The Utility of Terror

Terror is a wonderful tool, opening wide the door of opportunity.

Foreign adventures and profit go hand-in-hand, but the obvious link–war profiteering–may well be far less significant than the effectiveness of international tension as a curtain to obscure from a naive public the domestic activities of the rich. And terror provides the very best route to blinding the public. As the public reacted to 9/11 with panic and rage, the super-rich surely profited from the war directly by selling war materials to the U.S. Government, but the real source of wealth for the super-rich came not from the War on Terror that the Government claimed to be fighting to “protect” Americans but from a secret war by Big Finance against the American people. In the post-9/11 panic climate, who was in the mood to complain about mortgage fraud or esoteric Wall St. securities bets against Wall St. clients? It would be very difficult to make the case that the simultaneous occurrence of the decade-long war scare and the astounding simultaneous mega-theft by Big Finance that enabled the astronomical self-enrichment of the richest of the rich was a mere coincidence.

As illustrated by the blue lines on top of the Highest Quintile bar above, the real action occurred in the top 1%:

The rapid growth in average real household market income for the 1 percent of the population with the highest income was a major factor contributing to the growing inequality in the distribution of household income between 1979 and 2007. Average real household market income for the highest income group nearly tripled over that period, whereas market income increased by about 19 percent for a household at the midpoint of the income distribution. As a result of that uneven growth, the share of total market income received by the top 1 percent of the population more than doubled between 1979 and 2007, growing from about 10 percent to more than 20 percent.

Since 2007, conditions for the average American have only worsened. According to a recent Census Department report:

The official poverty rate in 2010 was 15.1 percent—up from 14.3 percent in 2009. This was the third consecutive annual increase in the poverty rate. Since 2007, the poverty rate has increased by 2.6 percentage points, from 12.5 percent to 15.1 percent [DeNavas-Walt, Carmen, Bernadette D. Proctor, and Jessica C. Smith, U.S. Census  Bureau, Current Population Reports, P60-239, Income, Poverty, and Health Insurance Coverage in the United States: 2010, U.S. Government Printing Office, Washington, DC,

In addition, according to the Census Bureau, poverty has continued to rise [14] and the number of employed has continued to decline [12] even since the official end of the recession.

Whether war or just the threat of war, insecurity “justifies” handing taxes over to war industries at the expense of government services to the population and makes those who complain appear “unpatriotic.” Until the 2008 Financial Crisis exposed the nakedness of the emperor with Wall St. billionaires begging for taxpayer-funded Big Government welfare, few realized that it was in fact the Kings of Finance who were the unpatriotic ones.

That bin Laden trapped muscle-bound America into a war of aggression against Islam that he had no hope of provoking on his own is now obvious. Devious and subtle as he was, perhaps we will never know if bin Laden was so far-sighted as to have invested in major Wall St. firms back in 2001. But it does not take much imagination to figure out that a government launching a global war amid popular panic is unlikely to crack down on domestic corruption by its closest supporters.

The true cost of war goes far beyond the directly expended blood and treasure. Wars undermine domestic investment and civil liberties. More, wars create a climate that impedes social reform. Wars encourage blind faith in whatever leader happens to be in the chair and focus attention on intensification of the war effort at all costs. Simply put, wars and democracy are mutual exclusive, and the war years have proven to be a great gift to the super-rich.

For the graphs to explain what is happening, see Mother Jones.


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