Louis Proyect: The Unrepentant Marxist

January 24, 2020

Isabel dos Santos and the African lumpen-bourgeoisie

Filed under: Africa,capitalist pig,Counterpunch — louisproyect @ 10:57 pm

Isabel Dos Santos, 46, with her Congolese husband Sindika Dokolo, 47, in Cannes in May 2014


Thirty years ago, I was part of a Tecnica delegation that visited the African National Congress headquarters in Lusaka, Zambia. We were there to discuss the feasibility of a technical aid project for the ANC and the frontline states with Thabo Mbeki, the future president of post-apartheid South Africa. Back then, the term frontline referred to a group of other sub-Saharan nations that were also fighting for liberation.

Chief among them was Angola that had defeated the Portuguese colonial army and gained independence in 1975. However, peace did not ensue. Three rival guerrilla armies began to fight for control over the newly liberated country. The international left identified with the Popular Movement for the Liberation of Angola (MPLA). Unfortunately, the MPLA had to contend with both the National Front for the Liberation of Angola (FNLA) and the National Union for the Total Independence of Angola (UNITA). Israel backed the FNLA, an alliance that most would view as unsavory. However, China also backed the FNLA, which only goes to show that Maoism had its own unsavory aspects. As for UNITA, it was wholly reliant on CIA support and guilty of the same kind of war crimes the Nicaraguan contras were carrying out.

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February 20, 2019

Guest rips Tucker Carlson a new asshole

Filed under: capitalist pig — louisproyect @ 8:53 pm

February 5, 2019

The dark night of the soulless bourgeoisie

Filed under: capitalist pig — louisproyect @ 8:10 pm

Henry Fuseli, The Nightmare, 1781

Hardly a week goes by without some billionaire sounding as if he was a French aristocrat whose name has been encoded into the scarf that Madame Defarge is knitting in Charles Dickens’s “A Tale of Two Cities”. It is as if the election of an Alexandria Ocasio-Cortez means that the guillotine blade is being sharpened just for them.

The first and most visible of these panic-stricken plutocrats was Howard Schultz who decided to run as an independent in 2020 because the Democrats were too far to the left. One of them is Elizabeth Warren who once asked him for a campaign contribution. He refused, telling MSNBC that “she believes in programs that will lead to a level of socialism in America.” Warren is on record as opposing socialism, whatever that means to her. Her preference is for a “capitalism with serious rules”. If you Google “Starbucks” and “false advertising”, you get 192,000 hits. Judges keep ruling in Schultz’s favor when civil suits are brought against his corporation. One of these judges, who cleared Starbucks of skimping on ingredients, also cleared the cops of using excessive violence against student protesters in 2011 at U. Cal, Berkeley. Imagine that. So the idea seems to be that it is not so much socialism he is worried about but an end to “capitalism with rules that favor the rich”, which has been its modus operandi for the past 500 years or so.

Michael Bloomberg, who has personal wealth in excess of 47 billion dollars (15 times that of Schultz), is also considering running for President in 2020 but as a Democrat, unlike Schultz. But like Schultz, he is kept up at night cowering under his blanket from the bogeyman Elizabeth Warren. With regard to her wealth tax, he told reporters: “We need a healthy economy, and we shouldn’t be embarrassed about our system. If you want to look at a system that’s non-capitalistic, just take a look at what was once, perhaps, the wealthiest country in the world, and today people are starving to death. It’s called Venezuela.”

I doubt that Bloomberg ever read Karl Marx but anybody who has concluded that there was socialism in Venezuela must have been reading Jacobin rather than V. 1 of Capital.

I worked on a project to automate the branch office of Salomon Brothers in London for Bloomberg back in 1975. When a co-worker learned that I was assigned to the project, she gave me a sour face. What’s wrong, I asked? She basically described the kind of person #MeToo would have protested back then if it had existed. On the trading floor at Salomon, there was a Latina secretary who used to deliver coffee to the traders. My co-worker, an African-American woman named Barrie, told me that as the secretary made her way across the floor,  he would yell out “Look at the tits on that broad” or words to that effect. Last September, the Atlantic reported on “‘I’d Do Her’: Mike Bloomberg and the Underbelly of #MeToo” that makes clear nothing has changed with him:

From 1996 to 1997, four women filed sexual-harassment or discrimination suits against Bloomberg the company. One of the suits included the following allegation: When Sekiko Sakai Garrison, a sales representative at the company, told Mike Bloomberg she was pregnant, he replied, “Kill it!” (Bloomberg went on, she alleged, to mutter, “Great, No. 16”—a reference, her complaint said, to the 16 women at the company who were then pregnant.) To these allegations, Garrison added another one: Even prior to her pregnancy, she claimed, Bloomberg had antagonized her by making disparaging comments about her appearance and sexual desirability. “What, is the guy dumb and blind?” he is alleged to have said upon seeing her wearing an engagement ring. “What the hell is he marrying you for?”

Moving right along, we get someone whose personal wealth is a paltry two billion dollars. That’s Howard Marks, the CEO of Oaktree Capital, a company that made billions investing in “distressed properties” a decade ago. What is that, you ask? That’s the foreclosed houses that Steve Mnuchin profited from as well.

Marks made the news recently for publishing a memo to his clients about the danger posed by “socialism”, which you can read here. It seems that he has had trouble sleeping at night after reading a number of articles covering the rising popularity of socialism. One of them was written by the New Yorker’s editor David Remnick, who was well-known for spending most of the 1980s calling for the overturn of Soviet Communism. Of course, the USSR was not “communist” or “socialist” but a transitional society that was midway between capitalism and socialism. Apparently, Remnick is okay with “democratic socialism” since it boils down to the kind of welfare state found in Scandinavia in the 1960s and continued until recently when the money began to run out. Marks cites this passage from Remnick’s article:

In 2016, the Institute of Politics, at Harvard’s Kennedy School, polled people between the ages of eighteen and twenty-nine, and discovered that support for capitalism was surprisingly low. Fifty-one per cent of the cohort rejected capitalism; thirty-three per cent supported socialism. A later edition of the survey found that fifty-one per cent were “fearful about the future,” while only about twenty per cent were hopeful.

Maybe that fifty-one per cent worried about the future should get into the distressed properties racket. It worked out well for Marks, after all. He describes the post-WWII reality that began to collapse under the neoliberalism promoted by Democrats and Republicans:

As I see it, for the 60 years immediately following World War II, much of the world enjoyed a rising tide of prosperity that lifted all boats.  That made nearly everyone economically content and thus happy with capitalism and free-market solutions.  Even though some people did better than others, most did quite well.  Living standards rose and the incidence of poverty declined.  Ronald Reagan and Margaret Thatcher celebrated the efficacy of free markets, and the world agreed.

Those expecting a utopian transformation from the billionaire will be sorely disappointed:

Capitalism is an imperfect economic system, because differential performance in the pursuit of economic success – as well as luck – results in there being (a) some people who are less successful as well as some who are more and (b) a few who are glaringly successful.  Obviously I’m someone who has profited from capitalism, so my views could be dismissed as hopelessly biased.

Yes, Mr. Marks, you are hopelessly biased. By the way, although with a Jewish background like the German revolutionary with a similar name, his parents raised him as a Christian Scientist, a faith they adopted in the 1930s.

In 2012, Marks moved into a 52-million dollar apartment in 740 Park Avenue, the most exclusive building in New York City. It is a sprawling two story affair with 30 rooms, including two libraries, eight bedrooms, 10 bathrooms, six terraces and a dining room. Not content with the place, he spent millions renovating it—thus creating a “living hell” for his fellow billionaires who lived beneath him as reported in Vanity Fair, a magazine that would disappear overnight if Warren’s wealth tax was ever passed.

The address 740 Park has, indeed, turned into a war zone for the .001 percent. The Tangs claim in the suit that they’ve been trapped in a world of deafening noise, irrepressible disruption, destruction to their own apartment, and great distress soon after Marks embarked on a massive renovation in 2012. Worse, perhaps, they feel their concerns have been ignored by Marks and the co-op board.

Though the building requires work take place between the hours of 8:30 A.M. and 5 P.M., and only between May and September, when many dwellers are presumably in Southampton, the suit alleges that Marks’s workers start as early as 6 A.M. and the project has gone on without interruption for four years, without regard to the time restrictions. “Miranda Tang [the wife of semiconductor magnate Hamburg Tang] has been abruptly awoken almost every morning before 9 a.m. by the sounds of heavy machinery, banging, crashing, hammering, and drilling, which shook her out of bed and prevented her from being able to rest and sleep peacefully in any bedroom,” the suit says. She has even tried going back to sleep in other bedrooms in her duplex, to no avail. The noise is just too loud.

Howard Marks’s apartment at 740 Park Avenue

But that’s not the fanciest pad in the building. That belongs to Stephen Schwarzman, the CEO of Blackstone whose personal wealth is $13.3 billion. He has 34 rooms on the top two floors in a penthouse apartment that used to belong to John D. Rockefeller Jr. Schwarzman, like the three other men above, was a Jew ethnically and from a middle-class family. He shared their ostentatiousness but to the point of abnormal psychology. This is not a tendency peculiar to my brethren. Just look at the life-style of John D. Rockefeller, who was the son of an impoverished snake oil medicine salesman in the 19th century. I guess it is a function of being nouveaux riche.

Stephen Schwarzman and his pal Donald Trump

Schwarzman is notorious for the birthday parties he throws for himself. His seventieth, celebrated two years ago this month, came on the heels of Donald Trump’s demagogic attacks on Wall Street in the prior year’s election. Schwarzman and Trump are good friends, rather unsurprisingly. Both are grifters with a huge appetite for self-aggrandizement. The NY Times reported on the party:

Partygoers feasted on short ribs, while two camels wandered along a stretch of sand and a gondolier propelled his craft across the pool. Guests were treated to a 12-minute fireworks display that could be seen across Lake Worth Lagoon. To top off the evening at what is just one of the multibillionaire’s many homes, Gwen Stefani sang “Happy Birthday to You” before taking a quick twirl with the birthday boy around a dance floor constructed inside a two-story tent where acrobats shimmied and jumped.

The cost? A person familiar with the planning who was not authorized by the host to speak on the record estimated it at between $7 million and $9 million.

The guests had cocktails in the entry hall before moving on to the dining area, where later they ate cake sculpted in the shape of a Chinese temple with a dragon curled around the edges of the roof, according to one guest. The day after the celebration, some 150 people attended a private lunch hosted by Mr. Schwarzman.

And what about the camels? Mr. Fulk estimated they cost $1,500 apiece. “We’ve had a few camels at parties, too,” he said with a laugh.

Many of the guests at Mr. Schwarzman’s party were affiliated with the new White House, among them Mr. Trump’s daughter and son-in-law, Ivanka Trump and Jared Kushner, and his cabinet picks Steve Mnuchin, Wilbur Ross and Elaine Chao, according to Bloomberg. The Schwarzmans sat together at their table with David Koch, the businessman and supporter of conservative causes, who sat to the left of Mr. Schwarzman’s wife, Christine Hearst Schwarzman. Ivanka Trump was seated to Mr. Schwarzman’s right.

On January 23rd, Schwarzman was interviewed by Maria Bartiromo on the Fox Business channel network. She asked him about the political environment. What did he think of “these new ideas and this new focus by younger generations of socialism? I mean, you’ve got Alexandria Ocasio-Cortez coming out, talking about a 70 percent tax rate which of course would be double where we are right now in terms of the highest earners. We know that the highest earners already pay 80 percent of the tax. But your reaction to some of this new focus that we’re seeing from the Democrats on socialism?”

Like all these other plutocrats, he said that “those kinds of economies” have not worked out well. “As you go further out, towards communism, as you move further left, that’s resulted in failing almost everywhere economically.”

You get a good idea of how Blackstone exploits “capitalism with rules that benefit the wealthy” from how it operated in Great Britain, taking advantage of the neoliberalism that prevailed under Conservative and New Labour alike.

In the late 1990s, “care homes” underwent privatization in England. These were basically old-age homes that had formerly been part of the National Health System but were eating a large part of a dwindling budget. As is commonly understood, most health care costs are associated with the elderly. The largest company trying to profit over the nursing home business was Southern Cross that had been formed in 1996 by one John Moreton, a man who had made a fortune in North Sea oil investments at a young age. Just the kind of background needed for caring for dementia patients.

Six years later Southern Cross was sold to Blackstone for £162 million. Blackstone then aggressively began acquiring other care home properties in order to corner the market, a typical move by private capital firms. When the financial crisis hit in 2009, England was affected. As the income of many families decreased sharply, the ability to put an elderly family member in a care home decreased accordingly. This meant that dwindling occupancy rates reduced the revenue stream. So, Blackstone decided to defer 30 percent of its rent on its nursing homes for three months to stay in business.

Corners were cut everywhere to keep Southern Cross profitable, particularly in the care for the elderly that was their objective. Surely, Schwarzman was anxious to keep the money flowing in. There were those birthday parties that had to be paid for.

In 2011, the Orchid View care home in Copthorne, West Sussex was the subject of an investigation after 19 elderly patients died as a likely result of neglect and ill-treatment. Specializing in care for dementia patients, institutionalized abuse developed in a perfect storm combining underfunding and the routine indifference to marginalized patients. The BBC reported on Orchid View in 2013, long after Blackstone had walked away from its asset-stripping operation:

Andrea Sutcliffe, the CQC’s chief inspector of adult social care, said she had ordered a “root-and-branch review” of the organisation’s actions in relation to Orchid View.

While summing up, Ms Schofield said she had found that medical documents for resident Jean Halfpenny, 77, were falsified and that she was given too much of the blood-thinning drug warfarin.

Home manager Meera Reed had earlier denied ordering staff to shred documents and filling in new forms to cover up the overdose.

Continuing, the coroner said that another resident was found naked and in pain with his catheter twisted, while a family member found staff eating toast and drinking tea with their feet up.

This fucking bum Stephen Schwarzman was one of the billionaires attending the Davos World Economic Forum this year. He addressed the oncoming revolution in artificial intelligence that will wipe out as much of 40 percent of jobs. His answer to this, as he told Maria Bartiromo, was to donate to MIT where advanced technology could help create jobs for those lucky enough to survive the cuts. The rest be damned.

Clearly, Schwarzman was aware of the growing anger directed against him all these other bastards. Bloomberg News, the company owned by Schwarzman’s fellow plutocrat, reported on the jubilant mood there, ten years after the Great Recession had supposedly given way to a “great economy” as Schwarzman’s pal Donald Trump would put it.

Billionaire success was difficult to envisage a decade ago, when the gathering was marked by fear, anger and bitterness.

“Everyone I spoke to says it’s the grimmest Davos they’ve ever been to,” academic Kenneth Rogoff said at the 2009 meeting. “The mood has been very depressed.”

However, there were dark clouds on the horizon. The article concluded on this note:

Even as the meeting’s reports and agendas have repeatedly flagged inequality as one of the chief risks to a stable society, the global economy’s bifurcation has only quickened.

“The financial crisis was the kind of event that shakes things out, but it didn’t happen 10 years ago,” said Anand Giridharadas, author of ‘Winner Takes All: The Elite Charade of Changing the World.’ “The same rigging that caused the crisis ensured the losses were socialized.”

For those with minimal or no assets, it’s been a more challenging decade. Wages have stagnated and while equity markets have risen, fewer U.S. adults are invested in the stock market than in 2009. Compensation for chief executive officers in America’s largest firms is now 312 times the annual average pay of the typical worker, compared with about 200 times in 2009, 58 times in 1989 and 20 times in 1965, according to a 2018 report by the Economic Policy Institute.

In the middle of the night, people like Schwarzman, Marks, Schultz and Bloomberg must wake up with their silk pajamas drenched in sweat. They must be aware of what is going on in France. The Yellow Vests are the result of their French counterparts pushing too far. As is generally the case under capitalism, a pre-revolutionary period is ushered in by the utter indifference to suffering by the ruling class. When told that the masses lacked bread, Marie Antoinette said “Let them eat cake”. When Wilbur Ross was told that government workers could not pay their rent during last month’s shutdown, he asked why they couldn’t take out a loan. Isn’t it time for Madame Defarge to take up knitting again?


December 25, 2018

How KPMG and McKinsey ripped off South Africa

Filed under: Africa,capitalist pig — louisproyect @ 7:59 pm

Within the den of corruption known as the African National Congress, there have been two enablers that are marquee names in the world of management consulting and auditing. The first is McKinsey & Company that was founded in 1926 and considered by Vault.com and Consulting.com as the most prestigious in the world. The founder James McKinsey was an accountant by trade who went on to teach at Columbia University. His major work was “Budgetary Control” that conceivably could have been used by the McKinsey consultants in South Africa as toilet paper as they were juggling the books to help Jacob Zuma rip off the nation’s largely Black working class.

McKinsey’s partner-in-crime was KPMG, which stands for Klynveld, Peat, Marwick and Goerdeler. It is one of the big four accounting firms that used to number five until Arthur Anderson was put out of business for juggling Enron’s books. Years ago I was offered a job in their software development group but I received a better offer from another crook: Goldman-Sachs. Like McKinsey, KPMG is the recipient of many awards, including being named best firm in 2017 by the Asia Tax jury in Singapore. In a September 17, 2015 “report on the KPMG website titled “Anti-Bribery and Corruption: Rising to the challenge in the age of globalization”, Roy Muller, the director of KPMG operations in South Africa, stated:

Companies need to take a risk-based approach to the ABC due diligence of vendors. Even where companies indicate that ABC risk is considered, there is often no audit trail or a very poor one to identify high-risk third parties and no clear ranking of them according to the level of risk. Knowing your supplier is often a big challenge in Africa. In certain African countries electronic records are not maintained or are not easily accessible necessitating physical verification of company records.

If KPMG was hired to help South Africa crack down on tax evaders, there should have been another firm to investigate them since most of the work revolved around helping Zuma and his ANC cronies avoid paying taxes. After receiving a lucrative contract, their watchdogs went to sleep. Once considered the nation’s pride, the tax collection agency was left a smoldering wreck.

Not satisfied with the fees it earned for helping Zuma carve out the tax agency’s innards, KPMG also provided audits to the various companies owned by the Gupta brothers who fled South Africa recently to avoid arrest. To give you a sense of how filthy this marquee accounting firm had become, it diverted millions of dollars from a dairy farm project under the auspices of the Department of Agriculture to the pockets of the Gupta family who spent it instead on wedding written off as a “business expense” vetted by KPMG’s auditor.

The wedding that KPMG kickbacks made possible

The South African Times reported on some of the costs in the 30 million Rand wedding (a 1000 Rands is equal to $68, the total spent on the wedding was $2 million):

Beverages seem to have racked up the most costs for South Africans‚ coming in at a staggering R473‚370.41 followed by other general groceries‚ some bought at Makro‚ which cost roughly R190‚000.

It seems that the main dishes the Guptas presented to their guests were vegetables‚ which cost R169‚652.

When it came to fun in the pool‚ four hours of pool noodle and water ball hiring costs totalled R6‚555.09.

The ultimate spoil for the bride and groom and their wedding guests‚ however‚ appears to have been the fireworks display coming in at a cool R310‚801.52.

Two million dollars on a wedding when the average yearly wage in South Africa is $10,800. Meanwhile, KPMG helped keep taxes low for the nouveaux riche who had little interest apparently on what it takes to live on that kind of wage.

Meanwhile, the pot keeps boiling over with KPMG criminality. Just two months ago it revealed that it was instrumental in the collapse of the VBS Bank in South Africa that got a clean bill of health from their auditors in 2017. An official from the nation’s central bank described what happened as “The Great Bank Heist”, with $137 million being siphoned out and into the pockets of various con artists including Sipho Malaba, KPMG’s auditor.

Let’s turn back to the McKinsey group and survey the damage they made in a country I and many on the left viewed as in the vanguard of revolutionary change in the 21st Century.

They were hired to provide management consulting services to Eskom, the state-owned power utility in 2015 worth a cool $700 million. Eskom, which was on the edge of insolvency, had a failing infrastructure including a boiler that blew up and threatened the national power grid.

As was the case with KPMG, the deal involved the Gupta brothers who had cultivated ties with Jacob Zuma, who was the country’s version of Robert Mugabe. This turned out to be an illegal no-bid contract that provided a hefty pay-out to one of the Gupta family’s henchmen. In keeping with corporate norms of “diversity”, McKinsey made sure to staff its Johannesburg office of 250 workers with 60 percent Black South Africans.

McKinsey understood that big bucks could be made in South Africa by selling its services to government agencies that were filled with opportunist ANC members looking for a fast buck. In fact, Eskom was not the first crooked deal that the firm made there.

In 2011, Transnet, the state-owned rail and port agency, was like Eskom looking to modernize. In lining up funding for such an effort, naturally much of the loot could be diverted into the pockets of crooked ANC officials.

One of them was the new head of Transnet, a guy named Brian Molefe, who had been running the country’s public pension fund beforehand. And guess what? Molefe was connected to the Guptas. McKinsey and Molefe decided to buy 1,064 new locomotives, which would be the biggest government purchase in South African history. The NY Times reported that the winning bid came from a Chinese SOE that paid more than $100 million to shell companies tied to a Gupta associate, Salim Essa. So considering the transaction as one made between two of the BRICS anti-imperialist stalwarts, who can complain?

Fresh from this very lucrative deal, Molefe took a new job running Transnet in 2015. McKinsey’s top man assigned to the Eskom account was “a popular partner, Vikas Sagar, a stylish, Porsche-driving fitness buff in his 40s, known for hugging colleagues when the spirit moved him and fiercely charting his own course.”

Meanwhile, McKinsey had a junior partner in the deal, an outfit called Trillian Management Consulting that was a subsidiary of Trillian Capital, rumored to be connected—once again—to the Guptas. Trillian, which was a split-off from Regiments, the aforementioned Gupta firm involved with buying locomotives for Eskom, refused to divulge its ownership to McKinsey. Showing a certain degree of uncertainty about their junior partner, the firm assigned someone to sit down at a computer and do some searching for who was in charge. They learned it was none other than Salim Essa, the Gupta operative. Instead of a clean break that might have jeopardized their deal, they no longer used Trillian as a subcontractor but as an independent partner. As if this was supposed to sanctify a deal that would have functioned as an episode on “The Sopranos”.

The deal fell through after only 8 months but with $100 million being paid out to the two consulting firms—Trillian landed 40 percent of the fees. In a country where the average wage is $10,000 the sight of a McKinsey partner driving to work each day in a Porsche did not sit very well.

Back in 1990, I went to Zambia with a group of Tecnica activists to meet with Thabo Mbeki who would become President succeeding Nelson Mandela in 1999. In the ANC’s exile camp in Lusaka, we had discussions with junior leaders, most of whom appeared to be Communist Party members. In a million years, I never would have dreamed that the ANC would end up as typical African strongmen robbing the country blind in alliances with Western corporations in the habit of describing themselves as dedicated to progress and social justice, just like the bastards at Goldman-Sachs.

In KPMG’s “Global Code of Conduct” handbook, they make it sound like they are Greenpeace or something:

  • We act as responsible corporate citizens, playing an active role in global initiatives relating to climate change, sustainability and international development.
  • We aspire to the ten principles of the UN Global Compact.
  • We encourage good corporate citizenship.
  • We enhance the role of the accounting profession and build trust in the global capital markets. We contribute to a better functioning market economy.
  • We manage our environmental impacts so as to limit them.
  • We work with other businesses, governments and charitable organizations to create stronger communities.

As for McKinsey, they publish a quarterly magazine that promotes the corporate party line. In the most recent issue, they have a focus on their penetration of Africa including an article titled “How to Win in Africa”, appropriate enough considering how South Africa’s poor ended up with the shitty end of the stick.

Structured as a panel discussion, Georges Desvaux, the McKinsey partner who was in charge of business in Africa and who continued to do business with Eskom even after the Gupta ties were revealed, mused on the possibilities. Unlike KPMG, McKinsey partners don’t waste time talking about serving the poor and protecting the environment. Desvaux simply looks at Africa as the next China, where capitalism can create wealth and happiness. He puts it this way:

You also have to look at it and say, this is a long-term play. This is a 20-, 30-years play. It’s the same as China was 30 years ago, India was 15 years ago. Africa is going to be the next pillar of growth because of demographics, because of the natural resources, because of urbanization. And so what you need to do is you need to build the resilience that enables you to manage the risks that are inherent to those three different types of countries that Acha was talking about in order to make sure you are able to go through and weather the storms at some point.

This is straight out of Thomas Friedman’s playbook and about as credible. Considering what McKinsey did in South Africa, the only storm worth talking about was the shit-storm that McKinsey and KPMG created that left millions worse off and the comprador bourgeoisie in control. This is how Africa has been ruled for over a century, so much so that Walter Rodney wrote a book about it titled “How Europe Underdeveloped Africa” that might be retitled at this point “How Europe and America Underdeveloped Africa”. (Read Rodney’s book here: http://abahlali.org/files/3295358-walter-rodney.pdf)



December 18, 2018

Goldman-Sachs and 1MDB: the discreet stench of the bourgeoisie

Filed under: capitalist pig,Goldman Sachs — louisproyect @ 5:26 pm

LLoyd Blankfein: laughing over ill-gotten gains

As a former employee of Goldman-Sachs, I have the dubious distinction of getting their alumni newsletter. Yesterday, it contained a farewell interview with Lloyd Blankfein filled with self-congratulations befitting questions like “What did you come to learn and appreciate about what it takes to be a great leader?”. Part of what made Goldman so “successful” for the past 150 years in the eyes of the departing helmsman was hiring people who embraced its core “values”. Such hires could be counted on to “go into philanthropy or government, which is attractive to people who want to work at an organization that can prepare them for such work later in life.”

As for government, we got a taste of that from Gary Cohn, who was president of Goldman from 2006-2017. During his time there, he helped the Greek government buy complex bond products that led to the terrible financial crisis. He was also identified in the Panama Papers as one of the plutocrats who concealed income in offshore banks to avoid paying taxes. It was this sort of CV that must have persuaded Trump to choose him as chief economic adviser.

Another Goldman alumni called upon to uphold the firm’s values in government was Steve Mnuchin who was their Chief Information Officer among other posts. Fortunately for me, I bailed out of information services before he became my boss. After leaving Goldman, he eventually took over a California bank that specialized in foreclosing on homes, including the one that belonged to a 103-year-old woman who accidentally allowed her insurance to lapse. Like Cohn, Mnuchin’s chief goal as Secretary of the Treasury was to cut taxes for the rich and regulations that might get in the way of corporate profits even if they turned the air and water filthy. Mnuchin is married to a b-movie actress named Louise Linton who is as grubby as him and every other Trump administration figure. Here they are holding up dollar bills fresh off the Mint presses.

Continuing with Blankfein’s interview, we learn that he is a big-time student of history who has interviewed two of his faves in Goldman HQ: Doris Kearns Goodwin and Ron Chernow. Kearns and Chernow are notorious for writing history that flatters American politicians for their centrist appetites. Goodwin, like her fellow Harvard professor Alan Dershowitz, has plagiarism on her record while Chernow wrote the biography of Alexander Hamilton that inspired the Broadway hip-hop musical that celebrated him as an “immigrant” when he was nothing but a colonizing settler.

Ironically, this obsequious interview appeared the same day as a N.Y. Times article headlined “1MDB Case in Malaysia Deepens Goldman’s Crisis”. It turns out that the firm was instrumental in stealing millions of dollars from the country’s treasury in order to spend on various luxury items. Najib Razak, the former Prime Minister, made Imelda Marcos look like an ascetic. The Malaysian cops seized 1,400 necklaces, 567 handbags, 423 watches, 2,200 rings, 1,600 brooches and 14 tiaras from his properties worth $273 million.

Timothy Leissner, who was Goldman’s top henchman in the grand larceny, was arrested on November 9th. Leissner said that his decision to conceal his actions from Goldman’s compliance department was “very much in line” with a wider culture at the firm. Working closely with Leissner, Malaysian financier Jho Low served as an intermediary on behalf of Goldman in its dealings with Malaysian officials and 1MDB. Like Razak, Low never saw a luxury item he could resist. According to the FBI, he spent more than a billion dollars on watches, jewelry and the like. Between October 2009 and June 2010 alone, he spent more than $85 million in Las Vegas casinos as well as “luxury yacht rental companies, business jet rental vendors (and on) a London interior decorator” according to CNN.

In a New Yorker article on “Billion Dollar Whale”, a new book about Jho Low, we discover how Goldman Sachs and other banks helped raise ten billion dollars for 1MDB, following which five billion dollars of the money disappeared into the pockets of Razak, Low and their cronies. This paragraph suggests that we are living in a period approximating Nero’s rule over the Roman Empire:

Five billion is a large sum, perhaps too much to easily dispense with in a short amount of time, but the book’s opening scene offers an idea of where it went. In November, 2012, the sweaty, awkward Low threw himself a thirty-first birthday party, in Las Vegas. The guests included the hip-hop producer Swizz Beatz, the actors Leonardo DiCaprio and Benicio del Toro, and many unnamed beautiful women, and all were chauffeured by limousine to a night club that had been transformed into a circus-party space, where Cristal flowed like water. There, more celebrities appeared, including Kim Kardashian and Kanye West, along with investment bankers who had worked with Low. Low was gifted three Ducati motorcycles and a two-and-a-half-million-dollar sports car. The high point came when Britney Spears jumped out of a giant birthday cake wearing a skimpy gold outfit. The whole thing is so tacky and over the top it almost seems made up.

You wonder where Leonardo DiCaprio, the staunch crusader against climate change, fits in? It turns out that Jho Low financed films with some of this loot, including “The Wolf of Wall Street”, the 2013 Martin Scorsese film that some critics viewed as a dark satire on Wall Street excess. It tells the story of Jordan Belfort, a stockbroker who started out selling penny stocks before he moved on to become a major deal-maker on Wall Street and a crook. In my CounterPunch review (https://www.counterpunch.org/2014/01/03/the-confidence-men/), I made the essential connection in light of the Blankfein/Leissner/Razak/Low criminal conspiracy:

Belfort started a “bucket shop” called Stratton Oakmont in the late 1980s that eventually turned into a billion-dollar operation that challenged blue chip firms like Goldman Sachs for market share. A bucket shop specializes in selling dubious penny stocks to working class people over the phone using high-pressure tactics with a high commission to the salesman. There is only a difference in quantity as opposed to quality between a Stratton Oakmont and a Goldman Sachs. The government tends to go after people like Jordan Belfort and Bernie Madoff rather than Lloyd Blankfein and Jamie Dimon because their crimes are illegal as opposed to legal. When Blankfein and Dimon were marketing collateralized mortgages, they were inflicting far more damage than a Jordan Belfort could dream of in his wildest imagination.

The only change I would make to this is in describing Blankfein as now involved in “illegal” activities. The stench arising from 1MDB is not likely to disappear very soon. It is a function of an Empire in decline, much like Nero’s Rome. Instead of gladiators, we have NFL games on Sunday. With Rome relying more and more on commodities extracted from colonies East and West by captive peoples, the inner fiber of Roman society began to rot like a house whose foundations had been weakened by years and years of termite infestation. Those who hope to reconstruct American democracy on a new social democratic footing without replacing that capitalist foundation are just conning themselves. We need to speak the truth about the situation we face, not sweep it under the rug.

September 27, 2018

Jacobin Accused of Reneging on Wage Deal in British Takeover of Tribune Magazine

Filed under: capitalist pig,Jacobin — louisproyect @ 1:30 am

Jacobin Publisher Bhaskar Sunkara is being accused of reneging on a wage deal in his takeover of the British publication the Tribune. (CSPAN)

Payday Report
by Mike Elk

In his bid to take over the historic British left-wing magazine, The Tribune, Jacobin publisher Bhaskar Sunkara is being accused of reneging on wage deal by employees of the paper, who kept the publication alive during struggling times. Tribune was once the home of such greats as George Orwell and has since become the leading publication associated with the influential Momentum faction within the Labor Party.

The purchase of the paper seemed like an ideal takeover for Sunkara linking his viral socialist publication in America with the struggling legacy British paper.

This past weekend, Sunkara had a high-profile launch event attended by influential members of the Labor Party, including British member of Parliament Jon Trickett and Len McCluskey, General Secretary of 1.2 million member Unite the Union, the largest union in the UK. The Liverpool featured the French socialist leader Juan-Luc Melenchon as well as Julia Salazar, who despite falsely portraying herself as a working-class immigrant from Colombia, was successful in her bid to be the Democratic nominee for an influential State Senate seat based in Brooklyn. 

The event received much fanfare, however underneath the takeover of the storied British publication by the American publisher, media workers activists say that he’s done it by exploiting those, who produce content for socialist publications.

Workers say that Sunkara promised that if workers took a settlement of only 70% of the back wages that they were owed that he would bring them back as staffers after taking over the publication. However, Sunkara in a statement to Payday confirmed that he would not bring the staffers back.

The workers in a series of open letters have accused Sunkara of lying to them and simply taking over the publication to expand Jacobin’s content reach into European markets under the Tribune’s prestigious name.

“In the capitalist world someone who buys an ailing company and dumps its committed workers is known as an asset-stripper or robber baron, but at least they don’t claim to be socialists,” said former Tribune employee Ian Hernon.  

The dispute between the British magazine’s staff and its new publisher Bhaskar Sunkara, the 29-year-old son of a well-to-do family from the elite New York City suburbs of Westchester County, raises vital questions about how leftists publications treat the workers they employ.

The brash 29-year-old Bhaskar Sunkara, the founder and publisher of the Brooklyn based socialist magazine Jacobin, has proven to be one of the most controversial figures in the left press: known for increasing the reach of socialist writing while engaging in labor practices far less than socialist.

At a time when many speculated that print was dead, Sunkara built a socialist publication founded in 2011 that proudly boasts of publishing over a thousand articles a year, a print subscription of 30,000 and over one million page views a month online. In addition, the publication boasts of a specialized Jacobin book published by Verso press that has produced a dozen books, a separate academic journal “Catalyst: A Journal of Theory and Strategy of Strategy” launched last year, and dozens of Jacobin reading groups throughout the country that help the publication raise money.

However, Sunkara, has been accused of building his empire by underpaying his writers with many making on average $50-$100 a story.

For years, Sunkara and his allies have claimed that the socialist publication lacked the resources to pay its writers.

However, the purchase of the 80-year-old legacy British publication from the British football club Blackpool raised questions about what exactly Sunkara did with the money he saved by underpaying his writers at the Brooklyn-based Jacobin Magazine.

In the last year, the Tribune struggled with financial issues and discontinued print editions in January. In the interim period, a skeleton crew of writers and editors struggled to keep the publication afloat as a strictly online publication as they shopped for buyers of the storied publication. As part of his proposed takeover of the publication, Sunkara promised to pay the writers only 70% of the back wages they were owed and give them their jobs when they were returned.

Now, writers say that Sunkara has reneged on his promise to pay their workers their wages owed for the years they spent keeping the publication alive.

“All the pious, pseudo-academic waffle in the world doesn’t really amount to a hill of beans. Our actions are what count. How we treat others is what matters”wrote George Orsby in a letter protesting the move.

Reporters told Sunkara that they were outraged that he would renege on their deal and dismiss the workers from the publication. In an email responding to the disgruntled former staff, Sunkara and newly-appointed Tribune editor Ronan Burtenshaw, disputed the contributions of the editor who kept the publication alive during its financial stresses.

“While we appreciate all of those who have contributed to Tribune over many years, the claim in this instance that their stewardship of the project in the last three years ‘made it possible’ for Jacobin to take over the magazine is entirely false,” Burtenshaw told Payday Report in a statement.

However, the employees recently disposed of by Sunkara after they agreed to take a cut in back wages owed to them, have less than kind words to say about the jet-set Socialist publisher.

“You said you tried not to become the sort of editor/proprietor you despised. My advice to you is: try harder” wrote former Tribune employee Ian Hernon.

(Full Disclosure: Payday pays all of its part-time employees $32 an hour. Donate to help us pay them a fair wage

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March 19, 2018

The political economy of a bridge collapse

Filed under: Academia,capitalist pig,corruption,disaster — louisproyect @ 8:11 pm

Like many urban-based universities, Miami’s Florida International University had a tendency to expand. With more than 50,000 enrolled undergraduate students—many of whom are Cuban-American—it is the fourth largest in the USA. In recent years, expansion took place geographically as well. After more than 4,000 students found housing on the other side of an 7-lane highway to the north of the main campus, the school decided to build a bridge across it. Since the highway was a major artery in Miami, the school decided to use Accelerated Bridge Construction (ABC) that avoided the detours that would have blocked the flow of the city’s commercial lifeblood. In ABC, the first step is to build the bridge on a remote construction site and then transport it to the destination where it will be installed in a day or two at most.

Here is the breathless come-on to investors about the benefits the bridge will bring:

Here is the celebratory inauguration of the installed bridge on March 10th:

And here is its collapse on March 15th that left 6 people in the cars beneath the 950 tons of concrete dead:

As it happens, FIU was not only enthusiastic about this particular application of Accelerated Bridge Construction but also about ABC in general, so much so that it created a department devoted to the technology (https://abc-utc.fiu.edu/) in 2010 missioned to “reduce the societal costs of bridge construction by reducing the duration of work zones, focusing special attention on preservation, service life, construction costs, education of the profession, and development of a next-generation workforce fully equipped with ABC knowledge.”

Two days before it collapsed, the lead engineer with the Figg Bridge Group, one of the two principal construction companies on the project left a voice mail indicating that he saw a crack in the bridge with an employee of the Florida Department of Transportation, who was out of the office  and did not hear the voice mail until after the bridge had collapsed. It is not clear that anything would have been done had he been in the office since the voice mail did not sound a particularly urgent note.

While the Florida Department of Transportation was out of the loop, FIU itself was not. At a meeting at 9am on March 15th between Figg employees, including the lead engineer, and school administrators, they were told that “that there were no safety concerns and the crack did not compromise the structural integrity of the bridge.” A couple of hours later the bridge would come crashing down.

This was not the first time Figg had supervised the construction of a collapsing bridge. In 2012, there was an accident that fortunately did not involve motorists or pedestrians beneath even though four workers suffered minor injuries. The company paid a miniscule fine and moved on.

Required by state law to undergo an independent review of the project, Figg selected the Louis Berger Group, an engineering firm that lacked pre-qualification credentials from the Florida Department of Transportation. A November 5th 2010 NY Times article by James Risen, however, suggested that this firm was especially pre-qualified to scam the people that hired it:

A New Jersey-based construction and engineering company has been hit with the largest fines ever imposed on a contractor working in the war zones of Iraq and Afghanistan, after a whistle-blower revealed that the company had been overbilling the government.

The company, the Louis Berger Group, based in Morristown, N.J., will pay $18.7 million in criminal penalties and $50.6 million in civil penalties for overbilling the United States Agency for International Development for work in Afghanistan, Iraq and Sudan. As part of the civil agreement, the company will pay $14.2 million of the civil penalty in the next 30 days and the balance over the next four years.

Figg’s partner on the project was Munilla Construction Management, a firm whose vice-president Pedro Munilla is a former attorney who was disbarred in 2001 for violating trust accounts, which conceivably might have meant conning his clients in the same way the Louis Berger Group conned tax-payers (not to say that the invasion of Iraq and Afghanistan was not a con job to begin with.)

Pedro Munilla is a typical construction company wheeler-and-dealer. Last year he met with a a Chinese investor looking for U.S. acquisitions. Guess who was advising the investor: Paul Manafort. It’s a small world when corruption is involved. Munilla runs the firm with his four brothers who as might be expected were enthusiastic about Donald Trump.  Representing the brothers, Pedro Munilla had a meeting last June with Vice President Mike Pence to review the administration’s Cuba policies. The five brothers have ponied up more than $100,000 to the anti-Castro U.S.-Cuba Democracy Political Action Committee, whose chief Mauricio Claver-Carone blogs at Huffington Post for what that’s worth.

The Munillas have also contributed heavily to Republican Party politicians both in Florida and in Congress. This kind of influence-peddling must have opened doors for a a lucrative $63.5 million contract from the Defense Department in 2016 to build a school on the U.S.-controlled Guantánamo Naval Base in eastern Cuba.

Locally, their payoffs to politicians has been worth it as well. In 2012 Miami-Dade Commissioner Bruno Barreiro voted to award a $25 million contract to Munilla for a test track for Metrorail cars while renting office space from the firm’s owners, county records show. Four of the brothers contributed the maximum campaign donation of $500 each to Barreiro, who was won his commission seat for a fifth time.

All of the brothers are FIU graduates so everything came together from a military-industrial-academic complex standpoint.

The Miami Herald, which has provided outstanding reporting on the bridge collapse, ran down the Munilla brothers’ record, which is as shoddy as Pedro Munilla’s legal career:

MCM construction sites, meanwhile, have been inspected eight times by the federal government since 2013 and fined on four occasions for violations worth more than $50,000. The company has also faced a slew of standard negligence and personal liability cases — typical in the industry. A contractual dispute with a subcontractor that walked off the job resulted in a $143,000 judgment against MCM; the subcontractor cited safety issues with the project, a $13.5 million bridge reconstructing project on Red Road.

Court documents from the lawsuit show that Southeastern Engineering Contractors left the job, citing structural problems and “arguable collapse” at the worksite because of the “failure of temporary sheet piles on the south bend of the site.” Attempts to reach attorneys representing both sides in that case were unsuccessful, as were efforts to reach principal Pedro Munilla by cellphone.

This entire incident manages to touch all bases of the rotting capitalist system in the USA, both economically and politically.

To start with, what kind of university establishes a department with a single focus on Accelerated Bridge Construction? Isn’t a university supposed to provide general engineering courses that prepare a student for a career? The department chair is Atorod Azizinamini, who was honored by the Obama White House as a Champion of Change in 2015. Given the need to construct new bridges across the USA using a time-saving technology, including the replacement of the Tappan Zee bridge recently, you can understand why the big bourgeoisie would be thrilled by his innovation even if it just killed six people “accidentally”. After all, that’s the price of progress. Btw, remind me to not use the NY State Thruway the next time I go up to the Catskills since it crosses the Tappan Zee.

It also illustrates how influence-peddling can undermine the economic fabric of capitalist society itself even if benefits a particular corporation. Hasn’t this been the Achilles Heel of capitalism all along? Despite the libertarian, free market precepts shared by Republicans and Democrats alike (except for an outlier like Bernie Sanders), everybody knows that politicians are bought and sold. In a review of the Democrats who voted for a relaxation of the Dodd-Frank rules, it turned out that According to the Financial Times, the 12 Democrats behind the Crapo bill (aptly named after Mike Crapo, the Republican Senator who introduced it) receive a substantial percentage of their campaign donations from banks with just under $50 billion in assets—those, in other words, who will benefit from this deregulation.

Finally, it demonstrates that profits come before people. When shady construction companies collaborate with a university that serves as a vocational school for the technology they are utilizing and ignore obvious signs that peoples’ lives are endangered, that’s about as clear a sign as you will get about the decadence of this crumbling system.

Update from a Florida comrade:

From a union worker, explaining how “right to work” results in incompetent workmanship; in the recent tragic case in Florida, it got people killed:

For 30 plus years. I worked as a Concrete Form Carpenter. The media keeps saying they were doing a stress test when the bridge went down . The bridge deck was a cable stay deck instead of using Rebar, they used cables. So after the concrete is poured the cables are pulled tight. So these Idiots waited till the concrete was rock hard. When they pulled the cables they busted through the bottom deck. So down she goes.

The cables should been tightened before the rock turned hard but when the concrete was wet right after it was poured. I have worked in Florida, the companies hire anyone to work construction . The super down to the laborer. Unskilled people doing skilled labor. This is a right to work state.

Union Busting. Florida is a right to work state. No training. Crane Operators are not required have proof of any experience. It is a mess here. That is why I moved back to NY.

I have done bridge decks in the past. In Connecticut and New York state. I have never heard of a stress test. The media should inform them selves before issuing statements like that. They fucked up the cables should have been tightened before the concrete set up. When it is wet, a subcontractor should have been on site right after the pour and pulled the cables.

Before every concrete pour, the concrete is tested for water content and temp is taken. And core samples are taken to a lab. Were they are put in a press to test for strength. These idiots should have known better but here in Florida it is a right to work state. No Unions so the work force is unskilled. The contractors will hire anyone with a pulse.

I was trained by The United Brotherhood of Carpenters. Florida is a right to work state. No Unions, zero trained workforce. Idiots running these job sites all to save a dollar.

October 2, 2017

Tasteless publishing magnate S.I. Newhouse Jr. dead at 89

Filed under: capitalist pig,journalism — louisproyect @ 2:52 pm

S.I.. Newhouse

As might be expected, the NY Times obituary was respectful toward a member of their own class but you can get an idea of how awful this millionaire’s son was from a few excerpts:

Newhouse magazines were criticized for exalting the rich and famous through articles that gave their personal foibles and professional exploits equal importance. But as circulation and advertising revenues at his periodicals soared, other publishers took up the glitz-and-scandal approach to journalism. By the end of the 20th century, even the most serious newspapers and magazines offered profiles of entertainers, businesspeople, artists and politicians that balanced weighty accomplishment with juicy gossip.

Mr. Newhouse owned a modern art collection that at one time was valued at more than $100 million. He and his second wife, Victoria, gave lavish parties at their Manhattan townhouse. And their dog was feted at an annual birthday bash at which Evian water was served to canine guests while their owners enjoyed caviar.

His buying spree reached its apex in 1985 with his acquisition of The New Yorker, one of the country’s most intellectually rich general-interest magazines. Two years later, he replaced its legendary, septuagenarian editor, William Shawn, causing an outcry among the staff.

Although Mr. Shawn’s successor, Robert Gottlieb, was a highly respected book editor, the move added to Mr. Newhouse’s notoriety for firing even the most pre-eminent editors. In 1971, he dismissed Ms. Vreeland as editor of Vogue. Her replacement, Grace Mirabella, was informed of her own firing in 1988 when the gossip columnist Liz Smith announced it on a New York television newscast.

“The way it was handled was graceless — without making a pun,” Mr. Newhouse was quoted as saying by one of his biographers, Thomas Maier, in a 1995 article in The Quill. “The P.R. of it got all bitched up.”

But Mr. Newhouse was not any better at handling the dismissal of Mr. Gottlieb from The New Yorker in 1992. Mr. Gottlieb, who was traveling in Japan, found out he had lost his job when he was awakened in the middle of the night by a call from a reporter asking for comment on his firing. Mr. Gottlieb, like other former Newhouse editors, readily acknowledged that he had received a generous severance package.


Four years ago I wrote about the decline of fact-checking at The New Yorker, as well as its overall decline under Newhouse’s ownership. This section is worth reposting:

The original editor was one Harold Ross who founded the magazine in 1925 with financial backing from Raoul Fleischmann, heir to the margarine manufacturer’s CEO. In the 1920s Ross was a member in good standing of the Algonquin Round Table, a sort of American equivalent of the Bloomsbury Group, that used to meet regularly at the Algonquin Hotel dining room in New Yorker as a salon devoted to the discussion of politics and culture—something like the Marxism list. It included a wide variety of talents from Harpo Marx (I imagine he was out of character on such occasions) to the acerbic Dorothy Parker. Harpo’s brother Groucho once described them as a group where “The price of admission is a serpent’s tongue and a half-concealed stiletto.” Of course, this point was somewhat moot since Groucho once said that he would never join a club low enough to admit him as a member.

Ross was succeeded by Shawn in 1951 and probably had more of a political edge than the founder.

After buying the magazine in 1985, media mogul Si Newhouse Jr. decided to replace Shawn with Robert Gottlieb two years later, a move that precipitated a protest letter by 154 contributors to the magazine. A NY Times article suggested what might have caused the eruption:

Mr. Gottlieb’s editorial stamp is also apparent in his passion for kitsch, exemplified by the garish statues of Elvis Presley and the Lone Ranger among the knickknacks on his desk. But few longtime New Yorker staff members seem to share that taste, which probably accounts for their general annoyance with a recent article about a convention of Scottish terrier fanciers. The piece was written by Jane and Michael Stern, who wrote a book for Mr. Gottlieb on Elvis Presley.

In any case, Gottlieb’s stay was a short one. In 1992 Newhouse put Tina Brown, the British editor of “Vanity Fair” (another Condé Nast property), in charge. It was widely understood at the time that Brown, now the editor of the Newsweek/Daily Beast atrocity, would reshape the New Yorker along the lines of “Vanity Fair”, a temple of vacuous celebrity worship. Wikipedia reports that two months after the first Gulf War started, she removed a picture of the blonde Marla Maples (Mrs. Donald Trump) from the cover and replaced it with a photograph of Cher. She told the Washington Post: “In light of the gulf crisis, we thought a brunette was more appropriate.”

In 1998 Brown moved on to a new job at the Walt Disney Corporation. Newhouse replaced her with Sovietologist David Remnick, who is still the editor. With no apparent appetite for kitsch or celebrities, Remnick does seem to have an unquenchable appetite for neoliberalism and bellicose foreign policy initiatives.

One of Remnick’s early hires was Jeffrey Goldberg, the Zionist booster of George W. Bush’s invasion of Iraq. Alexander Cockburn did not mince words back in 2003 when he called attention to Counterpunch readers that Goldberg had written a New Yorker article tying al-Qaeda to Saddam Hussein.

At the core of his rambling, 16,000-word piece was an interview in the Kurdish-held Iraqi town of Sulaimaniya with Mohammed Mansour Shahab, who offered the eager Goldberg a wealth of detail about his activities as a link between Osama bin Laden and the Iraqis, shuttling arms and other equipment.

The piece was gratefully seized upon by the Administration as proof of The Link. The coup de gráce to Goldberg’s credibility fell on February 9 of this year in the London Observer, administered by Jason Burke, its chief reporter. Burke visited the same prison in Sulaimaniya, talked to Shahab and established beyond doubt that Goldberg’s great source is a clumsy liar, not even knowing the physical appearance of Kandahar, whither he had claimed to have journeyed to deal with bin Laden; and confecting his fantasies in the hope of a shorter prison sentence.

Given Goldberg’s talent for the fabulous, and Remnick’s role in vetting his garbage, is it any wonder that Jared Diamond falsely accuses Samuel Wemp of murder and that Jon Lee Anderson is caught with his pants down reporting on Venezuela?

I’ve had my own complaints about the New Yorker in recent years. I found Malcolm Gladwell tendentious on social networking and was appalled by Jill Lepore’s pissing on Howard Zinn’s grave.

Finally, although I have serious problems with the Nation Magazine, I am glad they gave Daniel Lazare a platform from which he could expound on the New Yorker’s perfidy at length. Written in 2003 (The New Yorker Goes to War) and inspired like Cockburn’s piece by the magazine’s support for Dubya’s war, the article went straight for the jugular:

The New Yorker has not been the only publication to fall into line behind the Bush Administration’s war drive, but for a number of reasons its performance seems especially disappointing. One reason has to do with the magazine’s track record. One doesn’t have to be a William Shawn devotee to agree that the magazine has published some astonishing journalism over the years–Hannah Arendt’s “Eichmann in Jerusalem,” James Baldwin’s “Letter from a Region of My Mind,” Rachel Carson’s “Silent Spring,” Jonathan Schell’s pieces on Vietnam and Pauline Kael’s wonderful demolition job on Claude Lanzmann’s Shoah, to name just a few. During the Vietnam War, it was one of the few mainstream publications to try to unmask the sordid reality behind the brass’s regular 5 o’clock press briefings. And if it published too many long and hyperfactual stories in the 1980s about wheat or geology, at least it preferred being trivial and obscure to the glories of being a team player in Washington, which is a moral stance of a sort.

Though its style may have been genteel, The New Yorker succeeded in challenging middle-class sensibilities more often than any number of scruffier publications. Another reason to mourn the magazine’s lack of resistance is that it represents an opportunity lost. Just as the magazine helped middle-class opinion to coalesce against US intervention in Vietnam, it might well have served a similar function today by clarifying what is at stake in the Middle East. Rather than unveil the reality behind a spurious War on Terrorism, though, The New Yorker helped obscure it by painting Bush’s crusade as a natural and inevitable response to the World Trade Center/Pentagon attack and, as a consequence, useless to oppose. Instead of encouraging opposition, it helped defuse it. From shocking the bourgeoisie, it has moved on to placating it at a time when it has rarely been more dangerous and bellicose.

How does a magazine bring itself to such a pass? The process probably began when Tina Brown took over in 1992. Politically, Brown wasn’t left wing or right wing so much as no wing. She fawned over Ronald and Nancy Reagan in Vanity Fair and then, a dozen years later, fawned over Bill Clinton in The New Yorker (“his height, his sleekness, his newly cropped, iron-filing hair, and the intensity of his blue eyes…”). While publishing the occasional exposé, such as Mark Danner’s memorable “Massacre at El Mozote,” she was more concerned with putting the magazine in the swim. David Remnick, who succeeded her in 1998, is a different case. Where Brown is catty and mischievous, his style is earnest and respectable. Although a talented reporter and a graceful writer, he lacks Brown’s irreverent streak. (One can hardly imagine him writing a first-person account of dancing topless in New Jersey, or whatever the male equivalent might be, as Brown famously did at the beginning of her career.) Remnick’s 1993 book, Lenin’s Tomb: The Last Days of the Soviet Empire, dutifully followed the Washington line in reducing a complex historical event to a simple-minded melodrama about noble dissidents versus evil Communist apparatchiki. Under his leadership, The New Yorker has never seemed more like a tame, middle-of-the-road news magazine with cartoons, which may explain why its political writers, people like Nicholas Lemann, Jeffrey Goldberg and Remnick himself, have never enjoyed more airtime on shows like Charlie Rose. In traveling from irreverence to reverence, it helps to have someone in charge with a heat-seeking missile’s ability to home in on the proper establishment position at any given moment. But it also helps to have someone who knows when to ask the tough questions and when to turn them off.

You are strongly encouraged to read Lazare’s entire article here.

February 14, 2017

Do workers admire and seek to emulate the superrich?

Filed under: capitalist pig — louisproyect @ 7:49 pm

On November 10, 2016, an article titled “What So Many People Don’t Get About the U.S. Working Class” appeared in the Harvard Business Review. The author is Joan C. Williams, the Distinguished Professor of Law and Founding Director of the Center of WorkLife Law at the University of California, Hastings College of the Law, who has a new book coming out on “The White Working Class” that presumably is a full-length treatment of the arguments found in the article. They can be boiled down to the claim that “the white working class (WWC) resents professionals but admires the rich.”

It rests mostly on her personal experience of having a father-in-law who was “a blue-collar white man who thought the union was a bunch of jokers who took your money and never gave you anything in return.” He rose from poverty to become an inspector in a factory that made machines that measure humidity levels in museums, read the Wall Street Journal and was a registered Republican. Apparently, he is the prototypical Trump voter in Williams’s eyes.

With respect to white workers resenting professionals, she cites Barbara Ehrenreich who referred to her blue-collar father as not being able “to say the word doctor without the virtual prefix quack.” Furthermore, he believed that “Lawyers were shysters…and professors were without exception phonies.” Perhaps Ehrenreich’s father was not the most representative sample. He was a copper miner but went to the Montana State School of Mines and then to Carnegie Mellon, finally settling in to a position as senior executive at the Gillette Corporation. If he resented management, it was not to such a degree that he avoided becoming part of it.

Apparently fond of citing leftists to buttress her argument, Williams also cites a sociologist who is considered a follower of Pierre Bourdieu:

Michèle Lamont, in The Dignity of Working Men, also found resentment of professionals — but not of the rich. “[I] can’t knock anyone for succeeding,” a laborer told her. “There’s a lot of people out there who are wealthy and I’m sure they worked darned hard for every cent they have,” chimed in a receiving clerk.

There’s only one problem with Williams’s citation of Lamont. The people workers “can’t knock for succeeding” are not the rich but the managers they supposedly resent–as an article on workers voting Republican in the Nation Magazine indicated:

In fact, while these workers generally did not feel resentment toward the middle-class managers and professionals above them–saying, for example, that “I can’t knock anyone for succeeding”–their view of them was far from admiring.

You get more or less the same thing in today’s NY Times from Andrew Ross Sorkin in an article titled “A Billionaire’s Party Is a Lens on Wealth in the Trump Era” written by Andrew Ross Sorkin. From the opening paragraphs, you’d think you’d be getting the sort of thing that Matt Taibbi or Chris Hedges writes:

So, Stephen A. Schwarzman had another birthday party.

The celebration for his 70th birthday at his Palm Beach, Fla., home over the weekend included live camels, trapeze artists and a performance by Gwen Stefani. Some reports speculated the party cost as much as $20 million, a price tag that insiders say is ridiculously inflated, but clearly the event fell in the category of over-the-top expensive.

Yet, the entire purpose of the article is to legitimize this gilded-age bacchanalia because working people want to emulate the Stephen A. Schwarzman’s of the world.

The populist, anti-Wall Street sentiment that was so loud after the financial crisis found its voice last year in the campaign of Bernie Sanders — and to some degree, ironically, in Mr. Trump’s. Whatever animus exists against fat cats has been muted among Mr. Trump’s red-state voters, at least temporarily, as long as he follows though [sic] on his promise to create jobs. It’s a point that many of us in the media — myself included — largely missed.

Indeed, Mr. Trump’s surprise election may speak volumes about how large parts of the country view big business today, as well as Mr. Trump’s efforts to lower taxes and deregulate parts of Wall Street. And Mr. Schwarzman is at the center of many of those efforts.

Back in 2012, NPR ran an article which clearly did not get the attention it deserved, especially given what it portended for the subsequent election cycle. The headline: “The Income Gap: Unfair, Or Are We Just Jealous?”

At the time, much of the media was regularly reporting on income inequality, the widening gulf between the rich and poor.

The NPR article was based on the results of a survey by the Pew Research Center that bear repeating: They showed “a significant shift in public perceptions of class conflict in American life,” but “they do not necessarily signal an increase in grievances toward the wealthy.”

According to the Pew report, “It is possible that individuals who see more conflict between the classes think that anger toward the rich is misdirected.” The data, the report said, did not indicate “growing support for government measures to reduce income inequality.”

Maybe that explains it. Or perhaps everyone who criticized Mr. Schwarzman a decade ago is now just too busy focusing on Mr. Trump.

To start with, Sorkin is a sleazy defender of the one-percent so this article is par for the course. Not long after Occupy Wall Street began, Sorkin took it upon himself to investigate the movement in order to provide a dossier for a Stephen Schwarzman type that would allow him to judge the risk to his ill-gained wealth:

I had gone down to Zuccotti Park to see the activist movement firsthand after getting a call from the chief executive of a major bank last week, before nearly 700 people were arrested over the weekend during a demonstration on the Brooklyn Bridge.

“Is this Occupy Wall Street thing a big deal?” the C.E.O. asked me. I didn’t have an answer. “We’re trying to figure out how much we should be worried about all of this,” he continued, clearly concerned. “Is this going to turn into a personal safety problem?”

Like Williams, Sorkin cherry-picks the data to support his conclusion. In referring to the Pew Research report that dismissed support for “government measures to reduce income inequality”, he fails to mention that such measures are supported by 46 percent of Americans. Considering the utter failure of both the Democrats and Republicans to support such policies, the fact that nearly half the country is for some redistributive measures speaks volumes. He also failed to mention another Pew finding that hardly squares with the notion of working people only seeking to emulate Horatio Alger type to become like Schwarzman. Pew pollsters found that 82% of Americans favored policies that encourage economic growth should be high priorities. Since the word policy means government action, this represents a huge mandate for New Deal type action that both Trump and Clinton would have avoided like a vampire avoids a cross.


July 2, 2016

What the Tesla autopilot casualty tells us about our ruling class

Filed under: capitalist pig,computers,technology — louisproyect @ 6:25 pm

On May 7th a man named Joshua Brown died when his Tesla smacked into a trailer truck that the autopilot system mistook for the sky. Brown was a Navy Seal veteran who had worked in the Special Warfare Development Group, the elite unit that killed Osama Bin-Laden. His specialty was dismantling bombs in Iraq. Little did he realize that he was killed by a bomb that was set to go off the first time its onboard computer system malfunctioned.

Apparently Brown was obsessed with his car and its supposedly miraculous ability to forestall highway accidents. He made many Youtube videos about his passion, including the most recent one that illustrated its uncanny ability to avoid accidents.

The Guardian reported that Brown was watching a Harry Potter video when his Tesla careened into the trailer-truck so we can conclude that magic did not come to his rescue. It described the circumstances of the collision:

According to Tesla’s account of the crash, the car’s sensor system, against a bright spring sky, failed to distinguish a large white 18-wheel truck and trailer crossing the highway. In a blogpost, Tesla said the self-driving car attempted to drive full speed under the trailer “with the bottom of the trailer impacting the windshield of the Model S”.

One imagines that Brown must have invested so much in the car and his invincibility because he ran a technology consulting company called Nexu Innovations that was for “Making a Difference in Our Flattening World”. Of course, the concept of a “flattening” world is straight out of the Thomas Friedman playbook. Friedman has been churning out columns on how outsourced tech support help desks in Ghana, etc. would be the answer to the world’s woes and wherever it failed, the Navy Seals could step in and straighten things out.

My immediate reaction to the news of his death was to tell my wife that we should be grateful that Ronald Reagan’s Strategic Defense Initiative, aka Star Wars, was never implemented. Back in 1983 when I was getting re-politicized around the Central America guerrilla struggles, I also decided to join Computer Professionals for Social Responsibility, a group that made blocking the implementation of SDI a high priority.

The technology of SDI and the Tesla autopilot system are both based on artificial intelligence, in effect to give computer systems the same capability of a human eye matched to a functioning brain that follows certain pre-established rules. With Tesla, the goal is to avoid collisions. With SDI, the goal was to make them—specifically to smack into and blow to smithereens Soviet missiles that encroached upon American airspace. Reagan’s goal was to provide a nuclear shield that would give the USA a big advantage in a Cold War that might turn hot. Many people, including someone like me who used to take part in “duck and cover” drills in elementary school in the 1950s, were terrified by the notions being put forward by Reagan and his cohorts.

Reagan believed that missiles could be “recalled” as if they were like remote controlled model airplanes. Even more ghastly was the reassurances of Thomas K. Jones, Reagan’s Deputy Under Secretary of Defense for Research and Engineering, that the USA could recover from a nuclear war with Russia in 2 to 4 years. Jones once said, “If there are enough shovels to go around, everybody’s going to make it.”  We were supposed to use the shovels to dig a hole in the ground (can you imagine New Yorkers running to Central Park with the H-Bomb on the way?) that would be covered with a couple of doors and three feet of dirt on top of them. Jones said, “It’s the dirt that does it.”

As it happens, there is a morbid connection between this doomsday scenario and the capitalist who started Tesla. Elon Musk is not the only the manufacturer who is pioneering such cars but he is the only one who pushes the idea that an autopilot system capable of changing lanes now exists in his automobile. For others working in the field such as Volvo, Mercedes and Toyota, they never saw it more than only a technology good for parking assistance.

Mary “Missy” Cummings, a Duke University robotics professor and former military pilot, told the Guardian that Tesla should disable its autopilot system for navigating multilane expressways. “Either fix it or turn it off … The car was in a place where the computer was blind. The computer couldn’t see the environment for what it was.”

In addition to Tesla, Musk is investing in space travel. He is interviewed by Werner Herzog in “Lo and Behold”, a documentary on computers, the Internet and robotics that opens on August 19th. Herzog, who is much more interested in the “gee whiz” personalities of the men he interviews than their political or social ambitions (a point that A.O. Scott made to me that I had not even gathered), was goggle-eyed as Musk spelled out the need for colonizing Mars if “something goes wrong” on Earth.

The company is called SpaceX and it hopes to have its first launch in 2022. In a 2013 interview with the Guardian, the man who made his billions from Paypal stated that he was inspired to shoot for colonizing Mars after reading Isaac Asimov’s “Foundation” science fiction series whose main character Hari Seldon anticipates the collapse of the Galactic Empire, which encompasses the entire Milky Way. To save humanity, he creates a think-tank that develops the technology to launch a new galactic empire.

Musk told the Guardian, “It’s sort of a futuristic version of Gibbon’s Decline and Fall of the Roman Empire. Let’s say you were at the peak of the Roman empire, what would you do, what action could you take, to minimise decline?”

The answer for Musk is technology.

“The lessons of history would suggest that civilisations move in cycles. You can track that back quite far – the Babylonians, the Sumerians, followed by the Egyptians, the Romans, China. We’re obviously in a very upward cycle right now and hopefully that remains the case. But it may not. There could be some series of events that cause that technology level to decline. Given that this is the first time in 4.5bn years where it’s been possible for humanity to extend life beyond Earth, it seems like we’d be wise to act while the window was open and not count on the fact it will be open a long time.”

In James Joyce’s “Ulysses”, Stephen Dedalus says “History is a nightmare from which I am trying to awake.”

This is our nightmare, comrades. We have a capitalist class that is planning to colonize Mars in order to escape from the disaster it is now creating on Earth. Musk says he expects his business to be profitable since there will certainly be 80,000 people willing to pay the big bucks to flee a planet that has been consumed by nuclear war, catastrophic Noah’s Ark type flooding because of climate change, epidemics caused by viruses unleashed by the penetration of rain forests, or some other unforeseen disaster.

Musk is not the only capitalist who has “escape” plans. Jeff Bezos, the filthy predator who runs Amazon, is investing in Blue Origin, a space travel company that will not aim at colonizing Mars—a place that Bezos writes off as inhabitable—but instead hopes to launch huge satellites that will orbit around a post-apocalyptic planet Earth. In an interview with the Miami Herald conducted shortly after his high school graduation (he was class valedictorian), he said he wanted to build space hotels, amusement parks and colonies for 2 million or 3 million people who would be in orbit. We have no idea what Bezos’s plans are today but one suspected that they are much more in line with Musk’s, to create a sanctuary for 80,000 or so people who share his bourgeois values.

One thing we can be certain about: if people like Bezos inhabited a space station, they’d probably kill each other before the year is up given what they are doing to the planet today.

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