Buffet and Lemann: two peas in pod

Jorge Lemann: won't eat what he produces

by Richard Mellor GED

Afscme local 444, retired

In a previous piece I commented on New York City’s mayor, Michael Bloomberg, having a certain worldview.  He believes that the city’s services and no doubt the existence of the city itself, is made possible through the financial generosity and sacrifice of billionaires like him.  In response to the accusation that NYC has become two cities, one for the rich and one for the poor under his governance, Bloomberg denies it and says, “if to some extent it is, it's one group paying for services for the other."  This reflects two separate and distinct views of the world based on class.

People like Bloomberg, Warren Buffet and their colleagues, are ruthless thugs really.  You cannot accumulate $27 or $45 billion dollars without being so, excepting a lottery win. They believe they are where they are because they are special; because they are smarter than those who get up and work for a wage all of our lives.  How can they not be smarter, they’re rich and don’t work.

Every ruling class justifies its rule this way and each member of the ruling class accepts that they are where they are through their hard work and diligence.  For the rest of us, just get off your butts and be prepared to take the risks.

But like all ruling classes, they are where they are through their control of the forces of production in society, something that overwhelmingly comes to them through family ties. Functioning as owners of society’s productive forces and wealth is a set up that their state, or what most workers call government, keeps in place through violence, and coercion.  Just look at that photo of the heavily armed police at that peaceful WalMart protest.  What are the police there to protect?  They are not there to ensure that the workers demands are met, that they get a better deal than starvation wages from the owners of WalMart who do no work yet posses more wealth than 90 million Americans. The police are there to defend the Walton family’s wealth.

These people have nothing in common with workers.  They may be Americans in name like us, or British, Japanese or South African.  On days like today, remembering the victims of the attack on the World Trade Center in 2001, they call for national unity; we are all together they claim. But they have a different view of the world.  This difference is greater than any religious, racial or national differences workers have between each other. Despite all the weaknesses and horrific things workers can resort to as society degenerates or as non-owners, we are far more collective creatures by nature of our daily existence in capitalist society.

I was reading in Bloomberg’s magazine, Business Week, about one of the 1%’s heroes.  Not Gates or Buffet, one of their heroes from abroad, a Brazilian.  His name is Jorge, Paulo Lemann; he’s also Swiss. Lemann is a coupon clipper that runs an outfit called 3G Capital. Lemann and his partners have been on a bit of a buying spree and now own H.J Heinz , Burger King, and Anheuser-Busch.  Burger King was once owned by another bunch of coupon clippers in a club called Cerberus that had the imbecile Dan Quayle on its board; the connection to established political families is a plus in the business world.

Lemann’s 3G and Buffet’s Berkshire Hathaway have equal stakes in Heinz despite Buffet putting up three times as much cash according to BW.  So Buffet trusts this guy. Not only that, Buffet refers to him as, “classy” and admits that Heinz will be, “Lemann’s show” according to BW. Buffet recognizes ruthlessness when he sees it.

Lemann has already proved to Buffet how “classy”he is firing 600 of Heinz’s office

Buffet with one of his employees

staff in the US and Canada, about 350 of them in Pittsburgh PA. And when they bought Burger King from Goldman Sachs, Bain Capital of Mitt Romney fame and a couple other coupon clipping outfits Lemann was even classier, ridding the firm of 28,000 employees, or putting it in business lexicon, shoving “…28,000 employees off Burger King’s balance sheet.”

Lemann brought in a former railroad executive to run Burger King, the man knew nothing about fast food, but that doesn’t matter as the food is not the object of this exercise. Whatever form of production the owners of capital choose to engage in, it is not the finished product as an object of consumption or use that they’re after, it is the surplus value contained in the commodity and realized in its exchange that matters. “What’s important is not knowing hamburgers, it’s knowing how to lead a company” says a former colleague; “It’s the kind of intelligence that transcends any specific business segment”. It’s about profits. 

Could Marx have been any clearer when he wrote:
“A schoolmaster is a productive laborer when, in addition to belaboring the heads of his scholars, he works like a horse to enrich the school proprietor. That the latter has laid out his capital in a teaching factory, instead of in a sausage factory, does not alter the relation.”

Yep, Jorge is a real hero.  He surfs, (30 foot waves says BW) plays tennis even playing in a Wimbledon event.  In fact, Jorge admits that it wasn’t the things he learned at Harvard that gave him, “…a certain confidence when it came to taking risks.” It was that 30-foot wave he surfed in Copacabana. It all comes down to be prepared to take risks, take a chance.  If you’re bold enough to take a chance you can become rich and famous like Jorge and others like him.  The more than $30 million his dad left him wasn’t what got Trump started of course, and that Lemann’s Swiss father was a dairy entrepreneur didn’t give him a certain confidence, a willingness to take a risk someone without that sort of backing might pass on. When you fail, as George W. Bush did in most of his ventures, the moneyed interests, family or friends are there to rescue you.  Who won’t take risks with that backing? They’re not risks at all.

Lemann went to the American School of Rio de Janeiro.  This school is an institution designed to develop and strengthen Brazilian capitalism and its ties to US corporate interests.  Its creation was made possible by funding from the U.S. Department of State, the Ford Foundation, private individuals, corporations, and the American Chamber of Commerce. So Jorge is not just an ordinary guy who pulled himself up by his bootstraps.  He’s not a self made man, there’s no such thing. Everyone has help and people like Lemann have the most help, the most handouts, have all the connections in the right places.

Jorge Lemann places money above all things, not in the same way as workers do, to pay the rent or mortgage or feed the family or for that little extra cash for pleasure.  People like Lemann seek to accumulate capital, live through the profit of capital as opposed to productive labor.  He places the accumulation of money above social needs. This is why Warren Buffet and Sam Walton, the retail outlet’s founder, gave him an audience.  Lemann subscribes to hatchet man Jack Welch’s business philosophy, the 20-70-10 rule on how to deal with employees, “Promote 20 percent…maintain the middle 70, and fire the rest.”  A simple thing really.

Lemann may be a capitalist involved in the production of food and beverages, an important aspect of productive life for human society.  But he doesn’t eat the stuff he produces. He ate a Burger King hamburger once and wasn’t impressed.  “What he liked about Burger King was how it generated cash.”,  He admires the Goldman Sachs model as well, “Innovations that create value are useful” is one of the favorite maxims.  We must be clear that by “value” capitalists mean surplus value, the value created above that paid out for wages, value for which the capitalist gives nothing in return and that is the source of their profits: “People say that the customer comes first and all that”, says Vincent Falconi, a management consultant hired by Lemann when he owned the Brazilian beer company AmBev that provided the seed money for the purchase of AB InBev “but actually it’s cash”

And cash flowed in to InBev which sells one in every five beers in the world according to BW.  But most of it went in to Lemann and his partner’s bank accounts.  This no doubt helped replenish the $6.4 million Lemann and his partners were fined by the Brazilian regulators for crooked dealings at AmBev.

According to Business Week, Heinz is different as there is “less fat to trim”, so “How then, to wring more value from Heinz” is the question Business Week poses. As workers we know about how bosses “squeeze”more value from a company only too well; how they “trim the fat.” We experience it in the unemployment line, longer hours for those that don’t get laid off, less pay, increased pace of work as job cuts mean fewer hands doing more.

So far production, jobs at Heinz are still intact, but “workers are nervous” says one Union official, and so they should be.  This perpetual insecurity and fear is another cause of stress and the by-products of it, poor health, family break ups, drug and alcohol abuse and domestic violence. Waiting to be fired is not freedom. But that’s the market.  The Union official has no alternative to the waiting, or the unemployment that follows “fat trimming”. Fighting back, taking the production of society’s necessities out of the hands of the Jorge Lemann’s of this world is not something they consider.

Maybe I’m being a bit selfish here because writing about this is a sort of catharsis for me. It keeps me on my political toes, reminding me (and hopefully some who read it) of how the world really works and how absurd it is that the production of a social necessity like food is in the hands of private individuals and that production is set in to motion only if profit accrues to the owners of capital like Lemann, the moneylenders and other coupon clippers. It reminds me of who my enemies really are.

Lemann could have, as the quote from Marx stated above, invested his capital in condom production or a mining concern, it matters not to these people.  What matters is the end result, more money coming out of the process than went in.

A friend I talk to about these things worried that to take these important social functions out of the hands of private individuals would mean a bloodbath, that we will deny them life itself.  That is not necessarily so. It has not been workers that initiated violence in the historical struggle for some control over our lives at work and the respect and dignity that comes with it.  It has been the bosses and their government that resorted to violence, who hired gun thugs and entire armies to keep working people down.  The violence against strikers; the black folks who fought to eliminate Jim Crow and the apartheid south, and all Americans who fought for equality was always initiated by the state and its agents.

The Jorge Lemann’s , Warren Buffets and Donald Trumps of this word are all welcome as productive contributors in the society so many activists are fighting to build.  They just aren’t going to continue to live off the labor, poverty and misery of the vast majority of humanity.

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Starvation, poverty and disease are market driven.

by Richard Mellor
Afscme Local 444, retired

What a tragedy. A beautiful little boy who should be experiencing all the pleasures that a healthy and well fed young life can offer. I can barely look at it without wanting to take him in my arms and caress the little man; hold him like I have my own little ones, or the way we hold our pets.  A mother or father whose kisses and hugs bring such joy to the recipient and the giver is waiting for that moment when starvation and lack of water, ensures he breathes his last breath. It's not a nice death is it?  Look at the body and the physical pain it brings to the child and the emotional pain to the adult, herself, not far from death's door. 

The scene in the picture is indeed horrific. It is heart wrenching, sad, makes us angry and makes us want to cry at the same time.  But let's get something clear in our heads. What we see in the picture, a starving boy being given water by his equally deprived mother, or female guardian, is not something that occurs because of a lack of resources or money.  The condition prevails not because people in that particular part of the world are lazy or stupid or can't govern themselves.  It is not as some might argue, god's wrath, or the devil's work or the work of any supernatural beings or ghostly demons. It is not because of overpopulation or that there's too many people on the planet.

This young boy will die of starvation amid plenty.   He will die of diseases that were cured long ago.  The cause of these events is political and economic.  Society has infrastructure and that infrastructure is put in place by directing capital and labor power to do so.  The trillion or two the US has spent in Iraq would solve world hunger, would eliminate what we see here forever.

The infant mortality, disease and starvation that engulf millions of people in this world is a product of the market, of capitalism.  The communities in which these people live have little public infrastructure, no water system, no sewage system and instead unsafe water and sewage flows openly in the streets if at all. There is no medical and health care system in place. Diet is poor and shelter is inadequate. The money is there to remedy this.  But the owners of capital, capitalists as the Wall Street Journal calls them as opposed to many anti-capitalists who choose words like corpocracy, plutocracy, meritocracy, oligarchy and other terms to avoid calling them what they are, will not allocate capital to buy labor power and the necessary materials necessary to end this savagery.

According to Global Issues:
10.6 million children died in 2003 before they reached the age of 5 (same as children population in France, Germany, Greece and Italy

1.4 million die each year from lack of access to safe drinking water and adequate sanitation

The money is there to change this:
A conservative estimate for 2010 finds that at least a third of all private financial wealth, and nearly half of all offshore wealth, is now owned by world’s richest 91,000 people – just 0.001% of the world’s population.

The world’s billionaires — just 497 people (approximately 0.000008% of the world’s population) — were worth $3.5 trillion (over 7% of world GDP).

The world spent close to $2 trillion on military hardware in 2012 with the bulk of that coming from the US, the worlds largest arms dealer by far. Corporations are hoarding trillions, private capitalists have stashed away some $26 trillion or more in offshore tax havens. Poverty and most disease can be eliminated, but capitalism cannot do it; it is the cause of it.

The US president Obama, Hilary Clinton and all the other representatives of wall Street and the system that perpetuates the misery we see in the graphic, are prepared to bomb Syria because of the deaths of less than 2000 people.  But the policies that these people institute and defend to the teeth kill millions of children and adults yearly; their deaths are not accidents, they are the product of conscious decisions by human beings.

These conditions and the endless wars that we currently see begun by primarily by the US government  cannot be eradicated under the present economic system we know as capitalism.  It is not simply that they cannot be eradicated in what is often called the developing world, they are on the increase in the advanced capitalist countries also. As an earlier blog pointed out, the cost of making the world safe for US corporations is not only causing untold environmental damage and misery for the world's populations, it is also driving US workers further in to poverty and debt.  Even the US troops are facing cuts to necessary services.  This will hasten the crisis in the US military much like the crisis that occurred during the imperialist war against Vietnam.

It is pointless feeling guilty about having a better life than the woman and her child in the picture.  We are not individually responsible for it and guilt is a pointless emotion that accomplishes little.  We can collectively end it though.   I was talking to a group of young men the other night, they were all well educated and relatively financially secure. They had good jobs but when it came to understanding the forces at play in society and what was going on in the world around them, especially US capitalism's role in it, they were clueless and actually accepted that they were oblivious to much of what is going on.  This is nothing to be proud of even though, the forces against us in the US are considerable as we are faced day in day out with an ideological  offensive from the 1% about the merits of their system and how there's opportunity for all if we take the bull by the horns.

Throughout the world,  workers are fighting back against the capitalist offensive.  Working class women that fill the factories of Bangladesh have waged street battles against factory owners and their hired thugs.  Chinese workers have struck foreign multinationals for higher wages and better conditions and won raises of as much as $20% and this is without independent unions.
Indigenous people throughout Latin America, India, Indonesia and the entire world are leading the struggle against the environmental devastation caused by the energy giants and mining companies.

Greek workers, Portuguese workers, women and gays in Russia, are all refusing to be cowed by the worshipers of the market. And we saw the rise of the Occupy Movement in the US that challenged the repressive laws of the 1% and battled the new beefed up security apparatus built in anticipation of the resistance that will occur to the increased offensive of capital.

And here in the US, we should not underestimate the developments that have occurred around Obama's eagerness to bomb Syria.  The outpouring of opposition has been intense and this has caused the 1%'s representatives in Congress to push back against Obama's war drive.  In a twist of irony, it looks like old Putin might have thrown Obama a lifeline brokering a deal with Syria's Assad to have the UN take charge of that country's chemical weapons stash.

This development is very positive and when we consider the ongoing global resistance to the capitalist offensive we should be inspired and optimistic about it.  But we must take the bull by the horns, we must accept firstly in our own consciousness that the present state of affairs will eventually lead to the end of life as we know it, market driven wars and environmental catastrophe all in the pursuit of profits will ensure it. We must recognize that the most destabilizing force in society today and the reason for much of world poverty is US capitalism.  American's cannot find a solution to our problems within the borders of our own nation state.  The solution to the starvation we see in the graphic, the endless wars and driving back our own 1%'s austerity agenda lies in the building of a global movement.  Capitalism is global and the fight against it's destructive effects must be global.

Replacing an economic system of production where a tiny minority of individuals own the means by which we produce the necessities of life and who set these forces in motion only for personal gain, is our goal.  Capitalism is an anarchistic unplanned system of production, it cannot advance humanity.  It is, as we say here, past its expiration date.  Only a democratic socialist economy and political system can solve the crises that capitalism creates.

A couple of things to remember:
The Soviet union was not a socialist or communist society.
Socialism is not a utopian idea it's just a different way of constructing human society
Sweden, Finland or a national health service is not socialism or communism
Obama is not a socialist (for my American brothers and sisters only)
Capitalism overthrew feudalism and socialized production
Socialism will take it one step further and socialize ownership of the process of production, distribution and exchange. It brings economic democracy.

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The debate on the causes of the Great Recession

Mick Brooks comments here on the debate within the Committee For a Workers' International on the causes of the Great Recession and capitalist crisis. Check out a review or order Mick Brooks' book here .

by Mick Brooks

Since the outbreak of the Great Recession Marxists have debated its cause. This is a vital theoretical issue for understanding the world around us.

The debate centres around the issue as to whether the present crisis is caused by falling profits as explained by Marx’s law of the tendential fall in the rate of profit (LTFRP), dealt with in chapters 13-15 of ‘Capital Volume III’. Others argue that the crisis can be explained as one of underconsumption.

This debate is bubbling under within the ranks of the CWI. The leadership of the CWI (as of the IMT) take what I would characterise as an underconsumptionist position. Already two blogs are circulating inside the ranks of the CWI that advocate the LTFRP explanation, in addition to an excellent short film, and debates are beginning to take place in the localities. Signs of intelligent life? It looks like it. Check out:

Marx returns from the Grave, http://69.195.124.91/~brucieba/ 

Socialism is Crucial, http://socialismiscrucial.wordpress.com/

It should be explained at the outset that all parties agree that a crisis of capitalism takes the form of overproduction, of unsold goods, as it says in the ‘Communist Manifesto’. Overproduction and crisis, however, are not permanent features of capitalist production. It remains to be explained why capitalism dips into crisis when it does.

The leadership, reacting to criticism, has resorted to an ‘underconsumptionist’ explanation of the cause of crisis. The crisis is caused, according to a quote from Chapter 30 of ‘Capital Volume III’ by “the poverty and restricted consumption of the masses.” (As one of the bloggers, CrucialSteve, points out this was actually a bracketed note added by Engels into the original text.)

The problem with the underconsumptionist explanation is that there is a permanent tendency for capitalism to restrict the purchasing power of the working class, because it is a system based on profit. Underconsumptionism therefore has no explanatory power as an explanation of crisis.

In any case not all commodities are produced for workers – pallet trucks and computer numerically controlled machine tools are capital goods bought by capitalists. There are also luxury goods consumed only by capitalists such as yachts and private jets. Why should there be a specific outbreak of overproduction of consumer goods intended for workers’ consumption such as jumpers rather than pallet trucks or yachts? Empirically crises of overproduction usually break out in the capital goods industries. Investment is the most volatile element in national income.

The opposition bloggers within the CWI have a powerful argument in their favour – the rate and mass of profit in the major capitalist countries fell sharply prior to the onset of crisis in 2007. Marx’s theory is confirmed! To take the case of the USA:

“The US Bureau of Economic Analysis (BEA) shows that in the 3rd quarter of 2006 the mass of profits peaked at $1,865bn. By the 4th quarter of 2008 it bottomed out at $861bn.” (Brooks – Capitalist crisis; theory and practice, p.32)

The facts confirm Marx’s analysis of the LTFRP as the fundamental cause of crisis. Why should this cause surprise, since we all agree that capitalism is a system of production of profit?

The school of Marxian economists who support this analysis view the falling rate and also mass of profit only as an underlyingcause of crisis. Essentially the argument is about levels of causation in the crisis. What about the financial aspect of the crisis – the housing bubble, crazy loans and collapsing banks? Of course this was all very important. These specific factors profoundly influence the depth and nature of the downturn. Every crisis is a unique event with its own characteristics. But, with or without a ‘financial crisis’ the fact that the mass of profits in the USA, the most important capitalist country, halved over two years would have provoked a big collapse of output in any case.

How does the leadership of the CWI deal with the detailed criticisms of their approach thrown up by the advocates of the importance of the LTFRP as an explanation of crisis? Lynn Walsh argues in ‘Socialism Today’ that profit and investment have become disconnected in recent decades. “Despite the staggering increase in the share of income taken by the top 1% in the US, investment declined.”(‘Socialism Today’, November 2012) So profits (with the share of the top 1% as a proxy) are supposed have soared at the expense of working people, but this has not translated into productive investment. Walsh concludes, “This factual data..., in our view confirms the analysis of a crisis in capital accumulation put forward in ‘Socialism Today’ over many years” (ibid.).

If true, this is not an explanation for a pattern of booms and slumps. It presents a stagnationist perspective for the future of capitalism, a permanent slowing down of the rate of accumulation. Is the CWI serious about decades of stagnation? How do they explain the present crisis, where investment fell as a result of the fall in profits?

In fact there is a simple explanation for this alleged disjunction between profits and investment: the profit figures quoted are wrong. Michael Roberts has meticulously chronicled the rate of profit since the Second World War in his blog. Nobody has challenged his figures, which attempt to look beneath conventional statistics to work out a Marxian rate of profit.

Roberts concludes: first that there has been no return to the fabulous profits enjoyed by capitalists during the golden years of the post-War boom; and secondly that the rate of profit today in 2013 remains below that of 2007 before the onset of the great Recession. Andrew Kliman also carefully shows (in ‘The failure of capitalist production’) that the reason for lower investment in the years since 1974 is lower profits. There is just less to invest. Simples.

The CWI leadership buttress their ‘explanation’ as to why investment has been lower with recourse to the notion of financialisation. As Lynn Walsh argues in the same article, more and more funds have been gobbled up by financial shenanigans in preference to investing in industry. There is no mystery here. In so far as more “profits disappeared into the financial sector” (ibid.), that is a response to lower pickings to be made in production – because of the LTFRP itself.

Increasing exploitation of the workers over recent decades has not led to increasing rates of accumulation because of financialisation, it is asserted.  This is part of the analysis of a whole school of thought, regarding itself as Marxian, which sees the current crisis as one of the neoliberal form of capitalism rather than capitalism as a whole. In fact this is the conventional wisdom of the majority of academic Marxist economists. A whole new stage of capitalism is supposed to have developed since about 1980, buttressed by the holy trinity of globalisation, neoliberalism and financialisation.

Dumenil and Levy’s book – ‘The crisis of neoliberalism’, 2011 – is an example. Phil Hearse writing in Socialist Resistance, the publishing house of the so-called Fourth international, also refers to “a neoliberal ‘regime of accumulation’”. The logic of this approach seems to be that neoliberalism should be destroyed rather the capitalist system overthrown. 

As we see, the CWI leadership has swallowed this analysis whole. By accepting the interpretation of this school the CWI is on a slippery slope indeed. We’re with the opposition within their ranks on this one.

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Labor, value and capitalist production

by Richard Mellor
Afscme Local 444, retired

If we ask workers, or even capitalists where profit comes from, the answer generally is that it comes from selling the product that the particular industry makes above its cost of production. But this is not so.  Profit is made not by selling a product higher than the cost of making it it but in the labor process itself.  The capitalist sells the commodity the worker makes for more than the capital he or she put out in the labor process, the capital for machinery, plant etc along with wages or the price of labor power. But the added value is present in the commodity itself prior to sale, it is merely realized or set free through the sale which is why we live in a 24 hour marketplace and the imbecile Bush urged us to "go shopping" after 911.

This added value contained within the commodity and realized in the sale has its origin in the labor process because the worker produces a certain amount of money value in the labor process (with the assistance of the means of production that the capitalist owns) but in return receives money (wages) that equals only a portion of the value the worker produces.  If the workers produce the value (let's say shoes) of their wages in 6 hours for example, the capitalist doesn't send them home. What would be in it for them?  So while it appears because we are paid a wage, that we receive 8 hours pay for the value we produce in 8 hours work, we are only paid for part of this working time. The value (again, shoes for example) that we produce beyond this we receive nothing for. It is an unequal exchange, the owner of capital receives value or a finished commodity that contains labor power they paid for and labor power they didn't.  This unpaid labor power is the source of profit and Marx called it surplus value.

I am not an economist but this view of the world makes absolute sense to me and explains concretely how workers are exploited in what we call capitalist society; it corresponds to objective reality as I see it.  But what got me to thinking about this was an ad I just saw on TV.  This ad started off stating something like how can an idea become reality "without the capital to make it happen?". I agree with that statement incidentally and understanding exactly what "capital" is, is another task for workers who want to understand how the world actually works.

Then there was another ad that immediately followed it saying the same thing about a "vision" how a vision can become concrete or a real.  A vision can only become reality with "financing" the ad tells us. The ad is right, capital, money or financing is absolutely necessary to make ideas real. 

But in both these cases there is another vital aspect missing and that is human labor power or labor as most people would say.  It is as if this function doesn't exist.  Someone has an idea, another has money and presto, you have society.  But as I explain above, labor is the source of profit and therefore all value creation or wealth.  The short term payroll loan that the capitalist takes out from the banker is simply a reserve capital, the product of labor power past.  It is a collective product.

Not only was human labor missing in these ads, it reminded me of when I hired a guy to do some work on my old house before I sold it. He gave me the contract to sign and I noticed that at the end he had a percentage under the heading "profit". Nowhere was there a column or a mention of the unpaid labor of the workers he employed although his payment for labor power was there, the hourly rate he paid his painters but naturally, there was no mention that he paid them less in wages than the value they create through their labor power.

So at least, labor was in existence in this example but profit again, or its source is not defined.

Someone, I can't remember who, once said that the system works behind the back of society, even the capitalists if you ask them do not really think it through.  They attribute bubbles and excess simply to "animal spirits" or claim "crony capitalism" the culprit whatever that means. They refuse to recognize that these occurrences are an inherent aspect of this system of production, of capitalism and its many contradictions.

As a wage worker all of my life, even before I became political or was introduced to socialist and/or Marxist ideas I used to get mad when I would read or hear something  like, Donald Trump or Howard Hughes built this or that hotel or resort.  "No they didn't" I would say to myself angrily.  Welders, iron workers, laborers, bricklayers, painters, plasterers, carpenters, they built that resort.  Waiters, servers, cleaners, maids, bartenders accountants and other workers operated it, made it function.

Capitalism is an exploitative system, we know this in our gut, but it's a bit harder to see that in a wage system where we are told we are paid 8 hours pay for 8 hours work which is not possible, than in feudal society for example where the exploitation was much clearer as the surplus was given in kind.  The serf would see the product, food for example,  of two or three days labor be handed over to the feudal lord not to mention tithes and rights the lord had like sleeping with your bride on her wedding night.

For the feudal aristocracy the peasant was there to serve their interests, they were the rightful owners of the land and everything on it bar the commons and their wealth came from the peasant's labor.  The capitalists view wage workers in the same way; it doesn't even exist in the creation of things.  All is needed is an idea and some money.

Without production there is no life and without labor there is no production.

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Capitalism = Mental Illness = Profits

by Richard Mellor
Afscme local 444, retired

America is not known as a human friendly society.   It is money friendly, but that doesn’t mean human friendly. It is an extremely fast paced society that will leave you behind very quickly.  It doesn’t matter if you are a war hero, a Vietnam veteran, have worked steadily all your life contributing to the wealth of society---if you have no money in this country, you’re on your own baby,

A friend from Sweden who had spent considerable time here described the difference between the two societies this way: “In Sweden, if you fall on hard times there is this safety net that catches you, prevents you from falling all the way to the bottom.  In the US, not only do fall all the way to the bottom, then they stomp on you with their feet.” He showed by example twisting his heel in the dirt like he was stubbing out a lit cigarette. You can be homeless, broke, go from what appears to be a comfortable middle class life in short notice. Whatever you do, don’t get sick. Ion many ways, we get the worst bang for the buck when it comes to public and social services.

We are not a happy society. It is a stressful existence the rat race, and as public services and jobs, which tend to be somewhat more humane are privatized, the insecurity and fear of losing everything will intensify.

A recent Gallup Poll found that 70% of Americans hate their jobs Bruce Levine writes at AlterNet pointing out that US society “…has become increasingly alienating, isolating and insane, and earning a buck means more degrees, compliance, ass-kissing, shit-eating, and inauthenticity.” And this has resulted in a huge increase in mental illness; what he refers to as an “epidemic”.

Levine quotes Marcia Angell who wrote a piece in the New York Review of Books:

“The tally of those who are so disabled by mental disorders that they qualify for Supplemental Security Income (SSI) or Social Security Disability Insurance (SSDI) increased nearly two and a half times between 1987 and 2007—from 1 in 184 Americans to 1 in 76. For children, the rise is even more startling—a thirty-five-fold increase in the same two decades.”

And here’s another interesting statistic:

In 2011, the  U.S. Centers for Disease Control and Prevention (CDC) reported that antidepressant use in the United States has increased nearly 400% in the last two decades, making antidepressants the most frequently used class of medications by Americans ages 18-44 years. By 2008, 23% of women ages 40–59 years were taking antidepressants.

The CDC, on May 3, 2013, reportedthat the suicide rate among Americans ages 35–64 years increased 28.4% between 1999 and 2010 (from 13.7 suicides per 100,000 population in 1999 to 17.6 per 100,000 in 2010).

  

This should come as no surprise given the insecurity and ever-present fear of falling through the cracks wears people down.  The intense ideological war aimed at convincing Americans that life is what you make it, that the rich all pulled themselves up by their own bootstraps and that the individual is in control of their own destiny has a very powerful influence on thinking.  Day in day out we are bombarded with ads in the media selling us something, more than any other country in the world we live in a twenty four hour marketplace.  My mother used to complain about paying for a TV back home until she got a taste of US TV, 200 channels, nothing to watch.  Ads every three or four minutes during late night movies and sometimes the same ad repeated. How insulting.  It’s not that Americans have gotten used to it. We kid ourselves that it doesn’t affect us, that we just ignore it. But it does, it contributes to the alienation that exists in US society although there is a strong urge to deny it. If one believes one can get what one wants in society, it’s up to you and you alone, when you fail, you blame yourself with devastating consequences.

As I have pointed out before, another major factor is the view that there’s nothing we can do about it.  “It is what it is” is a common phrase or “You can’t change city hall”and similar resignations.  There is reason for this as there has not been a mass movement in this country for years.  The Occupy Movement received tremendous support from many layers of society but didn’t know what to do with it. The trade Union leaders are pretty much absent form people’s lives and if given any thought at all are distrusted, even hated, down there with Congress when it comes to popularity contests.

There is nothing worse than victimhood.  We all know the feeling when we stand up to a bully or our abusers even if it costs us a black eye.  But US workers have seen wages, benefits and working conditions that took decades to win stripped from us by the capitalist offensive. We have lost homes, jobs and witnessed increased surveillance and interference in our private lives as the TV blasts out 24 hours a day messages contradicting this objective reality adding to our frustration.  We can’t travel to half the countries of the world because of the actions of our government murdering and slaughtering people from Pakistan to Yemen and if not directly involved in such practices, supporting ruthless dictators who do their dirty work for them.

There is no significant objective force in US society that the masses feel they can turn to. As I have pointed out, the heads of the Labor Movement with 12 million members, a huge budget and full time staff not to mention physical structures, could transform this situation but instead appeal to the very politicians whose policies are at the root of this crisis.  In the absence of a real mass movement that can challenge the offensive of capital, drive it back and organize an offensive of our own, millions of Americans simply bury their heads in the sand, party themselves to death or escape in to mental oblivion to avoid the pain.  But inequality is on the rise, the bosses will not stop in their efforts to place the US workers and middle class on rations and at some point the eruption will come. It will be messy and confused and contradictory but come it will.

You can read Levine’s piece here.“Why Life in America Can Literally Drive You Insane”

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Global capitalism: The global search for value

by Michael Roberts

In my view, we are now in a Long Depression, centred in the advanced capitalist economies but also affecting the emerging capitalist economies.  The latter do better because they still have ample supplies of cheap labour available to exploit (well, at least some larger emerging economies do).   So absolute surplus value can be increased without Marx’s law of profitability applying too strongly.  What do I mean by that?

Well, capitalists are permanently engaged in the search for value, or more specifically, surplus value.  They can get that globally by drawing more of the population into capitalist production. The big issue is how much longer capitalism can continue to appropriate value from human labour power when the workforce globally can no longer expand sufficiently.

Ironically, the UK’s right-wing City paper City Am put it from the perspective of capital: “People, not commodities, land or even capital, are the ultimate resource of an economy, as the US academic Julian Simon famously put it. Without talented, motivated, skilled and educated individuals, nothing is possible; capital itself is a product of labour.  Human ingenuity is able to overcome everything. Malthusians who dream of a shrinking population and who reflexively believe that every country is over-populated are wrong. This is always a lesson that nations suffering from shrinking populations relearn at great cost: all the productivity growth in the world is rarely enough to compensate for the psychological and actual effect of a declining population.”

More important, more people means more potential value to be appropriated by capital.  But getting more value and surplus value through extending the size of the workforce is increasingly difficult or even impossible in many advanced capitalist economies.

Instead, in these economies, capitalists must try and raise surplus value though the intensity of work and through more mechanisation and technology that saves labour i.e relative surplus value.  But that, as Marx explained, brings into operation the law of the tendency of the rate of profit to fall and the ultimate barrier to further accumulation and growth in value (see my post on http://thenextrecession.wordpress.com/2012/09/12/crisis-or-breakdown/).

Indeed the crisis in the south of the Eurozone is creating permanent damage to these economies: it is not just that their GDPs are shrinking, but there is an exodus of the workforce. The number of Greek and Spanish residents moving to other EU countries has doubled since 2007, reaching 39,000 and 72,000 respectively in 2011, according to new figures on immigration published by the OECD.  In contrast, Germany saw a 73% cent increase in Greek immigrants between 2011 and 2012, almost 50% for Spanish and Portuguese and 35% for Italians.

Japan is also suffering from the lack of expansion of its workforce.  In the short term GDP per capita growth in Japan looks better than its GDP growth so that US GDP per capita growth in recent years is little better than Japan.  Indeed on a per capita basis, the US has been stagnant since 2008 and Japan has risen slightly.

But longer term, this is bad news for Japan as its debt burden will mount and its working population to dependents will decline.  This is a growth and debt time bomb.  The move to crisis may be slow because Japan has huge reserves of FX reserves and foreign assets built up over decades so it has lots of funds to fall back on.  Japan’s net international investment position is 56% in the positive while the US is 19% in the negative.  Also its debt is mostly owned by its own citizens (only 7% by foreigners) while US government debt is 40% owned by foreigners.  However, the US dollar is still the world’s reserve currency, giving the US considerable leeway in funding its deficits and debt.  Japan’s banks and government are so intertwined that they will both go down together.  In the 1990s, the banks were bailed out by government; currently the banks are bailing out the government.  Next time, they both go down together.

George Magnus (Economic insights by George Magnus, 19 June, Demographics: from dividend to drag) recently pointed out that the support ratio in the US and Europe in the early 2000s was similar to that of Japan ten years earlier. It shows that from about  2016, the decline in China’s support ratio starts to speed up, so that by 2050, it will have fewer workers per older citizen than the US. It also includes India, by way of comparison, as the representative of the bulk of emerging markets and developing countries. India’s support ratio is predicted to grind lower but even by 2050, it will still be only the same as that in Western countries in the 1990s.  From the 1960s onwards – a little earlier in Japan – the total support ratio rose everywhere and more or less continuously, until about 1990 in Japan, and 2005-2010 in the US and Europe.  Japan’s support ratio is now approaching 1.5 workers per older citizen, and is predicted to carry on falling to parity in the middle of the century. The US and Europe are predicted to follow Japan, though support ratios are not expected to fall as far.

China and other emerging economies have not yet reached the point where the working population is no longer rising and the expansion of absolute surplus value is restricted – the so-called Lewis turning point (see my post, http://thenextrecession.wordpress.com/2012/11/16/chinas-transition-new-leaders-old-policies/).  But China is not far away.  In the meantime, China is pushing ahead with a sweeping plan to move 250 million rural residents into newly constructed towns and cities over the next dozen years — a massive of expansion of labour power into production.  The broad trend began decades ago. In the early 1980s, about 80% of Chinese lived in the countryside but only 47% today, plus an additional 17% that works in cities but is classified as rural.

And there are still huge reserves of labour as yet untapped, particularly in Africa.  The latest UN population projections for the world’s economies show that Africa is expected to dominate population growth over the next 90 years as populations in many of the world’s developed economies and China shrink.  Africa’s population is expected to more than quadruple over just 90 years,  while Asia will continue to grow, but peak about 50 years from now then start declining.  Europe will continue to shrink. South America’s population will rise until about 2050, at which point it will begin its own gradual population decline. North America will continue to grow at a slow, sustainable rate, surpassing South America’s overall population around 2070. 

China’s population is soon expected to go into decline , whereas India’s is expected to grow strongly for another 50 years, and the US’ and Indonesia’s populations are projected to grow steadily. Nigeria’s population is expected to explode eight-fold this century.

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US society: the calm before the storm?

Occupy Oakland shuts down the docks

by Richard Mellor

Afscme Local 444, retired

The Russian revolutionary, Leon Trotsky, wrote on the eve of the second world war that The historical crisis of mankind is reduced to the crisis of the revolutionary leadership.  He explained that the objective conditions and the prerequisites for a workers’ revolution were not only ripe for a transformation of society but were “somewhat rotten.”

He used an often quoted phrase that humanity was faced with Socialism or Barbarism. The Barbarism came on the scene soon after his statements as 50 million or so people died in the war that that followed, as many as 12 million in death camps. Communists, labor leaders, the physically and mentally disabled, gays and lesbians, Romany and as many as 6 million Jews all perished in places like Treblinka, Aushwitz, and Bergen Belsen.

Today, we are not simply faced with socialism or some form of barbarism, as barbarism exists aplenty in the capitalist horror that encompasses most people of the world.  From the factories of Bangladesh to the plantations of Indonesia, sweat shops of Cambodia, and mountains of Afghanistan barbarism is the norm, the legacy of capitalism in its slow and agonizing demise.  The difference is that what faces us now is socialism or annihilation. While nuclear war cannot be ruled out it is the environmental degradation, the plundering of the world’s natural resources in capitalism’s rapacious quest for profits that threatens to end life on this planet as we know it. The environmental catastrophe, overwhelmingly market driven like starvation and conflict is real and capitalism is incapable of solving it.

In the US, the richest and most powerful economy on the planet, inequality and poverty are on the increase and despair and a sense of foreboding exists.  The Great Recession is dragging on longer than the so-called experts expected and the insecurity and fear of falling through the cracks, so useful in keeping folks in check, hovers around unacceptable levels, a point where a spark can ignite a conflagration.

Objective conditions are worsening for American workers and the middle class.  Once powerful unions like the UAW have been tamed through a powerful combination of the employers and the top leadership of the worker’s organizations who see no alternative to capitalism and try time and again to help it to its feet at the expense of workers and the middle class.

Results of a Wall Street Journal/NBC poll released today give us a glimpse in to the mood in US society when it comes to the economy and the two capitalist parties.

As expected, the love affair with Barack Obama is not what it was as he has turned out to be quite the war president and a fine representative of the 1%.  83% of Americans disapprove of Congress which is the highest number in the history of WSJ polling and 29% of Americans say the country is headed in the right direction.

When it comes to their own representatives in Congress, a mere 32% of Americans say their representative deserved re-election with 57% of Americans saying they would like to defeat and “..replace every member of Congress if they could”the WSJ adds. There’s “..a strong, deep disconnect between the public and the government that purports to serve them” Fred Yang, a Democratic pollster tells the Journal.  It is not the mood for change that is missing.

The criminal acquittal of George Zimmerman has dealt a significant blow to how the black population sees this country and 54% of them polled said they “strongly disagreed” with the idea that America is a country that judges people on their character and not the color of their skin, 30% of them felt that way after Obama’s election. When those who “somewhat disagreed” are included, that figure jumps to 79%. 

Further on the effects of the trial, the Wall Street Journal/NBC poll found that 33% of Americans had lost confidence in the US justice system because of it, 24% of them whites and 71% of blacks. This figure is far more reflective of a racist justice system than the details and ins and outs of the legality of an individual case like Trayvon Martin’s murder. Whites are treated differently in this that system. Obviously, those with money are treated the best of all and can get away with murder quite frequently---Zimmerman is the son of a judge and we are supposed to think that this doesn’t matter in America. But with more than two million people incarcerated, close to 50% of them black folks, there are only two explanations for this incarceration rate. 

One is to argue that people with darker skin are more prone to criminal activity which is the racist argument which many whites believe but refuse to acknowledge openly. The other is that the justice system, indeed, the entire system is racist---the latter is the only correct answer, the only answer that offers all workers a future.

The Wall Street Journal is the main publication of US finance capital and the capitalist class as a whole and bases the health of society and economic improvement on the level of profits. The discontent revealed by this survey perplexes them a bit as it arises “..despite and uptick in other barometers of American well-being, including a surging stock market and continued signs of strengthening on the employment front.”  It’s all very simple for them, numbers up, numbers down.

But even their employment numbers are skewed. A Household Survey last month put the number of job increases since January at 753,000. But as Mortimer Zuckerman commented in the WSJ last week,  “there are jobs and then there are "jobs." No fewer than 557,000 of these positions were only part-time.”  “The survey also reported that in June full-time jobs declined by 240,000, while part-time jobs soared by 360,000 and have now reached an all-time high of 28,059,000.” Zuckerman adds. The capitalists don’t create jobs because people need them, they buy labor power if they can profit from it; they can’t profit, you won’t work.

Source

Whether the objective pre-requisites in the US are ripe, semi ripe, or rotten enough for a workers’ revolution that could transform the economic and political structure of society is a matter for debate, but there is no doubt that the objective situation is very favorable for activists and a movement for social change, more favorable than it has been for a long time.  That close to 138 million people opted out of the electoral process in the last election is not due to apathy or reaction as some argue.

The Occupy movement had tremendous popular support for a whole period and at the huge gathering in Oakland that shut down three shifts at the port we had as many as 30 to 40 thousand people present, workers and their families, the disabled, students, single mothers with their children and the elderly.  Union workers, the unorganized, white collar and blue collar all came out. The great strength of the Occupy Movement was its audacity, courage and willingness to defy the law but refusing to wage a political struggle and build anything permanent as well as resisting making any concrete demands was an obstacle to its continued success although it is not dead yet.

What is clear is that Trotsky’s statement about a crisis of leadership, not necessarily a revolutionary one at this point, holds true today.  It’s clear that there is intense anger beneath the surface of US society. There is anger at the rich, the bankers, the coupon clippers who flaunt their stolen wealth ever more aggressively.  Anger at the racism, sexism, inequality and lack of basic services in the richest most powerful country in the world. US capitalism’s wars and the cost of them are not popular and are a major cause of the war on living standards and the 1%’s austerity agenda.

The heads of organized Labor could change this situation if they would offer an alternative to capitalism rather than appeasing it, but they will not, trapped as they are by their own view of the world which is the same as the bosses’. Every little step forward, every victory on the part of the working class threatens the relationship they have built with the bosses and capitalism based on cooperation and labor peace and has the potential to lead to chaos.

The figures here are a small example of what actually exists in US society; a restless, angry and insecure population insecure and wary of what the future holds. I will say with some confidence, it is not going to get any better.  It is remarkable in a way that there haven’t been mass riots in the cities at the failure of the US justice system to protect a huge section of the population from racial violence or women from sexual discrimination and rape and all workers from the threat of joblessness, homelessness and security.  Capitalist courts cannot protect workers; as institutions of a racist society they inevitably abandon the victims that society in general.  Millions have lost homes, jobs, have no health care and can’t afford to get it, as the Wall Street Journal asked a couple years ago, “Why No Outrage?”.

US society is a tinderbox, an overconfident capitalist class will make some serious mistakes. Congress still needs to cut more social spending and at some point there will be further explosions in the streets much like the Occupy Movement. It could be over any number of issues as people are pushed beyond their limits.  There are increasing protests against environmental degradation for example. Strengthening and broadening this movement as it develops is an important aspect of any activists activity and revolutionary socialists must be seen as the most ardent supports of and defenders of the movement as it develops.  And by avoiding the traditional mistakes of sectarianism, ultra leftism (making demands of the movement that do not correspond with the mood) and opportunism, building a revolutionary socialist current within this movement as it develops, a crucial element of it if we art to make permanent gains as opposed to partial victories, will be successful.   

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West Texas, capitalist terror, don't forget it

West, Texas explosion: no accident

by Richard Mellor

Afscme Local 444, retired

I see that the market driven catastrophe the world knows as Fukushima got a small mention in the media last week.  William Boardman writing for the left leaning, Reader Supported News points out that, “By official measurement, the water coming out of Fukushima is currently 90,000 times more radioactive than officially "safe" drinking water.“

It is not surprising that these developments are not prominent in the mainstream media as the 1% would rather the issue go away. The huge demonstrations and protests that are occurring throughout the world against the savagery of the market are no competition for such important events as actress Leah Remini’s break with Scientology.

The effects of Fukushima, the BP oil spill and other “unnatural” disasters will be felt and understood by those closest to the source of the crisis, the plants, animals and human beings whose health will be aversely affected.  The capitalist class is very short sighted, some of the effects of such disasters will not be clearly understood for centuries so best leave it alone and make some money while we can.

 In April and the following months, the US mass media was absorbed, as was US society, with domestic terrorism as bombs exploded at the end of the Boston Marathon. Boston, a major US city was put on lockdown as the authorities searched for the alleged perpetrators.  No doubt we will be very well informed about the trial of one of the captives. There are some who believe that the real perpetrators were right wing US terrorists as the bombing occurred on April 15^th, or Tax Day in the US when returns have to be in to the IRS, but that’s another issue.

Two days after the Boston bombing an explosion at a fertilizer plant in West, Texas, rocked that city.  The loss of life was far greater and the damage more extensive, 15 people were killed and more than 150 homes destroyed or damaged in a 37 block area. A high school, middle school, apartment complex and a nursing home were also destroyed in the April 17 blast. “Chunks of concrete were fell from the sky like cartoon anvils…” writes Business week.

 As I commented previously, this was no an accident but also an act of terror.  So far no one had been arrested or imprisoned for this crime.  But there are plenty of culprits.  As Peter Dreier and Donald Cohen pointed out:

“The chemical industry has been one of the most effective lobby groups in this regard. In the 1970s, for example, the industry lobbied Congress to prohibit OSHA from regularly inspecting workplaces with fewer than 10 employees in industries with low reported injury rates. Fertilizer plants are included on the list of exempted industries. This may be why OSHA hadn't inspected the West Fertilizer plant since 1985. If they put profit before people, and allow greed or indifference to put lives at risk, they should be punished”

I agree with these authors of course but we live in a capitalist economic system where the means of production are privately owned and profit is supposed to come before people. In fact, profit has its source in the unpaid labor of workers who, as part of the labor process produce more value than the sum of their wages.  Capitalists set the productive process in motion if it’s profitable first and foremost.

The production of food must be profitable and the production and storage of fertilizers that can increase productivity is no different. Any obstacle to profit and capital accumulation is cleared like brush fire, regulation by the state, unions, community activists and organizations etc. Billions are spent bribing the politicians of the 1% in to ensuring laws protecting workers consumers and our communities are not enacted.

What happened at the West Fertilizer plant was some 28 to 34 tons of Ammonium nitrate, equivalent to 15,000 to 20,000 pounds of TNT, exploded,.  The explosion left a crater 93 feet wide and 10 feet deep. West Fertilizer was a retail family plant owned by Adair Grain.  There are some 6000 retail plants in the US, many of them owned by the giant agricultural outfits but “No one tracks the number of retail facilities in operation” writes Bloomberg Business Week.   The explosion was horrific.  Business Week describes what it did to Robert Payne, one of the town’s residents who was found by neighbors “The shock wave had lifted him out of his boots and thrown him 35 feet through the air in to the side of a large plastic tank of livestock feed.” Payne survived with the help of his neighbors; he was one of the lucky ones.

As I pointed out in an earlier blog, all sorts of reasons have been thrown out there that can explain away this tragic event. The plant ”Fell Through the Cracks of Regulatory Oversight.”, said the New York Times on April 24^th adding that, there were “bureaucratic cracks at the federal, state and local levels.”

But why were there regulatory cracks, or bureaucratic cracks or any sort of cracks? Why are one group of people allowed to prevent through bribery, laws that if acted on, would protect workers and our communities?  When they talk about big government and slashing public services in the interests of economic growth and prosperity sometime in the future, they are increasing the likelihood of further catastrophe’s like West Texas.  We have seen many in the past period including mine explosions, refinery explosions and tragedies of historical proportions like the BP spill in the Gulf of Mexico and the Fukushima disaster.  Ask yourself ordinary citizen; who would put a nuclear reactor on an earthquake fault in an area of the planet known as the Ring of Fire due to its seismic activity and next to the ocean in a land whose language gave us the word Tsunami?

“Experts” decided to do that, and that decision was based primarily on profit.

In the case of West Texas, politicians and business big shots decided that it was OK to have a fertilizer plant surrounded by homes and a couple of schools.  The nearest fire hydrant to the plant was 2500 feet from the burning building at the plant. Obama and his drone program can blow a family to bits 3000 miles away yet a basic thing like a fire hydrant can’t be placed in a area it might serve the public good here in the US.

Two months after the blast the Federal Emergency Management Agency (FEMA) refused the state’s request to declare West, Texas a major disaster site which meant the town was denied some $17 million in aid although the federal government did allot $25 million in aid but the decision by FEMA was not popular with local resident, “Everybody expects you to work and pay taxes..” West resident David Pratka told Business Week, “..and when it comes time to get help you don’t get help.”

But our taxes are needed for much more important areas of work like giving former ruthless dictators like Mubarak $2 billion a year, or producing military hardware for the Saudi thugs or another billion or two for the Zionist regime to ensure that apartheid state maintains its brutal occupation of Palestinian land. The bases in Afghanistan, Iraq, and all over the world cost money.

As is always the case in these instances, lawsuits have been filed. West has filed against Adair and its “deep pocketed”supplier, CF industries and individuals have filed against Adair Grain.  The town has argued that CF industries should have inspected the plant.  After the fact it is now recognized many things could have been done to prevent the explosion, (it was recognized before but why interfere with profit making.) including not surrounding the place with homes and schools where we educate our children.  The structures and plant facilities are now recognized to have been lacking.

The chairman of the US Chemical Safety Board testified to the US Senate in June that their investigation, “has not identified any US standards or guidance that prohibit or discourage many of the factors t likely contributed to the West disaster.”.  How many times have we heard these excuses?  Companies claim after workers die or communities are poisoned by their toxic waste that the taxpayer has to clean up, that “we complied with all the relevant laws and regulations” and indeed they do. You can’t break rules and regulations that protect the public when their politicians ensure that such laws don’t exist. “It’s easy to say you’re not in violation of any regulations if you don’t have any regulations”on of the lawyers representing plaintiffs tells Business week.

The mass media representing the economic interests of the 1% spouts propaganda against big government, unions and regulation as anti-American and damaging to the nation and its economy meaning all of us as if workers and capitalists have the same economic interests. The reality is, the aspects of state intervention they oppose are those that deny or limit their ability to rake in the dough at the expense of workers, the middle class and the precious environment that we depend on for human life.  Their propaganda and fear mongering about foreign terrorists and Muslims is a smoke screen. The day after this act of terror in West, Texas Governor Rick Perry made it clear more regulation wasn’t necessary even though there is no regulation by any serious standards.  This is a character who wages war on the rights of women and says he is pro-life as he supports the mass incarceration and murder of workers and the poor by the state.

There is one last aspect of this for me.  Ammonium nitrate is a fertilizer and the Business Week article from which much of the information in this commentary originates, states that, “Without synthetic nitrogen fertilizers it has been estimated that the earth could feed only 3.5 billion people or half its current population…”  We need to ask ourselves, “Whose estimation is this?” It is the estimates of scientists, demographers, agronomists and all the experts in the employ of capitalism. Willingly or not, they start from the position that the only way to produce food is for profit and under the direction of private capital. The same people using the same methods claim overpopulation and the poor having too many children are behind the race to provide more food which means more  fertilizers with the environmental destruction that results; there are “too many people “ they argue.*

But it is not too many people that is the problem. It is that food is a commodity like anything else in a capitalist economy including human beings or water. The problem is how we produce food.  The primary motive is profit and the entire industry is based on it.  I do not intend to go in to that here but how we produce food in a democratic socialist society would be entirely different and not dominated by a few giant agricultural corporations.

And while I wouldn’t argue against regulation in a capitalist economy, we know through experience that they will not regulate themselves. They will always put profit first and they will bribe their politicians to ensure that is so or regulators will simply allow them to write their own rules as they did with the energy industry with regard to deep water drilling which led to the deaths there and the poisoning of the Gulf of Mexico.

Our security and the fate of our children and the health of the planet on which we live can only be assured when we control the economic and political decisions that affect us, from the production of our food to the building of our cities and the protection of our land and water. A genuine democratic socialist society as part of a world federation of democratic socialist states is not a dream, it’s a necessity.

*For an excellent response to this false argument read: Too Many People by Ian Angus and Simon Butler. You can purchase the book here

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