In 1935 United States Marine Corps Major General and two time Medal of Honor recipient Smedley D. Butler delivered his landmark speech, War is a Racket. During which he posited that war was “possibly the oldest, easily the most profitable [and] surely the most viscous” racket of them all. But if there is a war, who has ordered our men and women to wage it? Politics both precedes war as a racket and rivals its profitability and perversion.
While it is the case that many politicians and their donors have been enriched beyond their wildest dreams through the racket of war, our public servants are quite eclectic in their methods for personal enrichment. In an oligarchic democracy, the opulent rule not by direct intervention-though that is sometimes the case-but by creating a system where survival is predicated on access to steady streams of capital of which they hold the lock and key. Politicians either conform to the politics of personal profit, or are quickly ousted from Capital Hill.
In a country predicated on protecting the interests of the opulent, it is no surprise that the ethic of enrichment is pervasive amongst those who execute the functions of government. Central to maintaining power and thus the wealth that comes from it, is maintaining a military. As Butler illustrated in his speech and subsequent book by the same name, there are plenty of ways to further financial and militaristic interests, simultaneously, and often those interests are one and the same. In the political debates proceeding the founding of our nation it was argued by James Madison in the Federalist Papers (A series of essays in which Madison and Alexander Hamilton argue for the ratification of the United States Constitution) that the government “ought to be so constituted as to protect the minority of the opulent against the majority.” And who better to defend the interests of the wealthy than themselves?
America has a long-trodden history of being governed by the affluent elite, during the post revolution it was our so called “founding fathers”, better described as aristocrats dead set against paying taxes to a palace overseas. During the time of Smedley Butler, it was the Andrew Mellon’s and Herbert Hoover’s pulling the political levers of profit, now they are pulled by Steve Mnuchin and Donald Trump. The patrician class has spent nearly a quarter of a millenium perfecting their racket of politics by instituting legislation that ensures our representative democracy dramatically over-represents the interests of the wealthy.
A study from Quartz found that the median net worth of a member of the US Congress in 2015 was north of 1.1 million dollars, with the net worth of the median net worth of a senator coming in at a whopping $3.2 million dollars as opposed to the $900,000 dollar median in the House. Making the Congressional median net worth more than 10 times higher than that of the median American net worth, of $97,000. And of course we needn’t look to history for examples of this rank profiteering from office
Recently, Republican Senator Richard Burr, who garnered national attention and a good bit of positive press from the Blue Dog media after indulging them throughout the red-baiting farce of Russiagate, was recently thrust back into the news cycle. This time the result of audio leaked to NPR from a private country club luncheon on Feb. 27 where Burr explained “there’s one thing that I can tell you about this: It is much more aggressive in its transmission than anything that we have seen in recent history.”
In public however, his demeanor was much more reassuring “Luckily, we have a framework in place that has put us in a better position than any other country to respond to a public health threat, like the coronavirus” he said in a statement nearly a month after offloading massive amounts of stock. In March of this year, ProPublica reported that Senator Burr “sold off a significant percentage of his stocks shortly before the market declined, unloading between $628,000 and $1.72 million of his holdings on Feb 13th in thirty-three separate transactions.”
It was then later reported that Senator Burr’s brother-in-law, who sat on the National Mediation Board had also been unloading massive amounts of stock options during the same window of time. 3 months news broke from the Los Angeles Times that federal agents had obtained a search warrant for Burr’s personal cell phone and icloud account in an open investigation into whether or not he had profited off of privileged information, a violation of the Obama era Stock Act regulation that prevents congress from using government intelligence they receive for financial gain (Burr was one of only 3 senators to oppose the bill).
It is important to note however, that he is being investigated specifically for insider trading, not for misleading the public in a time of crisis or even for profiting off of the pandemic itself while holding political power. But because he executed the trades specifically while receiving daily private briefings on the looming threat of the virus. Senator Burr is also not the only elected official to come under fire for profiting from the pandemic, Senators Dianne Fienstein (D) and Kelly Loeffler (R) also drew criticism for offloading stocks following an all senate meeting discussing the threat of the virus.
In the same way a fish would ask, “What is water?” A politician asks, “What is corruption?” It is often most difficult to see that which we are steeped in. It is what allows politicians to blithely ask, “If Washington is corrupt, who are the corrupt politicians? Point them out.” As Mitch McConnel has done before. In many cases the people pointed to will be the Richard Burr’s on the Hill, who’s blatant personal enrichment in a time of crisis, an action even Fox News pundit Tucker Carlson skewered Burr for, saying unequivocally that he was “betraying [his] country” during the pandemic.
Little was made however of the heist that was occurring before our very eyes, with the support of Nancy Pelosi, Elizabeth Warren, and even Bernie Sanders when they delivered what is perhaps the single greatest upward transfer of wealth in United States history with the multiple coronavirus relief packages that bailed out corporate America and big business, while only passing the remaining crumbs onto regular Americans and small businesses. The true grift of American politics does not come from insider trading, which is why it is acceptable to be punished. As Matt Taibbi writes in his 2010 book Griftopia, the bubble up and burst economy is “the long con that is breaking America”.
While it is the case that no single actor caused the coronavirus, the bubble system was by no means orchestrated to protect the interests of the poor man in the event of a bust. In fact, the burst bubble is bad for nearly all actors, including the rich. Which is why it is absolutely crucial that they remain in total control of the government and federal reserve. The real racket of politics emerges not from one singular corrupt legislator, acting in their own financial interests, but by a government that is so constructed as to prioritize the interest and well being of the moneyed elite. It is for this reason that after months of both parties publicly downplaying the looming threat of the coronavirus, Congress came to the rescue only when the stock market finally tanked. Suddenly, all of the concern with the deficit, and the protests of “how are we going to pay for it?” was erased and Washington lowered its knickers to let Wall Street run trains on the Federal Reserve.
Without hesitation when the market began to wane, the Fed was chomping at the bit to intervene. Following a sequence of capital injections throughout the week, first $50 billion followed by another $25 billion 2 days later, when the stock market remained unresponsive The Federal Reserve Bank of New York pumped $1.5 trillion into major banks on March 12, the first multiple massive handouts straight into the hands of the grifter class, who had spent the past decade since the last crash, shoveling any cash on hand into inflating their stock valuation, and ultimately their executive compensation packages.
“Don’t worry”,the taxpayer was assured by their government–this isn’t taxpayer money–it’s simply the United States, a sovereign nation in charge of its own fiat currency, deciding to print more of it. Funny how Modern Monetary Theory only ever applies to the affluent;it would be considered absurd doing the same practice to finance something such Medicare for All, or god forbid eliminating the black cloud of consumer debt, a tremendous burden on the working class that could be settled for approximately $4 trillion dollars. Or conveniently, less than the take of Wall Street’s second heist.
Much was made in the news about $1,200 stimulus checks that were sent out to millions of Americans as a result of the CARE Act, yet less coverage however was devoted to the massive, multi-trillion dollar stock market bailout. A clever bit of legislative maneuvering allowed the Care Act to present itself as a modest, $500 billion bail-out of big business. Within the language of the bill however, is the allowance of $425 billion of the bailout, to be leveraged up to 10 times, bringing the true value of the bailout to over $4.25 trillion.
As David Dayen of The American Prospect writes, the bill’s value well exceeds that which was initially reported, “it’s not a $2 trillion bill, it’s closer to $6 trillion, and $4.3 trillion of it comes in the form of a bazooka aimed at CEOs and shareholders, with almost no conditions attached.” The “almost no conditions” comes in the same form of a lax oversight committee assigned to TARP, meaning if the public is lucky they’ll be able to hear about the massive unpunished fraud committed, well after the funds have been paid out. All the while, nearly 40 million Americans have filed for unemployment and there has been no push from either party’s leadership, to ensure they have access to basic human necessities like shelter and food.
This is a governmental failure on a colossal level, but the racket of American politics is perpetuated by structuring the government like a casino, where the rules of the house are applied only to the rich, leaving everyone else thinking they’re just no good at blackjack. This time, just like every other time, the house got paid, and the patrons lost their ass.
History has repeated itself for the third time since the turn of the millennium, with each economic crash more devastating to the working people, and each handout to corporations more generous. As the public grows more defeated, the rich become more audacious with their racketeering. With their pockets filled with government cash, the vultures of Wall Street have begun to circle their prey, salivating like Pavlov’s dogs at the site of new reports that 40% of all small businesses will close as a result of the lock downs.
Conglomerates that were able to access the hoarded bail out funds will be primed and ready to vacuum up what small businesses remained in an evermore corporatized America. That’s not a bug in the bailout, it’s a feature. Once again, corporate America has been given carte blanche permission to begin re-inflating their bubble, so long as they wait a mere 6 months to begin senselessly buying back their own stock. This cycle will continue perpetually as long as our representative government is bowed at the feet of donor class. Congress will continue to do the bidding of the hand that feeds them pints of artisan ice cream and the working people will be left to starve.