Truth Dig – by Chris Hedges
Chris Hedges gave this talk Saturday night in Brooklyn at the People’s Recovery Summit.
The corporate state has made it clear there will be no more Occupy encampments. The corporate
state is seeking through the persistent harassment of activists and the
passage of draconian laws such as Section 1021(b)(2) of the National
Defense Authorization Act—and we will be in court next Wednesday to
fight the Obama administration’s appeal of the Southern District Court
of New York’s ruling declaring Section 1021 unconstitutional—to shut
down all legitimate dissent. The corporate state is counting, most importantly, on its system of debt peonage to keep citizens—especially the
30 million people who make up the working poor—from joining our revolt.
Workers who are unable to meet their debts, who are victimized by constantly rising
interest rates that can climb to as high as 30 percent
on credit cards,
are far more likely to remain submissive and compliant. Debt peonage is
and always has been a form of political control. Native Americans,
forced by the U.S. government onto tribal agencies, were required to buy
their goods, usually on credit, at agency stores. Coal miners in
southern West Virginia and Kentucky were paid in scrip by the coal
companies and kept in perpetual debt servitude by the company store.
African-Americans in the cotton fields in the South were forced to
borrow during the agricultural season from their white landlords for
their seed and
farm equipment,
creating a life of perpetual debt. It soon becomes impossible to escape the mounting interest rates that necessitate new borrowing.
Debt peonage is a familiar form of political control. And today it is
used by banks and corporate financiers to enslave not only individuals
but also cities, municipalities, states and the federal government. As
the economist
Michael Hudson points out, the steady rise in interest rates,
coupled with declining public revenues, has become a way to extract the
last bits of capital from citizens as well as government. Once
individuals, or states or federal agencies, cannot pay their bills—and
for many Americans this often means medical bills—assets are sold to
corporations
or seized. Public land, property and infrastructure, along with pension
plans, are privatized. Individuals are pushed out of their homes and
into financial and personal distress.
Debt peonage is a fundamental tool for control. This debt peonage
must be broken if we are going to build a mass movement to paralyze
systems of corporate power. And the most effective weapon we have to
liberate ourselves as well as the 30 million Americans who make up the
working poor is a sustained movement to raise the minimum wage
nationally to at least $11 an hour. Most of these 30 million low-wage
workers are women and people of color. They and their families struggle
at a subsistence level and play one lender off another to survive. By
raising their wages we raise not only the quality of their lives but we
increase their capacity for personal and political power. We break one
of the most important shackles used by the corporate state to prevent organized resistance.
Ralph Nader, whom I spoke with on Thursday, has been pushing
activists to mobilize around raising the minimum wage. Nader, who knows
more about corporate power and has been fighting it longer than any
other American, has singled out, I believe, the key to building a
broad-based national movement. There is among these underpaid 30 million
workers—and some of them are with us tonight—a mounting despair at
being unable to meet even the basic requirements to maintain a family.
Nader points out that Walmart’s 1 million workers, like most of the 30 million low-wage workers, are making less per hour, adjusted for inflation, than workers made in 1968, although these
Walmart workers do the work required of two Walmart workers 40 years ago.
If the federal minimum wage from 1968 were adjusted for inflation it
would be $10.50. Instead, although costs and prices have risen sharply,
the federal minimum wage remains stuck at $7.25 an hour. It is the
lowest of the major industrial countries. Meanwhile,
Mike Duke,
the CEO of Walmart, makes $11,000 an hour. And he is not alone. These
corporate chiefs make this much money because they have been able to
keep in place a system by which workers are effectively disempowered,
forced to work for substandard wages and denied the possibility through
unions or the formal electoral systems of power to defend workers’
rights. This is why corporations lavish these CEOs with obscene
salaries. These CEOs are the masters of plantations. And the moment
workers rise up and demand justice is the moment the staggering
inequality of wealth begins to be reversed.
Being a member of the working poor, as
Barbara Ehrenreich chronicles
in her important book “Nickel and Dimed,” is “a state of emergency.” It
is “acute distress.” It is a daily and weekly lurching from crisis to
crisis. The stress, the suffering, the humiliation and the job
insecurity means that workers are reduced to doing little more than
eating, sleeping—never enough—and working. And, most importantly, they
are kept in a constant state of fear. Ehrenreich writes:
When someone works for less pay than she can live
on—when, for example, she goes hungry so that you can eat more cheaply
and conveniently—then she has made a great sacrifice for you, she has
made you a gift of some part of her abilities, her health, and her life.
The “working poor,” as they are approvingly termed, are in fact the
major philanthropists of our society. They neglect their own children so
that the children of others will be cared for; they live in substandard
housing so that other homes will be shiny and perfect; they endure
privation so that inflation will be low and stock prices high. To be a
member of the working poor is to be an anonymous donor, a nameless benefactor, to everyone else.
It is time to halt the sacrifice of the working poor. It is time to empower the 30 million low-wage workers—two-thirds of which are employed by large corporations such as Walmart and McDonald’s—to fight back.
Joe Sacco and I spent the last two years in the poorest pockets of the United States, our nation’s sacrifice zones, for our book
“Days of Destruction, Days of Revolt.” We saw in Pine
Ridge,
S.D., Camden, N.J.—the poorest and the most dangerous city in the
nation—the coalfields of southern West Virginia and the produce fields
of Immokalee, Fla., how this brutal system of corporate exploitation
works. In these sacrifice zones no one has legal protection. All
institutions, from the press to the political class to the judiciary,
are wholly owned subsidiaries of the corporate state. And what has been done to those in these sacrifice zones, those places corporations devastated first, is now being done to all of us.
There are no impediments within the electoral process or the formal
structures of power to prevent predatory capitalism. We are all being
forced to kneel before the dictates of the marketplace. The human cost,
the attendant problems of drug and
alcohol abuse, the neglect of children, the early deaths—in Pine Ridge the average life expectancy of a male is 48, the lowest in the Western
Hemisphere
outside of Haiti—is justified by the need to make greater and greater
profit. And these costs are now being felt across the nation. The phrase
“the consent of the governed” has become a cruel joke. We use a
language to describe our systems of governance that no longer correspond
to reality. The disconnect between illusion and reality makes us one of
the most self-deluded populations on the planet.
The Weimarization of the American working class, and increasingly the
middle class, is by design. It is part of a corporate reconfiguration
of the national and global economy into a form of neofeudalism. It is
about creating a world of masters and serfs, of empowered oligarchic
elites and broken disempowered masses. And it is not only our wealth
that is taken from us. It is our liberty. The so-called self-regulating
market, as the economist
Karl Polanyi wrote
in “The Great Transformation,” always ends with mafia capitalism and a
mafia political system. This system of self-regulation, Polanyi wrote,
always leads to “the demolition of society.”
And this is what is happening—the demolition of our society and the
demolition of the ecosystem that sustains the human species. In
theological terms these corporate forces, driven by the lust for
ceaseless expansion and exploitation, are systems of death. They know no
limits. They will not stop on their own. And unless we stop them we are
as a nation and finally as a species doomed. Polanyi understood the
destructive power of unregulated corporate capitalism unleashed upon
human society and the ecosystem. He wrote: “In disposing of a man’s
labor power the system would, incidentally, dispose of the physical,
psychological, and moral entity ‘man’ attached to the tag.”
Polanyi wrote of a society that surrendered to the dictates of the
market. “Robbed of the protective covering of cultural institutions,
human beings would perish from the effects of social exposure; they
would die as victims of acute social dislocation through vice,
perversion, crime, and starvation. Nature would be reduced to its
elements, neighborhoods and landscapes defiled, rivers polluted,
military safety jeopardized, the power to produce food and raw materials
destroyed. Finally, the market administration of purchasing power would
periodically liquidate business enterprise, for shortages and surfeits
of money would prove as disastrous to business as floods and droughts in
primitive society. Undoubtedly, labor, land, and money markets are
essential to a market economy. But no society could stand the effects of
such a system of crude fictions even for the shortest stretch of time
unless its human and natural substance as well as its business
organizations was protected against the ravages of this satanic mill.”
The global and national economy because of this “satanic mill”
continues to deteriorate, and yet, curiously, stock market levels are
close to their highs in 2007 before the global financial meltdown. This
is because these corporations have been able to suppress wages, slash
social programs and bilk the government for staggering sums of money.
The Federal Reserve purchases about $85 billion worth of mortgage-backed
securities and Treasury bills every month. This means that the Fed is
printing endless streams of money to buy up government debt and toxic
assets from the banks. The Federal Reserve now owns assets, much of them
worthless, of $3.01 trillion. This is triple what it was in 2008.
And while corporations such as Citibank and General Electric loot the
Treasury they exact more pounds of flesh in the name of austerity.
General Electric, as Nader points out, is a net job exporter. Over the
past decade, as
Citizens for Tax Justice has
documented, GE’s effective federal income tax rate on its $81.2 billion
in pretax U.S. profits has been at most 1.8 percent. Because of the way
General Electric’s accountants play with tax liabilities the company
actually receives money from the Treasury. They have several billion
dollars paid to them from the federal government into company bank
accounts—and these are not tax refunds. The company, as Nader argues, is
a net drain on the Treasury and a net drain on jobs. It violates a host
of environmental and criminal laws. And yet Jeffery Immelt, the CEO of
General Electric, was appointed to be the chairman of Obama’s Jobs
Council. Immelt’s only major contribution to the jobs initiative was to
get rid of 37,000 of his employees since 2001. Jim McNerney, president
and CEO of Boeing, who also sat on the Jobs Council, has cut over 14,000
jobs since 2008, according to
Public Campaign. The only jobs the CEOs on the Jobs Council were concerned with were the ones these CEOs eradicated. The Jobs Council,
which Obama disbanded this
week, is a microcosm of what is happening within the corridors of
power. Corporations increasingly terminate jobs here to hire grossly
underpaid workers in India or China while at the same time stealing as
much as fast as they can on the way out the door.
As Michael Hudson has pointed out, financialization has created a new
kind of class war. The old class warfare took place between workers and
bosses. Workers organized to fight for fair wages, better work hours
and safety conditions in the workplace as well as adequate pensions and
medical benefits. But with a country of debtors and a government that
must also borrow to continue operating, Hudson says, we have changed the
way class warfare works. Finance, he points out, controls state and
federal policy as well as the lives of ordinary workers. It is able to
dictate working conditions. The financiers, who insist that cuts be made
so governments can repay loans, impose draconian austerity and
long-term unemployment to,
as Hudson told a
Greek newspaper, “drive down wages to a degree that could not occur in
the company-by-company clash between industrial employers and their
workers.”
The former Federal Reserve Chairman Alan Greenspan, testifying before
Congress, was quite open about the role of debt peonage in keeping
workers passive. Greenspan pointed out that since 1980 labor
productivity has increased by about 83 percent. Yet real wages have
stagnated. Greenspan said this was because workers were too burdened
with mortgage debts, college loans, auto payments and credit-card debt
to risk losing a job. Household debt in the United States is around $13
trillion. This is only $2 trillion less than the country’s total yearly
economic output. Greenspan was right. Miss a payment on your credit card
and your interest rates jumps to 30 percent. Fail to pay your mortgage
and you lose your home. Miss your health insurance payments, which have
been spiraling upwards, and if you are seriously ill you go into
bankruptcy, as 1 million Americans who get sick do every year. Trash
your credit rating and your fragile financial edifice, built on managing
debt, collapses. Since most Americans feel, on some level, as Hudson
points out, that they are a step or two away from being homeless, they
are deeply averse to challenging corporate power. It is not worth the
risk. And the corporate state knows it. Absolute power, the philosopher
Thomas Hobbes wrote, depends on fear
and passivity.
The only way to break this fear and passivity is to organize workers
to break the cycle of mounting debt. And the first step to achieving
independence from debt—the primary form of political control by the
corporate state—is to raise the minimum wage. There are other
solutions—forgiving mortgage and student debt, instituting universal
health care, establishing a nationwide jobs program to rebuild the
country’s Third World infrastructure, and green energy—but none of this
will happen until we are able to mount a sustained mass movement that
discredits the corporate state. This mass movement will arise, as Nader
says, when we mobilize around the minimum wage.
The lowest-grade worker at the General Electric plant that makes
high-tech health care devices outside Paterson in Totowa [New Jersey]—a
pay grade known as the D 04—was just raised to $14,555 a year. That is
under $8 an hour. The plant’s highest-paid hourly employee, known as D
16, earns $22,000. Immelt makes over $11 million a year. This vast
disparity in income, and this wage abuse, is played out in every
corporation in the country. No one in Washington intends to challenge
it.
Only 11.3 percent of workers in this country belong to unions. This
is the lowest percentage in 80 years. And nearly all these unions, and
especially the AFL-CIO, have been emasculated by corporate power.
Nader is right when he warns that we are not going to be assisted in
this effort by established unions. Union leaders are bought off. They
are comfortable. They are pulling down at least five times what
rank-and-file workers make. Nader says we have to mount protests not
only outside the doors of Walmarts and General Electric plants, not only
outside congressional offices, but outside the doors of the AFL-CIO.
There is no established institution inside or outside government that
will help us. They are all broken or complicit. But there are the 30
million working poor who, if we organize to break the system of debt
peonage that holds them hostage, may be willing to rise up. We are bound
with many chains and shackles. We will have to break them one at a
time. But once we rise up, once we are able to threaten the corporate
systems that keep us supine through fear, we will unleash a torrent of
energy and passion that will confirm the worst nightmares of our
corporate overlords.
http://www.truthdig.com/report/item/breaking_the_chains_of_debt_peonage_20130203/
