Clueless or Just Plain Stupid?

from Peter Radford

Here we are deep into the dark forest known as the Trump administration and half my friends are still grappling with the 2016 election result. How come America elected an erstwhile tyrant? How come a boatload of voters look quite happy tossing so-called democracy overboard?

Well, as you know, I have a simple answer. Money. Or, more precisely, the lack of it. If there is one characteristic of contemporary America that stands in stark contrast to those happier times a few decades back it is the corrosion of self-confidence and belief that  is a direct consequence of the obliteration of wage growth.

For some reason that eludes me our policy elite — both parties, the big media, academics, and business leaders — all fail to understand that for them to be allowed to govern peacefully on behalf of the masses they need to deliver the goods to those masses. Else they get a rude awakening.

This particular rude awakening was the arrival of the nincompoop called Trump.

Elites gain and keep power through two methods: one is the ballot box, which has the advantage of being relatively peaceful, and the other is force. Our elite tried to invent a third way, which is corruption of democracy and its perversion into plutocracy. The ballot box stayed in place, but was rendered increasingly meaningless by a relentless campaign to subvert electoral decisions by drowning the legislative process in oceans of lobbyist distributed loot.

This effort was a huge success. 

Our elections have become irrelevant. No matter which party is elected subsequent legislation will bolster the elite at the expense of the masses. Meanwhile those masses are then told to buckle up, work harder, get better educated, and get ready for austerity. Why? Because hard times are upon us and we can’t afford any goodies for the masses. Entitlements are programs for the masses and sound greedy. The national interest is a program for the elite and sounds lofty. Nowadays the two no longer intersect. So entitlements have to go. After all the national interest sounds like a lofty goal.

[Wave the flag here. Start a war there.]

Meanwhile in the trenches, and as part of this program, corporations have adopted a strict shareholder value policy that is intended to drive down wages. Employees being a cost rather than an asset, they are homogeneous, malleable, and ultimately disposable. What were once benefits used to entice worker loyalty have become costs to be cut. The extra cash available is then funneled to shareholders who shift it abroad to avoid taxes or to invest in places with cheaper labor.

Which brings me to our new Fed chief Jerome Powell.

Is he clueless or just plain stupid?

Having been complicit in the above game, although his comments suggest he had no clue about the ideological content of the game, he spoke yesterday about his surprise that the newfound strength of the economy, its low unemployment, and the influx of cash to corporations generated by the recent tax cut wasn’t generating a surge in wages.

His antiquated and ideologically driven economic models tell him this is odd.

So he expressed surprise. He actually used the words “puzzle” and “mystery”.

What a dolt.

There is no puzzle. Nor is there a mystery.

American elitist policy has been explicitly constructed to squeeze workers to the bone in order to bolster profits. Those policies are indifferent to the state of the economy. They are an expression of power. And contemporary power resides in the hands of the corporate elite. Since the balance between wages and profits is not a function of the exquisite mathematics of neoclassical economic theory, but is determined, instead, by raw power, the fact that economic indicators suggest that wages ought to be rising is irrelevant.

The real factor to watch is the balance of power which is something economists explicitly ignore in order to maintain their ideological purity.

And the struggle for power just threw Trump into the finely tuned gears of the elite’s self-enriching engine.

Let me correct myself: I don’t think Powell is either clueless of just plain stupid. He is simply trying to ignore reality.

Because reality has become inconvenient. It contradicts what our elite prefers to believe.

So rather than waste time tearing their hair out over Trump’s manifest ignorance and disregard for democracy, perhaps my friends all ought to be pondering their own role in transferring power to the unelected elite that is currently enriching itself and starving the masses of a prosperous and secure future.

So who is clueless?

Who is just plain stupid?

Do you want democracy or not?

If you do, ponder on the state of the demos.