Building through the privatization-friendly Reagan-Bush era of the 1980s, ramping up significantly with Bill Clinton’s signing of the North American Free Trade Agreement (NAFTA) in the 1990s, and solidified through the de facto repeal of the post-Great Depression separation between investment and commercial banks at the end of Clinton’s scandal-plagued final term in office at the turn of the millenium, the United States went through a very noticeable shift in how its economy functioned. Even people who didn’t pay attention to such things could feel it.
While the fundamentals of large-scale state capitalism remained—in which the U.S. government used debt and taxpayer dollars to provide the corporate sector with expensive research and development (the internet, for example), and offered crucial patent protection, favorable interest rates, extra cash in the form of subsidies, a wonderfully loophole-ridden tax code, near nonexistent enforcement of antitrust and environmental law, suppression of trade unions, and the stacking of government jobs and judicial appointments with pro-corporate professionals—the actual physical manifestations of the U.S. economy that those structures support were abandoned in ways they never had been before.
No longer did large investment firms or the stock market spend their time rewarding companies that invested in their own development, equipment, channels of distribution, growth and productivity of their workforces, etc. NAFTA, with its incentive to move jobs to other countries (particularly Mexico, which has even fewer environmental protections and drastically lower labor costs), made much of that boring, analytical work unnecessary.
So what was the newly unleashed finance sector of the economy supposed to make real money off of? Sure, they could preside over the mammoth corporate mergers and acquisitions that Reagan had freed up. That brought in some cash. The newly released internet offered speculative benefits as well. But the real money turned out to be, ironically, in the absence of money. It turned out to be in debt. Corporate debt, which could be packaged up into securities and sold to investors, but even more, the debt (mostly mortgage-related) that regular citizens were racking up to maintain their lifestyles in a less welcoming economy. Now that….oh wow, the transmogrification of that shaky debt into securities was the true windfall.
All of this fiddling around with debt was the hallmark of an economy that now focused much of its energy on finance and imaginary “products” that had no real physical presence in the real economy. We all know what came of that in 2008. One of the best explainers of how and why our economy—and indeed the world economy—blew apart was Matt Taibbi who, in a colloquial and hilariously sarcastic series of articles in Rolling Stone, famously described the investment bank Goldman Sachs as “a great vampire squid wrapped around the face of humanity, relentlessly jamming its blood funnel into anything that smells like money.”
The Next Financial Frontier
All of this is old hat by now, right? Nothing about this current formation of our economy has really changed in the decade following the crash of 2008. Obama gave our money to the debt-ridden banks; a shit-ton of people lost their jobs and their homes; local tax revenues dried up; and the propped up and bloated finance sector simply found a new way to profit off citizen debt by creating securities out of student loan and car loan debt. Capitalism, in its current American form, could only really make money, easy money, fast money (for an ever decreasing slice of the population) out of made-up financial illusions.
Even if you subtract the recent and growing social unrest—seen through the brief flash of the quickly beaten down and co-opted Occupy and Black Lives Matter movements, the proliferation of white nationalist and xenophobic groups, and the explosion of voter political disobedience in the forms of the 2016 Sanders and Trump campaigns—American capitalism has clearly been running into a dead end. Right now, even the biggest fans of our current economy in the financial world are anticipating a train wreck in which the latest debt bubble, which also includes corporate debt, will explode, leaving even more people in desperate trouble as a result.
This is the context that Cory Morningstar is operating in with Act III of her multi-part series called “The Manufacturing of Greta Thunberg. For Consent: The Most Inconvenient Truth. Capitalism is in Danger of Falling Apart.”
You can listen to the piece here and I believe you can learn a lot from it.
And you can hear Acts I & II of the series through the Words of Others podcast.
As Cory documents through the various sections of her article—particularly in her exploration of the investor-backed and nominally African solar power provider M-Kopa—the goal of the Western corporate elites who are operating in the background of “climate strike” activists and the organizations with which they’re affiliated is not to find a way out of a dead ending capitalism. It is not to engineer a low-carbon, less consumptive, less polluted, more equal world. Not at all. They’re trying to engineer what is essentially a fantasy—a slightly less carbon producing, still consumptive, slightly less polluted, equally unequal world that maintains the current position of the elite capitalist class (a class they all belong to).
To make that happen, it’s all about inflating a new financial bubble. As Cory explores, using a variety of primary source material, if the debt of corporations and regular citizens could be turned into financial securities and sold as investments to hedge funds, pension funds and other institutions, then why not create a new form of debt related to greening the economy? And why not do it on the backs of the poor and the non-white? And why not prove the investment potential of that debt so it can be similarly securitized and sold by major financial firms? Capitalism rescued! At least for a little while longer.
This is what Al Gore and his cohorts are trying to unlock. This is their mission. And guiding inspirational movements led by relatable teenagers such as Greta Thunberg is how they gain the critical mass among the general population they need to grease the wheels of government and industry and make their banal dream a reality.
It’s this insight that make’s Morningstar’s series so important. She is trying to help you see the wolves and their sharp smiles peeking out from behind those cuddly lambs you want to help and support.
As always, thanks for reading and thanks for listening.
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