Wednesday, September 05, 2012

Plutocratic Insurgency

I recently engaged in a private exchange with leading 4GW thinker Robert Bunker on the question of how to periodize what he calls "plutocratic insurgency." Here are a few notes I took in the course of that exchange. The point of departure for this sort of an inquiry is to ask what the JohnGaltification of society would actually look like in practice—what would it seriously mean for the wealthy to opt out of participation in the collective institutions that make up society?

This is not an abstract exercise. One of the most important global trends of the last few decades has been the tendency of wealthy elites to hole themselves up in walled off enclaves. These islands of elitism are designed to be largely self-sufficient in their ability to deliver health care, food, security, education, entertainment, etc. to their residents, even as they sit amid seas of social misery. (Mike Davis has spent a good portion of his career chronicling this sort of thing, starting in Los Angeles with City of Quartzand examining it as a global phenomenon in collections like Dead Cities and Evil Paradises.)  From the point of view of the denizens of such communities, the primary function of the wider society is to serve as a source of cheap, servile labor, and as a well of resources to be looted. Gated communities, in turn, are merely an example of a broader pattern, in which economic, social, or political enclaves are carved out of a national state and enabled to play by a fundamentally different set of rules from the surrounding territory.

In themselves the creation of such enclaves do not amount to a plutocratic insurgency. Rather, plutocratic insurgency arises wherever you see financial and economic elites using such enclaves as staging areas for making war on public goods. This is what I take to be the defining political-economic feature of plutocratic insurgency: the attempt on the part of the rich to defund the provisioning of public goods, in order to defang a state which they see as a threat to their prerogatives. (Conceptually, plutocratic insurgencies thus need to be separated from kleptocracies—the latter involve the using the institutions of state to loot the population, whereas the former wish to neutralize those institutions in order to facilitate private sector looting. In practice these may overlap or co-mingle.)

Before discussing the periodization of this phenomenon, it's worth noting that the idea of plutocratic insurgency on its face is paradoxical, perhaps even oxymoronic: shouldn't plutocrats be the folks most invested in the perpetuation of a system which has them at the top? Why would the system's biggest beneficiaries want to make war on the system? The answer lies in part in the rise of an ideology—or perhaps more accurately, a narrative—that has allowed society's winners to imagine their success not as being the result of either the luck or the skill to work the system for their maximum personal benefit, but on the contrary as having been arrived at by pure dint of their own rebellion against the system. So when did this weird phenomenon begin to take hold?

While the ideological origins of the plutocratic insurgency can be traced to the foundation of the Mont Pelerin Society, it really starts to gain cultural visibility with the corporate raiders of the 1980s, guys who thought of themselves not as the leading lights of the empire, but rather as "barbarians at the gates" (a term Henry Kravis had no problem embracing at the time). These guys didn't see themselves as the system's ultimate winners, but rather as iconoclasts who were being rightfully rewarded for destroying entrenched, unproductive rent-seekers. What began to surface in the 1980s has only gained momentum with the growing financialization of the US economy.

On the one hand, then, an ideology of rebellion and success through the undermining of "the takers." The flip side is a material point: the very wealthy today are so rich that they can effectively afford to buy for themselves the sorts of goods which previously required a state to provide. The result is a phenomenon whereby many plutocrats today see no reason to contribute anything to their host societies, and indeed actively make war on the idea that citizenship imbues them with any economic or social responsibilities. (People as different as Stephen Schwartzman and Sheldon Adelson fit this bill, as do the Koch brothers.) In sum, plutocratic insurgency is another way of characterizing the most ideologically ambitious bleeding edge of what sometimes gets terms "Neoliberalism" or "Thatcherism," or "Reaganism." "There's no such thing as society," Thatcher famously declared, thus issuing the cri de coeur of insurgent plutocrats everywhere.  

Beyond the United States, the critical event for the rise of the global plutocratic insurgency was the ideological collapse of state socialism, which everywhere on earth shifted the Overton Window dramatically to the right. Not only was the threat of left-wing grabs largely neutralized by socialism's implosion, but counterrevolutionaries on the right were emboldened by this collapse to attempt to roll back even the moderate, liberal forms of the welfare state. Arguably the most successful plutocratic insurgency in history was staged by the so-called oligarchs who arose from the ruins of the Soviet collapse. These were (mainly Jewish*) men who had started their business careers in the dark-gray corners of the Soviet "second economy," learning how to profit by sharp and ruthless dealing that took state strictures as opportunities rather than limits. Aided by useful idiots like Jeffrey Sachs, they grabbed the vast majority of the state-owned assets that Yeltin was selling off in a drunken fire sale designed to ensure that Communism could never again return to Russia. Eventually, in the Aughts, the former KGBers led by Vladimir Putin would stage a counter-insurgency and defenestrate most of the first generation oligarchs. What the rise of Putin signalled was the end of the Russia's plutocratic insurgency, and the reassertion of the state's interests as prior to those of the wealthy.

It might seem like the story laid out here is a liberal, perhaps even a Marxist one. While it's true that liberals have long fretted about the "secession" of the rich, increasingly conservatives are also getting alarmed. Ultimately, however, I don't think this is really a liberal or conservative matter. It's a question of national and social coherence as such: do people living together in a contiguous territory feel themselves somehow to be "in the same boat," willing to share responsibilities and risks collectively? Those engaged in the plutocratic insurgency answer that question with a defiant "No!" The plutocratic insurgency from above thus mirrors the deviant globalization insurgency from below, and taken together they embody the contemporary crisis of the nation-state.

* UPDATE:  I should clarify the significance of the dramatic overrepresentation of Jews among the first-generation Russian oligarchs, including Boris Berezovsky, Vladimir Gusinsky, Alexander Smolensky, Mikhail Khodorkovsky, Mikhail Friedman, Vitaly Malkin, and others. First, Jewishness was not incidental to these men becoming oligarchs in the first place. While many late Soviet Communist Party members were enriching themselves with bribes, official anti-semitism made it almost impossible for Jews to get ahead within the formal Communist hierarchy. The most effective (and perhaps only) way for Soviet Jews to get ahead commercially, therefore, was by participating in the organization of the "second" (black market) economy. Unsurprisingly, therefore, ambitious Jews were overrepresented among those involved in the second economy, particularly in and around Moscow. This made them well-positioned to take advantage as the state economy collapsed. The biographies of most of the aforementioned oligarchs conform broadly to this pattern. Second, the Jewishness of the oligarchs also helps explain the course of their eventual removal from the apex of the post-Soviet economy. The fact that these oligarchs were Jewish helps account not only for why their appropriation of former state assets was widely perceived by the (anti-semitic) Russian public and elite establishment as illegitimate, but also for why there was little domestic Russian outcry when Putin threw them out of the country or into jail.


Anonymous said...

So are you going to name some specific, events, trends, and policies that the Evil Right Wing Corporatists (tm) have implemented, or are you just going to launch into some vague polemic with no real analysis of policies or issues?
Can you point out any evidence of this mythological singular "society" that you speak of?

Anyway, this sounds like standard left wing partisan crap to me, I mean you've managed to hit on every big right wing boogeyman (mostly people trying to remove Obama from power) that left wingers can think of.

Of course, it's obvious that you're a welfare state managerialist, but you could at least try to be objective about it.

Why do you believe that the monolithic nation-state is still a viable model of control over people?

Also, regarding your apologism for Jews:

"To learn who rules over you, simply find out who you are not allowed to criticize."

ElBlanco said...

@Anonymous ... Fuck off troll

Your 'comment' is just thinly veiled personal attacks, straw man racism and lame cliches.

As a conservative, albeit not a mainstream one, I see a great deal of truth in the authors post.

Anonymous said...

They're about to begin building private cities in Honduras...

Nils said...

@Anonymous2 -- Latin America has been ground zero of the twin insurgencies for three decades now.

Clay Forsberg said...

What if this "Plutocratic Insurgency" incites a Silent Revolution amongst the masses ... a revolution that focuses not on individualism materialism, but rather an evolution towards the good of the community.

FC said...

You can prove anything as long as you don't use mathematics, don't define your terms, and trust your emotions.

Nils said...

@FC - I think you're implying that math is the only way to "prove" something, to which I would say the following.

First, it's not true that math/numbers is the only way to prove something. Second, numbers are just as manipulable as any other mode of discourse, as I'm sure you know.

Third, I wasn't actually trying to "prove" anything, but rather to provide a synthesis and interpretation of an important historical-political pattern. Just because there's no "data" doesn't mean something isn't happening; many political phenomena are qualitative in their essence. While I don't disagree that it's important to define one's terms. I generally find that blogposts are not the best place for long definitional digressions. Making methodological nasty against qualitative methods doesn't change the realities of the situation.

Finally, and most importantly, there in fact is a ton of statistical evidence to support many of issues I was discussing in this post, even if I didn't cite these statistics directly in what was already a plenty long blogpost. For example: (1) there's lots of quantitative evidence of growing disparities in wealth. (2) There's lots of quantitative evidence of the growth of "gated communities," "special economic zones," and other zones of sovereign exception. (3) There's lots of quantitative evidence that investment in public goods has dropped dramatically in the United States - and lots of qualitative evidence as to who has been in favor of such reductions. (If one wished, one could marshall statistical evidence based on SuperPAC and lobbying spend to adduce who is behind these efforts, although really, why bother, since you just need to listen to what these people say--they're not coy.) (4) There's lots of quantitative evidence that the wealthy are (responding to the declining quality of public goods by) sourcing private equivalents of (formerly) public goods for themselves--check out the growth of private schools, private security, private medical clinics, etc. You may be ignorant of this "evidence," or choosing to ignore it, but that doesn't mean it's not freely available.

bdoran said...

Your ignoring the financialization of the welfare state - the Housing Crisis - and the welfare-zation of the Financial sector that happened in response.

You're also ignoring that democracies throughout time degenerate into using the vote to loot your neighbor. As ours has. The difference here is the looted is the middle class. The truly rich write their own tax code - letters of tax opinion - which is why the US Tax code is 72K pages and growing.

The Plutocrats simply sat down with the Kleptocrats - the government - and made themselves part of it's ongoing Control Fraud.

No one is trying to get farther from the precious public goods, schools, housing than the middle and working classes. After the Rust Belt and the destruction of the cities they quite understand who the target of "spreading the wealth around" is..which is why a plumber who dares question the master must be destroyed, while the Plutocrats merely harassed.

The Revolt of the masses is the Middle Class rebelling at being pushed into the underclass.

Nils said...

@bdoran Those are excellent points. The financialization of the welfare state is part of the wider financialization of the economy, and the welfare-ization of the financial economy is certainly a form of kleptocracy. Not sure I agree that all democracies are fated to degenerate into a looting of the beighbors, but it's certainly a risk that all democracies have to manage.

As for the abandonment of public institutions by the middle class, I'd argue that that is more an effect than a cause of the degeneration of the quality of those institutions - though there was an earlier phase of abandonment which was rooted in straight racism as those public institutions were integrated.

Anonymous said...

It occurred to me today that a version of "plutocratic insurgency" is also occurring at the global level, or at least some American conservatives are trying to get there. Ever-tighter restrictions on immigration coupled with attacks on the U.N. and other intergovernmental organizations are in some ways analogous to the gated communities and assaults on public goods you identify at the national level. I'm not sure where this idea leads, but I thought it was potentially interesting.

Nils said...

@dartthrowingchimp — I think that's right. The key thing to understand about neoconservatism is that it is internationalism for those with an essentially isolationist mentality – and it's no surprise that popular support for neoconservative policies come from the same precise demographics that used to be the core of the isolationist movement. What I mean by that is the following: neoconservatism starts from the premise that "we're an empire now" (e.g. Our economy is tied up with the rest of the world) and therefore not engaging internationally is no longer an option. BUT: just because we have to engage internationally doesn't mean those striped pants boys were right about the way to do it. None of that airy-fairy international institution building crap; none of that limp-wristed multilateral shit; none of that pansy foreign aid nonsense. That's all a slippery slope to One World Government. On the contrary, we're going to engage theworld directly, by showing them who's boss, and if those cheese eating surrender monkeys don't like it, they can kiss or fat white asses. No apologizing for nothing! Just kicking ass! America: fuck yeah!

So yes, there's an assault on international public goods and institutions, just like there's an assault on national public goods and institutions. Basically, there's a denial of the very concept of the public good, at any level. If they reject the concept of the unlicensed good at the national or even the municipal level, then of course they also reject it at the international level.

guthrie said...

INterestingly enough David Brin challenged people months ago to come up with examples of the plebeians using democracy to loot their neighbours.

Nobody could think of any. Or at least nobody who posts at his blog, which I suppose is perhaps a little deficient in historians and economists, but still...

What everyone could come up with were examples of the rich elite of society looting society for their own good. As we have just now.

People who think that democracy enables people to loot their neighbours have a concept of society that is so poor and embittered that it is at the very least medieval.
In late medieval europe they accepted that there were different social levels, but each had their obligations, and the rich ones were expected to give food and clothing to the poor at various special occaisions and even the leftovers from their feasts. Now, the plutocrats deny even that, and claiming that democracy leads to people taking money from others is foolish to say the least.

Anonymous said...

"name some specific, events, trends, and policies"

Just to fling more liberal monkeyshit at Anonymous, I might point point out that the Radical Right, Neocons and Corporatists have been pushing a relentless policy of reducing their taxation, to the lowest point in decades, further weakening the Federal, State and local governments through fiscal crisis. For Corporations, the massive investments they make in gifts, political contributions and lobbying are more than rewarded by the savings on corporate taxation they enjoy, gifts of the Congress they effectively OWN, depriving the 99% of citizenry of representation, especially the 47% of non-productive "Takers".

Of course the chosen figurehead they've picked is Mitt Romney, the most unapologetic Corporatist in the Pack of Republican Hopefuls, with Paul Ryan nicely installed as the Representative of Ayn Rand.

Witness also the relentless defunding of Public Education and the insanely spiraling costs of Higher Education, either cutting off middle and working class young people or saddling them with crushing debt.

Next, the vilification of trade unions and the renewed attacks from the right on Public Sector Unions. In Wisconsin, Scott Walker savaged the state budget and gave it all away as tax breaks to corporations, and presided over a virtual takeover of due process in that state.

Shall I go on?

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