A Democracy in Name Only  

November 4, 2011

We have  become a democracy in name only.  We are a corporate oligarchy, controlled by the big corporations.

Once upon a time, from about 1945 to about 1975, the fate of the American workers and the big corporations were tied together.  As the big corporations prospered, the wealth created by the American workers was shared with the American workers in the form of increases in the real pay received.

This shared prosperity between the corporations and American workers created the great American middle-class, which was the envy of the world.

But, the big corporations began buying and selling imports from low-wage third-world countries, which destroyed many of our industries, such as steel mills, electronics, ship-building, etc.  And countries such as Japan, Taiwan, and South Korea prospered.

And, then the big corporations and their lobbyists got the American politicians to further increase free trade with countries such as China, and the wholesale destruction of the once-great American economy began.

Buy building tens of thousands of factories in China, the American corporations could keep the profits that had once been shared with the American workers.  Chinese workers could be paid a tiny fraction of the wages that were being paid to American workers.

This allowed the corporate profits to increase, since very little of the profits had to be shared with the low-wage Chinese workers.

Industrialization created our middle class, and de-industrialization will destroy our middle class.  China now has our factories, and its economy is booming.

And a shrinking middle class will not be able to compete with the money flowing into election activities from the wealthy corporate interests. And the politicians will listen to their wealthy donors, not the unemployed and those being crushed by our declining economy.


11 Responses to A Democracy in Name Only

  1. Sidney Rosenbloom on November 5, 2011 at 12:26 am

    This dire problem of three decades of ever increasing speed of outsourcing now many kinds of jobs is also cultural problem, therefore very hard (close to impossible?) to address in an effective way.

    1) We are so proud and in one degree or another conditioned to believe in American exceptionalism that we – on the right or the left and in the middle – are resistant to see things straight and at the same time suckers for FOX and anyone who know how to push this hot button of ours.

    2) We, like our British cousins, love wheeling and dealing, marketing, advertising, arguing, financial trick, lawyering, “creative” and “persuasive” writing, communication, anything only not math, science, engineering. We even didn’t adopt the metric system because Ronnie Reagan told us it is un-American and socialist idea.

    3) We gave no answer to the question how it is posible that say Germany despite
    – paying some of the highest wages in the world
    – spoiling its workers with benefits we, Americans, are not even allowed to dream about, such as 5-6 weeks of annual vacation (which people actually take!), true universal healthcare (not just soon to be scrapped ObamaCare), unemployment benefits one can actually take a family to a small vacation in Greece or Crete, free university education (therefore not crushing student loan debt like here), etc. etc.
    – labor law and environmental regulations at least as stringent as we have here
    – euro, which is in only 9 years of its existence up 40% against US dollar (while we are still being told that weak dollar will make us competitive)
    – taking care for 20 years now for an extra 1/3 of its original population, East Germans, who have been ravaged under Soviet occupation and communist mismanagement (while we would certainly not be able or willing to take back 100 millions of former fellow citizens because we “can’t afford” extending Obama Care to 30 out of 50 million citizens who still don’t have any medical insurance)
    – not having 60 years since WW2 of free ride via monopoly on printing the world’s reserve currency (as we still have)

    despite all of the above and more, Germany continues, year after year, for many decades, make so many high value-added TANGIBLE products that the resyt of the world is willing to buy, that only year+ ago another, 15-times larger export machine, communist China took over as #1 in export surpluses.

    The problem is CULTURAL. On a top of that, neither party, no think tank to speak of, no noticeable force is proposing EXPORT-oriented economy and societal mind set, with educational system, some corporate priorities and sensible governmental policies supporting that.

    We will “democratically debate”, comment NYT articles, elect GOP which proposes still less taxes or Dems who propose print more and give away more to welfare hole.

    We met our enemy and it is us. We are doomed.

  2. Boris K on November 6, 2011 at 11:18 am


    I’m passionate about getting American jobs back as well. But, unlike you, I cannot blame the Wall Street for craving what’s in their nature: greed; it’s like blaming wolves for not being vegetarians, or politicians for lap-dancing to the tune of their benefactors. They act according to their nature, and fighting it is irrational.

    Instead, why don’t you spread the message of “buy made-in-America” to people of our nation and see what they do? If they do become more selective and buy more of what is still being made here (as opposed to cheap goods made in China) and show some loyalty to American companies, then we will see more investments being made locally. If not, then why blame nature for ignorance of our citizens?

    Even if you reach just a few souls with this message, you will have made a difference.

    By the way, do you buy American products? I do.

    Best wishes,
    Boris Kuperman

    • TaxiDriver on November 10, 2011 at 10:26 am

      There are a few difficulties with a “buy American” message campaign.

      First, as more Americans lose their income, they are increasingly forced to buy the cheap foreign-made stuff. American products will necessarily be more expensive for a number of reasons. So, even though they might “like” to buy American, they cannot afford it without sacrificing whatever shred of happiness they have left.

      Second, it only requires a simple majority voters to change our import policies, but it would require unanimity of Americans to be faithful to buying American. If a simple majority of Americans were to buy exclusively American products, that could still leave the foreign products with a 49 percent market share, and damage would still be done.

      Third, since foreign labor is cheaper, it’s more difficult for American manufacturers to match the quality of foreign-made goods even at a higher price. This tends to erode the reputation of American goods in favor of imports. As American manufacturers continue in their disadvantage, their products fall further behind, as their foreign competitors are able to enjoy higher levels of profit-reinvestment in R&D, making American products all the less competitive.

      Fourth, at the consumer level, it’s almost impossible to determine the true domestic content of a product. Years ago I had envisioned a TV commercial with two crates being loaded off a ship. There is one big crate, and one small crate. The big crate contains a car, while the small crate contains the wheels for the car. The wheels are installed on the car, and the words “Made in USA” are then stamped on the big crate. Although many Japanese cars are “said” to be made in USA, the fact remains that final assembly constitutes less than 15 percent of total added value. If 100 percent of the components are imported, is it really made here?


  3. Wanderingbear on November 6, 2011 at 11:53 pm

    Thing is that the rich don’t need the working class any more. They are replacing the American working class with technology.Fully automated factories that have an AI and can run with out anyone to be there. No more need for office workers. Computers with artificial intelligence will replace them.Sales people. The new automated checkout is already in the process of replacing them . Where will the working class go when this has taken over everything and there’s no need for the American worker?

  4. Yuriy on November 7, 2011 at 4:01 pm

    Very good points by both the author and commentators. To complete the picture, why don’t we consider the humongous growth of the government? What used to be “by the people for the people” became “by greedy non-productive lazy assess for the highest bidder”. The bunch of spineless inventors of political correctness decided that they know what American people need!
    Yes, Wall street is dysfunctional from the capitalism stand-point. But it’s perfectly functional from Wall street and Washington standpoint! It works for THEM just fine!
    To Boris K. – I have no problem with gamblers for as long as they gamble with THEIR OWN money. Let them win, let them lose. A game is a game. But let me ask you – if yo come to Vegas (or Atlantic City), can you borrow from Casino, lose everything and expect to be paid back what small change you arrived with? Why the entire country has become the sucker who funds their games?
    If we want this country back, let’s start with the basics – enforce the laws! Let people decide HOW they want to spend their taxes and incomes. Make serving the country in the government a limited-term privilege, not lucrative do-nothing get set for life career.
    I remember my grandfather, who fought Nazi Germany in WWII showed me a tool, which proudly stated “made in the USA” (during back in the USSR days). It was a stamp of highest quality, durability and long life! We need it back! We don’t need a buy-buy-buy disposable society mentality.

  5. TaxiDriver on November 10, 2011 at 8:39 am

    The government is continuing in its fine American tradition of government based on one dollar, one vote.

  6. Boris K on November 13, 2011 at 1:05 pm

    TaxiDriver, I agree with everything you said (all 4 points). However, as a decent, conscious human being, I simply do “what is right” – that’s how you and I were raised. Not because it will change the world, but because it is “right” (the opposite of wrong).

    People always have reasons not to do what’s right: walk away from a crime because it’s too dangerous to stand up to criminals; buy cheap to save money (and living on a low-wage for number of years in the past, I know the temptation); saying to yourself ‘how will doing what’s right can change the world?”

    The answer is: I do not strive to change anyone – the world, our country, or the people living here, only meself. Changing people who are not ready or are not willing to evolve will only lead to disasters; and we know many such failed and tragic efforts (i.e., revolutions).

    Voting for the “lesser of two evils” is not going to bring you a democracy nor a great community. It will however offer an excuse of not doing what’s right, unpopular, or sometimes even dangerous: pointing at the evil and calling it that: Evil.

    When more of us evolve, society and its government will change. It won’t be soon. But that is not an excuse for me to do what is wrong, even though it’s easy.
    Change yourself and you will change the world.

    • Boris K on November 13, 2011 at 1:22 pm

      If only 10% of all adults in America made a choice to buy Made-in-America products every now and then, this country would change. 🙂

    • TaxiDriver on November 14, 2011 at 7:54 pm

      Voting for the “lesser of two evils” is not going to bring you a democracy nor a great community.”

      You touched on another pet peeve of mine… you are definitely right. But voting “the lesser of two evils,” as you put it, implies that somebody waited until the general election to *start* voting, and then only voted seriously for the president when the choice became boolean.

      Real change happens long before that. Once the nominees are slated, it’s too late to seriously affect policy. For example, how many of us have donated to Buddy Roemer’s campaign? How many of us have even HEARD of Buddy Roemer? He has garnered more poll support for the Republican Primary than some of the candidates who got to participate in the debates, yet he was excluded from them. It just so happens that Buddy’s campaign platform is full square with the platform of this website. He wants to get rid of NAFTA (and HE MEANS IT), get out of the WTO, and secure our borders from the incursion of cheap labor.

      If we wait until the General Election to act, then we are left merely with the choice of “the lesser of two evils.” The time to act (as far as elections go) is now.


      • Boris K on November 14, 2011 at 9:10 pm

        Well, now you’ve introduced me to Buddy Roemer, and I will look into his positions. Actions do have impact. BK

  7. jlshand on December 11, 2011 at 4:24 pm

    I am more pessimistic then I have ever been and my pessimism is increased by my belief that there is more than one credible explanation for the “fix” this country is in. I invite comment and hopefully contradiction to the following points.
    1. Our economy’s outlook is worse than it was in depression times
    a. We have gone from a manufacturing position which represented the majority of whatever measure passed for GDP in those days, to less than 20℅ of GDP today
    b. That manufacturing was heavy, represented a large % percentage of middle class jobs, and is NEVER coming back at least as long as capitalism buys into totally free trade.
    c. we are no longer, given our dependence on energy from outside our borders, in a position to isolate our selves and our marketplace with high tariffs.

    2. Seventy percent of GDP is consumer spending these days , but the middle class can’t spend when it fears job loss and further indebtedness.

    3. CEO’s of Big Transnational Corporations are charged first with increasing their companies share value. If they don’t do this they are replaced by shareholders/Directors
    a. Shareholder/Board Directors tend to be top one percenters who share the standards and values of the CEOs
    b. Transnationals recognize the future profit opportunities worldwide are NOT in the USA.

    4. Our political system particularly at the national congressional level has devolved into a system far from what our founders envisioned. At least what the Jeffersonians envisioned which was public spirited citizens, granted from the land owning class, serving short periods of service at great personal hardship, in Congress. Certainly not career public servants.
    a. the complexity of this service, the personal advantages of reelection and the influence of a growing number of limitlessly funded lobbyists have created a self serving complex of industry and government. More interested in profit and personal wealth then the concerns of the great majority of Americans

    5. Advances in technology have perhaps inevitably, increased the advantages of Globilization
    a. Multinationals are required to increase shareholder value and nothing but a closed American market or a downward restructuring of our middle class wage and benefit structure can bring major manufacturing back from China, and other minimum wage states.

    6. There really isn’t a whit of difference between out two ruling parties altho the Dems seem to screw us with a little less joy.

    7. The USA has enjoyed a greater share of this worlds resources than its population percentage perhaps deserves

    Are there solutions?….

    1. Is globalization inevitable

    2. Is it planned in order to even out world resources?
    3.. Is the middle class relegated/resigned to having less until we become competitive in wage and benefit?
    4. Can our federal congressional structure serve all Americans ever again?
    5. Is there anyway to change the growing spread between haves and have not in this country despite Globalization?
    6. Can Capitalism work for all classes here or did it ever work that way?
    7. Do the moneyed classes have a clue about the anger and resentment of so many Americans?
    8. Will there be more blood in the streets come national election time?

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