Ian Welsh

The horizon is not so far as we can see, but as far as we can imagine

Category: Trump Era Page 18 of 21

Trump Promises to Reduce Drug Prices

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On January 12, 2017

29 Comments

So, there was a lot of hoopla over Trump’s press conference, most of it concentrating on the release of the oppo research file on him, containing not one proven assertion.

I decided, once again, to read the actual transcript.  And found out that there was little coverage of something which should matter more to most Americans: Trump’s promise to lower Pharma prices.

We’ve got to get our drug industry back. Our drug industry has been disastrous. They’re leaving left and right. They supply our drugs, but they don’t make them here, to a large extent. And the other thing we have to do is create new bidding procedures for the drug industry because they’re getting away with murder.

Pharma has a lot of lobbies and a lot of lobbyists and a lot of power and there’s very little bidding on drugs. We’re the largest buyer of drugs in the world and yet we don’t bid properly and we’re going to start bidding and we’re going to save billions of dollars over a period of time.

The business press seem to be taking this seriously.

It is also, AGAIN, something which should have been tackled long ago. Obama deliberately refused to allow price negotiation with pharma and so did Bush. In both cases, they gave into the lobby. Insane.

Nor, as some say, will this mean that pharma prices will have to rise overseas. Pharma is a profitable industry which spends more on marketing and advertising than on drug research, which researches mostly the wrong drugs, and so on.  They can just make less money–high profits to Pharma are mis-allocated resources.

Next Trump talked about the F-35 (for those who don’t keep track, it basically can’t fly and is vastly over cost.)

And we’re going to do that with a lot of other industries. I’m very much involved with the generals and admirals on the airplane, the F-35, you’ve been reading about it. And it’s way, way behind schedule and many, many billions of dollars over budget. I don’t like that. And the admirals have been fantastic, the generals have been fantastic. I’ve really gotten to know them well. And we’re going to do some big things on the F-35 program…

AGAIN something which should have already been dealt with.

Trump thinks like a deal-maker and a business man, and what he sees is that the government is vastly over-paying for services and products, and he doesn’t like that. And what he sees is that Americans are overpaying as well, because the government refuses to act on their behalf.

I’m sorry, I’m very sorry. Trump will certainly do bad things, but if he follows through on these two things (especially pharma), he’ll be doing very good things that people like Obama would not do.

This is of a piece with Trump killing the Trans Pacific Partnership, while reports have regularly indicated that getting it passed was Obama’s most important legislative priority, likely for his entire Presidency.

Understand clearly that this is the sort of stuff that Trump was elected to do, along with bringing jobs back, curtailing immigration, and so on.

The next thing to watch will be what replaces the ACA (Obamacare). I am not optimistic, because health care accounts are a terrible idea.  But let’s see. (Or, alternatively, call your Congress critters and insist the ACA not be repealed. You might win.)

But right now, as I score it, Trump is more or less on track to do what he said he would do. I think his tax cuts will be disastrous, especially in the long run. I don’t like Obamacare, but I expect him to replace it with something worse. However, in a lot of areas, he’s talking about doing things that should have been done long ago.

When the people too many liberals think are “good” (like Obama), won’t do what everyone knows what must be done, they will eventually be done by people liberals consider “bad,” in ways liberals might not like.

There’s a lesson there.

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The Latest Dossier on Trump

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On January 11, 2017

83 Comments

Buzzfeed published it. They start with this:

A dossier, compiled by a person who has claimed to be a former British intelligence official, alleges Russia has compromising information on Trump. The allegations are unverified, and the report contains errors.

“We can’t confirm any of it, and we know some of it is wrong, but we went with it anyway.”

Sigh.

On the face of it, I’m inclined to agree with Glenn Greenwald that it seems possible the Deep State is taking a shot at Trump. Because Trump has plans to reorganize the intelligence agencies, that’s not surprising.

Perhaps unrelated: Trump will be keeping his private security, and not relying entirely on the Secret Service.

Greenwald’s point that when much or all of this is proved false, it will immunize Trump from any true revelations in the future, is also worth pondering.

I’m not sure what to say beyond that, except that reading this Twitter stream from Matt Stoller is important. It starts as follows.

Yeah. It’s just possible that Democrats lost not because of a super evil Russian conspiracy, but because they didn’t do the very basic job of government. All the bullshit lists that have come out miss the simple point that, measured in terms of jobs as a percentage of the population, the economy hasn’t recovered.

As for Obamacare, insurance coverage is not health care. If it was, the mortality rate wouldn’t be going up. The transmission is not applying power to the ground.

Democrats lost to an extremely unpopular, very flawed person, because they ran the country badly for a lot of people, and those people are upset.

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The Continued Collision Between Trump and the Fed

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On January 10, 2017

56 Comments

As I noted before, the Fed and the Trump admin are on a collision course. More evidence:

The Fed’s argument is that the unemployment rate is low enough that it is at the natural rate of employment which doesn’t cause wage-push inflation. As of December, that was 4.7 percent. (There are tons of problems with this, but we’ll ignore most of them, what matters here is what the Fed thinks.)

I am old enough to remember when an unemployment rate of five percent was considered a scandal, but no matter.

The fact is that the people who elected Trump aren’t feeling good. To make them feel good, Trump is going to have get the official unemployment rate lower than it is now, at least under four percent, and hopefully to three percent or lower and hold it there for some time, at least two or three years.

This stuff takes time to ripple through the economy, and it takes time for a tight labor market to push employers to both raise wages and to hire people who they consider marginal.

If the Federal Reserve raises rates if/when Trump’s policies (“fiscal,” in the above) start to work, they will be making sure he can’t deliver to his constituency.

This is a direct collision course.

Now let me say something simple. The Federal Reserve, for over 30 years, has deliberately crushed wages. This was policy. Policy.

The idea that the Federal Reserve should be able to sandbag the policy (“fiscal”) of elected representatives has always been anti-democratic and bogus. They work fastidiously to make sure the rich get richer, to bail out banks, and ensure their profits. Despite “full employment” supposedly being part of their charter, they have defined full employment to mean “employment pressure which doesn’t lead to general increases in wages faster than inflation.”

That is, they have deliberately set out to create stagnation and decline of general wages, while deliberately also ensuring that the rich get richer.

That’s what the Federal Reserve does in practice, and has done since the early 80s.

And that’s why, as with many of Trump’s other targets, I have no intention of defending the Federal Reserve. Yes, Trump is bad, etc. But the Federal Reserve needs to be broken to the will of government, and thus to democracy.

Since none of the “non-bad” or “not so bad” presidents did it, it will fall to Trump to do it. This will probably be the worst way to do something necessary, but so be it; none of the so-called “reasonable” people will do it, so it will be done by someone unreasonable (if Trump does it, this is not a fait accompli.)

Along with breaking the intelligence community (which could lead the world into an even worse situation, but a task that also falls into “needs to be done” category), Trump may well wind up being the most transformative President since Reagan, or even FDR.

This is what happens when the necessary actions which are not taken by “reasonable” people. They wind up being done by unreasonable people, and those unreasonable people may not be “unreasonable” in the way you like.

Keep an eye on this: If the Fed doesn’t blink and Trump doesn’t break them, he’s probably a one-termer.

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Rule of Men, Not Law

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On January 7, 2017

70 Comments

Amidst all the screaming about Trump, there is a feeling that he is being unfair by singling out various companies for attack.

This is true.

It is also special pleading.

What Trump is doing, and what he will almost certainly do when he is in office, is pick out specific groups and individuals, and he will very likely use the weight of the state against them.

Oh dear. Oh dear.

This is rule by men, yes. It has also been going on for years. Anti-war protestors and environmentalists have been singled out for special attention on the positive side of the scale.

Meanwhile, on the negative end of the stick, let us compare two financial crises. In the eighties, there was a financial crisis too, filled with tons of fraud, called the Savings and Loan crisis. It happened under a Republican president.

Executives were charged, and they went to jail.

In 2007-2008, we had a financial crisis, and from 2009 on, Obama’s DOJ applied fines, not criminal charges. Those fines immunized the participants, and since they did not take money from those who had benefited (and were often less than the profits taken by the corporation, even) they did not dis-incentivize criminal acts. Instead, the DOJ said: “There is no real penalty, so make the money when you can, and we’ll immunize you for a token fee.”

There is no question in any reasonable person’s mind that many executives had engaged in fraud, negligence, and criminal conspiracy which could have been indicted under RICO.

But hey, they were let off. Meanwhile, people who applied for mortgage relief were deliberately given the run-around and fucked over, losing their houses (see David Dayen’s “Chain of Title” if you need the blow-by-blow.)  Robo-signing by financial institutions, post-financial crisis, was also mass fraud, attesting to facts the signers had no knowledge of.

America is already a nation of men, not laws. One can say, “It has always been thus,” and there is some truth to that, but it is more a lie than true: see the S&L crisis.

People have already been getting away with lawbreaking–depending on who they are–and not small numbers of people. And if you don’t think various firms haven’t been picked out for special, positive favors, you simply haven’t been paying attention.

2000’s Gore vs. Bush ruling was “men over laws.” It was such a bad ruling that the Supreme Court tried to say it couldn’t be used as a precedent. Meanwhile, the protections of law in general were gutted: the Patriot Act, the AUMF, the rise of the vast surveillance state with its clear industrial-scale violations of the Fourth Amendment. Most Americans live in a border zone, where they don’t have freedom from arbitrary search and seizure. As for the First Amendment, the existence of “First Amendment Zones” tells you all you need to know.

Trump’s behaviour is and will be the direct consequence of how many previous Presidents acted, including Obama (who notably killed an American citizen without any trial and claimed the right to do so).

To cry now, and especially to weep for large corporations who are bad actors, is hilariously hypocritical and intensely revealing. “Trump blackmailed them into keeping a few jobs in America, that tyrant!”

Oh, My, God, the funny. Now yes, Trump has also called out people for terrible reasons. Oh well. Yes, that’s a new bad thing (though not worse than killing a US citizen without trial, the right to face his accusers, or see the evidence presented against him), but I just find it hard to get very worked up over.

You already lost your rule of law. There are a few places one can date the loss to, but I put it in Obama’s mass-immunization of financial executives. You could argue for Bush vs. Gore or a number of other places.

But wherever you put it, it already happened.

You have the rule of men. For certain people, the law is interpreted and enforced differently.

This, folks, was at the heart of Trump’s attacks on Clinton for e-mail, which liberals laughed off.  But we all know that if some peon had done the exact same thing, they would have been ruined and probably gone to jail.

You already lost rule of laws, and had rule of men.

You have already paid a frightful price for this. The reason your economy is so bad is because bankers were immunized and bailed out, staying in charge of your economy when they are incompetent crooks and ordinary people were not bailed out.

Not coincidentally, minus not bailing out ordinary people, Trump does not win election in 2016.  (He also wouldn’t have won if Obamacare was not so flawed, but that’s another post.)

Trump is just the continued price for breaking your own laws and constitution, and your own unwritten norms.

As such he falls under “as you sow, so shall you reap”.

Until large numbers of Americans see it this way, including at least some faction of elites or would-be-elites, there can be no true fix for this situation, whatever happens with Trump.

Trump is the symptom, not the disease, and until you treat the disease, things like Trump (or the financial crisis and the lack of real recovery from that crisis) will continue to happen, and fools will continue to be bewildered by them, as if the very public actions of the people they elected had not led to them.

Machiavelli wrote, and America’s founders agreed, that good men could make bad laws work, and that good laws could not save bad men.

The founders’ equivalent was that eventually Americans would become so degraded that they could only be ruled by despots.

Americans have given many signs of being this degraded, and now it’s up to Americans to prove that they aren’t.

Don’t dare to say this is all on “deplorables” or Republicans, because Democrats have not just been complicit in all of this, they have spurred it on in deliberate ways–as with Obama on surveillance, drone murder, and whistleblowers.

It is on Americans.

Americans are reaping as they have sown. That all Americans are not bad or degraded is not the point. Enough of you are, and your elites are corrupt as a class, so much so that I would easily expect, in nine or ten years, to be fundamentally unethical and unsuited to public life. That includes, by the way, Bill Clinton, Bush Jr., Obama and Hillary Clinton.

Trump is what Americans have earned.

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Trump and the Art of the Strongman

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On January 6, 2017

50 Comments

Trump has now taken a number of firms to task, over Twitter, about moving jobs to Mexico. While there’s some disagreement, it seems that some critics have backed down.

“I know from talking to business people that no major firm wants to be a subject of a Trump tweet,” says Gary Hufbauer, a senior fellow at the Peterson Institute for International Economics. He says companies realize Trump controls the Justice Department, the Defense Department, the IRS, the Treasury and regulatory agencies, and “the amount of control that intersects with what companies are doing is enormous.”

This is, first, an implicit rebuke to all the Presidents who did nothing, and to all the fools who said they could only do nothing.

But, it is also about the art of getting powerful people to bend to your will.

The classic method is to pick out someone, someone powerful, and break them. Humiliate them, destroy them, and do it publicly. Make them grovel.

You make an example of someone. In almost every case, and certainly in Trump’s case, were the powerful to band together, they could easily take you down. You must make sure they don’t do that.

So you make an example of someone, and then you treat others kindly.

“You can have tax cuts and beautiful labor law cuts and a privatizing stimulus, but in exchange I need you to keep jobs in America and bring some back.”

That’s the deal.

The problem is that many CEOs and billionaires will want to take all the goodies, and still move jobs overseas. Normally, in fact, that’s what has happened: Tax cuts were given, and the savings were used to accelerate offshoring and outsourcing and to do massive stock buy-backs to enrich executives.

So Trump is putting companies on notice that this won’t be tolerated, and I believe to really drive the lesson home, he will need to break someone.

Be very clear, this is easy to do. The President is fantastically powerful. Unleash the FBI, NSA, DOJ, and IRS on any major firm, and you will find offenses. Moreover, in almost every case, they will include criminal offenses–if you allow them to be.

Then, you charge executives with crimes rather than immunizing them with fines, and you tie them up in court for years. If they lose, you throw them into a maximum security prisons, and you let bad things happen to them.

Even before this sequence is through, people will get the message.

Presidents have chosen NOT to do this, even in cases of rampant corruption and criminality (Obama being the worst offender by far, with his wholesale immunization of fraud and racketeering in the financial industry).

But you don’t have to play the game that way, and I’m guessing Trump won’t. And that’s why executives are bowing, because they’re scared he will break someone to demonstrate his power, and they don’t want to be the executives he hauls out of the crowd, to whom he has his goons deliver a beat-down.

This is nasty pool, but I wouldn’t weep for whoever becomes the example. They’ll almost certainly have it coming. The injustice won’t be in what happens to them, but in the fact that all the others will be let-off so long as they kow-tow.

We’ll talk more about this principle, with regards to the Federal Reserve and the intelligence community, for now, watch for it.

(Trump gets his second term if he delivers enough for his base. This is existential for his administration.)

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2016 In Retrospect

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On January 3, 2017

61 Comments

There seems to be a general belief that 2016 was a particularly bad year. Part of that is the twin political events of Brexit and Trump, and part of it seems to be that a number of particularly beloved celebrities died.

But unless you were in a few specific places, like parts of Syria, and certainly if you were in most of the developed world, your odds of having something bad happen to you were about the same as they had been in 2015.

Certainly Brexit and Trump are both, potentially, earthquakes, though their severity remains to be seen, and I regard both as consequences of decisions that were made over a period of decades.

What made them seem so severe, I think, is that they were, to the liberal classes, surprises. In both cases, polls indicated they wouldn’t happen; and it was conventional wisdom among certain groups that both events were absurd.  Trump, in particular, was treated as a grotesque joke when he announced his candidacy, and right up to the last moment, almost literally, icons such as 538 and the New York Times insisted he was almost certain not to win.

When he did, an entire world view went away.

Because they thought it had been impossible for Trump to win. He was a joke, according to that world view, and those who held it have seized, in particular, on “Russia did it!” It was a deus-ex-machina, because their world model simply cannot accept that it happened.

And, in both cases (Brexit and Trump), there is a great deal of shaming and othering of those who voted the “wrong” way. They are castigated as stupid and immoral, people who are too dumb to vote in their self interests, to understand how the world works, motivated almost entirely by racism.

Bad people.

So many liberals in America and Britain now believe they live in countries where half the voting population are evil, stupid racists and that those people are now in charge.

Oh, and the big, bad Russians are also responsible.

While some are willing to admit that perhaps, just perhaps, the policies that even they voted for and/or supported (under Blair, Clinton, Obama, and the EU) might have something to do with all of this, the metaphysics of most essentially boils down to the notion that bad people (Russia, racists) combined with stupid people, are destroying our world.

Because they can see little responsibility for themselves (either in past policy or in the specifics of the campaigns (Clinton’s was notably incompetent)), they have eviscerated their sense of their own power, and thus their ability to create change.

Responsibility and power are exactly equal to each other. You have exactly as much power as you have responsibility, any mismatch is a denial of reality, and if society abets you in denying that reality, as it often does, by giving you more credit or less blame than you deserve, it does not change either your responsibility or power.

It is also true that an accurate perception of blame enables correct action. When Clinton and her team completely fumbled their campaign, not removing them from all positions of power indicates a willingness to tolerate failure again and again. Indeed, after Clinton, the presumptive front-runner, was defeated by Obama in 2008, perhaps the realization should have dawned on us/her that she and hers were incompetent and that she should not be the presumptive candidate. She started with a vast advantage and lost it.

Meanwhile, in the eight years Obama has led the Democratic party, vast losses have occurred in State Houses and Congress.

As for policies which have lead to vast numbers of Britons and Americans being willing to vote for Brexit and Trump; well, I have written on those subjects more than enough.

Liberals and centrists, as a group, deny responsibility, and thus deny agency. They refuse to put the locus of responsibility in those areas over which they have control. Instead, they blame forces over which they have no control (Russia) or over which they have less control (the current racism that is ex-nihilo, completely unrelated to the policies they have championed for decades).

It is not the crisis, as such, that predicts the future, it is the response. I was able to accurately predict the shape of America and Europe’s economy because I saw the response to the crisis in ’09. The day the outlines of Obama’s stimulus were announced (he’d already fumbled the bailouts, by bailing out the rich rather than ordinary people), I wrote that American jobs and wages would not recover for 20 years. Eight years later, that’s still looking accurate. (The unemployment rate is not what matters here, the jobs/population ratio is.)

So, seeing the liberal response to 2016’s political crises, it is clear that, at least so far, liberals have not learned the necessary lessons. Thus, trends will continue in the wrong direction. Locating the problems as beyond their control, liberals have self-emasculated.

There is still time for that to change, and perhaps it will. So far, however…well…

Happy 2017.

The results of the work I do, like this article, are free, but food isn’t, so if you value my work, please DONATE or SUBSCRIBE.

Trump Is the Next Stage of the Disease

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On December 22, 2016

120 Comments

One of the more common mistakes regarding Trump is to see him as something that came out of the blue; unheralded and strange.

Trump is a kleptocrat. The US is a kleptocracy. It “formally” became a kleptocracy when the Supreme Court ruled in Citizen’s United that money was speech. (It is ironic that Trump won with less money, but it doesn’t change this fact.)

America was pragmatically a kleptocracy in 2009, when Obama entered office and continued his predecessor’s policy of bailing out bankers, taking houses away from little people and not prosecuting bankers for clear crimes.

Punish the people without money; let the people with money walk.

Trump is a walkimg emoluments violation: He should be impeached month two of his term for his refusal to sell his company.

But he won’t be (though he may eventually be impeached if Republicans decide they’d rather have Pence as President, and that they don’t think Trump’s followers will personally visit their houses to discuss the issue).

Kleptocracies are run for the benefit of the rich. It is that simple. A monarchical kleptocracy like Putin runs, and like Trump seems interested in running, makes sure the peasants get something, which means it may feel slightly better than what came before it. (Putin is very, very popular and was so even before the recent wars for the simple reason that Yeltsin was far, far worse.)

But they are still kleptocracies. Trump’s first order of business is tax cuts, mostly for the rich. There is a report that his team has asked for information on funding of environmental groups, and Trump plans on shutting down NASA’s climate change group.

These things get in the way of making money; and because environmentalism was pushed during a period in which the economy was, for too many people, a negative sum game, it is also unpopular with his base.

But these things are extensions of the already-existing Republican party orthodoxy. Tax cuts and fuck-environmentalism is where Trump stands in solid agreement with the kleptocracy that already ran the country. These things are not what make Trump interesting, or unique, they are what make him simply another stage of the disease.

Understand that what we had in 2016 was a crisis point. There were three options. Clinton was for the status quo kleptocracy. More or less the same, with a bit more help for those hurting the most, like students.

Trump was for monarchical kleptocracy, minus globalism: add tariffs and one-to-one trade deals to the mix, change up the foreign policy, make sure some more people get jobs, while gutting worker rights in general.

Sanders was an opportunity to actually change some of the key domestic policies away from kleptocracy: While not ideal, he was clearly a change from the status quo in a kinder direction, and he came fairly close to winning the Democratic primary, despite an active conspiracy by the DNC to stop him (no, no, it meets the actual definition of conspiracy).

Of those three options, Americans chose Trump: a new stage of the kleptocratic disease. Double down on transfers to the rich, but let’s give more scraps to the poor and fuck over some foreigners to get those scraps while burning up the world even faster. (Obama was not good on the environment; he was bad, but Trump will be much, much worse.)

I am not panicking, or running around screaming. I regarded something like Trump as nearly inevitable, with a small, but real, chance to avoid him by embracing the populist left (in this case, championed by Sanders).

In fact, Trump is not as bad as what I expected. His victory, a squeaker, may wind up precluding Trump 2.0, that is, the guy who would run next time, having learned from Trump what was possible, but far more disciplined, focused, and ideological than Trump.

Trump has the support of some powerful ideologues (most notably Bannon), and he has a world view, inchoate as it is, but he’s a very flawed man. Despite being very good at getting what he wants, it is undeniable that he lacks discipline, focus, and a broad base of understanding. Nor does he self-identify as being ideologically driven. Bannon may want to be the Lenin of the right, Trump does not.

More to the point, because the actions of US elites (and the world’s), along with the repeated votes of US voters, kept pushing America down this path, for decades, I regard running around screaming as pathetic. It’s like running full speed at an oncoming train for five minutes, with plenty of opportunities to veer off, then complaining when you get hit.

Many Americans, and the vast majority of their elites, affirmatively chose, repeatedly, to take actions and institute policies which were most likely to lead to Trump. Those who opposed those policies lost, and a huge chunk of the population sat on the sidelines doing nothing.

There were many, many opportunities to turn away from this path; the largest was to NOT bail out bankers in 2009.

In 2009, I wrote the US off. I knew that Obama had affirmatively made the choice to save oligarchy from itself (quite different from FDR saving capitalism, but not oligarchy). I knew then that something like Trump was the most likely outcome, but I expected worse than Trump, so far, seems to be.

So running around screaming is ridiculous. This was a choice, made affirmatively, repeatedly. If Trump had lost to Clinton, Trump 2.0 would have tried in 2020 and almost certainly won. The US is a kleptocracy, and eventually the disease would move to the next stage, if not reversed.

What I seek to do now, with regards to Trump, is two things. The first is simply to understand him and his movement. We’re going to be living in his America; it’s his world, for some time, so we’d best figure it out.

The second is to poke people who didn’t and still don’t get it, because until enough people do, we will keep losing to kleptocrats (whose number includes both Clintons) and people like Trump.

These two things are meant to support realistic assessment of Trump, the US, and the world so that effective action can be taken.

I have a friend who, as a result of Trump, is leaving the US with his two children. He has carefully looked at Trump, made his assessment of the US’s future and chosen a course of action. That is effective.

Make your assessment, take your action. Stop the hysterics. I strongly recommend that many people, who are most worked up, take two weeks off the internet, except for unavoidable work related tasks. Calm down, think, and decide what you need to do for yourself and your dependents. Heck, depending on who you are, you might even be one of the winners from Trump (they will exist).

Then decide what you’re going to do. Understand the consequences of your actions. Make your assessment. If you really think Trump = Hitler you should be getting the fuck out or preparing to fight, and I do mean fight. If you don’t, what do you think he is?

Get real.

In the meantime, I will continue to keep an eye on Trump and his team and try to provide analysis without hysterics or panic. Fear may be appropriate (it is for some people, for sure), panic is not.

But it will be vastly harder to fix this if people keep pretending it wasn’t affirmatively chosen, and not just by people who voted for Trump this time, but by everyone who supported the previous status quo, starting around 1980. Kleptocracy is neoliberalism’s child, its logical end-result, and Trump is just a new stage in kleptocracy, and yes, many people worked hard for this including most people who voted against Trump.

Understanding how and why you got here is necessary to get out of here–not in one piece (it’s too late for that), but without losing any body parts you’ll really miss (always choose to lose a leg–the prosthetics are great).

Trump: Just another stage in the disease of kleptocracy, made inevitable by neoliberalism and affirmatively chosen by modern “liberal” hero, Barack Obama.

Own it.

The results of the work I do, like this article, are free, but food isn’t, so if you value my work, please DONATE or SUBSCRIBE.

Trump and the Taming of the Oligarchs

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On December 21, 2016

48 Comments

Some years ago, I read an article about a Russian oligarch who had wanted to close a factory in a Russian town in which the factory provided the only real jobs.

The people complained to Putin, and some time later Putin appeared on stage in the town with the oligarch. With an eye on the oligarch, Putin explained that the jobs would be kept in the town.

Putin’s speech was described as being cold and contemptuous towards the oligarch.

When Trump convinced Carrier to keep some, not all, jobs, in America, he did so largely through bribes.

What will be interesting, however, is to see how much he makes people bow.

Putin broke some oligarchs and allied with others, but the important thing to understand about Putin’s relationship with Russian oligarchs is that Putin is the senior partner. He is in charge. They can do well, even very well, but if they challenge him, he will force them to bow–or break them.

(For the record, I have less than zero sympathy for the oligarchs; I know how they made their money.)

We all, I presume, remember the picture of Romney meeting Trump, begging for the Secretary of State job (which he didn’t get). I suspect Trump really did want to give the job to Romney, simply so he could force Romney to bow on a regular basis, but Trump’s loyalists hated Romney too much.

Meanwhile, the tech oligarchs have all also met with Trump. He was gracious, but they came to him, despite their clear opposition of him.

One of the issues in the US is that its oligarchs think they don’t have to serve the public good. Apple and other companies have billions stored overseas, they dodge taxes, and they move jobs overseas at the drop of a hat.

They also think they don’t have to bow to the President.

Now Trump cares somewhat about Issue (by which I mean jobs, not tax dodging), but he’s going to care a lot about Issue (bowing to the President). And Bannon cares a lot about both, because Bannon despises America’s oligarchs and wants to see them humbled.

Trump, well, Trump likes power. He wants to be loved by the mob, oh yes, but he values loyalty greatly, and, if crossed, he likes breaking people.

So I expect to see a number of oligarchs and other powerful people made examples of, forced to bow–indeed, forced to kneel.

If Trump wants to get his way, this is necessary. He needs these people to do some things they don’t want to do (make less money by bringing jobs back to the US), and they’ll need to be scared of him.

They need to be personally scared. They need to believe they personally aren’t immune from his power.

Trump will enjoy this. Bannon, if I read him correctly, will enjoy it even more.

Under Trump, oligarchs will do well, even very well. But not if they don’t bow. He wants some crumbs for ordinary Americans, and he needs the oligarchs to give them.

So one of the ways I will know if Trump is going to be successful (i.e., get his people enough goodies to get his second term, and the accompanying adulation) will be by watching the “kneeling to bribes” ratio, and seeing what Trump does to those companies who refuse to cooperate.

Be very clear on this, folks. This is something about which most people are complete idiots.

There is nowhere to go.

The rich cannot actually move their companies overseas. Where are they going to go? Europe will regulate them even harder (see all the problems Google is having). They don’t want to live in China or Russia, and China and Russia are the only countries strong enough to tell America to bugger off. Plus, of course, Putin and the Chinese Communist party won’t just make them kneel, they’ll make them get down on their bellies and grovel like worms.

No one else can stand up to America. Oh, Europe could, if it had its act together, but it doesn’t; and it wants regulation that repel oligarchs. Tax havens are a joke; they exist because the great powers want them to exist, and the second the Treasury cracks down on them, they will go away.

So if Trump wants to put the screws on, he can–especially if he’s smart about it. You make an example of a few people, you reward the others for cooperating, and soon they’re all bowing and scraping.

That’s how it works.

Let’s see if Trump knows how to play the game.

(And, for the record, no, this isn’t good. But the financial crisis proved we already have rule of men, and that this rule is to be used solely to enrich the few and immiserate the many. Rule of law will continue to disappear. I have no sympathy for most of the US’s oligarchs, because, while not as outright nasty as Russia’s oligarchs (on average–some of them are just as bad), they are almost all truly bad people who have strangled the US, and the world, to get where they are.)

The games are on, Caesarism continues its rise. It’s what Americans voted for and elites worked hard to create the conditions for it. Crying over it is like crying over physics.

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