In the next chapter we will examine what this meant for the rights of the common people.
How is the contemporary selfish class following this model? So far, although the wealthy tend to be born to privilege, their vast accumulations of wealth do not come from inheritance, but from taking advantage of their connections; they don't start with nothing, but they accumulate much more. Bill Gates used his mother's entrée into IBM (she had a high level position in the company) to gain his first DOS contract, and its exclusivity was the basis for his company becoming a software monopoly. George W. Bush is also a good example of how the selfish class promotes its own. His family was wealthy, had gained its riches from investment in the military-security-industrial complex over several generations, but George started in business by investing the remainder of the education trust fund he had inherited and funds he gathered through his personal and family contacts. He founded Arbusto Energy, an oil and gas exploration company in 1977, with a number of investors including his mother, a drugstore magnate, Lew Lehrman, who later ran for governor of New York, and a member of the Saudi Bin Laden family, close to the Bush family (ironic that?). Arbusto (shrub in Spanish) lost money. It was bailed out with a million dollar stake (the company was worth less than $400,000 at the time) put up by a family friend (Philip Uzielli), then merged in 1984 with Spectrum 7, another oil exploration company, and George became CEO. Spectrum lost another one and a half million dollars in 1985 and was bought out by Harken Oil and Gas for $2.2 million, with George coming along as a member of the board of directors. Other investors included a Palestinian, Ghaith R. Pheraon, who was later involved with the huge BCCI international banking scandal (Bank of International Credit and Commerce) which was found to be involved in money laundering, support of terrorism, arms trafficking and which somehow could not account for at least $13 billion of its depositors' money.
Harken, in turn lost money, even when George's father was President of the US. It landed an unlikely contract to drill for oil offshore of Bahrain, although it had never before drilled offshore, or operated outside the US. Meanwhile, George, using his clout as the son of a US president, assembled investors (close friends of his father's) to buy the Texas Rangers from a friend, borrowed half a million to finance his share, and then sold $848,000 worth of shares in Harken a week before the oil company announced a $23 million loss. He beat a charge of insider trading because he had sold out, at least so he claimed, to pay off a loan he had incurred in the Texas Ranger deal. In all these business ventures, in other words, George W did not become wealthy through great business acumen; he was continually being bailed out by family and friends and the influence they could bring to bear, but he did become wealthy, while others lost their shirts.
With the Texas Rangers deal we come to the intersection of sports, money and politics. Bush's role as general managing partner of the Rangers, his role in media relations and in securing a new ballpark for the Rangers gave him a positive public image throughout Texas, so much so that he was able to parley his role (and his family name) into a winning campaign for governor of Texas.
Meanwhile, George's father, George H.W. Bush, the former President, is a major partner in the Carlyle Group, a private investment corporation worth at least $13.5 billion, and one that has profited heavily from the war on terror that his son, the President, now leads. It has been remarked that if the estate tax is abolished, George W. will be a major beneficiary, because of the escalating value of his father's Carlyle Group shares.
Another example could be drawn from Vice President Dick Cheney, who became CEO of Halliburton, a defense-related company, after he served as congressman, then as Secretary of Defense under George H.W. Bush. Cheney resigned from Halliburton when he became Vice President, but he is now estimated to be worth between $30-100 million, mostly from his tenure with Halliburton, even though corporate insiders say his leadership there nearly drove the company into bankruptcy. No more: it has profited tremendously from the war in Iraq, gaining no-bid contracts of $7 billion and $5 billion in the last several years, despite continued charges of over-billing and fraud.
bAnother example of how politics and business intertwine to the advantage of the participants in the selfish class is the recent business deal of Tom Delay, former Republican Majority Leader in the House of Representatives, who has been accused many times of fundraising improprieties. After the Energy Bill of 2005 was closed to all amendments, when negotiations in conference between the House and Senate had been completed, it was discovered that a provision had been secretly added to fund subsidies worth $1.5 billion to oil companies. Most of the funding is to be managed by a consortium of oil companies headquartered in Delay's district, including Halliburton.
According to the provision, they will be paid $100 million simply to administer the fund, and members of the consortium will be eligible for the subsidies, in other words, they can grant the subsidies to themselves. Despite the protest of the Democrat's House Deputy Leader, the provision was included in the final bill and passed without much media attention. In other words, the US legislature is in the business of handing out money to its favorites, lots of money, and what's surprising is that hardly anyone even complained about it.
How do you get rich and join the selfish class? Become active in the Republican Party, make lots of connections with people like Tom Delay, and control a large corporation, preferably in oil, or in military services and military construction.
Of course, the selfish class needs protection from all those nasty bureaucrats who might want to regulate them, who might insist that unfettered competition needs to be protected, and that people and the environment should be protected as well. What a silly idea! But see here. In an unregulated market, when a large and a small corporation face each other in competition, it usually doesn't matter if the small corporation is more innovative, or more efficiently run. The larger corporation can prevail simply because of its superior capital. The movement to deregulate may initially have been promoted by Democrats like President Carter to increase economic efficiency, but after two decades of experience with it, it is now clear: deregulation has two main targets: one of those is small business, the other is labor. The environment, of course, is also a loser.
And what is one of the major thrusts of the radical conservatives: to reduce or eliminate regulations on business.There are many ways to do this. The FCC under Chairman Michael Powell was quite forthright in championing the reduction of barriers to concentration in the media industry, while the Anti-trust division of the Justice Department has become a pale imitation of its former self. Under Bush, Anti-trust worked out a settlement with Microsoft, rather than dismantling it, or demanding that it provide information to enable competition in the software industry. Controlling Microsoft's monopolistic tendencies has been left to the Europeans, who demand that it provide open source code. If the Antitrust Division had been controlled by the conservatives earlier, it is likely that AT&T would still own all the Baby Bell phone companies. Now here is an example of what would have been a major reduction in future wealth caused by lack of regulation; think of the tremendous expansion of business in telecommunications once AT&T was divested of its phone companies!
Deregulation also can be pursued by indirection, by suppressing scientific studies that argue in favor of regulation, as the EPA did with research on the effects of mercury, therefore writing less stringent pollution control rules, or by Bush appointing regulatory administrators who had been advocates of deregulation for the industries being regulated.
"Tort reform" is another tool in the radicals' toolkit: it protects corporations from citizen accountability. If class action lawsuits are limited or eliminated, and if damages are capped at a few hundred thousand dollars, then corporations that no longer have to fear regulators, won't have to worry about liability suits from citizens, either. Fines of $250,000 or $500,000 are no more than slaps on an insensitive wrist to a multi-billion dollar corporation. They can simply be absorbed, even budgeted for, as a necessary, if minor, cost of doing business. But that's the point. Congressional passage of the "reform" was viewed as a huge payoff to corporate interests in return for their political support.
The conservative re-making of the courts has a similar intent, especially the appointments of Justices like John Roberts and Samuel Alito, who subscribe to libertarian ideas similar to Justices Thomas and Scalia. If all property is protected from government by the legal philosophy that any "taking" must be compensated, then virtually all environmental, labor, and commercial regulation will prove unworkable.
All the legal and government apparatus for limiting the power of corporations to exploit the rest of us is being rapidly dismantled by advocates of the selfish class. But the government's apparatus for popular repression is being strengthened: witness the Bush administration's insistence that the detainees in Guantànamo and elsewhere should not be subject to court review, and that the President has the wartime power (in a "war" that they have declared could last for a generation) to declare anyone, even a citizen, an "illegal enemy combatant," who is denied virtually any legal rights. The administration also insists that there should be no limits on the means it uses to extract information from detainees, most recently pressuring Congress to prevent it from enacting limits on its rights to torture them, and then issuing a signing statement to the McCain-Feingold law, that outlaws such practices; the signing statement largely nullifies the law, at least as far as the President is concerned.
The news media have collaborated in limiting the sources of information available to the public, especially in keeping them corporate and government-friendly. It is no secret that Rupert Murdoch's News Corp has become a pliable arm of the government, and that other big media conglomerates have largely followed Fox News' lead, because they see not only political benefits in doing so--greater access to power and information about government--but corporate economic benefits, as well, such as government complaisance as they conglomerate and merge even further, and gain control of larger and larger swathes of the information business. An example of this, after the Telecommunications Act of 1996 enabled greater concentration of ownership of media outlets is Clear Channel Communications, which has swept up over 1200 radio stations across the nation. But even the relaxed limits of the act are not expansive enough for Rupert Murdoch, who has used his influence and access to gain permission to buy more TV stations, radio stations and newspapers, even if he needs special exceptions from the Act to do so.
(Note: You can view every article as one long page if you sign up as an Advocate Member, or higher).
