Posts Tagged ‘Republican Party’

US capitalists as political saviours.

datePosted on 14:19, March 2nd, 2021 by Pablo

Having watched and read about the Conference of the Paranoid, Angry and just plain Crazy (CPAC), including the Orange Merkin’s return to the political centre stage, I am more convinced then ever that if US conservatism, and indeed the US itself, is to find its way back to some semblance of stability, it is US capitalists who will have to lead the charge. This may seem odd for a left-leaning blog to say, but the logic underlying the rescue lies in some structural imperatives and some non-structural pathologies.

As has been written before in these pages, the State and Society in the US and places like NZ are capitalist because they depend on a profit-driven system of capital accumulation and distribution for the welfare of capitalists and workers alike. Capitalists invest and pay wages out of profits, so both overall economic and specific wage growth depend on the continuation of the profit-investment cycle. Capitalists borrow from other capitalists in order to grow their businesses, which in turn help expand the web of opportunity (measured in employment and/or higher wages) for wage-earners down the productive chain. In other words, the material welfare of everyone depends on the investment decisions of capitalists.

This is the structural imperative: the State and Society are capitalist because of their material dependence on a system of private accumulation and economic decision-making. Even state capitalist systems abide by the immutable laws of the profit-investment cycle, but in the US (and NZ) the vast majority of decisions about accumulation and distribution ultimately rest with capitalists. So long as capitalists invest and workers produce so that profitability is sustained, current welfare and future growth is safeguarded.

In order to maintain this cycle and encourage capitalists to re-invest in the domestic economy, the State uses tax and social policy to sustain economic growth and otherwise frame the investment “climate” in ways conducive to investor confidence. The ways in which it can do so and the effectiveness of what it does is influenced, when not determined, by the political and social climate of the current moment and the outlook for the future. That is because above all, capitalists want two things in tandem: stability and certainty over time. Socio-economic and political stability lends certainty to the investment environment, which encourages regular rates of investment and return on which to make future decisions on investment and wage-setting. The more this becomes a self-perpetuating cycle, the more a capitalist nation-state grows and prospers, thereby reaffirming the utility of the economic model under specific political conditions.

That is the notion that lies at the heart of classic liberalism: the combination of market-driven economies and democratic political institutions is considered to be the most preferable (or least bad) political-economic model because it places (theoretically at least) a premium on private choice and individual freedom. Within parameters broadly set by a State led and managed by a political bureaucracy, capitalists chose where to invest and workers chose where to work given where investment flows. Or at least that is the general idea.

Here is where the superstructural problem starts for the US. Under Trump, the Republican Party has increasingly become untethered from its pro-business bias and devolved into a national-populist cult of personality. The events of January 6 and sociopathic displays at CPAC–displays not isolated to Trump himself–clearly demonstrate that conservatism in the US is no longer based on pro-market ideologies and an understanding of the structural dependence of the State and Society on Capital. Instead, it is now the fevered product of a hodgepodge of conspiracy theories, religious opportunism, racism, bigotry, prejudice and xenophobia, with many of these inimical to maintaining business growth. Trump is the poster-boy of this collective derangement but the GOP is awash in it far beyond him.

That is bad for business. The threat of irrational political leadership and the distinct and ongoing possibility of civil unrest, including irregular collective violence, undermines the stability-certainty cycle because there is a mutual or co-dependence between the political superstructure and the economic base. Political and social instability can and often does lead to economic instability, something that is bad for all concerned.

Under such conditions overall demand drops, many businesses slow production, workers are laid off and investors hedge, sell and take profits rather than make long-term investment plays. Shorter investment horizons add to market uncertainties, which in the US is compounded by the practices of “shorting” stocks (whereby anticipating further value losses the investor borrows stock and sells it at current market value in anticipation of buying it back a future lower price before the loan expiration date) and stock buy-backs (where companies use profits to buy stocks in the company in order to reduce the number of stocks freely available and thereby squeeze the stock price upwards).

Both of these are forms of speculation rather than productive investment and are a hallmark of the US financial markets. They have also attracted the attention of so-called mom and pop “retail” or “day” traders and semi-organised small investor groups whose goals are individual self-enrichment rather than contributing to industry profitability, job creation, technological innovation or overall economic growth. These speculative practices by small and large investors have a negative impact on investment, employment and wage stability, further undermining popular faith in the economic system and the political edifice that serves and protects it.

The combination of anarchic (and self-serving) financial market behaviour and increasingly anti-business fanaticism in Republican/conservative ranks (think of the constant attacks on the techno-oligarchy for de-platforming extremist speech on social media) has attracted the negative attention of credit rating agencies, where debates about lowering the US government credit rating from AAA (outstanding) to something else, previously unthinkable for the global reserve currency issuer, are now common practice. When combined with the possibility of labour conflicts and industrial slowdowns tied to civil unrest, the rise of deranged demagogic politics within the US political Right is a threat to, literally, business as usual.

It is said that, according to the invisible hand of the market, economic actors are self-interested maximisers of opportunity and that the sum result of their self-interested actions clears the market at the collective level. That may or may not be true. What is true is that the “market” involves political as well as purely economic factors and agents, and when political actors interfere with the the profitability of self-interested maximisers of economic opportunity, then measures must be taken to mitigate or overcome those political obstacles.

For US capitalists the problem is not one of class struggle but about class survival. It is not about class war but about self-preservation. The threat to their status comes not from the working classes radicalised by anti-capitalist ideologies but by self-professed capitalist supporters. Not all supporters of capitalism are capitalists themselves or understand the relationship between capital accumulation and distribution at a macro level, and many do not add value and wealth to society but in fact subtract value and wealth from it (be it in their rent-seeking microeconomic behaviours or other forms of myopic malfeasance). Moreover, US capitalist classes are variegated and often in conflict, with ascendent and descendent class fractions competing for political as well as economic dominance (think high tech versus industrial manufacturing elites).

Trump and his supporters represent a large but descendent segment of the capitalist class constellation, but they are not the only or the dominant faction and are a clear threat to the interests of other (ascendent) capitalist class factions (again, think of the techno-oligarchy). Not all corporate elites in the US favour Trump’s behind-the-wall, low skill, low education, industrial-era blue collar form of economic nationalism, and many see it as a simple wave to the past in the face of (and impediment to) an automated and transnationalised productive future. The political fight is consequently as much more or within the capitalist classes as it is between them and the working/subaltern classes and, however couched in the language of cultural conflict and competing value systems, that fight is microcosmically distilled in the struggles over the direction of the Republican Party.

Let me be clear. This does not mean that anti-Trump capitalist elites are good people or interested in the overall welfare of the nation. People like Jeff Bezos and Elon Musk are as much innovative exploiters of the many as they are creators of wealth and opportunity for some. The entire financial industry is populated by selfish people and greedy logics and is in desperate need of major reform (since the post 2008 crash reforms were cosmetic at best). But the necessity of the situation dictates that these type of people be seen as tactical allies in the fight against neo-fascism at a time when progressive forces do not have the strength to help stem the deterioration of the American Right. In other words, desperate times require desperate measures, and the appeal to anti-Trump capitalists is one such thing. Nothing more.

In some countries, the military serves as the saviour of economic elites under stress. In the US that possibility used to be dismissed as laughable but in recent years became a topic of discussion. Although it continues to be seen as a remote option, the ongoing viability of national-populist sentiment in the Republican Party and emergence of an insurrectionist movement within broader political Right circles keep alive the issue of external intervention in the discussion about how to rescue that side of the political system from itself.

This is why US capitalists have to ride to the rescue of the Republican Party. If they do not do so then others may have to, and it will not be revolutionary workers or the peasantry who will be the ones to step up. Inviting military intervention could be catastrophic to the Nation, assuming for a second that the US military would even consider such a move. Social movements will not have the clout to impress Republicans into reform and change away from what they have become. It is therefore up to capitalists to undertake the task.

The Republican rescue involves tough love. In order to save it, the GOP must be broken from the grasp of the national-populists, cultists, MAGA morons and conspiracy theorists. The best way to do so is with the threat or use of a specific type of capital strike. The corporate elite need to threaten the Republican Party with a complete withdrawal of political funding if Trump and his acolytes are not purged. If that threat is not heeded then the funding should be withdrawn, preferably before the next election cycle begins.

The insurance policy to what otherwise would seem to be a risky strategy is the Democratic Party and Biden administration. For all the talk of socialists and radical Leftists, capitalists know that their bread is buttered by the structural dependence of the State and Society on Capital, and Democrats clearly understand this fact. US capitalists may have a more restrained partner in Democrats and may need to concede more on issues of accumulation versus distribution when they are in power, but at least the Democrats are not led by an irresponsible and utterly self-serving myopic cabal that no longer seems to understand the bread/butter relationship.

One gets the feeling that some of this may already be going on. But to be effective the capitalist political strike against the Republican MAGA wing must be public and comprehensive in scope. Winks, nods and quiet backhanders will not suffice. The move has to be out in the open, at least among the economic and political elites.

If that does not happen or does not work to kick the MAGA morons to the curb, then the possibility of a real capital strike must be considered. It can come in the form of a Wall Street sell-off/downturn manipulated by interests most closely associated with the Republican Party or industry slow-downs in regions where Republican support is strongest (say, places where the fossil fuel industry is dominant). Consumer and advertiser boycotts of and slowdowns in supply chain servicing of privately held companies affiliated with Trump are additional forms of capitalist strike.

Needless to say, however sector-specific any economic downturn will be seen over the short-term as a rebuke of the Biden administration, but if quiet assurances are made as to the real intent of the ploy, then both the administration and the productive sectors involved will survive the moment. After all, the goal is to send a message to the Republican political establishment that business will no longer tolerate the national-populist threat to making money, not to kill off profit-making entirely.

In a weird way, this ploy should come naturally to Corporate America. They sell on the future of a Republican Party dominated by Trump and other national-populists and they buy (short term) on Democrats buttering their bread while they bet long term on non-MAGA Republicans restoring the GOP to its status as preferred political interlocutor. There is risk in this strategy but for the private sector, the US as a society, the political system as a whole and the Republican Party as a political institution, the rewards of embracing it will be well worth the challenge.

After all, capitalism is all about risk-taking under conditions of limited information involving structural and super-structural constraints, so the field is open for private opportunity-taking in the national interest.

A self-mutilation ritual.

datePosted on 11:40, February 8th, 2021 by Pablo

It appears that rather than follow the not-so-sage advice offered here in KP a short time ago about how to save their future as a political party, the Republicans have decided to double-down on their Trumpist/MAGA bet. After the House Democratic majority stripped a recently elected QAnon freak from her committee assignments (I will not mention her name here) because of her deranged behaviour and speech (including calls to kill Democratic congresspeople and claims that the Rothschilds used a space laser beam to start California fires in order to make a profit and that the Sandy Hook and Parkland school shootings were faked), her GOP colleagues reaffirmed their support for her while rebuking the 11 of them who voted for Trump’s impeachment on grounds that he incited the January 6 insurrection in the Capitol building. The freak then held a press conference and announced that the Republican Party was “Trump’s party.” No Republican contradicted her and state Republicans in the home districts of the pro-impeachment GOP renegades voted to censure them.

This is going to end badly for the GOP. Corporate America and (prodded by lawsuits) even mainstream Rightwing media appear to realise the danger that the assault on Congress represents. Non-Republican rightwing extremists have infiltrated the MAGA ranks and exploited them for their own purposes. Conspiracy theory craziness has taken hold in the MAGA movement. Seeing this, some regretful MAGAites have defected once they realised that the Trump pipe dream was not going to become reality or that his claims about the stolen election were deliberate lies that cost taxpayers millions of dollars to refute (in the form of recounts and litigation). To be sure, there are still many who still worship the ground he walks on, but many more are glad to see the back of him and want it to stay that way.

Catering to the remaining MAGA base may solidify GOP support in hard Red states, but the rest of the country is turning Blue as demographics increasingly work against perpetuation of that base as a proportion of the population, much less as a cohesive voting bloc. Insurrectionists are bad for business as well as law and order, so for a party that claims that it is the champion of both, kowtowing to the violent maniac fringe is a losing proposition over the long term. The MAGA brand is turning to mud even if those loyal to it cannot see what is coming at them down the road.

There is the hitch. Most analysts now see the GOP as divided into three parts: a MAGA populist wing, a neo-con Reaganite wing and a bridge faction with feet in both wings that attempts to straddle the fence of specific policy issues (or want to have things both ways–conspiratorial crazy on the one hand and soberly responsible on the other). After the attack on the capitol, what many of the non-lunatic factions in the GOP fear is two things: being physically threatened or attacked by MAGA and QAnon extremists egged on by Trump and his acolytes if they do not accede to his wishes; and being “primaried” out of office by them with funding provided by the Trumpsters (“primaried” refers to the practice of putting up candidates against incumbents in party primaries so as to replace them with more ideologically aligned people).

The combination of physical and political threats has paralysed most of the GOP party leadership, who have opted for the default option of blaming Democrats for assorted ills while looking to them for the knock-out electoral blow on the lunatics in 2022. They understand that things have gone too far and they cannot prevent the MAGA wing from trying to take control of the party as a whole while Trump continues to agitate from the sidelines. So this is their state of play: hope that the Democrats win big in the congressional mid-terms so that they can purge the MAGAites from the party and return to some semblance of conservative normalcy. They know that the purge of moderate candidates in GOP primaries will likely lead to massive losses in the 2022 general election and the consolidation of Democratic control of the federal government for the near future. That allows the non-MAGA Republicans to clear house and get their affairs in order without the burden of having to govern, something that can set them up well for 2024 and beyond. People like Mitch McConnell, Mitt Romney and Liz Cheney understand this well.

Of course, many of those immediately involved in the fray may not see things in this light and may continue the internecine fights over the heart and soul of the GOP well after 2022. The MAGA wing certainly see their future as wedded to Trump, and the Senate impeachment trial will go a long way towards determining which of the GOP factions will prevail over both the short and the long term. But as long as they are divided and the Democrats coalesce while in power and restore some semblance of respect, normality and competence to governing (not a sure thing but more plausible today than in the past because of the stakes at play), then the Republican Party is going to increasingly be on the outside looking in when it comes to national policy-making. And that will suit the lunatic fringe just fine, as they have been exposed as being uninterested in democracy if such a thing involves compromise, toleration, transparency, equality and mutual consent in the policy-making process. That, however, will only increase their marginalisation as a political force. They had their moment during the last four years and soon they will pay a political (and in some cases, criminal) price for their sins.

In the meantime, watching the Republican in-fighting is like watching someone repeatedly cut themselves. The difference is that self-mutilation is most often not fatal to the person doing it, whereas what is going on in the GOP has the potential to be terminal to the party as a democracy-supportive political institution.

The destruction of brand Trump.

datePosted on 11:37, March 13th, 2016 by Pablo

As readers may be aware I am delighted by the Trump candidacy because it is destroying the Republican Party and will pave the way for an epic defeat in the November general elections. Not only will the GOP lose the presidential race because none of its candidates will be able to muster the votes needed to overcome the Democratic advantage (be it Hillary or Bernie who lead the ticket). It could well lose control of Congress on the negative coattails of the presidential race (the entire House and 1/3 of the Senate are up for grabs, with the Democrats needing to win 4-5 current Republican seats in order to gain control of the Senate). It does not matter if Trump is the GOP presidential candidate or if he or another Republican go independent in the wake of the convention, which itself promises to be a bloodbath. The vast majority of swing voters and independents, who tend to vote on the Left in any event, will be galvanised to vote against whatever the Republicans have to offer, Trump in particular. For all his bluster about bringing out new voters on the Republican side, what he really has done is bring out new voters on both sides–most of whom are against him. As a result, the GOP is doomed and could well split into Tea bagger/populist and “moderate” right parties in the wake of what is looming as an electoral  catastrophe of historical proportions.

A tipping point has been reached this week with the escalation of protests against Trump at his rallies and the retaliatory violence of his supporters and campaign staff and security against those who dare confront him on his xenophobic bigotry and inflammatory rhetoric (and one has to ask why local law enforcement and the Secret Service act as his praetorian guard when removing peaceful protesters at his behest. After all, they are not in his employ and are not legally authorised to detain, handcuff and arrest people exercising their right to protest in public spaces just because he wants them forcibly removed).

The cancellation of a Chicago rally because of protests will only encourage more of them, and they will be increasingly large and organised in nature. That in turn will enrage Trump, who does not have the good sense (or even basic ability) to moderate his venom, which will bring out the full nut case element in his support base (which has already started to appear more and more frequently). Unfortunately, it is now a very real possibility that someone will be killed or seriously injured at a Trump rally, and the perpetrators will be his supporters, not his opponents.

When that happens, the wheels will come off the Trump political cart.

By then the damage to the GOP “brand” will have been irretrievably done. But what I find just as wonderful is that Brand Trump itself is now irreversibly damaged as well. However illusory, it used to represent luxury, opulence, quality, style and the excess that comes with success. It had global recognition. It was synonymous with capitalist high rolling, only in part because of his obsession with casinos.

In the wake of this presidential campaign, that image has been replaced by something less illusory and much darker. “Trump” is now synonymous with racism, xenophobia, buffoonery, demagoguery, narcism, sociopathy, chauvinism, misogyny, war-mongering, bullying, cheating, lying, senseless violence, stupidity–the list goes on. Whatever people may have done by way of word association with the name Trump in the past, my bet is that the first thing that now comes to mind when his name is mentioned is some of the negative terms mentioned above.  In fact, the word Trump may well become an adjective or verb, as in “that old white dude went all Trump on me when I said that Obama was not a Kenyan,” or “that reactionary fool is just plain Trumped in the head.” It could even be used as a noun, for example, as in “Trumpster:” n.: an idiot, fool, dolt, ignoramus, numbskull, someone who is gullible, slow on the uptake, blindly naive or prejudiced in the extreme.

His tarnished brand may survive in the US, perhaps in red neck resort destinations like the Florida panhandle and the coastal Deep South and/or parts of Appalachia. But many Americans, and not just “ethnic” Americans or Democrats, will shun his products, services and anything with his name on it. There may be boycotts and protests organised against them. And with the possible exception of Putin’s Russia (given the mutual admiration society he runs with Trump), as a global brand it is finished. Think of the Arabs, Latin Americans, Asians and even Europeans that Trump has scapegoated and insulted. Any current or potential Trump business partner or investor now has to wonder if they will be tainted by association with him and whether their business will suffer as a result. Given daily revelations of his less than salubrious past business dealings, profound dishonesty and myriad failures that have ruined others much more than it has hurt him,what foreign governments other than those of tinpot dictators are going to want a bar of him as an investment partner? Even better, increased scrutiny of his business dealings may well result in criminal charges being laid against him, which will only add to the tarnish on the brand.

The hard fact is that the Trump campaign will prove deleterious for Trump business holdings, which explains why his managerial minions, “the best people” in his words,  are currently in the process of putting legal and PR distance on him. The trouble for them, however, remains embedded in that ubiquitous name.

This is the silver lining in the Trump cloud. Not only has he exposed the ugly side of US politics. He has exposed himself and his illusory brand in doing so. He is taking the GOP down along with him, and neither it or his brand will survive the fall intact.

That is truly a good thing.