By Michael Hoexter
Corporatocracy/Plutocracy: The Neoliberal Compromise with Reality
While there are a certain number of “true believers” in the neoliberal ideal that tend to congregate around the banner of libertarianism or related concepts, a vast swath of the political class and ruling elite has been pulled to the right by neoliberalism without openly embracing its hidden utopia. These political and economic “realists” or “pragmatists” tend to see the true believers in neoliberal ideology as either an ideological “fig-leaf” that can provide a more appealing cover for the agenda of existing large private interests or, occasionally, as a fanatical embarrassment if they show too strong a belief in libertarian ideals. The notion of defunding public services and reducing public regulation of the private sector has a powerful appeal to many corporate and wealthy interests. So powerful is this appeal in fact that the label and concept of “libertarianism,” which is now adopted by the most other-worldly, some would say “idealistic”, individuals in the neoliberal spectrum, was coined by a US business lobbyist in the late 1940’s.
The potentially “messy” idealistic part of what now is called “libertarianism”, tends then in practice to be sidelined or filtered out of actual neoliberal politics and policy. Monopolies and oligopolies are not confronted or broken up. Government support and favorable treatment for large corporations are not cut but are often increased or rebranded and enhanced. The neoliberal ideal is realized only insofar as the interests of the more vulnerable and less wealthy are shunted aside within the policies of government while the interests of the powerful and wealthy are promoted under the cover of the neoliberal ideal of a “streamlined” and “fiscally responsible” government. Tax burdens are cut for the wealthiest while the tax burdens of the middle and lower classes are increased.
With fewer regulatory checks in the way and with the countervailing power of labor diminished, the power of organized money increases within government under the cover of the “free market” ideal. What results has been labeled using various terms but the words “corporatocracy” and “plutocracy” together describe the result: a government bought and ruled informally and in some cases formally by wealthy individuals and large corporations. It can be viewed as a particular form of oligarchy, an oligarchy with relatively fluid membership for the class of oligarchs that nevertheless hold the same sway over government and the national economy that families of latifundistas held in Central America during the late 19th and early 20th Centuries. In some instances, as with the privatization of publicly financed schools, military functions, prisons and infrastructure, the government also rules through corporations. The label “corporatism” is sometimes used to describe “corporatocracy” but the former word has origins in political science that do not describe the current rule by large corporations and plutocracy.
Using the word corporatocracy (or “corporatism”) alone also does not fully capture the role of the very wealthy who act primarily for their own private interests and not necessarily in concert with those of large corporations in shaping the agenda of policymakers. The word “oligarchy” or “incipient oligarchy” are appropriate but not as precise. The susceptibility of political leaders to the whims of wealthy individuals and worshipful respect accorded to the wealthy currently is better described by the notion of a “plutocracy”, the rule of money and the wealthy. So, inconvenient as it is from the point of view of political sloganeering, to speak of a “corporatocracy-plutocracy” or an “emerging corporate-plutocratic oligarchy” is more precise. To use less accurate or partial terms, though occasionally acceptable in my opinion, communicates to the listener a vague sense of “a bad system/thing that the speaker/writer doesn’t like”.
The Neoliberal Preference for Government’s Coercive Apparatus
While within neoliberalism there are conflicts, the broad coalition of right-wing forces that have pushed the neoliberal agenda have generally supported implicitly or explicitly the build out of a massive national security state, despite paradoxically, in some sub-tendencies, basing their world view on a supposed opposition to government “coercion” in any form. Inheriting an already substantial military and security apparatus from the military Keynesian WWII-Cold War era, the early neoliberalism-influenced leaders (Pinochet, Reagan, Thatcher) all strongly supported reinforcement and use of military force to achieve political and economic ends that favored economic elites.
While via claiming early opposition to the second Iraq War, Obama tried to distinguish himself during his Presidential campaign from his Republican neoliberal predecessor, Bush Jr., Obama has continued the trend of reinforcing the national security state particularly as regards clandestine acts, disregard for human rights and civil liberties, and surveillance of the domestic population. Even though neoliberal leaders have varied in their aggressiveness in using coercive force, the close relationship with authoritarianism within neoliberalism is ironic but very clearly present in all historical implementations of neoliberal policy and politics. In the reality of neoliberalism, the call to a maximal unfettered “liberty” as an ideal is paired with a kowtowing to authority if it is dressed in a uniform, speaks in harsh tones, and directs its destructive power against those without property or who are marginal to a particular cultural or national community.
The seemingly universalizing philosophy of neoliberalism which bases its intellectual appeal and moral authority on the notion that it is about defending liberty, particularly liberty of the individual, then encounters a substantial inconsistency when confronted with the actions of neoliberals once they achieve political power. The central raison d’etre of neoliberalism, defense of liberty, then appears to be more of a “belief of convenience” for most neoliberals, as the attractions of using political and military power to further their own personal agendas or the economic agendas of political patrons becomes paramount. Even libertarians, who decry “coercion” by government, spend an inordinate amount of their energy criticizing taxation while often ignoring or minimizing the use and abuse of military force as well as infringements of human rights and civil liberties at home and abroad. The primary liberty which concerns both them and more mainstream neoliberals is the freedom to own and exercise private property rights in as expansive a manner as possible. It can be reasonably asserted that most libertarians are “propertarians”, focused primarily on real and imagined threats to the private ownership of property. “Freedom” becomes an ideological excuse for personal acquisitiveness and greed.
The Neoliberal Veil over Acquisitiveness
The “mystery” of the neoliberal preference for the coercive and surveillance apparatus of government then becomes even less mysterious when we understand that in “pragmatic” terms, neoliberal ideals function in practice as an entering wedge for corporate and plutocratic control of government. As social, political and economic inequality rise, the defense of large private holdings becomes more and more dependent on coercive tactics to ward off even the very distant possibility of political attempts to control, rein in and/or redistribute the accumulated holdings of the wealthy and the corporate sector. As the “rules of the game” are rigged further and further to the benefit of the already wealthy, the non-wealthy have either the path of political protest and political redistribution of resources or the much less desirable path of criminality open to them.
Therefore, in practice, despite the philosophical distractions offered by professions of interest in liberty, neoliberalism functions as ideological justification for exertion of political, police, and military power in favor of the interests of large property holders, and in the wealthiest countries, financial and corporate interests. Occasionally there are libertarians of the Right who call attention more consistently to abuses of civil liberties but given conflicts between the private property rights of the wealthy or well-to-do and the non-wealthy, neoliberals and most libertarians will side with policies that favor the already comfortable and powerful. Neoliberalism then in practice shades into a historical series of “laissez faire” political-economic philosophies that have acted largely as ideological cover for a capitalist ruling elite that sought via free trade and free market ideologies to open the world to maximal exploitation by a, for the most part Euro-American, but now a somewhat more “multi-cultural” and international ruling elite focused on advancing their own interests as property holders.
Clinton, Blair, Obama: The False Neoliberal “Left”
Neoliberalism has seen some of its greatest triumphs in spreading its ideology throughout society by temporarily peeling away the traditional reactionary-Right envelope from which its original leaders emerged. The early neoliberal leaders, Reagan, Pinochet, and Thatcher had some or all of the marks of the traditional authoritarian Right in their style of speech and the cultural preferences they expressed and represented. Entirely different in appearance and mannerisms were the leaders of the more leftward parties that accommodated themselves to or adopted wholesale the neoliberal political-economic ideological framework. Bill Clinton and Tony Blair in the 1990’s provided a younger “cooler” image, the image of the Baby Boom generation, while at the same time supporting a greater “marketization” of the economy and holding out the private financial and corporate economy as the model for all social organization. Clinton, but also Blair to some degree, was known for his ability to “feel your pain”, to express a theatrical-seeming empathy for others that did not question the fundamentals of the neoliberal vision of society.
Despite Clinton’s susceptibility to the Right’s economic vision, the Right conducted a vicious personalized campaign of attacks against Clinton and his Administration. In some sense, the Right fell back on its cultural/social conservative hatred of the 1960’s, a decade which had superficially shaped Clinton’s cultural preferences though few of his policies. These attacks and their viciousness distracted the press and the public from the similarities in Clinton’s approach to policy with those of his Republic predecessors. The cultural attacks on the false neoliberal “Left” turned out to have valuable functions for powerful political-economic interests like the FIRE sector (finance, insurance and real estate). Under the guise of being an embattled group, ( Q.E.D. “he must be Left if he is being attacked by the Right”), the supposed neoliberal left’s affinity for the mushrooming financial oligarchy could be hidden away as an assumed characteristic of what was “progressive”, broadly defined. Clinton, under the influence of Wall Street, became mesmerized by the financial sector and its seeming sophistication, repealing the Glass-Steagall Act that had held the financial sector in check for 60 years, which has set the stage for the Global Financial Crisis of 2007-2008. It was in this era that the financialized monstrosity of cap and trade was institutionalized as the central policy instrument in the fight against climate change, what is and will be humanity’s greatest challenge to date. The sham “Left” became a convenient political “alter ego” for the ballooning financial sector, traditionally associated with the Right, to enhance its growing political-economic power.
Importantly, the personal animosities and different cultural markings of the two neoliberal groups have created a sham political discourse which the media has fostered where “Right” and “Left” are characterized by superficial cultural signifiers and the content of their disagreements often devolves to minute differences on issues that reflect and exacerbate cultural divides but not central political-economic dynamics. The cultural conflict between the two “wings” of neoliberalism is reported as a meaningful difference in fundamental opinion; this obscures the advancing influence and control of the plutocratic and corporate elite over government and over the economy more generally.
If one of the functions of neoliberalism for financial and economic elites is to create an ideological veil over the acquisitiveness of the wealthy, banks, and corporations, the importance of the neoliberal “Left” becomes clearer, as the Left has traditionally advocated for the less wealthy and the downtrodden. If formerly left-of-center political groupings also adopt a neoliberal policy orientation and manner of speaking, which has been the case on both sides of the Atlantic over the past two decades, then the veiling function of neoliberalism is in many ways “perfected”: “Left” neoliberals can “decorate” greed and acquisitiveness in the raiments of empathy, moral purpose and high-flown rhetoric. Furthermore, as mentioned above, the political conflicts between two brands of neoliberalism distract from their fundamental agreement about basic political economic issues, further increasing the opacity of the veil over the acquisitiveness of the ruling groups.
Obama To Date, the Apotheosis of Neoliberalism
The current US President, Obama, has functioned almost perfectly as an ersatz “Left” for media and political consumption, despite his for the most part right-of-center neoliberal policy initiatives and political philosophy. During his tenure the sham conflict between Right and pseudo-Left has reached a fever pitch that obscures the advancing development and entrenchment of the plutocratic-corporatocratic class as the de facto rulers of the United States. The neoliberal Right in America has become so ideologically extreme that Obama’s timid forays into corporate-friendly reform are treated as if they represent the cutting edge of progressivism by a media focused largely on politics as a series of culture and personality clashes or a “horse-race”.
Obama’s calm demeanor, attractive, normal-seeming family, African heritage and exotic individual biography have functioned as a screen onto which supporters and nominal opponents alike project either idealizations or wildly negative stereotypes with an alarming freedom. This has led Obama’s fairly aggressive neoliberal agenda to escape notice in most of the mainstream press, as the press reports largely upon efforts to either condemn or idealize Obama has a leader or a man and not upon the actual import of his proposals.
Obama’s solid support for corporate- and bank-friendly policy is hidden from the view of many behind his occasional soaring rhetoric and limp efforts at reform which to supporters, so far, have been treated as either progressive or a form of pragmatic progressivism that is the only “realistic” alternative. A reformer more than Bush his predecessor, Obama is fundamentally a rationalizer of neoliberalism, solidly evincing the belief in the notion that government must remain a handmaiden of corporate interests and beholden to the rich for its supply of money, either for campaigns or via the notion that government acquires its money by taxation. A generation of progressives that can remember only “identity politics” and neoliberal Presidencies of the Right and pseudo-Left have been to date adequately fooled or cowed by Obama’s relatively sympathetic personality and cultural identity as the first African-American President to criticize him as openly and roundly as is needed. The reticence to criticize Obama is as much an expression of racism as is the Right’s tendency to demonize him as a “Kenyan socialist”.
While Obama occasionally engages in flights of soaring rhetoric that with different content might mobilize the population around a popular agenda, the world evoked by Obama’s language is one of cautious individual self-improvement rather than increasing social solidarity and social action. With an emphasis on mild rational social change, “nudges” as conceptualized by his close advisor Cass Sunstein, the fundamental outlines of the neoliberal world of isolated families and individuals is continuously re-evoked, in tones that sometimes recall the cultural milieu of a Norman Rockwell painting.
“Left” Neoliberalism, Obama and the Perversion of Empathy
Obama, whether by his own intention or by that of others, acts fundamentally as a disorganizer of progressive constituencies as they either follow his lead into political ineffectuality and reinforcement of the neoliberal order or, if they criticize him openly, are marginalized as being of a piece with the hyperventilating, racist Right. He has effectively dissipated the energies of both his own idealistic supporters and progressive critics, both of which have had good intentions though often haven’t had an adequate analysis and voice to overcome the cloud of uncertainty that he casts over them and their impulse to create a better world.
A world in which empathy and therefore human solidarity is a guiding fundamental principle, what I am contending is a hallmark of a truly progressive vision, appears to be almost as alien to Obama as it is to his rabidly right-wing nominal opponents. Obama, like Clinton and Blair before him, leads people to “hope” for a better outcome and a better world only to mislead or stifle their impulses to do good. He may not be aware of his function as a “Bermuda Triangle” for social movements because he may accept as holy writ the fractured “there is no society” vision of neoliberalism. He may or may not recognize that he is, especially in a time of economic and political crisis, the de-facto leader of US society, but he speaks and pretends as if the impulse to do good can only have effect in very circumscribed arenas. Besides rhetorical flourishes, Obama acts as the voice of caution rather than action. His efforts in the area of reform have almost always taken the form of finding the mid-point between two Establishment “extremes”, with the supposed Left side, represented by moderates within the Democratic Party.
Fundamentally the movement to create a better world is based on human empathy and caring for each other and for future generations. “Left” neoliberal leaders like Clinton, Blair and now Obama attempt to consciously or unconsciously siphon off people’s empathic impulses to ends that are harmless to the neoliberal oligarchy, the dominance of the large financial institutions, multinational corporations, and very wealthy individuals. More than even Clinton before him, Obama is a master of temporarily capturing the impulse to do good and turning it to ends that fundamentally will not change the basis of the current corrupt social-economic order.
Connectivity: A Matter of Survival
As I am finishing the writing of this long piece, we have had as clear a demonstration as any of the decades long attack on the connective function of government works in the collapse of the fifty year old I-5 bridge over Washington’s Skagit river. This bridge and Interstate 5 tie the North America’s Pacific Coast more closely together. That, in an earlier era, government, a government led by the more conservative American political party, the Republicans, bound Americans closer together via the building of the Interstate system and related infrastructure is an achievement that seems alien in the neoliberal era. That the existing, outdated infrastructure of the US is now in dangerous disrepair is a tribute to the thirty year dominance of neoliberalism in American politics as well as the faulty, dominant ideas about government’s role and government finance that spring from it.
Neoliberalism is so near complete dominance in (European and) American politics yet so faulty as a ruling political-economic ideology that we may be near the point of it collapsing, yielding a struggle to create a new political-economic framework, preferably more egalitarian, reality-based, and future-looking. The replacement of neoliberalism with a better framework is a matter of life and death because of coming global challenges, in particular mitigating and adapting to climate change. An effective movement to transition to a post-carbon civilization will require greater social and political solidarity than we have previously experienced, a wartime type mobilization, decades long, the likes of which we have not yet seen. We need to together re-design society and civilization now with great haste so as to avoid the worst of a world that is much hotter and particularly damaging to the co-evolved species (think: food) upon which we depend. We will need to care about future generations as well as ourselves, a caring that should not be siphoned off and perverted by “Fix the Debt” and right-wing “philanthropists” like Pete Peterson by attaching those concerns to the relatively meaningless levels of public debt issued by governments that control their own currency.
We will require much of the “connective tissue” provided by government to move together towards this fundamental restructuring of the energy, transport and food systems, while dealing with critical shortages in fresh water and other resources. Building networks of zero carbon transport and energy generation will require coordination within and between nations. The neoliberal tendency to attenuate and “eat away” the connective functions of government will need to be reversed. People will have to care enough about themselves and about each other to act to save themselves. People will need to lend enough legitimacy to a new social contract to remake the economy so the physical earth can be habitable for future generations. While neoliberals have dismissed social cooperation other than that offered by markets as “inefficient” or “communistic”, we and they will require high levels of coordination in order to survive in a form that is humane and that doesn’t dispose of all that we have come to enjoy about modernity.
After toying with climate change as an issue a number of times during his Administration, Obama is now flirting with the issue once again, calling out the extreme Right in Congress on their denial of human-caused global warming. Obama could attempt to yoke the issue once again to his neoliberal vision of a government and society beholden to large private interests, while suggesting that it is an impossibility that we would have a government that steers independently of, for instance, the economic interests of the fossil fuel industry, as well as other incumbent industries. He is capable of perverting this issue as he has others or flirting with and exhausting well intentioned people. We will need to persist in viewing the world as it is, and resist the pull of leaders who attempt to hijack our better impulses for their own or their patrons’ purposes.
We will need in too short an order, to repair much of the damage that has been inflicted by neoliberal political actors upon our societies’ cohesiveness and ability to coordinate action. All this needs to happen before it is too late for a recognizable human civilization to thrive on this planet.
