The Capitalists Are Afraid
Above Photo: Mr. Fish / Truthdig
Capitalists seek to maximize profits and reduce the cost of labor. This sums up capitalism at its core. It is defined by these immutable objectives. It is not about democracy. It is not, as has been claimed, about wealth creation for the working class. It has nothing to do with freedom. Those capitalists, especially in corporations, who are not able to increase profits and decrease the cost of labor, through layoffs, cutting wages, destroying unions, offshoring, outsourcing or automating jobs, are replaced. Personal ethics are irrelevant. Capitalists are about acquisition and exploitation.
Capitalists go to absurd lengths to lie about capitalism’s true nature. It is why Business Roundtable’s most recent version of its Principles of Corporate Governance, signed by 181 major CEOs—including the heads of Amazon, General Motors and Chevron, all three of which paid no federal income tax in 2018—rivals the doublespeak of the worst totalitarian regimes of the 20th century.
If maximizing profit means turning the oceans into dead zones, filling the atmosphere with carbon emissions and toxins that render the climate unfit for humans, pumping chemicals and waste into the soil, water, air and food supply that ensure that cancer is an epidemic, buying off elected officials and judges to serve the exclusive interests of capital and privatizing social services, including health care, transportation, education and public utilities, to gouge the public, that is the price of business. If reducing the cost of labor means forcing workers to remain unorganized and abolishing work, health and safety regulations, if it means moving industry overseas where foreign workers toil like 19th-century serfs, if it means suppressing wages at home to force an impoverished population into debt peonage, that is the price of business.
It is not accidental that the United States now has the worst income inequality since the 1920s. This was engineered by the capitalist class. But what Business Roundtable’s Aug. 19 statement reveals is that the capitalists are frightened they have been found out. Capitalism free of external restraints and with no internal restraints will pillage and exploit a captive population until it rises up in fury. It is such an eruption that today’s capitalists worry is on the horizon.
Capitalism, because it is such a socially destructive force, saturates the media landscape with advertising to misinform and manipulate the public. It uses its vast wealth to buy up the press, domesticate universities, nonprofits and think tanks and demonize and muzzle its critics. It funds pseudo-intellectuals and pseudo-economists who tirelessly propagate the ideology of neoliberalism, the belief that transferring wealth upward into the hands of the ruling oligarchs is beneficial to society. It forms global monopolies that prey on the public. It wages endless wars in its quest for profit. It equates anti-capitalist agitation with terrorism, meaning, for example, that anyone in the U.S. who attempts to photograph or film the savagery and cruelty of industrial agriculture—one of the primary causes of carbon emissions—can be charged under terrorism acts. And when its pyramid schemes, frauds and financial bubbles collapse, it loots the national treasury and leaves taxpayers with the bill. (In the U.S. economic crisis of 2008, corporations gobbled up $4.6 trillion in public money.)
Capitalism, as Karl Marx understood, if unregulated and unfettered, is a revolutionary force. It first creates a mafia economy, as Karl Polanyi wrote, and then a mafia government. It was the greed of the capitalist class that turned our cities in decaying hulks and impoverished more than half the country. It was the greed of the capitalist class that set us on a course of ecocide. It was the greed of the capitalist class that created the mechanisms of internal repression, including police that function as rogue paramilitary units in our internal colonies, wholesale surveillance of the public, a vastly expanded system of mass incarceration and the agencies, including the National Security Agency, Homeland Security and the FBI, that spy on the public to thwart resistance. It was the greed of the capitalist class that dismantled the democratic institutions of the United States. It was the greed of the capitalist class that gave us Donald Trump. This disdain for the common good and democracy makes these capitalists traitors.
Jamie Dimon, chairman and CEO of JPMorgan Chase and chairman of Business Roundtable, conceded in the press release containing the “Statement on the Purpose of a Corporation” that “the American dream is alive, but fraying.” He assured us, however, that “major employers are investing in their workers and communities because they know it is the only way to be successful over the long term. These modernized principles reflect the business community’s unwavering commitment to continue to push for an economy that serves all Americans.”
Alex Gorsky, chairman of the board and chief executive officer of Johnson & Johnson and chair of the Business Roundtable Corporate Governance Committee, added that the statement “affirms the essential role corporations can play in improving our society.”
Darren Walker, the president of the Ford Foundation, called the statement “tremendous news” and said it would “result in shared prosperity and sustainability for both business and society.”
The sententious and self-congratulatory passages in the statement can be summed up by the opening paragraphs:
Americans deserve an economy that allows each person to succeed through hard work and creativity and to lead a life of meaning and dignity. We believe the free-market system is the best means of generating good jobs, a strong and sustainable economy, innovation, a healthy environment and economic opportunity for all.
Businesses play a vital role in the economy by creating jobs, fostering innovation and providing essential goods and services. Businesses make and sell consumer products; manufacture equipment and vehicles; support the national defense; grow and produce food; provide health care; generate and deliver energy; and offer financial, communications and other services that underpin economic growth.
Capitalists such as Dimon (net worth $1.4 billion), whose company has paid more in regulatory fines than any other in America, and Gorsky, whose corporation was charged with helping fuel Oklahoma’s opioid crisis and then ordered by a court to pay $572 million in restitution in that state, would, in a functioning democracy, be in prison. Johnson & Johnson, Purdue Pharma, Pfizer and McKesson together are responsible for the deaths of many thousands of Americans—more than 130 people died every day in the U.S. from opioid-related drug overdoses in 2016 and 2017, according to the federal government.
The financial crimes of Dimon alone are numerous and notorious. They include underwriting fraudulent securities in the years leading up to the 2008 financial crash, overcharging members of the military on mortgages and mortgage refinancing transactions, overcharging customers for overdraft fees, manipulating bidding on California and Midwest electricity markets, overcharging homeowners for flood insurance, billing customers for nonexistent credit card monitoring services, charging minorities higher rates and fees on mortgages than those paid by white borrowers and failing to pay overtime to company workers.
So, what is this statement—which is equivalent to Al Capone insisting the mob ran a benevolent society in Chicago—about?
It is about the capitalists running scared. They know the reigning ideology of neoliberalism no longer has any credibility. Its lies have been exposed. They know the ruling institutions, including the legislative, executive and judicial branches of government, are dysfunctional and despised. They know the media, Wall Street and the big banks are distrusted and hated. They know the criminal justice system, which criminalizes poverty and legalizes corporate fraud, is a sham. They know social mobility is, in effect, nonexistent. And, most importantly, they know that the financial system, built on the scaffolding of trillions lent to them by the government at marginal interest rates, is not sustainable and will trigger another recession, if not a depression. They also know they are to blame.
The capitalists are determined to protect their wealth. They are determined, and probably able, to block left-leaning candidates Elizabeth Warren and Bernie Sanders from obtaining the Democratic nomination for president. But they are also aware that politicians such as Hillary Clinton, Nancy Pelosi, Chuck Schumer and Joe Biden who have spent their careers serving corporate power are harder and harder to sell to the electorate. The mendacity and hypocrisy of the Democratic Party are evident in the presidency of Barack Obama, who ran as an outsider and reformer in the wake of the 2008 financial meltdown. Obama—whom Cornel West called “a black mascot for Wall Street”—callously betrayed the party’s base. Actions by him, Clinton and other Democratic leaders after the 2008 financial debacle opened the door for the demagogue Donald Trump, who, although a con artist and inveterate liar, was astute enough to tell voters, especially from the white working class, what they wanted to hear.
Business Roundtable’s August statement is a pathetic attempt to reframe the capitalists’ roles in society, to give these corporate grifters gentler, kinder faces. It will not work. The capitalists have the power to destroy, but no longer to create. And out of their relentless destruction, which they are incapable of halting, will come the social unrest they fear and monstrosities more terrifying than Donald Trump.