Too Big to Exist

When corporate or government institutions become too big and too socially destructive to exist, we need a graceful method of putting them on a diet and reforming their lifestyle.

The American genius for creating magnificently productive mega-institutions has a potentially fatal downside: we have, as a society, no idea how to downsize them when they “go rogue,” i.e., become socially destructive. On balance, today, several of America’s major mega-institutions–the Imperial Presidency, Big Oil, Big Pharma, and Big Finance–either are or are fast becoming socially destructive. They are “too big to exist;” we need to figure out how to downsize them gracefully, reorienting them toward socially useful behavior.

Perhaps the first step toward this new way of thinking that needs to replace the tarnished old “bigger is better” mantra is to understand the evidence supporting the contention that these mega-institutions are so bloated that American and, indeed, global society can no longer afford them. (I call these social units “institutions” because each is truly a unified organization composed of, perhaps, separate governmental or private units, but operating according to a clear if unstated and frequently illegal set of monopolistic rules designed to maximize profit and power at public expense and, in the case of the Imperial Presidency, at the expense of the rest of the Government as well.) Consider the following examples of mega-institution misbehavior:

  1. The Imperial Presidency, i.e., the rising ability of the White House and all its military-industrial support mechanism to overshadow Congress and Constitution on foreign policy, now employs something in the neighborhood of a quarter of a million mercenaries overseas, constituting an armed force capable of making independent war on most countries–completely outside of Congressional control and often beyond the reach of U.S. judicial authorities [see Jean MacKenzie, Jeremy Scahill, Glen Ford]. Since Augustus overthrew the Roman Republic with his palace guards and established the Roman Empire, we have known the profound threat to democracy posed by a mercenary army under the command of the chief executive.
  2. Big Pharma, constituting the whole U.S. health care industry, has degenerated so far that, to boost profits, it now essentially writes off as a “business loss” all of the nationa’s elderly with the almost universal cognitive problems associated with aging. At their most vulnerable, they are thrown into the arms of untrained relatives utterly unprepared for 24/7 nursing.
  3. Big Oil, alb eit receiv ing billions annually in welfare payments from U.S. taxpayers, can destroy ever-growing chunks of the earth through careless cost-cutting measures and escape responsibility. For the rest of our lives, we will be watching BP’s poison creep with Gulf Stream currents up the North American east coast and over toward England, while everyone complains about $4 a gallon gas, a price only a fraction of the real cost.
  4. As for Big Finance, the cost of its irresponsibility is now glaringly obvious to everyone. At the very least, Wall St. should keep accurate books, and regulators should scrutinize them.

The traditional way of toppling rogue mega-institutions is of course well known: the “barbarians” did it to Imperial Rome, Lincoln did it to the Southern slave system, Gorbachev did it to the Soviet state. But as these mega-institutions take on global scale, the cost of violent overthrow rises sharply. We should be able to do better.

Key to the smooth downsizing of rogue mega-institutions is twofold: 1) the breakthrough understanding of the bottom line insight that a cherished social structure has outlived its usefulness as currently designed combined with 2) the identification of specific traits requiring elimination. Specific reforms (Step 2) without acceptance of the goal of institutional downsizing, and redirection into a socially beneficial mode misses the point. That was the mistake of the Wall Street bailout, which successfully saved the bad old exploitative system rather than taking the opportunity to dismantle it by, for example, rebuilding the wall between the stock market and personal savings accounts. Similarly, eliminating mercenary forces while leaving the political supremacy over Congress of the Imperial Presidency untouched will only have a temporary impact. Surgical removal of a specific cancerous tumor must be done in the context of lifestyle changes related to nutrition, avoiding pesticides, and exercise.

Rogue mega-institutions must be recognized as enemies of society and redesigned to return to their proper purpose of servinhg society. The Presidency’s power should be balanced with that of Congress; stock market investments should b e used to stimulate growth, not gamble with people’s mortgages and savings accounts; the health care system should exist to provide a universal right, not to make a profit; the cost of gas should b e set by government to reflect its true value, incluyding the cost of pollution clean-up and the cost of wars fought to get the oil. And no industry that takes welfare from the taxpayer should turn its leaders into billionaires immune from prosecution.


To its credit, Washington is at least thinking about this issue. See comments by FDIC’s Sheila Bair.


The Pattern of Democratic Decline

It is not about tinkering; it’s about making moral judgments.

The ramparts of American democracy remain strong, if subtly undermined by long-term trends I have discussed elsewhere. The gathering hordes stand not at the walls but within and can hardly be called “hordes” at all, though they are, because a rampaging crowd of the rich is not what the term “horde” typically brings to mind. But it is the rich of America, not the poor of the world, who are focusing their energies against us. If American democracy is to be successfully defended against these, well, hordes–for they are multitudinous and they are running amok, then Americans must come to understand the context of events so they can give proper meaning to those events.

Politicians’ lies about the reasons for sending American soldiers to die in foreign lands might perhaps be explained away, though we forgive such sins at our peril. Financiers’ attempts to destroy government regulatory oversight and carve out special exemptions from anti-gambling statues in a mad rush to get rich quick with our money may be interpreted by the generous as just another example of “boys will be boys.” The eagerness of the banking community, which–as the place we all put our money for safekeeping–should be the most conservative and risk-averse institution in society, to join in the fun and games ought at least to begin to give one a funny feeling in one’s stomach. The viciousness of the battle to provide health care as a right rather than a privilege for the privileged could only shock any foreigner, but the U.S. remains, as we members well know, something of a primitive, frontier society with a long list of its own special prejudices, and the idea that society should ignore the health of the poor has always been one of the most cherished, so, self-defeating as it may be, at least it is nothing new. The egregiously contemptuous attitude toward the environment of BP and the sickening effort by Washington to kiss up and explain away BP’s flouting of the rules is also just the worst of an endless series of needlessly and inexcusably rapacious thefts by corporations of America’s dwindling heritage; inexcusable but hardly surprising. And now, after a decade of astonishing examples of corruption and irresponsibility, the latest is the emerging scandal of the clearly intentional, industry-wide practice of corruption in the process of foreclosing and reselling homes, i.e., the process of kicking people out on to the street because, most likely, they lost their jobs in the recession that same financial elite created and the process of selling those homes to unsuspecting buyers. It’s quite a coup when a middleman can manage to cheat both buyer and seller.

Each of the above events, in isolation, can be explained away as a bad apple in a good barrel, but when you put any one of them in the context of all the others, the picture becomes vastly darker: a pattern of fundamental corruption across virtually all of the major institutions of American society, an elite gone mad with greed and short-sighted irresponsibility…gamblers burning down the barn in which they raise their racehorses in order to collect on the fire insurance.

There is, fortunately, some good news. The media, albeit vastly compromised, did finally bring itself to write up this scandal, though rather later than it perhaps should have, and Washington now seems to be taking notice. If democracy is on life-support, at least its heart continues to beat, though there is precious little evidence of any willingness to adopt a more healthful diet.

More seriously by far, the voters seem oblivious to the underlying message of this long pattern of corruption: it is not a matter of tinkering with administrative procedures but of facing up to immorality at the heart of society. The “elite” in America may be trying its best to make itself hereditary, but it still is not; the “elite” is composed of all who “make it good,” and they are making it good by cheating. If Big Finance can only succeed by impoverishing the society off which it lives, if oil can only be pumped by poisoning the nation’s fisheries, if politicians are to be allowed to get away with starting wars on false pretenses that leave the country less secure and more impoverished, then America is sliding down a slippery slope.

Those who make good by cheating must be punished – perhaps because they deserve it but more to teach the lesson that a democracy cannot tolerate such behavior and survive. It is not yet 1917 in America nor is it 1789, but the tsars and the kings did not see their revolutions coming either. Reform during a revolution is more likely than not just to pour gasoline on the fire. However, to punish the guilty, one must make a moral judgment, and that is precisely where America is in denial.

Obama & Derivatives: Stiffening Backbone?

Good news is hard to find, but there’s a little in Washington this week and on the critical issue of (sorry!) derivatives. So I’ll report it…

Health care reform was a great win for Obama; a small step forward for the American people. International relations to date has been a disaster both for Obama and for those hoping for a peaceful world (witness the collapse of efforts to resolve the Palestinian-Israeli conflict, the carnage in Afghanistan, and the failure to engage Iran). Finance policy has been a complete sell-out to Wall Street so far, but this may be about to change. Might the health care victory give Obama the guts to support actual reform rather than trying to “achieve” a lowest-common denominator back-room deal with Republican diehards? Standing firm on derivatives regulation and winning could just possibly turn Obama into a real leader. Then, his best move would be to read his own campaign promises.
If you don’t know anything about the intentionally mysterious Wall Street invention called “derivatives,” here is Derivatives 101, from Time’s Swampland Blog, 4/14/10:
Everyone agrees that new derivatives regulations are needed to head off another financial implosion, but there is huge disagreement about which derivatives should be regulated and how.
Complicating things further is the fact that the five largest banks–Goldman Sachs, Citibank, J.P. Morgan, Morgan Stanley, Bank of America–control the vast majority of the derivatives market, and make a mint doing it. As it now stands, derivatives are largely traded over the counter, meaning they are private arrangements between two or more parties. Without a transparent market, banks are able to take a significant cut off of each trade, yielding roughly $20 billion in profits last year. The problem is that this same system conceals risk. Without transparency, regulators cannot know for sure whether banks or other parties in derivatives transactions actually have the ability to pay off their bets if things go bad. The system functions very much like a dimly lit casino, but in this casino some people bet with far more money than they have or can get. When the dice come up box cars, taxpayers must come to the rescue, or watch the markets freeze in fear.
A more authoritative bottom-line assessment was provided by economist Joseph Stiglitz last fall [Bloomberg, 10/12/09]:

Large banks should be banned from trading derivatives including credit default swaps, said Joseph Stiglitz, the Nobel prize-winning economist. 

The CDS positions held by the five largest banks posed “significant risk” to the financial system, Stiglitz said at a press conference in Brussels. Big banks should have extra restrictions placed on them, including a ban on derivative trading, because of the risk that they would need government money if they fail, he said in a speech today.
“We will have another armed robbery unless we prevent the banks, the banks that are too big to fail,” Stiglitz said. “We should say that if you’re too big to fail then you are too big to be. They need more restrictions, such as no derivative trading.”
My pulse is quickening, but I will really believe that Obama is serious about financial reform when he advocates that derivative trades be taxed.
My personal bottom line is simple: let the rich trade derivatives all they want, but with as much transparency as we demand from Iran on nukes and with taxation of the profits at a rate at least equal to the taxation of honest labor. 

If you thought the ideas of compromise as the route to peace and health care as a right rather than a cookie crumb trickling down from insurance company profit-making were hard concepts to understand, the legitimate use of derivatives in a democratic society will really curl your hair. But try: this issue is important.


Robert Reich’s broad view of governance from his blog on 3/21/10:

…Reagan’s view of government as the problem is increasingly at odds with a nation whose system of health care relies on large for-profit entities designed to make money rather than improve health; whose economy is dependent on global capital and on global corporations and financial institutions with no particular loyalty to America; and much of whose fuel comes from unstable and dangerous areas of the world. Under these conditions, government is the only entity that can look out for our interests.

Reich did not say that government will look out for our interests obviously, but since you don’t vote on the policies of Exxon-Mobile or Goldman Sachs or Xe, your only prayer is the vote you make to select your government officials…and the quality of your oversight.

"Change"…and Deception

Americans may never know the degree to which Democratic Party leaders actually intended to promote “change.” Perhaps we the voters should have demanded that they “prove” their intent, just as they are currently demanding that Tehran “prove” that it has no intent to construct nuclear bombs. Whatever the intent of the elite, the people voted for change, and one key component of that was changing medical care from a business designed for the enrichment of insurance companies to a right of all citizens.

The right wing elite, concerned about its potential investment losses, is now claiming that legislating any requirement that everyone pay for health insurance would be unconstitutional. One wonders what they imagine we, as a society, are going to do when some irresponsible person who chooses not to buy health insurance gets sick – just watch them die? This is a classic example of the commons, a term everyone needs to know in this debate. The right wing elitists are classic free-loaders. Don’t be tricked by their protests about “freedom.”

You are not free to drive on the left. You are not free to refuse to pay for garbage pick-up. You are not free to take illegal narcotics. You are not free to refuse to “buy” health insurance for your sick car (i.e., annual check-ups). You are not free to refuse to pay taxes. Societies need rules to function. It is time the U.S. joined the modern world and recognized that a good society provides health care for everyone. One way or the other, we will all pay for that benefit: either we will pay to take care of the desperately ill (e.g., the beggar who sits on the street coughing and infecting everyone with TB) or we will gain the maturity as a society to decide to pay for health care to make the society healthier.

Building Civil Societies…Not State Predators

The Washington debate over the relative merits of brute force vs. state building is, in practice, vacuous. The real choice is between brute force and society building, an endeavor in which the members of the society must be central…and free to talk back to their foreign friends. The building of a centralized and powerful state structure divorced from society is the birthing of a monster.

The debate in the U.S. about how to resolve social instability in Muslim lands that may lead to terrorist attacks against the West frequently centers on the presumed choice between “state building” and military attacks on those identified as enemies. This raises a host of issues, not the least of which is figuring out whether or not Western victims actually are enemies, but that is another story. Here, I want to focus on the concept of “state building.” Bluntly stated, the above debate is so simplistic that it hardly has any value at all (even though on the surface the existence of a debate between war and state building appears to represent a huge step forward from the utterly brainless idea of blowing up everyone who expresses the slightest desire for independence or equality).

The only way “state building” will in fact represent a meaningful advance in U.S. thinking is if the concept is defined well enough to contribute to functioning societies. To put it differently, arguing about “more” or “less” state-building is vacuous. The distinction of value lies not between state building and military force but between effective steps to stimulate the rise of self-sufficient, stable, effective societies and steps that hinder such a process. Both war and the building of repressive state represent steps backward.

The missed point in most U.S. commentary on state building is the dangerously erroneous assumption that having a state is better than not having one (an assumption particularly unexamined in Washington and one that leads directly to assuming that anyone who has managed to seize power—say, via assassination—is a better person to work with than someone, e.g., Sam Adams, who “just” represents a patriotic movement demanding justice). It may in a given case make sense for Washington to deal with a local leader, but to assume that a Saddam or a Saleh deserves automatic respect while a dissident leader merits nothing more than dismissal would be a potentially costly (though hardly unusual) example of unprofessional behavior on the part of a foreign policy decision maker.

The assumption that a state is automatically better than the absence of a state would have been rejected instantly by a large number, probably a large majority, of the august men who created the U.S.A.: in no uncertain terms they placed rights (of both individuals and the 13 colonies) ahead of state power. Had the New England colonies insisted on giving priority to centralized state power, it is doubtful that a unified country would ever have come into being.

A discussion of “state building,” if not clearly defined, is dangerous because it is all too easy for Westerners to assume that means “a Western-style state” or at least “a centralized state.” There is no consensus in many non-Western societies that such a political system is desirable, not to mention any ability to create or manage it for the good of the population (a point sometimes realized all too clearly in a Washington insistent on obedience).

Without both a social consensus that a centralized state is the goal and the ability to manage it for the good of the people, the infusion of aid may amount to empowering whatever predatory mafia may happen to agree to sell itself to the patron. Washington is not the only patron vulnerable to such errors:

The republics of Dagestan and Ingushetia are flashpoints, and Chechnya, newly pacified after years of war, is again experiencing a spate of terrorist attacks. Moscow’s strategy of buying off corrupt local elites in the region has not purchased stability. Islamist radicals thrive on official corruption, interclan warfare, and the heavy-handedness of the police and security services. [Dmitri Trenin, “Russia Reborn,” Foreign Affairs Nov-Dec 2009, 69.]

A better phrase would be “civil society building.” What pre-modern societies often do need is a hand in improving civil societies that, under the stress of interaction with the modern world, have ceased working. Somali civil society, for example, began to fail in the 1980’s after years of superpower interference succeeded only in substituting a nasty dictatorship for old decentralized, clan-based decision-making processes. Similarly, Afghan society was derailed by decades of superpower interference seeking to design modern centralized state structures from the top down. In neither case were the new state structures, when they existed at all, (e.g., tax collection agencies, health care provision agencies, police) effectively connected to the underlying social building blocks of clans, tribes, ethnicity, and religion.

Even after accepting that the focus should be on civil society rather than central government, a danger still remains. Civil society cannot be “built” from the top down or from the outside in. Yes, a supportive global community can help protect a Somalia or Yemen or Bangladesh or an Afghanistan from external threats, but “society,” by definition, is composed of links among the members (Robert Putnam’s bowlers). Incentives can be offered, but the “bowlers” have to decide on their own to bowl together.

Example of how everything can go wrong include when a strong central state imports modern weapons and then gasses the Kurds or uses helicopters to attack villagers in punishment for participating in traditional religious ceremonies that have been banned by a repressive centralized state (as Yemen’s President Saleh is accused of having done). This video of the aftermath of a U.S./Yemeni regime military attack on a dissident Yemeni movement in December 2009 is not an example of “building civil society.” Since the military structure of state government is easier to build than, say, a health care system, and easier to misuse for private purposes, it moves almost inevitably to center stage when a modern, centralized regime is imposed on a premodern, decentralized society. Creating a powerful state before a powerful national civil society has arisen to prevent centralized state abuses of power is exactly the wrong way to go about creating stable, peaceful societies.

So if the creation of potentially oppressive state structures is a key mistake to be avoided, what might be some ways to do things right?

Sponsor civil society dialogue. Demand that any central government desiring Western support first accept the idea of a national dialogue to be followed up by real steps to address dissident demands. One could imagine, for example, conferences to which all dissident groups would be invited. Of course, a predatory regime will use this occasion to identify dissident spokespeople. Therefore, the West needs to be proactive in making its own contacts with those individuals, raising their international visibility, and warning the regime that their disappearance will be taken very seriously. Washington’s first step regarding Yemen should have been to sit down with the leaders of the Houthi and southern dissident groups, not the provision of arms to the regime. Dissident groups should learn that they have peaceful choices. The same argument of course applies to Hamas. It’s not about approval; it’s about stimulating the marketplace of ideas instead of the marketplace of militias. The U.S. should present itself as the defender of peaceful political participation, not as the defender of pet regimes.

Use international peacekeepers to protect civil society, not the regime. In contrast to the Somali model, where an African peacekeeping force supports the government, station international peacekeeping forces in all regions of the country but with direct links in each region to the regional political structure. The goal of the peacekeepers would be to prevent the military suppression of dissident groups in return for agreement by the dissident groups to refrain from violence, thus both offering incentives to behave peacefully and marginalizing those who refuse. In the Somali case, even the most extreme of the groups, al-Shabab, is composed of various sub-groups. In Afghanistan, the heterogeneous nature of “the Taliban” has been widely reported.

The regime, enamored of its own power and privilege, will of course argue that this would “promote disunity.” Precisely so. In a pre-modern society, disunity is the goal. No consensus exists on the form that unity should take. That is the whole point. Until civil society has achieved consensus, confederacy is wiser than centralization. Moreover, the artificial imposition of unity from the outside will almost always go wrong: from Polk’s misunderstandings of Mexican politics through the Vietnam War escapade to the abysmal ignorance of the neo-cons about the complexities of global Islam, history has shown that Washington does not have the eyesight to perceive the George Washingtons or Abraham Lincolns of traditional societies.

Form an American "People’s" Party

Can national government that puts the interests of the American people ahead of short-term elite interests be achieved within the contemporary party structure?

The steady decline in U.S. national health care management, financial system regulation, environmental oversight, and national security in recent years—trends not reversed by the election of Obama—all point to one conclusion: it is time for the American people to start defending their interests against the elite. In each of the above arenas, the perspective of the elite is exactly the opposite of the perspective of the average citizen.

Health care. U.S. health care for the rich is superb; it is “only” the workers, not to mention the unemployed, and our elderly parents on pensions, and the children of young parents just beginning their careers who risk being denied affordable health care. Not only does the elite have no health care problem; the elite also benefits from the current lucrative health care industry by being able to invest with the certainty of a profitable return: there will always be plenty of sick people, and as long as the health care system is designed to make a profit, a profit is exactly what it will make.

Finance. As for the financial system, the glaring contradiction between the recent surge in Goldman Sachs profits marching step-in-step with the surge in unemployment says it all. The U.S. national financial system still contains a good bit of money (at least so long as the Chinese don’t call in their loans); the allocation of that cash is the issue, and since the beginning of the new and now evidently endless Federal bailout of bankers and Wall St. gamblers, the elite has had little reason to complain about the allocation of the cash.

Environment. The environment is not even perceived by the elite as a “separate system;” rather, it is, for them, part of the financial system…just like health care. The environment, for the elite, consists of such goodies as national forests that their corporations clearcut, leaving behind a desert that cannot return to normal forest growth. Surely, the government (i.e., the taxpayer) at least gets a reasonable return for selling the national wealth to corporations? Well, no, actually the ruling elite essentially gives the trees away, in a classic “socialism for the rich” escapade that voters are too lazy to protest.

National security. National security is a bit harder for the average person to understand. The rapid spread of U.S. military bases throughout the Mideast and Central Asia (castles literally built on sand), the endless military victories in every “face-to-face” encounter between the world’s most high-tech force and 19th century insurgents, the dramatic media portrayals of the day’s little troop surge, and dominant position in national debate of stern-faced generals calling for more war (because the generals opposing war seem to get themselves sacked and then blacklisted by the compliant media) all give the impression that—whatever Washington may be doing to the rest of the world—at least U.S. national security is being well defended. Unfortunately, those foreign bases are like the dikes around New Orleans: imposing structures but not designed for the job. Those bases would have stopped Stalin’s late-1940s push into Iran cold; they would have stopped the Soviet 1978 invasion of Afghanistan cold. And they would serve marvelously as launching pads for regional aggression. But in the context of Iraq or Afghanistan, they are recruitment posters for al Qua’ida.

The bases, the surges, the endless expensive high-tech conflict all do have one undeniable characteristic, however: they are very good for business. Blackwater, by whatever name, is doing booming business running a mercenary army outside of Congressional control, and the need for weapons and machinery and construction is endless.

So for the elite, these four critical national problems that are as plain as day to citizens simply do not exist. The state of health care, the state of the financial system, the environment, and the state of national security are, for the rich and powerful, not problems but opportunities. Speaking in another era about a different issue, in his series of 1858 debates with Steven Douglas, Lincoln criticized Douglas’ defense of racism as “blowing out the moral lights around us, eradicating the light of reason and the love of liberty in this American people” [as quoted in Doris Kearns Goodwin, Team of Rivals, 207]. Lincoln argued that the “real issue” was “the same spirit that says, “You work and toil and earn bread, and I’ll eat it.’ No matter in what shape it comes, whether from the mouth of a king who seeks to bestride the people of his own nation and live by the fruit of their labor, or from one race of men as an apology for enslaving another race, it is the same tyrannical principle” [208].

Many problems in life are unfortunate situations that man must learn to cope with. It is important to remember that the state of U.S. health care, finances, the environment, and national security result from choices intentionally made by the ruling elite. The critical problems in all four arenas do not result from nature or foreign enemies; we Americans did it to ourselves. More specifically, the elite did it for private purposes while the rest of us were out at the mall.

The rich are surely deluding themselves if they imagine that their exploitative behavior can endure endlessly, but there is little reason to think that they are worrying much about the lives their children will live: the view of the complacent is a short-term one. As far as their own personal prospects are concerned, on the other hand, the rich tend to know exactly what they are doing.

It is, for example, now well known that Wall Street investors were so sensitive to the possibility that they would be indicted under anti-gambling laws for the highly dangerous new derivative investment practices they planned around the turn of the century that they persuaded their Congressional allies to pass a law exempting them from the anti-gambling statues. So they gambled, they lost—provoking the worst recession since the Great Depression in just five years, and right before leaving office the Bush Administration used taxpayer funds to compensate them for their losses. The Democratic side of the ruling group, complicit in passing the original exemption under Clinton, avoided any serious protest.

And the key national security decisions being made by Washington in recent years have been choices not necessities, far different than, say, the unpalatable constraints faced by decision-makers when Hitler began his global adventure. But it is not just the obvious fact that Iraq was a war of choice unrelated to the struggle against bin Laden that makes the current situation so different from facing an invasion. The original decision to respond to 9/11 with war rather than a police action was itself a choice, as was the decision to invade Afghanistan rather than give diplomacy a chance. The argument applies to any number of major decisions since 2001 as well, including the choice to destabilize the 2006 Palestinian regime after Hamas won a democratic electoral victory, the choice to support Israel’s 2006 invasion of Lebanon, and the choice to rely on threats rather than inducements to influence Iran. Needless to say, aside from the occasional protest of a Dennis Kucinich or Mike Gravel, the Democrats were fully complicit in the fundamental U.S. post-9/11 national security strategy as well.

Given the depressingly rapid evaporation of the enthusiasm evoked by the electoral message of “change,” it is hard to avoid the conclusion that the Democratic side of the ruling elite is far too complicit in the fundamental elitist policies on health care, economics, the environment, and national security to offer a strategic alternative.

In sum, it appears that only a reorganization of the national political structure akin to that when the then-innovative and crusading Republican Party was invented in 1856 will open the door to the policies required to protect American society in the 21st century.

The very secretive White House discussions about Afghanistan, discussions that evidently focused on tactics to the exclusion of any serious examination of fundamental strategy, are the most recent and most blatant case in point. Was the question of a non-military solution that addressed the needs of the Afghan people and the dangers of a global heroin epidemic even raised by the little group of military men and conservative politicians at Obama’s table? Does Obama even know Malalai Joya’s name? The rigid White House attitude toward Iran, at a point where the Iranian domestic decision-making process had obviously crumbled into incompetence and needed breathing space for restructuring, and utter caving in to pressure by Netanyahu complete the circle: the wagons of traditional national security thinking in Washington are drawn tight against the arrows of innovation.

Similar arguments could be made for the attitude toward alternative policy options in the other key arenas, but perhaps a brief checklist of what those alternatives might be will suffice:

  • Empire – oppose it, for empire is democracy’s worst enemy; cut back foreign bases and resurrect diplomacy as the conflict resolution tool of choice; on Afghanistan, take the moral high road by focusing on ending the drug trade and minimize American boots on the ground by urging a global Islamic crusade to protect the Afghan population; on Israel, support the population but oppose the Greater Israel mini-empire project;

  • Health care – a service and a right for all;

  • Environment – start with strict enforcement of current laws to protect the nation’s air and drinking water; restructure the tax system to, at a minimum, make corporations pay reasonable market prices for access to national forests and mineral resources; include environmental degradation in calculations of cost;

  • Economy – regulate first, compensate second; compensate individuals first, main street second, Wall St. last; tax to encourage work rather than financial manipulations (e.g., tax each derivative trade at a rate greater than the income tax rate paid by the average American worker).

Those are just a taste of the banquet of policy options available to a patriotic U.S. government dedicated to serving the American public. But getting there will require that the American people realize their own best interests and organize to defend them.

Government: Not Size, but Purpose

Good governments–big or small–exist to serve; bad governments exist to exploit. That is the issue.

Governments always exist. The issue is not the existence or size of government; rather, the issue is whom the government serves. As long as Americans waste their time debating the meaningless question of how big a government should be, reform will prove an illusion. Perhaps that is why so many who oppose reform insist on raising this straw man.

The first time a local bully demanded subservience as the price of avoiding a punch in the face, government was established…or, one might respond, the first time two neighbors shook hands and agreed to protect each other from roving wolves. When Goldman Sachs wanted its bailout to pay it back for gambling away billions of investor contributions, it demanded Big Government. When Big Oil wants a tax break, it too demands Big Government. And of course when the American voter wants the world’s best superhighway system, he and she also want Big Government. Big Government for me; Small Government for you.

To really understand politics, it is necessary to discriminate between governments for special interests and governments for all (i.e., for “society,” hence the label “socialism,” which has nothing much to do with Cold War communism but just means that the goal is to aid society rather than one group). Some of the shrill voices warning about “socialism” (e.g., Palin) may not know this; many of them do and mean exactly what they say. They oppose policies that are good for society because they badly want policies that favor their little group.

To rephrase, “Big Government” is not necessarily “socialist” nor does Small Government necessarily equate with freedom. That $19B that the American taxpayer will never again see was the ultimate in Big Government but totally capitalist, in the robber baron sense of using government to steal from the masses. The Middle Ages in Europe were classic “Small Government” – if you had a horse and a sword, you could pretty much do whatever you wanted, including grabbing a peasant girl, making a private empire in the Levant, or setting up a private toll booth to tax merchants.

When “Big Government” stops Hitler or provides a large free trade zone (e.g, the whole United States), I love it. When it bails out millionaire gamblers or bombs pre-industrial societies to protect stolen oil (no, no, I was referring to Churchill in the early 1920s in Iraq), I beg to demur.

“Big Government” for society has indeed built the world’s greatest highway system in the U.S. It also created a public education system accessible to all (like the highway system). The education system is not very good, but that’s a detail: if you don’t like it, you are free to go to the library or sign on the Internet (both also brought to you—all of “you”–courtesy of Big Government) and educate yourself further. That’s a clue: Big Government that provides and/or regulates a safety net available to all but does not restrict individuals from pursuing higher goals is Good Government. Big Government that takes from the weak and gives to the strong is Bad Government. So, generally, is government – Big or Small – that constrains everyone to the official choices (e.g., the Soviet system of telling people what they could read). The distinction is between government for private gain vs. government for service.



The small word “regulation” is of course the elephant in the room of evaluating the quality of government. For one of many horror stories that is effectively being concealed from the American people about the way life is and the terrifying way it could be if government regulation were even worse, read up on the state of America’s nuclear plants.


Just for one example, today we in the U.S. (other pre-industrial and industrial societies made different choices) have a health care system designed for health industry profit, i.e., for private gain. It works brilliantly for that purpose. The point of health care reform is to design a system for service. A reformed health care service (as opposed to a health care industry) will, if ever designed, not make a profit. The public education system and the national highway system don’t make profits either. They are not supposed to; they exist to serve society. So should the health care system. It would not offer everything; “everything” is a pipedream. It would offer a safety net—details to be discussed, but for everyone. You are of course free to buy more health care just as you are free to buy a private plane or buy a book. How much “service” the government will provide is open to discussion; the concept of equal access to all is not open to discussion – not with a government designed to serve society.

Judging Government

Among all the cute phrases dreamed up by humans, perhaps “political science” is the most humorous. (I claim to be a political scientist, so I can say that.) I mean, you have to admit, there is precious little science guiding the actions of our leaders in regards to, say, the war in Afghanistan or health care or the regulation of Goldman Sachs. To be a little more polite, let’s say that “political science” is a goal. To bring us one step closer to that goal, which would presumably enable the creation of decent government, I propose the following simple metric for judging the quality of every official act by politicians:

Was their action on balance “for the elite” or “for the people?”

I am a political scientist; I can make the implementation of this simple heuristic as complex as you like. It can be arithmetic or really mathematical (e.g., based on calculus) or complex or graphical or philosophical. A nice little graduate seminar could be held on the merits of the various methods.

The point remains, however: if a politician does something that advances the interests of the society in general, that politician has done good; if it is just the elite that benefits, the politician has done bad. If you want good government, you need to be able to tell the difference, whether you are a political scientist or a barber…or even a TV news commentator.

Newsletter Giving Highlights of This Blog

Announcing: Newsletter Now Published

Governing for the People

This “behind-the-news letter” will summarize the key issues discussed in the Shadowed Forest blog in order to expose the real nature of government. The theme is judging the degree to which government is designed for the benefit of the elite or the people, a distinction that those doing the governing of course go to great lengths to conceal.