The Koch Bros: Liberationist or Liberal?

The Koch Brothers are capitalists – no surprise. Their source of wealth is the energy industry, chiefly petroleum and related enterprises including down-stream chemicals, agriculture, electronics, and even tax and accountancy. All this is available on their corporate website and career pages – just crying out for your job application like any regular employer. You can reach those pages through Google [Koch Industries and Koch Careers]. There you will find that their website banners represent them as the very different from the enemies of democracy so familiar from the hate-placards seen on Internet and Facebook where hysterical voices vie with more credible commentators such as Huffington Post‘s Bill Bigelow to chart their grip on US law-making and education in the Right-Wing’s campaign against “big government”. 

Koch Bros.

Koch Bros.

The Kochs call themselves ‘liberationist’ as distinct from ‘liberal’ or ‘neo-liberal’ in current American parlance. ‘Liberationist’ is virtually synonymous with the Tea-Party Movement which equates the American Dream with the maximum of freedom for capital and the minimum concern for those who have failed to accumulate it in profitable amounts.

Together with this crude philosophy, they believe that market laws are the sole and suffficient agent of any worthwhile forms of social development and economic progress. Hence they fund right-wing candidates who share their outlook on a huge scale in Presidential and other elections. According to their own account, $600 million dollars has been set aside to see Obama out next year – a sum that coincides with the profits they are accused of having made by tax evasion last year through the Grand Duchy of Luxembourg and Swiss Banks.

Where do the Koch come from? This is not an ethnological enquiry, though it may be safe to say that someone in their lineage the distant past worked in a kitchen – possibly on a feudal estate in German-speaking lands. Koch Industries was founded in 1940 and its entire history co-extensive – and possibly asymptotic – with the development of the Western economy in the First World since the end of the Second World War. This remarkable period was characterised by the rapid rebuilding of war-torn economies in Europe and the growth of the American economy to globally unprecedent heights – with corresponding increments in the proportion of salaries to capital during much of that period.

It was, indeed, the golden age of the middle-class worker, who emerged festooned with private property and pensions on a scale unimaginable before. Since the marked decline in the proportion of middle-class income expressed as a percentage of Gross National Product began in the 1980s, however, capital has resumed its traditional place as the dominant factor in the economic equation while, at the same time – for related reasons – the rate of national growth in the developed countries has dropped to 1 or 2%, at which level it seems sure to stick until another (limited) world war comes along. 

It is important to stress that the emergence of capital as the dominant force in the economic landscape is the central narrative of the last three decades – capital being the amount of the economy that private individuals own and can exchange as property or currency in the market place. Not skills, not labour: material things (including land and buildings) and their fiscal equivalent at any point in time. On the most convincing available analysis, this development is inherent to the capitalism system and was only checked by two world wars – at least according to Tom Piketty and his research team who subjected the broad premises of Marxist economics to statistical testing and found that the ration of capital to income stood at 2:1 in 1950 but has now returned to the 8:1 level of the pre-WWI period of classic capitalism.

Bernie Sanders takes on the Kochs

Bernie Sanders takes on the Kochs

This is identical with the claim made by Bernie Sanders and others that the distribution of wealth in America is moving towards 1:99 and the related observation that the wage-earning and the salaried classes are heading to extinction – leaving an abject working class and the infamous 1% of billionaires unless reform or revolution intervene. In fiscal terms it means that the largest part of national wealth in US and UK (and satelite countries) is in private hands, a state of affairs which exactly corresponds to the definition of capitalism – an engine of economic growth for which no successful alternative has been invented.

I here quote a couple of pertinent sentences from his Capitalism in the 21st Century (2011) – translated by Arthur Goldhammer, a very considerable commentator in his own right:

“There is absolutely no doubt that net public wealth .. is quite small and certainly insignificant compared with total private wealth. Whether or not public wealth represents less than 1 per cent of national wealth, as in Britain, or about 5 per cent, as in France […] the crucial fact here is that private wealth in 2010 accounts for virtually all of the national wealth in both countries: more the 99 per cent in Britain and roughly 95 per cent in France, according to the latest figures.”

Unlike previous periods, however, this wealth is largely held as migratory capital rather than in land, buildings or fixed bonds. Hence Picketty’s chapter-title “the Metamorphoses of Capital” which he uses to describe the way that profit is now multiplying under the aegis of neo-liberalism in the age of global economics.

A nasty aspect of the otherwise laudable resistance to plutocratic politics epitomised by the Koch Bros. is the link with anti-Semitism at the extreme end of anti-Zionism. In this a certain assumption is being made about the Kochs’ ethnicity which may or may not be true. This is obviously treacherous ground and I think it is worth saying that, while the Kochs obviously bear a German family name, it is neither transparently clear or otherwise significant that they may be Jewish – still less that they have any affinity with the state of Israel. To all appearances they are as American as the proverbial apple-pie – or Betty even Crocker, to cite an iconic figure in the culinary department. Whether Americans of German extraction are more likely to have their heads screwed on as regards the use and abuse of capital than other strands in the population is  speculation too far from this web page.  

Lesson for our times?

The Gospel for our times?

Thomas Piketty’s depressing scenario does not necessarily mean that those who are not the nominal owners of such vast wealth are necessarily impoverished in absolute terms. I say nominal meaning that the wealth naturally aggregates to certain centres which are attached to individuals in the form of legal property – but that the wealth has its own momentum and even its own volition which they, in practice, execute.

Indeed, according to Piketty, there is no necessary connection between capitalism and democracy – neither fostering it nor demolishing it – although historians may find that it could not have emerged without the development of a “Third Estate” and the institution of parliament/parlement in Western nations. In other words, the Koch’s have mighty influence but they cannot ultimately dictate the form of social politics if the good sense of individuals prevail against them.

Individuals are fallible – to say the least – and the kind of enlightenment about war in the Middle East (as well as South-East Asia) for which Noam Chomsky is justly famed is likely to become more popular in years ahead as the misguided policy and catastrophic cost associated with those adventures enters common knowledge. (In other words, when middle America wakes up to the real nature of its social interests.) Four words to retire to the rest-home: “insurgent, terrorist, savages and patriots”. The trouble is that the second factor in global readjustment – a massive shift of income-earning from the West to Asian countries – renders a temperate attitude in the increasingly-impoverished American bloc unlikely.

According to World Bank forecasts, the scales will tip in 2050 when more than 65 per cent of middle-class (i.e., salaried) workers on the planet will be living in China. This shift in global economics will have enormous implications for quality as well as the quantity of social and cultural experience in Europe and America. (I can’t speak about Russia.) But there are serious pitfalls involved in identifying the fate of the middle class as the central determinant of national well-being.

President Obama - "State of the Union" Speech

President Obama – “State of the Union” Speech

It is easy to see that both Bernie Sanders and Obama have moved to the ‘defence of the Middle Class’ as their main platform. What this does to the working-class vote is not hard to guess, but the real problem is that the middle class is not the nation and can never be and should never be a nation.

Middle-classness is simply a comparatively sheltered harbour in an economic storm. In which respect, the population to protect is the whole crew of the ship not just the passengers or the officers. Increasingly, in fact, the phrases ‘middle class’ and ‘working class’ are used together in Democrat platforms – as if it were self-evident that these two classes share a vested interest in the struggle against the proverbial 8% of the most wealthy people in America (sometimes proleptically spoken of as the 1%).

How odd this is can be judged by the fact that the middle- and working- classes in Britain and Europe are generally opposed to one another at the hustings since the capitalist is styled middle-class in comparison with the traditional aristocracy, who hog the economically vacuous term ‘upper class’ – hardly more than a matter of silver forks and paradoxically-named ‘Public School’ accents. In reality, however, the terms that best descrie the functional economic classes of developed countries today might be as follows:  

  1. Upper-class  – i.e., all of those with large amounts of property or money, or access to the same;
  2. Middle class – i.e., all those who trade their university-based skills for technical, managerial, or entrepreneurial roles;
  3. Working class – i.e., all those who use their bodies to make the goods or provide the services which the others (and, to some extent, they themselves) consume;
  4. Finally, the distressingly-named under-class, i.e., all those who have access to none of the above prequisites or roles and live on government hand-outs in respect of income, health and housing, as well as what they can extract from society by breaking its law.

One of the persistence myths of American social life – and a fuelling idea behind Tea-Party style politics – is the notion that America is essentially a classles society. Otherwise stated, class designation is irrelevant to the real status of Americans since to be American guarantees the maximum of freedom. It is this idea which confers on 

To a significant extent the last-named is co-extensive with the prison population in keeping with the Wildean prescription that the ‘deserving poor’ would be unworthy of respect – and all hence they rate as the most glaring victims of the social system – such as it is – in capitalist societies today.

Percentage in US prisons by race

Percentage in US prisons by race

Now, the American Way of Life requires ‘losers’ as well as ‘winners’ and it is the under-class which chiefly maintains a healthy the supply of the former. It also to some extent requires their visibility although in a well-ordered community, this is predominantly confined to certain areas – an arrangement which afforded the open scenes of The Bonfire of the Vanities with its shocking setting.

One of the transparent effects of the economic inequality of races in America – and, to comparable extents, in some European countries – is the disproportion between white and black convict numbers in the prison system. While whites make up 77.1% and black 12.9% of the general population (i.e., six times more whites than blacks), six times are many blacks are found in prison at any time. The bizarre inverse symmetry means that the prison service is, effectively, the most important form of social services available to black Americans.

In this context, Medicare (facetiously renamed Obamcare) may be looked upon as an attempt to redress the balance. But since Right-wing America will not ‘buy into’ free medicine and related social services which might have the overall effect of reducing prison numbers, it is necessary to address the disproportionate figures of black prisoners – including an corresponding proportion on death row – by other means.  

At present the Republican Party is attempting for the fiftieth time to close down Obamcare in Congress on the grounds that it threatens the monopoly of private medicine – one of the most profitable service industries in the land. Republican propaganda has been hugely successful in deterring Americans from joining the government-mandated scheme which is massively in their own interest and, in consequence, about six million are now liable to fines for not starting medical-insurance accounts. The result is likely to be a tax rebellion. Yet every objective measure indicates that, low as the level of cover is, Medicare is the only way to address the health problems of the nation – though cynics might suggest that Liposuction is an alternative solution. 



In the light of all of this, it is very likely that the Obama administration will go down in flames in 2016, and when it does the American people will find themselves in the position of the Ulster Unionists (!) when they were finally rounded up and driven into the Belfast Peace Agreement – an eventuality which John Hume wittily called ‘Sunningdale for slow learners.’

Eventually they must learn that a free-market gun-totting American is an impoverished continent in which confused victims of defective social legislation increasingly turn on each other along all the usual lines of class division. In America the index of such violent reaction is normally the state of the custodial (or ‘penitential’) system. And, much as the American majority hates and fears the word socialism, it must eventually learn that measure of economic distribution and social care in every want tantamount to what Europeans mean by that term are indispensable to the mind of working community that they so ardently believe in.  

Here comes the final irony. The Kochs Bros., do not think that current levels of incarceration in America are A Good Thing, and so they have entered into a joint-campaign with Democrats and assorted left-wingers for Prison Reform and a radical rethinking of the custodial system. No wonder: it’s costing $80 bn a year – a great deal more than food stamps and Medicare together. In fact, it IS the de facto social services for all those who are not capitalists or members of the shrinking, salaried middle class. “Prison Break” is the reality of modern America – a fact not unknown to the makers of household entertainment. Nowadays a prisoner is likely to be a cool dude – though some are obviously “Teabags” – and the corresponding bottom-up view of American society is fast emerging as a significant alternative to the top-down vision of senatorial New England and the “people on the hill” in Boston. Item: Rap Music and its socially-attuned antipathy to the police – unquestionably mutual. (And we had a Punk group called “Police” – how cute is that?)

This development can plausibly be glossed as the American equivalent of a socialist revolution. Otherwise stated, when they sent Sacco and Vanzetti to the gas chamber, they relocated the site of American revolutionary politics in the prison system. All I can say is that I wish they’d do it in Brazil, where decapitation is all the rage today and where the levels of “in-detention murder” are so high that a parking fine is beginning to look like a death sentence. 

20 February, 2105

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