The Scorpion and The Frog

When you look at the sales pitch for Capitalism and how it’s supposed to function, it feels to me as though it were crafted in order to conjure up fictitious images that reflect the undisclosed desires of an individual.   They want it to sound empowering and even morally righteous.  They will tell you with hard work, you’re going to be rich!  I’m sure, for the most part, that everyone is familiar by now with how the sales pitch goes.   It’s usually something about the free market.   A little about how anyone can be rich if they come out with a really great product.   Something along those lines.  Typically it doesn’t pan out like this.  Hell even the pointless right-leaning version of Wikipedia acknowledges that, and they have a near 50-page long article about how homosexuality is the root of all sorts of social diseases.  Consider this:

“One self-regulating feature of capitalism is competition, which helps maintain fair market value for goods and services. However, unrestrained or pure capitalism may sometimes create a positive feedback loop in which a small number of individual accumulations of capital grow ever larger, eventually becoming so few as to limit effective competition, thus ceasing to strictly be free-market capitalism. In this regard, pure capitalism is unstable.”

It’s not really unstable.  It’s how the system was designed to work.   You start a business, it gets big, you become a corporation in order to function at higher and higher levels economically, with one real goal in mind.   The only goal of a corporation is to increase profits for it’s shareholders.   That’s absolutely it.  That’s essentially the nature of the beast, and it shouldn’t be really surprising when corporations begin interfering in politics.   When you have the money, you can influence the power, and with the money and the power you can begin to stack the deck against anyone else coming to take your piece of the market.   You can begin to eliminate competition, and you can ensure that only the people who play by your rules ever get to experience what it’s like to be one of them.   Wealthy.  Keep in mind that when I refer to wealth, I’m not talking about a couple of million.   I’m referring to the type of money that grants you political power.   That’s not something that’s obtainable, except on a small scale, to anyone but a corporate entity.

When a corporation’s activities negatively or positively impact a society they actually have crafted a term for this so that when they speak of it, anyone but those familiar with the term, will be unaware as to what they are referring to.   This is an important function of what I have started to dub ‘corp speak.’  The purpose of corp speak, is to obfuscate the meaning of what they are saying so that the layperson will not be able to actually comprehend whatever point they are making.   The particular term, in this case, is an ‘externality.’  Wikipedia defines an externality like this.

In economics, an externality or spillover of an economic transaction is an impact on a party that is not directly involved in the transaction. In such a case, prices do not reflect the full costs or benefits in production or consumption of a product or service. An advantageous impact is called an external benefit or positive externality, while a detrimental impact is called an external cost or negative externality. Producers and consumers in a market may either not bear all of the costs or not reap all of the benefits of the economic activity. For example, manufacturing that causes air pollution imposes costs on the whole society, while fire-proofing a home improves the fire safety of neighbors. In a competitive market, the existence of externalities would cause either too much or too little of the good to be produced or consumed in terms of overall costs and benefits to society.

If there exist external costs such as pollution, the good will be overproduced by a competitive market, as the producer does not take into account the external costs when producing the good. If there are external benefits, such as in areas of education or public safety, too little of the good would be produced by private markets as producers and buyers do not take into account the external benefits to others. Here, overall cost and benefit to society is defined as the sum of the economic benefits and costs for all parties involved.

I also found a video which describes this term, that may be prudent to share:

So, when a businesses decisions affect society, it’s an ‘externality.’   When the housing crisis hit, it made me wonder in a board meeting of the top bankers someone actually said something along the lines of… “Our market paradigms seem to have shifted the bulk of the negative externalities of toxic assets onto the consumer market.”   Language designed to speak even of things like kicking people out of their homes they were strong armed into getting loans for in the first place, (Funfact:  The FBI has determined over 80% of these loans that went bad were the result of dubious lending practices and not consumer error) as though it were merely a normal business transaction.  It’s language meant to convey ideas without actually addressing or spelling out what those ideas represent.   You may as well just speak in numerical code.

As a small disclaimer, allow me to make the point that I don’t think that every Corporation is horribly amoral.   There are plenty of places that respect their workers, pay them well, and do things to help the community.   Like Google.   However, the vast majority of mega-corporations, which means the bankers, defense contractors, oil companies, and any others that have political power through lobbying and campaign contributions are the ones that I’m specifically referring to.

It’s more or less obvious what’s going to eventually happen when you deregulate the market and trust a group of people who’s only really goal is to increase profits to buy their way into being able to influence public policy.  They are going to try to stack the deck in their favor.  They are going to do whatever it takes to increase profits, even if it’s only to make as much money as possible before things go sour.   That’s just what these people are supposed to do, because, thanks to what I feel is a somewhat backwards system of values, people in this country tend to celebrate anyone who makes a lot of money in this country as though they are just super great.  Regardless of what exactly they did to get it.  As a result money ceases to become a means to and end, but rather the end to the means.  The driving force behind the country then ceases to be any sort of public function, goal, or plan.  It just becomes this insane chase for wealth that leaves sprawling ghettos and foreclosed houses in it’s wake like some sort of beast that feeds on rotting wood and the misery of others.

Now, these things are at least obvious to me.  Just looking at the nature of the system from the outside.   Being rich is great, I won’t deny it.   It’s like some kind of fitful dream, beautiful and yet still a dream.   So there’s always a fear you’re going to wake up one day from it and find yourself having to face some unpleasant realities.   As a child, my family was pretty rich.   We lived in a nice house, a really nice house.   Suburban neighborhood.   This was in the beginning of the 80s when there was such a thing as the upper-middle class.  My father worked as a sales person for a roofing company, a construction salesman basically.   I remember how much money we had, it was great in terms of always having toys and always having the latest greatest technology in the house.   I can recall playing with a computer before any other kid I knew had one.  It came with this program you would make pixelated butterflies with and it took something like 3-4 of those giant five inch floppy disks they used to make to run the program.   You’d edit your butterflies with one, put in another to watch them fly, put in the third if you wanted them to fly around a very-poorly rendered field.    It brought it’s comforts, money did, but also it’s troubles.   The more cash you have the more you have to worry about how easy it is to have it taken away.   One badly timed layoff, for example, and you were done.   This seemed to put a lot of pressure on my father, because he certainly redirected a lot of that pressure back to me and the rest of the family.   If you catch my drift.

As a kid, mostly due to being raised without having to worry about money, I never grew up caring that much for it either way.   I have always viewed it as a tool, you know, a means to get things I either need or want.   I’ve never viewed it as something that should be valued above everything else.  This was even after my father did, eventually, lose his job.  The details elude me on how that happened exactly, but we went from our suburb to being broke very fast.   Dad filed for bankruptcy, then ran off.   Mom and us made a great exodus to Orlando to live near my grandfather because he had his army pension and could help us out.   The point of this tale lies here.   My grandfather was obsessed with pyramid scams.   He couldn’t stop.

A pitch for a pyramid scam goes pretty much like the pitch for capitalism.  Be your own boss!  Work hard and you’ll be rich!  Start your own business!  Financial independence!  Of course, six months later and after buying about 20,000 name stickers and spending hours sticking them to letters that said those same slogans, you are no closer to that goal than you were when you first started.  Just five dollars a month and you can be part of your own business!  What they often fail to mention is the actual logistics of this magical business you’re getting into.   Generally the product for  a pyramid scam is ‘people.’   What that means is that you get people beneath you to pay into the company, and you help them get people under them, who in turn get people under them, etc etc etc.   This works out only, in most cases, for the people really high up in the pyramid, and not so much for you.   So after you’ve spent about 5oo bucks on letters, stickers, not to mention the amount of time you have to spend sending this crap out, talking to people, and trying to convince them to join something that you have to get about 1,000 people under you in order to make any decent cash on it… you tend to discover that those at the bottom tend to be lazy, give up, and then you’re stuck with a family of five Indians who are your only people and getting a check for 3 bucks a month which doesn’t offset your costs at all.  My grandfather tried dozens of these scams, all with names like ‘The 7 Club’ or ‘Golden Futures.’  With rare to minimal success, and in the long run, they ended up costing him more money to simply participate in than they ever made for him.

I guess that’s why when I was becoming aware of politics I’ve always found capitalism to be such a huge joke, it seems based entirely on the Wall Street pyramid scam, exploitation and hypocrisy.   I just think back to all those sales pitches for the pyramid scams and see virtually no difference, in terms of how the system operates… with a few on top getting the lions share based on the hard work and toil of a few saps thinking they’ll be rich.  Remember the nature of the beast, to increase profits, that’s it.  People seem to act shocked when faced by what companies tend to do to reach that goal.   Perhaps it’d be a different store if they also had an obligation to their stakeholders as well, the workers and communities their activities affect.   Clearly this is not that case, even the language used to describe the parameters from which they operate says that they must place the financial interests of their owners (the shareholders and executives) above that of any other interest.   Essentially they are required, by law, to not care about anyone but themselves.   This makes is strange that they are considered a legal ‘person.’   When corporations first came about they were chartered by the citizens and the state to perform a specific singular function, and were not allowed to operate indefinitely.   After the civil war, with the addition of the law that all citizens are created equally, corporate lawyers came before the court, not freed slaves mind you, who the law was intended for, and argued that they are in fact ‘persons’ and deserve the rights of a ‘person.’   This is an important distinction because that means that the corporation can have all the rights of a singular person, while hiding all the people who may be involved should their activities be actually considered illegal, under a blanket of anonymity.   You can’t arrest a person that isn’t a person, you can sue it, you can shut it down, but the people operating behind the sock-puppet of the corporation can get off scot-free.   Guilt free, even, because they were only doing what the corporation is legally obligated to do.  It’s given an additional layer of sick irony by the fact that a law that was designed to free black slaves, ended up being used to enslave a future workforce.

A psychiatrist on what a type of person a corporation would be, if the legal terminology applied to reality…

Clearly, this is irrelevant, because a corporation is obviously not a person; however, it does paint a certain picture.  Besides, if they want to be considered persons, then why not have a little fun with it?

When the media decides to actually pay attention and come down on them, all the moronic talking heads act all shocked and insulted at their actions,  like when Enron collapsed, it shows just how clueless they are about what our society has permitted to happen and perpetuate.   Make no mistake, corporations are the direct result of people simply not paying attention to what it is they are being told to them by someone in a nice suit and a smile.   The reaction of the media to this greed, whenever it manifests, only shows just how clueless they are as to what is going on, and just how little investigating they actually do.   It comes off like a bad play, an act to keep us distracted from just how pervasive and all-encompassing these monolithic entities really are.   It’s not just a few ‘bad apples,’  it’s a whole farmload of them.  The ‘good apples’ are the exception, because they are going against the mandates that the law has set for them.

As a result, I’ve always been deeply interested and aware of corporate excess, and especially how dangerous allowing these groups to have the amount of influence that they enjoy.  It’s almost a morbid fascination with what these people actually think of us, and how they are so brazen about it.   It’s even more amazing to me how most people don’t care at the least and actually defend a system that for the most part views them as a ‘peasant.’   So when I went last week to see Mike Moore’s latest propaganda, I went expecting to have a bunch of platitudes that miss the point and nonsense that has nothing to do with the subject matter thrown into the mix.   Let me say one thing about the bastard though, as much as I’d like to disagree with him, merely because of the grandstanding and the usage of human suffering by him in some cases to make his point seem to have more gravity… such as when in Fahrenheit 9/11 when he had the crying mother of a dead solider running around confronting protesters, which I felt was in bad taste, he can sometimes reveal a nice big nugget of truth intermixed with some of the BS.  I really dislike him, because while I don’t like his methods, for the most part, I tend to agree with his views in this particular film.

His view, and this should be no shock to any of you, is that Capitalism is basically a broken system that only benefits the rich.    Yeah, I know, I just blew your mind with that one.   The movie basically did nothing to change my view on the subject, as I’ve always felt that sentiment is practically a truism and at some points attempted to argue how Capitalism is grotesquely flawed, especially with how susceptible the markets are to severe ups and downs which can affect the small people much more harshly.   In the movie he constantly refers to Wall Street as a casino, which is a metaphor that doesn’t quite reflect reality.   It is a casino, but instead when the person placing the bet loses they don’t take his money.  They give him a billion plus dollar golden parachute, and then fire all his employees.   Basically it’s a casino where the more they bet, the more we lose.  I digress from this though, for the moment.

The movie did; however, point out two particular offenses of which I was not previously aware of.   One is something called ‘Dead Peasant’ insurance.   For those of you that are unaware of what that is, you’re gonna love this.  Basically  ‘Dead Peasant’ insurance is when your workplace will take out a life insurance policy on you, sometimes with dubious consent, sometimes with none at all.   They do this, to in the words of one representative of Bank of America, ‘to offset the costs of employee benefits’  also adding that ‘it’s a legitimate business practice.’   If by ‘legitimate’ they mean horrifically amoral, morbid, and insulting… then I suppose I’d agree.  I’ve heard of some messed up stuff businesses have done to people, like when Pacific Power and Light was pumping radioactive waste into a town’s water supply infecting the majority of the town with cancer; but I’ve never heard of your bosses betting on if you’re likely to die and taking out thousands, and in some cases millions of dollars worth of insurance policies on you, crossing their fingers, and hoping you have a happy ‘accident.’   Especially with the fact that healthcare is so expensive, that just makes it lean into borderline conspiracy territory.   Think about how screwed up this is, you don’t even have to be an employee anymore and they’ll still cash that check when you keel over.    Also bear in mind that many companies require a pre-employment physical and have access to your health records through company health insurance, etc.  So these are not just roll of the dice bets on which employees might die. The companies have inside information that they can use to maximize returns on life insurance policies.  Until recently it was even tax-free!

Yeah, that portion made me raise an eyebrow, but you know how it is when someone’s trying to make a point, especially when you know that what you’re about to watch is pretty much biased.   In this case though, I would say it wasn’t nearly as biased as his other movie, Fahrenheit 9/11.   In this movie he paints a pretty ugly picture of the democrats and how they seemed to handle the bailouts.   Still, bearing the bias in mind I did my own sort of investigating on the subject, and yeah, it’s pretty common.   So, back to ‘dead peasants,’ in some cases I think that language and wording can reveal a lot about people’s intentions or an organizations for that matter.   To call dead employees that they are profiting from, and in many cases earning back four or five times the maximum amount of money they paid said employee while they were alive, ‘peasants’ really shows us what the really big corporations think about us.   It’s not just small potatoes businesses that do/did this either, there are some big names on the list.   To name a few…

* Amegy Bank, N.A.
* American Express Co.
* American Greetings Corp.
* American Management Systems Inc.
* American Seafoods Group LLC
* Ameritech Corp.
* AT&T Communications
* Avon Products Inc.
* B. F. Goodrich Company
* Bank Of America
* Bellsouth Corporation
* Citibank, N.A.
* Citizens Bank
* Clorox Company
* Coca-Cola Company
* Cox Enterprises, Inc.
* Diebold Inc.
* Dow Chemical
* Eastman Kodak Company
* Frontier Bank
* GNC Corp.
* GTE Corporation
* Hershey Foods Corporation
* JP Morgan Chase & Co.
* Marriott International Inc.
* NationsBank
* Nestle Enterprises
* Service Merchandise Co., Inc.
* Sherwin-Williams
* Southwest Bank
* TYCO International
* UniFirst Corp.
* Union Bank
* Wachovia Corporation
* Walgreen Company
* Wal-Mart Stores
* Walt Disney
* Wells Fargo, N.A.
* Winn Dixie
* Woolworth Corporation

There’s more, of course, but those were the ones that stuck out.   To be fair, some of them no longer do this, mostly due to lawsuits from angry relatives, but there’s a lot more that not only keep doing it… but feel it’s perfectly alright to make money off dead employees.   Something about that leaves a rather sour taste in my mouth, must be the bullshit.

The other thing that was mentioned that I immediately had to track down when I got home was this study that Citigroup released to it’s top shareholders.  Since most people, I’ve seen from looking for this thing, who happen to be of a right-leaning persuasion, think that this document doesn’t actually exist, I’ve uploaded a copy I obtained, get it here:

Part 1 Part 2

Well, lets first explore the definition of a plutocracy which, from what I’ve managed to gather is pretty much the same thing as a ‘plutonomy.’

1. the rule or power of wealth or of the wealthy.

2. a government or state in which the wealthy class rules.

3. a class or group ruling, or exercising power or influence, by virtue of its wealth.

I’m going to assume, that what they are thinking is that were are on somewhere between definitions two and three.

If this information actually manages to shock you, then you clearly haven’t been paying much attention to what has been going on with the rise of corporatism.   Since the industrial revolution the bulk of these entities have shown zero loyalty to anyone and anything but the bottom line and people who support them.  In the US the top 1% own over 50% of the stock and over 16 trillion dollars in assets.   The rest of us, well… it just keeps going further and further down.   So when one of the biggest banking institutions that was at the absolute epicenter of the housing ‘crisis’ issues a report that states that the country has become disproportionately skewed to accommodate the rich, and that explains everything from rising gas prices to incremental rate hikes for every service and product imaginable, in the model of the plutonomy… the average consumer and the strain these hikes impose on them do not matter.

I think that’s a sobering thought for a lot of people who just love every capitalist to death and seem to assume that businesses are providing something for us.   They’ve stagnated progress, increased the gap between poor and rich, and have apparently been hiring very smart and educated people to find out how to keep it going because they feel it’s a good thing.   If all they have to do is cater to the top 1% and disregard the rest of us, then my god, think of all the money they will save on advertising dollars, on buying out reporters, keeping news propaganda going.   They can effectively ignore the average consumer because the average consumer is clearly going to keep buying gas and food and all those things because they cannot afford not to.   We don’t matter.  They don’t care.   They have never cared.   They won’t stop.   These are things that people who speak out against this sort of thing need to realize.  Especially liberals.  They don’t care about peace or emotionality or any of that crap.   They only care about profit, power, and control.   Corporations are not swayed by speeches or what animals die or what happens to the environment unless you make them care.  It will have to be liberals that realize this, because it seems to me that the conservatives are somehow drunk on partisanship and appear to be living in a delusional alternate reality where businesses and capitalists can do no wrong.   Therefore to rely on their support or help is unlikely in regards to this issue.  There is also this pretense that it is good and moral to seek wealth as a form of personal liberation, a strange thought to have amidst a party that prides itself on being based more on religion.   Often using god’s will as a form of justification for it’s actions.   The reason it’s strange to me is that I have studied the bible and used to be a Christian myself, and Jesus did not teach anyone to seek wealth and horde it.   Rather he stated that the rich man will have a hard time getting into the kingdom of Heaven.   He preached ’spreading the wealth.’   Jesus, God’s son and more of a socialist than he ever was a capitalist.   To me this says that the conservatives are either using god only as a means to acquire votes, or that they only selectively believe what’s convenient for them.

Capitalism also encourages a strange disconnect from what people want to do and what they will do to turn a profit, this becomes apparent when you listen to some interviews with CEOs or Executives.   They have this pressure, and it’s a huge pressure, to do only what the shareholders demand, which is increase profits.   So they are essentially forced to follow through with things that they wouldn’t normally do, such as layoff massive amounts of employees, because the shareholders want that.  Since the wealthy control 50% of the stocks, it’s not like that sort of thing is going to affect them, so why would they care?   Either way it paints a rather bleak picture for the rest of us.  Hell, for the world in general.   Still there’s something that can be done, they even outline it in their little document…

Our whole plutonomy thesis is based on the idea that the rich will keep getting richer. This thesis is not without its risks. For example, a policy error leading to asset deflation, would likely damage plutonomy. Furthermore, the rising wealth gap between the rich and poor will probably at some point lead to a political backlash. Whilst the rich are getting a greater share of the wealth, and the poor a lesser share, political enfrachisement remains as was – one person, one vote (in the plutonomies). At some point it is likely that labor will fight back against the rising profit share of the rich and there will be a political backlash against the rising wealth of the rich. This could be felt through higher taxation (on the rich or indirectly though higher corporate taxes/regulation) or through trying to protect indigenous laborers, in a push-back on globalization – either anti-immigration, or protectionism. We don’t see this happening yet, though there are signs of rising political tensions. However we are keeping a close eye on developments.

Think about the implications of that.   All those things, which sound like positives, are contrary to the very desires of those whom Americans have piled so much faith and admiration upon.   Looking at how there are people that still defend the actions of businesses that have essentially financially crippled them and plan on making it worse, and view that as a good thing, makes me wonder if this nation is suffering from the financial equivalent of Stockholm Syndrome, or if the hope of being rich one day is all they have to cling to in light of the fact that it’s becoming increasingly less likely that’s going to happen.

It’s like the scorpion and the frog, and we’re the frog.   Still attempting to swim after being stung repeatedly, and the scorpion just keeps laughing as we struggle on across the waters of life.  If enough people had the sense to submerge, perhaps things would be different, but that would require people to face the reality of the situation, and for most people that remains an impossible feat.

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