Click amount to donate direct to CounterPunch
  • $25
  • $50
  • $100
  • $500
  • $other
  • use PayPal
DOUBLE YOUR DONATION!
We don’t run corporate ads. We don’t shake our readers down for money every month or every quarter like some other sites out there. We provide our site for free to all, but the bandwidth we pay to do so doesn’t come cheap. A generous donor is matching all donations of $100 or more! So please donate now to double your punch!
FacebookTwitterGoogle+RedditEmail

Gov. Walker and the Ghost of Andrew Mellon

After the Great Crash of 1929, Andrew Mellon, one of the wealthiest men in America as well as Secretary of the Treasury, gave President Hoover a bit of advice right out of the playbook of laissez-faire capitalism.

Liquidate, liquidate, liquidate.

Liquidate banks, liquidate factories, liquidate commercial and private real estate, liquidate farms and liqudate ranches. Let it all collapse and then the economy would correct itself, slowly but surely, as those still in possession of capital scooped up undervalued assets, cranked up the wheels of commerce and industry, and hired back workers now willing to work for a fraction of what they used to make.

Hoover, a conventional though not cruel or even callous man, turned a deaf ear to Mellon’s advice; like our current President, he tried to steer the country out of crisis by adopting fiscal and monetary policies informed by the “best minds” of the day.

As we all know, those policies either proved to be too little, too late or – in the case of his trade policies – aggravated the downtown. By 1932, unemployment peaked at 24 percent and the nation’s GDP had shrunk by more than 40 percent from its high point in 1929.

Now, it must be pointed out that, in a crude and almost autistic fashion, Mellon was correct. Allowing the country simply to go bankrupt would, eventually, have resulted in economic recovery. Certainly it was not the only road to that recovery, and surely not the one most likely to provide a decent living for the overwhelming majority of Americans.

An amped-up version of the somewhat tepid policies of the New Deal would also have achieved full economic recovery. In the end, the version of the New Deal that was implemented helped ameliorate the worst effects of the Great Depression – at least enough to prevent revolution — without quite marshalling the resources to end it.

In the confrontation taking place right now in Madison, Wisconsin Governor Scott Walker seems to be channeling the ghost of Andrew Mellon in his attempt to liquidate that state’s public employee unions. His budgetary arguments are, of course, a sham, a cover-up for long-held ideological opposition to the union movement. At the same time, it should be pointed out that neither side is directly addressing the foundational cause of the Great Recession that lies behind the standoff: the fact that, as it “matures” (if that is the right word!), capitalism can only survive by creating ever more frequent – and desperate — crises of the kind we’re struggling with right now.

From its beginnings in 16th and 17th century England and Holland, capitalism has depended upon a minimum 3 percent accumulated growth rate year in and year out. If growth exceeds that 3 percent – as it has lately in China and India – so much the better.

But if the rate of growth falls below 3 percent, even for one or two quarters, capitalism, which, like the stock market, is absolutely dependent upon a faith that defies logic and anesthetizes memory, begins to sputter. Each time that faith is shaken, it becomes harder and harder to restore.

Of course any organic system that cannot live without endless growth is ultimately doomed. Critics sometimes like to refer to capitalism as a cancer; they are closer to the truth than perhaps they realize. Another name for endless growth is malignancy. In the end, a malignant entity cannot help but cannibalize its host body. This is the process we see at work today, both in the implosion of the “American Dream” and in the spreading destruction of the global ecosystem upon which all life depends.

Scott Walker’s assault on collective bargaining – on, in fact, the whole union movement – is no doubt driven by a mix of motives, including simple political payback. Whatever the immediate outcome, he has already lost the political war; it’s one thing to offend public school teachers, an altogether different matter to find the Governor of Wisconsin on the receiving end of opposition from members of the Green Bay Packers. As a bonus Walker has also driven one of the first nails into the coffin of the faux-populist Tea Party Movement.

More importantly, the protests he has sparked mark some of the first death throes of American capitalism, a political economy that is no longer even particularly interested in providing meaningful work for 98 percent of the population, and manages to stagger along largely by creating speculative bubbles from which only banksters and hedge fraud managers profit.

As the World Social Forum likes to say, “A better world is possible.” No one can foresee what might replace American capitalism when – not if – it inevitably falls. But one thing the protestors in Madison have demonstrated is that the transition need not be violent or even psychically traumatic. An effective antidote to the alienation that, along with false consciousness, is one of the only commodities produced in abundance by Stage 4 capitalism is to act in solidarity with others to bring about a better world for everyone – not just oneself.

Certainly the public employee union members who have poured into Wisconsin this past week have, as their primary concern, the protection of hard-won rights to collective bargaining. At the same time, they may very well be in engaged in something of far greater significance.

It is possible – very possible – that they have, with Scott Walker’s unwitting help, initiated the peaceful transformation of that part of the earth occupied by the United States of America into a better world for all its citizens.

RICH BRODERICK lives in St. Paul and teaches journalism at Anoka-Ramsey Community College. Rich is a writer, poet, and social activist. He can be reached at: richb@lakecast.com

This essay originally appeared in TC Daily Planet.

 

 

More articles by:
Weekend Edition
October 19, 2018
Friday - Sunday
Jason Hirthler
The Pieties of the Liberal Class
Jeffrey St. Clair
A Day in My Life at CounterPunch
Paul Street
“Male Energy,” Authoritarian Whiteness and Creeping Fascism in the Age of Trump
Nick Pemberton
Reflections on Chomsky’s Voting Strategy: Why The Democratic Party Can’t Be Saved
John Davis
The Last History of the United States
Yigal Bronner
The Road to Khan al-Akhmar
Robert Hunziker
The Negan Syndrome
Andrew Levine
Democrats Ahead: Progressives Beware
Rannie Amiri
There is No “Proxy War” in Yemen
David Rosen
America’s Lost Souls: the 21st Century Lumpen-Proletariat?
Joseph Natoli
The Age of Misrepresentations
Ron Jacobs
History Is Not Kind
John Laforge
White House Radiation: Weakened Regulations Would Save Industry Billions
Ramzy Baroud
The UN ‘Sheriff’: Nikki Haley Elevated Israel, Damaged US Standing
Robert Fantina
Trump, Human Rights and the Middle East
Anthony Pahnke – Jim Goodman
NAFTA 2.0 Will Help Corporations More Than Farmers
Jill Richardson
Identity Crisis: Elizabeth Warren’s Claims Cherokee Heritage
Sam Husseini
The Most Strategic Midterm Race: Elder Challenges Hoyer
Maria Foscarinis – John Tharp
The Criminalization of Homelessness
Robert Fisk
The Story of the Armenian Legion: a Dark Tale of Anger and Revenge
Jacques R. Pauwels
Dinner With Marx in the House of the Swan
Dave Lindorff
US ‘Outrage’ over Slaying of US Residents Depends on the Nation Responsible
Ricardo Vaz
How Many Yemenis is a DC Pundit Worth?
Elliot Sperber
Build More Gardens, Phase out Cars
Chris Gilbert
In the Wake of Nepal’s Incomplete Revolution: Dispatch by a Far-Flung Bolivarian 
Muhammad Othman
Let Us Bray
Gerry Brown
Are Chinese Municipal $6 Trillion (40 Trillion Yuan) Hidden Debts Posing Titanic Risks?
Rev. William Alberts
Judge Kavanaugh’s Defenders Doth Protest Too Much
Ralph Nader
Unmasking Phony Values Campaigns by the Corporatists
Victor Grossman
A Big Rally and a Bavarian Vote
James Bovard
Groped at the Airport: Congress Must End TSA’s Sexual Assaults on Women
Jeff Roby
Florida After Hurricane Michael: the Sad State of the Unheeded Planner
Wim Laven
Intentional or Incompetence—Voter Suppression Where We Live
Bradley Kaye
The Policy of Policing
Wim Laven
The Catholic Church Fails Sexual Abuse Victims
Kevin Cashman
One Year After Hurricane Maria: Employment in Puerto Rico is Down by 26,000
Dr. Hakim Young
Nonviolent Afghans Bring a Breath of Fresh Air
Karl Grossman
Irving Like vs. Big Nuke
Dan Corjescu
The New Politics of Climate Change
John Carter
The Plight of the Pyrenees: the Abandoned Guard Dogs of the West
Ted Rall
Brett Kavanaugh and the Politics of Emotion-Shaming
Graham Peebles
Sharing is Key to a New Economic and Democratic Order
Ed Rampell
The Advocates
Louis Proyect
The Education Business
David Yearsley
Shock-and-Awe Inside Oracle Arena
FacebookTwitterGoogle+RedditEmail