Transcription
[Music] I want to, um, I want to point out, you know, that in every, every class society that's ever existed, um, the ruling elements do not rule nakedly. They always adorn their rule with myths or themes and symbols and, and, and the like, um, to justify their privileged positions at the apex of the social pyramid. Um, so the 1% spins its self-legitimating myths. As I said, no ruling class rules nakedly. All of them make up, uh, uh, they take strenuous efforts to justify their rule. I tell students when they say, "Oh, they don't care what we think, they ignore us," and all that. I say, "Oh, no, no, that's the only thing they care about you. The only thing they care about you is what you're thinking." They don't care if you eat correctly. They don't care how your living conditions are. They don't care that they've built up an inhuman and irrational traffic system that's strangulating us and polluting our air. They don't care about anything. What they, the only thing about you they care about is what you're thinking. In the morning, they start, "What's going to be the story today? How do we manipulate? How do we control? How do we contain? How do we influence? How do we act upon what it is that they have in their minds?"
Modern capitalist societies avoid telling the truth about themselves. Instead, we get those rags-to-riches mythologies, the Horatio Alger stories, myths about fair play, equal opportunity, self-reliance, freedom, liberty, all those kind of things that they feed us again and again. A system that's been so productive and so wonderful and the like. The two fundamental myths of modern corporate capitalism that I want to treat are: the myth that capitalism creates a general prosperity and a well-being, material well-being. That's myth number one. Myth number number two, that capitalism creates or bolsters democracy. We even hear the phrase "capitalist democracies," "Western capitalist democracies," and the like.
Let me start with the one about prosperity. Before I get into that, I, there's another secondary myth I want to put aside. When I'm talking about capitalism, I'm talking about giant corporate capitalism, okay? I'm not, I'm not talking about Mom and Pop small businesses. We're talking about transnational corporations and banks. You know, Lenin himself dealt with that question. He said, he said, "Uh, 10 million small businesses count for nothing. A few giant, count, a few giant cartels count for everything." Um, and, uh, he, it wasn't, he wasn't that he was dismissing or thinking less of the small. He was saying he was talking in terms of power, where the power is, who's shaping the conditions of our lives, who determines the quality of the air we breathe, the food we eat, the water we drink, the kind of jobs we can have, the images we have to deal with and such. That's not Mom and Pop. So I want to put Mom and Pop aside and talk about multinational corporate capitalism.
The prosperity myth that it creates prosperity. Corporations have given us wonderful things, and wonderful for them. Consider some consumer realities: the replacement of public, nonprofit rail transit systems with polluting, expensive automotive transit systems involving billion-dollar highway systems. Millions killed or maimed over the decades who didn't have to be killed or maimed if they, if we had, uh, fast bullet. Well, as, as LA had before General Motors bought up all the tracks, ripped them all up, and made people drive buses, and then finally got rid of most of the buses and made people buy their own cars. The replacement of local, organic food supplies with pesticide-ridden factory farms, genetically modified foods, antibiotic-ridden meats shipped long distances for a long time. This has changed for the better. A tobacco industry, several generations of lung cancer. You remember that wonderful, that wonderful film of the, uh, Senate hearings with the, the representatives, the CEOs from Liggett & Myers and all the other tobacco companies, and each one of them said, "Nicotine is not addictive." And it's not nicotine. They all said that, and they all knew. Meanwhile, the evidence finally came up. They all knew it was addictive, and they were all deliberately injecting more nicotine into the cigarettes so they would be, uh, nicotine. Thank you. Oh, what am I? [Laughter] Smoking. Okay, nicotine. I mean, I'm glad you're with me. Um, don't be so [Laughter] picky. Well, well, they got up. These guys, these guys should be in jail. That's called, that's called, uh, perjury. They lied under oath to Congress. They should be in jail. They never went to jail. But, uh, the tobacco industry is, is, uh, unfortunately, cigarette consumption has stopped declining in America. It's kind of leveled off now, and it's increasing dramatically in the third world. What the cigarette companies did is start moving out to the third world. Cigarettes became the cool thing in a lot of other countries, Asia, Africa, places like that. Unsafe at Any Price. And there's an avalanche of disposable products, cosmetic, medical, whatever products that keep creating solutions for things that are not problems, trying to get you, convince you that you have this need or that problem, and you should buy this and have that.
The history of capitalism has been a history of both great prosperity and great poverty. We often note how wealth and poverty. We often say, "Isn't it how unfortunate that so much wealth here with so much poverty right here?" As if it was just an unfortunate juxtaposition. And in fact, it's not at all. It's, um, uh, there's a dynamic interaction between those two things. This poverty exists because of this wealth. This wealth exists because of this poverty. Uh, it's a dynamic interrelationship. The wealth of the few rests on the poverty of the many. There could not be, uh, *qui*, as Cicero called them, *qui*, *pauci*, uh, Latin. It meant the few, the really elite group that ruled the Roman Senate. The Roman Senate is as such one thing, but that inner group, the richest, most powerful men running the Roman Senate. They, they could not have, um, ruled and lived the way they want if they didn't, unless they had slaves and proletariat, impoverished people who worked for bare subsistence. Um, there could be no Lords and Ladies without serfs who labor from dawn to dusk to keep the Lords and Ladies in the style to which they are accustomed. There could be no capitalists without workers and indentured workers and debtors and taxpayers and all sorts of other people. So there's a, there's a real relationship between wealth and poverty.
Do the, I, I'll return to that in a minute. I just want to say something else. Do the, do the 1%? That top plutocracy, which, you know, it's really not 1%, you know that, don't you? 1% would be three million people. It's really more like a fraction, about one-quarter, tenth of 1%. It's about 12,000 people who really compose the super-rich and have the wealth of America. And, and when people say, "Whoa, you know, that, oh, that top 1% has as much wealth as the bottom 30 or 40%." That's not true at all. The bottom 30 or 40% has nothing. I don't know where people, what, why people are saying that. Robert Reich, I heard him say that the 140 richest billionaires have as much wealth as the, as the poorest, uh, oh, what was it? 75 million people. The poorest 75 million in America don't have a pot to spit in. They, most of them are in debt. Most of them are maxing out on their credit cards. Most of them are just barely getting by. H, how are you comparing these two? What, what kind of, what kind of a dazzling statistic is that supposed to be?
But does that 1% believe their own mythologies? Yes, of course. People believe in their own virtue. Yes, of course. They believe in their own value to society. Of course. You think Mitt Romney doesn't? He thinks he's God's gift. Well, he's got a special problem with the Mormon stuff and all that, but he, he thinks he's God's gift to society. For the most part, the class propaganda they put out elevates them, just justifies their worth. So why would they not believe it? They find it very persuasive. We all find things very persuasive that are flattering to us, rather than things that are, that are, that are critical of us. "You don't know what you're talking about." "What do you mean?" "That's what you..." But when someone says something that's positive, you say, "Oh, you really think so?" Hey, they believe, they believe, uh, uh, you know, it elevates them, it justifies their worth. So why would they not believe it? It's very persuasive because it serves their interests. They believe that the poor are the authors of their own poverty. They believe their own wealth is earned and socially useful. It creates jobs, it provides growth. They believe the free market system is the most productive and beneficial in history. They believe competing systems and reforms and government regulations are harmful and distress from the performance of the, uh, good things. They believe that government should not be a nanny state tending to the needs of the needy. "Let them learn self-reliance." Those people down there with their hands out.
At the same time, they overlook the fact that their own class is not at all self-reliant. No one is more reliant on government handouts than corporate America. Um, we, they get tax breaks more than you and I get. They get about $100 billion dollars a year out of every budget in direct subsidies. Everything that they produce is, almost everything is subsidized by the government. They get loan guarantees, they get export subsidies, they get equity grants and land giveaways. They get almost free leases on a lot of government land to do what? Harvest the timber, mine the copper, drill for the oil. They get oil, they get oil giveaways practically, or leases, or the land. I mean, it'll be estimated that there's, that there's a $15 billion dollar worth of oil in a certain reserve on the government land, and they'll lease it. The government will lease it to them for, for like half a million or a million. Peanuts or something, so they can go ahead and take that. That's stealing from the public treasury. The airwaves. They get to lease the airwaves for a song, for a song. Fox News gets to get these airwaves. The airwaves, ladies and gentlemen, brothers and sisters, the airwaves are the property of the people of the United States. You'd never know it, though. They're, they're sent out, and they're, and they're used to great profit by the, um, media corporations and their advertisers and, and the like. And they get bailouts. They get billion-dollar bailouts. Mom and Pop doesn't get a bailout. If things go down, you go out of business. You lose your grocery store, you lose your little cafe, whatever it is. Federal government does not give you a bailout and say, "Hey, you're too small to fail. Let's give you some more money to boost you up here a little bit." That doesn't happen.
Well, big corporate capitalism, besides being hypocritical, self-deluding, and diluting us, is also an irrational system. Marx said it was a ruthlessly rational system that demystified and shattered the Dark Ages. You know, there's that incredible paragraph in The Communist Manifesto where Marx and Engels talk about the dynamic, productive energy of capitalism and how it broke loose from the shackles of a thousand years of the Dark Ages. And if you read, you know, and if you read the enlightened men writers, uh, I had a book of the book, an anthology of the Enlightenment. I started reading them. I was so struck. I mean, I was just so struck by how naively enthusiastic they are. I mean, just like a Ben Franklin or people like that. They were just there at the edge, knowing that the world was opening up. And I said, "I got to be, I've got to be a little more generous." These guys, they're coming down from a thousand years of the Dark Ages. They're coming down from a from a civilization that condemned the Paris Medical Society and the medical school in Paris for, you know, what? What did they condemn Paris for? Empiricism. They said Paris medicine suffers from empiricism. Back, this is back during the time of Louis XIV, Louis the 14th or so. That empiricism, that is, they were doing things like cutting open cadavers and looking and learning what the body really was about, and where it was, and what happened, and, and doing that sort of thing, rather than using the Bible as its authority for judging why someone is sick. And there are four humors, there are five this, and there are seven that. And you, you made these, you made these, these old superstitious deductions, and then you gave the guy whatever it is, the eyeballs of a frog to eat, or, and, and, and, and he had to say 10 Hail Marys, and that would make them better.
So, so these, so the, so the people of the Enlightenment are coming down from that, and, and the whole world is opening up. And Marx is pointing out how well, you know, from the late 18th century right up to his day, which is the middle of the 19th century, in that 60 years, they saw all sorts of sciences emerging. They saw, they saw continents being subdued, dude, canals being dug, the canals then being ignored because they were building railroads now across stretches of land. And they saw this incredible burgeoning of mills and mines and, and all this sort of dynamic, um, explosion. So this, Marx says, is really, you know, a very impressive thing. It is. But it becomes irrational in its social relations. I would also add that capitalism is amazingly, amazingly irrational in regard to the environment. It explicitly ignores the environment, if you know what I mean. Uh, it's, and it doesn't really ignore environmentalism. Uh, it's more than ignoring environmentalism. It condemns environmentalism. It, it attacks it. It has pejorative terms like "tree huggers" and, um, what, what are, what are some of the other terms? "Eco-terrorists," right? "Eco-terrorists." What are they talking about? They're the eco-terrorists. Um, and, um, so they're irrational in regard to the environment. They treat the environment, first of all, they treat it, and its resources, as limitless. And that's incorrect. We now know most of our topsoil is almost gone. Um, and it, and the environment is not limitless. That's one. And they also treat the environment as disposable. Um, it's, it's a disposable environment. You can use up some stuff here and turn it all into wasteland and toss it aside and move on to somewhere else and do the same.
Capitalism's crises are not exceptional. They are the common mode. In other words, under modern corporate capitalism, the irrational, the wasteful, the destructive, the impoverishing, all of that is the norm. Normal, normal, balanced, productive, calm, equitable social relations and periods are the exception. Crisis, panic, recession, crisis again. That's the norm of capitalism. In the late 1780s, we had debt rebellions in America. Shays' Rebellion, the best known one, maybe, but others too. After the American Revolution, we had monetary crisis. Then there was the Panic of 1792, the Panic of 1809, which lasted a, a number of years, the Panic of 1819, the Panic of 1837. Let's skip, let's skip the rest of the 19th century. You can go on to the very end of the century, that, that decade of the 1890s, where the economy, the US already was the leading manufacturing country in the world. Um, and, um, and yet that whole, that whole decade, 1890s, they couldn't pull out of the recession. They were having a tough time. Teddy Roosevelt said, "We need a war. Any war. Let's have a war." They were looking for war. I mean, very explicitly. War would do two things: one, it would stimulate the economy and get it going, and two, it would, uh, distract people from their economic grievances and get them flag-waving, which indeed it did with the Spanish-American War.
All through the 20th century, wars and recessions. We, we know the 1920s as the Jazz Age, you know, Charleston, Charleston. Oh, and things were great. The 1920s were a period of severe recession, especially in agrarian, agrarian areas, less so in the cities. After that, after that came the Great Depression, as you know, 1929, and that lasted right on up to 1941, when World War II began. Um, all through the 20th century, we've had wars, recessions, inflation, market crashes, investor panics, depressions, massive deficits, bubbles, and bailouts and subsidies. Hardly a normal year. When you got the free market, that market ain't so free. It is a system that can never settle with itself. The corporate crimes and crises we endure are not irrational departures from a rational system. It's not that this is an irrational time or a crazy time. It's, it's the converse. Just, just the converse of that. They are the rational outcomes of a basically amoral and irrational system. When you got that kind of system, this is what you're going to get. It's not that these are just some deviancies, some real bad things, or some Bernie Madoffs did this, and then now it's all upset and all that. No, that doesn't work. Uh, the, the system puts forth these people and rewards them tremendously.
John Maynard Keynes, the liberal, um, the guru of liberal capitalism. And Keynes, and Keynes is looking pretty good nowadays. But it's hard that with the free market, the free market orthodoxy prevails in much of academia, in economic departments, that you can't even read Keynes. Anyway, it makes a lot of sense. He made, made this point. Now, he was the guru of liberal capitalism. He was not, he was not its shill. He wasn't its shill. He was not selling it. He was quite critical of capitalism. And he said, quote, "What an astonishing idea that the most wickedest of men," he uses a double superlative there, he uses bad grammar to be cute, to sort of emphasize the point. He says, "What an astonishing idea that the most wickedest of men, doing the most wickedest of things, will produce beneficial results." That's what he was saying when the, when the depression came. He said, "Whatever could you possibly have thought was going to happen if you leave these people, uh, to be doing all this stuff? People who are not known for their human empathy or their willingness to sacrifice and share, and even if they were known for that, they seem to lose it once they get into this game."
Corporate America, and both of its major parties, and both political parties are in the service of corporate America. The leader of the Democratic Party, uh, uh, Obama, Barack, Barack Obama, in the debate just last week with Romney, made his profession to the free enterprise capitalist system. He said that, you know, he's very explicitly made that point. They're wedded to a system that brings poverty and hard times and attrition. Most of the world is capitalist, and most of the world is poor. Capitalist Nigeria, capitalist Indonesia, capitalist Mexico, capitalist Thailand, capitalist South Africa. I said to you, I said, "Capitalism creates immense prosperity for a few, but it creates immense poverty." And here it is, all of these capitalist countries. They're usually not even thought of as capitalist countries, isn't that right? They're just thought of as third world countries. No, they're capitalists. They're big companies that are in there, and they hire people, and they got mines and mills and, and whatever else. And, and as capitalism spreads and grows all over these worlds, so does poverty. The number of people living in poverty is growing at a faster rate than the world's population. Did you get that? So that poverty is spreading. In other words, spreading even as wealth accumulates. Even in the United States, in 1900, the United States was a third world country. 50 years before the term was invented, we had typhoid epidemics in Philadelphia and Baltimore and places like that. We had chronic and mass underemployment, chronic and mass poverty. We had, um, all that sort of stuff, all the diseases of poverty too: tuberculosis, malnutrition, rickets, and the like. I remember as a kid, tuberculosis and rickets and all those were still, those were still, um, diseases to be dealt with.
The great American prosperity, America as the land of prosperity, is a myth. It was, it didn't exist. The Great Depression came along. At the same time, Western Europe, those great wonderful social democracies like, like Finland and, and Denmark and Norway and Sweden and life, where life, where life and social services have been better for a while. They were third world countries too. People were living hard and mean lives in those countries too. World War II brought a massive increase in spending in America. There are three things that led to the American prosperity that came. That prosperity started developing 1945, '46, '47, in the, in the 1940s, and that came by, for three things, as I see it: One was the great backlog of consumer demand. An interesting thing started happening when World War II came. All sorts of people started making money. My uncle, I have an uncle Nick. He was a mechanic, a working-class guy. I come from an Italian working-class family in New York, East Harlem, which was a big Italian neighborhood in those days. Uncle Nick worked in a, in a garage. He made about $40 a week, which was good money in those days for blue-collar working-class people. When the war came, he quit being an auto mechanic and he, first of all, there were many, many less automobiles on the road. Nobody had had automobiles. He became, he went to work in an arms factory and was making $100 a week. I mean, $100 a week was unbelievable. The problem was, there was nothing to spend it on. Oh, he found, he went to nightclubs and did things, all, but even he had a surplus in his lifestyle. You couldn't buy cars because Detroit was now making tanks and planes and the like. You couldn't buy new refrigerators. You had to keep your old one if you had a refrigerator. Many people still had iceboxes with ice in it. My family did. And the like. But, but what it did was, everybody said, "When this war is over, there'll be a depression." In other words, we'll be back to the way it was in the '30s. When the war was over, you had this backlog of consumer demand, people wanting things and having saved up money from all the jobs they had during the war because the government was spending and spending in a way that, that some of this just trickled down, did get around. That this was the kind of money they could not, they could not spend it during the Depression itself. They couldn't spend that much, but they could spend it for war and killing.
The second, the second thing that happened besides this great backlog of people wanting homes too, and, and as I say, all these durable consumer goods and the like, after World War II, there came what was called the GI Bill of Rights. I remember there was constant talk about what happened to our veterans after World War I. And constant little pictures, old photographs and such, of veterans of World War I standing on the corner selling apples. And the word was out, "Are we going to let our boys come back from, from the Pacific and from Europe now this time, and we're going to make them stand on corners and sell apples again?" And Congress was really swept up in this thing. And so they passed this remarkable legislation, the GI Bill of Rights, which, really, unlike the GI Bill today, which is so miserable, so, so meager, so deficient, that guys come back for a GI, and they, they volunteer in the Army in the hope of getting these GI benefits. They come back, and they get them, and it's not enough. They have to, they have to borrow money, they have to take extra jobs and the like. It's very disappointing. The GI Bill back in 1946, '47, was a terrific deal. You got a stipend, a full amount to be able to live on, and you had all your tuition paid, and it was, nobody had to run into debt, nobody had to take second jobs or this to that or anything like that. And the GI Bill took about, um, 9 million, 9 million Americans came back and got the GI Bill. Many of them got trained as professionals, as artisans, as skilled workers, as all sorts of, going into businesses. I knew a friend of mine, a florist business. His father, his old Italian father, had a florist shop, and he learned new ways of doing bouquets and all this stuff and advanced the business and so forth. There was an incredible, an incredible shot in the arm when you inject it with all of these people who are better trained, better skilled, capable, ready, willing, and doing all this kind of work. So you had that, the backlog of consumer demand and the GI Bill of Rights. And then the third great stimulus was the giant military budgets. That by 1947, Harry Truman was pushing military budgets that was, it wasn't as big as World War II, but it's as big as we know him now. Now, that is, uh, it led to the building of an enormous armaments industry, which, which kept a lot of those top-paying jobs for blue-collar workers and such. So you put those two, those three things together, and you got this dream about the ordinary worker living the middle-class life. He now had a little Ticky-Tacky house in a development, he had a little car, and his kid could go to the state university. That was terrific. This was like something that he or his grandpa could have only dreamed of doing. And that prosperity lasted until 2008. It started going under attack in 1978. In 1978, which was the beginning of the third year of Jimmy Carter's administration, a US Chamber of Commerce guy commented and said, "We have got to roll this back. We've got to stop it. We are becoming a social democracy." So these guys understood the term "social democracy." There's only about four or 500 people in America who understand the term "social democracy" and are familiar with what it means. The social democracies will use that term to mean Finland, Norway, Sweden, Denmark, Holland, to some extent, France, Western Europe in general. It is countries that are, that are capitalist, but the private, the public sector has been expanded and is, um, is creating a social wage that is really helping, helping the people. You know, healthcare, guaranteed free healthcare, affordable housing programs, job programs, and, and all, all that kind of stuff. That's what was, that's what was social democracy. Paid vacations, good wages. That same emergence of a social democracy was developing and emerging for the first time in their history in the social democracies in Western Europe also. And there they had another impetus. They had terrible destruction from the war. It wasn't like the US, which was very prosperous and hadn't, hadn't lost a single house in World War II. But they had had something else. They had this other enormous impetus. They had the Marshall Plan, the US sending them millions of dollars to reconstruct. And they had Soviet troops along the Elbe River. And there it was, all of Eastern Europe, where you had countries where people had a guaranteed right to a job, guaranteed free medical care, all of these things under communism. They may not have had the freedoms that people might want, but they had these other things. And, and that became the big competition. That also became a competition in America. Again and again, US spokesmen would get up and say, "We have to demonstrate that our people have, have a decent living and this and that, and it's much better than what the poor people in communism." They never allowed, they never admitted that the Communists had a good living and all that sort of thing. But the same thing with race relations. They say, "It's, it's disgraceful. We're going to lose the battle for men's minds if we don't improve." Much of civil rights. Many of the civil rights liberals would start off every time they got up, and they would, and they would have to say, "If we want to win the Cold War against the Communist adversary, and most of the world, you know, is not white. It is black, brown, yellow, whatever, ten, whatever the different hues are. And, um, and, um, and those people will not believe us, and they'll turn toward the Communists unless we get rid of Jim Crow, and unless we, uh, build a more equitable life with civil rights for people of all colors." So the influence, the threat, the competitive image of the communist countries was another impetus that led to, um, that spurred them on. And, and it led to what was called, what was that called? The, the great historic compromise with American labor. That American labor would come in, and there wouldn't be this class war anymore, and labor would get its cut. All right, your boys will get a contract. We can work three years under these conditions, right? And, and you'll get, and you'll get, um, you'll get vacation time from now on. You get an eight-hour day. Finally, you've been fighting for, you've been fighting since 1920 for an eight-hour day. I mean, say 1900 to 1920 was a 10-hour day. They were fighting for. Now they're fighting for an eight-hour day. We're going to give you an eight-hour day. You're going to get time and a half overtime. In fact, that was done in the New Deal. Some of these things were even done during the New Deal again, because of the threat of revolution. The Communist Party in America had 100,000 members. There was all sorts of lefty groups coming, agitation of all kinds. They made certain kinds of concessions. We got to, we got to let you have this. Not only get a vacation, you get vacation with pay, you know. And, and that was the way it was going, and things were getting improving again and again.
Well, there was that element within American capitalism that was saying, "This is too much. When is it going to stop? We don't want this social democracy." And in 1979, that year I told you about, Reaganism began. Back in those days, in 1980, when Reagan won and was president, I said Reaganism came in two years before Reagan, and that was under Jimmy Carter. He immediately increased the military budget. He started cutting back on, uh, the social wage, on, on benefits of various kinds, and the like. And so, so there was this, uh, rollback. A couple of years ago, I was reading in The New Yorker, and there was a GOP leader, and he said, "Things are pretty good. Our goal was to roll back the social democracy." There's that word again. These, these Republican leaders know about social democracy. They never use the term publicly, but they use it when it's a question of the class struggle that they're waging against us all the time. He said, "That was our goal, and we've succeeded. We have succeeded in rolling back the social democracy." Well, they, they've rolled back quite a bit. I mean, life is very tough and getting more raw and more raw and raw and the like. If you ask George W. Bush, it wasn't completely rolled back. He said, just a couple of weeks ago, "Did anybody see that? He said, 'My administration was a success. He got what he wanted. He, he, he said he cut the taxes on the rich. He rolled back all these government regulations and controls. He, he, he didn't, he didn't mention this, but he got involved in, in the war in Iraq and led to enormous spending. He, he more than doubled the, uh, the military budget in America." He said, "But I have two failures, two things I left unfinished. I couldn't accomplish, and that was rolling back Social Security and Medicare." Which is admitting a lot. And we got a guy in office right today who said, "Social Security and Medicare. I'm talking about Obama. He said, 'Social Security and Medicare are on the table. They're there to be bargained and, and, uh, trimmed if we, if we have to or not.'" Social Security, which is the most successful anti-poverty program America has ever had, is on the table.
And in Western capitalism, you got the same kind of thing happening. You know, they, as I said, they had to make all these concessions here with this, this, this, uh, wave of communist countries and giant communist parties in France and Italy agitating and such. They were making all sorts of concessions: vacations and social wages and working wages, minimum wages, and medical care, and this and that and so forth, and pension rights and the like. Now today, that's being all rolled back in Western Europe, under the guise of austerity, under the guise of the crisis of the system. They're using the crisis of the system itself as the bludgeon to force working people to now, uh, make sacrifices and get rid of the social democracies. And that's their goal in Spain, Italy, Greece, and pretty much anywhere.
So, you see, recessions can be a weapon and a very useful one. Recessions are not such a bad thing for the 1% at the top. Mitt Romney, did he suffer much through this past recession? Did any of his five sons, all of whom have multi-million dollar trusts, did they suffer very much in this past recession? Did they show any signs of suffering? I, I don't, I don't think so. I mean, I didn't spend too much time with them. I, I, I don't really know. I don't really know. But, um, but it's a recession is not really so bad for the big boys. It really isn't. A recession is a form of mass poverty, but it's not bad for the big boys. Otherwise, we wouldn't have so many of them. You know, if it was bad, recessions tame labor. Labor gets tamed. Labor unions get broken. Labor unions settle for miserable contracts, almost next to nothing. Recessions, uh, tame individual workers. All sorts of people line up for jobs today who would not have imagined working for those wages just, uh, five years ago. Small businesses are bought up at bargain prices, and even big ones, big businesses swallow big businesses. If you study media, the media ownership patterns, they don't just buy up small independent radio stations, newspapers. I mean, you got big businesses buying other, other big huge businesses.
You see, the 1% also does not want a well-educated, self-confident public. They don't want a public, a workforce with a developed sense of entitlement. They don't want people with high levels of expectations. They want us hungry. In that sense, recessions are quite useful. The hungrier you are, the harder you will work for less and less. Why do you think Indonesians work for 17 cents an hour in Indonesia? 15, 16-year-old girls working for 17 cents in a Nike factory to make those shoes that Nike then brings over here and sells you for a real bargain for $200? Shoes that cost them $8 or $9 to make, even with all the outsourcing and all that and transportation costs. Why do you do that? Do they do that because they're so concerned about you? That's some bargain. $200 for these shoes. Wow, that's so cheap. No, that's not cheap at all. That's very expensive. But, um, but why did they do it? It's to increase the margin of profit, to diminish the cost of production, and keep the price high and fancy. So why is it the US? Why is it US workers don't work for 17 cents an hour? Is it because we're so much more self-respecting than the Indonesians? Is that it? Or is it something else? It's that we are at a level of historical struggle where we don't want to, and don't have to, and will not work for 17 cents an hour. But the goal is to get us down closer to that number from where we were. The goal is to get rid of those benefits and paid vacations. And more and more jobs now are just contracted. There are no benefits, nothing. You just, the hours you work, you get paid. If you're late off for two days, you're off for two days. That, and, and the like. So there's real method in their madness.
And by the way, all those signs were coming, that crash of 2008. Before that, the, the seven or eight years before that, there already was another six million out of, out of jobs. I got those figures somewhere here, right? Six million out of a job. Median family income had declined by $2,000, which was a lot of money for modest income families. Seven million people lost health coverage in that time. The consumer debt more than doubled from, from 2003 to 2008, compliments of, uh, of George Bush and Dick Cheney. So, but it was okay with the guys at the top. The Dow Jones was up at record highs, and the banks were making more money than, than Santa Claus. They were having a great time.
Another myth is that capitalism fosters democracy. And that, I'm just going to laugh away. Every democratic gain we have made has been with the opposition of that ruling class, the ruling landed, merchant, banking, investing class. Opposed the abolition of, of, uh, property qualifications for voting. They opposed that. They did not want to abolish. They, they supported property qualifications. They have always fought to limit, to limit the number of people who can participate in democracy. We see that happening right today with the voter, so-called voter fraud things. You have to have proof that you were born here, and this and that. And using these things, they've disenfranchised, they figure, several million people in, uh, in various states. Here in the US, they have never thought the people should be doing much with government. If you look at every elitist from ancient Greece with Socrates, right on down to Roger Sherman, Alexander Hamilton, John Jay, all of them saying, "The people should not rule. The people who own the land should rule it." And, and the like. Very explicitly. And today too, you see all sorts of undemocratic laws being put in suspension of habeas corpus, mass arrests, use of torture, use of the FBI for illegal use of surveillance. These are all, these are all instruments of the conservatives. Their goal, in fact, is to put hamstring and limit democracy because democracy does not, um, serve. When democracy is successful, that creates problems for free market capitalism.
Let me just say something about this. The free market advocates insist that everything works better in the private sector rather than the government sector. Therefore, we should have government run more like a business. So, you know, you and I might wonder, how could that be possible? Exactly what businesses should government be run like? The 50,000 firms that go bankrupt every year? Or the large successful corporations themselves, giant bureaucracies, recipients of billions of dollars in public subsidies, bailouts, payouts, with big multi-million dollar salaries to every agent head? So the Secretary of Transportation now should make a $10-15 million salary. If you want to run it like a private business, the CEO, he's the CEO. If we run government like a business, who would take care of the costly nonprofit public services that the public demands, and business itself demands? Operational expenses are generally less in public bureaucracies than in private corporations. Administrative costs for the, uh, US government's Medicare program are under three cents per dollar. That's socialism in action. Three cents a dollar administration. You're always, you're taught that bureaucracy, it's so wasteful, it's this. Government is wasteful, corrupt, and the like. Administrative costs for private profit health insurance are 26 cents per dollar. That's capitalism in action. Poor service at higher expense because the explicit function is to extract profit. It's not to give good service at low cost. Social Security has been more reliable and less expensive as a retirement program than private pension plans. A Roper poll asked Americans to estimate the administrative cost of Social Security as a percentage of benefits. So they're so used to being told that government is so wasteful. Respondents said, "Well, Social Security's administrative costs, I would say, 50 cents, 50% of their budget is for administration." Actually, it's 1%. That's socialism in action. By comparison, the administrative costs for private retirement plans are about 13% of annual payments. Public utilities owned by local governments offer rates averaging 20% less than those charged by private power companies that operate for profits. That's socialism in action. What do you have here? Do you have a public utility or private? What, I can't hear you. We're having an election right now for, for a public one. Yes, very good. That's great. The most expensive one is PG&E where I live in North, in North Cal, Northern California. PG&E spent $2 million in lobbying and transferred $5.1 billion in profits to the most affluent stockholders and executive heads over a three-year period. That's capitalism in action. But now let's look at some public utilities. The one in Palo Alto transferred $7.3 million to the, to their local government budget. PG&E transferred zero to the California state budget. And Palo, the LA Public Utility transferred $124 million to their, uh, local governments. That's socialism in action. They made money. They not only gave you lower rates, but the money they made, they put into the budget, which would then keep your taxes down and, and help you. PG&E has given nothing back to the communities. It all goes to their stockholders and such. The capitalist leaders want to eliminate public spending programs not because they don't work, but because they do. That's why they want to get rid of public utilities. They work fine. They demonstrate that this thing could be done cheaper and at greater return for the public and such.
That's why they're destroying the US Postal Service and inflicting upon it a terrible. Go to Common Dreams and Jim Hightower has a good article on, on, on the, uh, post office. The post office isn't going broke. It wasn't, it's not, it's not dwindling. It's, it, it's handling more mail today than it ever did, even before the internet. It may not, not as much first-class mail, but an awful lot of junk mail and such, and the other stuff. But, um, I call it junk mail. I mean, it serves some, some service sometimes. But, but they've been forced to raise $5 billion a year for a pension fund for workers that haven't even been born yet. It's for the next 70 years they're supposed to finance this thing. It's a way, literally, of of underfinancing and stripping and destroying the US Postal Service. And that's what they're doing. And they're doing that because it works. You tell me, you tell me what private postal service, what private postal service in this country will deliver door-to-door from here to New Jersey, let's say, a piece of mail to my Aunt Tessie for 45 cents? What, what private company will do that? Nobody. You know what your mail will cost if you want to send somebody a birthday card or, well, you won't, you're going to send it over the, over the internet. But, but, but there are people who still do that. It, it would cost, it's going to cost quite a bit. And that's what's wrong. That, that is any kind of service that outperforms the public, uh, that outperforms the private corporations shall be, shall be, uh, attacked. And that's why Social Security is being attacked. That's why Medicare is being attacked, and so forth. These represent threats to profit markets.
So let me just tell you about as far as the environment goes. There was a cartoon in The New Yorker, uh, a year ago. It showed a guy at a business meeting, you know, he had a lectern here, and there was the table, and people all sitting there, and there were all the charts in the back and all. And he's saying to the business meeting, he's saying, "So, while the end-of-the-world scenario will be rife with unimaginable horrors, we believe that the pre-end period will be filled with unprecedented opportunities for profit." And that's where they are. That's why I call it a pathology. These guys are crazy. I mean, this thing is happening right before their eyes. The Arctic is melting. Years ago, I said, "They're not going to wake up until the North Pole itself melts." I didn't say Arctic, I said the North Pole. Well, the North Pole is melting away. And now, and what are they doing? They're going, "Oh, we can get at the oil that's under there." The very oil and fossil consumption that's causing all this. "Oh, we'll have a Northwest Passage finally." As old as Lewis and Clark, over 100 years. We're now, the dream was always to find a Northwest Passage to the Pacific, you know. But now we could have it. No more going through the isthmus, no more going all the way down Cape Horn or anything. Now we can just, we'll be able to cut. And they've got corporations developing whose specialty is to show other corporations how to make money with global warming. You see, they're crazy.
And so I had this image. I pointed, I said, "We make, just imagine that everybody, everybody in the world was in this bus, a very large bus, and we're hurtling down this road, and it's going to plunge off a cliff." You know what these guys will be doing? They'll be running up and down the aisles selling us seat belts at at very inflated prices, because they, very inflated prices. Um, and, and, and, and that's where they are. They're crazy. They have, it's a, it's a rational pursuit of irrational ends. Becomes itself, the pursuit itself becomes irrational. And these people themselves, although they sound perfectly rational, are part, part of this pathology. And our job is to, our job is to grab control of the bus, turn it around, get these guys off the aisles, maybe open the door, throw them out, slow down, slow down first, when you throw them out, and, and the like.
And, um, I leave you with this. Someone, someone wrote this on the internet, and I couldn't find out the party's name, but it was something like this. Actually, I'm rephrasing it. Quote: "What an incomprehensible, insane world it seemed to me until I realized that it was ruled by rapacious, money-mad sociopaths. Then it all made sense." And that's what I tried to do here now, was have it all make sense, in the hope that we can bring good sense to triumph over self-driven greed and pathology. Thank you very much. [Applause] [Music]