Republicans attempt to destroy capitalism

Thursday's events were extraordinary. The Paulson administration had basically come to terms with the Democratic Congressional leadership on a bailout plan, agreeing to give up Paulson's demand for dictatorship over the economy and include funds for non-ultra-rich people to make the far larger funds for ultra-rich people more palatable. Then, at a meeting called to finalize the arrangement (or so the Paulson administration and Democrats thought), the Congressional Republicans proceeded to reject the whole framework in dramatic fashion - while John McCain sat silently by:

once the doors closed, the smooth-talking House Republican leader, John A. Boehner of Ohio, surprised many in the room by declaring that his caucus could not support the plan to allow the government to buy distressed mortgage assets from ailing financial companies.

Mr. Boehner pressed an alternative that involved a smaller role for the government, and Mr. McCain, whose support of the deal is critical if fellow Republicans are to sign on, declined to take a stand. . . .

Thursday, in the Roosevelt Room after the session, the Treasury secretary, Henry M. Paulson Jr., literally bent down on one knee as he pleaded with Nancy Pelosi, the House Speaker, not to “blow it up” by withdrawing her party’s support for the package over what Ms. Pelosi derided as a Republican betrayal.

“I didn’t know you were Catholic,” Ms. Pelosi said, a wry reference to Mr. Paulson’s kneeling, according to someone who observed the exchange. She went on: “It’s not me blowing this up, it’s the Republicans.”

Mr. Paulson sighed. “I know. I know.”

Why would the Republicans do this? There are two explanations: because they really believe that the government shouldn't be involved so much in the economy, or because they're looking for short-term political advantage. The electoral advantages are obvious - a large majority of the country is opposed to the government bailout (55 percent vs 31 percent in favor).

But the changes that Republicans have demanded are revealing (tho completely unworkable), and they may actually believe their free market ideology. On September 18 over a hundred House Republicans wrote a letter to Paulson and Bernanke, arguing that “federal investment in such large amounts of private company stock has the appearance of a socialist and not a free market approach to managing our economy.” Representative Jeb Hensarling of Texas, speaking for many of his colleagues, referred to the bailout as “the road to socialism”. If only it were so!

This represents a stunning ignorance of the nature of both capitalism and authoritarian planned economies (which is what they actually mean when they say socialism) - an ignorance that could have disastrous consequences. Thruout the 20th century, “socialism” was the bogeyman of the American elite - but it was not a single thing. Rather, it was a polemical conflation of three things: the Soviet Union's threat to American global hegemony, the threat of workers to capitalists, and the inconvenience of government regulation and spending to capitalists' free pursuit of profits.

The first two problems were, in the end, solved thru a blood-drenched history of foreign intervention and labor repression. Both were real threats to the power of the economic elite over society and internationally. But the third issue is not a threat at all - it is a periodic necessity required by the crisis tendencies of capitalism itself.

Yet much of the right wing is incapable of analytically separating these three issues, and instead interpret the world thru this polemical slogan. Thus all government programs and interventions in the economy become “socialism”, and since socialism is the enemy of all that is true and just, it must be avoided at all costs.

This kind of thinking is what turned the crisis of 1929 into the Great Depression. For three years the Hoover administration, paralyzed by its laissez-faire ideology, refused to take the aggressive action necessary to mitigate the crisis. The result was nearly the destruction of capitalism.

We are unlikely to see a repeat of this disaster - the servants of capital in the government now have decades of experience with economic intervention to prevent the market economy from destroying itself, and agreement on the bailout now seems near. But we could be seeing the birth of a new right-wing myth of betrayal.

The right never forgave FDR for saving capitalism by using government spending to co-opt popular anger and stimulate the economy. Screaming "socialism" the whole way, they fought a bitter and mostly futile rear-guard battle against the emergence of the Fordist regime of accumulation (altho it is a tribute to their hysterical anticommunist campaigns that the United States remains the only rich country without universal government-provided or -guaranteed healthcare, itself a major drain on business). The resentment at their failure to reestablish the absolute freedom of capital combined with the major challenges to American supremacy and white privilege of the 1960s to fuel the rise of the right that we now suffer thru.

If the current crisis ushers in a new era of regulation and government spending, look for the right to cast the bailout as the moment that betrayed the promise of free markets to organize their utopia of inequality. This mythical association of market economics with individual freedom is the foundation upon which all rationalizations of inequality are based, and the rock upon which our attempts to deepen democracy and reduce social divisions have repeatedly been smashed. Of all the failures of the American left, the failure to counter this myth by spreading a realistic understanding of how capitalism works is perhaps the most fundamental.

Review: There Goes the Neighborhood

I've posted a review of There Goes the Neighborhood: Racial, Ethnic, and Class Tensions in Four Chicago Neighborhoods and Their Meaning for America (2006), by William Julius Wilson and Richard P. Taub, on Amazon. Chicago comrades might want to read it - it's not the greatest book, but you get a good idea of the diversity of the South Side as well as some classic examples of Chicago racism, and it's a fast read.

Capitalist disaster season is here once again

Five hundred years of capitalism has produced one crisis after another, an endless procession of violently deflating asset bubbles and horrific wars inextricably linked to competition over markets and resources. So it is frankly bizarre that, as the latest such crisis destroys massive amounts of wealth and threatens catastrophe to the entire world, mainstream American opinion lamely argues over whether lax regulation or the character flaws of securities traders and mortgage buyers are to blame. How many centuries marked by serious crisis every 30 years or so and punctuated by numerous smaller disasters will it take before we learn - capitalism creates devastating crisis by its very nature!

The state's role as guarantor of capitalism, as the only agency that can step in to prevent the system from destroying itself, is demonstrated anew with every crisis. What's really interesting is not this well-established phenomenon, but the cries of outrage against it. Libertarians squawk about the moral hazard of bailing out irresponsible financiers, who walk away from the disaster they created with millions of dollars apiece. This is a fascinating ideological subculture whose members actually take seriously the rationalizations used to justify the despotism and staggering inequalities required by market economies. The consistent application of their ideals would quickly destroy capitalism itself.

Liberals, meanwhile, decry the hypocrisy of a government that can come up with hundreds of billions of dollars on short notice to rescue rich people in trouble but which dismisses the everyday crisis of living poor in America as an individual problem. Don't liberals know by now? "Privatize the gains and socialize the pain" has always been the fundamental principle of free markets, and it really couldn't be any different.

The mistake of both groups is to conceptually separate the government from business. The capitalist state should be understood as fundamentally internal to the economic system, an institutional outgrowth of capitalism just as much as capital markets and commodities exchanges are. Capitalism could never function without the state to guarantee contracts, to make unprofitable investments that are necessary for commerce (especially building infrastructure and subsidizing transportation), to secure access to markets and raw materials within the system of global competition, and perhaps most important, to suppress - with violence if necessary - that discontent generated by the massive inequalities of wealth and power that markets create and to prevent the economy’s crisis tendencies from destroying the basis of accumulation. If you don’t like it, you have a problem with capitalism, not with the behavior of the government. Consider something different.

These are timeless truths for all market societies, but that doesn’t mean that capitalism always works exactly the same way. Far from it: capitalism is the most dynamic form of social organization - for both good and evil - that has ever been invented. Its periodic disasters and crises often require drastic changes to the process of accumulation, changes which then restructure the organization of society, power, and culture.

In The Condition of Postmodernity, David Harvey explains (pp. 119-197) that since World War II global capitalism has developed two separate “regimes of accumulation” - sets of rules and social relations that govern the operations of the economy. Emerging from the crisis of depression and war that nearly destroyed capitalism, the rulers of the economy had to make major concessions to save the system itself, leading to the economy-wide acceptance of Fordism. The Fordist economy was characterized by mutual restraint and cooperation on the part of both capital and labor - capital would provide stable jobs with good benefits and relatively low levels of abuse, and in exchange workers would accept the authoritarianism of the workplace and restrict their demands. The state oversaw the arrangement, maintained highly regulated domestic and international markets, and provided robust social insurance and collective services. Tied down by regulation, the finance sector retreated to unexciting tasks like taking deposits and making loans; making things rather than manipulating currency became the central focus of the economy, and large, cautious conglomerates became the most important players.

This arrangement provided high rates of growth and a stable basis for capitalist accumulation for 25 years. But in the end, the contradictions inherent in capitalism could not be overcome: the very productivity of Fordism doomed it as excess global capacity created by the full recovery of Deutschland/Germany and 日本/Japan and the industrialization of countries in Asia and Latin America ran up against the rigidities of the Fordist system. Combined with the oil shocks and the inflationary policies the USA pursued to address the emerging crisis, Fordism died a violent death. The stagflation of the 1970s, the severing of the dollar from gold, the collapse of the international system of fixed-rate currency exchanges, increasing diplomatic friction between the US and Japan - all flowed from the general crisis in the world economy.

To survive the crisis, business and the state joined forces to decimate the power of labor by attacking the unions and moving production wherever labor was highly repressed and exploited. The staid old conglomerates fared poorly, but smaller, more nimble companies forged ahead, pursuing new opportunities in technology, spectacle, and the exploitation of labor. The state’s role shifted from guaranteeing a stable and balanced (if still unequal) system to disciplining labor and tearing down the regulations inhibiting the flexibility that capital needed if it was to return to profitability. Freed at last, finance capital returned with a vengeance, and started down the path of reckless speculation that has culminated in the current crisis.

Harvey calls this new order “flexible accumulation”, and we can see its effects around the world in the neoliberal restructuring that has hit almost every country. Inequality has soared within societies as corporate executives and major investors - facing little resistance from devastated labor movements - have captured most of the increase in wealth. The government guarantee on basic human needs - education, healthcare, pensions, social insurance, public housing - has, where it existed, been eroded or eliminated. National boundaries have weakened, but in reaction to their weakening position many disadvantaged groups have turned to reactionary ideologies like religious fundamentalism and ethnic nationalism to organize resistance. Governments around the world, disciplined by the financial markets into austerity, have increasingly fallen behind on essential infrastructure investments and have failed utterly to address the impending climate crisis.

But all of that is irrelevant to capitalists - the important thing is whether they can continue making profits, and until the credit crisis there was no trouble on that score. But credit is the lifeblood of business, and unless the crisis eases up soon, even those whose business involves more than trading pieces of paper will have to seek new ways to survive. The question we confront is whether the shakeout will alter the ground rules that have sustained the neoliberal consensus, and how we might turn the situation to our advantage.

Progressive priorities for Chicago

The coming year will be pivotal for Chicago. The rest of the country will be focusing on the presidential election over the next couple months, but in Chicago the real action is elsewhere. Sure, an Obama victory might translate into greater resources for urban development, both because Obama is presumably more interested in tackling urban problems than the Cheney administration has been or McCain would be, and because Obama might pay back the favors he’s incurred during his years in Chicago’s political mire. And, of course, electing Obama would ensure that Chicago gets a presidential library at some point down the road.

But there’s not much Chicago can actually do to influence the outcome of the race. Obama will undoubtedly win Illinois, Durbin will undoubtedly win reelection to the Senate, only a couple members of the House are in danger of losing their seats, and the only important local race, for state’s attorney, will likely be won by Anita Alvarez, who’s busy integrating herself into the Chicago machine. (There is a Green Party candidate for state's attorney, Thomas O'Brien, for those repelled by Alvarez and her Republic opponent, Tony Peraica.)

But the election is still hugely important for Chicago and Illinois because the question of whether to call a state constitutional convention will be on the ballot. Every twenty years the citizens of Illinois can choose to rewrite the constitution, an option they declined the previous time they had the chance. This time we need to seize the opportunity.

Unbeknownst to most, the state constitution is one of the strongest obstacles to progressive change in Illinois. On all of the key short-term structural problems we face - a regressive tax structure, unequal school funding, pay-to-play corruption between business and political leaders - the constitution either silently accedes to the status quo or enshrines it in law. The General Assembly’s anemic attempts to address these problems have invariably failed.

If the constitutional convention passed, two delegates would be elected from each senate district to consider changes, and the outcome of their deliberations would be put before the voters for a yes-no vote. Ideally the new constitution would:

• Eliminate the flat income tax, which not only leaves the overall tax structure regressive once truly regressive taxes like the sales tax are added in, it also hamstrings the legislature in raising revenue, forcing it to consider socially-destructive options like expanding gambling;
  
• Mandate equal school funding, a necessary but not sufficient condition for overcoming the social devastation on the South and West Sides that is now spreading to some inner-ring suburbs;
  
• Reform the campaign finance system by switching to public funding along the lines of Maine and Arizona's clean election systems;
  
• Implement a nonpartisan redistricting process, similar to Iowa’s.

Of course to both write a progressive constitution and get it passed would require a major progressive mobilization to counter the status quo forces (especially big business) that are already working to nip the threat in the bud by defeating the referendum. That means major efforts will be needed to pass the constitutional convention in November, and sustained efforts to influence its outcome afterward.

Progressives not only have a once-in-a-decade chance to rewrite the ground rules of politics in Illinois, we also have a once-in-a-century chance to influence the distribution of resources that would flow to Chicago if Daley wins his bid for the 2016 Olympics. But the International Olympic Committee will make its decision in 2009 October and as Ben Joravsky points out in a must-read article, Daley will assuredly not be making concessions after that point, so we have to mobilize now to win the best deal we can.

One major demand should be converting the Metra Electric Line running thru the South Side to a new CTA line - the Gray Line, which I've written about here. Theoretically this shouldn’t be a difficult victory since it seems in line with Daley’s long-term plans and would address many of the transportation problems connecting Olympic venues. Even so, the plan still has no visible political support from the relevant agencies, Chicago-area politicians, or Daley himself.

But even as we push for the Gray Line, it’s important to keep sight of Daley’s goals: he’s seeking the Olympics as a way to dramatically accelerate the gentrification of the South Side. Already the South Loop has been completely transformed in the last decade with a frenzy of new luxury highrises being built; the neighborhoods of Kenwood and Oakland have been converted to lowrise condos for professionals; and the major public housing projects have been destroyed, scattering to the four corners all those people keeping down property values (well, actually only to the southern corners).

The Olympics would extend and deepen the transformation of the South Side thru the new Olympic Village housing on the site of Michael Reese Hospital, major improvements to public parks and infrastructure (including transit), and most important the indirect spur it would give to developers and housing costs - both of which can be counted on to drive out poor and working-class people.

As long as we have to live with the massive social inequalities that capitalism necessarily creates, it’s not entirely a bad thing to bring rich folks and professionals into poor neighborhoods - their wealth draws the commerce that would redline the ghetto and their political influence keeps up basic infrastructure. But left to itself gentrification will cleanse the neighborhood of all its original inhabitants, simply displacing the social catastrophe forced upon them to neighborhoods and suburbs further south.
That’s why we need to demand solid guarantees on affordable housing from Daley to balance his vision of gentrification and to make sure the Olympics bid increases equality instead of deepening it. Communities for an Equitable Olympics, a coalition of South Side community groups, has begun organizing to demand affordable housing and preference for locals in jobs and contracts related to the Olympics. We need to expand their base of support and help them increase the pressure on Daley.

Of course we have to remember that the constitutional convention, the Gray Line, and integrating affordable housing into the Olympic plans are only preliminary skirmishes in a much more protracted struggle to remake Chicago - to stop the progress of Daley’s efforts to build a gleaming city inhabited by professionals and cleansed of the poor, and create in its place an egalitarian and participatory Chicago.

Then and now: 150 years of exploitation

In the first volume of Das Kapital, Karl Marx quotes extensively from the reports of British factory commissioners, published in the 1850s and 1860s as part of the movement to regulate factories and reduce their worst abuses. It's instructive to compare some of these quotes with a recent article from The New York Times detailing conditions at the Agriprocessors meatpacking plant in Postville, Iowa revealed after a federal raid against the illegal immigrants working there. Lines from the British reports are in blockquotes, page numbers refer to the 1967 New World printing of the 1887 English translation and can be found here.

"Some [under-age workers] said they worked shifts of 12 hours or more, wielding razor-edged knives and saws to slice freshly killed beef. Some worked through the night, sometimes six nights a week."

At a rolling-mill where the proper hours were from 6 a.m. to 5 1/2 p.m., a boy worked about four nights every week till 8 1/2 p.m. at least . . . and this for six months. Another, at 9 years old, sometimes made three 12-hour shifts running, and, when 10, has made two days and two nights running. (247)

"a Guatemalan named Elmer L. who said he was 16 when he started working on the plant’s killing floors, said he worked 17-hour shifts, six days a week. In an affidavit, he said he was constantly tired and did not have time to do anything but work and sleep. 'I was very sad,' he said, 'and I felt like I was a slave.'"

J. Lightbourne: "Am 13 . . . We worked last winter till 9 (evening), and the winter before till 10. I used to cry with sore feet every night last winter." (236)

"Elmer L. said that he regularly worked 17 hours a day at the plant and was paid $7.25 an hour. He said he was not paid overtime consistently."

(On 270 workers under age 18 at match factories) "A range of the working-day from 12 to 14 or 15 hours, night-labour, irregular meal-times, meals for the most part taken in the very workrooms that are pestilent with phosphorus." (236)

"'My work was very hard, because they didn’t give me my breaks, and I wasn’t getting very much sleep,' [Elmer L.] said. 'They told us they were going to call immigration if we complained.'"

Maybe you've encountered people who still believe in the forward march of progress - it's a pretty strange notion in the face of evidence like this. True, there are some differences between America today and Britain 150 years ago - the management of Agriprocessors is more likely to be punished for these crimes than factory owners in Marx's time, and unlike 150 years ago, no one is willing to publicly claim that child labor, excessive hours, and dangerous factory conditions are fully justified.

Except this "progress" vanishes if you expand your view outside the United States. Conditions every bit as inhuman as those Marx analyzed are the norm in 中国/China and Việt Nam and many other countries, and the capitalists’ violent reaction to any attempt at limiting their abuses is also very similar. Opinion leaders ranging from Nicholas Kristof, who incessantly cloaks himself in the mantle of humanitarianism, to Thomas Friedman, who is the acknowledged master of explaining to business elites why everything they do is good, are every bit the match of 19th century apologists for massive inequality and shocking levels of exploitation.


It’s worth looking a bit more closely at Chinese capitalism, which at least in terms of labor relations has been functioning in a very pure form - exploiting the workers beyond their capacity to sustain themselves. Recently the state has begun making efforts to limit the natural operations of the market, implementing a new labor law that sets regulations on minimum wages, overtime pay, and freedom to fire workers, while opening new routes for workers to seek redress when their employers try to evade the law. The government is clearly concerned about the growing social instability borne of extreme exploitation, and at the same time is looking to manage a transition to higher-order production. So China won’t necessarily regret the departure of sweatshops if it can expand in more profitable sectors.

Chinese capitalists, however, share no such strategic vision of sustained and stable accumulation. This article chronicles the myriad ways they are seeking to eviscerate the new labor law:

"A lecture fee of 2300 yuan [over $300] for two days is definitely worthwhile - avoiding expenditures like overtime pay for the staff will bring profits more than a thousand times higher than the 2300 yuan fee," exclaimed business owner 王/Wang of 东莞/Dongwan at the "Strategies for enterprise managers to deal with the new Labor Contract Law" training session. . . . This kind of training already has a large market. . . . Labor law specialists and lawyers have come forward one after another to find loopholes in the law and provide confidential briefings to businesses.

The reporter then goes on to record the many techniques companies are using to evade the new labor law and squeeze greater profits out of their workers by swindling them on wages, overtime, and benefits. Exemplary cases include the factory that forced its workers to sign a contract written only in English, another that had its workers sign two separate contracts so they would work full-time in reality but part-time for legal purposes and thereby reduce overtime and benefits payments, and others that wrote out the terms of the contract illegibly or simply hid them with a piece of paper when they had the workers sign it.

Chinese capitalists also tell their side of the story - and a heartrending one it is. Businessmen are being hit from all sides: rising prices for raw materials, extraordinary wage increases mandated by the new labor law, a jump in lawsuits filed by workers under the law - all are subjecting these poor bosses to “increased pressures of management”. One maker of cellphone chips in 深圳/Shenzhen complains bitterly at being forced to raise his workers’ wages from 750 yuan/month (around $110) to 900 yuan ($130). The owner says that these workers, who will be making the fabulous sum of just over $1500/year working grueling shifts that in all likelihood span 6 days each week and 12 or more hours each day, will drive him out of business - unless (ominously) he can “think of a new way to deal with it.”

Some of these complaints are the completely predictable cries of outrage from the exploiters that always accompany any slight reduction in the rate of exploitation. Yet we shouldn’t just dismiss them out of hand - competition among the small enterprises of China is fierce, and a slight reduction in the exploitation of labor might drive some of these factories to the wall. Here again Marx is useful:

competition makes the immanent laws of capitalist production to be felt by each individual capitalist, as external coercive laws. It compels him to keep constantly extending his capital, in order to preserve it, but extend it he cannot, except by means of progressive accumulation. (555)

In other words, the brutal exploitation of labor is a product not of individual immorality, but the laws of the economy itself - the freer the market, the more desperate the plight of workers. It's as true in Iowa as it is in 广东/Guangdong, and it was as true 150 years ago as it is today.

The costs of China's development - and our Wal-Mart habit

From 新华社/Xinhua, this perverse boast:

China reduced the death toll from coal mine accidents by 24 percent to 1,631 in the first seven months, Huang Yi, deputy head of the State Administration of Coal Mine Safety, said on Saturday.

So after major safety improvements, China's ravenous appetite for energy - which in no small part is driven by the demand for cheap exports to the USA - devours almost 8 lives every day.

Anyone who has not already done so should make a point of seeing 盲井/Mángjǐng (Blind shaft), which is the best film about reform-era China that I've seen.

Are paranoia and Mongol-despotism part of the Russian character?

This article is worth reading on the conflict between Россия/Russia and საქართველო/Georgia. It's written by James Traub, someone as deep in the US foreign policy establishment as you can get.

On the one hand it provides good, even-handed background on the longrunning conflict between Russia and Georgia. On the other, it epitomizes the self-serving rationalizations that American leaders tell the public (and maybe even themselves) to justify their attempted takeover of the Russian empire while Russia lay prostrate from the free market blood-letting of the '90s.

Traub begins by condensing the complex history of Georgian nationalism into a couple paragraphs that miss the most important points: first, that until about a century ago there was no such thing as modern nationalism in Georgia (and even then it was a thoroughly elite affair); second, that the Советский Союз/Soviet Union itself played an enormous role in inventing nationalism in Georgia and all the other republics thru its nation-centered education, administration, and classification policies.

Traub then sets up Russia as an aggressive, paranoid bully:

The combination of Vladimir Putin’s reforms and the dizzying rise in the price of oil and gas have rapidly restored Russia to the status of world power. And Mr. Putin has harnessed that power in the service of aggressive nationalism. . . .
The “color revolutions” that swept across Ukraine, the Balkans and the Caucasus in the first years of the new century plainly unnerved Mr. Putin, who has denounced America’s policy of “democracy promotion” and stifled foreign organizations seeking to promote human rights in Russia. Georgia, with its open embrace of the West, thus represents a threat to the legitimacy of Russia’s authoritarian model. . . .
the fact that Russia views NATO’s eastward expansion as a threat to its security is a vivid sign of the deep-rooted cold war mentality of Mr. Putin and his circle.

First, Russia is not championing any kind of "authoritarian model" that Georgia's freedom and democracy imperils. Leaving aside Georgia's democratic credentials (Saakashvili violently put down large protests last year, and his "Western" economic policies have produced inequality and growing unrest), Russia could care less how it organizes its politics. The important issue for Russia - as it is for the USA and other imperialist powers - is whether Georgia acts in deference to it.

Now onto Путин/Putin's paranoia. If NATO is, as Traub claims, "no longer an anti-Soviet alliance", what is its purpose? Why does it keep expanding eastward, progressively absorbing more and more of the security zone Russia painstakingly erected after being invaded from the west twice in 25 years? NATO should have been shut down after the Soviet Union disintegrated, but its use as a seemingly multilateral framework for allowing the continued exercise of American power over Europe was too tempting. Russia was not the only target here - preventing any independent foreign policy orientation by the European Union was at least as important. But NATO's attack against Russian ally Serbia, its induction of ten former Soviet client states (including all of the strategically important Baltic states), and its flirtation with Georgia and Україна/Ukraine all demonstrate that Russian "paranoia" is solidly based in reality. If Russia started setting up military bases in Vancouver, Yucatán, and Santo Domingo, Traub might start to develop a similar level of paranoia.

Traub gives the game away when he writes, "For the West, the core issue is the survival of democratic, or at least independent, states along Russia’s frontier." None of this has anything to do with democracy, any more than the conflicts over Kosova or South Ossetia are related to the rights of minorities - except as a useful rhetorical device. As Traub admits, democracy is not the important thing, "independence" is. And he has in mind "independent" states like Georgia, i.e. those that accept hundreds of millions of dollars from the United States to equip and train their militaries and that send troops to Iraq in support of the American occupation.

Traub writes that the view of Russia as a congenitally aggressive behemoth intent on threatening its neighbors is now widely accepted:

People of all political persuasion now seem to get it about Russia. In “The Return of History and The End of Dreams,” Robert Kagan, the neoconservative foreign policy expert who is advising John McCain, writes of Mr. Putin and his coterie: “Their grand ambition is to undo the post-cold war settlement and to re-establish Russia as a dominant power in Eurasia.” Michael McFaul, a Russia expert at Stanford who is advising Barack Obama, also views Russia as a premodern, sphere-of-influence power. He attributes Russia’s hostility to further NATO expansion less to geostrategic calculations than to what he says is Mr. Putin’s cold war mentality.

Indeed, "all political persuasions" see Russia as the aggressor - from those who explicitly state their support for expanding American power to those who couch their support for expanding American power in soothing multilateral terms. And what on earth is a "premodern, sphere-of-influence power"? The sphere of influence, like the nation-state form around which it has been organized, is a preeminently modern invention. How long before we start hearing again the idea that Russian despotism is rooted in its culture, a product of its interaction with the Mongols 800 years ago?

Putin probably wishes he had the luxury of a Cold War mentality. During the Cold War, Russia maintained a stable of client states to protect itself, while the United States ranged across the rest of the globe, overthrowing unfriendly governments and equipping brutal militaries that agreed to accept its suzerainty. Now America has military allies and bases bordering Russia itself, and the economic collapse and deindustrialization that followed the end of the Soviet Union have left Russia with far fewer resources to defend itself. The real question is not why Russia perceives a threat from the USA, but how far the USA will go to defend those parts of the Russian empire it now controls.

America helps start another war

Anyone trying to figure out what the hell is going on between Россия/Russia and საქართველო/Georgia should immediately read this article from the World Socialist Web Site. Whatever you think of WSWS's politics, which can be both tiresomely dogmatic and very insightful, it's hard to deny that they often do a better job providing essential contextual information in their reporting than do America's so-called papers of record. And in this case, the WSWS also does a much better job simply reporting the facts, which are surprisingly muddled in The New York Times handling of the story.

The Times portrayal focuses on Russia's attack on Georgia, so it becomes very confusing when you read that Russian sources are emphasizing the number of civilians killed and Georgian sources downplaying the number of casualties. The resolution of the paradox is that the worst violence is being committed by Georgia against the separatist region of South Ossetia, and Russia has seized upon Georgia's attack against the region to teach Georgia a lesson. But these facts clash with the American insistence on seeing Georgia as an outpost of freedom and democracy standing up to tyrannical Russia. The Times is behaving like the controlled press of an authoritarian country, which can only produce a confusing mess when reporting news that doesn't fit the official line.

The other key aspect of the story WSWS includes that is completely effaced in mainstream reports is the prominent role the United States is playing in all of this. In The Times conception, the USA is merely a concerned neutral observer speaking out against violence. From WSWS we learn that it is the huge flow of American military aid and training that has made the Georgian assault against South Ossetia possible in the first place, and Georgia's president is now calling upon his military patron to intervene against Russia.

The Georgian president declared that his country was “looking with hope” to the US. The armed confrontation with Russia, he claimed, “is not about Georgia anymore. It’s about America, its values... America stands up for those freedom-loving nations and supports them. That’s what America is all about.”

Without letting Russia, itself an imperialist power, off the hook, I think American actions have to take the most blame for these developments. In response to the collapse of the Советский Союз/Soviet Union, the United States moved aggressively to privatize the economies of the Soviet successor states (with disastrous results for the people of those countries) and to establish as its own client states the defensive ring of countries Stalin had built after World War II. The war over Kosova, the quest for a missile defense system, the insistence on the Baku-Ceyhan pipeline for extracting Azerbaijani oil, using the war in Afghanistan to establish military bases in neighboring countries, the covert support for the Color Revolutions in former Soviet states - all must be seen as part of a campaign to isolate Russia and render it vulnerable to American power. Russia has, in fact, responded with surprising restraint to these provocations - but with the US-sponsored economic catastrophe seemingly in the past and oil wealth stimulating a (deeply unequal) recovery, Russia may no longer tolerating such bullying.

The state of China as the Olympics begin

United behind the spectacle, the nation, and the chance to buy stuff.

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I write this as the Olympics get under way in 北京/Beijing, and 中国/China begins its "coming-out party to the world". Thus far coverage in the American media has been execrable, dwelling almost exclusively on Beijing's pollution and the "rights violation" of not allowing foreign reporters access to a handful of English-language websites. Time has also been found, of course, to report on important issues like whether government restrictions would make the Olympics "no fun" for foreign visitors and the pole-dancing craze sweeping the world of bourgeois Chinese women's fitness. When articles touching on the key issues facing China today have appeared, like this one on the eviction of many of the workers whose labor has created the Beijing cityscape but who will never enjoy what they built, or this one on China's macroeconomic juggling act, they've been superficial and completely failed to capitalize on this unprecedented opportunity to educate Americans on China's complex reality.

It's hardly surprising, tho. Concentrating on individuals and ephemeral "events" that float ahistorically in the the present, at the expense of deep contextual or structural understanding, is precisely the model of mainstream journalism. Yet the media can do - and have done - a much better job than this. Witness the outstanding New York Times series a couple years ago on the massive social tensions among the winners and losers of China's reform era. At the time I summarized and expanded on these articles and also wrote a broader critique. These are worth going back and reading, because such structurally induced conflicts remain at the root of China's tense social situation.

The Western media's obsession with "human rights" (in their usage, little more than free speech and elections) has massively distorted their portrayal of the Chinese situation. As despicable as is the persecution of internet dissidents and the like, the most serious rights violations in China today are tied to the violence created by free market competition. Severe labor exploitation, repression of independent unions, inadequate access to healthcare, unequal access to schooling, expropriation of peasants' land for development schemes, subjection to horrific pollution - these are the pressing injustices in China, and they are all variations on the theme of class warfare.

The Western media, having served as continuous cheerleader for market reforms over the course of three decades, is constitutionally incapable of recognizing this. Instead, severe class tensions are absorbed within the fatuous formulation of a "liberalizing economy alongside and an authoritarian polity". American writers evince no end of bewilderment at such a paradox. Yet if they examined the history of the last two hundred years, they might discover that in each and every case harsh authoritarianism has accompanied the early stages of capitalist accumulation. Workers do not quietly accept being dominated, at least not until relentless repression and the lure of consumerism work their magic.

To cope with these increasingly stark social contradictions, the Chinese state and its allies in the emerging capitalist class have resorted to an old formula: channel popular anxiety and rage into passions that unite those with power and those without it. For the moment, xenophobic nationalism and a putative shared culture - the most powerful examples used by many ruling elites over the last two centuries - are actually being given a relatively low profile in these efforts. Right now, none other than the Olympics is the focus of attempts to repress class conflict. The Olympics serves first as spectacle, a latter-day bread and circuses. Second, it has been promoted with almost messianic enthusiasm as a symbol of China's rise. Every citizen has been encouraged to take pride in the nation, as China's leaders have obsessively sought out whatever amenities (fancy hotels, striking buildings, immaculate toilets) are thought to command respect in the international realm. Finally, the Olympics are the focus of that other great desire that unites the entire nation - endless accelerating consumption.

How the quest to avoid class conflict will proceed after the Olympics is a hugely important question, for Chinese culture, politics, and international relations alike. The fleeting unity forged by the Olympics may be sorely tested in the next year or two if the rich countries sink into prolonged recession, causing China's export markets to contract and unemployment to rise. Yet aggressive nationalism probably cannot provide immediately relief - China has staked its international reputation (in striking contrast to the United States) on a "peaceful rise", and the ideological groundwork for a more muscular imperialism has yet to be laid.

If unrest starts to increase, the state will probably make tactical concessions, and may even start the shift from export-oriented development to concentrating on developing the internal market. Fortunately for Chinese capitalism, the state retains a powerful role in the economy and can respond far more rationally - in the interests of capitalists as a class - than would individual capitalists, who would no doubt prefer ever more brutal repression. The victims of the market have little capacity to produce something more radical - they remain extremely fragmented and the only group that might overcome this, the intellectuals, still fear them more than the state. Thus far, protesters have only infrequently turned to the rich history of revolutionary China as a resource in challenging the radical inequalities that have emerged in the reform period. But if the intellectuals find their social position deteriorating and some join the popular movement, this history could become a powerful weapon against the Chinese "Communist" Party and its capitalist running dogs.

Gray Line debate

I've been defending the Gray Line proposal in comments over at CTA Tattler, under the unlikely headline of Radiohead represents the CTA. Check it out and see what you think.

How should we fight meat?

The arguments against meat are overwhelming: the suffering imposed on the animals is unconscionable and the unnecessary killing of animals is ethically indefensible; there is no difference between pets and livestock that could possibly justify laws against cruelty to the one while industrialized horrors are committed against the other; meat is one of the main causes of global warming, air pollution, and the destruction of waterways, not to mention a colossal waste of resources; the production of meat is a major factor in the global food crisis, already causing widespread hunger and threatening large-scale violence if nothing is done.

Fighting meat is one of the most urgent issues we face - the crises in energy, food, and climate are deeply connected and are leading directly to a far more dangerous and impoverished world. Most urgent of all, every moment the number of innocent animals born to suffer horribly and then be killed without need is increasing. The OECD predicts a tragic 26 percent increase in meat consumption in developing countries alone over the next decade (The Wall Street Journal, 2008 August 1, “Brazilian Beef Clan Goes Global As Troubles Hit Market”).

Perhaps the arguments against meat are not convincing to right-wingers, who revel in their own selfishness, staunchly defend their right to take their pleasure at the expense of others, and delight in a violent masculinity. Yet most liberals and radicals eat meat as well, and many vegetarians eventually go back to eating meat. Despite the increasing awareness of the horrors of factory farms and the connection between meat production and both global warming and the food crisis, the percentage of Americans who are strict vegetarians remains a stagnant three percent, while the media continue to marginalize vegetarianism as a viable solution to the ethical and environmental devastation produced by meat (for the latest example, see this Chicago Tribune article, which explores every technological fix imaginable to the methane emissions of livestock while ignoring the obvious possibility of reducing or eliminating demand).

How are we to explain this? To a certain extent it’s simply ignorance - while the media have very tentatively begun to discuss meat’s connection to climate change, still only a handful of articles have been published since the news blackout started to crumble. Neither has the connection to the global food crisis captured much attention. Op-ed and editorial writers focus much anger on ethanol subsidies - a line of argument in keeping with their free-market principles - but ignore the massive inefficiency of producing crops to feed to animals, which is equally at fault for straining food supplies. Instead, the extremely high levels of meat consumption in the rich world and rapidly rising levels in 中国/China, India, and Brasil are treated as a force of nature.

If lack of information plays a part, willful ignorance may be just as big a factor. Many people are vaguely aware that the conditions at factory farms are unacceptable, but resolutely avoid exposing themselves to the many available online resources so that they can bury their guilt and keep eating meat. And even those people who feel bad about the industrialized torture of animals are perfectly comfortable with killing and eating animals if they don’t suffer. This line of thinking remains a fascinating mystery to me. Who would ever say that killing a human for pleasure is okay if it’s done painlessly? The animal itself wants to keep living at least as much as it wants to avoid pain - in supporting “humane” slaughter, whose feelings are we really protecting?

What we’re dealing with is more complicated than simply a lazy hypocrisy sustained by the old “meat tastes good” so-called argument. The fact of the matter is that human supremacy over other animals and the eating of meat is a deep-seated and intimate component of most people’s identities. How else can we understand the surprisingly defensive reaction that many people have when the subject is raised? Like racism, male chauvinism, xenophobia, antigay feelings, and other supremacies, domination over animals is both “common sense” until it meets strong organized resistance, and impossible to overcome simply thru the liberal remedy of “education”. A new culture and widely-shared identity must be forged that explicitly rejects human supremacy if the antimeat movement is to succeed.

Knowing all this, what are we supposed to do? I tried to start a conversation here and failed - the discussion here was more successful but came to no solid conclusions. Kyle’s suggestion to make common cause with other progressive issues is a good one, but the meat issue seems uniquely resistant to such an approach. For many people human supremacy is the ground upon which progressive politics are based - witness the vitriolic reaction that met PETA’s comparison of the livestock industry to the slave trade.

The obvious exception is on global warming and other environmental issues. Mainstream environmental groups have thus far been incredibly cautious on the livestock connection and refuse to even raise the issue, so putting pressure on them to discuss all the factors behind climate change is one direction forward. The food crisis is another potential line of attack, especially as high food prices increasingly hurt poor Americans, but seems to have drawn little attention so far amongst progressives.

Popular education efforts calling attention to meat's role in climate change and the food crisis are another possibility. Most people associate opposition to the killing of animals with marginalized subcultures like hippies or new age practitioners, and are unwilling to confront the fact that their eating habits are responsible for horrific animal cruelty, so framing the issue as a crisis of environmental sustainability and food security gives us a major new line of attack in raising the issue. Pamphleting during lunchtime or holding protests about the negative consequences for people of meat production is probably the most effective way of communicating with the vast majority of the population that doesn't even think twice about human supremacy. Once someone has changed enough to become vegetarian, considering the ethics of dominating animals is made far easier.

Another important target is the media. Generally reporters won’t cover anything that politicians avoid, so it will take public pressure and high-profile protests to force meat onto the public agenda. Every reporter who ignores reducing or eliminating meat-eating as a solution to these problems should be met with a barrage of emails demanding an exploration of all sides (that Tribune reporter's email address is mhawthorne@tribune.com). And reporters specializing in climate change should be constantly reminded that the livestock industry produces more greenhouse gases than the transportation sector (on the blog of New York Times environment reporter Andy Revkin (anrevk@nytimes.com), which focuses mainly on global warming, the livestock industry’s role in the crisis has not been covered once, and The New York Times has yet to publish a news article on the issue). We should also make a point to contact the editors who aren’t assigning reporters to investigative efforts that might help us understand why runoff from factory farms keeps killing people who eat vegetables, why the brutality against animals in slaughterhouses is so often mirrored by brutality against the workers there, and how factory farms have driven a complete reorganization of the agricultural economy over the last generation (this page lists editorial contacts at The Times - and don't forget to include the public editor, whose job is to provide oversight at the paper).

In some states, the best way to raise the meat issue is thru popular referenda. The run-up to a vote allows public discussion of the issues - which can range far beyond the ballot proposal and play an important role in educating the public and challenging widely-accepted ideas on the human relationship with other animals. A proposition (Prop 2) to ban tiny cages for chickens, pigs, and calves is on the California ballot this November. This is a hugely important referendum to win - both to reduce animal suffering and to energize the movement in the rest of the country. If you live in California, you should consider becoming active in the fight to pass the measure; if not, talk to any friends or relatives living in California.

Finally, we should consider using the emotional appeals that exist comfortably within the discourse of human supremacy but may be most effective at reaching people who have been taught their entire life no other way of thinking. Nicholas Kristof’s most recent column may express his own rank hypocrisy in recognizing the intelligence and individuality of farm animals while continuing to kill and eat them. Yet it also makes one of the most powerful appeals for compassion that I’ve read. Many a meat-eater might think twice after reading something like this.

I’m a farm boy who grew up here in the hills outside Yamhill, Ore., raising sheep for my F.F.A. and 4-H projects. At various times, my family also raised modest numbers of pigs, cattle, goats, chickens and geese, although they were never tightly confined.

Our cattle, sheep, chickens and goats certainly had individual personalities, but not such interesting ones that it bothered me that they might end up in a stew. Pigs were more troubling because of their unforgettable characters and obvious intelligence. To this day, when tucking into a pork chop, I always feel as if it is my intellectual equal.

Then there were the geese, the most admirable creatures I’ve ever met. We raised Chinese white geese, a common breed, and they have distinctive personalities. They mate for life and adhere to family values that would shame most of those who dine on them.

While one of our geese was sitting on her eggs, her gander would go out foraging for food — and if he found some delicacy, he would rush back to give it to his mate. Sometimes I would offer males a dish of corn to fatten them up — but it was impossible, for they would take it all home to their true loves.

Once a month or so, we would slaughter the geese. When I was 10 years old, my job was to lock the geese in the barn and then rush and grab one. Then I would take it out and hold it by its wings on the chopping block while my Dad or someone else swung the ax.

The 150 geese knew that something dreadful was happening and would cower in a far corner of the barn, and run away in terror as I approached. Then I would grab one and carry it away as it screeched and struggled in my arms.

Very often, one goose would bravely step away from the panicked flock and walk tremulously toward me. It would be the mate of the one I had caught, male or female, and it would step right up to me, protesting pitifully. It would be frightened out of its wits, but still determined to stand with and comfort its lover.

Those are some ideas, but they're not really that satisfying against a problem so enormous and pressing. Any other thoughts?

Economic foundations of the coming US-China conflict

This is an interesting piece of news I wasn't aware of, which strengthens my argument against the idea that Sino-US trade links will prevent a new superpower conflict (from The Wall Street Journal Asia, 2008 July 31):

[In March 2007] the Bush administration reversed a two-decade-old policy that prevented U.S. companies from seeking protection against unfair government subsidies of goods produced in "nonmarket" - usually communist - economies. For years, the limit effectively shielded China from such complaints.

. . . the number of complaints filed under U.S. law has soared. In 2006, American companies filed five complaints similar to those pursued by [steel tube manufacturer] Wheatland, alleging unfair pricing, government subsidies - or both. In 2007, complaints jumped to 20. So far this year, 13 such cases have been filed.

Since the Carter administration, US presidents have consistently ignored 中国/China's "trade-distorting" advantages, like government subsidies, cheap repressed labor, or a fixed undervalued currency. That's because every president has sided with multinational businesses, which not only had a long-term vision of gaining access to the enormous China market but themselves benefited from China's trade advantages as they shifted production from unionized American factories to Chinese sweatshops in low-tax free trade zones.

The Cheney administration has by no means reversed this policy, but its increasing openness to the protectionist demands of smaller domestic capitalists and more aggressive approach to trade disputes (seen in the first WTO ruling against China a couple weeks ago) are revealing. And the room for trade conflicts is only going to grow. The seven-year-old Doha round of trade liberalization talks collapsed on Tuesday as China, for the first time, made a high-profile rejection of the American "free" trade agenda. As China continues to climb the value chain, it will start to threaten an increasing number of American businesses at the same time that Chinese businesses, with quiet support from their government, squeeze American companies out of the China market.

Meanwhile, perhaps the most explosive economic dispute - access to resources - continues to develop underneath the surface. China has been extremely aggressive over the last five years in securing long-term rights to raw materials across the globe (these articles cover China's activities in Africa, but it has been active from Myanmar and Indonesia to Brasil and Argentina as well). This poses no immediate threat to the United States, but in the long run Chinese and American capitalists might find themselves running up against each other in the search for production inputs, impelling their two governments to fight for control over conflicting neocolonial claims. And of course the issue of control over oil supplies will loom increasingly large unless some breakthru is made in energy technology or oil extraction.

The best way to conceptualize the emerging conflict may be to interpret China and the USA's diverging interests as an unavoidable contradiction within capitalism itself. To survive, capital must constantly expand; failure to do so leads to crisis, as even mainstream economists will admit. For the last thirty years, this expansionary process has proceeded with remarkably little resistance as obstacles like revolutionary movements and organized labor were brutally destroyed and vast new markets (China chief among them) were opened to the movement of capital. But this expansionary phase may be coming to an end as profitable new opportunities diminish and raw materials become more scarce.

If capital requires the ability to range freely across the globe in search of new opportunities, it must also remain rooted geopolitically to a certain extent. It cannot thrive without the regulatory environment provided by the state, and when it runs into insuperable obstacles it turns to the state to clear the way. Thus distinct groups of nationally based capitalists emerge, and can coexist in harmony as long as raw materials and exploitable labor are abundant. But when those essential inputs become scarce, businesses may demand their state take action to protect their supplies. Unfortunately, as we saw in the Great Depression, erecting autarkic economic blocs may secure the conditions of accumulation in the very short term, but it simply aggravates the situation in the long term by restricting capital's freedom of movement and further constraining its options for profitable deployment. The crisis of the 1930s was ended only by the massive destruction of World War II, which eliminated all of the rivals to American capital and provided fabulous new investment opportunities in the guise of reconstruction contracts.

World war is certainly not the only way to resolve these contradictions - the last major crisis in the global economic system, the stagflation of the 1970s, unfolded very differently. And economic tensions between the USA and China are only now beginning to emerge, so it will be some time before open conflict can develop. But don't discount the possibility too quickly. Those of us 30 years and younger have never experienced global capitalism in crisis or major challenges to American hegemony, so it might be easy to imagine that "globalization" or "interdependence" or some other slogan has superseded the kinds of global conflict that defined the years 1914 to 1989. But it's worth remembering that capitalism today is more similar to the capitalism that preceded the Great Depression than any other time since.

How i-bankers' foul-ups turn into recessions

I hope to write more in the next couple weeks about the growing economic crisis, but for now I just want to point out this article: Worried Banks Sharply Reduce Business Loans. This is how a disaster in the financial sector gets transformed into a disaster for the entire economy.

Up until now the collapse of the housing bubble, which had been inflated thru an incredibly complex trade in mortgage-backed securities and other forms of glorified gambling in the financial sector, has mainly hurt the banks themselves, those they tricked into taking out loans they couldn't afford, and the thousands of eager young private college graduates who had been dreaming of a job in arbitrage or securities for the last four years. If you haven't been following the news closely, you might not even be aware that the entire financial system came perilously close to complete collapse, and has been saved only by the major and repeated interventions of the US government and huge capital injections from the investment funds of foreign governments. But now we're moving into that part of every capitalism-induced crisis where problems in the credit markets infect the real economy - that part where people make things and serve human needs rather than trading in fictitious capital.

Businesses rely on bank credit for everything from everyday expenses to investments in the expansion of production. When that credit dries up, they have to forgo expansion, fire people, or even go out of business. Even those businesses that can still get loans have to pay higher interest rates. What constrains or destroys one business inevitably has an impact on the whole supply chain. In the same way, consumers find it harder to borrow for big purchases, further reducing effective demand. This is what the American economy is now facing.

Earlier this year, credit extended by banks to companies and consumers was still growing at double-digit rates compared with three months earlier, according to an analysis of Federal Reserve data by Goldman Sachs. By mid-June, bank credit was declining at an annualized pace of more than 6 percent.

The liquidity crisis arises from the fundamental laws of capitalism: at the end of every speculative expansion, all loans become suspect as banks must rapidly increase their capital base to cover their losses in the markets. People interviewed in the article talk as if bankers are behaving irrationally in denying loans to solid businesses. But this pattern has been well-established for several hundred years, and even mainstream economists will tell you it's built into the business cycle. Massive irrationality is certainly present, but at a much more profound level than the decisions of an individual loan officer.

Add the emerging credit crisis to rising costs for food and energy, the big drop in state and municipal spending that will unfold over the next few months, and the possibility of some spectacular failure in the financial sector, and we have the worst economic crisis in a generation. It's hardly a surprise - capitalism produces these kinds of crises every thirty or forty years. The interesting question is whether the crisis will reshape the basis of capitalist accumulation, and with it all the economic, political, and cultural formations that are based upon it.

The betrayal of Chicago public housing

All Chicagoans should read this article, and so should anyone else interested in fundamental urban problems. Skeptics on the left and public housing tenants themselves suspected from the beginning that Daley and the Chicago Housing Authority's Plan for Transformation - which ostensibly was going to replace the concentrated poverty of highrise public housing with the harmonious integration of mixed-income walk-up developments - was actually meant to disperse the poor and seize the valuable real estate they occupied. As the progress of the Plan for Transformation makes clear, these fears were all too well-founded.

Nine years into what was supposed to be a 10-year project, the CHA has had no trouble destroying 13,000 units of housing, breaking up the tenants' communities and forcing them to move further south into neighborhoods just as bad as the ones they left. (The wait list for public housing, which was closed to new applicants in 2001, stands at 56,000.) The CHA also had no difficulty giving developers close to Daley a wide variety of sweetheart deals on the razed properties, from selling the land once occupied by Stateway Gardens for $1 to dispensing heavily subsidized building contracts and lucrative retail concessions.

What CHA has had problems with is actually building homes for the thousands of displaced public housing tenants. Only 30 percent of the planned units have been built, and half of those were completed before the plan officially started, while the CHA was under federal supervision.

These problems could have been avoided if that single success had been made the model of the whole program. Henry Horner Homes on the West Side was torn down and rebuilt in phases, so that residents could stay on site and move into the new apartments as they became available. But it was only the organizing efforts of the residents themselves and federal oversight that forced CHA to follow this model. Once CHA, whose history is shot thru with negligence and racism, again had the upper hand it gave priority to destroying public housing communities and getting tenants off the land over replacing their homes. (Incidentally, Valerie Jarrett, one of Obama's close advisers and former top Daley official, has had a major hand in this housing disaster.)

If the city were serious about creating communities integrated along race and class lines, it would not only devote more attention to creating public housing than channeling profits to developers - it would require all new developments to include a real mix of affordable or public housing. The unspoken flaw in the Plan for Transformation all along has been the fact that rich people and professionals don't want to live near poor people, especially if they're black. Even if it hadn't been for the delays and cost overruns wrought by corruption and the implosion of the American property market, the CHA's new developments would have been a tough sell for Chicago's privileged. The only way to get around that would be to level the playing field by integrating the entire city instead of only pockets on the South Side.

Of course, residents of Lincoln Park or Streeterville would riot if poor people started moving in next door, and Daley isn't about to offend his most powerful constituency. But forcing Chicago's elites to permit enough affordable housing is more urgent than ever.

The rising price of gas and the transition to a low-carbon society will cause a massive movement of population back into the city in the next couple decades. This is a wonderful prospect, as America is finally on the cusp of reducing its unsustainable suburban expansion. But if market forces are left to operate freely, the cost of housing in the city - especially that near the Loop and convenient to transit - will skyrocket and force all but professionals and the rich to the outskirts of the city and the near suburbs. The movement of poor minorities into some south and west suburbs is already quite striking. If anything, the revival of the city will actually make these people's lives worse because they will be even more remote from good jobs and educational opportunities.

Of course even if the Plan for Transformation's rhetoric had been faithfully pursued, integration thru housing would remain a reformist measure, meant to mitigate the devastating effects of social inequality rather than to root it out. But as two generations of experience with the post-Brown v. Board ghetto has shown, the social deterioration caused by joblessness, lack of services, and crime thoroughly frustrates the revolutionary potential we might assume large concentrations of poverty would have. Integration seems like a good goal, but only if it is used to facilitate more effective organizing against the social structures that produce such massive inequalities in the first place.

The 20th century's record on rising powers: Two world wars and the Cold War. How will the 21st century turn out?

The question has been raised in the comments whether there’s any chance at all that 中国/China and the USA will move toward conflict. As everyone knows, bourgeois democracy is dominated by commercial elites, and the most powerful American companies all support engagement over containment. The progress of the debate over granting China permanent “normal trade relations” in 2000 provides a lot of support for the idea. Commercial interests, piously cloaking themselves in the crackpot idea that expanded trade would cause political liberalization, steamrolled human rights, labor, and security concerns.

Yet American elites are far more divided on how to approach China than the relative calm in the media would seem to indicate. Certainly the dominant faction, based in multinational industrial and finance capital, wants to avoid confrontation so as to continue exploiting Chinese labor and taking advantage of China's weak environmental regulations. But an insistent minority based in the security bureaucracy and domestic industry view China as America's most important enemy. And that minority is likely to gain strength as China does.

You can see hints of the “China threat” group in the widespread Congressional criticism of China's exchange rate policies and the outburst that killed the 中海油/CNOOC offer on Unocal in 2006. For a better idea of these people’s solid presence in the halls of power, just skim thru some of the testimony and reports of the Congressionally mandated US-China Economic and Security Review Commission, which every year warns about the growing threat from China. Support for anti-China policies is already quite deep, if not yet very broad.

It'll be interesting to see the military/small capitalist faction battle it out with the big capitalist faction - it's not a conflict that too often makes it into the light of day. Right now the engagement group has the upper hand - altho Cheney, like Clinton before him, has been quietly encircling China with military bases even as the US speaks the language of trade and cooperation. There are two things that make me worry about long-term conflict. First, any sudden crisis (over 台湾/Taiwan, say) would immediately destroy all the leverage of the accommodationists. And we shouldn’t kid ourselves - the United States will go to war to deny Taiwan to China.

Second, US economic interests in China will probably start to decline relatively soon. The Chinese government only tolerates foreign investment because it needs the capital and access to technology. China is fast catching up on technology, and if the Chinese economy can make the transition from export-led growth to sustained growth driven by domestic consumption - which I think it will - American companies will find a less inviting market. Those companies might leave on their own anyway, in search of even cheaper labor - many are already starting to move to Việt Nam.

Just think about the anti-Japan panic of the early '90s - a nearly hysterical fear gripped the whole country before the bursting of the bubble economy abruptly ended the Japan "threat". Now consider what's going to happen when China starts to pose strong competition not only economically, but in diplomatic and military affairs as well.

On the Chinese side as well, there are strong pressures toward confrontation. Popular nationalism is so strong that the government would have to take a hard line on any international crisis - especially over Taiwan - even if it didn’t want to. Chinese people themselves have almost no awareness that their country is rapidly assuming the role of imperialist power, and even less of a critical stance toward that fact. Nor do they understand the colonial character of Chinese policy in Tibet (西藏/Xizang) and شەرقىي تۈركىستان/Sherqiy Türkistan (新疆/Xinjiang), and they interpret international criticism of those crimes as a form of aggression.

Most important, China is in the midst of a capitalist revolution, which necessarily creates massive inequalities and constant cultural instability. For many people, the anxieties created by this process will be displaced onto the international sphere, and a reactionary nationalism will fill the void of ideology and provide an anchor in the turmoil wrought by commodification. For elites, nationalism is a useful direction to channel popular grievances into, and popular support for imperialism will soon enough become a necessary condition for expanding profitability.

So for the moment, capitalism prevents conflict - but in the long run it will probably require it. Maybe this time the USA will deal better with a rising power than it did with the Soviet Union after the war, or than Britain did with rising Germany in the early 20th century. But I doubt it.

Chinese spies are everywhere!

This is a disturbing article from The New York Times. Essentially a scare-piece written as if to drum up paranoia against Chinese Americans and Chinese living in the United States, it largely relies on Joel F Brenner, the government's leader of counterintelligence, for the conclusion that China is pursuing an "orchestrated, deeply thought-out, strategic campaign" to steal American national security secrets and conduct industrial espionage.

The reporter suggests that American "authorities have reason to be more suspicious of Chinese researchers and students", as well as citizens of Chinese descent, whose "ethnic loyalty" is leading them to betray the United States. Brenner's claims as to the threat of Chinese spying should be taken especially seriously because of his deep understanding of the Chinese Mind. For example, in discussing the case of a Chinese-born engineer and "sleeper agent" who was convicted of selling China naval secrets after working his way up in the weapons industry, Brenner notes that this "bespeaks a patience that the Chinese are especially good at."

Perhaps Brenner was concerned that the reporter might miss his obvious Orientalism, because he goes on to illustrate China's strategy of collecting pieces of information to get a larger picture by saying, "You can get to know the dragon by its claw".

Our intrepid reporter does not provide any reason to think that the crafty Oriental who sold naval secrets was in fact a "sleeper agent" rather than someone who was contacted by the Chinese government after he reached a position that would make him useful. We do learn, however, that this threat to our national security will be jailed for 24 years - a fitting punishment for selling information that "was not classified, . . . although it was illegal to provide it to China." (In another case discussed in the article, a white man convicted of selling real secrets received a sentence of less than 5 years.)

Okay, so we have intelligence officials who learned about China primarily from 1930s movies, we have inscrutable yellow hordes infiltrating our society - but what do the Chinese want? According to Brenner, "China is especially interested in improving its naval capability against any threat from the United States and obtaining intelligence that might be important in a military confrontation in the Taiwan Strait." In addition to government-directed spying, commercial trade secrets have also been targeted.

In other words, Chinese government spying is directed primarily at countering the threat of an American attack - it is completely defensive and does not threaten the United States in any way (America's imperial interests are, of course, another story). Chinese companies are mainly interested in getting access to advanced technology, which American companies hold monopoly over by virtue the US head-start in industrialism. And yet Brenner would have us believe we face a rising threat from China to our national security, and his mouthpiece at The Times - by excluding the possibility that American counterintelligence is protecting secrets that have no right to be kept - concurs.

The real threat China poses is to the military and economic hegemony that the USA exercises over the entire world. And barring a catastrophic economic crisis in China, that threat is only going to increase. With this rising danger to American supremacy, we can expect increased fear-mongering against China and against those of Chinese descent in the United States. We must be on guard against this kind of agitation, both to prevent racial profiling and to prevent getting sucked into a new cold - or hot - war in Asia.

Bomb bomb bomb, bomb bomb Myanmar

There's certainly nothing wrong in contrasting the massive amounts of money that Myanmar's government spent on its new showcase capital with the visible poverty surrounding it and with the staggering social needs ignored by the government. I just wish Americans were as sensitive to the similar contrasts easily seen in our own capital, or to the American government's similarly consistent preference (ie predating Bush II by many decades) for military spending over spending to help the impoverished.

It's also interesting that the reporter casts the Myanmar military's suspicion of a foreign invasion as irrational paranoia - proving the point by quoting an eminently objective source, the US government's representative in Yangon. Yet not two months ago Robert Kaplan, a prominent foreign policy intellectual, published an op-ed in America's most prominent newspaper calling for the invasion of Myanmar. Now where could Myanmar's paranoia be coming from?

Not that I would object to one of the world's worst regimes being overthrown. But as with the overthrow of Saddam Hussein's government, the fact that the real reasons behind an American invasion have nothing to do with helping the victims of the regime would once again lead to a disastrous occupation.

Why do powerful Americans periodically call for an invasion of Myanmar? Because it is one of the few countries left in the world that does not acknowledge American suzerainty, and - most important - it is a vital strategic asset for 中国/China. Surrounded on all sides by reliable American client states and massive American military bases, China has cultivated Myanmar as a source of raw materials and a base for projecting its power into the Indian Ocean. Toppling the Myanmar government and installing a puppet regime would complete the US cordon sanitaire around China and secure the interest of burgeoning client state India in establishing its preeminent position in the Indian Ocean.

It's a measure of how thoroughly Cheney's adventures in the Middle East have distracted his administration from larger threats that an attack on Iran is gathering steam while Kaplan's proposal was ignored. Iran poses absolutely no danger to the United States, and very little danger to US imperial interests. China, on the other hand, could very well some day seize hegemony over what is emerging as the economic center of the world, East Asia. Of course Cheney's plan to consolidate American control over the world's oil supply is in large part aimed at establishing permanent leverage over China, but to allow an obsession with Iran to distract to from the more pressing task of containing China's geopolitical reach is a remarkable strategic failure.