Sunday, April 10, 2016

Today's Capitalists Are Parasites

Here is a cool essay by Dr. Paul Craig Roberts:

When I was a young man, an individual with one million dollars was very rich. Anyone with a few millions more was considered richer than rich. Today there are people who have thousands of millions of dollars.

Few earned their billions by producing goods and services sold to consumers.

The neoliberal economists, who prescribe economic policy not only in the West but also in Russia and China, incorrectly claim that money received is money earned. In fact, how did the Less-Than-One-Percent really get their thousands of millions?

They got them through political connections and through purely financial transactions.

When the Soviet Union fell apart as a consequence of hardline communists arresting President Gorbachev, well connected individuals in Russia and the Soviet province of Ukraine, especially those well connected to Washington and Israel, ended up with massive holdings that formerly were state properties.

In the US billionaires result from bank lending for leveraged takeovers of companies. The takeovers produce riches for the takeover person from curtailing company pensions and using the company’s cash to pay off the takeover loan. Often the company and its employees are ruined, but the takeover artist walks away with massive amounts of money. Manipulation of initial public offerings are another source of riches as are securitized derivatives.

Classical economists, and Michael Hudson today, define these profits as “economic rents,” the income from which required no increase in real output to produce. In other words, these billionaire wealth gains are a form of parasitism based on exploitation and not on the production of real output. The gains result from draining income from production into the service of debt.

You can read the rest @

I hesitate to call the vast majority of Americans "morons", but at the very least they are severely deluded. And Roberts is right - there will be no revolution in the US, at least not one which overthrows the power of the one percent. Like Chief Broom of One Flew Over The Cuckoo's Nest, we don't know our own strength.

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