Joel Kotkin: The capitalist elite undermines our economic security

 He means libertarians.

Here:

Free-market dogmatists have played a part in the deindustrialisation of the West as well. Consultants and investors pushed businesses to look offshore for virtually every critical production input. Between 2004 and 2017, the US share of world manufacturing shrank from 15 per cent to 10 per cent. Our reliance on Chinese inputs doubled. The trade deficit with China, according to the Economic Policy Institute, has cost as many as 3.7million American jobs since 2000. Overall, the US and the EU have seen their share of value-added manufacturing drop from 65 per cent in the 1960s to barely half that today.

Brendan O'Neill is worth reading because he knows about the clerisy, not to mention Luther

 Chappelle won’t be cancelled. He can’t be. ... He values the truth and just being funny more highly than the shrivelled respect you win when you succumb to the diktats of the clerisy.

More.

Joel Kotkin has come around, now calls it what it is: Global fascism

In 2018, Kotkin was still tip-toeing around the obvious, but not anymore:

Mussolini’s notion of fascism has become increasingly dominant in much of the world . . .

Mussolini, a one-time radical socialist, viewed himself as a “revolutionary” transforming society by turning the state into “the moving centre of economic life”. In Italy and, to a greater extent, Germany, fascism also brought with it, at least initially, an expanded highly populist welfare state much as we see today.

Mussolini’s idea of a an economy controlled from above, with generous benefits but dominated by large business interests, is gradually supplanting the old liberal capitalist model. ...

fascism — in its corporate sense — relies on concentrated economic power to achieve its essential and ideological goals. ...

China, in many aspects the model fascist state of our times, follows Il Duce’s model of cementing the corporate elite into the power structure. ...

But in the battle between the two emergent fascist systems, China possesses powerful advantages. Communist Party cadres at least offer more than a moralising agenda; they can point to the country’s massive reduction of extreme poverty and a huge growth in monthly wages, up almost five-fold since 2006. At a time when the middle class is shrinking in the West, China’s middle class increased enormously from 1980 to 2000, although its growth appears to have slowed in recent years.

Like Mussolini, who linked his regime to that of Ancient Rome, China’s rulers look to Han supremacy and the glories of China’s Imperial past. “The very purpose of the [Chinese Communist] Party in leading the people in revolution and development,” Xi Jinping told party cadres a decade ago, “is to make the people prosperous, the country strong, and [to] rejuvenate the Chinese nation.”

Kotkin recognizes at least that American right-wing libertarianism is part of the problem, not part of the solution:

the consolidation of oligarchic power is supported by massive lobbying operations and dispersals of cash, including to some Right-wing libertarians, who doggedly justify censorship and oligopoly on private property grounds.

Regrettably, however, Kotkin still does not connect this failure of the old liberal order in the West with the failure of the old moral order which gave it birth and on which it depended. This is because Kotkin still sees things in primarily materialistic terms.

Kotkin is oddly politically correct when he denounces possible recourse to nativism, which blinds him to the nativism which is at the heart of Chinese state capitalism and gives it much of its appeal and strength. He calls for "a re-awakening of the spirit of resistance to authority" in the West, not realizing that it was Protestantism which made that even possible in the first place.

The problem of the West is spiritual, and Catholicism will never be able to rise to the occasion of refounding it as long as globo-homo defines Rome. The whole idea is inimical to the notion of founding a nation "for our posterity".

Green New Deal in the hands of Democrats is a dagger aimed at the heart of the middle class

 Joel Kotkin here in The New York Post:

If these Democrats win both houses of Congress as well as the White House, things could get far worse for the already beleaguered middle class, which has been rocked by the pandemic, with an estimated 100,000 small firms going out of business. Particularly hard-hit by the recent urban unrest are inner city and minority businesses. ...

If the Democrats win on Election Day, the future for the middle class could be bleak. As a lifelong Democrat, this is not easy to write, but most of the party’s initiatives — such as the Green New Deal — are directly harmful to those in the middle and working classes, who’d be forced to face increased housing and energy prices and fewer upwardly mobile jobs in industries like manufacturing.

Like just about everyone else on the left, Joel Kotkin continues to twist himself in pretzels to avoid calling our system what it already is

State capitalism.

It is the socialism of the right, despite what names people may give it. The fascist model in which business and government cooperate now more, now less was not defeated in World War II. The superior American version simply defeated the German one, and eventually also the left's inherently weaker version in Russia.

It has triumphed globally, brought to the fore in America by the libertarian resurgence under Ronald Reagan, imitated by the jealous Euro project, and notably exported to China, where it was eagerly embraced as no threat to Marxism. To the genuine Marxist, remember, free-trade is welcome because it hastens the global revolution. Belt and Road participants, take note.

The experiential groundwork for global state capitalism was laid long ago by the King and Bank of England in their joint enterprise known as the Thirteen Colonies. Everyone imitates this now in principle if not always in particulars. But everywhere it flourishes it is facilitated by the same thing, the central banking systems which coordinate their activities through rules administered under Basel III. The contemporary exemplars of state capitalism fancy that they are substantively a world away from Hitler's Germany, because, well, the Jews. We don't kill Jews, insist these experts at mass abortion and Uyghur mass re-education. 

It's the historical resonances which bother the left in using the phrase, but the underlying facts aren't different in substance. Materialism today means not having to say you're sorry for treating people like depreciated or unappreciated assets. Older workers in the West are routinely tossed aside for being too costly. Potential younger competitors are hamstrung by a culture of costly credentialing prerequisites. When such people become worthless enough, it isn't unlikely that in some places they could stop being considered people altogether (typically where atheism reigns) so that they could be slaughtered wholesale with the same relative efficiency already applied to the unborn. The tech already exists to do this. The only question is when will the people exist who are possessed of enough nerve.   

Here's Kotkin on this so-called "new, innovative approach" which looks like nothing so much as the old Soviet Union, with its hostility centered on the middle class, its dreary blocks of drab apartment buildings, the dim pall of surveillance and conformity lurking everywhere, complete with its own privileged new class in service to the party .01 percent:

Oligarchal socialism allows for the current, ever-growing concentration of wealth and power in a few hands — notably tech and financial moguls — while seeking ways to ameliorate the reality of growing poverty, slowing social mobility and indebtedness. This will be achieved not by breaking up or targeting the oligarchs, which they would fight to the bitter end, but through the massive increase in state taxpayer support. ... [T]he tech oligarchy — the people who run the five most capitalized firms on Wall Street — have [sic] a far less egalitarian vision. ... [T]hey see government spending as a means of keeping the populist pitchforks away. ... Handouts, including housing subsidies, could guarantee for the next generation a future not of owned houses, but rented small, modest apartments. ...  They appeal to progressives by advocating politically correct views . . .. Faced with limited future prospects, more millennials already prefer socialism to capitalism and generally renounce constitutionally sanctioned free speech . . .. [I]ncreased income guarantees, nationalized health care, housing subsidies, rent control and free education could also help firms maintain a gig-oriented [slave] economy since these employers do not provide the basic benefits often offered by more traditional “evil” corporations . . ..  [T]he oligarchy, representing basically the top .01 percent of the population, are primarily interested not in lower taxes but in protecting their market shares and capital. ... The losers here will be our once-protean middle class. Unlike the owners of corporations in the past, oligarchs have no interest in their workers become homeowners or moving up the class ladder. Their agenda instead is forever-denser, super-expensive rental housing for their primarily young, and often short-term, employees. ... The tech moguls get to remain wealthy beyond the most extreme dreams of avarice, while their allies in progressive circles and the media, which they increasingly own, continue to hector everyone else about giving up their own aspirations. All the middle and upwardly mobile working class gets is the right to pay ever more taxes, while they watch many of their children devolve into serfs, dependent on alms and subsidies for their survival.

Home Prices Still Too High: Nationally 24% Pay More Than Half Their Income On Housing

Case Shiller Home Price Index @multpl.com

Joel Kotkin reflects on the still expensive housing market here:

Ownership levels continue to drop, most notably for minorities, particularly African Americans. Last year, according to the Harvard study, the number of renters in the U.S. rose by a million, accompanied by a net loss of 161,000 homeowners.

This is bad news not only for middle-income Americans but even more so for the poor and renters. The number of renters now paying upward of 50% of their income for housing has risen by 2.5 million since the recession and 6.7 million over the decade. Roughly one in four renters, notes Harvard, are now in this perilous situation. The number of poor renters is growing, but the supply of new affordable housing has dropped over the past year. ...

According to the Center for Housing Policy and National Housing Conference, 39% of working households in the Los Angeles metropolitan area spend more than half their income on housing, 35% in the San Francisco metro area and 31% in the New York area. All of these figures are much higher than the national rate of 24%, which itself is far from tolerable.

-------------------------------------------------

Kotkin nowhere mentions that currently expensive housing is explicit Federal Reserve policy. ZIRP and QE are specifically designed to reduce long term interest rates to make home mortgages affordable. Instead those policies have re-inflated housing prices to their historical highs before the bubble and reversed the downward trajectory of price resetting those prices were on.

In June 2013 dollars, the Case Shiller Home Price Index reached its low point after the bubble at 126.30 for the quarter ended March 31, 2012. That level hadn't been seen since June 1998. But from the long term perspective prices should have reset to 120 on the index or lower as they have in the past. This expectation holds even more considering the excesses of the bubble which needed to be wiped out, but haven't been.

The Fed has done nothing but interfere with the free market in housing, creating the bubble in the first place and preventing its deflation now. To fix the problem, the Fed needs at a minimum to focus solely on price stability by maintaining a strong dollar. Markets will take care of themselves after that.

Joel Kotkin Urges Republicans To Join The Class War

"It’s time for Republicans to break with the traditions of Goldwater, Reagan, and, particularly, Bush and shift to something more akin to the party’s roots in the mid-19th century. This party needs less preaching and libertarian manifestos that essentially defend plutocracy. Instead it’s time to embrace class warfare on today’s gentry, and embrace the aspirations of today’s middle-class. Honest Abe in 2016?"

Egging on the Republicans to embrace Marxist class categories and methods and pretending that's not an appeal to ideology, Joel Kotkin here thinks Republicans could win again if only they gave stuff to the yeoman class and took away stuff from the clerisy. You know, like his hero Pres. Abraham Lincoln did when he signed the Homestead Act in 1862, which gave away 160 acres out west to anyone who would improve the land, and when he signed the Emancipation Proclamation, which took away the property of slaveholders without compensation. Like all good dictators, Lincoln made notions of property and its value even more arbitrary than they had been before.

It is little appreciated how the Homestead Act basically destroyed the flexibility of the federal revenue system, causing the federal government to rely increasingly on tariffs and also excises which up until The War Between The States had fluctuated up and down as revenues from federal land sales did the same.

So Anderson and Martin, here, who emphasize the substitutability of tariff and land sales revenues:


"Coinciding with the rapid increase in land grants to homesteaders, railroads, and the states after 1862, the federal revenue derived from land sales fell rapidly as a proportion of total receipts. Further, the general decline in tariff rates that had occurred until the Civil War was reversed, and tariff rates began to rise rapidly. Import duty rates, which had reached their lowest level in the century in 1857, increased sharply during the Civil War and remained high for the remainder of the century (Baack and Ray 1983, p. 73). Tariffs continued to be the single most important source of federal revenue after the war ended."

So in an important sense, Lincoln and the Republicans are to blame not just for the development of Our Enemy, The State, they are also to blame for setting the untenable conditions to fund it as it henceforth and inevitably grew large. In the end, the price of Union and black emancipation would be universal bondage to Leviathan with the coming of the Income Tax in 1913.

Kotkin completely misses the significance of what's going on on the right. Conservatives in America are rediscovering the meaning of the constitution, and how people like Lincoln ruined it. Mitt Romney with his incessant talk of American supremacy in the world simply reminded them too much of him.

Kotkin's correct about one thing, though, that the socialism of Obama is misunderstood. But Kotkin doesn't call it the fascism that it is, because Kotkin himself actually advocates it himself, only that it's the good kind which helps grow the middle class.

From the comments section, Kotkin says as much:

"i am an old-style democrat who favors using government when necessary to create an ever-larger property owning class. neither party today has this as its main focus. instead both are neo-feudalist as I will explain in the coming months."

Old style democrat? You know, the FDR kind, which admired and imitated the strong men of Europe, who eventually plunged the world into a war far bloodier than, but no less reminiscent of, Lincoln's.

Conservatives want to get rid of the imperial presidency, not just get one friendly to its interests.

Joel Kotkin's "New Geography" isn't old enough.

Election 2012: It's The Yeomanry Vs. The Clerisy

Joel Kotkin's formulation of the class war, here, between

"people engaged in farming, fishing, forestry, transportation, manufacturing and construction"

and

"an ever-expanding class of minders — lawyers, teachers, university professors, the media and, most particularly, the relatively well paid legions of public sector workers — who inhabit Washington, academia, large non-profits and government centers across the country."

Romney Doesn't Oppose Obama's Financier Fascism, He's Part Of It

"[D]espite taking office in the midst of a massive financial meltdown, Obama’s administration has not prosecuted a single heavy-hitter among those responsible for the financial crisis. To the contrary, he’s staffed his team with big bankers and their allies. Under the Bush-Obama bailouts the big financial institutions have feasted like pigs at the trough, with the six largest banks borrowing almost a half trillion dollars from uncle Ben Bernanke’s printing press. In 2013 the top four banks controlled more than 40 percent of the credit markets in the top 10 states—up by 10 percentage points from 2009 and roughly twice their share in 2000. Meantime, small banks, usually the ones serving Main Street businesses, have taken the hit along with the rest of us with more than 300 folding since the passage of Dodd-Frank, the industry-approved bill to “reform” the industry. ...

"In a sane world, one would expect Republicans to run against this consolidation of power, that has taxpayers propping up banks that invest vast amounts in backing the campaigns of the lawmakers who levy those taxes. The party would appeal to grassroots capitalists, investors, small banks and their customers who feel excluded from the Washington-sanctioned insiders' game. The popular appeal is there. The Tea Party, of course, began as a response against TARP. ...

"Romney himself is so clueless as to be touting his strong fund-raising with big finance. His top contributors list reads something like a rogue’s gallery from the 2008 crash: Goldman Sachs, JPMorgan Chase, Morgan Stanley, Credit Suisse, Citicorp, and Barclays."

Read the whole thing from Joel Kotkin, here.

Obama's Gangster Auto Tsar Admires China, The Largest Expression of Crony Capitalism In History

As pointed out by Joel Kotkin for The Daily Beast, here, who refrains from using the still radioactive term "fascist" in lieu of which the euphemism "crony capitalism" will still have to do:

Obama’s financial tsar on the GM bailout, Steven Rattner, took to The New York Times to stress that Obamians see nothing systemically wrong with the banking system we have now, blaming the 2008 market meltdown on “old-fashioned poor management.” ... 

Rattner ... paid $6.2 million and accepted a two-year ban on associating with any investment adviser or broker-dealer to settle with the SEC over the agency’s claims that he had played a role in a pay-to-play scheme involving a $50,000 contribution to the now-jailed politician who controlled New York State’s $125 billion pension fund. He’s also expressed unlimited admiration for the Chinese economic system, the largest expression of crony capitalism in history. Expect Rattner to be on hand in September, when Democrats gather in Charlotte, the nation’s second-largest banking city, inside the Bank of America Stadium to formally nominate Obama for a second term.

Fertility In All Tiger Economies Has Fallen Below Replacement Rates

So says Joel Kotkin for Forbes here:

"All Tiger nations now suffer fertility rates roughly half the 2.1 children per household needed to replace the current population. By 2030 these countries could have fewer people under 15 than over 60."

The fault of prosperity, or at least the pursuit of it, at the expense of the old traditional, especially Confucian, ideals of family.