Class Warfare Blog

April 5, 2021

Why Are the Rich So Hot For School Choice?

Everywhere in this land the rich, the 1%, are finagling for more charter schools, more vouchers, more support for private schools and less, ugh, public schools. Why?

I think the answer is multifaceted.

Back when I was a youngin’ it was an unvarnished truth that free public schooling was a pillar of our democracy. What would we have if citizens went uneducated? By this logic we accepted public schooling as a “collective responsibility,” not just an individual responsibility. But, also in my childhood, I heard from people arguing: “I don’t have any children, so why should I be paying school taxes?” This argument confused individual and collective responsibilities. We all benefit from the education of the citizenry, so we all pay for it (unless you are a church). Some of the rich expanded upon this argument and asked “I pay a great deal of money to have my children educated in the finest private schools, so why should I also have to pay for the public schools. Again, this argument confuses individual and collective responsibilities. I do not actually think they were confused on that issue, I think they were just making an argument, any argument, that might reduce their taxes. (It is interesting that those with the most money, worry about how much money they have more than others do.)

Some of the very richest consider all taxes to be “theft.” These extremists got their wish when a town out in the boondocks (of Montana? Idaho?) voted in a cadre of people who thought like that. They thought being a low tax zone would attract all kinds of businesses, but when they reduced or eliminated the vast majority of taxes, they lost their police department, their fire department, their road maintenance department, and even their city hall. (The town council, in fact the whole city government, now works out of a single wide trailer.) Businesses not only didn’t flock to their city they ran, screaming, the other way.

More recently, the filthy rich have recognized that they have cornered almost all of the sources of wealth in this country: mineral extraction, construction, communications, financial “instruments,” etc. and then turned their gaze upon the pile of money spent every year on public schools. This amount of money dwarfs the revenues of many of the other wealth sources in the US combined. So, there was money to be made in supplanted the “public schools.” They even figured out how to extract large profits from “non-profit charter schools.” It was ridiculously easy. First create a school. Then hire a “management company” to run it, a company which has no restrictions on making profits at all. Often the two entities were the same people. Have you ever wondered why there are so may charter school scandals? The answer is easy: the founder’s motivation was greed and with little to no oversight (aka guvmint regulayshun) greed overwhelmed any restraint every time.

It is somewhat amazing how it is that ordinarily intelligent business people can decide to create a business in a certain place because it has a “large pool of quality workers” and then turn around and undermine the process that produces those workers.

I think all this is based upon the rich man’s fallacy: namely that their wealth is a sign of their superiority. That they were able to become rich is their qualification. The “other people” are lesser beings, not worthy of their attention. This meme is so entrenched in the minds of the rich that they all consider themselves to be “self-made men.” I laughed at Mitt Romney making this claim. You see when Mitt graduated from college, his father gave him $2,000,000 of seed money and access to all of his contacts (his father was President of American Motors and a heavy hitter in the Republican party). Do you know how much money I made in my almost 40 years as a college professor (at about the same time span)? It was $2,000,000. Mitt Romney was given, in effect, the amount of my career earnings to “get started” in business. But Mitt Romney did it all himself. He even dialed his own phone from time to time, I am sure.

March 15, 2021

The Anti-American Big Corporations

When it became clear to corporate leaders that the rest of the manufacturing world was catching up, what was their response? If you believed their rhetoric, it would have been to double down on American workers. These leaders would have reached out to labor unions and partnered with them to devise ways to shove American productivity, then the highest in the world, even higher. This was necessary, it is said, because while other workforces were nowhere near as productive as ours (most were not even close), the low cost of the labor in many of those countries allowed for that lack of productivity and still allowed for very healthy profit margins.

So, the segment of our society we call “corporate leaders” saw the writing on the wall and did . . . what? They lifted up themselves on their own ideology (“My Country Right or Wrong” “This is the greatest country in the world!” “American exceptionalism is what guides commerce.” etc.), rolled up their sleeves . . . and moved their factories to countries with cheaper labor.

Not long after this “movement” swept the bulk of American manufacturing jobs overseas, it was shown that the lower productivities, the difficulty of managing factories from far away, and the increased transportation costs (for both raw materials and finished goods) ate up all or most of the so-called savings harvested by moving production facilities overseas.

So, why did they do it? Mostly, it was for purposes of tax avoidance. Tariffs were low, so not much had to be paid to import those “American Made” goods (yes, they still claimed they were American made because they were made in American owned factories). But by running their “earnings” through shell corporations in low tax countries they could reduce the taxes they paid substantially.

So, this country was still their country, right or wrong, but they didn’t want to pay for any of it in either case.

We tend to exalt these corporate tycoons, but based upon their behaviors, they should be seen as pariahs instead. The taxes they avoided have been picked up by others (the rest of us and in the form of national debt). They have used political power, through bribes, er campaign donations, to gut American labor laws even after hiring new labor forces in other countries. They hate unions, just hate them. It used to be that corporate power was opposed only by labor unions and the government (remember anti-trust actions?). They eliminated the labor unions by changing the laws protecting them and protecting workers. They eliminated the government opposition by bribery, er campaign donations, and co-opting regulators (who often go to nice jobs in the industries they regulated after they leave government).

We could eliminate tax havens with a stroke of a pen, by changing the tax laws that allow for them. That does not happen because the legislators have been bought off. We could disadvantage companies who move overseas, but we don’t (guess why).

All we have the power to actually do is to change their social standing. Instead of idolizing the Jeff Bezoses and Elon Musks of this country, we should call them out on their abuses of their workers and our tax laws. These are far from nice people, we shouldn’t give them elevated social status to further inflate their already inflated egos. We should, instead, elevate what they owe to the culture and country that made what they have done possible. We should demand a higher level of civil virtue the bigger they get (. . . from those according to their ability . . . , btw this is not just to be found in Marx, but also Christian scripture). Instead we expect them to only manifest the worst of us . . . greed. Corporations have been sold the bogus idea that they should direct their efforts only to maximizing shareholder value. (Gee, I wonder who promoted that bogus idea? Step One: Find an economist needing a bit of money. Step Two: have them promote your bogus idea. Step Three: Spread a bit more cash around in economic circles to get the idea discussed. Done.)

These are the same corporations that have been making money hand over fist during the pandemic and who supported a government approach to the problem that guaranteed that the pandemic would last longer than anyone thought. Never let a good catastrophe, er opportunity, go to waste.

We are reaping what we have allowed to be sown.

February 25, 2021

The China Hustle

If you needed more ammunition to support the belief that the stock markets need to be shut down, do watch the documentary “The China Hustle” on various streaming services.

What this hustle comes down to is some “investors” saw that China recovered from the 2008 Great Recession very quickly and investing in Chinese companies might be a way to offset losses from the stock market crash. The only problem was most Chinese companies were not traded on American stock markets. So, a workaround was devised. They arranged for small Chinese companies to be merged with now defunct U.S. companies that had one crucial characteristic: they were already approved for trading of “their” stock on the U.S. exchanges.

So as to not spoil the documentary, let it be pointed out that lying to foreigners is not a crime in China. The upshot is that hundreds of billions of dollars were extracted from “investors” which then flowed into China through fraudulent descriptions of these “companies.” And, apparently, none of the usual “checks and balances and regulations” apply.

And it is still going on, because those who are making money off of the process don’t want “the problem” to be solved.

The stock market has no real purpose other than to be a giant casino where people gamble their money. That there are “losers” in the game is acknowledged, but only the winners are celebrated and because the “house” skims its fees off of the top, there is no impetus to close the casino.

This is a well-made documentary and well worth watching. If you wonder whether our democracy is strong enough to withstand all forces, you need to think again. If we fall, it will because of greed being our most serious failing.

 

February 12, 2021

It is Time to Do Away with the Stock Markets

A couple of recent stories surrounding the stock market are indicative of why we need to do away with it.

#1 “Collapsed revenues, astronomical losses, red-hot cash-burn, hellish new debt. Meanwhile, amid craziest markets ever, airline shares soared.”

#2 A stock buyback – a company purchasing its own shares to reduce the number openly available and so push the price up – is a form of market manipulation that was illegal in the US until Ronald Reagan decided that to ban it was to restrict market freedom. As a result, many corporations, instead of building factories, now plough money into their own shares.

It has helped raise the stock market to record levels and provided shareholders with a huge bonus. But few others have benefited. The pharmaceutical company Merck insists that it must charge exorbitant amounts for its medicines to help fund new research. In 2018, the company spent $10 billion on research and development – and $14 billion on share repurchases and dividends. One report suggests that had Wal-Mart diverted half the money it has spent on stock buybacks into wages, one million of its lowest-paid employees, many of whom live below the poverty line, could have had a 50% pay increase.

#3 A bunch of Reddit geeks on the online forum r/wallstreetbets, an investment discussion group that boasts more than 6 million users, decided to buy GameStop shares en masse. Perhaps they saw it as an investment, perhaps they were bored, perhaps they wanted to inflict pain on Wall Street. Whatever the reason, the consequence was to push GameStop’s share price up. And up. Once it became a global story, others piled in too, boosting the share price from about $40 to almost $400 in a matter of days. As a result, big investors lost big (billions of dollars reportedly), one hedge fund, Melvin Capital Management, even being forced to seek a rescue package. (They, of course, were “shorting” that stock looking to make money by providing, well, nothing to earn it. So sad.)

The “stock market” as you were taught about in school barely exists. Some companies do “go public,” selling pieces of their company to raise the money to expand, modernize, whatever. But this activity constitutes less than 10% of the activity of the American stock markets. Most of the “market activity” is what are called the “secondary market” in which people buy and sell stocks already existing. This benefits the companies not at all and, as you can see from point #2 above, it is not unusual for a company to buy and sell its own stock to manipulate their stock’s price (which is what stock brokers are complaining about in point #3, that manipulation not being done by the right kind of people, don’t you know).

The entirety of the stock market has been studied and shown to be a drain on the economy, so why do we allow this abomination to exist? Basically wealthy people are siphoning off money from the economy by pushing paper in the stock markets, contributing nothing in return. But because they are wealthy, and contribute much money to the campaign coffers of politicians, there is no serious movement to “defund the stock markets” as it were.

The time has come: either get rid of it or place a transaction tax upon the traders. That would at least discourage rampant secondary market stock trading which has no value for the American people (actually it has negative value).

February 9, 2021

News Media Finally Stumbles Over the Truth

The Guardian ran an article today entitled “Amazon’s mushrooming power has met an unlikely foe: Bessemer, Alabama” by Hamilton Nolan. The author sets the stage with this:

Which brings us to the unlikely town of Bessemer, Alabama, where voting has just begun on the first real union election at an Amazon warehouse in the US. To be an Amazon warehouse worker today is to find yourself in the odd position of simultaneously having kind of a crappy job while also being perhaps the single most important kind of worker in America. That is to say, these workers represent the embodiment of where all of our corporate and economic trends are headed – low-wage jobs dictated by algorithms, in which people act as living automatons, completely at the mercy of the arcane needs of a trillion-dollar company. As small businesses across the country fail, more and more people every day wake up to find that these kinds of warehouse jobs are all that they can get. If our economy keeps evolving as it has been, any one of us could be forced to become an Amazon warehouse worker soon enough.”

But the real message came a bit later, namely:

Likewise, the labor movement in America has a rich history stretching back more than a century, but you can understand its key purpose like so: it exists to make working people as powerful in our economy as companies are. Without strong unions, the imbalance of power between employers and employees is so hopeless that it can produce a society where a tiny handful of super-rich people get ever richer, even while wages stagnate for everyone else and labor rights are constantly eroded, making the ‘American Dream’ of upward mobility a cruel joke. In other words – what we have now.

In other words – what we have now.

The diminishment of the American labor movement is often portrayed as something that just happened. They say things like “The union movement declined . . . blah, blah, blah.” This is a little like a description of a prize fight in which one of the fighters, overmatched, is viciously bludgeoned to the canvas by saying “The challenger fell during the seventh round and couldn’t get up, thus losing the match”

The American union movement was deliberately undermined by the same forces running the country right now. It began in the 1930’s but didn’t pick up steam until the New Deal created new supports for labor unions. The unions surged and the opposition started to organize big time. The Powell Memo of the late 1970’s was a blueprint for the suppression of government regulations and labor unions and the efforts behind it haven’t let up since then. (Hatred of the New Deal is still a hallmark of fat cat status.)

For those who claim this diminishment came about “naturally” please note that in the 1960’s both the U.S. and Canada had about 31% of all jobs being union jobs. Sixty years later, aka now, Canada has about 31% union jobs and the U.S. has somewhere south of 10% union jobs. If the diminishment of labor unions was “natural,” why didn’t it also happen in Canada?

The reason why unions were slated for destruction is clear. It was stated clearly in the article referred to above “Without strong unions, the imbalance of power between employers and employees is so hopeless that it can produce a society where a tiny handful of super-rich people get ever richer, even while wages stagnate for everyone else and labor rights are constantly eroded, making the ‘American Dream’ of upward mobility a cruel joke. In other words – what we have now.”

In politics if you want to know why something happens, you are taught to “follow the money.” Can you see who might benefit from “a society where a tiny handful of super-rich people get ever richer?”

Now you know who the puppetmasters/stringpullers are.

February 8, 2021

Whatever Happened to the Founders’ Virtue

The Founding Fathers of our government spoke often of virtue and by this they were not talking about personal or individual virtues, how individuals live a virtuous life to impact their own well-being; they were speaking about public virtue. It may be an oversimplification but in a political context public virtue is the subordination of individual benefits to benefit the whole of society. The Founders seemed to have believed that if public virtue were not preeminently demonstrated and encouraged, the grand American Experiment in Democracy would fail.

We also occasionally laud healthcare workers and charity workers, etc. but mostly there are no calls for people to sacrifice for the “greater good.”

Currently, in the U.S., the only public virtue that is acknowledged is military service. Young men and women forgo “earning a living” to serve, often in dangerous situations, the greater good of the U.S. interests. (Would that U.S. politicians acknowledge those contributions with less venal declarations of what our interests are.)

We also occasionally laud healthcare workers and charity workers, etc. but mostly there are no calls for people to sacrifice for the “greater good.”

This especially applies to the very wealthy in the U.S. who seem to think that their great wealth is a sign of them being better than us and have decided that their ideas are best to run this country and have since taken over our political system by the simple expedient of buying it. That they have since used that system to expand their wealth shows that their public virtue is almost non existent. (Often the very wealthy use philanthropy to make overt statements of public virtue, but their other activities belie those gestures.)

This is where capitalism and the economic intellectuals who laud “market economies” come into play. Economics is larded with “principles” based upon “every man for himself” (they call it “enlightened self-interest,” really). Market economies are claimed to work best when people act in only their own self interest. Where in economics is the public good and the greater good and sacrifices that constitute displays of public virtue come into play? Well, they do not. They do not because the wealthy masters of that field want personal greed established as being worthy. “Greed is good,” they say.

People not only do not vote on candidates and issues that are contrary to their own interests “for the greater good” but vote against their self interests to inflict punishment on those they deem as being less worthy. (Yes, I am painting with a broad brush and not “all” do this but very many do.)

Is public virtue dead, and with it the American Experiment in Democracy?

February 7, 2021

Capitalism is Civilization 2.0

Filed under: Culture,Economics,History,Politics — Steve Ruis @ 11:23 am
Tags: , , ,

Note This may be a bit repetitious but I keep reading about it and it keeps shocking me. Steve

If you have followed this blog for long, you have read my take on civilization, namely that I am not a fan of civilization per se (See my post “Not a Fan of Civilization?”). The history of the first civilizations is often portrayed as “humans discovered agriculture and grew so much food they could afford kings and priests and the like.” (These descriptions are starting to sound like whitewashed Bible stories generated to proselytize children.) Actually, in almost every case, agriculture—large scale agriculture—was driven by elites or elite wannabes. Agricultural work was far more strenuous than hunting and gathering and people didn’t flock to the fields begging to be agricultural workers. The archeological record shows that people got physically smaller (shorter, less heavy) and more disease ridden because of agriculture.

Since cajoling people rarely worked to get them to toil in the fields, force was employed, and a set of new elites was created, full-time guards/soldiers. (Imagine volunteer firefighters being offered full-time jobs, with benefits. Such would have been the case for those who would arm themselves to defend the village from predators and marauders.) These “guards” made sure the field workers didn’t run off and also participated in slave raids in nearby villages. Yes, civilization was built upon widespread slavery, much like the American South.

As I have mentioned before, when capitalism and industrialization came along, “workers” didn’t show up and get in cues to be hired. Most English “peasants” valued their freedom and didn’t bite on various offers to “get a job.”

So, capitalists did what they normally do, they used governmental power to force people into their factories. They used every dirty trick in the book to get people off of the land and onto factory floors: laws were passed, taxes were levied, etc. You know the routine.

These are the same people who, today, laud how self-regulating markets are, that markets can organize our economies to be “Yuge, really yuge.” Except then they don’t and the bayonets come out.

As I stated in that post mentioned above: “From foragers being forced off land they’ve lived on for centuries because they cannot produce deeds of ownership, to eighteenth-century Scottish Highlanders who preferred to tend their sheep, to today’s college graduates saddled with tens of thousands of dollars in debt before they’ve landed their first job, nonparticipation in the market economy has consistently and effectively been eliminated as a viable option. To those who suggest we should “Love it or leave it,” I’d suggest that neither option is—or has ever been—a realistic possibility. It’s as if people are being forced into casinos at gunpoint, where they lose everything, generation after generation, and then they’re told they’ve got a gambling problem.”

February 6, 2021

Capitalism is Civilization 2.0

If you have followed this blog for long, you have read my take on civilization, namely that I am not a fan of civilization per se (See my post “Not a Fan of Civilization?”). The history of the first civilizations is often portrayed as “humans discovered agriculture and grew so much food they could afford kings and priests and the like.” (These descriptions are starting to sound like whitewashed Bible stories generated to proselytize children.) Actually, in almost every case, agriculture—large scale agriculture—was driven by elites or elite wannabes. Agricultural work was far more strenuous than hunting and gathering and people didn’t flock to the fields begging to be agricultural workers. The archeological record shows that people got physically smaller (shorter, less heavy) and more disease ridden because of agriculture.

Since cajoling people didn’t always work to get them to toil in the fields, force was employed, and a set of new elites was created, full-time guards/soldiers. (Imagine volunteer firefighters being offered full-time jobs, with benefits. Such would have been the case for those few who would arm themselves to defend the village from predators and marauders.) These people made sure the field workers didn’t run off and also participated in slave raids in nearby villages. Yes, civilization was built upon widespread slavery, much like the American South.

As I have mentioned before, when capitalism and industrialization came along, “workers” didn’t show up and get in cues to be hired. Most English “peasants” valued their freedom and didn’t bite on various offers to “get a job.”

So, capitalists did what they normally do, use governmental power to force people into their factories. They used every dirty trick in the book to get people off of the land and onto factory floors: laws were passed, taxes were levied, etc. You know the routine.

These are the same people who, today, laud how self-regulating markets are, that markets can organize our economies to be “Yuge, really yuge.”

As I mentioned in that post above: “From foragers being forced off land they’ve lived on for centuries because they cannot produce deeds of ownership, to eighteenth-century Scottish Highlanders who preferred to tend their sheep, to today’s college graduates saddled with tens of thousands of dollars in debt before they’ve landed their first job, nonparticipation in the market economy has consistently and effectively been eliminated as a viable option. To those who suggest we should “Love it or leave it,” I’d suggest that neither option is—or has ever been—a realistic possibility. It’s as if people are being forced into casinos at gunpoint, where they lose everything, generation after generation, and then they’re told they’ve got a gambling problem.”

December 15, 2020

Important: Before You Line Up for the Pfizer Vaccine . . .

Filed under: Economics,Reason,Technology — Steve Ruis @ 8:25 am
Tags: , ,

I think it is imperative that you read this article. The hand waving going on in the news media, even scientific publications, is of the kind magicians use: to distract you from what the other hand is doing.

An Internal Medicine Doctor and His Peers Read the Pfizer Vaccine Study and See Red Flags [Updated]

December 11, 2020

It Is As If We Can’t See What Is Right In Front of Our Eyes

The plutocrats running the US have decided that it would be a good thing if much of the school systems in this country were privatized. They claim, without evidence (as they are religious people), that this would make our schools better. The question, of course, is “Will it?”

We don’t have to guess or pray or wonder as the experiment has been done. The primary example is Sweden (or should be). Sweden had a school system that we wished ours was. Here is what happened when Sweden decided to copy the US’s fledgling efforts.

Per Kornhall: The Great Swedish Child Experiment: A Failure

It is clear that the plutocrats who have gotten both the Republicans and Democrats to chase this folly have no idea what the outcome of our experiment will be. They only want a piece of the action which is all of the money spent by our governments in public schools, a rather tidy sum. It is clear that the plutocrats have dominated all of the other areas of our economy in which big bucks are available: the stock markets, resource extractions (oil, coal, natural gas, etc.) and had run out of sources of big pools of money when they spied public education, which had already acquired a big pool of money . . . yum, yum.

So far, our experiment with privately run “charter schools” is that on average they perform no better than our public schools, but which are also rife with racism and . . . corruption. It seems that there is a charter school scandal announced in the news on a daily basis. If these were public schools, such behavior would be a national scandal.

Gosh, why would something so potentially good go so wrong? (Sarcasm alert! Sarcasm alert!) With no qualifications needed to start a school, and no government oversight, and no regulations (those pesky regulations!), those schools should be thriving, right? They are thriving, as pools of corruption. Millions upon millions of dollars have been lost to sketchy real estate deals, flat out theft by charter operators, and graft. But that’s a small price to pay for non-existent performance increases, right? Right?

The plutocrats do not give a rat’s ass about equality, quality schooling, or any of the things Sweden lost in its experiment. What they do care about is their ideology . . . as long as it makes money for them. It is very clear that they do not care about us, or our children, or anything but getting richer. Us becoming disempowered in the process is not a bug, it is a feature. “Us,” in the form of governments, are the authors of regulations confining what the rich can do with their money, so they have no interest in empowering us, quite the contrary.

Please note, if you do not read the post I linked to, when Sweden had its former system, Finland copied it. But when Sweden went “a privatizing,” Finland didn’t follow. The results on international testing are obvious. Finland is at or near the top . . . and Sweden had the greatest drop in scores of any country being tested. So, should we be on the same path that Sweden is on? Only an idiot would say yes . . . and many of those idiots are in our government houses right now. Did I tell you that it is perfectly legal for charter schools to “lobby” (aka bribe) our state and federal governments (and it is not legal for public schools to do likewise)?

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