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

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 pillage. The 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 Fail, describing 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.