The Spotlight, a tabloid published by a group called Liberty Lobby, warned its readers that Communists, negroes, Jews, Catholics, immigrants—and the Federal Reserve—threatened the purity and wholesomeness and righteous authority of the United States of America. I encountered The Spotlight in a factory where I worked when I was a student. The factory owner had a box of the papers delivered each week, to which employees could help themselves.
Reading The Spotlight was my first exposure to what respectable folk and journalists call "conspiracy theory." To my mind the paper was a curiously crazy right-wing rag, alternately unintentionally disgusting and unintentionally comical. I was struck at the time by the commingling of attacks on the Federal Reserve with race baiting and anti-semitism. I wondered why these redneck hate mongers were paranoid about bankers.
As misguided as the editors of The Spotlight were about non-Whites, non-Protestants, and leftover hippies, they seem to have thrown their net wide enough to pull in some genuine threats, as we're seeing now — now that global financial markets are underwater, and the concentration of wealth in the hands of the few has accelerated off the charts, at least partially because of Fed policies. The Liberty Lobby, John Birchers and their kind have done the United States a double disservice. Fundamentalist populists not only have spread White supremacist bile and other sordid hate mail, but by associating scrutiny of the Federal Reserve and its privileged status with their xenophobic venom, they succeeded in casting a taint of kookiness onto any examination of the Fed's origins, operations and accountabilities. They helped insulate the Fed from proper public scrutiny. If I was a conspiracy theorist, I might suspect that the whole thing had been a plot from the beginning to set the Fed outside the bounds of normal journalistic investigation. (Liberty Lobby was put out of business in 2001 by a lawsuit related to accusations it printed regarding the Kennedy assassination. Good riddance, though it has come back in miniature, online.)
Whatever paranoid tendencies I have are stoked daily now that it's becoming clear how privileged the executive class is as it exists among the country's largest banks. There might be token wrist slappings here and there or a ceremonial condemnation of executive bonuses that amount to a sliver of the total bailout swindle, but by and large the people at the top of the Federal Reserve system of banks and associated financial institutions remain in place, collecting their generous compensation packages and wielding their vast influence to shake down the economy.
Those who occupy the financial stratosphere remain unfazed by elections. Political parties and candidates apparently function in their hands as disposable tools to be picked up or discarded at will. The elite executive class similarly is unfazed by markets, being compensated equally for performance and nonperformance. Doesn't a corporation's board of directors have a fiduciary responsibility to ensure that executive compensation is tied to performance, as in increasing shareholder value? That's a fine theory, but the executives choose the board, which in turn sets executive compensation. It's a clubby world at the top. I wish I could handpick the people who set my compensation. I might even signal to them my availability to join their boards and, you know, one hand washes the other. This mutual aid society for the financial elite, the system of interlocking directorates, ensures with rare exceptions that even when executives fail to deliver shareholder value (shares in the major U.S. banks now sell for pocket change), the responsible chieftains will remain ensconced.
And somewhere in the global financial mess, there must be fraud. No one would have purchased the toxic assets unless the value of those assets had been misrepresented. But will criminal charges be brought, will anyone besides expendable flunky scapegoats be prosecuted? There's been no indication so far. Besides, our laws of incorporation invent legal fictions, called corporations, to protect personal fortunes from corporate missteps. Talk about leverage.
The Crisis of Credit Visualized from Jonathan Jarvis on Vimeo
In short, the top-level, most connected bankers, even the deadbeats, are not subordinate to anyone. They occupy the top office of the control pyramid, despite the quaint reassurances that mass media spoon feed to the public about an elected government being in charge. More saccharin, yum, yum.
Untouched, unscathed, unruffled, a bemused Ben Bernanke, chairman of the Federal Reserve, the eye of the hurricane, surveys his bequeathed estate from sea to shining sea. He is a dictator answerable to NO ONE.
Given the inability of elections, laws, and markets to deliver a just system of accountability, what should be taught in civics classes today? That all that business about democracy, elections, the consent of the governed, the balance of powers, and all the rest of it is a bunch of fairy tales? Maybe. Weave those fantasies in with the mythic rivalry between capitalists and socialists and you've got a realistic curriculum for the current generation. Capitalism and socialism, those wacky kids, poking each other in the eye and calling each other names, a regular Punch and Judy sideshow:
"Am I a Democrat or a Republican? I'm both and neither. Never mind that man behind the curtain. Let my slapstick transfix you!"It's an obsolete rivalry, folks. OK, break it up and go home.
For one thing, a premise of the capitalist/socialist rivalry, that the public and private sectors are distinct entities, has evaporated. Freddie Mac and Fannie Mae, central players in the current debacle, are government owned corporations, mutant entities whose operations span the supposed gulf between the public and private sectors. And consider the revolving door that connects federal office holders with Wall Street board rooms and lobbying consultants. Same people, different letterhead. What about the privatizing of government functions? If I'm a peacekeeper in Kabul, what difference does it make if my paycheck says U.S. Army or Blackwater ? In either case the money is taken from the taxpayer and given to me, via the Pentagon. Where there is an intervening private contractor, it's just another layer in the bureaucracy, skimming salaries at taxpayer expense.
And don't forget about the venerable tradition of budgetary earmarks and pork that codify through legislation the transfer of public monies into private hands. Indeed, all government procurement networks redistribute wealth from taxpayers to private beneficiaries. Corporations lay off employees, who then collect unemployment from the government, which pays those benefits from monies pulled from private hands by taxation. And now we have the spectacle of Too Big To Fail (TBTF). The banking and auto industry bailouts, by eliminating the possibility of failure, pull the rug out from under capitalism. TBTF? There's a cure for that. It's called anti-trust.
Then there's the nuclear bomb of all public/private demolitons, the Federal Reserve.
The Fed is presented to the public as if it were an agency of the government, and most people probably believe that it is, but the Federal Reserve is a system of privately held banks whose shares are not available for purchase by the public but are held by a small clutch of elite shareholders.
Capitalist/Socialist? Don't bother. The public and private sectors of the economy are so intricately interwoven and intertwined and interdependent at this point that economic models based on some categorical distinction between the two sectors are just incoherent. "Public sector" and "private sector" are no more than tropes that radio talk jocks spew.
But how about Master/Slave? Now there's an economic distinction that remains meaningful.
When I was a youngster futurists populated my prospective adulthood with personal helicopters and lawn-mowing robots. The promise of technology was wealth and leisure for the masses, because machines would do the work. The technology arrived, right on schedule. Automation delivered the promised per-capita productivity improvement. So, given the new industrial efficiencies, where's the wealth and leisure for the masses? As Sarah Palin might say, "I ain't seein' it."
What was wrong with the crystal ball?
It apparently failed to account for something. That overlooked variable seems to have been the ability and willingness of the gilded class to redistribute wealth from our pockets to theirs, without guns or political revolutions, but simply by sucking pensions into the financial markets (the 401k swindle), then deregulating and manipulating those markets. At least Bush failed to suck in Social Security or that would have been wiped out too.
If it's time to restructure the economy, let me suggest that we go through a simple exercise and ask ourselves, "What should an economic system do?" The problem is that we (are encouraged to) confuse means and ends. An economic system should not be graded in terms of markets, taxes, profits, or other abstractions. The success or failure of the economy should be defined in terms of feeding, clothing, housing, and educating everybody. There's enough wealth to do it. If markets get the job done, great. If centralized planning does it, great. Those things are potential means. They possess no intrinsic merit. Their merit derives only from their results.
Moral of the story, getting back to The Spotlight: If you want to insulate your interests from criticism, get on the enemies list of some outspoken bigots. Getting lumped in with targets of bigotry will coat you in Teflon. "You're criticizing me? Look, those bigots are criticizing me too. You must be a kook like them." This tactic is glaringly evident in official attempts recently to link criticism of the Federal Reserve and criticism of globalism to "violent" "terrorist" groups. Only an enemy combatant would chant, "End the Fed"?
Fortunately, a new generation is growing up that, thanks to Ron Paul and others, effectively has decoupled the redneck mentality from a critique of the Federal Reserve and never internalized the taboo against questioning monetary policy along with fiscal policy.
Then again, if only the conspiracy theorists had praised to the hills the piety and patriotism of the Federal Reserve. Then we might not find ourselves becoming reduced to slavery, indebted financially to such vile masters as the plutocratic kleptomaniacal oligarchy that owns the presses that print the money.
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