George W. Bush and Donald Rumsfeld: Closet Socialists (Photo credit: Wikipedia)

By Ben Cohen: Listening to the rhetoric of Republicans, you’d believe they wouldn’t have the government do anything other than go to war on behalf of the American people (and sometimes even that isn’t true – Donald Rumsfeld spent years trying to privatize the military). Republicans believe healthcare, roads, education, and the environment can all be better taken care of with free markets, and they work around the clock to prevent government getting involved with pretty much anything.

The problem is, when free markets don’t work out so well for any of the industries that pay for their campaigns, Republicans become born again socialists and use government to redistribute as much wealth as they possibly can.

When the economy fell off a cliff in 2008 due to the housing market collapse, George Bush turned from free market evangelist to big government spender in the blink of an eye. “I’m a strong believer in free enterprise, so my natural instinct is to oppose government intervention,” said Bush when asking Congress to pass a $700 billion bailout package. “These are not normal circumstances. The market is not functioning properly. There has been a widespread loss of confidence. Without immediate action by Congress, America can slip into a major panic.”

Apparently understanding the concept that without government spending the nation could face, in his words, a “long and painful recession,” Bush urged Congress to pass the package without asking any questions.

What the president announced yesterday, is that somehow magically, if we just continue to prime the pump of taxpayer dollars, we’re going to see magically an economic recovery.

Indonesia had a huge financial crisis about ten years ago, and the instructions were the standard ones: “Here is what you have to do. First, pay off your debts to us. Second, privatize, so that we can then pick up your assets on the cheap. Third, raise interest rates to slow down the economy and force the population to suffer, you know, to pay us back.” Those are the regular instructions the IMF is still giving them.

What do we do? Exactly the opposite. We forget about the debt, let it explode. We reduce interest rates to zero to stimulate the economy. We pour money into the economy to get even bigger debts. We don’t privatize; we nationalize, except we don’t call it nationalization. We give it some other name, like “bailout” or something. It’s essentially nationalization without control. So we pour money into the institutions. We lectured the third world that they must accept free trade, though we accept protectionism.

Faced with empirical evidence that America is basically a socialist country that redistributes wealth upwards, one would have thought members of the media or political classes would stop lecturing everyone else on the virtues of the free market. But Mitt Romney, an original supporter of the bank bailouts and stimulus package under Bush, is running on an austerity platform for the Presidential election this year, because apparently, that’s best for the economy. Amazingly, Romney actually told the truth about austerity in a rare moment of candor in an interview with Mark Halperin in Time magazine. Here’s the exchange:

Halperin: Why not in the first year, if you’re elected — why not in 2013, go all the way and propose the kind of budget with spending restraints, that you’d like to see after four years in office? Why not do it more quickly?

Romney: Well because, if you take a trillion dollars for instance, out of the first year of the federal budget, that would shrink GDP over 5%. That is by definition throwing us into recession or depression. So I’m not going to do that, of course.

Romney then walked back the statement continuing his line that austerity was the only way forward, no doubt realizing his party and financial backers would be having serious words with him afterwards.

As Upton Sinclair famously wrote, “It is difficult to get a man to understand something, when his salary depends on his not understanding it.” Sadly, in Romney case, he actually does.

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I received a fair few emails about my piece defending George Monbiot against Noam Chomsky, most of them supporting Chomsky’s point of view. My take was pretty one sided – I believe that Chomsky was way off the mark and was completely unfair to Monbiot, who was asking him a relatively straight forward question that Chomsky didn’t seem to want to answer.

A friend of mine, Jan Frel (former editor of Alternet) engaged in a conversation with me about the article on the comments section, and I think he brought up some pretty good points. I will always look for ways to be lenient with Chomsky given his extraordinary contribution to human knowledge, and I think Jan’s explanation at least helps understand Chomsky’s side. Here’s the dialogue:

Jan: Monbiot is good sometimes, fishy others. I emailed him some simple questions about his support for the nuclear industry after he endorsed it, and he couldn’t answer them, as in: he didn’t. Monbiot disappoints often, but is also often good. Chomsky, at age 82 or whatever he is, I have a lot of charity for, especially on the question of genocide, especially when it comes to questions of genocide in former Yugoslavia, since there is an ongoing geopolitical campaign to overstate the number of corpses created there. There’s a lot of back story on that one, and one constant trend is to instill in our memories that pre-NATO/US political-military intervention, there was the potential for enormous horrific bloodshed, and that this was in full swing until the US came in there.

Me: Interesting point Jan – I do agree that Chomsky is worthy of a lot of charity – he’s done an inhuman amount of good work and can be forgiven for taking his eyes off the ball at his age. I just think that this time, he was way off the mark and was clearly not answering Monbiot’s questions because he probably knew he was wrong.

Jan: Right, there is that point that the guy may well not have read the book, but there’s a fairly involved history here. It becomes apparent if you watch a handful of Chomsky talks on YouTube and his article archive on Chomsky.info, and his essays available on Nexis on state terror and genocide denial and the fairly sophisticated and counter intuitive methods of undermining scholarly work on the topic that he and his colleagues endured since he got in the business starting with Vietnam, proceeding to East Timor, and then in Nicaragua and beyond. Scholars and journalists did employ exactly the method that Monbiot did, and many of its cousins, and when Chomsky was fully on his game, he refuted them. At this point it’s probably reflexive for Chomsky to respond the way he did, and meanwhile, he very well may not have read the book he blurbed, which is quite a common thing. I think Chomsky felt secure about the book because he and Herman did a book together I believe.

I think Jan is probably right – I’ve seen Chomsky refute a lot of journalists for completely ignoring the crimes of their own country while focusing on those on the ‘official enemies’ list (his take down of the BBC’s Andrew Marr for example, was absolutely devastating) – and I think he just reverted to type when dealing with Monbiot. The thing is, he completely underestimated his subject and got caught out. Rather than back track and apologize, Chomsky continued his attack and came off looking petty and arrogant.

Still, it doesn’t undermine the work Chomsky has done over the years, and that’s why his spat with Monbiot is probably best put down to a bit of age weariness.

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Noam Chomsky: A rare case when the esteemed professor is clearly wrong. (Photo credit: Wikipedia)

I was extremely saddened to see a bad tempered back and forth between two  important intellectual figures, Noam Chomsky and George Monbiot over an article written by Monbiot on the definition of genocide. The two men, particularly Chomsky, have made enormous contributions to their respected fields and broadly speaking, they agree far more than they differ, making their public spat all the more disheartening.

To cut a long story short, Monbiot penned an article criticizing a book written by Left wing heroes Edward Herman and David Peterson on the misuse of the word ‘genocide’. Monbiot accused the writers of downplaying genocide in Rwanda and Srebrenica and had four genocide scholars take apart their thesis. It’s fairly devastating stuff, and Herman and Peterson’s book is exposed as having at the very least, some very serious flaws.

Noam Chomsky wrote the foreword for the book and Monbiot emailed to him to ask if he would distance himself from their work. What transpired was a pretty vicious back and forth that unfortunately exposed Chomsky for not actually having read the book. Chomsky then when to great lengths to deliberately avoid Monbiot’s questions through a mixture of convoluted logic and pointless counter attacks.

It’s an interesting dialogue between two formidably bright thinkers, and you do get to see how seriously they take their work. Reading both men is often like reading a maths equation – their logic is almost always flawless and their assertions substantiated with a wealth of evidence. But this time, Chomsky has seriously let himself down and deserves to raked over the coals for his intellectual dishonesty. I felt a great deal of sympathy for Monbiot when reading it, as he was clearly pained to be at odds with a man he has described as a personal hero – a feeling I have myself as I type these words. I have dedicated a great deal of time reading Chomsky’s work, and I rarely find cause to disagree. However, reading his correspondence with Monbiot, I was shocked by his evasive, obfuscating responses that were not only demonstrably wrong, but extremely rude and dismissive.

Monbiot’s basic argument was that by putting his name, photograph and a foreword in a book that was using his credentials to sell copies, Chomsky was implicitly endorsing the academia inside it. Monbiot accused Chomsky of not actually reading the book either, and if you read between the lines, you’ll see that he most likely didn’t. Here’s Chomsky on his support for the book:

I purposely mentioned only one aspect of the book, which I do think is important, particularly so because of how it is ignored: namely the vulgar politicization of the word “genocide,” now so extreme that I rarely use the word at all. The mass slaughter in Srebrenica, for example, is certainly a horror story and major crime, but to call it “genocide” so cheapens the word as to constitute virtual Holocaust denial, in my opinion. It amazes me that intelligent people cannot see that.

Chomsky’s argument was that he wasn’t endorsing the facts in the book, merely supporting the thesis that the term ‘genocide’ is overused in intellectual circles and can grossly distort history. Chomsky also accused Monbiot of willfully ignoring more serious cases of genocide and focusing on smaller ones because he is part of  a cultish liberal elite:

Did you read my article before writing about it? If not, then we can drop the discussion. If you did, then you know that it brought up colossal cases of genocide denial, vastly beyond anything that concerns you, and vastly more important as well for obvious reasons. I’ll keep just to the one case we’ve discussed – there are others — but that you don’t seem to comprehend, for reasons that escape me: the denial of the slaughter of tens of millions in the Western hemisphere, about 10 million in the territorial US alone.

As to why it’s vastly more important than what concerns you, the reasons should be clear. First, the denial of genocide appears (without a single published reaction) in one of the most prominent intellectual journals of left-liberalism; so we are discussing easy tolerance of denial of colossal genocide (by “our side”) by your associates and friends.

If you’re confused, here’s what I think Chomsky is trying to say: Liberal commentators focus on small and basically irrelevant crimes committed by foreign despots because it detracts from the major crimes their own countries have, or are committing.

This is where Chomsky’s argument completely falls apart. Monbiot wasn’t in anyway disagreeing with this assertion – in fact, he agreed and provided multiple links to his own articles arguing the same point. Monbiot was simply saying that regardless of who commits the crime, it is still a crime and should be treated accordingly. Just because the crimes in Rwanda and Srebrenica may pale in comparison to the genocide of Native Americans (and that’s still debatable) doesn’t mean they aren’t important and Western journalists can’t draw attention to them.

Here’s Monbiot’s response (NB: the points are not in exact chronological order – I’ve edited to give the general thrust of the back and forth):

I understand your point about the vulgarization of the term genocide. But I contend that it has a specific and well-understood meaning: acts committed with intent to destroy, in whole or in part, a national, ethnic, racial or religious group. The intent behind the crime bears no necessary relationship to its scale or success. In fact far greater mass atrocities, in terms of the numbers killed, have been committed which do not meet the strict definition of genocide. But this does not mean that they shouldn’t be exposed and prosecuted as rigorously as genocide is. – You say that what I have published on this topic illustrates “the reigning moral/intellectual culture in which we largely live”, in which the crimes of the West are minimised or dismissed and those of its opponents are magnified. I believe that this can only be a wilful mischaracterisation of my work. I know that you are, or were, aware of what I have published on this topic: we have discussed it in person, and you congratulated me on it….

I asked you whether you would make a statement distancing yourself from the demonstrably false claims in Herman and Peterson’s book. You replied “No, I won’t. It would be sheer cowardice.” On the contrary, it would be an act of courage. Taking on allies is a far tougher call than taking on opponents, as I’ve found whenever I have done so – indeed as I find right at this moment, as I argue with a man whom I have admired perhaps more than anyone else on earth. But doesn’t intellectual honesty sometimes mean that it is necessary? Should our principles not be consistent, whoever they might offend?

Without responding to any of Monbiot’s questions, Chomsky instead chose to attack Monbiot on his use of the term ‘implicit endorsement’, somehow finding a way of comparing writing a clearly supportive foreword in a book to the denial of genocide by omission:

In your (disparaging) published comments you mention absolutely none of this [the genocide of Native Americans]. Therefore, adopting your concept (not mine) of “implicit endorsement” you endorse denial of horrendous crimes that is incomparably worse than anything that you focus your attention on. And when this is repeatedly brought to your attention, you still don’t see it.

After this extraordinary leap of logic, Monbiot chose to stop the correspondence, writing:

At this point, faced with Professor Chomsky’s repeated and apparently wilful failure to grasp the simple points I was making or answer the simple questions I was asking, I almost lost the will to live.

And as a huge fan of Noam Chomsky, I almost did too.

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Noam Chomsky: An advocate of Latin American independence (Photo credit: Wikipedia)

By Ben Cohen: The popularity of austerity in America and most of the industrialized world has revealed the truth about how modern economics works: Economies are beholden to banking institutions and have little control over their own destinies. Austerity measures are not working, but because the financial system dictates that the measures must be followed, governments have little choice other than to take orders. Who controls the money controls policy, and through debt the banks literally have the world at their feet. The popular uprisings across the European continent and the election of a socialist in France are a sign that the dynamics are changing, but there is an uphill struggle and no guarantees that the power of financial institutions can be reigned in.

If the supposed enlightened nations want to know what a future without the dictatorship of banks looks like, they’d do well to look at Latin America where popularly elected governments are working diligently to control their own destinies. Here’s Noam Chomsky talking about the extraordinary changes happening on the continent that have either been ignored or vilified in the western press:

What’s happened in Latin America in the last 10 years is just spectacular. I mean, in the last 10 years, for the first time in—since the Spanish and Portuguese conquerors—that’s half a millennium—Latin America has freed itself, substantially freed itself from Western domination and control, meaning mainly U.S……

U.S. and Canada are isolated in the hemisphere. And in fact, there’s a new organization, just formed about a year ago, CELAC, which formally excludes the U.S. and Canada, includes everyone else. It’s quite possible that that may replace the Organization of American States, which is U.S.-run. One sign of it is the U.S. has been essentially kicked out of its military bases in South America. They’re also moving towards dealing with some of their internal problems, which are severe.

And the other thing that’s exciting there is the role of popular movements. I mean, there are mass popular movements of indigenous people, working people, others who have just been—you know, who have been extremely successful in substantially changing policy. That’s of historic significance.

As Francesca Ghersenti of International Democracy Watch notes, CELAC (Community of Latin American and Caribbean States) was created at an interesting time:

The creation of CELAC comes at a specific historical juncture, in which the Western countries are facing extreme economic and financial difficulties. Contrary to this, Latin America is experiencing an economic boom and restored cultural and identity due to the 200th independence anniversary. As a result, it could be the economic and financial crises and the historical moment themselves to be speeding up and strengthening the process towards strong regional integration.

In fact, the CELAC economic agenda expects to consolidate integration and social inclusion as a way to maintain economic growth and protect the continent form the current financial crises.

CELAC has proposed a “new international financial architecture,” more specifically the creation of a reserve funds bank that would guarantee stable source of funding for the Latin American countries. Predictably, the US media’s response to CELAC was less than enthusiastic. As Alex Main form the Center for Economic Policy and Research writes:

The minimal coverage that the summit garnered in the U.S. media was mostly limited to reports that downplayed the significance of the new regional bloc.  It was depicted in some articles as “Chávez’s baby” and – according to one U.S. pundit – “will probably last as long as Chávez is willing to underwrite it.”  Miami Herald columnist Andres Oppenheimer insisted in a headline that the “Group will have no Teeth.” Based on conversations with a White House official and a representative of a right-wing Latin American government, Oppenheimer was able to determine with certainty that CELAC “will hardly make it into the history books.”

Contrary to those reports, Main argues the organization has some very significant and historic momentum behind it:

There is a new geopolitical reality south of the Rio Grande which has created a fertile terrain for deep and effective Latin American and Caribbean integration.

Only a decade ago, nearly all of the governments of the region embraced the Washington Consensus dogma of free markets, deregulation, privatization and the downsizing of the state and its role in the economy.  By the early 2000s, however, the tide turned as the peoples of the region went to the ballot boxes and overwhelmingly rejected policies that had led to stagnant economic growth, increased inequalities, and decreased access to education, healthcare and other public services.

Having suffered centuries of colonialism, invasion, and economic strangulation, Latin American countries are beginning to take their future into their own hands and creating financial structures that work for people rather than banks. They are doing it by electing politicians who refuse to endorse neo liberalism or take orders from financial institutions – and looking at the regions staggering growth rate, it is working.

And if it is working in Latin America, there’s no reason it can’t work here.

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Chomsky: A big supporter of OWS (Photo credit: Wikipedia)

This is a transcript of a discussion between Occupy Wall St supporters Mikal Kamil and Ian Escuela and Professor Noam Chomsky:

Professor Chomsky, the Occupy movement is in its second phase. Three of our main goals are to: 1) occupy the mainstream and transition from the tents and into the hearts and the minds of the masses; 2) block the repression of the movement by protecting the right of the 99%’s freedom of assembly and right to speak without being violently attacked; and 3) end corporate personhood. The three goals overlap and are interdependent.

We are interested in learning what your position is on mainstream filtering, the repression of civil liberties, and the role of money and politics as they relate to Occupy and the future of America.

Coverage of Occupy has been mixed. At first it was dismissive, making fun of people involved as if they were just silly kids playing games and so on. But coverage changed. In fact, one of the really remarkable and almost spectacular successes of the Occupy movement is that it has simply changed the entire framework of discussion of many issues. There were things that were sort of known, but in the margins, hidden, which are now right up front – such as the imagery of the 99% and 1%; and the dramatic facts of sharply rising inequality over the past roughly 30 years, with wealth being concentrated in actually a small fraction of 1% of the population.

For the majority, real incomes have pretty much stagnated, sometimes declined. Benefits have also declined and work hours have gone up, and so on. It’s not third world misery, but it’s not what it ought to be in a rich society, the richest in the world, in fact, with plenty of wealth around, which people can see, just not in their pockets.

All of this has now been brought to the fore. You can say that it’s now almost a standard framework of discussion. Even the terminology is accepted. That’s a big shift.

Earlier this month, the Pew foundation released one of its annual polls surveying what people think is the greatest source of tension and conflict in American life. For the first time ever, concern over income inequality was way at the top. It’s not that the poll measured income inequality itself, but the degree to which public recognition, comprehension and understanding of the issue has gone up. That’s a tribute to the Occupy movement, which put this strikingly critical fact of modern life on the agenda so that people who may have known of it from their own personal experience see that they are not alone, that this is all of us. In fact, the US is off the spectrum on this. The inequalities have risen to historically unprecedented heights. In the words of the report: “The Occupy Wall Street movement no longer occupies Wall Street, but the issue of class conflict has captured a growing share of the national consciousness. A new Pew Research Center survey of 2,048 adults finds that about two-thirds of the public (66%) believes there are “very strong” or “strong” conflicts between the rich and the poor – an increase of 19 percentage points since 2009.”

Meanwhile, coverage of the Occupy movement itself has been varied. In some places – for example, parts of the business press – there has been fairly sympathetic coverage occasionally. Of course, the general picture has been: “Why don’t they go home and let us get on with our work?” “Where is their political programme?” “How do they fit into the mainstream structure of how things are supposed to change?” And so on.

And then came the repression, which of course was inevitable. It was pretty clearly coordinated across the country. Some of it was brutal, other places less so, and there has been kind of a stand-off. Some occupations have, in effect, been removed. Others have filtered back in some other form. Some of the things have been covered, like the use of pepper spray, and so on. But a lot of it, again, is just, “Why don’t they go away and leave us alone?” That’s to be anticipated.

The question of how to respond to it – the primary way is one of the points that you made: reaching out to bring into the general Occupation, in a metaphorical sense, to bring in much wider sectors of the population. There is a lot of sympathy for the goals and aims of the Occupy movement. They are quite high in polls, in fact. But that’s a big step short from engaging people in it. It has to become part of their lives, something they think they can do something about. So it’s necessary to get out to where people live. That means not just sending a message, but if possible, and it would be hard, to try to spread and deepen one of the real achievements of the movement that doesn’t get discussed much in the media – at least, I haven’t seen it. One of the main achievements has been to create communities – real functioning communities of mutual support, democratic interchange, care for one another, and so on. This is highly significant, especially in a society like ours in which people tend to be very isolated and neighbourhoods are broken down, community structures have broken down, people are kind of alone.

There’s an ideology that takes a lot of effort to implant: it’s so inhuman that it’s hard to get into people’s heads, the ideology to just take care of yourself and forget about anyone else. An extreme version is the Ayn Rand version. Actually, there has been an effort for 150 years, literally, to try to impose that way of thinking on people.

During the onset of the industrial revolution in eastern Massachusetts, mid-19th century, there happened to be a very lively press run by working people, young women in the factories, artisans in the mills, and so on. They had their own press that was very interesting, very widely read and had a lot of support. And they bitterly condemned the way the industrial system was taking away their freedom and liberty and imposing on them rigid hierarchical structures that they didn’t want. One of their main complaints was what they called “the new spirit of the age: gain wealth forgetting all but self”. For 150 years there have been massive efforts to try to impose “the new spirit of the age” on people. But it’s so inhuman that there’s a lot of resistance, and it continues.

One of the real achievements of the Occupy movement, I think, has been to develop a real manifestation of rejection of this in a very striking way. The people involved are not in it for themselves. They’re in it for one another, for the broader society and for future generations. The bonds and associations being formed, if they can persist and if they can be brought into the wider community, would be the real defence against the inevitable repression with its sometimes violent manifestations.

How best do you think the Occupy movement should go about engaging in these, what methods should be employed, and do you think it would be prudent to actually have space to decentralise bases of operation?

It would certainly make sense to have spaces, whether they should be open public spaces or not. To what extent they should be is a kind of a tactical decision that has to be made on the basis of a close evaluation of circumstances, the degree of support, the degree of opposition. They’re different for different places, and I don’t know of any general statement.

As for methods, people in this country have problems and concerns, and if they can be helped to feel that these problems and concerns are part of a broader movement of people who support them and who they support, well then it can take off. There is no single way of doing it. There is no one answer.

You might go into a neighbourhood and find that their concerns may be as simple as a traffic light on the street where kids cross to go to school. Or maybe their concerns are to prevent people from being tossed out of their homes on foreclosures.

Or maybe it’s to try to develop community-based enterprises, which are not at all inconceivable – enterprises owned and managed by the workforce and the community which can then overcome the choice of some remote multinational and board of directors made out of banks to shift production somewhere else. These are real, very live issues happening all the time. And it can be done. Actually, a lot of it is being done in scattered ways.

A whole range of other things can be done, such as addressing police brutality and civic corruption. The reconstruction of media so that it comes right out of the communities, is perfectly possible. People can have a live media system that’s community-based, ethnic-based, labour-based and [reflecting] other groupings. All of that can be done. It takes work and it can bring people together.

Actually, I’ve seen things done in various places that are models of what could be followed. I’ll give you an example. I happened to be in Brazil a couple of years ago and I was spending some time with Lula, the former president of Brazil, but this was before he was elected president. He was a labour activist. We travelled around together. One day he took me out to a suburb of Rio. The suburbs of Brazil are where most of the poor people live.

They have semi-tropical weather there, and the evening Lula took me out there were a lot of people in the public square. Around 9pm, prime TV time, a small group of media professionals from the town had set up a truck in the middle of the square. Their truck had a TV screen above it that presented skits and plays written and acted by people in the community. Some of them were for fun, but others addressed serious issues such as debt and Aids. As people gathered in the square, the actors walked around with microphones asking people to comment on the material that had been presented. They were filmed commenting and were shown on the screen for other people to see it.

People sitting in a small bar nearby or walking in the streets began reacting, and in no time you had interesting interchanges and discussions among people about quite serious topics, topics that are part of their lives.

Well, if it can be done in a poor Brazilian slum, we can certainly do it in many other places. I’m not suggesting we do just that, but these are the kinds of things that can be done to engage broader sectors and give people a reason to feel that they can be a part of the formation of communities and the development of serious programmes adapted to whatever the serious needs happen to be.

From very simple things up to starting a new socio-economic system with worker- and community-run enterprises, a whole range of things is possible. The more active public support there is the better defence there is against repression and violence.

How do you assess the goals of the Democratic party as far as co-opting the movement, and what should we be vigilant and looking out for?

The Republican party abandoned the pretence of being a political party years ago. They are committed, so uniformly and with such dedication, to tiny sectors of power and profit that they’re hardly a political party any more. They have a catechism they have to repeat like a caricature of the old Communist party. They have to do something to get a voting constituency. Of course, they can’t get it from the 1%, to use the imagery, so they have been mobilising sectors of the population that were always there, but not politically organised very well – religious evangelicals, nativists who are terrified that their rights and country are being taken away, and so on.

The Democrats are a little bit different and have different constituencies, but they are following pretty much the same path as the Republicans. The centrist Democrats of today, the ones who essentially run the party, are pretty much the moderate Republicans of a generation ago and they are now kind of the mainstream of the Democrat party. They are going to try to organise and mobilise – co-opt, if you like – the constituency that’s in their interest. They have pretty much abandoned the white working-class; it’s rather striking to see. So that’s barely part of their constituency at this point, which is a pretty sad development. They will try to mobilise Hispanics, blacks and progressives. They’ll try to reach out to the Occupy movement.

Organised labour is still part of the Democratic constituency and they’ll try to co-opt them; and with Occupy, it’s just the same as all the others. The political leadership will pat them on the head and say: “I’m for you, vote for me.” The people involved will have to understand that maybe they’ll do something for you, that only if you maintain substantial pressure can you get elected leadership to do things – but they are not going to do it on their own, with very rare exceptions.

As far as money and politics are concerned, it’s hard to beat the comment of the great political financier Mark Hanna. About a century ago, he was asked what was important in politics. He answered: “The first is money, the second one is money and I’ve forgotten what the third one is.”

That was a century ago. Today it’s much more extreme. So yes, concentrated wealth will, of course, try to use its wealth and power to take over the political system as much as possible, and to run it and do what it wants, etc. The public has to find ways to struggle against that.

Centuries ago, political theorists such as David Hume, in one of his foundations for government, pointed out correctly that power is in the hands of the governed and not the governors. This is true for a feudal society, a military state or a parliamentary democracy. Power is in the hands of the governed. The only way the rulers can overcome that is by control of opinions and attitudes.

Hume was right in the mid-18th century. What he said remains true today. The power is in the hands of the general population. There are massive efforts to control it by less force today because of the many rights that have been won. Methods now are by propaganda, consumerism, stirring up ethnic hatred, all kinds of ways. Sure, that will always go on but we have to find ways to resist it.

There is nothing wrong with giving tentative support to a particular candidate as long as that person is doing what you want. But it would be a more democratic society if we could also recall them without a huge effort. There are other ways of pressuring candidates. There is a fine line between doing that and being co-opted, mobilised to serve someone else’s interest. But those are just constant decisions and choices that have to be made.

This transcript was originally published on InterOccupy, an organization that provides links between supporters of the Occupy movement around the world.

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Noam Chomsky (Image via RottenTomatoes.com)

By Ben Cohen: When the massive economic crisis hit the US back in 2008, people struggled to understand how everything fell apart so quickly. Up until that point, the American economy was heralded by the media as a miraculous powerhouse embodying the principles of the free market and dynamic entrepreneurialism. The reality was that the economy was incredibly fragile and built on an insane amount of debt, mostly from the fraud ridden real estate bubble. Janitors were sold mortgages on multi million dollar mansions while the same lenders bet against them paying it off -  an illogical and highly irrational consequence of extreme deregulation in the finance industry. When the debt was called in and no one was there to cover the losses, the economy fell apart destroying the myth of American capitalism.

My own understanding of economics at the time was not deep enough to fully comprehend what was going on. I had always understood that the system was rigged in order to preserve wealth for the wealthy, but I had not been aware of the enormity of the corruption and the systemic flaws that led to a such a huge recession and the near collapse of the world economy.  In order to find out more, I got in contact with Professor Noam Chomsky, one of the clearest and most incisive economic thinkers around. As we approach yet another period of serious economic uncertainty – (this time stemming from the Euro Zone), I thought I’d re-post the interview as Chomsky’s analysis of the current economic paradigm and the history behind it is extremely useful in understanding why we continually face such enormous threats:

TDB:  What are your thoughts on the current economic crisis and the bail out bill that passed in the Senate?

NC: The crisis is real, it’s not manufactured. Exactly how serious it is, one doesn’t know. Some of the most credible specialists like Nuriel Rabbini who have a very good record of accurate prediction think it’s an extremely serious crisis and that the system might just freeze up. There is also a good deal of controversy about whether the current proposal will do more than put a band aid on a serious problem. Now there are alternatives, constructive alternatives. And they are being proposed, I mean, you can find them in the literature, but they are not on the agenda. It’s interesting, I mean the public is strongly opposed to the bailout, you can see that in the behavior of Congress, the House of Representatives where the Representatives come up for election in November voted it down, despite the enormous pressure. The Senate, which is kind of a millionaires club, where only a third of them come up for election, they passed it overwhelmingly. So the House did respond to a populist revolt. Superficially that looks like a sign of  a functioning democracy, but that’s only superficial. I mean even a dictatorship, when the public is rioting, the government will respond. In this case, the public’s reaction was resorting to shouting ‘No’.

In a democracy, in a functioning democracy, what would be happening is that popular organizations, unions, political groupings, others would be developing their programs, putting them forth, insisting that their representatives implement those programs. And there are possible programs that might make a difference, but none of this is happening. And the reason this isn’t happening is because there is no functioning democracy. The role of the public is restricted to shouting ‘No’. The bill passed in the House because the alternative was quite dire, but it doesn’t mean it was a good proposal, or by any means the best proposal.

I mean there are serious problems, and they have deep roots. The immediate problems were caused by the housing bubble that Alan Greenspan had permitted to explode. They could have controlled it on the basis of the kind of lunatic belief in free market fundamentalism. So they allowed this bubble to explode and the houses were way beyond their trend line, the actual realistic price. They’ve been collapsing, but they’ve got a long way to go. The Bush economy, which was like the Reagan economy, is very fragile, and is based on debt – lenders from abroad, and also consumer spending which is debt driven. Consumer spending was largely based on inflated house prices, essentially collateral, and as the house prices collapse, so does the basis for consumer spending, then the economy collapses because its not a well functioning real economy.

All this goes back more deeply to the financial liberalization back in the 1970s. Now financial liberalization is just a catastrophe waiting to happen, and there are very well understood reasons for that. Markets have built in inefficiencies, serious inefficiencies which are well known. One of them is that transactions in a market do not take into account what are called ‘externalities’, so if you and I make some sort of a deal , say you sell me a car, we may make an arrangement that is good for us, but we don’t take into account the costs for others. And there are costs, traffic jams, pollution, the price of gas, and so on. They may seem small, but they’re not. They add up and they can be quite large. In the case of financial institutions, they are very large. A financial institution has the task of taking risks, and if it’s a well run institution, say Goldman Sachs, it tries to cover the potential losses to itself, but only to itself. It does not take into account what is called systemic risk, the effects of its failure on the whole system. So that means risk taking is what’s called ‘under priced’ – you are not really taking into account the risks, the real risks when you look after only yourself, and that means there is a lot more risk taking than an efficient system would permit. And that’s bound to lead to crisis, and it has ever since financial liberalization was initiated back in the 70’s. There has been an increase in both the regularity and the scale of financial crises, and now a major one has hit and come home. So it was predicted and predictable, and it’s now serious.

TDB: Does the nationalization of Fannie Mae and Freddy Mac and the enormous bailout on Wall Street represent an end to Laissez Faire capitalism?

NC: It’s not an end to Laissez Faire capitalism because it never existed! The nationalization is very dramatic right now, its all over the front pages, but the fundamental principle that the public takes the risks and pays the costs while profit is privatized, that principle which we are seeing dramatically right now, that’s a basic principle for the whole economy. I mean, the whole advanced economy is based on that principle. The state sector of the economy, which is dynamic and the source of much of the innovation and development that underlies the advanced economy, that is the system in which the public pays the cost and takes the risks, and profits are ultimately privatized. Take say, computers and the internet. They were pretty much in the state system for decades before they were handed over to a private enterprise to make profit from, and virtually everything you look at in the advanced economy and the cutting edge economy works like that. I mean there is now talk in the press, commentators talk about the socialization of risk and cost and privatization of profit, but they are talking about it as if it is something new, and a blow to laissez faire capitalism. It’s not new. That’s the way the system works, and has worked for centuries.

TDB: What did you think of Ron Paul and his brand of old style Repblican libertarianism? Was his philosophy based on mythology?

NC: It’s based on a myth if it assumes there was ever a free enterprise, or market economy that did not have critical state intervention. I mean there are societies that have real market economies. That’s what we call the Third World. They have it rammed down their throats by force. That’s part of the reason why they are the Third World. But the rich developed countries were always based on substantial intervention. I mean the mythology that is circulating now is mind boggling. I mean there is talk about Ronald Reagan the icon of free market capitalism, where on the congressmen said that ‘this bailout is putting a coffin on Reagan’s coffin”. Reagan was the most protectionist president in post war American history! He doubled protectionist barriers. He called on the Pentagon to initiate programs to teach backwards American managers modern Japanese style production techniques. He carried out one of the largest bailouts in American history, Continental Illinois. He may not have even known what the programs were, but his administration was a strong believer in large scale state intervention

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Paul Ryan: Author of the most 'Fraudulent Budget in American History' (Photo credit: Wikipedia)

By Ben Cohen: For 30 years, Republicans have espoused an economic theory that has wreaked havoc on America’s poor, funneled wealth upwards at an unprecedented rate and brought the economy to the brink of destruction. Their simple mantra that tax cuts for the rich and deregulation solve all of humanity’s problems is chanted religiously and has pervaded our culture to the point where opposing it has been seen as treason.

The corporate media has perpetuated this myth filling airtime with business and news shows and built on the assumption that neoliberalism is a fact and anything else doesn’t work. The result has been a debate so stifled that it took a monumental economic crisis to even consider there might be an alternative to the current monetary system.

Responding to public outrage, Democrats have begun to publicly question the dominant ideology, shifting debate back a little to the center. It hasn’t been inspiring, but they have at least created room to maneuver when it comes to crafting policy.

The Republican Party has been unable to accept any new view points because of one simple reason: It cannot afford to – at least up until now.

If a candidate on a national or state level wanted to run on a higher taxes and/or more regulation platform, the corporate interests that bankroll the party would simply throw all their money at the Democratic candidate. As it stands, they do that anyway, but continue to fund the Republican Party in the hope of more concessions should they get into power.

The problem is structural due to the disastrous effect of money in politics – with no campaign finance reform, donations from corporate America will continue to critically influence policy regardless of the outcome.

But there comes a point when the economic ideology becomes so dangerous that it stops being in anyone’s interest, including the corporations. It is now clear that that time has come, and corporate America can no longer support a system that no longer functions for their benefit. As Noam Chomsky writes:

The spectacle is even coming to frighten the sponsors of the charade. Corporate power is now concerned that the extremists they helped put in office may in fact bring down the edifice on which their own wealth and privilege relies, the powerful nanny state that caters to their interests.

The basic truth is as follows: Corporations need markets to sell their goods in, and if no one has jobs or money, there aren’t any markets to sell in. While they pretend to believe that tax cuts work in everyone’s interest, they know that results in reality show something completely different.

A remarkable survey last year showed that 68% of millionaires supported raising their own taxes – a clear sign that the owners of the country’s wealth are worried that their own survival is at stake if wealth isn’t distributed more evenly. But still, the Republicans refuse to acknowledge that anything needs to change.

Paul Ryan, the GOP’s economic ‘Wunder kid’ crafted a budget proposal passed by Republicans in the House of Representatives last week that Krugman labeled “The most fraudulent budget in American history”. He continued:

The trouble with the budget devised by Paul Ryan, the chairman of the House Budget Committee, isn’t just its almost inconceivably cruel priorities, the way it slashes taxes for corporations and the rich while drastically cutting food and medical aid to the needy. Even aside from all that, the Ryan budget purports to reduce the deficit — but the alleged deficit reduction depends on the completely unsupported assertion that trillions of dollars in revenue can be found by closing tax loopholes.

And we’re talking about a lot of loophole-closing. As Howard Gleckman of the nonpartisan Tax Policy Center points out, to make his numbers work Mr. Ryan would, by 2022, have to close enough loopholes to yield an extra $700 billion in revenue every year. That’s a lot of money, even in an economy as big as ours. So which specific loopholes has Mr. Ryan, who issued a 98-page manifesto on behalf of his budget, said he would close?

None. Not one. He has, however, categorically ruled out any move to close the major loophole that benefits the rich, namely the ultra-low tax rates on income from capital.

The math indicates that the budget would be a complete and utter disaster given they are based on nonsense. No sane party would put its name to something as ridiculous, but the GOP, including Presidential front runner Mitt Romney, has signed off on it with no qualms whatsoever.

It will be interesting to see how corporate donors line up during the general election. We could conceivably see corporate America and the rich line up behind Barack Obama and completely shun the GOP nominee – not because they want more taxes and regulation, but because they know they need it.

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Noam Chomsky breaks down the reasons for the US economic decline over the past four decades:

American decline entered a new phase: conscious self-inflicted decline. From the 1970s, there has been a significant change in the US economy, as planners, private and state, shifted it toward financialization and the offshoring of production, driven in part by the declining rate of profit in domestic manufacturing. These decisions initiated a vicious cycle in which wealth became highly concentrated (dramatically so in the top 0.1% of the population), yielding concentration of political power, hence legislation to carry the cycle further: taxation and other fiscal policies, deregulation, changes in the rules of corporate governance allowing huge gains for executives, and so on.Meanwhile, for the majority, real wages largely stagnated, and people were able to get by only by sharply increased workloads (far beyond Europe), unsustainable debt, and repeated bubbles since the Reagan years, creating paper wealth that inevitably disappeared when they burst (and the perpetrators were bailed out by the taxpayer).

I never truly understood economics until I read Chomsky, and I highly recommend reading his work if you want to understand the reality of modern capitalism. His analysis of the global financial system is astonishing to read as it elegantly lays out the structure of a fraudulent system built on inequality, debt and massive instability. Chomsky has a scientists mind, not an economists, so he avoids inside jargon and focuses on explaining core concepts in simple terms. You can go through an archive of his articles here, and I would suggest reading 'Understanding Power', a brilliant collection of interviews and lectures Chomsky has given over the past 20 years or so.

I've moved slightly away from Chomsky's views on foreign policy in recent times as I think his depiction of Western governments as cruel imperialists bent on destroying the third world is overly simplistic (not entirely wrong by any means though), but his writing on economics is unparalleled in my opinion.

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The trench warfare between Democrats and Republicans in Washington occurs over a very small piece of land, and the Democrats have been retreating off of it for about 30 years. Little by little, the Democrats have ceased to represent working people and now only offer up tidbits of social policy to help the very poorest Americans.

If you had the misfortune of watching the latest Republican 'debate', you would have noticed that the party now exclusively represent corporate America, wishing to turn as much of the country into a low wage labor market as is possible while ensuring wealth is kept in the hands of the elite. Mitt Romney's recent gaffe that 'corporations are people' reflects the pervading view of society inside the GOP, and his opponents only offer up a more extreme vision of market capitalism.

Given the Republicans control Congress and are willing to severely damage the country in order to pass their policies (as we saw with the debt ceiling debate), the resulting political paradigm is so dangerous that the government no longer has the ability to effect policy. Key decisions are now left in the hands of private power who seek only their own profit at whatever expense. Obama and the Democrats are struggling to contain extreme excesses of corporate capitalism, but with dwindling political capital and less leverage inside the system after the mid terms, it is an uphill battle.

The cost of essentially firing the referee has made the game inherently less stable and far more prone to collapse than ever before. As Noam Chomsky points out, this could spell the end of the American Republic as we know it:

Another common theme, at least among those who are not willfully blind, is that American decline is in no small measure self-inflicted. The comic opera in Washington this summer, which disgusts the country and bewilders the world, may have no analogue in the annals of parliamentary democracy.

The spectacle is even coming to frighten the sponsors of the charade. Corporate power is now concerned that the extremists they helped put in office may in fact bring down the edifice on which their own wealth and privilege relies, the powerful nanny state that caters to their interests.

It is incredible that the Republican party is now so extreme that it actually threatens its own interests – a sign of how fanatical it has become under pressure from players like Sarah Palin, Michelle Bachmann, Rick Perry and the Tea Party. So unwilling are they to even entertain raising taxes, they would sacrifice the financial standing of the country to its foreign and domestic debtors. This bizarre irony would be funny if it were only the GOP's survival at stake, but their power over the political system and ability to pevert the national debate means they will literally bring the house down with them should the decide to continue the deadly game.

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In a great interview with Chris Hedges, Ralph Nader explains why he thinks reform is virtually impossible without professional and sustained activist organization:

While protests are useful, Nader does not see any possibility for reform until there is a widespread effort to organize a sustained and radical opposition movement. This will come by building a movement that offers an alternative ideology and vision to that of unfettered capitalism, consumerism, empire and globalization. It is something Nader tried and failed to do during his own presidential campaigns.

“There is a tremendous asymmetry,” Nader said. “Seven hundred thousand people demonstrated in London. But where are they the next day? And where are their adversaries? The next day their adversaries are on the job. Where are the 700,000 people? They are out of there. How many organizers are on the ground in the 435 districts? Could labor unions have been organized without organizers? Could the suffragist movement have been organized without organizers? Could the anti-slavery movement or the civil rights movement been organized without organizers? If you don’t have organizers on the ground you know ipso facto that your demonstration is going nowhere.”

One major problem with activist organization in my opinion, is its branding. There simply hasn't been a movement that has caught the attention of the public, and often times, this comes down to perception. If advertisers can get us to spend thousands of dollars a year on different mp3 players that do exactly the same thing, it must be possible to create some sort of political movement that resonates with the younger generation. Too often, political activism is associated with unkempt hippies who smoke pot and don't like doing any work. This is of course completely unfair, but more needs to be done to change the image of the regular political activist. 

I've spent a lot of time talking to Republicans and mainstream Democrats, and they simply switch off when you mention people like Ralph Nader and Noam Chomsky. I'm a fan of both men, but recognize that their language is deeply unappealing to the educated middle classes. I'm not suggesting Nader, Chomsky or the progressive movement change their message, just their delivery of it. Writers like Naomi Klein do a good job of making progressive political analysis digestible to the mainstream. She doesn't shout, call people names or use hyperbole to characterize entire classes of people (something Chomsky and Nader are most definitely guilty of) and she manages to provide intelligent and seriously critical analysis. 

Nader is right – there is a desperate need for a serious alternative to the mainstream parties – it just needs to be appealing enough for people to get behind it.

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