The American Conservative: “Extractive Elites” and “Macro-Corruption”

April 21st, 2012

It’s pretty amazing to read a cover story in, and by the publisher of, The American Conservative that could have run in The Nation, Mother Jones, or on Daily Kos — almost.

Certainly America’s top engineers and entrepreneurs have created many of the world’s most important technologies, sometimes becoming enormously wealthy in the process. But these economic successes are not typical nor have their benefits been widely distributed. Over the last 40 years, a large majority of American workers have seen their real incomes stagnate or decline.

Ordinary Americans who work hard and seek to earn an honest living for themselves and their families appear to be suffering the ill effects of exactly this same sort of elite-driven economic pillageThe roots of our national decline will be found at the very top of our society, among the One Percent, or more likely the 0.1 percent.

This is in The American Conservative!

Strangely disguised under the title China’s Rise, America’s Fall, Ron Unz riffs like so many of late on Daron Acemoglu and James A. Robinson’s new Why Nations Faildescribing America over recent decades as a country plagued by “extractive elites” and “macro-corruption.”

Macro-corruption is a great coinage. Former S&L enforcer Bill Black should adopt it in place of his perhaps more descriptive but not very catchy “control fraud.”

Unz (emphasis mine):

although American micro-corruption is rare, we seem to suffer from appalling levels of macro-corruption, situations in which our various ruling elites squander or misappropriate tens or even hundreds of billions of dollars of our national wealth, sometimes doing so just barely on one side of technical legality and sometimes on the other.

Sweden is among the cleanest societies in Europe, while Sicily is perhaps the most corrupt. But suppose a large clan of ruthless Sicilian Mafiosi moved to Sweden and somehow managed to gain control of its government. On a day-to-day basis, little would change, with Swedish traffic policemen and building inspectors performing their duties with the same sort of incorruptible efficiency as before, and I suspect that Sweden’s Transparency International rankings would scarcely decline. But meanwhile, a large fraction of Sweden’s accumulated national wealth might gradually be stolen and transferred to secret Cayman Islands bank accounts, or invested in Latin American drug cartels, and eventually the entire plundered economy would collapse.

Does this sound like the American financial industry to you?

But is Unz talking about the financial industry and its government (particularly Republican) toadies? Of course not. That would be admitting that he and his movement are largely at fault for the problems he’s describing.

When parasitic elites govern a society along “extractive” lines, a central feature is the massive upward flow of extracted wealth, regardless of any contrary laws or regulations. Certainly America has experienced an enormous growth of officially tolerated corruption as our political system has increasingly consolidated into a one-party state controlled by a unified media-plutocracy.

What’s amazing here is the two bolded passages. What in the heck does he mean by “regardless of any contrary laws or regulations”? Perhaps that the institutions responsible for enforcing and writing those laws and regulations are defunded, defanged, and co-opted by the extractive elite? Sound familiar?

And the final passage is just breathtaking. The financial industry, empowered and unleashed by that defanging (with American conservatives cheering and pushing every step of the way), has captured 20-40% of corporate profits over the last decade or so. But it’s the media that’s doing the extracting?

All I can say is they’re not very damned good at it. Wouldn’t you expect the extractive elite to successfully . . . extract a lot of money into offshore bank accounts? Exactly which industry is doing that?

Some might find it significant that the word “banks” never appears in the article.

I don’t need to detail all the other ironies that pervade this piece. (Notably: an excellent extended and off-topic rant against Obama’s continuation and expansion of Bush-era conservative, authoritarian military, intelligence, and surveillance policies, and their popular glorification in shows like 24: “Throughout all of modern history, I am not aware of a single even semi-civilized country that publicly celebrated the activities of its professional government torturers in the popular media.). They’re rife and manifest.

But I would highly recommend this piece to those seeking to understand and explicate the problems plaguing this country. “Extractive elites” and “macro-corruption” encapsulate it pretty perfectly. It’s also essential reading for those like me who can’t seem to look away from the decades-long train wreck of contorted, self-contradictory conservative “thinking.”

* Irresistible aside: I heard an NPR interview years back with a businessman from a South American country saying that his country is far more democratic than ours. In his country, anyone can bribe officials. In America, only the rich get to make bribes.

Hat tip: Beowulf

Cross-posted at Angry Bear.

  1. beowulf
    April 21st, 2012 at 12:00 | #1

    “How to Save the Global Economy: Raise the Minimum Wage. A Lot.
    BY JAMES K. GALBRAITH | JAN/FEB 2012
    Americans can’t spend, their government won’t spend, and the tax cuts of both George W. Bush and Barack Obama are set to expire soon… Everything is blocked up. Is there anything we can do that would make a difference? Yes. “Raise the U.S. minimum wage. By a lot — let’s say, to $12 an hour, from the current rate of $7.25. Ron Unz, publisher of the American Conservative, put this idea in my head, and the more I think about it, the better it seems. Unz was writing in the context of the politics of immigration…
    Unz argues that a high minimum wage would be a self-enforcing deterrent against abusive employers seeking cut-rate help. Jobs for the undocumented would dry up. Those who hold onto their jobs — the vast majority of low-wage workers and especially those with U.S. citizenship, English fluency, experience, and skills — would gain a big advantage… The plan isn’t just good for Republicans — it’s good for the economy.”

    http://www.foreignpolicy.com/articles/2012/01/03/7_raise_the_minimum_wage_a_lot

    Sort of ironic that the guy (Unz) who’s making (TAC magazine founder) Pat Buchanan’s “conservatism of the heart”* politically relevant is a Jewish guy who went to Harvard. :o)

    “a vision of a new conservatism of the heart rooted in old and unchanging principles and values learned long ago in homes, schools and churches — and grounded in he patriotism, the love of country, and the enduring ideas of our Founding Fathers. We entered the Primaries of 1996, to give voice to the voiceless: To the defenseless unborn — to the Forgotten Americans, left out and left behind in the raucous stampede toward a global economy — and a voice for those middle-class families, like the one I was raised in, for whom the American Dream has begun to vanish…
    We have forgotten that America is more than her Gross National Product. She is more than the world’s largest economy. She is more than the sum of all we buy and sell. She is our country, our home. We are not just “consumers.” We Americans are citizens of a Republic, sons and daughters of a great nation, brothers and sisters; and we have obligations and duties to one another.
    In this campaign I have been critical of the conduct of these transnational corporations that show no loyalty to their workers, nor allegiance to any country. I do so, because, no matter how rich and powerful they are, they do not represent what is right about American enterprise.”

    http://0171ea0.netsolhost.com/CultureWar/conservatismheart.htm

  2. Publius
    April 23rd, 2012 at 06:49 | #2

    The American Conservative has been criticizing the “Bush-era conservative, authoritarian military, intelligence and surveillance policies” practically since it’s been founded, largely on the grounds that they aren’t conservative. You’re right about the irony among most Republicans, that they’re deficit hawks until it comes to military spending, and for civil liberties until the Pentagon asks for more power, but not all conservatives, and certainly not that magazine, have bought into the hypocrisy.

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