employ us.

America, for example, has not built an aluminum rolling mill in over forty years. It must be easier (read “more profitable”) just to import the stuff. If you want to create jobs, though, in exchange for votes from your constituents, “profitability” takes on new dimensions. And while those additional dimensions don’t seem to appeal much to American enterprise, for some inexplicable reason they are appealing to foreign “investors”—especially ones from Russia. Russia, it seems, has discovered a new form of American “politico-capitalism.”

Basically, I’m guessing it works like this: A Russian Oligarch—here we must digress to be sure it’s understood that a “Russian Oligarch” is a managing agent in the government-mafia amalgamation that comprises the Russian economy— the Oligarch, indirectly, through back-channels, expresses interest in investing in the building of a large manufacturing enterprise in the home state of a U.S. senator. The senator, of course, is keen on the idea because it enables him to claim authorship of a deal that brings thousands of jobs to his struggling constituents (and would-be voters).

Other strings are pulled to provide a building site, local property tax breaks, and reduced development fees for the project. The Oligarch, as promised, comes up with the U.S. dollars necessary to build the project—transferred from an obscure network of international bank accounts holding dollars gleaned from the sale of Russian oil, gas, and military weaponry. High-profile ground-breaking ceremonies are held using golden shovels. The manufacturing facility gets built, commences operations, and hires thousands of the senator’s constituents. And though the business name contains no hint of it, the Russian Oligarch—hidden in layers of holding companies—is a majority stockholder of the enterprise.

Bumps, of course, can occur along the road. It’s possible, for example, that the Russian Oligarch may have been sanctioned by the U.S. government for engaging in economic activities against the interests of the United States—or that are considered illegal under U.S. or international law. The sanctions might be such that they bar U.S. businesses or citizens from doing business with the Oligarch. If that should happen, the U.S. senator has a dilemma: either enforce the sanctions and give up his juicy deal to provide thousands of jobs for his constituents—or maneuver in the U.S. senate to have the sanctions against the Oligarch repealed. If you happen to be not just any senator, but the U.S. senate majority leader, the second option seems relatively easy to pull off.

There are dangers in doing this, however. It’s possible that some nosey news organization might delve into the connection between the senator’s sanction-lifting maneuvers and the promised investment in the home-state aluminum rolling-mill. They might even go so far as to suggest that now the senator’s state, and thousands of his constituents, are beholden to the Russian government-mafia for their jobs and economic prosperity—and the senator, himself, is beholden to the Russian government-mafia for some portion of his re-election votes.

It’s easy to see the cost-benefit analysis of this business model from the perspective of the Russian government-mafia. They only need a few dozen such deals, strategically targeted, and suddenly they have become franchised “voters” in America’s democracy. Which is a position worth having if your long-term goals are to do lots of things the U.S. government would, otherwise, be strongly opposed to.

One could ask, however: Why is it necessary for a U.S. senator to take these risks? Why does he find it necessary, in order to promote new employment in his home state, to sell some part of his political power in America’s democracy to an agent of the Russian government-mafia? We must assume the senator is a patriot—his calculation is that he is creating much needed employment for his home-state constituents. He is truly not trying to sell-out America—so what is the desperation that forces him to risk doing exactly that?

The desperation, I propose, lies in the fact that it seems virtually impossible to find or create employment for his constituents. American enterprise just doesn’t seem interested. The only real interest U.S. profit-making strategists seem to have in his home-state is in selling his constituents opioid drugs to assuage their unemployed despondency and hopelessness. Russia seems to be the only alternative.

What the senator can’t seem to fathom is that neither he, nor his state, nor his constituents need the Russian government-mafia at all. There exists a completely American solution to his dilemma. The senator will not be happy that the solution (at present) is being promoted by the political party of which he is not a member—but, given his sincere interests in the well-being of his constituents, that shouldn’t be an insurmountable obstacle. What he wants are jobs for his desperate home-state neighbors, right?

To accomplish that goal, all the senator needs to do is undertake some senate maneuverings in a different direction: in support of a federal program that guarantees a living-wage job for every U.S. citizen who wants to work. This could be augmented by a universal basic income for every citizen as well—just enough to ensure that no one needs slip into desperation. With these two programs in place, the senator’s currently unemployed constituents would have the freedom to manage their lives in a direction of hope. Much of the job-guarantee’s new employees could be engaged in providing services to their own local communities, or undertaking the climate-change mitigation and adaptation efforts that private enterprise finds so unprofitable. Streams and rivers—infilled and poisoned by extraction industries—could be restored. Wildlife habitats could be reconstructed. One-on-one learn to read programs could be initiated for every second grader. The list of useful things to undertake goes on and on.

One of the most important benefits, however, of this alternative strategy to employ the senator’s constituents would be this: the thug-like mentality and machinations of Russia’s mafia-government would be kept out of America’s democracy. Moscow Mitch needs to understand there’s no place, and no NEED for it, here.

6 responses to “Why Moscow Mitch needs MMT

  1. Fully agree with everything in this piece except the constant references to Russia’s oligarchic, thug-like government (which do not appear to be tongue-in-cheek), without acknowledging that the Russian government is currently no worse in these respects than ours has become.

  2. Actually the difference is the Russians are overtly oppressive while we have a veneer of suaveness which in many ways is more insidious and mentally dangerous.

  3. J.d. alt does’nt like dem russkies.me thinks he might be applying for employment as an american ” liberal progressive journalist”.quit giving mmt that creepy atlantic council vibe.

  4. Creigh Gordon

    This project has Foxconn 2.0 written all over it, except that it involves the Senate Majority Leader instead of the Speaker of the House.

  5. I am familiar with this personally and you have unfairly accused good people. The Kentucky mill is in a desperately poor area of Kentucky and the project has been publicly seeking financing for a long while before the Russian expressed interest. The Russian company got off the sanctions list by completely changing their ownership structure and Board members to make the Russian Oligarch a minority owner with a minority number of board seats. The Russian company (with new CEO leading them) wants to truly be a global aluminum company and the Mill in Kentucky helps them to bring the raw aluminum from Russia (as the USA doesn’t produce enough raw aluminum for its own needs…so it has to come from outside the USA. These decisions were not quid-pro-quo and the inference they are could result in the mill not being built and hundreds of Kentuckians remaining without value added jobs. I get its fun to demonize everyone but in this case its inaccurate and wrong. Wrong to the Russian company, Wrong to Senator McConnell and wrong to the many other US senators and representatives who saw this as an opportunity to get a win for Kentucky and a win for transparent, free market capitalism.

  6. To 1ray1: Your comment is honest and reasonable, and I take your criticism seriously. Nobody wants to see the people of Kentucky lose jobs—or the opportunities for them. But you also reinforce the point of the essay, do you not? Why wasn’t Mitch McConnell able to get American enterprise interested in financing this project? The only possible answer I can imagine is because it was not viewed as profitable by American enterprise. To create the jobs, then, some other formula is necessary. In very simplistic terms, there are two options: 1. A U.S. federal government investment in creating the needed jobs (e.g. a “job guarantee program”—or a straight-out investment in the aluminum mill), or 2. Investment from a foreign country (e.g. Russia) which clearly has political as well as financial motivations. The essay was intended to point out the potentially damaging strings that can be attached to the second choice—and (more importantly) why it is not a choice that’s necessary to make. Claiming that America’s government is hopelessly in debt and unable to make significant investments in creating employment for American communities—or that it should not do that for ideological reasons—makes us vulnerable to foreign “political capitalism”. In Mitch McConnell’s case, I think he is guilty of both claims.