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Global Power Project: The Group of Thirty, Financial Crisis Kingpins

Global Power Project: The Group of Thirty, Financial Crisis Kingpins

By: Andrew Gavin Marshall

25 February 2014

The following article was originally posted on 18 December 2013 at Occupy.com

Following parts onetwo and three of the Global Power Project’s Group of Thirty series, this fourth and final instalment focuses on a few of the G30 members who have played outsized roles both in creating and managing various financial crises, providing a window on to the ideas, institutions and individuals who help steer this powerful global group.

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The Assassin of Argentina

Prior to 2008, one of the most notable examples of a highly destructive financial crisis took place in Argentina which, heavily in debt, faced a large default and was brutally punished by financial markets and the speculative assault of global finance, otherwise known as “capital flight.” Less known in the story of Argentina’s 1998 to 2002 economic catastrophe was the significant role played by just one man: Domingo Cavallo.

A longtime member of the Group of Thirty, Cavallo formerly served both as Governor of the Central Bank and Minister of Economy in Argentina. He has been referred to  by Pulitzer Prize-winning economic researcher Daniel Yergin as “one of the most influential figures in recasting the relationship of state and marketplace in Latin America.”

Between 1976 and 1983, Argentina, ruled by a ruthless military dictatorship, was marred by excessive human rights abuses and persecution of intellectuals and dissidents during the so-called “Dirty War” in which as many as 30,000 people were killed or disappeared . The terror was reminiscent of nearby Chile, where a coup that brought dictator Augusto Pinochet to power in 1973, with the help of the CIA, provided a petri-dish experiment in the implementation of neoliberal “reforms.” It was Chile’s dictatorship that set the example, and Argentina’s soon followed.

In a 2002 interview, Domingo Cavallo noted that, “The experience of Chile during the ’80s was very instructive, I think, for most Latin American economies, and many politicians in Latin America, because Chile was successful by opening up and trying to expand their exports and in general their foreign trade and getting more integrated into the world economy… And of course we used, particularly here in Argentina, the experience of Chile to go ahead with our own reforms.”

Asked about the association between economic “reforms” in Chile and the ruthless dictatorship that implemented them, Cavallo explained, “There were discussions on the feasibility of implementing market reforms in a democracy. But in 1990… the first democratic president after Pinochet maintained the reforms and also tried to improve on them [and] it was demonstrated that itwould be possible  to implement similar reforms under a democratic regime.”

What specific reforms was Cavallo referring to? Under Argentina’s military dictatorship, Cavallo served for one year as Governor of the Central Bank in 1982, where he was responsible for implementing  a state bailout of corporations and banks. After, Cavallo returned to academic life. But all that changed with the election of Carlos Menem in 1989, who served as president until 1999. In 1991, Menem appointed Cavallo as Minister for Economy, a position he held until 1996.

Cavallo led the neoliberal restructuring of Argentina: pegging the Argentine peso to the U.S. dollar, trying to reduce inflation, undertaking massive privatizations while opening up the economy to “free trade,” and deregulating financial markets. The New York Times in 1996 heaped praise on Cavallo for his “constructive” role in leading the economy “back to vitality and international respectability,” despite the fact that his reforms “brought high unemployment  and painful reductions in social programs.”

Another NYT article credited Cavallo for the “stability” brought to Argentina through his “economic miracle,” while noting, without irony, that Cavallo’s miracle had “left million of Argentines… without a safety net” and with record-high unemployment, the emergence of urban slums, abandoned street children, over-crowded food banks, homeless shelters in churches, and even some people who were forced to eat cats in desperation. The “miracle” was so great, in fact, that despite all of the so-called stability it facilitated, President Menem ultimately dismissed Cavallo to the jubilation of tens of thousands of protesters in the streets. Though the people were pleased, financial markets expressed their disapproval .

With multiple economic and financial crises erupting around the world and in neighboring nations, Argentina, which pegged its currency to the U.S. dollar, found it could no longer compete. The touted neoliberal reforms were taking a toll as the country plunged into recession. Menem was replaced in 1999 by President Fernando De la Rua, who quickly sought support from the IMF to help repay the country’s debts owed to foreign – largely American  – banks.

But Cavallo wasn’t out. In 2001, he was re-appointed as the country’s Minister of Economy just in time to receive emergency powers enabling him handle the country’s ongoing financial crisis that he helped to create . At that point, financial markets felt Argentina could not be trusted to repay its debt and the IMF refused to provide further loans, on the basis that the country had not implemented enough neoliberal reforms to meet its demands. The economy crashed and the “much-hated” Cavallo had to resign, as did the President, who fled by helicopter from the Casa Rosada as Argentines protested en masse .

Even the Federal Reserve Bank of San Francisco noted in 2002 that there was “some truth” to the view that “Argentina’s debt position would have been sustainable if only market uncertainty had not triggered a crisis.” But, it added, had Argentina made the effort asked of it to reduce its debt, it could have avoided  “potentially destabilizing shifts in market sentiment.”

Domingo Cavallo

Domingo Cavallo

America’s Crisis-Causers

The role played by former Federal Reserve Chairman Alan Greenspan in creating the conditions that led to the 2008 global financial meltdown is known to many. What is less known is that Greenspan, too, is a former member of the Group of Thirty. Greenspan did not work alone, of course, in his efforts to deregulate the financial system and spur the growth of the derivatives markets, which laid the groundwork for the worst financial crisis in modern times. Larry Summers, who then served as deputy secretary and later Secretary of Treasury under Bill Clinton, was also very helpful in this regard. Summers, too, is a current member of the Group of Thirty.

Currently serving as President Emeritus and as a professor at Harvard University, Summers was the former director of President Obama’s National Economic Council from 2009 to 2011. Previously, he was President of Harvard (2001 to 2009) and, prior to his positions during the Clinton administration he was Chief Economist at the World Bank (1991 to 1993). Currently, Summers is a member not only of the G30 but of the Council on Foreign Relations, the Trilateral Commission, and he was also a member of the Steering Committee of the Bilderberg Group.

While Chief Economist at the World Bank, Summers signed an infamous 1991 memo in which it was suggested that rich countries should dump their toxic waste and pollutants in the poorest African nations — because by the time the toxins spurred the growth of cancer in the local population, they would already statistically be dead due to already high mortality rates. The memo noted : “I think the economic logic behind dumping a load of toxic waste in the lowest wage country is impeccable and we should face up to that.”

When Summers later went to work for the Clinton administration under Treasury Secretary Robert Rubin, he along with Rubin and Fed Chairman Greenspan formed the “Three Marketeers,” as Time referred to them, dedicated to  “inventing a 21st century financial system” where they placed their “faith [in] financial markets.”

In the final two years of the Clinton presidency, Summers served as the Treasury Secretary alongside his deputy and protégé, Timothy Geithner, another member of the G30 who would go on to make a mark on the financial crisis — largely by convincing President Obama to bail out the Wall Street banks that crashed the economy, with zero penalty to them. Under the Obama administration, Summers served for nearly two years as Chair of the National Economic Council and was a highly influential policymaker . In 2009, he had spoken at the highly influential ultra-conservative think tank, the Peterson Institute for International Economics, where he explained the administration’s approach to the economic recovery, noting that , “Our approach sought to go as much as possible with the grain of the market” as opposed to regulating markets.

When Summers left the Obama administration in late 2010, he returned to Wall Street and made a fortune  working for the hedge fund D. E. Shaw & Co. and Citigroup. This past summer, he was considered Obama’s favorite pick  to replace Ben Bernanke as Fed Chairman, but faced such stiff opposition within the Democratic Party that he withdrew his name, leaving Janet Yellen – the Vice Chair of the Fed and herself a former member of the Group of Thirty – to step in .

What we see, in this analysis of the Group of Thirty, are the connections between those in positions of power to respond to and manage economic and financial crises, and those in positions of power who created such crises. Naturally, as well, the G30’s membership includes numerous bankers who, as fortune had it, shared handsomely in the profits of those crises. Put simply, the G30 can be thought above all as an exclusive club of financial crisis kingpins. And it is a club, no doubt, that will continue to play a significant and not altogether helpful role in global financial management for years to come — or until something is done to stop them.

Andrew Gavin Marshall is a 26-year-old researcher and writer based in Montreal, Canada. He is project manager of The People’s Book Project , chair of the geopolitics division of The Hampton Institute, research director for Occupy.com’s Global Power Project and the World of Resistance (WoR) Report, and hosts a weekly podcast show with BoilingFrogsPost .

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“A Lot of People Believe This Stuff”: Bill Clinton, Barack Obama, and the Politics of Public Relations

“A Lot of People Believe This Stuff”: Bill Clinton, Barack Obama, and the Politics of Public Relations

By: Andrew Gavin Marshall

“Political language… is designed to make lies sound truthful and murder respectable, and to give an appearance of solidity to pure wind.” – George Orwell, “Politics and the English Language,” 1946

“It’s important, because a lot of people believe this stuff.”  – Bill Clinton, speaking at the Democratic National Convention, 5 September 2012

In case you were unaware, Bill Clinton gave a speech at the Democratic National Convention on the evening of September 5, which, the media tells us, revealed Clinton’s “special gift”[1] to “give a boost to Obama’s middle-class hero image.”[2] The speech has been hailed as Clinton’s “come back,”[3] and a “spirited defense” of Obama..[4] The “rock star,”[5] Bill Clinton, received heaps of praise from celebrities who endorsed his speech, and it’s obviously very important that the public know what Whoopi Goldberg, Chris Rock, and Alicia Silverstone think of the speech, so lucky for us, the media tells us. It was, “fantastic… common sense,” that Clinton was “up there teaching,” and “breaking it down.”[6]

But it’s also important that the public receive more ‘expert’ analysis from political commentators and reporters, so CNN reporter Wolf Blitzer explained that he had been watching Clinton since 1992 when he was CNN’s White House correspondent, and that, “[t]his may have been the best speech I have ever heard Bill Clinton deliver,” while GOP strategist Alex Castellanos proclaimed, “This will be the moment that probably re-elected Barack Obama.” Brit Hume on Fox News (“fair and balanced”) said that Clinton, “is the most talented politician I’ve ever covered and the most charming man I’ve ever met… No one in my view can frame an argument more effectively than he can.” Anderson Cooper shared his wisdom and analysis, explaining that, “[t]he level of detail in the speech was quite surprising… and yet there was a personality.” Chris Matthews on MSNBC chimed in, “I wouldn’t want to be the guy fighting Bill Clinton if the issue is Barack Obama.” But of course, there was some “intelligent criticism” of the speech within the media, so it wasn’t all praise. For example, John King of CNN noted that the speech could “use an editor,” because as various other critics noted, it was “too long.”[7]

So what exactly did Bill Clinton say that was so inspiring and praiseworthy? Well, he went up on stage, and for fifty minutes, successfully achieved the highest degree of hypocrisy possible. His speech could not have been better constructed if it had been written by a public relations firm, itself. And perhaps it was. After all, it’s not that the Clinton’s don’t have a cozy relationship with public relations firms, as Burson-Marsteller, the most prominent PR firm in the United States, ran Hillary Clinton’s failed presidential campaign in 2008.[8] The firm is venerable and highly respected, and has built a very prominent resume of individuals and institutions it has represented, such as Ceausescu in Romania, the Saudi royal family, the Nigerian government when it wanted to discredit claims of genocide during the Biafran war, the Argentine dictatorship which killed roughly 35,000 of its own people, the Indonesian government as it committed genocide in East Timor (ultimately eliminating a third of the entire population while Bill Clinton armed it to do so). Burson-Marsteller also represented Union Carbide following the Bhopal gas leak that killed 15,000 people in India, among other reputable clients.[9]

Controlling the “Bewildered Herd” of “Ignorant and Meddlesome Outsiders”

I mention the public relations industry, because elections are essentially run by the PR industry, and public relations is the officially-sanctioned term for “propaganda.” It is no small coincidence that the founder of the public relations industry, a man named Edward Bernays, also happened to have literally written the book on Propaganda (1928), in which he wrote, “The conscious and intelligent manipulation of the organized habits and opinions of the masses is an important element in democratic society. Those who manipulate this unseen mechanism of society constitute an invisible government which is the true ruling power of our country.” He added: “it remains a fact that in almost every act of our daily lives, whether in the sphere of politics or business, in our social conduct or our ethical thinking, we are dominated by the relatively small number of persons… who understand the mental processes and social patterns of the masses. It is they who pull the wires which control the public mind, who harness old social forces and contrive new ways to bind and guide the world.” Naturally, explained Bernays, this is merely “a logical result of the way in which our democratic society is organized.”[10]

Bernays of course had experience. In 1917, he was asked by President Woodrow Wilson to join the Committee on Public Information (CPI), a propaganda agency created by the government to rally the American population to support entering World War I, which was popularly perceived at the time as “a rich man’s war.” The CPI was highly successful, and the American people went to war. Bernays and the other propagandists who were involved were so impressed with their manipulation of the public during war-time, that they felt they could do it during peace time as well. Thus, after the war, Bernays soon founded one of the first PR firms in the United States. Walter Lippmann, the most influential intellectual in the United States at that time, encouraged President Wilson to create the CPI, and even suggested the concept of “making the world safe for democracy,” which became Wilson’s “idealistic” democratic vision for the world, still discussed in political science today. Lippmann and other intellectuals of the era recommended using social scientists and other intellectual elites to undertake “systematic intelligence and information control” as a “regular organ of popular government.” This was what Lippmann called the “manufacture of consent.”[11]

Lippmann wrote that, “propaganda, as the advocacy of ideas and doctrines, has a legitimate and desirable part to play in our democratic system.” Harold Lasswell, another leading political scientist of the era, wrote that, “[p]ropaganda is surely here to stay.” In his 1922 book, Public Opinion, Lippmann wrote that for the “manufacture of consent,” society needed “intelligence bureaus” or “observatories” which would distribute “disinterested” information to journalists, governments, businesses, and the society at large. This essentially is the function of think tanks and PR firms. The term “disinterested” is used to refer to the concept that the information and ideas are not shaped by emotional, irrational, or utopian concepts like “morality” or “ethics,” they are simply facts without a perceived ideology.[12]

In his 1925 book, The Phantom Public, Lippmann defined democracy for the modern state-capitalist system, which would not only be firmly entrenched within the United States, but exported around the world. Lippmann was quite emphatic: “A false ideal of democracy can lead only to disillusionment and to meddlesome tyranny.” That “tyranny,” of course, was the public interfering in the affairs of the state. Lippmann wrote that, “the public must be put in its place… so that each of us may live free of the trampling of a bewildered herd.” Referring to the public as “interested spectators of action,” Lippmann explained that, “the opinions of the spectators must be essentially different from those of the actors,” designed in such a way that the rulers of society – the corporate-financial elite and the intellectuals that serve them – would be able to continue controlling society with “the least possible interference from ignorant and meddlesome outsiders.” What Lippmann recommended in 1922 as the “manufacture of consent,” Bernays recommended in 1923 as “the engineering of consent.” Engineering consent, Bernays later wrote in 1947, “affects almost every aspect of our daily lives.” He explained: “When used for social purposes, it is among our most valuable contributions to the efficient functioning of modern society.”[13]

Presidents and politicians are products of public relations. We are presented with officially sanctioned concepts of democracy, politics, and ideology. We are subsequently given a ‘choice’ between – usually two – different accepted views. This is called “balance.” The difference between the views are primarily tactical, but the fundamentals remain the same. Thus, no matter the political party in power, war and empire are on the agenda, but different views can proliferate on the tactics and assessment of the results of imperial policies. Imperialism itself cannot be questioned, or even acknowledged; it’s simply accepted. The same goes for serving the interests of the corporate and financial elite, which of course are the main actors in determining foreign imperial policy itself. Imperialism and war for the benefit of a parasitic economic and financial elite, however, is not something which the public could openly accept, so we are given different words, definitions, and mythologies of our society and its policies, so that the “invisible governors” – as Bernays referred to them – may continue to “manufacture consent” to the system; thus maintaining ‘social order’, which means to maintain the social hierarchy of power.

Idealistic Democracy in the Land of Simplistic Hypocrisy

When we discuss Woodrow Wilson as president, we give warm and boisterous praise to his “enlightened” vision of “democratic idealism.” In fact, so consistent and engrained is our officially sanctioned respect for Woodrow Wilson’s profound vision, that it was given a special name: “Wilsonian idealism” or “Wilsonian liberalism,” to “make the world safe for democracy.” It was conceived of as a kind of “internationalist” vision for world order predicated on “international cooperation and integration,” countering political realism which viewed the international arena as one of anarchy where states act in their own self-interest.[14]

Wilson of course, was not concerned with acting in “self-interest,” because he had an enlightened vision of “liberal idealism.” No doubt it was this “idealism” upon which Wilson based his invasions and occupations of Haiti and the Dominican Republic, literally sending the Marines into the Parliament to disband it at gunpoint, killing tens of thousands of Haitians and crushing a liberation struggle in the country-side, and re-writing the constitution to allow American corporations to control the resources and buy land. In fact, Franklin D. Roosevelt, another democratic “idealist” president, was the Assistant Secretary of the Navy during the Haitian occupation (which began in 1915 and lasted until the Roosevelt administration in 1934). FDR took credit for writing the Haitian constitution, and claimed that he was responsible for “running several Caribbean republics.” Roosevelt referred to the Haitian occupation and his work on the new constitution as “an excellent piece of constructive work,” for which “the world ought to thank us.” He explained the common view of elites toward the general population – foreign and domestic – when he explained that in relation to Latin Americans, “You have to treat them like children.” The American media, with the New York Times at the helm, praised the ruthless occupation as a way for America to “advance” the Haitians, who were “a horde of naked niggers.” Wilson’s Secretary of State William Jennings Bryan reflected on his profound knowledge of Haitians when he stated, “Dear me, think of it! Niggers speaking French.”[15]

Wilson occupied the Dominican Republic in 1916, the neighbouring country to Haiti on the island once called Hispaniola when Columbus landed there and eradicated the indigenous population. When the U.S. ended the occupation of the Dominican Republic in 1924, a US-army trained commander, Rafael Trujillo, rigged the elections and became the country’s new dictator. President Hoover congratulated Trujillo on his “auspicious” victory. When FDR became president in 1933, he implemented his “Good Neighbor” policy for Latin America, meaning that America would be a “good neighbour” to ruthless tyrants like Trujillo so long as they served American interests. During this time, Trujillo, America’s “staunch friend” – as one American businessman referred to him – murdered roughly 25,000 Haitians in Dominican territory in an effort to “purify” and protect the ethnic superiority of the Dominican race. The genocide, however, created bad publicity for America’s support of Trujillo, since it drew obvious comparisons to similar dictators of the same era in Italy and Germany. So FDR’s administration undertook a “massive public relations effort” for the Trujillo regime, which included having biographies written about Trujillo in which he was described as emblematic of “democratic” and “humanitarian” virtues.[16]

In his speech at the Democratic National Convention, Bill Clinton referenced all the good work he has done for Haiti, explaining that he was “honored” to have worked with both president’s Bush and Obama in Haiti through various crises in the impoverished country. He presented this as evidence of how he is not a divisive politician, but seeks to work “with Democrats, Republicans and independents,” and that they “focus on solving problems and seizing opportunities.”[17] Well, how is Clinton’s record in Haiti? Should this question not be asked?

After the American occupation of Haiti ended, a dynastic dictatorship emerged as father and son Duvaliers ruled Haiti with an iron fist, and US support. When the dictatorship could no longer be sustained, it collapsed in the mid-80s, and following a series of military governments, Haiti undertook mass democratic elections in 1990, through which a populist priest and practitioner of Liberation Theology (the view that the purpose of Christianity was to fight for and liberate the poor from their poverty and oppression), Jean Bertrand Aristide, became victorious in securing the presidency. Aristide campaigned on empowering the extremely poor peasant population, which infuriated the local economic elite, who called him “the devil,” as well as U.S. corporate investors, since he attempted to implement the rather radical policy of doubling the minimum wage in the poorest country in the Western Hemisphere. This was obviously unacceptable and “irresponsible,” so in September of 1991, less than a year after being elected President, Aristide was deposed in a military coup. The CIA had formed close links with Aristide’s political opponents, and undertook a campaign to discredit him. Officially, the American government denounced the coup, though within days urged the military dictatorship “toward sharing power with the Parliament.” Economic sanctions were imposed, but quickly lifted in 1992 for the benefit of American corporations in Haiti as the State Department sought an “acceptable” political compromise. Aristide was pressured to sign an agreement that would allow him to “share” power and return to Haiti to continue the rest of his term as little more tan a figurehead.[18]

When Clinton came to power in 1993, his administration continued the process of negotiations aiming to bring Aristide into the “solution,” but only “when conditions permit,” and he agreed to share power with the US-favored candidate in the 1990 elections, a former World Bank official who was installed by the military coup. Meanwhile, the military government had killed thousands of Haitian civilians who were Aristide supporters. When an agreement was announced with Aristide, the military government in Haiti – armed by the US – quickly accelerated its murderous campaign. The US negotiations with Aristide focused on the perceived “need” for Aristide to “share” power with the military, because the Americans – who created the Haitian military force during the first US occupation of the country – viewed it as a source of “stability.” However, the military government refused to have Aristide return and share power with him in any capacity. Thus, Clinton’s National Security Advisor Anthony Lake instructed his staff at the National Security Council (NSC) to construct “Haitian invasion scenarios.”  The United States, however, was a promoter of “democracy,” so it needed to install a “civilian” government, and not be seen supporting a ruthless military dictatorship so openly. Aristide was given advice by the United States Agency for International Development (USAID), run by the U.S. State Department, as well as the World Bank and IMF, who “educated” Aristide on “suitable” economic plans for Haiti once he returned to power. It should be noted, however, that the CIA, several State Department officials, as well as several Democratic and Republican politicians felt it was a bad idea to return Aristide to power, and commonly referred to him as a “psychopath.” Obviously, someone would have to be a “psychopath” to attempt to raise the minimum wage in the poorest country in the Western Hemisphere.[19]

In 1994, Clinton invaded Haiti with 20,000 troops in what was called “Operation Uphold Democracy,” which not only re-installed Aristide to finish his term, but ensured that the coup leaders and perpetrators of atrocities were not held to account for their crimes, the result of a deal brokered by the “human rights” president Jimmy Carter, whom Clinton dispatched to Haiti in order to negotiate a deal with the military. The United States occupation forces handed over “control” of Haiti to a United Nations ‘mission’ of 6,000 soldiers in 1995, with US forces expected to leave in 1996, when Aristide’s term finished and he was replaced with a business-friendly leader. Though in 1995, Clinton’s Deputy Secretary of State Strobe Talbott, reassured the U.S. Senate that, “even after our exit in February 1996, we will remain in charge by means of USAID and the private sector.”[20]

This is called the “restoration of democracy.” While Clinton sent 20,000 troops to Haiti to “restore democracy,” Obama sent 10,000 troops to Haiti to “restore order” following the devastating earthquake which killed several hundred thousand people who were living in the slums that were created through World Bank and IMF policies of austerity and structural adjustment, many of which were imposed during the Clinton administration. When Obama sent his troops to Haiti, he pledged that the “United States is in Haiti for the long haul.”[21] Indeed the U.S. has been invading and exploiting Haiti and punishing its population for over 200 years, so why stop now?

“The Price is Worth It”: How To Get Away With Murdering Half a Million Children

In his speech at the DNC, Clinton also praised Obama’s “successful end of the war in Iraq.” Clinton, of course, has had a great deal of experience when it comes to Iraq. After Iraq had stopped being a pliant U.S. puppet, George Bush Sr. waged a brutal war against the country, after which economic sanctions were imposed, lasting through the duration of the Clinton administration. The sanctions, in fact, began in 1990 before the first Gulf War, which destroyed the entire infrastructure of the country. Margaret Thatcher explained that the purpose of the Iraq war was to “destroy the entire military, and perhaps industrial, potential of that country.” The sanctions from 1990 to 2000 resulted in the deaths of roughly 1.5 million Iraqis, over 500,000 of which were children under the age of 12. The New York Times praised the sanctions as one of the “greatest successes” for the UN in Iraq. Three top UN officials who were sent to Iraq to monitor the sanctions and provide humanitarian assistance resigned in protest against the sanctions, explaining that they were causing immense harm to the civilian population. When Clinton’s Secretary of State Madeleine Albright was asked in 1996 about the 500,000 children killed by the sanctions, Albright stated, “we think the price is worth it.”[22]

Obama of course, has learned a valuable lesson from Clinton, and imposed sanctions on Iran in order to punish the Iranian population. The day before Clinton spoke at the DNC endorsing Obama, the Financial Times reported that the US-imposed sanctions on Iran were having the predictable effect as they were hitting medical patients especially hard, as deliveries of medicine and raw material for Iranian pharmaceutical companies was either stopped or delayed, as “access to medicine has become increasingly limited.” One Iranian medical NGO official commented, “This is a blatant hostage-taking of the most vulnerable people by countries which claim they care about human rights.”[23]

However, these are exactly the intentions of sanctions. When Castro overthrew the U.S.-supported dictatorship in Cuba in 1959, Cuba became the primary enemy of the United States because, in the words of a 1960 National Intelligence Estimate, of Cuba’s “successful defiance of the U.S.” As the Eisenhower administration – and the Kennedy administration following him – designed and implemented harsh economic sanctions, top officials were quite blunt in their internal discussions about the effects and intent of the policies. Eisenhower noted that if the Cuban people “are hungry, they will throw Castro out,” since the “primary objective” of the sanctions, the president noted, was “to establish conditions which will bring home to the Cuban people the cost of Castro’s policies.” Kennedy administration officials explained that the sanctions – and the accompanying covert warfare – were designed to alienate “internal support” in Cuba to Castro’s government, “based on economic dissatisfaction and hardship,” which meant that US policy had to aim “to bring about hunger, desperation and [the] overthrow of the government,” explained one State Department official.[24]

“It Takes Some Brass”: Serving the Corporate Consensus with the Politics of Poverty

The media outlet, PolitiFact, reported on Bill Clinton’s DNC speech, writing that the former president “received a hero’s welcome,” and then confirmed Clinton’s statements on the economy as “true.”[25] Well, what are some things that Clinton said about the economy? One thing Clinton stated was that, “It turns out that advancing equal opportunity and economic empowerment is both morally right and good economics,” adding that, “poverty, discrimination and ignorance restrict growth.” He proclaimed that the Democrats “think the country works better with a strong middle class, with real opportunities for poor folks to work their way into it.” Clinton noted that the Republicans “want to get rid of those pesky financial regulations designed to prevent another crash and prohibit future bailouts.” Clinton, while referring to a Republican politician, noted, “it takes some brass to attack a guy for doing what you did.”[26] While the audience laughed, applauded, and cheered at that statement, the irony was lost on the fact that Clinton was doing just that: “attacking a guy for doing what [he] did.” Clearly, Clinton has “some brass” to not only do that, but to actually comment on that technique.

It’s truly an amazing exercise in absolute hypocrisy to see a man stand up in front of millions of people and blame Republicans for wanting to get rid of “pesky financial regulations” when his administration was largely responsible for getting rid of the most important “pesky financial regulations” – such as the repeal of the Glass-Steagall Act – which Obama has obviously not even considered re-instating. The economic crisis – which is only going to get worse, since Obama has ensured that the next financial crisis will be much more severe than the last one – was not caused by a political party, it was caused by a socio-political and economic ideology that we call ‘neoliberalism.’ This ideology was and still is endorsed and promoted by Republicans and Democrats alike. So from Reagan onwards, every single U.S. president is responsible for creating and making the economic crisis worse, because they implemented policies which were designed to benefit the few at the expense of the many. And when the system crashes, as it inevitably does, the government moves in to save the banks and financial institutions from their crimes, and hand the people the bill.[27]

Under Bill Clinton, the derivatives market exploded as financial institutions were deregulated, major mergers approved – creating what we now call “too big to fail” banks – which since Obama’s “economic recovery” are bigger and more dangerous than ever. Under Clinton, the Federal Reserve kept interest rates at historic lows and provided liquidity (money) to help build the housing bubble, with which Clinton’s unregulated derivatives market saw an explosion in speculation, not only allowing banks and hedge funds to help create the financial crisis, but also to profit from it, as Goldman Sachs did (which was Obama’s main campaign contributor in his 2008 election). Clinton’s administration had the Department of Housing and Urban Development pressure the mortgage giants – Fannie Mae and Freddie Mac – to provide mortgages to low-income borrowers, which helped build the housing bubble under an illusion of prosperity. The Glass-Steagall Act, which was put in place in 1933 in response to the Great Depression, was designed to prevent another Great Depression. So of course, banks like JP Morgan, Citicorp and others lobbied heavily to have it repealed (as a barrier to “growth”), and the Federal Reserve and Clinton’s Treasury Department responded to the demands of their constituents – the banks and corporations that they represent in government – by dismantling these “pesky financial regulations.” Thus, Alan Greenspan at the Fed, Robert Rubin and Larry Summers at the Treasury were among the key architects of the economic collapse, along with their constituents at JPMorgan Chase, Citigroup, Bank of America and Goldman Sachs.[28]

So naturally, when Obama became president, it was important to appoint all the people who caused the crisis to positions in which they are responsible for solving the crisis they helped create. So Obama appointed Larry Summers to be his chief economic adviser, and of course, Timothy Geithner who previously served as President of the New York Federal Reserve, where he was appointed to that position by the major Wall Street banks he was to represent. Geithner was also a protégé of Clinton’s Treasury Secretary Robert Rubin. Rubin had since become an executive at Citigroup, rewarded for his work in dismantling “pesky financial regulations” and thus able to profit from the crisis he helped create. Summers had previously shown his propensity for “morally right and good economics” – as Clinton described it – when he was Chief Economist at the World Bank in 1991, where he wrote a secret memo advocating Western nations and corporations to dump toxic waste in poor African countries because by the time the effects of cancer emerge, statistically speaking, the population would already be dead because their life expectancy was so low. Thus, wrote Summers, “I think the economic logic behind dumping a load of toxic waste in the lowest-wage country is impeccable and we should face up to that.”[29]

Clearly, Clinton’s economic policies as president – and those of which he has endorsed in Obama’s administration – were a triumphant success for the dominant banks, financial institutions and corporations that own the government. Despite all the evidence of Goldman Sachs having engaged in repeated criminal activity in causing the financial crisis and profiting off of it (not to mention getting massive bailout funds from Obama), Obama’s [In]Justice Department recently announced that the U.S. government “will not prosecute Goldman Sachs.”[30] And of course not, why would Obama prosecute the bank that was his number one financial contributor in his 2008 election campaign. Though of course, it should be noted, that Obama’s 2008 campaign had some diversity among its top donors: JPMorgan Chase, Citigroup, and UBS, among others. The financial institutions preferred Obama over John McCain in 2008, and it was a smart investment for them.[31] After all, Obama’s bailouts gave the banks $16 trillion.[32]

No surprise then, to see that Obama’s top campaign donors in 2012 include Wells Fargo, JPMorgan Chase and Goldman Sachs. And since the U.S. Supreme Court voted in January of 2010 to allow corporations to contribute as much money as they want to election campaigns – under “constitutional free-speech rights” – campaign spending has increased dramatically.[33] Thus, while Wall Street gave the Obama campaign $16 million in 2008, that number has soared during the current election, with the same contributors donating to Romney.[34] Among Romney’s current top supporters are Morgan Stanley, Bank of American, JPMorgan Chase, and Goldman Sachs, with Obama getting more support from Microsoft, Google, IBM, and others.[35] While Obama parades around calling Wall Street executives “fat cats,” Obama and the Democratic National Committee raised more than $14 million from the “fat cats” through the end of April 2012.[36]

Clinton stated at the Democratic Convention, reflecting upon his economic policies of the 1990s, “We could see that the policies were working, that the economy was growing… [and] by 1996 the economy was roaring,” neglecting to mention it was a roaring bubble built upon speculation and debt. This, of course, received a thunderous applause for Clinton as he spoke, adding that President Obama “has laid the foundation for a new, modern successful economy of shared prosperity. And if you renew the president’s contract, you will feel it. You will feel it.”[37] He had to repeat that part because people haven’t been “feeling it,” so it was important to remind them that current conditions are no basis for assessing the future. One must assess the future based upon pure “faith.” Hence, “you will feel it” is repeated despite all the policies that indicate otherwise.

Neil Barofsky, the special inspector general responsible for oversight of Obama’s bailout program, recently published a book entitled, “Bailout: An Inside Account of How Washington Abandoned Main Street While Rescuing Wall Street,” in which he wrote, “I had no idea that the U.S. government had been captured by the banks,” but this became clear as the bailouts were “setting the country up for potentially catastrophic losses.”[38] In his final report as inspector of the bailouts, Barofsky wrote: “The prospect of more bailouts will continue to fuel more bad behavior with potentially disastrous results.” In other words, the concept of “too big to fail” is an insurance policy for banks, telling them that the government will always be there to save them, and thus, they have no incentive to engage in safe financial practices, and are actually encouraged to continue making highly risky and speculative investments, paving the way for the next financial crisis at which time they will be bailed out again. Barofsky called the bailouts a “colossal failure,” under which the Treasury Department “made almost no effort to hold [the banks] accountable, and the bounteous terms delivered by the government seemed to border on being corrupt.”[39] Just more of Clinton’s “morally right and good economics,” no doubt.

“Free Trade” and Costly Poverty: A Bi-Partisan Consensus

Clinton of course, also implemented the NAFTA agreement, which is a protectionist corporate-dominated system of economic integration and exploitation between Mexico, Canada, and the US, undermining labour, de-industrializing the northern countries, exploiting the labour of poor Mexicans, and undertaking a concerted assault against the middle class. Thus, it is called a “free trade agreement,” though it consists of thousands of pages of rules and regulations expanding corporate rights and domination of the economy. This is perhaps what Clinton was referring to when he said that Democrats work towards “advancing equal opportunity and economic empowerment” in order to provide “real opportunities” for “a strong middle class.” Those statements were of course met with thunderous applause and cheers.

Back during the 2008 campaign, both Barack Obama and Hillary Clinton said that they would renegotiate NAFTA, and even suggested that the United States would pull out of the agreement. While campaigning, they made these statements at a debate in Cleveland, Ohio, where NAFTA is “wildly unpopular with blue-collar workers,” due to all the manufacturing jobs that were lost as a result of the trade agreement. Hillary Clinton stated that she would “renegotiate it on terms that are favourable to all of America.” Obama agreed with Hillary at the debate, stating, “I will make sure that we renegotiate in the same way that Senator Clinton talked about, and I think actually Senator Clinton’s answer on this one is right.” Obama said that he would “ensure that we actually get labour and environmental standards that are enforced… That is something that I have been consistent about.”[40]

The Canadian business and financial elite – and their mouthpieces in the media – immediately declared the sky to be falling as a result of presidential hopefuls suggesting to renegotiate NAFTA. It was leaked to the Canadian media that a senior member of Obama’s campaign team contacted the Canadian Consulate in Chicago to inform them that when Obama talks about renegotiating or “opting out” of NAFTA, “it was just campaign rhetoric not to be taken seriously.” In other words, he was just lying to get into power. The statements were made by Austan Goolsbee, Obama’s senior economic adviser during his campaign.[41] Goolsbee further informed Canadian officials that Obama’s stand on free trade during the campaign trail was “more reflective of political maneuvering than policy,” and that Obama’s language “should be viewed as more about political positioning than a clear articulation of policy plans.”[42] In other words, it is important to completely ignore everything Obama says while he is campaigning for president, because it is all lies meant to be consumed by the “ignorant and meddlesome outsiders,” the voting public. It does not reflect the actual policies and plans of Obama, which the public is not to be informed of.

So why lie about NAFTA? In Ohio, where the pledges to renegotiate NAFTA were made, the trade agreement led to the loss of roughly 200,000 manufacturing jobs, while the U.S. as a whole lost some 3.1 million jobs between 1994 and 2009 due to NAFTA, which also led to a trade deficit with Mexico and Canada that was $9.1 billion in 1993, and has since risen to $138.5 billion in 2007. During the presidential campaign, national polls revealed that 56% of the American population was in favour of renegotiating NAFTA. In Mexico, hundreds of thousands of people had marched in opposition to NAFTA, demanding renegotiations, and in Canada, 61% of the population favour renegotiation.[43]

Public opinion polls are extensively studied by the public relations industry and political strategists, who advise politicians during their campaigns (and once they take power). Because public opinion is in favour of renegotiating NAFTA, the rhetoric of politicians must reflect public opinion, so that the politicians are viewed in a good light and get the votes they need to get into power. However, because politicians are put in power to serve the interests of corporate and financial institutions, it can only remain as rhetoric, because renegotiating is against the interests and desires of the economic and financial elite, who are, after all, the major financial contributors to electoral advertising campaigns. So public opinion must be studied so that it can be used to manipulate the public – “the engineering of consent” – but then it must also be immediately undermined and dismissed, so that policy does not actually follow public opinion. Rather, public opinion – to the best degree possible – must be influenced to follow policy.

Raymond Chretien, former Canadian Ambassador to the U.S. and nephew of former Canadian Prime Minister Jean Chretien (who implemented NAFTA in cooperation with Bill Clinton), said in November of 2008, just following Obama’s successful election, that Obama “will likely find a way to back off his election campaign promise to renegotiate” the agreement, adding, “once in power in January, once apprised of what is at stake here,” meaning, massive corporate profits, “I doubt very much that he will want to reopen that.”[44] Within less than a month of becoming president, Obama stated that his promise to renegotiate NAFTA “will have to wait”; forever, no doubt.[45] Kind of like closing the torture camp at Guantanamo.

So apart from just lying about trade agreements to get into power, what is Obama’s actual record as president on trade agreements? Negotiations were begun under the Bush administration in 2008 for the Trans-Pacific Partnership (TPP), and of course, since the difference between Obama and Bush was one of rhetoric, the negotiations continued in the same manner: secretly.

The Office of the U.S. Trade Representative (USTR) has been working for over three years on a massive so-called “trade agreement” behind closed doors, with input given only to 600 corporate lobbyists who have had access to the draft deal and negotiations, which have otherwise been kept secret from the public. Just part of Obama’s promised “transparency,” no doubt. The agreement includes the U.S., Australia, Brunei, Chile, New Zealand, Peru, Singapore, Malaysia, and Vietnam, among others. Roughly 133 Democratic representatives wrote a letter to Obama demanding access to the “secret texts” of the trade deal, with public interest groups warning that millions of jobs could be lost as a result of the agreement.[46]

While it is called a “trade agreement,” only 2 of the 26 chapters in the TPP have to do with trade, with the majority of the rest dealing with establishing corporate rights, protections, privileges, as well as constraints on “pesky” government regulations. Among these new “rights” and “privileges” for corporations (who obviously do not have enough rights and privileges as it is) include more job offshoring, protections to allow monopolies to raise prices, as well as new corporate controls established over natural resources. The deal also includes threats to food safety, land use, environmental protection, energy use and control, as well as a special chapter on “copyrights” which includes a massive threat to Internet freedom, which was previously stalled in Congress with the attempted Stop Online Piracy Act (SOPA). Obviously, dismantling Internet freedom through a corrupt institution like Congress failed due to public pressure, and thus, Congress is still too influenced by the “meddlesome and ignorant outsiders,” so it’s better that such an agreement be negotiated in secret with 600 corporations.[47]

Documents from the deal have been leaked, which is the only way that any of this information has become public. When the documents were leaked, it was reported that the Obama administration “intends to bestow radical new political powers upon multinational corporations.” In the documents, it was revealed that Obama’s administration has emerged as a very strong advocate “for policies that environmental activists, financial reform advocates and labor unions have long rejected for eroding key protections currently in domestic laws.” In other words, the already ineffective and almost-useless and toothless environmental, financial, and labour protections that exist are simply unacceptable to the Obama administration and the 600 corporations Obama is taking his orders from. The agreement stipulates that foreign corporations operating in the United States would no longer be subject to domestic US laws regarding protections for the environment, finance, or labour rights, and could appeal to an “international tribunal” which would be given the power to overrule American law and impose sanctions on the U.S. for violating the new “rights” of corporations.[48]

During his 2008 presidential campaign, Obama stated, “We will not negotiate bilateral trade agreements that stop the government from protecting the environment, food safety, or the health of its citizens; give greater rights to foreign investors than to U.S. investors; [or] require the privatization of our vital public services.” I suppose that was somewhat true, since technically it isn’t a “bilateral” agreement, but rather a “multi-lateral” agreement. Referring to the changed rules for medication – which would allow companies to increase prices and control monopolies over life-saving medications, as well as prevent poor countries from developing cheap alternatives – the U.S. manger of Doctors Without Borders Access to Medicines Campaign, stated, “Bush was better than Obama on this.” The agreement would of course grant similar rights to American corporations in the other countries of the TPP agreement, thus, it serves as a profitable and exploitative bonanza for all multinational corporations involved, and of course, all the populations from the countries involved will suffer as a result. The “international tribunal” which would dictate the laws of the countries would be staffed by corporate lawyers acting as “judges,” thus ensuring that cases taken before them have a “fair and balanced” hearing, as in, fairly balanced in favour of corporate rights over… everything else. The TPP deal is strongly supported by the U.S. Chamber of Commerce, the largest business lobby in the United States, as well as by presidential hopeful Mitt Romney, who has urged the U.S. to finalize the deal as fast as possible.[49]

Public Citizen is the organization that published the leaked document, a public research institution whose director, Todd Tucker, stated, “The leaked document… shows that in all of the major respects, this is exactly the same template that was used in NAFTA and other agreements that President Obama campaigned against,” and noted that the TPP has provisions that allow other countries to join in the future, potentially becoming a new “global trade agreement, larger than NAFTA.”[50] The American Prospect reported on the TPP leaks, writing that, “the TPP now threatens a slow-motion stealth attack against a century of progressive domestic policy,” though it’s hardly slow-motion, and the policies that exist can hardly be said to be “progressive,” but nonetheless, all the little concessions granted to the demands of the “bewildered herd” of “interested spectators” were simply too much to bear for corporate dominance. Gary Horlick, a former U.S. trade official who had spent four decades involved in trade deals, stated, “This is the least transparent trade negotiation I have ever seen.” In fact, participants in the negotiations and discussions have to sign a memorandum of understanding which forbids them from releasing any “negotiating documents until four years after a deal is done or abandoned.” In short, Obama’s TPP is a “corporate coup.”[51]

The objective with the “unprecedented secrecy” in the negotiations is to have the deal signed before the elections. As the U.S. Trade Representative Ron Kirk noted, “I believe … that we have very faithfully operated within the spirit of the Obama administration to have the most engaged and transparent process as we possibly could.” Though he explained what he meant by “as we possibly could,” when he added that, “there’s a practical reason” for all the secrecy: “for our ability both to preserve negotiating strength and to encourage our partners to be willing to put issues on the table they may not otherwise, that we have to preserve some measure of discretion and confidentiality.” In other words, the secrecy is necessary because if people knew what we were doing behind closed doors, they would oppose it, and the deal would be stopped. Yes, that is very “practical.” When asked if he would release a draft text of the agreement, Kirk replied that it was too early to do that, “there will be a time, once we have agreed on text, that we may – as we have with other agreements – be able to release that.” In other words: “maybe, and by maybe, I mean… nope!” Meanwhile, other nations don’t want to be left out of such an ambitious and “prosperous” trade agreement, as Japan, Canada, and Mexico have been lobbying to be included. But this would require the three countries to implement changes to their already-existing policies which would allow them to even be considered to enter the TPP. In other words, even Mexico doesn’t meet the required standards of desirable corporate exploitation and domination to be considered.[52]

All the secrecy is very important, because as public opinion polls show, the entire population is adamantly opposed to these types of negotiations. An opinion poll from 2011 revealed that the American population has – just over the previous few years – moved from “broad opposition” to “overwhelming opposition” to NAFTA-style trade deals. A major NBC News-Wall Street Journal poll from September of 2010 revealed that “the impact of trade and outsourcing is one of the only issues on which Americans of different classes, occupations and political persuasions agree,” with 86% saying that outsourcing jobs by U.S. companies to poor countries was “a top cause of our economic woes,” with 69% thinking that “free trade agreements between the United States and other countries cost the U.S. jobs,” and only 17% of Americans in 2010 feel that “free trade agreements” benefit the U.S., compared to 28% in 2007. A Democratic Party polling firm revealed that 45% of voters were much more likely to support a Democratic candidate if the candidate pointed out how their opponent supported various “free trade agreements” negotiated by George Bush. The same polling agency revealed in 2010 that Americans do not feel “warmly” towards corporations and banks, with only 29% of voters feeling “warm” toward corporations (compared to 13% among non-voters), and 12% of voters felt “warm” toward banks (compared to 16% among non-voters). These are lower ratings than those for Obama, Sarah Palin, the GOP, Democrats, Newt Gingrich, the NRA, labor unions, and much more. Polling showed that voters who vote for Democrats cited “job offshoring” as “the most important issue facing the country,” and felt that Republican support for offshoring was the “most important reason to not vote Republican.”[53]

The extensive polling, which politicians are well aware of, reflects a view that citizens look at corporations and banks unfavorably, and that issues of “free trade” and “job offshoring” feature extremely high in their concerns, and whether Democrat, Republican, or Independent, the population is overwhelming in opposition to “free trade” agreements. So, the lesson from all this research on public opinion is not to change the policy to meet the demands of the public, but rather to change the discussion. So “free trade” agreements are simply not discussed, hence the enormous secrecy behind the TPP. Since corporations and banks are viewed so unfavorably, you simply remove them from the discussion. After all, it is the corporations and banks that the politicians are there to serve, and you don’t want to bad mouth your bosses in public too much or too loud (unless it’s “just campaign rhetoric”). Thus, when it comes to blaming the economic crisis on someone, the discussion must be simplified to an absurd little fairy tale in which you remove facts from reality, and create an image and establish a political discourse in which it was either: a) the Republicans did it, or b) the Democrats did it. By framing the discourse at this very basic, black and white manner, you immediately divide people against each other, instead of uniting them in opposition to the banks and corporations which control the politicians and the government. This is done for obvious reasons. You can’t expect a parasite to help you find a way to get rid of parasites. That’s why public relations was invented.

“Jobs, jobs, jobs. Jobs jobby-jobs, jobby job-jobbin… Jobs.” – Every Politician Ever

When politicians blather about, they almost always mention this magical word called “jobs.” They usually state that their intention is to “create jobs” or that they have already “created jobs.” This is taken as a testament to their tireless work on behalf of the population that elected them. Jobs are good. So if politicians create jobs, they are doing good… right? Well, what if the word “jobs” meant something different when politicians say it? Perhaps, it would be helpful to seek a definition, so that we can translate political language and understand what is really being said. After all, if you only speak English, and you’re listening to someone who only speaks Spanish, you might recognize a couple of words now and again, but ultimately, you need a translation in order to understand what is being said. As Noam Chomsky has pointed out in countless public speaking events, when politicians say “jobs,” what they mean to say is, “profits.” Perhaps this is worth investigating, no?

First, we must ask some basic questions. Why are jobs important? Because they provide a means of living, of earning income, and thus, generating wealth and prosperity for all. That’s the story, anyway. But essentially we can deduce that jobs are important because they provide income, which we depend on to live. So, if we are to talk about jobs, we have to talk about income.

In June of 2012, the OECD – an international organization of economists representing 34 of the wealthiest countries on earth – released a report noting that the United States is facing “record long-term unemployment, income inequality and lack of investment in education and innovation.” The report noted that for the U.S., “income inequality and relative poverty are among the highest in the OECD.” Only Chile, Mexico, and Turkey rank higher among OECD nations in terms of income inequality. The chances of staying poor are higher in the U.S. than in Europe. As Deputy Secretary-General of the OECD and former State Department official Richard Boucher explained, “If your parents are poor, the chances are you are going to stay poor.” As the comedian George Carlin once said, “It’s called the American Dream, because you have to be asleep to believe in it.” The OECD report also noted, “the ongoing tide of foreclosures will continue to put downward pressure on house prices.” Just more of that “economic recovery” that we are told we are experiencing. Long-term unemployment in the U.S. is especially bad, with 40% of the unemployed – that’s officially 5.3 million Americans – have been out of work for 27 weeks or more. As the report also noted: “Although the middle class have seen their taxes remain roughly constant, or slightly increase, average income taxes have significantly declined for the most wealthy, especially the 1% top earners.”[54]

In 2008, the average household income for the top 1% was $1.2 million, though the percentage is highly skewed, as entry to the top 1% starts at $380,000. The share of total national income going to the top 1% reached an 80-year high in 2007, of 23.5% (and 17.6% in 2009 as the financial market deflated). For the top 0.1%, the inequality is even more pronounced. Their share of total income for the United States was 12.3% in 2007, sinking to a “still disproportionate” level of 8.1% in 2009 with the financial crash. Though this is a general trend in most countries of the OECD nations, it “began sooner, and has gone further, in America.” Increasingly, those who are within the top 1% work in finance, a trend which has increased faster than any comparable business between 1979 and 2005. In 1979, 8% of those within the top 1% worked in finance; in 2005, 13.9% of those in the top percentile worked in finance. For the top 0.1%, in 1979 roughly 11% were in finance, and in 2005 roughly 18% were in finance. The last time that income inequality was even comparable to the present day situation was during the Great Depression.[55]

Nobel Prize winning economist Joseph Stiglitz said in June of 2012 that the United Sates is “no longer the land of opportunity” and “the ‘American dream’ is a myth.” As he detailed in his newest book, The Price of Inequality, “America has the least equality of opportunity of any of the advanced industrial economies.” This inequality will only widen in the coming decades, he warned, because the lack of mobility makes it a reinforcing system, and America will become a two-class society: “People will live in gated communities with armed guards. It’s an ugly picture. There will be political, social and economic turmoil.” Stiglitz, however, said there was a solution: eliminating “corporate welfare” and policies that “create wealth but not economic growth.”[56] In other words, instead of just creating profits for the few, focus on prosperity for the many. However, all U.S. administrations – whether Democrat or Republican – have done the exact opposite.

Between 1979 and 2006, the share of national income that went to the top 1% doubled, while the top 0.1% have amassed a larger share of the national income than at any other point on record. Between 2009 and 2011, the S&P500 (the stock prices of the top 500 companies) went up by over 80%, while median household income declined by more than 10%. While the bottom 50% of Americans own 2.5% of the national wealth, the top 1% own 33.8%. The bottom half of Americans own 0.5% of stocks, bonds, and other investment assets, while the top 1% own 50.9%. As of 2007, the top 1% had 5% of the debt, while the bottom 90% had 73% of the debt. Tax rates for the richest Americans are almost the lowest they have ever been. Productivity of workers has increased exponentially since 1947, but inflation-adjusted wages have remained flat for the same period of time. Between 1990 and 2005, the average pay for a CEO increased by 300%, and corporate profits have doubled, while pay for “production workers” (labour) has increased by 4% and the minimum wage has dropped. In 1970, the top CEOs earned 45 times as much as the average worker; in 2006, the top CEOs earned 1,723 times as much as the average worker. America has more income inequality than Egypt, India, China, Russia, and Iran. This inequality is further strengthened when you examine the generational divide. Between 1984 and 2009, the median net worth of people under the age of 35 has dropped by 68%, while seniors have gotten 42% richer. Adjusted for inflation, in 1984, the median wealth of someone under 35 was $11,521; in 2009, it was $3,662.[57]

Now we get to the actual subject of “jobs,” of which Clinton spent so much time discussing in his speech at the DNC, that Democrats are better at creating “private-sector jobs” than Republicans, which was met with thunderous applause, and endless articles in the media explaining how “right” he was. Well yes, the “private sector” has added some jobs. This led Obama to say in June that the private sector was “doing fine.” When this created a public relations problem for Obama, he later clarified that it is “absolutely clear that the economy is not doing fine.” He added: “If you look at what I said… we’ve actually seen some good momentum in the private sector… record corporate profits… so that has not been the greatest drag on the economy.”[58] Indeed, this is partly true. In May of 2012, the largest 500 corporations (the Fortune 500, as they are called) reported record-breaking profits, with ExxonMobil and Wal-Mart in the top spots. Further, “the combined earnings for the Fortune 500 corporations rose 16% from 2010 to a record high of $825 billion in 2011.”[59] As profits increase, the pay for CEOs increases too, jumping just 6% in one year.[60] In June of 2012, the Federal Reserve revealed that between 2007 and 2010, Americans saw their wealth plummet by 40%.[61] So, Obama was correct in saying that we have seen “record corporate profits,” but incorrect in saying that this was not a “drag on the economy,” as it rapidly accelerates income inequality, which, quite directly, creates a drag on the economy, to say the least.

While the private sector has been adding jobs, the public sector has been cutting them, at both the state and federal level, which has been hitting black Americans the hardest.[62] This has been a significant “drag” on economic growth (it’s called “austerity”), and it is a growing trend, and will continue regardless of whether a Democratic or Republican politician is in office, because it is what is demanded by the economic and financial elite and neoliberal ideology: which dictates “austerity” and “structural reform” as a response to a crisis. When you translate those words, you get “impoverishment” and “exploitation.” This leads to “growth,” which means “profits.” Just like the word “jobs” also often means profits.

When Obama created his “Jobs and Competitiveness Council,” he asked 26 CEOs to form a group to advise the president on how to “create jobs.” The council was headed by Jeffrey Immelt, the CEO of General Electric, but also included other “job creators” like the CEO of American Express.[63] And who better than the CEO of General Electric to lead the charge on “job creation”? After all, General Electric has cut significant amounts of American jobs, so naturally, it’s a logical choice from which to appoint a “jobs czar.” Between 2000 and 2009, the number of Americans employed by GE declined from 162,000 to 134,000, a general trend which saw U.S. multinational corporations reduce their domestic American workforce by 2.9 million people in the past decade, while increasing their overseas workforce by 2.4 million. When Obama appointed GE’s CEO, Jeff Immelt as “jobs czar,” President Obama stated that Mr. Immelt “understands what it takes for America to compete in the global economy.”[64] Indeed, it “takes” undermining labour, worker exploitation, deregulation, offshoring, job insecurity, and government subsidy for corporations. In fact, the ten largest companies on Obama’s “jobs council” have shed over 91,000 jobs since 2009, with General Electric contributing 19,000 job losses to that number.[65]

So, if we do translate the word “jobs” into the word profits, then things tend to make more sense. After all, Obama appointed Immelt as his “jobs czar,” after Immelt cut 19,000 U.S. jobs but helped GE make record profits, and not only that, but GE does not pay any taxes, and instead, claims billions of dollars in tax benefits.[66] Thus, it makes more sense to think of Immelt as the “profits czar” who was put on Obama’s “profits council” to “create profits.” When you translate political language, everything suddenly makes much more sense, because it becomes comprehensible and logical. It just also happens to be rather monstrous and corrupt and infuriating, but that’s why political language is constructed: to not be properly understood. Thus, it was perfectly understandable for Bill Clinton, who implemented NAFTA which led to massive job losses, declining wages and standards of living, increased debt, offshoring, but also immense corporate profits, to explain in his speech that, “we need a lot more new jobs,” but pointed out what a good record Democrats have for “creating jobs.” Indeed, General Electric and Goldman Sachs would agree.

Public Relations Shapes the Debate

Since the economy is a disaster, it is very important to properly shape the discourse on economic issues, most especially during a political advertising campaign, otherwise it would be difficult to maintain any legitimacy. Greenberg Quinlan Rosner is a public opinion research and strategic consulting firm that often works with the Democratic Party. Essentially, it is the Democratic Party’s public relations organization. In June of 2012, James Carville, a long-time Democratic Party political strategist who was the lead strategist for Bill Clinton’s successful presidential campaign, produced a research report along with other top political strategists for Greenberg Quinlan Rosner. The report was entitled, Shifting the Economic Narrative, which suggested that the “prevailing narratives articulated by national Democratic leaders” are “vulnerable” in regards to the economic situation. In other words, the Democratic rhetoric and talking points on the economy don’t have much legitimacy. The report wrote that Democrats face an impossible situation in the elections “if we do not move to a new narrative,” or, to construct a new story. This would mean to change the story to “one that contextualizes the recovery but, more importantly, focuses on what we will do to make a better future for the middle class.” The report stated that voters “know we are in a new normal where life is a struggle – and convincing them that things are good enough for those who have found jobs is a fool’s errand,” thus, the narrative must shift to discussing “the plans for making things better.” While noting that the Democrats were losing voters on the economy, the report added that the same voters were still leaning toward the Democrats “because Romney is very vulnerable,” since “[t]hey do not trust him because of who he is for and because he is out of touch with ordinary people.” The report noted that the result was that, “it produces a fairly diminished embrace of Obama and the Democrats, the lesser of two evils, without much feeling of hope.”[67]

What voters “want to know,” wrote the report, was that Obama “understands the struggle of working families and has plans to make things better.” It doesn’t matter whether or not this is true, of course, but just that people believe it, and that they “want to know” it. The report noted that it had conducted several focus group research studies on college-educated voters who are ‘independents’ or ‘weak partisans,’ meaning that they only somewhat align with a particular political party. The research was revealing: while most had jobs, they had lower wages and fewer benefits which has left them struggling to pay for groceries. For non-college graduates, the situation is even worse, largely dependent upon food stamps and with many expressing that they feel as if they live in the 1900s where “you’re just slave labour.” Young people also have a disproportionate struggle, and are increasingly moving back home with their parents. Even in affluent suburbs people are “struggling with new realities,” such as “stagnant incomes, pay cuts, and layoffs.” Wile bills go up, paychecks either remain stagnant or go down, and this is most keenly felt in the cost of groceries, gas, cable bills, and medical insurance. These voters, the report suggested, “are not convinced that we are headed in the right direction,” with “no conceivable recovery in the year ahead that will change the view of the new state of the country.” These people, stated the report, “actually have a very realistic view,” and thus, “the current narrative about progress just misses the opportunity to connect and point forward.”[68]

While most of these voters support Obama, “they say it cannot get worse and you have to believe it will get better.” The “optimism” is predicated on the basis that “this has to be rock bottom,” which the report defined as “pessimistic optimism.” The type of “leaders” they are looking for are those “who understand the uncertainty and can lead a way forward.” While the Obama campaign talks about “jobs gained,” wrote the report, “it gains no support beyond 2008 Obama supporters.” On the economy, Romney supporters typically cannot say anything positive except that he is “not Obama.” However, many voters would still choose Romney over Obama when it comes to the economy, but when forced to choose between the two on the whole, “many of the Obama voters work to figure out a way to support him, though it lacks the kind of emotion and rationale that would drive engagement.” In other words, support for Obama tends to be driven more by the fact that he is “not Romney.” In the words of the report, it was that Obama was “the evil you know” and the “lesser of two evils.” While the patience of voters on Obama was “wearing very thin, they still want to believe in him.” All the ideas of voters that support Obama “center on what he should do – not what he has done.”[69] In other words, support is maintained in false hope.

In terms of “shifting the economic narrative,” the research report suggested that, “the strongest message was one focused on the future of the middle class – with minimal discussion of the recovery and jobs created and maximal empathy for the challenges people face.” Thus, the election needs to be about the “future of the middle class.” Two-thirds of those who partook in the focus groups responded positively to this message of helping the middle class, and they reacted well to references of the Clinton era economy (when their wealth was constructed on an illusion of debt and consumption). Ultimately, the report suggested that the best advertising campaign for the Democratic Party and Obama in particular was to “connect on a pocketbook level” and “commit to the programs voters rely on most,” such as Medicaid, Social Security and foodstamps. This rhetoric has “the capacity to be very powerful, particularly when the offer on the other side is suspicious and weak.”[70]

This “shifting message” was well received in Bill Clinton’s speech, where he talked about moving people “out of poverty [and] into the middle class,” and warning people that the Republicans will “hurt the middle class and the poor and put the future on hold.” That phrase, in particular, hit all the right points of discussion as suggested by the Democratic Party’s polling agency: to talk about the middle class, to protect the poor, and to focus on “the future.” That is why, as Clinton was finishing his speech, he said that, “If you want a future of shared prosperity, where the middle class is growing and poverty is declining… you have to vote for Obama.”[71] Or that Democrats “think the country works better with a strong middle class.” Or that Republicans want to cut programs “that help the middle class and poor children,” which, of course, is true. But the statement neglects the problematic context that while Democrats may not necessarily “cut” these programs (though again, the evidence of this is scant, but let’s imagine as a hypothetical), the Democrats do continue to create the social conditions in which the middle class and poor struggle more, and thus, become more dependent upon various programs of support. It’s sort of like saying that, “After my opponent beats you with a stick, he won’t let you have a bandaid… But after I beat you with a stick, I at least give you a bandaid.”

Brand Obama: No ‘Hope’ in Hell for ‘Change’

Since the public relations industry runs election campaigns and a good deal of public politics, it only makes sense that the industry itself acknowledges this fact. When it came to Obama’s 2008 election campaign, the public relations and advertising industry were completely ecstatic. Before even being elected president, Obama won the Advertising Age’s “marketer of the year” award for 2008, winning the vote of hundreds of marketers, agency heads and other industry representatives at the annual conference of the Association of National Advertisers. Obama’s campaign of “hope” and “change” beat Apple for the coveted prize that year. The Vice President of Rodale marketing solutions stated, “I honestly look at [Obama’s] campaign and I look at it as something that we can all learn from as marketers.”[72]

At the Cannes Lion International Advertising Awards in June of 2009, the Obama campaign claimed two of the top awards at the prestigious international advertising and public relations industry awards. His campaign won the Titanium grand prix award, for which the criteria is an advertising campaign that is “provocative, challenges assumptions and points to a new direction.” For example, “hope” and “change.” The Titanium award, according to the organizers at the Cannes ceremony, “celebrates work that causes the industry to stop in its tracks and reconsider the way forward.” The other coveted prize that the Obama advertising campaign received was the Integrated Lions award, referring to a campaign that uses three or more media, such as the press, Internet and television, which is “high standard and state-of-the-art.”[73] One advertising executive commented, “They turned (political advertising) from being one dimensional to something the whole country could contribute to. It was a fantastic idea.” Another advertising executive stated, “it was effective. You couldn’t ignore it. There will never be a political campaign that doesn’t use these tools.”[74]

That same month, Obama’s White House Press Secretary Robert Gibbs received the Public Relations Professional of the Year award from the Public Relations Society of America (PRSA), “for his groundbreaking use of new communications techniques and technologies, as well as successful delivery of campaign messages to a broad electorate.” The chairman and CEO of the PRSA, delivered the award to Gibbs, stating, “Robert Gibbs and his team revolutionized the way presidential candidates speak to voters by engaging best practices in current communications techniques and technologies,” adding: “He transformed static, one-way messaging into a dynamic dialogue to engage an expansive electorate like never before.” Upon accepting the award, Gibbs explained that his campaign had to “focus on the message of change being communicated by our candidate… we knew our success depended on our ability to stay focused on that message and relay it honestly and consistently to people across the country.”[75]

“You Have to Treat Them Like Children” – Franklin D. Roosevelt

Whether Bill Clinton, George Bush, Barack Obama or Mitt Romney, they are all parasites, whose purpose is to manipulate the public into granting them the “consent” to govern, while they govern for the benefit of corporations and banks to plunder, exploit, and profit at the expense of the population, both at home and around the world, which is often facilitated through war, coups, repression of liberation movements, genocide, and impoverishment. To these people, the public – you and I – are nothing but a “bewildered herd” of “ignorant and meddlesome outsiders” who must be kept as the “interested spectators of action.” The more talented a politician is at “manufacturing consent,” the more praise he or she gets from the media, and thus, from the public, itself. It is important to expose the spectacle of “public relations politics” so that we can look underneath the surface of power, and understand the real functions and structure of our society, and thus, we can be more capable of changing it. To take a quote from Bill Clinton out of context when he spoke at the Democratic National Convention, “It’s important, because a lot of people believe this stuff.” When he said this, he was referring to the views of Republicans, but the quote is revealing of Clinton’s arrogance and indeed, his talent as a manipulator of the public mind, because it applies precisely to a public relations event like the Democratic National Convention itself: “a lot of people believe this stuff.”

It seems that it is time that people now place their beliefs in more tangible, factual, and logical realities. As children, we were told fairy tales; as adults, we believe fairy tales. Just as Franklin D. Roosevelt said of Latin Americans back in the early 20th century, “You have to treat them like children.” Well that applies to their view of the domestic population as well. Even though our political parasites continue to treat us like children, we have the choice – and the capacity – to act like adults. That means that we have to begin by dismantling the fairy tales that we believe in. Parents know that there comes a time when they must tell their children that there is no Santa Claus, and while this reality may be difficult for the children at first to accept, they are able to deal with that reality, and intellectually evolve and mature beyond it. People as a whole have the same capacity. Whether or not we utilize that capacity is entirely up to us, because our politicians have no interest in doing so, nor will they. It is up to us to dismantle the mythology ourselves.

The most effective way to do this is to take a very practical and logical first step of applying the same standards to our own society that we apply to others. In other words, instead of pointing to the crimes of state-sanctioned “enemies,” instead of blaming either Republicans or Democrats for all the woes of society, one must engage in social self-reflectionand apply the exact same method of inquiry into the ideas, individuals and institutions of our “enemies” as we do to our own ideas, individuals, and institutions.

I think it’s relatively safe to assume that most people would not want a mass murderer as a close friend, but for some reason, millions of people cheer and applaud mass murderers as their leaders. This obviously has no basis in logic. If mass murder is wrong and immoral, those who commit it or participate in it are also immoral. When someone has clearly demonstrated their capacity for immorality – and their willingness to commit mass atrocities – as Clinton, Bush, and Obama all have, it does not make any logical sense to support these people on other claims of “morality” such as: gay rights, family values, abortion, etc. These are designed specifically as issues which limit the political discourse, which remove any discussion of empire, war, mass murder, genocide, corruption, impoverishment, the dismantling of rights and freedoms, torture, assassinations, coups, exploitation, environmental devastation, surveillance and the construction of a police state apparatus. These divisive issues, which in a functioning democracy would have been solved almost immediately, are designed to facilitate a back-and-forth between Republicans and Democrats, to distract the “bewildered herd” with only a few acceptable issues of discussion. Thus, anyone who raises other issues, of much greater relevance, ends up sounding like a Martian; they are perceived as suffering from some sort of “fringe” insanity. But insanity is not “fringe,” insanity is very much mainstream.

If, by chance, issues like war are raised in the political discourse – and most especially during advertising campaigns (which we commonly refer to as “election campaigns”) – then the critique of war policies are themselves confined to an “acceptable” discourse: either the war was a “success”, or it was a “tactical failure.” This implies, immediately, that the objectives of war are always inherently good, because if we wage war, it must be with good intentions. The morality of war – and the reality of empire – are not to be questioned.

When Obama was campaigning for president in 2008, he wrote an op-ed for the New York Times in which he referred to the Iraq war as a “distraction” for which he would make “tactical adjustments.” He wrote that the Iraq war was a “strategic blunder.”[76] That “strategic blunder” led to the deaths of over one million Iraqis between 2003 and 2008.[77] Yet, Obama was given praise for his “enlightened” critique of the Iraq war.

We must apply very basic standards of human decency to those who parade about as our leaders and saviors. An enormous amount of effort is put into preventing people from assessing political leadership in a logical, coherent, and rational manner. That is what the public relations industry does. Politicians are products to be marketed, bought and sold, and like most modern products, they fall apart quickly and have to be replaced. We have to begin questioning our political consumption patterns, otherwise we won’t change them, and it is glaringly obvious that what we have, simply isn’t working.

Watching Bill Clinton speak at the Democratic National Convention reminded me of why I don’t watch political speeches. The man stood up on stage for nearly an hour, and talked about how he cared about what poor families will do if the Republicans come to power, that Obama has fixed the economy, and he even felt it necessary to literally state, “Look, I love our country so much,” just in case you had any doubts. Clinton reached divine levels of absurdity and double-think when he stated:

If you want a future of shared prosperity, where the middle class is growing and poverty is declining, where the American dream is really alive and well again and where the United States maintains its leadership as a force for peace and justice and prosperity in this highly competitive world, you have to vote for Barack Obama.[78]

Considering that none of those fantasies exist under Republicans or Democrats, let alone Clinton or Obama, I will simply end with my favourite quote from Clinton during his speech: “a lot of people believe this stuff.” Let’s hope not for long.

Andrew Gavin Marshall is an independent researcher and writer based in Montreal, Canada, writing on a number of social, political, economic, and historical issues. He is also Project Manager of The People’s Book Project. He also hosts a weekly podcast show, “Empire, Power, and People,” on BoilingFrogsPost.com.

Notes

[1]            Ryan Lizza, “Clinton’s Speech: The Power of a Hug,” The New Yorker – News Desk, 6 September 2012:

http://www.newyorker.com/online/blogs/newsdesk/2012/09/bill-clinton-convention-speech-the-power-of-a-hug.html

[2]            Konrad Yakabuski, “Clinton gives a boost to Obama’s middle-class-hero image,” The Globe and Mail, 5 September, 2012:

http://www.theglobeandmail.com/news/world/us-election/clinton-gives-a-boost-to-obamas-middle-class-hero-image/article4522804/

[3]            David Giambusso, “Congressman Pascrell: Bill Clinton’s speech tonight is ‘his comeback’,” The Star-Ledger, 5 September 2012:

http://www.nj.com/news/index.ssf/2012/09/bill_clinton_hits_the_stump_fo.html

[4]            Dan Balz and Philip Rucker, “Bill Clinton offers forceful defense of Obama’s record,” The Washington Post, 5 September 2012:

http://www.washingtonpost.com/politics/bill-clinton-will-highlight-convention-tonight/2012/09/05/f6d5dcf2-f797-11e1-8398-0327ab83ab91_story.html

[5]            Mark Gollom, “Obama turns to ‘rock star’ Bill Clinton to boost support,” CBC News, 5 September 2012:

http://www.cbc.ca/news/politics/story/2012/09/05/democratic-convention-clinton-obama.html

[6]            Natalie Finn, “Bill Clinton at the Democratic National Convention: Celebs React to Teleprompter-Busting Speech,” E! News, 6 September 2012:

http://ca.eonline.com/news/343617/bill-clinton-at-the-democratic-national-convention-celebs-react-to-teleprompter-busting-speech

[7]            Rebecca Shapiro, “Bill Clinton Media Reactions: Pundits Praise Former President’s DNC Speech, Some Criticize Length,” Huffington Post, 6 September 2012:

http://www.huffingtonpost.com/2012/09/05/bill-clinton-media-reactions-dnc-speech_n_1859892.html

[8]            Rachel Maddow, “’The Rachel Maddow Show’ for Thursday, August 2nd, 2012,” NBC News, 2 August 2012:

http://www.msnbc.msn.com/id/48492324/ns/msnbc-rachel_maddow_show/t/rachel-maddow-show-thursday-august-nd/#.UDXF-ERQhgA

[9]            Josh Halliday, “Burson-Marsteller: PR firm at centre of Facebook row,” The Guardian, 12 May 2011:

http://www.guardian.co.uk/media/2011/may/12/burson-masteller-pr-firm-facebook-row

[10]            Edward Bernays, Propaganda (New York: Ig Publishing, 1928), page 37.

[11]            Andrew Gavin Marshall, “Power, Propaganda, and Purpose in American Democracy,” AndrewGavinMarshall.com, 18 January 2012:

https://andrewgavinmarshall.com/2012/01/18/power-propaganda-and-purpose-in-american-democracy/

[12]            Ibid.

[13]            Ibid.

[14]            Bruce Cummings, “Trilateralism and the New World Order,” World Policy Journal, Vol. 8, No. 2, Spring 1991, page 206.

[15]            Andrew Gavin Marshall, “Punishing the Population: The American Occupations of Haiti and the Dominican Republic,” AndrewGavinMarshall.com, 21 February 2012:

https://andrewgavinmarshall.com/2012/02/21/punishing-the-population-the-american-occupations-of-haiti-and-the-dominican-republic/

[16]            Ibid.

[17]            NYT, “Transcript of Bill Clinton’s Speech to the Democratic National Convention,” The New York Times, 5 September 2012:

http://www.nytimes.com/2012/09/05/us/politics/transcript-of-bill-clintons-speech-to-the-democratic-national-convention.html?pagewanted=all

[18]            Morris Morley and Chris McGillion, “”Disobedient” Generals and the Politics of Redemocratization: The Clinton Administration and Haiti,” Political Science Quarterly, Vol. 112, No. 3, Autumn 1997; David Malone, “Haiti and the international community: A case study,” Survival, Vol. 39, Issue 2, 1997; Scott Turner, “The Dilemma of Double Standards in U.S. Human Rights Policy,” Peace & Change, Vol. 28, No. 4, October 2003.

[19]            Ibid.

[20]            Ibid.

[21]            Helene Cooper and Mark Landler, “U.S. Mulls Role in Haiti After the Crisis,” The New York Times, 17 January 2010:

http://www.nytimes.com/2010/01/18/world/americas/18policy.html

[22]            Andrew Gavin Marshall, “Economic Warfare and Strangling Sanctions: Punishing Iran for its “Defiance” of the United States,” AndrewGavinMarshall.com, 6 March 2012:

https://andrewgavinmarshall.com/2012/03/06/economic-warfare-and-strangling-sanctions-punishing-iran-for-its-defiance-of-the-united-states/

[23]            Najmeh Bozorgmehr, “Sanctions take toll on Iran’s sick,” The Financial Times, 4 September 2012:

http://www.ft.com/intl/cms/s/0/43abcb36-f5cc-11e1-a6bb-00144feabdc0.html#axzz25dqZrNTh

[24]            Andrew Gavin Marshall, “Economic Warfare and Strangling Sanctions: Punishing Iran for its “Defiance” of the United States,” AndrewGavinMarshall.com, 6 March 2012:

https://andrewgavinmarshall.com/2012/03/06/economic-warfare-and-strangling-sanctions-punishing-iran-for-its-defiance-of-the-united-states/

[25]            Molly Moorhead, “Bill Clinton’s night at the Democratic convention,” PolitiFact, 5 September 2012:

http://www.politifact.com/truth-o-meter/article/2012/sep/05/Bill-Clinton-Democratic-convention/

[26]            NYT, “Transcript of Bill Clinton’s Speech to the Democratic National Convention,” The New York Times, 5 September 2012:

http://www.nytimes.com/2012/09/05/us/politics/transcript-of-bill-clintons-speech-to-the-democratic-national-convention.html?pagewanted=all

[27]            Andrew Gavin Marshall, “The Great Global Debt Depression: It’s All Greek To Me,” AndrewGavinMarshall.com, 15 July 2012:

https://andrewgavinmarshall.com/2011/07/15/167/

[28]            Ibid.

[29]            Ibid.

[30]            Reuters, “Justice Department will not prosecute Goldman Sachs, employees for Abacus deal,” Reuters, 9 August 2012:

http://www.reuters.com/article/2012/08/09/us-usa-goldman-no-charges-idUSBRE8781LA20120809

[31]            Andrew Clark, “Bankers and academics at top of donor list,” The Guardian, 8 November 2008:

http://www.guardian.co.uk/world/2008/nov/08/barackobama-wallstreet-bankers-campaign-donations-goldmansachs

[32]            Tracy Greenstein, “The Fed’s $16 Trillion Bailouts Under-reported,” Forbes, 20 September 2011:

http://www.forbes.com/sites/traceygreenstein/2011/09/20/the-feds-16-trillion-bailouts-under-reported/

[33]            James Vicini, “Supreme Court permits no limits on state campaign funds,” Reuters, 25 June 2012:

http://www.reuters.com/article/2012/06/25/us-usa-campaign-court-idUSBRE85O0P520120625

[34]            Jonathan D. Salant, “JPMorgan Employees Join Goldman Sachs Among Top Obama Donors,” Bloomberg, 21 March 2012:

http://www.bloomberg.com/news/2012-03-20/jpmorgan-employees-join-goldman-sachs-among-top-obama-donors.html

[35]            Greg Giroux and Jonathan D. Salant, “Obama Outspends Romney 2-1 With $43 Million in Funds for Ads,” Bloomberg, 21 July 2012:

http://www.bloomberg.com/news/2012-07-20/obama-raises-45-9-million-in-june-to-33-million-for-romney-1-.html

[36]            Peter Nicholas and Daniel Lippman, “Wall Street Is Still Giving to President,” The Wall Street Journal, 3 July 2012:

http://online.wsj.com/article/SB10001424052702303933404577500810740985338.html

[37]            NYT, “Transcript of Bill Clinton’s Speech to the Democratic National Convention,” The New York Times, 5 September 2012:

http://www.nytimes.com/2012/09/05/us/politics/transcript-of-bill-clintons-speech-to-the-democratic-national-convention.html?pagewanted=all

[38]            Jackie Calmes, “Bad Banks, Big Bailouts and Bruises,” The New York Times, 24 July 2012:

http://www.nytimes.com/2012/07/25/books/bailout-by-neil-barofsky.html?pagewanted=all

[39]            Deborah Solomon, “Neil Barofsky, the Democrat Taking Digs at Obama,” Bloomberg, 12 July 2012:

http://www.businessweek.com/articles/2012-07-12/neil-barofsky-the-democrat-taking-digs-at-obama

[40]            AP, “Clinton, Obama threaten to withdraw from NAFTA,” CBC News, 27 February 2008: http://www.cbc.ca/world/usvotes/story/2008/02/27/debate-nafta.html

[41]            CTV, “Obama campaign mum on NAFTA contact with Canada,” CTV News, 29 February 2008:

http://www.ctvnews.ca/obama-campaign-mum-on-nafta-contact-with-canada-1.279448

[42]            Michael Luo, “Memo Gives Canada’s Account of Obama Campaign’s Meeting on Nafta,” The New York Times, 4 March 2008:

http://www.nytimes.com/2008/03/04/us/politics/04nafta.html

[43]            Laura Carlsen, “Obama Reaffirms Promise to Renegotiate NAFTA,” Huffington Post, 12 January 2012:

http://www.huffingtonpost.com/laura-carlsen/obama-reaffirms-promise-t_b_157316.html

[44]            Canwest News Service, “Obama not likely to renegotiate NAFTA, ex-diplomat says,” Canada.com, 13 November 2008:

http://www.canada.com/vancouversun/news/story.html?id=ae15ed12-326f-4187-8cd1-85ceef892b9a

[45]            Michael D. Shear, “NAFTA Renegotiation Must Wait, Obama Says,” The Washington Post, 20 February 2009:

http://www.washingtonpost.com/wp-dyn/content/story/2009/02/19/ST2009021903268.html

[46]            Donna Marykwas, “Secret Trans-Pacific Partnership trade negotiations creating ‘NAFTA on steroids’,” The Examiner, 24 August 2012:

http://www.examiner.com/article/secret-trans-pacific-partnership-trade-negotiations-creating-nafta-on-steroids

[47]            Lori Wallach, “Trans-Pacific Partnership: Under Cover of Darkness, a Corporate Coup Is Underway,” AlterNet, 29 June 2012:

http://www.alternet.org/story/156059/trans-pacific_partnership%3A_under_cover_of_darkness%2C_a_corporate_coup_is_underway?page=0%2C0

[48]            Zach Carter, “Obama Trade Document Leaked, Revealing New Corporate Powers And Broken Campaign Promises,” The Huffington Post, 13 June 2012:

http://www.huffingtonpost.com/2012/06/13/obama-trade-document-leak_n_1592593.html

[49]            Zach Carter, “Obama Trade Document Leaked, Revealing New Corporate Powers And Broken Campaign Promises,” The Huffington Post, 13 June 2012:

http://www.huffingtonpost.com/2012/06/13/obama-trade-document-leak_n_1592593.html

[50]            Josh Eidelson, “Trans-Pacific Partnership: Larger than NAFTA?,” Salon, 14 June 2012:

http://www.salon.com/2012/06/14/trans_pacific_partnership_larger_than_nafta/

[51]            Lori Wallach, “A Stealth Attack on Democratic Governance,” The American Prospect, 13 March 2012:

http://prospect.org/article/stealth-attack-democratic-governance

[52]            Doug Palmer, “Secrecy needed in trade talks: USTR Kirk,” NBC News, 13 May 2012:

http://www.msnbc.msn.com/id/47405479/ns/world_news-americas/t/secrecy-needed-trade-talks-ustr-kirk/#.UEldH0RQhgA

[53]            PC, “Unfair Trade Deals Becoming Even More Unpopular, U.S. Polling Shows,” Public Citizen: www.citizen.org/documents/polling-memo-july-2011.pdf

[54]            Ewen MacAskill and Dominic Rushe, “OECD says US economy is recovering but income inequality problematic,” The Guardian, 26 June 2012:

http://www.guardian.co.uk/business/2012/jun/26/oecd-us-economy-income-inequality

[55]            “Income inequality: Who exactly are the 1%?” The Economist, 21 January 2012:

http://www.economist.com/node/21543178

[56]            Aaron Task, “The ‘American Dream’ Is a Myth: Joseph Stiglitz on ‘The Price of Inequality’,” Yahoo! Finance, 8 June 2012:

http://finance.yahoo.com/blogs/daily-ticker/american-dream-myth-joseph-stiglitz-price-inequality-124338674.html

[57]            Gus Lubin, “23 Mind-Blowing Facts About Income Inequality In America,” Business Insider, 7 November 2011:

http://www.businessinsider.com/new-charts-about-inequality-2011-11#

[58]            Leigh Ann Caldwell, “Obama backtracks on comments that private sector is doing “fine”,” CBS News, 8 June 2012:

http://www.cbsnews.com/8301-503544_162-57449822-503544/obama-backtracks-on-comments-that-private-sector-is-doing-fine/?tag=contentMain;contentBody

[59]            AFP, “Fortune 500 smash profit record; Exxon back on top,” AFP, 7 May 2012:

http://www.google.com/hostednews/afp/article/ALeqM5gbj6XIng0Cu2YL2nn9uBvWN74EgA?docId=CNG.3b6426af1a176d2c5108891890072a79.101

[60]            Christina Rexrode and Bernard Condon, “Record profits for big companies spur 6% rise in CEO pay,” Seattle Times, 25 May 2012:

http://seattletimes.com/html/businesstechnology/2018290135_usceopay26.html

[61]            Ylan Q. Mui, “Americans saw wealth plummet 40 percent from 2007 to 2010, Federal Reserve says,” The Washington Post, 11 June 2012:

http://www.washingtonpost.com/business/economy/fed-americans-wealth-dropped-40-percent/2012/06/11/gJQAlIsCVV_story.html

[62]            Timothy Williams, “As Public Sector Sheds Jobs, Blacks Are Hit Hardest,” The New York Times, 28 November 2011:

http://www.nytimes.com/2011/11/29/us/as-public-sector-sheds-jobs-black-americans-are-hit-hard.html

[63]            Zachary Karabell, “The White House and Jeff Immelt on Jobs: Compelling, Infuriating or Simply Irrelevant?” Time Magazine, 15 June 2012:

http://moneyland.time.com/2011/06/15/the-white-house-jeff-immelt-and-jobs-compelling-infuriating-or-simply-irrelevant/

[64]            Zachary Roth, “With jobs czar under fire, new data confirm offshoring trend,” Yahoo! News, 19 April 2011:

http://news.yahoo.com/blogs/lookout/jobs-czar-under-fire-data-confirm-offshoring-trend-155235152.html

[65]            Susanna Kim, “10 Largest Companies on Obama’s Jobs Council Lost 91K Jobs,” ABC News, 12 October 2011:

http://abcnews.go.com/Business/10-largest-companies-obamas-jobs-council-lost-91000/story?id=14714319#.UEmh3kRQhgA

[66]            David Kocieniewski, “G.E.’s Strategies Let It Avoid Taxes Altogether,” The New York Times, 24 March 2011:

http://www.nytimes.com/2011/03/25/business/economy/25tax.html?pagewanted=all

[67]            Stan Greenberg, James Carville, and Erica Seifert, “Shifting the Economic Narrative,” Democracy Corps/Greenberg Quinlan Rosner Research, 11 June 2012:

www.democracycorps.com

[68]            Ibid.

[69]            Ibid.

[69]            Ibid.

[70]            Ibid.

[71]            NYT, “Transcript of Bill Clinton’s Speech to the Democratic National Convention,” The New York Times, 5 September 2012:

http://www.nytimes.com/2012/09/05/us/politics/transcript-of-bill-clintons-speech-to-the-democratic-national-convention.html?pagewanted=all

[72]            Matthew Creamer, “Obama Wins! … Ad Age’s Marketer of the Year,” AdAge, 17 October 2008:

http://adage.com/article/moy-2008/obama-wins-ad-age-s-marketer-year/131810/

[73]            Mark Sweney, “Barack Obama campaign claims two top prizes at Cannes Lion ad awards,” The Guardian, 29 June 2009:

http://www.guardian.co.uk/media/2009/jun/29/barack-obama-cannes-lions

[74]            Theresa Howard, “Obama Campaign Takes Top Ad Prizes,” ABC News, June 2009:

http://abcnews.go.com/Business/Politics/story?id=7947528&page=1#.UEk6zURQhgA

[75]            PRSA, “White House Press Secretary Robert Gibbs Receives Public Relations Professional of the Year Honors From PRSA,” Reuters Press Release, 5 June 2009:

http://pilot.us.reuters.com/article/2009/06/05/idUS121576+05-Jun-2009+BW20090605

[76]            Barack Obama, “My Plan for Iraq,” The New York Times, 14 July 2008:

http://www.nytimes.com/2008/07/14/opinion/14obama.html

[77]            “Iraq conflict has killed a million Iraqis: survey,” Reuters, 30 January 2008:

http://www.reuters.com/article/2008/01/30/us-iraq-deaths-survey-idUSL3048857920080130

[78]            NYT, “Transcript of Bill Clinton’s Speech to the Democratic National Convention,” The New York Times, 5 September 2012:

http://www.nytimes.com/2012/09/05/us/politics/transcript-of-bill-clintons-speech-to-the-democratic-national-convention.html?pagewanted=all

Forging a “New World Order” Under a One World Government

Forging a “New World Order” Under a One World Government
Global Power and Global Government: Part 4
Global Research, August 13, 2009

This article is Part 4 in the series, “Global Power and Global Government,” published by Global Research.

Part 1: Global Power and Global Government: Evolution and Revolution of the Central Banking System
Part 2: Origins of the American Empire: Revolution, World Wars and World Order
Part 3: Controlling the Global Economy: Bilderberg, the Trilateral Commission and the Federal Reserve



Globalization and the New World Order

The 1990s saw the emergence of what was called the New World Order. This was a term that emerged in the early 1990s to describe a more unipolar world, addressing the collapse of the Soviet Union and the newfound role of the United States as the sole and unchallenged global power. The New World Order was meant to represent a new phase in the global political economy in which world authority rested in one place, and for the time, that place was to be the United States.

This era saw the continual expansion and formation of regional blocs, with the formation of the European Union, the signing of the North American Free Trade Agreement (NAFTA) and the creation of the WTO. The World Trade Organization was officially formed in 1995, as the successor to the General Agreements on Tariffs and Trade (GATT), which was formed in 1944 at the Bretton-Woods Conference. The WTO manages the international liberal trading order.

The first Director-General of the WTO was Peter D. Sutherland, who was previously the director general of GATT, former Attorney General of Ireland, and currently is Chairman of British Petroleum and Goldman Sachs International, as well as being special representative of the United Nations secretary-general for migrations. He is also a member of the board of the Royal Bank of Scotland Group, the Foundation Board of the World Economic Forum, goodwill ambassador to the United Nations Industrial Development Organisation, is a member of the Bilderberg Group, and is European Chairman of the Trilateral Commission, and he was presented with the Robert Schuman Medal for his work on European Integration and the David Rockefeller Award of the Trilateral Commission.[1] Clearly, the WTO was an organ of the western banking elite to be used as a tool in expanding and institutionalizing their control over world trade.

The European Superstate

In 1992, the Maastricht Treaty was signed, which officially formed the European Union in 1993. In 1994, the European Monetary Institute (EMI) was formed, with the European Central Bank (ECB) being formed in 1998, and the single European currency, the Euro, debuting in 1999. In 2004, the European Constitution was to be signed by all 25-member states of the EU, which was a treaty to establish a constitution for the entire European Union.

The Constitution was a move towards creating a European superstate, creating an EU foreign minister, and with it, coordinated foreign policy, with the EU taking over the seat of Britain on the UN Security Council, representing all EU member states, forcing the nations to “actively and unreservedly” follow an EU foreign policy; set out the framework to create an EU defence policy, as an appendage to or separate from NATO; the creation of a European Justice system, with the EU defining “minimum standards in defining offences and setting sentences,” and creates common asylum and immigration policy; and it would also hand over to the EU the power to “ensure co-ordination of economic and employment policies”; and EU law would supercede all law of the member states, thus making the member nations relative to mere provinces within a centralized federal government system.[2]

Vaclav Klaus, President of the Czech Republic, had stated that he feared that the concept of a stronger and more centralized European Union, as “the developments in the E.U. are really dangerous with regard to moving out of a free society and moving more and more toward masterminding control and regulation,” and that, “We [the Czech Republic] spent a half-century under communist eyes. We are more sensitive than some other West Europeans. We feel things, we see things, we touch things that we don’t like. For us, the European Union reminds us of COMECON [Moscow’s organization for economic control of the Soviet bloc].” He elaborated saying that the similarity with COMECON is not ideologically based, but in its structure, “The decisions are made not in your own country. For us who lived through the communist era, this is an issue.”[3]

The Constitution was largely written up by Valéry Giscard d’Estaing, former President of the French Republic from 1974 to 1981. Giscard d’Estaing also happens to be a member of the Bilderberg Group, the Trilateral Commission, and is also a close friend of Henry Kissinger, having co-authored papers with him. In 2005, French and Dutch voters answered the referendums in their countries, in which they rejected the EU Constitution, which required total unanimity in order to pass.

In 2007, a move was undertaken to introduce what was called the Lisbon Treaty, to be approved by all member-states. Giscard d’Estaing wrote an article for the Independent in which he stated that, “The difference between the original Constitution and the present Lisbon Treaty is one of approach, rather than content.” He described the process of creating the Lisbon Treaty: “It was the legal experts for the European Council who were charged with drafting the new text. They have not made any new suggestions. They have taken the original draft constitution, blown it apart into separate elements, and have then attached them, one by one, to existing treaties. The Treaty of Lisbon is thus a catalogue of amendments. It is unpenetrable for the public.” The main difference was that the word “constitution” was removed and banished from the text.[4]

The Telegraph reported that though the Treaty dropped the word “constitution,” it remained the same in “giving the EU the trappings of a global power and cutting national sovereignty.” It contained plans to create an EU President, who “will serve a two and half year term but unlike democratic heads of state he or she will be chosen by Europe’s leaders not by voters” and “will take over key international negotiations from national heads of government.” The Constitution’s “Foreign Minister” becomes the “High Representative,” who “will run a powerful EU diplomatic service and will be more important on the global and European stage than national foreign ministers.” It sets out to create an “Interior Ministry” which will “centralise databases holding fingerprints and DNA,” and “make EU legislation on new police and surveillance powers.” The ability for EU nations to use vetoes will end, and the Treaty “includes a clause hardwiring an EU “legal personality” and ascendancy over national courts.”[5]

One country in Europe has it written into its constitution that it requires a referendum on treaties, and that country is Ireland. In June of 2008, the Irish went to vote on the Treaty of Lisbon, after weeks and months of being badgered by EU politicians and Eurocrats explaining that the Irish “owe” Europe a “Yes” vote because of the benefits the EU had bestowed upon Ireland. History will show, however, that the Irish don’t take kindly to being bossed around and patronized, so when they went to the polls, “No” was on their lips and on their ballots. The Irish thus rejected the Lisbon Treaty.

North American Integration

The Canada-US Free Trade Agreement of 1989, was signed by President George HW Bush and Canadian Prime Minister Brian Mulroney. The FTA had devastating consequences for the people of Canada and the United States, while enriching the corporate and political elite. For example, GDP growth decreased, unemployment increased the most since the Great Depression,[6] and meanwhile, Brian Mulroney entered the corporate world, of which he now sits as a board member of Barrick Gold Corporation, as well as sitting on the International Advisory Board of the Council on Foreign Relations,[7] of which David Rockefeller remains on as Honorary Chairman.

In 1990, the private sector lobbying groups and think tanks began the promotion of the North American Free Trade Agreement (NAFTA) to expand the Canada-US Free Trade Agreement to include Mexico. NAFTA was signed by then Canadian Prime Minister Jean Chrétien, US President George H.W. Bush and Mexican President Carlos Salinas, in 1993, and went into effect in 1994. It was negotiated during a time in which Mexico was undergoing liberal economic reforms, so NAFTA had the effect of cementing those reforms in an “economic constitution for North America.”[8]

David Rockefeller played a role in the push for NAFTA. In 1965, he had founded the Council for Latin America (CLA), which, as he wrote in a 1966 article in Foreign Affairs, was to mobilize private enterprise throughout the hemisphere “to stimulate and support economic integration.” The CLA, David wrote, “provides an effective channel of cooperation between businessmen in the United States and their counterparts in the countries to the south. It also offers a means of continuing communication and consultation with the White House, the State Department and other agencies of our government.”[9]

The CLA later changed its name to the Council of the Americas (CoA) and maintains a very close relationship with the Americas Society, founded at the same time as the CLA, of which David Rockefeller remains to this day as Chairman of both organizations. As David wrote in his autobiography, Memoirs, in the lead up to NAFTA, the Council of the Americas sponsored a Forum of the Americas, which was attended by President George H.W. Bush, which resulted in the call for a “Western Hemisphere free trade area.”[10]

In 1993, David Rockefeller wrote an article for the Wall Street Journal, in the run up to NAFTA, in which he advocated for the signing of NAFTA as essential, describing it as a vital step on the road to fulfilling his life long work, and that, “Everything is in place — after 500 years — to build a true “new world” in the Western Hemisphere,” and further, that “I truly don’t think that “criminal” would be too strong a word to describe an action on our part, such as rejecting Nafta, that would so seriously jeopardize all the good that has been done — and remains to be done.”[11]

In 1994, Mexico entered into a financial crisis, often referred to as the Mexican peso crisis. The 1980s debt crisis, instigated by the Federal Reserve’s interest rate hikes on international loans, caused Mexico to default on its loans. The IMF had to enter the scene with its newly created Structural Adjustment Programs (SAPs) and reform Mexico’s economy along neoliberal economic policies.

In the late 1980s, “the United States accounted for 73 percent of Mexico’s foreign trade,”[12] and when NAFTA came into effect in 1994, it “immediately opened US and Canadian markets to 84 percent of Mexican exports.”[13] Mexico even became a member of the World Trade Organization (WTO). The peso crisis, which began at the end of 1994, with the ascension of Mexican President Zedillo, went into 1995, and the US organized a bailout worth $52 billion.[14] The bailout did not help the Mexican economy, as it was simply funneled into paying back loans to banks, primarily American banks, and the “crisis in 1995 was declared [by the IMF to be] over as soon as the banks and international lenders started to get repaid; but five years after the crisis, workers were just getting back to where they were beforehand.”[15]

In 2002, Robert Pastor, Director of the Center for North American Studies at the American University in Washington, D.C., prepared a report that he presented to the Trilateral Commission meeting of that same year. The report, A North American Community: A Modest Proposal to the Trilateral Commission, advocated a continuation of the policy of “deep integration” in North America, recommending, “a continental plan for infrastructure and transportation, a plan for harmonizing regulatory policies, a customs union, [and] a common currency.”[16] The report advocated the formation of a North American Community and Pastor wrote that, “a majority of the public in all three countries is prepared to join a larger North American country.”[17]

In 2003, prior to Paul Martin becoming Prime Minister of Canada, the Canadian Council of Chief Executives (CCCE), formerly the BCNI, published on their website, a press release in which they, “urged Paul Martin to take the lead in forging a new vision for North America.” Thomas d’Aquino, CEO of the Council, “urged that Mr. Martin champion the idea of a yearly summit of the leaders of Canada, Mexico and the United States in order to give common economic, social and security issues the priority they deserve in a continental, hemispheric and global context.” Among the signatories to this statement were all the Vice Chairmen of the CCCE, including David Emerson, who would go on to join Martin’s Cabinet.[18]

The CCCE then launched the North American Security and Prosperity Initiative, advocating “redefining borders, maximizing regulatory efficiencies, negotiation of a comprehensive resource security pact, reinvigorating the North American defence alliance, and creating a new institutional framework.”[19]

The Independent Task Force on the Future of North America was then launched in 2005, composed of an alliance and joint project between the CCCE in Canada, the Council on Foreign Relations (CFR) in the United States, and the Mexican Council on Foreign Relations in Mexico. A press release was given on March 14, 2005, in which it said, “The chairs and vice-chairs of the Independent Task Force on the Future of North America today issued a statement calling for a North American economic and security community by 2010.”[20]

On March 23, 2005, a mere nine days following the Task Force press release, the leaders of Canada, the US, and Mexico, (Paul Martin, George W. Bush, and Vicente Fox, respectively), announced “the establishment of the Security and Prosperity Partnership of North America,” which constituted a course of “action into a North American framework to confront security and economic challenges.”[21]

Within two months, the Independent Task Force on the Future of North America released their final report, Building a North American Community, proposing the continuation of “deep integration” into the formation of a North American Community, that “applauds the announced ‘Security and Prosperity Partnership of North America,’ but proposes a more ambitious vision of a new community by 2010 and specific recommendations on how to achieve it.”[22]

At the 2006 meeting of the SPP, the creation of a new group was announced, called the North American Competitiveness Council (NACC), made up of corporate leaders from all three countries who produce an annual report and advise the three governments on how to implement the SPP process of “deep integration”. The Secretariat in Canada is the CCCE, and the Secretariat of the group in the US is made up of the US Chamber of Commerce and the Council of the Americas.[23] The Council of the Americas was founded by David Rockefeller, of which he is still Honourary Chairman, and other board members include individuals from J.P. Morgan, Merck, McDonald’s, Ford, the Federal Reserve Bank of New York, General Electric, Chevron, Shell, IBM, ConocoPhillips, Citigroup, Microsoft, Pfizer, Wal-Mart, Exxon, General Motors, Merrill Lynch, Credit Suisse and the US Department of Treasury.[24]

The process of integration is still underway, and the formation of a North American Community is not far off, only to be followed by a North American Union, modeled on the structure of the European Union, with talk of a North American currency being formed in the future,[25] which was even proposed by Canada’s former Governor of the Bank of Canada.[26]

The New World Order in Theory

In a 1997 article of Foreign Affairs, the journal of the Council on Foreign Relations, Anne-Marie Slaughter discussed the theoretical foundations of the New World Order. Building on George HW Bush’s proclamation of a New World Order in 1991, Slaughter wrote that many saw this as “the promise of 1945 fulfilled, a world in which international institutions, led by the United Nations, guaranteed international peace and security with the active support of the world’s major powers.” However, this concept, she explained, was largely infeasible, as “It requires a centralized rule-making authority, a hierarchy of institutions, and universal membership.” Instead, she explains the emergence of what she called a “new medievalism” as opposed to liberal internationalism. “Where liberal internationalists see a need for international rules and institutions to solve states’ problems, the new medievalists proclaim the end of the nation-state,” where “The result is not world government, but global governance. If government denotes the formal exercise of power by established institutions, governance denotes cooperative problem- solving by a changing and often uncertain cast.”[27]

However, Slaughter challenges the assumptions of both the liberal internationalists and the new medievalists, and states that, “The state is not disappearing, it is disaggregating into its separate, functionally distinct parts. These parts—courts, regulatory agencies, executives, and even legislatures—are networking with their counterparts abroad, creating a dense web of relations that constitutes a new, transgovernmental order,” and that, “transgovernmentalism is rapidly becoming the most widespread and effective mode of international governance.”[28] Slaughter was Dean of the Woodrow Wilson School of Public and International Affairs at Princeton University from 2002-2009, is currently Director of Policy Planning for the United States Department of State, and has previously served on the board of the Council on Foreign Relations.

Reconstructing Class Structure Under a World Government

Bank of Canada Governor Mark Carney, a former executive with Goldman Sachs, stated in his speech at the International Economic Forum of the Americas, that, “Globalized product, capital, and labour markets lie at the heart of the New World Order to which we should aspire. However, the next wave of globalization needs to be more firmly grounded and its participants more responsible,” and that, “Within our economies, major stock adjustments in inventories, labour, and capital will be required.” It is worth quoting him at length in saying:

Although global demand and trade levels appear to be approaching bottom, and inventory and labour adjustments have already been substantial, there is still more to come. Unemployment will likely rise further across the G-7, with the sharpest increases still to come in those economies with the least-flexible labour markets. Uncertainty over the employment outlook will weigh on consumption in most major economies for some time. The capital stock adjustment process will take longer, and global investment growth is likely to remain negative well into 2010. This will serve as a significant drag on global growth and can be expected to reduce potential growth in most major economies.[29] [Emphasis added]

In terms of labour adjustments within the New World Order, there are some important and vital factors to take into account. Primary among these concerns is the notion of transnational classes. Capitalism largely functions through class divides, with the ruling class owning the means of production, which, as a class, is subject to its own hierarchy over which those that control and issue currencies preside.

In Western, industrialized nations, there has been a large middle class which thrives on consumption, enriching the upper class bourgeoisie, while the lower class, (or proletariat in Marxist terms), consists of the labour class. In non-western, industrialized nations, generally referred to as the “Third World”, “developing world” or the “Global South” (consisting of Latin America, Africa, and parts of Asia), there is a greater divide in terms in class lines, where there is a ruling class, and a labour class, largely remaining vacant of a vast, educated middle class. Class structures vary from country to country and region to region.

However, in the past several decades, the reality of class structures has been undergoing drastic changes, and with this, the structure of labour has changed. In the past few decades, a concurrent class restructuring has been taking place, in which the middle classes of the world descend into debt bondage while the upper classes of the world have began a process of transnationalizing. What we have witnessed and are witnessing with recent events, is the transnationalization of class structures, and with that, labour forces.

Social Constructivism

A fascinating theoretical school of thought within the field of Global Political Economy is that of Social Constructivism. Social Constructivists argue that, “The social and political world, including the world of international relations, is not a physical entity or material object that is outside human consciousness. Consequently, the study of international relations must focus on the ideas and beliefs that inform the actors on the international scene as well as the shared understandings between them.” Expanding upon this idea:

The international system is not something ‘out there’ like the solar system. It does not exist on its own. It exists only as an intersubjective awareness among people; in that sense the system is constituted by ideas, not by material forces. It is a human invention or creation not of a physical or material kind but of a purely intellectual and ideational kind. It is a set of ideas, a body of thought, a system of norms, which has been arranged by certain people at a particular time and place.

Examples of socially constructed structures within the global political economy are national borders, as they have no physical line, but are rather formed by a shared understanding between various actors as to where the border is. The nation itself is a social construct, as it has no physical, over-arching form, but is made up of a litany of shared values, ideas, concepts, institutions, beliefs and symbols. Thus, “If the thoughts and ideas that enter into the existence of international relations change, then the system itself will change as well, because the system consists in thoughts and ideas. That is the insight behind the oft-repeated phrase by constructivist Alexander Wendt: ‘anarchy is what states make of it’.”[30]

Class Structure and Social Constructivism

William I. Robinson and Jerry Harris write in Science & Society Journal, that, “One process central to capitalist globalization is transnational class formation, which has proceeded in step with the internationalization of capital and the global integration of national productive structures. Given the transnational integration of national economies, the mobility of capital and the global fragmentation and decentralization of accumulation circuits, class formation is progressively less tied to territoriality.”[31] They argued that a Transnational Capitalist Class (TCC) has emerged, “and that this TCC is a global ruling class. It is a ruling class because it controls the levers of an emergent transnational state apparatus and of global decision making.”[32] This class has no borders, and is composed of the technocratic, media, corporate, banking, social and political elite of the world.

As Jackson and Sorenson point out in relation to social constructivist theory, “If ‘anarchy is what states make of it’ there is nothing inevitable or unchangeable about world politics,” and that, “The existing system is a creation of states and if states change their conceptions of who they are, what their interests are, what they want, etc. then the situation will change accordingly.” As an example, they stated that states could decide “to reduce their sovereignty or even to give up their sovereignty. If that happened there would no longer be an international anarchy as we know it. Instead, there would be a brave new, non-anarchical world – perhaps one in which states were subordinate to a world government.”[33]

As Robinson and Harris explain in their essay, with the rise of the Transnational Capitalist Class (TCC), there is also a rise in the apparatus of a Transnational State (TNS), which is “an emerging network that comprises transformed and externally integrated national states, together with the supranational economic and political forums; it has not yet acquired any centralized institutional form.”[34] Among the economic apparatus of the TNS we see the IMF, World Bank, WTO and regional banks. On the political side we see the Group of 7, Group of 22, United Nations, OECD, and the European Union. This was further accelerated with the Trilateral Commission, “which brought together transnationalized fractions of the business, political, and intellectual elite in North America, Europe, and Japan.” Further, the World Economic Forum has made up an important part of this class, and, I might add, the Bilderberg Group. Robinson and Harris point out that, “Studies on building a global economy and transnational management structures flowed out of think tanks, university centers, and policy planning institutes in core countries.”[35]

The TNS apparatus has been a vital principle of organization and socialization for the transnational class, “as have world class universities, transnationally oriented think tanks, the leading bourgeois foundations, such as Harvard’s School of International Business, the Ford [and Rockefeller] and the Carnegie Foundations, [and] policy planning groups such as the Council on Foreign Relations.” These “elite planning groups are important forums for integrating class groups, developing new initiatives, collective strategies, policies and projects of class rule, and forging consensus and a political culture around these projects.”[36]

Robinson and Harris identify the World Economic Forum as “the most comprehensive transnational planning body of the TCC and the quintessential example of a truly global network binding together the TCC in a transnational civil society.”[37] I would take issue with this, and instead propose the Bilderberg Group, of which they make no mention in their article, as THE quintessential transnational planning body of the TCC, as it is composed of the elite of the elite, totally removed from public scrutiny, and acts as “a secretive global think-tank” of the world’s 130 most powerful individuals.[38]

Many Bilderberg critics will claim that the group acts as a “secret world government” or as the organization “that makes all the key decisions for the world.” However, this is not the case. Bilderberg is simply the most influential planning body, sitting atop a grand hierarchy of various planning bodies and institutions, and is itself a key part of the apparatus of the formation of a Transnational State, but is not, in and of itself, a “world government.” It is a global think tank, which holds the concept of a “world government” in high regard and often works to achieve these ends, but it should not be confused with being the end it seeks.

The economic crisis is perhaps the greatest “opportunity” ever given to the TCC in re-shaping the world order according to their designs, ideals and goals. Through destruction, comes creation; and for these high-placed individuals within the TCC, destruction is itself a form of creation.

In terms of reshaping labour and class structures, the economic crisis provides the ground on which a new global class structure will be built. A major problem for the Transnational Capitalist Class and the formation of a Transnational State, or world government, is the lack of continuity in class structures and labour markets throughout the world. A transnational ruling class, or “Superclass” as David Rothkopf referred to it in his book of the same name (and is, himself, a member of the Superclass), has emerged. It has no borders, yet has built a general continuity and consensus of goals among its members, albeit there are differences and conflicts within the class, but they are based upon the means of achieving the stated ends, rather than on the ends itself. There is not dissent within the ruling class on the aims of achieving a world governing body; the dissent is in how to achieve this, and in terms of what kind of structure, theoretical and philosophical leanings, and political orientation such a government would have.

To achieve these ends, however, all classes must be transnationalized, not simply the ruling class. The ruling class is the first class to be transnationalized, because transnationalization was the goal of the ruling classes based in the powerful Western European nations, (and later in the United States), that started the process of transnationalization or internationalization. Now that there is an established “Superclass” of a transnational composition, the other classes must follow suit. The middle class is targeted for elimination in this sense, because most of the world has no middle class, and to fully integrate and internationalize a middle class, this would require industrialization and development in places such as Africa, and certain places in Asia and Latin America, and would represent a massive threat to the Superclass, as it would be a valve through which much of their wealth and power would escape them. Their goal is not to lose their wealth and power to a transnational middle class, but rather to extinguish the notion of a middle class, and transnationalize a lower, uneducated, labour oriented class, through which they will secure ultimate wealth and power.

The economic crisis serves these ends, as whatever remaining wealth the middle class holds is in the process of being eliminated, and as the crisis progresses, or rather, regresses, and accelerates, the middle classes of the world will suffer, while a great percentage of lower classes of the world, poverty-stricken even prior to the crisis, will suffer the greatest, most probably leading to a massive reduction in population levels, particularly in the “developed” or “Third World” states.

Many would take issue with such a thesis as being an objective of the Transnational Capitalist Class, as capitalism needs a large population, specifically a middle class population, in order to have a market of consumers for their products. Though this is true with how we presently understand the capitalist system and structure, we must also take note that capitalism, itself, is always changing and redefining itself. Through a social constructivist perspective, which I would argue, is very apt in this analysis, such a notion is not inconceivable, as if the capitalist class were to redefine capitalism itself, capitalism itself would change.

It must be addressed that there would be a great many individuals within the TCC or Superclass (Rothkopf estimates the number at 6,000 individuals within the ruling class), who would take issue with eliminating their base for profit making, however, as a total restructuring of the capitalist system and global political economy as a whole is undertaken, the TCC itself is not immune to such drastic and rapid changes itself. In fact, it would be unimaginable to think that it would remain as it currently is.

Rothkopf explains that with 6,000 members of the Superclass, that equals roughly one member of the superclass for every 1 million people in the world. As the composition, class structures, and numbers of the world population drastically alter over the next years and decades, so too will the superclass itself. It too, will be subject to a “cleansing” so to speak, in which the big players will collapse and consolidate many of the smaller players.

The Monetary Structure of a Global Government

A Global Currency

Following the April 2009 G20 Summit, leaders issued a communiqué which set the groundwork for the creation of a global currency to replace the US dollar as the world reserve currency. The communiqué stated that, “We have agreed to support a general SDR allocation which will inject $250bn (£170bn) into the world economy and increase global liquidity.” SDRs, or Special Drawing Rights, are “a synthetic paper currency issued by the International Monetary Fund.” As the Telegraph reported, “the G20 leaders have activated the IMF’s power to create money and begin global “quantitative easing”. In doing so, they are putting a de facto world currency into play. It is outside the control of any sovereign body. Conspiracy theorists will love it.”[39]

In 1988, the Economist featured an article called “Get Ready for the Phoenix,” which said, “THIRTY years from now, Americans, Japanese, Europeans, and people in many other rich countries and some relatively poor ones will probably be paying for their shopping with the same currency. Prices will be quoted not in dollars, yen or D-marks but in, let’s say, the phoenix. The phoenix will be favoured by companies and shoppers because it will be more convenient than today’s national currencies, which by then will seem a quaint cause of much disruption to economic life in the late twentieth century.” The article, written in the wake of the 1987 stock market crash, stated that, “Several more big exchange-rate upsets, a few more stockmarket crashes and probably a slump or two will be needed before politicians are willing to face squarely up to that choice. This points to a muddled sequence of emergency followed by patch-up followed by emergency, stretching out far beyond 2018-except for two things. As time passes, the damage caused by currency instability is gradually going to mount; and the very trends that will make it mount are making the utopia of monetary union feasible.”[emphasis added][40]

Paul Volcker, former Governor of the Federal Reserve System, said in 2000, that, “If we are to have a truly global economy, a single world currency makes sense,” and a member of the Executive Board of the European Central Bank reaffirmed Volcker’s comment, stating that, “we might one day have a single world currency. Maybe European integration, in the same way as any other regional integration, could be seen as a step towards the ideal situation of a fully integrated world. If and when this world will see the light of day is impossible to say. However, what I can say is that this vision seems as impossible now to most of us as a European monetary union seemed 50 years ago, when the process of European integration started.”[41]

A Central Bank of the World

Jeffrey Garten has written several articles calling for the creation of a global central bank, or a “global fed.” Garten was former Dean of the Yale School of Management, former Undersecretary of Commerce for International Trade in the Clinton administration, previously served on the White House Council on International Economic Policy under the Nixon administration and on the policy planning staffs of Secretaries of State Henry Kissinger and Cyrus Vance of the Ford and Carter administrations, former Managing Director at Lehman Brothers, and is a member of the Council on Foreign Relations.

In 1998, he wrote an article for the New York Times stating that the world “needs a global central bank,” and that, “An independent central bank with responsibility for maintaining global financial stability is the only way out. No one else can do what is needed: inject more money into the system to spur growth, reduce the sky-high debts of emerging markets, and oversee the operations of shaky financial institutions. A global central bank could provide more money to the world economy when it is rapidly losing steam.”[42]

Following the outbreak of the current financial crisis, Garten wrote an article for the Financial Times in which he called for the “establishment of a Global Monetary Authority to oversee markets that have become borderless.”[43] In October of 2008, he wrote an article for Newsweek stating that, “leaders should begin laying the groundwork for establishing a global central bank.” He explained that, “There was a time when the U.S. Federal Reserve played this role [as governing financial authority of the world], as the prime financial institution of the world’s most powerful economy, overseeing the one global currency. But with the growth of capital markets, the rise of currencies like the euro and the emergence of powerful players such as China, the shift of wealth to Asia and the Persian Gulf and, of course, the deep-seated problems in the American economy itself, the Fed no longer has the capability to lead single-handedly.”[44]

Regionalism

Building upon the model of the European Union, the world is being divided into large continental regional blocs, with regional monetary systems and governments. This will make up the managed blocs of a global government, and mark a significant process in the “hard road to world order,” as Richard N. Gardner called it, in which national sovereignty is eroded piece by piece. Regionalism marks the current phase of the move to the formation of a global government. Friedrich List critiqued liberal cosmopolitanism, stating that economic integration had never preceded political integration, however the elites have and are successfully challenging this notion. In the New World Order, economic integration is preceding political integration into a world governance structure.

The European Union began as a series of free trade agreements, became a monetary union, and is in the process of being formed into a single continental superstate. North American integration began with a series of free trade agreements, defense and security agreements, and is in the process of moving towards monetary and bureaucratic integration into a North American Community. A Union and North American superstate are not far in the distance. A North American currency is openly discussed and proposed by leading think tanks, billionaire investors, as well as the Governor of the Bank of Canada. The likely name of such a currency is the Amero.[45]

Meanwhile, globally, markets are heavily integrating. In 2007, it was reported that the European Union and the United States were beginning the process of transatlantic economic integration.[46] In 2008, it was announced that, “Canadian and European officials say they plan to begin negotiating a massive agreement to integrate Canada’s economy with the 27 nations of the European Union,” under “deep economic integration negotiations,” and “The proposed pact would far exceed the scope of older agreements such as NAFTA.”[47] This, essentially, is a means of integrating with the North American Community before the Community is officially formed; an act of pre-emptive integration.

In 2007, the Council on Foreign Relations journal, Foreign Affairs, ran an article titled, “The End of National Currency.” Discussing the volatility of national currencies, the article stated that, “The right course is not to return to a mythical past of monetary sovereignty, with governments controlling local interest and exchange rates in blissful ignorance of the rest of the world. Governments must let go of the fatal notion that nationhood requires them to make and control the money used in their territory. National currencies and global markets simply do not mix; together they make a deadly brew of currency crises and geopolitical tension and create ready pretexts for damaging protectionism. In order to globalize safely, countries should abandon monetary nationalism and abolish unwanted currencies, the source of much of today’s instability.”

Further, “Monetary nationalism is simply incompatible with globalization. It has always been, even if this has only become apparent since the 1970s, when all the world’s governments rendered their currencies intrinsically worthless.” The author states that, “Since economic development outside the process of globalization is no longer possible, countries should abandon monetary nationalism. Governments should replace national currencies with the dollar or the euro or, in the case of Asia, collaborate to produce a new multinational currency over a comparably large and economically diversified area.”[48]

In 2008, the Union of South American Nations (UNASUR) was formed, “a regional body aimed at boosting economic and political integration in the region,”[49] which will “seek a common currency as part of the region’s integration efforts,” as well as a common central bank.[50]

The Gulf Cooperation Council, a regional bloc of Arab Middle Eastern governments, is pursuing economic integration in the form of a common central bank and a common currency.[51] Similarly, there has been much discussion of an Asian Monetary Union and East Asian economic integration, specifically being touted as a solution to the prevention of future economic crises in East Asia like that which hit it in 1997.[52] Integration would be modeled upon the East Asian regional block of ASEAN (Association of Southeast Asian Nations), and in 2008, “ASEAN bank deputy governors and financial deputy ministers have met in Vietnam’s central Da Nang city, discussing issues on the financial and monetary integration and cooperation in the region.”[53] Further, Africa is being organized as a regional bloc under the African Union, and is also pursuing regional economic integration, and has even set the agenda for the creation of a continental African central bank and the formation of a single African currency.[54]

In 2006, the Bank for International Settlements “suggested ditching many national currencies in favour of a small number of formal currency blocks based on the dollar, euro and renminbi or yen.”[55]

Constructing the Political Structure of a Global Government

Strobe Talbott, Deputy Secretary of State in the Clinton administration from 1994 to 2001, is also a member of the Council on Foreign Relations and the Trilateral Commission and is currently President of the Brookings Institution, a prominent US think tank. In 1992, before becoming Deputy Secretary of State, he wrote an article for Time Magazine originally titled, “The Birth of the Global Nation,” which has now, in the Time Magazine archives, been renamed “America Abroad.” In the article, he states that within the next 100 years, “nationhood as we know it will be obsolete; all states will recognize a single, global authority. A phrase briefly fashionable in the mid-20th century — “citizen of the world” — will have assumed real meaning by the end of the 21st.”

Interestingly, Talbott endorses the social constructivist perspective of nation-states and international order, stating that, “All countries are basically social arrangements, accommodations to changing circumstances. No matter how permanent and even sacred they may seem at any one time, in fact they are all artificial and temporary. Through the ages, there has been an overall trend toward larger units claiming sovereignty and, paradoxically, a gradual diminution of how much true sovereignty any one country actually has.”

He explained that empires “were a powerful force for obliterating natural and demographic barriers and forging connections among far-flung parts of the world,” and following that, “Empire eventually yielded to the nation-state,” and that, “The main goal driving the process of political expansion and consolidation was conquest. The big absorbed the small, the strong the weak. National might made international right. Such a world was in a more or less constant state of war.” Talbott states that, “perhaps national sovereignty wasn’t such a great idea after all.”

He continued, saying that, “it has taken the events in our own wondrous and terrible century to clinch the case for world government. With the advent of electricity, radio and air travel, the planet has become smaller than ever, its commercial life freer, its nations more interdependent and its conflicts bloodier.” Further, “Each world war inspired the creation of an international organization, the League of Nations in the 1920s and the United Nations in the ’40s.” He explained, “The plot thickened with the heavy-breathing arrival on the scene of a new species of ideology — expansionist totalitarianism — as perpetrated by the Nazis and the Soviets. It threatened the very idea of democracy and divided the world. [Thus] The advocacy of any kind of world government became highly suspect.” However, as Talbott points out, Soviet expansion led the way for NATO expansion, and “The cold war also saw the European Community pioneer the kind of regional cohesion that may pave the way for globalism.”

On top of that, “the free world formed multilateral financial institutions that depend on member states’ willingness to give up a degree of sovereignty. The International Monetary Fund can virtually dictate fiscal policies, even including how much tax a government should levy on its citizens. The General Agreement on Tariffs and Trade regulates how much duty a nation can charge on imports. These organizations can be seen as the protoministries of trade, finance and development for a united world.” In addressing crises, Talbott wrote that, “Globalization has also contributed to the spread of terrorism, drug trafficking, AIDS and environmental degradation. But because those threats are more than any one nation can cope with on its own, they constitute an incentive for international cooperation.” Thus, out of crisis, comes opportunity; out of chaos comes order.

In prescribing a solution, Talbott postulates that, “The best mechanism for democracy, whether at the level of the multinational state or that of the planet as a whole, is not an all-powerful Leviathan or centralized superstate, but a federation, a union of separate states that allocate certain powers to a central government while retaining many others for themselves.”[56]

In a 1974 issue of Foreign Affairs, Richard N. Gardner wrote about the formation of the New World Order. Gardner, a former American ambassador to the United Nations, Italy and Spain, is also a member of the Trilateral Commission. In his article, The Hard Road to World Order, Gardner wrote that, “The quest for a world structure that secures peace, advances human rights and provides the conditions for economic progress—for what is loosely called world order—has never seemed more frustrating but at the same time strangely hopeful.”[57] He explained that, “few people retain much confidence in the more ambitious strategies for world order that bad wide backing a generation ago—‘world federalism,’ ‘charter review,’ and “world peace through world law’.” Further, “The same considerations suggest the doubtful utility of bolding a [UN] Charter review conference.”[58]

Gardner wrote, “If instant world government, Charter review, and a greatly strengthened International Court do not provide the answers, what hope for progress is there? The answer will not satisfy those who seek simple solutions to complex problems, but it comes down essentially to this: The hope for the foreseeable future lies, not in building up a few ambitious central institutions of universal membership and general jurisdiction as was envisaged at the end of the last war, but rather in the much more decentralized, disorderly and pragmatic process of inventing or adapting institutions of limited jurisdiction and selected membership to deal with specific problems on a case-by-case basis, as the necessity for cooperation is perceived by the relevant nations.”

He then stated, “In short, the “house of world order” will have to be built from the bottom up rather than from the top down. It will look like a great “booming, buzzing confusion,” to use William James’ famous description of reality, but an end run around national sovereignty, eroding it piece by piece, will accomplish much more than the old-fashioned frontal assault.”[59]

In the 2001 issue of Foreign Affairs, Richard Falk and Andrew Strauss wrote an article titled, “Toward Global Parliament.” They wrote that, “International governance is no longer limited to such traditional fare as defining international borders, protecting diplomats, and proscribing the use of force. Many issues of global policy that directly affect citizens are now being shaped by the international system. Workers can lose their jobs as a result of decisions made at the WTO or within regional trade regimes.”[60] In 2006, a UN report stated that, “the nation-state is an old-fashioned concept that has no role to play in a modern globalised world.”[61]

Further, “As with citizen groups, elite business participation in the international system is becoming institutionalized. The best example is the World Economic Forum in Davos, Switzerland. In the 1980s, the WEF transformed itself from an organization devoted to humdrum management issues into a dynamic political forum. Once a year, a thousand of the world s most powerful business executives get together with another thousand of the world’s senior policymakers to participate in a week of roundtables and presentations. The WEF also provides ongoing arenas for discussion and recommendations on shaping global policy.” They continue in explaining that, “The Davos assembly and overlapping networks of corporate elites, such as the International Chamber of Commerce, have been successful in shaping compatible global policies. Their success has come in the expansion of international trade regimes, the modest regulation of capital markets, the dominance of neoliberal market philosophy, and the supportive collaboration of most governments, especially those of rich countries.”[62]

In explaining the purpose of a global parliament, essentially to address the “democratic deficit” created by international organizations, the authors wrote that, “Some business leaders would certainly oppose a global parliament because it would broaden popular decision-making and likely press for transnational regulations. But others are coming to believe that the democratic deficit must be closed by some sort of stakeholder accommodation. After all, many members of the managerial class who were initially hostile to such reform came to realize that the New Deal—or its social-democratic equivalent in Europe—was necessary to save capitalism. Many business leaders today similarly agree that democratization is necessary to make globalization politically acceptable throughout the world.” Essentially, its purpose would be to give globalization “grassroots acceptance and legitimacy.”[63]

David Rothkopf, a scholar at the Carnegie Endowment for International Peace, former Deputy Undersecretary of Commerce for International Trade in the Clinton administration, former managing director of Kissinger and Associates, and a member of the Council on Foreign Relations, recently wrote a book titled, Superclass: The Global Power Elite and the World They are Making. As a member of that “superclass,” his writing should provide a necessary insight into the construction of this “New World Order.” He states that, “In a world of global movements and threats that don’t present their passports at national borders, it is no longer possible for a nation-state acting alone to fulfill its portion of the social contract.” He wrote that, “progress will continue to be made,” however, it will be challenging, because it “undercuts many national and local power structures and cultural concepts that have foundations deep in the bedrock of human civilization, namely the notion of sovereignty.” He further wrote that, “Mechanisms of global governance are more achievable in today’s environment,” and that these mechanisms “are often creative with temporary solutions to urgent problems that cannot wait for the world to embrace a bigger and more controversial idea like real global government.”[64]

Jacques Attali, founder and former President of the European Bank for Reconstruction and Development, and economic adviser to French President Nicholas Sarkozy, interviewed on EuroNews, said that, “either we’re heading towards a world government or we’re going to put national issues first.” The interviewer stated that the idea of world government will frighten many people, to which Attali responded, “Indeed, that’s only to be expected, because it seems like a fantasy. But there is already global authority in many areas,” and that, “even if it’s hard to think of a European government at the moment, which is there, but very weak, Europe can at least press on its experience to the world. If they’re not capable of creating an economic framework along side a political framework, then they’re never going to do it on a global scale. And then the world economic model will break up, and we’ll be back to the Great Depression.”[65]

In December of 2008, the Financial Times published an article titled, “And Now for A World Government,” in which the author, former Bilderberg attendee, Gideon Rachman, wrote that, “for the first time in my life, I think the formation of some sort of world government is plausible,” and that, “A ‘world government’ would involve much more than co-operation between nations. It would be an entity with state-like characteristics, backed by a body of laws. The European Union has already set up a continental government for 27 countries, which could be a model. The EU has a supreme court, a currency, thousands of pages of law, a large civil service and the ability to deploy military force.”

He stated that, “it is increasingly clear that the most difficult issues facing national governments are international in nature: there is global warming, a global financial crisis and a ‘global war on terror’.” He wrote that the European model could “go global” and that a world government “could be done,” as “The financial crisis and climate change are pushing national governments towards global solutions, even in countries such as China and the US that are traditionally fierce guardians of national sovereignty.” He quoted an adviser to French President Nicolas Sarkozy as saying, “Global governance is just a euphemism for global government,” and that the “core of the international financial crisis is that we have global financial markets and no global rule of law.” However, Rachman states that any push towards a global government “will be a painful, slow process.” He then states that a key problem in this push can be explained with an example from the EU, which “has suffered a series of humiliating defeats in referendums, when plans for ‘ever closer union’ have been referred to the voters. In general, the Union has progressed fastest when far-reaching deals have been agreed by technocrats and politicians – and then pushed through without direct reference to the voters. International governance tends to be effective, only when it is anti-democratic. [Emphasis added]”[66]

In November of 2008, the United States National Intelligence Council (NIC), the US intelligence community’s “center for midterm and long-term strategic thinking,” released a report that it produced in collaboration with numerous think tanks, consulting firms, academic institutions and hundreds of other experts, among them are the Atlantic Council of the United States, the Wilson Center, RAND Corporation, the Brookings Institution, American Enterprise Institute, Texas A&M University, the Council on Foreign Relations and Chatham House in London.[67]

Outlining the global trends that the world will be going through up to the year 2025, the report states that the financial crisis “will require long-term efforts to establish a new international system.” It suggests that as the “China-model” for development becomes increasingly attractive, there may be a “decline in democratization” for emerging economies, authoritarian regimes, and “weak democracies frustrated by years of economic underperformance.” Further, the dollar will cease to be the global reserve currency, as there would likely be a “move away from the dollar.”[68]

Further, the dollar will become “something of a first among equals in a basket of currencies by 2025. This could occur suddenly in the wake of a crisis, or gradually with global rebalancing.”[69] The report elaborates on the construction of a new international system, stating that, “By 2025, nation-states will no longer be the only – and often not the most important – actors on the world stage and the ‘international system’ will have morphed to accommodate the new reality. But the transformation will be incomplete and uneven.” Further, it would be “unlikely to see an overarching, comprehensive, unitary approach to global governance. Current trends suggest that global governance in 2025 will be a patchwork of overlapping, often ad hoc and fragmented efforts, with shifting coalitions of member nations, international organizations, social movements, NGOs, philanthropic foundations, and companies.” It also notes that, “Most of the pressing transnational problems – including climate change, regulation of globalized financial markets, migration, failing states, crime networks, etc. – are unlikely to be effectively resolved by the actions of individual nation-states. The need for effective global governance will increase faster than existing mechanisms can respond.”[70]

The report discusses regionalism, and stated that, “Asian regionalism would have global implications, possibly sparking or reinforcing a trend toward three trade and financial clusters that could become quasi-blocs (North America, Europe, and East Asia).” These blocs “would have implications for the ability to achieve future global World Trade Organization agreements and regional clusters could compete in the setting of trans-regional product standards for IT, biotech, nanotech, intellectual property rights, and other ‘new economy’ products.”[71]

In discussing democracy and democratization, the report stated that, “advances are likely to slow and globalization will subject many recently democratized countries to increasing social and economic pressures that could undermine liberal institutions.” This is largely because “the better economic performance of many authoritarian governments could sow doubts among some about democracy as the best form of government.  The surveys we consulted indicated that many East Asians put greater emphasis on good management, including increasing standards of livings, than democracy.” Further, “even in many well-established democracies, surveys show growing frustration with the current workings of democratic government and questioning among elites over the ability of democratic governments to take the bold actions necessary to deal rapidly and effectively with the growing number of transnational challenges.”[72] In other words, “well established democracies,” such as those in Western Europe and North America, will, through successive crises (climate, finance, war), erode and replace their democratic systems of government with totalitarian structures that are able to “take the bold actions necessary” to deal with “transnational challenges.”

David Rockefeller wrote in his book, Memoirs, that, “For more than a century ideological extremists at either end of the political spectrum have seized upon well-publicized incidents such as my encounter with Castro to attack the Rockefeller family for the inordinate influence they claim we wield over American political and economic institutions. Some even believe we are part of a secret cabal working against the best interests of the United States, characterizing my family and me as ‘internationalists’ and of conspiring with others around the world to build a more integrated global political and economic structure–one world, if you will. If that’s the charge, I stand guilty, and I am proud of it.” (Empahsis added) [73]

The Global Economic Crisis in Context

The current global economic crisis has its roots not in the Bush administration, which is linear and diluted thinking at best, but in the systematic nature of the global capitalist system. Crisis is not separate from capital; crisis is capitalist expansion. In addressing the foundations of the economic crisis, neo-Marxist theory can help explain much of the actions and functions that led to the crisis.

In 2006, Walden Bello wrote an article for Third World Quarterly, in which he explained that, “The crisis of globalisation and over-accumulation is one of the three central crises that are currently eroding US hegemony. The other two are the over-extension of US military power and the crisis of legitimacy of liberal democracy.” He explained that, “Monetary manipulation, via the high interest rate regime initiated by Federal Reserve Chief Paul Volcker in the late 1980s, while directed at fighting inflation, was also geared strategically at channeling global savings to the USA to fuel economic expansion. One key consequence of this momentous move was the Third World debt crisis of the early 1980s, which ended the boom of the economies of the South and led to their resubordination to the Northern capitalist centres.”[74]

The economic foundations of the current crisis were laid in the “Clinton globalist project.” As Bello explained, “The administration embraced globalisation as its ‘Grand Strategy’—that is, its fundamental foreign policy posture towards the world.” Further, “The dominant position of the USA allowed the liberal faction of the US capitalist class to act as a leading edge of a transnational ruling elite in the process of formation—a transnational elite alliance that could act to promote the comprehensive interest of the international capitalist class.”[75]

Bello then explained that, “the dominant dynamic of global capitalism during the Clinton period—one that was the source of its strength as well as its Achilles’ Heel—was not the movement of productive capital but the gyrations of finance capital.” The dominance of finance capital was “a result of the declining profitability of industry brought about by the crisis of overproduction. By 1997 profits in US industry had stopped growing. Financial speculation, or what one might conceptualise as the squeezing of value from already created value, became the most dynamic source of profitability.” This was termed “financialization,” and it had many components that composed its structure and led way for its dominance. Among these were the “Elimination of restrictions dating back to the 1930s that had created a Chinese Wall between investment banking and commercial banking in the USA opened up a new era of rapid consolidation in the US financial sector.”[76]

Specifically, this is in reference to the repealing of the Glass-Steagall Act, put in place in 1933 in response to the actions that created the Great Depression, which undertook banking reforms, specifically those designed to limit speculation. In 1987, the Federal Reserve Board voted to ease regulations under Glass-Steagall, after hearing “proposals from Citicorp, J.P. Morgan and Bankers Trust advocating the loosening of Glass-Steagall restrictions to allow banks to handle several underwriting businesses, including commercial paper, municipal revenue bonds, and mortgage-backed securities.” And, “In August 1987, Alan Greenspan — formerly a director of J.P. Morgan and a proponent of banking deregulation – [became] chairman of the Federal Reserve Board.” In 1989, “the Fed Board approve[d] an application by J.P. Morgan, Chase Manhattan, Bankers Trust, and Citicorp to expand the Glass-Steagall loophole to include dealing in debt and equity securities in addition to municipal securities and commercial paper.” In 1990, “J.P. Morgan [became] the first bank to receive permission from the Federal Reserve to underwrite securities.”

In 1998, the House of Representatives passed “legislation by a vote of 214 to 213 that allow[ed] for the merging of banks, securities firms, and insurance companies into huge financial conglomerates.” And in 1999, “After 12 attempts in 25 years, Congress finally repeal[ed] Glass-Steagall, rewarding financial companies for more than 20 years and $300 million worth of lobbying efforts.”[77]

It was in “the late 1990s, with the stock market surging to unimaginable heights, large banks merging with and swallowing up smaller banks, and a huge increase in banks having transnational branches, Wall Street and its many friends in congress wanted to eliminate the regulations that had been intended to protect investors and stabilize the financial system. Hence the Gramm-Leach-Bliley Act of 1999 repealed key parts of Glass-Steagall and the Bank Holding Act and allowed commercial and investment banks to merge, to offer home mortgage loans, sell securities and stocks, and offer insurance.”[78]

One of the architects of the repeal of Glass-Steagall was Clinton Treasury Secretary Robert Rubin. Rubin spent 26 years with Goldman Sachs before entering the Treasury. Robert Rubin worked closely with Alan Greenspan to oppose the regulation of derivatives, and was backed up by his Deputy Treasury Secretary, Lawrence Summers. Rubin, upon leaving the Treasury, went to work as an executive with Citigroup.[79] Robert Rubin is currently the Co-Chairman of the Council on Foreign Relations. Lawrence Summers was a former Chief Economist for the World Bank before being Deputy Treasury Secretary in the Clinton administration. He then became President of Harvard University, and is now Director of the White House National Economic Council in the Obama administration. The current Treasury Secretary, Timothy Geithner, was former President of the Federal Reserve Bank of New York, and is also a Robert Rubin protégé.

The Clinton years saw the rise of derivatives, which are financial instruments (or contracts), the prices of which are derived from one or more underlying assets, indexes, or other items. The value of a derivative changes as the value of the underlying asset changes. They are used to hedge risks but also as instruments of speculation. Derivatives, “which monetised and traded risk in the exchange of a whole range of commodities,” are a key factor that led to the economic crisis.

Another cause of the crisis was “The creation of massive consumer credit to fuel consumption, with much of the source of this capital coming from foreign investors,” which “created a dangerous gap between the consumers’ debt and their income, opening up the possibility of consumer collapse or default that would carry away both consumers and their creditors.” Further, the stock market’s role in driving growth played a part in paving the way for a financial crisis. “Stock market activity drove, in particular, the so-called technology sector, creating a condition of ‘virtual capitalism’ whose dynamics were based on the expectation of future profitability rather than on current performance, which was the iron rule in the ‘real economy’.”[80]

The Federal Reserve, under Alan Greenspan, initially created the dot-com bubble, providing liquidity for speculation into the stock market and “virtual capitalism,”[81] and when that dot-com bubble burst, as all bubbles do, Greenspan and the Fed created the housing bubble by cutting interests rates and offering more Adjustable Rate Mortgages (AMRs), with Fannie Mae and Freddie Mac encouraging banks to make the high-risk loans.[82]

Speculation had proven itself to be a powerful weapon of finance capital. In the 1990s, this was first exemplified by “a speculative attack on the peso that had investors in panic cashing their pesos for dollars, leading to the devaluation and collapse of the Mexican economy in 1994,” and later in “East Asia in 1997. One hundred billion dollars in speculative capital flooded into the region between 1994 and 1997 as countries liberalised their capital accounts.” This speculative money flowed into real estate and the stock market, which resulted in over-investment, and “Smelling crisis in the air, hedge funds and other speculators targeted the Thai baht, Korean won and other currencies, triggering a massive financial panic that led to the drastic devaluation of these currencies and laid low Asia’s tiger economies. In a few short weeks in the summer of 1997 some $100 billion rushed out of the Asian economies, leading to a drastic reversal of the sizzling growth that had marked those economies in the preceding decade. In less than a month, some 21 million Indonesians and one million Thais found themselves thrust under the poverty line.”[83] This was known as the East Asian Financial Crisis.

This crisis “helped precipitate the Russian financial crisis in 1998, as well as financial troubles in Brazil and Argentina that contributed to the spectacular unraveling of Argentina’s economy in 2001 and 2002, when the economy that had distinguished itself as the most faithful follower of the IMF’s prescriptions of trade and financial liberalisation found itself forced to declare a default on $100 billion of its $140 billion external debt.”[84]

The current crisis is not over. The parallels between the current crisis and the Great Depression are frightening. This trend of building speculative bubbles is reminiscent of the 1920s stock market speculation-driven bubble; built by the Federal Reserve, which eased interest rates, provided liquidity to the banks and actively encouraged speculation. Bubbles that were created then burst.

In 1932, Congressman Louis T. McFadden stated before the Congress that the Federal Reserve banks are not government agencies, but “are private credit monopolies which prey upon the people of the United States for the benefit of themselves and their foreign customers; foreign and domestic speculators and swindlers; and rich and predatory money lenders.”[85] Following the creation of the Fed in 1913, Congressman Charles A. Lindbergh said, “From now on, depressions will be scientifically created.” Indeed, he was right. The current crisis, likely leading to a Great Depression, is being used as the primary means through which a global government is being constructed.

In 2007, UK Prime Minister Gordon Brown called for a new world order in reforming the UN, World Bank, IMF and G7.[86] When the bank Bear Stearns collapsed, due to its heavy participation in the mortgage securities market, the Federal Reserve purchased the bank for JP Morgan Chase, whose CEO sits on the board of the New York Federal Reserve Bank. Shortly after this action, a major financial firm released a report saying that banks face a “new world order” of “consolidation and acquisitions.”[87]

In October of 2008, Gordon Brown said that we “must have a new Bretton Woods – building a new international financial architecture for the years ahead.” He continued in saying that, “we must now reform the international financial system around the agreed principles of transparency, integrity, responsibility, good housekeeping and co-operation across borders.” An article in the Telegraph reported that Gordon Brown would want “to see the IMF reformed to become a ‘global central bank’ closely monitoring the international economy and financial system.”[88] In an op-ed for the Washington Post, Gordon Brown wrote that the “new Bretton Woods” should build upon the concept of  “global governance.”[89] There were also calls for a “global economic policeman,” perhaps in the form of the Bank for International Settlements (BIS).[90] In November of 2008, it was reported that Baron David de Rothschild “shares most people’s view that there is a new world order. In his opinion, banks will deleverage and there will be a new form of global governance.”[91]

Out of the ashes of the financial crisis, a new world order will emerge in constructing a global government.

Notes

[1]        Membership, Peter Sutherland. The Trilateral Commission: October 2007: http://www.trilateral.org/membship/bios/ps.htm

[2]        Daily Mail, EU Constitution – the main points. The Daily Mail: June 19, 2004: http://www.dailymail.co.uk/news/article-307249/EU-Constitution–main-points.html

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