Posts tagged State capitalism

Three notes for the critics of the critics of apologists for Wal-Mart

I’m a few weeks late to the party over Roderick’s Wal-Mart post. For various reasons; I’ve been meaning to write down these notes for a while, but other things have been grabbing my attention. But today seems like a good day to sit down and get to it, and in any case I expect that exactly the same old debate will be coming up some time in the next month or two, so I’d like this to be on record before the next go-around, because there are three arguments from the anti-anti-Wal-Mart side of things that I’m getting tired of reading, two of which I haven’t seen much in the way of substantive replies to, and all of which I’d like, if it is even remotely possible, to make some contribution towards killing dead.

Roderick complained about an article by Fazil Mihlar. Mihlar claims that Wal-Mart deserves both the Nobel Peace Prize and, in fact, sainthood. (I’m not sure that the Vatican has yet started canonizing corporations or other artificial persons. But never mind.) The reason he offers is that Wal-Mart does a lot of good in the world (providing jobs, making donations, making valued goods available at low prices), and that they are able to do that good because of entrepreneurial innovations and expertise in the market, especially the market for the inputs for their business.

Roderick pointed out, in reply, that this account left out a crucial factor: government interventions against the free market that benefit big retail business models, such as the seizure of land through eminent domain, corporate welfare, regulatory suppression of competitors, and government-subsidized infrastructure for long-distance transportation. Thus:

Both Wal-Mart’s critics and its defenders usually see it as an embodiment of the free market. But to me Wal-Mart looks like just one more special interest feeding at the taxpayers’ trough.

I’m opposed to Wal-Mart because I like the free market.

— Roderick Long, Austro-Athenian Empire (2009-03-31): Advocatus Diaboli

I think that’s straightforward enough. But it brought the usual complaints from the usual suspects. There’s a long and very interesting and sometimes illuminating discussion in the comments, which you should read if you haven’t already. But what I want to focus on now is a couple of counter-arguments, which have been repeatedly raised by critics of this line of criticism (notably J.H. Huebert and Stephan Kinsella) which I think involve serious economic errors and a healthy dose of special pleading.

Before I begin, though, let me say a couple of things. First, this post will have absolutely nothing to do with the question of whether or not Wal-Mart is a morally criminal enterprise of the sort discussed in Confiscation and the Homestead Principle, and hence it will have nothing to do with whether or not Wal-Mart enjoys legitimate private property rights over its land, stores, trucks, goods for sale, bank accounts, or anything else, and hence it will also have nothing to do with whether or not it’s O.K. for people to vandalize their stores, loot them, shoplift from them, expropriate their means of production, or otherwise get up in Wal-Mart’s grill. In fact almost nobody who’s been a party to this particular conversation so far (as opposed to some other, separate conversations about protest tactics and Macy’s) has been talking about this, except for a dialogue between Stephan Kinsella and an imaginary left-libertarian in his head. I have my own views on that (which are fairly uninteresting; in short, that there isn’t one answer for the whole corporation and that it depends on the case), but it’s not the issue at hand in Roderick’s article, and it’s not an issue I’ll be addressing here, either.

Second, this article will also have very little to do with whether or not Wal-Mart deserves the Nobel Peace Prize, or sainthood, or praise, or censure, or some mixture or combination of the two. The arguments that I’ll be discussing might feed into a larger discussion about how to parcel out praise and blame, but that’s not my concern here. My concern has specifically to do with the extent to which Wal-Mart ought to be regarded as an example of free-market entrepreneurial success. (That’s related to but distinct from the question of whether Wal-Mart ought to be praised or blamed or neither by free-marketeers. If you’re curious about that topic, this post will disappoint, but you might get something out of my exchange with Will Wilkinson in the post and comments at GT 2008-11-10: The ALLied invasion of Cato.)

With that cleared out of the way, here are the specific arguments that I do want to address.

  1. Why single out Wal-Mart? When left-libertarians point out that Wal-Mart benefits from certain aggressive government interventions, and suggest that this is a reason not to cite Wal-Mart’s bidniz practices as an example of the free market at work, we are constantly asked — with the utmost innocence, even though this has been addressed over and over again every single time it has come up, generally without any response — why we are singling out Wal-Mart for criticism, given that many other market actors also benefit from the same interventions, or from other similarly objectionable interventions. Thus, for example, when Sheldon Richman writes:

    It would be impossible to sort out which profits are legit and which are not. I don’t think that’s the point. The point is to stop the machinery that makes illegitimate profits possible. That’s the state and its various methods of privileging and burdening.

    Kinsella replies:

    Yes. We libertarians are of course against this. So why single out Walmart? By imprecise, lax standards, 99% of society is criminal/suspect. Where does that get us?

    Let me just repeat here the same damn thing that I have repeated every time this stupid question gets asked. There are two main reasons that Wal-Mart gets singled out here. The first reason is often because some conventionally pro-capitalist libertarian brought Wal-Mart up as an example of the free market in action. Since Mihlar brings Wal-Mart up as an example of free market success, then it would be bizarre for Roderick not to have mentioned Wal-Mart in his reply; if we are informed that Wal-Mart ought to be praised because of a characteristic X that it possesses, but it turns out that Wal-Mart does not actually possess characteristic X, then the responsible thing to do is to discuss some specifics about Wal-Mart (not every other market actor toiling in this unfree market of ours) in order to demonstrate that it hasn’t got X. This is, in fact, what actually happened in the exchange that Kinsella was supposedly commenting on.

    The second reason why Wal-Mart often comes up is because Wal-Mart is a convenient example of something broader that they want to discuss — for example, the specific system of state interventions that tends to privilege big box retailers, as a group, at the expense of alternative channels of distribution, and of alternative uses of land more broadly. Of course, Wal-Mart is not the only retailer that benefits from eminent domain seizures, or from government-subsidized infrastructure for long-distance shipping, or from corporate welfare packages in the name of development. So does Target; so does Best Buy; so does Barnes and Noble; and on, and on, down the line, for just about any strip mall chain store you could think of. But Wal-Mart is a convenient example of the broader trend, because of its unique size, scope, and name recognition. If I intend to talk about a certain kind of business model and its relationship with state power, then I hardly think it’s unfair to pick a specific example to talk about, and leave the extension of the analysis as an exercise for the reader. And I hardly think it’s weird or wrong to pick the most prominent and largest example of that particular business model as my specific example. When I write about bad things that the city government in Las Vegas does — for example, its fierce devotion to police brutality, economic cleansing, and using eminent domain to ensure that land gets used the way the tourism and convention industry wants it used, rather than the way that its owners do — I often go beyond simply reporting on local events, and I draw quite broad conclusions about government in general, or city governments in particular, but even then, I don’t feel compelled to mention, in the same breath, every other large city government in the world that does similarly awful things. It’s not picking on Las Vegas, or singling it out, to focus in on it as an example for the sake of discussion. And it is sheer bluster to go on accusing critics of apologists for Wal-Mart of singling out Wal-Mart when they have explained over, and over, and over again why we are mentioning it as an example of broader trends.

  2. Who are Wal-Mart’s competitors? This is, actually, somewhat related to the earlier question, but the issue goes deeper. When Roderick and others (Kevin Carson, especially) point out that the success of Wal-Mart’s business model depends heavily on Wal-Mart’s capacity to convince city governments to grant them corporate welfare giveaways and steal land on their behalf, or on Wal-Mart’s having access to a large network of reliable interstate roads available at a low marginal cost, which are funded in a way that heavily subsidizes those who use them for high-volume cross-country heavy trucking (which is, after all, exactly what folks like Mihlar are referring to when they extol Wal-Mart’s genious at transportation, distribution, and logistics) it is often replied that Wal-Mart is just making better use of available resources than its competitors; that these resources are available not only to Wal-Mart but to its competitors as well, and that, therefore, Wal-Mart’s advantages over its competitors must be the result of something other than the availability of those resources — must, that is, be the result of greater acumen at serving its customers needs. Thus, it is argued, even though Wal-Mart depends on coercively-funded government resources for its current business model, they would (it is argued) have the same advantages (whatever those may be) that make them successful, in this an unfree market, even after the transformation of the market into a free market. Or, at the very least, they oughtn’t to be blamed for being able to successfully make use of those advantages under the present circumstances. Thus, for example, J.H. Huebert in an earlier reply to Roderick:

    We are still not sure why Long believes big businesses, and Wal-Mart in particular, disproportionately benefit from the existence of government roads. No one disapproves of government roads more than we do, but the roads are there for anyone to use — the would-be competitor has just as much access to them as Wal-Mart does. Where is the unfair advantage?

    And again in the comments on Roderick’s more recent post

    How does the existence of government roads hamstring Wal-Mart’s competitors? Anyone can use the roads.

    And Stephan Kinsella, in the same thread:

    Why do the subsidies help Walmart more than local mom and pop competitors? They all get goods shipped from far away

    The main problem with this kind of response is that it betrays a curious sort of anti-economic blind spot about just who Wal-Mart’s competitors are. It is true that, if we lookonly at the other actually-existing businesses that provide substitute goods and services — K-Mart, Target, Home Depot, and other big box retailers, or, expanding outward, smaller, non-chain retailers trying to sell some subset of the goods that Wal-Mart sells — then it is clear that those sorts of competitors do have access to the same kind of government privileges that Wal-Mart does; Wal-Mart just has succeeded more than they have at exploiting those privileges in such a way as to offer the goods most in demand and to offer them at lower prices. Fine. But of course, those aren’t all the competitors that Wal-Mart has — not if you consider the competitors for Wal-Mart’s inputs as well as the competitors for Wal-Mart’s outputs. In conversations like these, it is typical for conventionally pro-capitalist libertarians to act as if the business under discussion were only competing with other large chains in its sector — as if we were just picking on Wal-Mart because they’re an easy target, and rooting for Target instead — or as if it were only competing with retailers more broadly. But it’s not. The market does not just consist of passive consumers and a handful of formalized joint-stock companies. The market is a big and messy place, and whatever you might say about the ways that Wal-Mart gains advantages over other businesses that do basically what Wal-Mart does, it is certainly clear that Wal-Mart’s advantages over competing uses of the land, labor, and infrastructure that are currently devoted to serving its business model.

    Thus, for example, Wal-Mart currently enjoys preferential access to long, straight stretches of land that it needs to ship its goods in trucks. Preferential access compared to whom? Well, not to Best Buy or Mom & Pop’s; they both can get things shipped along the same stretch. That much is seen. But what is not seen is that they — Wal-Mart, and other retailers as well — do have preferential access to those resources when compared the people who used to have, or might have had, homes, farms, parks, small businesses, car-only roads, or any number of other competitive uses of the land, which would have won out if the question were decided by homesteading and voluntary exchange, rather than by tax-funded acquisitions, government land grants, and eminent domain theft. Similarly, other big retailers also typically get at least some of the same government privileges in corporate welfare giveaways and eminent domain seizures in the name of development. Thus, Wal-Mart may not have much advantage over, say, Target, or other fellow big chain retailers, when it come to this kind of government boodle. But those who were using, or would otherwise have used, the money or the land that the government seized, for purposes that government’s don’t count as development, since they don’t increase property or sales tax revenue — keeping up their own homes, growing their own food, running down-market or informal-sector businesses, street-corner hustling, and the like — those people are also would-be competitors for the use of the land, money, or other resources that Wal-Mart is having the government seize and redistribute by force. And those competitors certainly are hamstrung by the government’s redistribution of money, or its expropriation of land. We know that they are because the government is seizing it by force, and people were using it for other things, and would continue to use it for other things unless they were paid more than Wal-Mart and other development beneficiaries pay for it in the forced sale. That is, after all, the point of eminent domain.

    The problem here is that when you fetishize competition as the struggle between similar businesses to provide substitute goods or services, and forget about the other forms of competition for scarce resources that are at issue — often uses by individual property-owners, often uses of the property that may be heavily tied up in local communities and in the informal sector, and may be governed by incentives different from those faced by large, formalized, for-profit corporations — it will, no doubt, seem incomprehensible that someone would focus on how Wal-Mart uses the roads that anyone can use. Because the real nature of the problem is the fact that resources that are currently devoted to those roads cannot be used for what they would be used for in a freed market, which results in a big splash and some major ripples in the market distorted by that particular rock. Not because Wal-Mart alone benefits at the expense of K-Mart or Target, but rather because Wal-Mart, K-Mart, Target, and all the other big-box chain retailers — and, to a lesser extent, also locally-owned, small retailers — all benefit at the expense of somebody other than retailers, and at the expense of uses for land other than the servicing of retail sales, when the government uses force to seize long, straight strips of land, to build and maintain big highways on it, and to open up those roads, mostly without tolls and mostly without price discrimination, to anyone who cares to use it, regardless of what the marginal cost of the use may be. If those big highways weren’t being laid down according to political considerations and development politics, and if they weren’t being heavily subsidized by coercively-seized taxes, the land might well (would probably) be used for something quite other than a large, subsidized national shipping network; and if so, those who intend to go into retail, especially those who want to go into the retailing of goods from an international network of bargain-basement suppliers, might well lose a lot of the comparative advantage that the sword of the State currently grants them over other, non-retail uses of the same scarce resources. It’s not that Wal-Mart is special here among retailers, in anything other than degree; it’s that Wal-Mart is one prominent example of a larger dynamic — the way in which State coercion, State expropriation, and State redistribution sucks scarce resources out of one sector of the economy and spits them out into another — forcibly redirecting them towards large, centralized, formal-sector cash businesses, and away from other, smaller, more localized, more informal, or less commercial uses of the resources (like housing, open space, small farming, cottage industry, local nightclubs, and other typical victims of the Development machine). The reason that Wal-Mart is not a good example of free market dynamics is not because it somehow owes its advantages over Target to government intervention, but rather because Wal-Mart, Target, and the rest of the big retailers all owe their advantages over every other competing use of resources to the heavy hand of government. The result of removing those coercive advantages probably wouldn’t be to hurt Wal-Mart in particular in its competition with Target; but it would remove a mighty big subsidy that Wal-Mart, Target, and all the other big box retailers enjoy over alternative, non-retail uses of the same property. Which might just make for some changes in how our cities look, and in how we get around and make our livings in them.

  • Diamonds, water, and roads: Finally, when Kinsella and Huebert try to exonerate Wal-Mart from blame for the government interventions that it exploits, they often fall back on an argument that it has just made the best entrepreneurial use of a situation that it found but did not create, and in order to support that claim, they have often portrayed Wal-Mart’s relationship with the state as being quite different from what it actually is. Thus, on roads, J.H. Huebert puts it in the most starkly silly terms here:

    Kevin Carson writes: Wal-Mart’s business model is heavily reliant on susidized roads. It supplanted competitors which had local supply chains.

    Yes, but Wal-Mart found the roads there, it didn’t create them, and it used them better than its competitors to serve consumers.

    The funny thing about this kind of argument is watching an Austrian economist suddenly forget everything that he ever knew about marginal analysis, in order to paint a picture of Wal-Mart just bumbling along until — by George! — it finds a road out in the wilderness (perhaps by tripping over it), and thinks why, I might just be able to use this to efficiently serve consumers! Of course, if we are talking about the whole entire Interstate Highway System, then it is true that Wal-Mart did not play much of a role in creating that, and doesn’t play much of a role in the political process that maintains it. It was created largely at the behest of the military-industrial complex and the construction-pork-barrel complex, back in 1956, when Sam Walton was still running a local Ben Franklin franchise. And the political support for it hardly depends on Wal-Mart; the notion that the federal government shouldn’t be involved in seizing land and seizing taxes for the purpose of a huge network of toll-free interstate highways is so far outside the horizons of acceptable dissent in D.C. that nobody would need to lobby against that. So, yes, fine, in that sense Wal-Mart is benefiting from the situation at competitors’ expense (for the reasons I mentioned above), but it did not create the situation that it benefits from; it just got better than some other similar companies at dealing with it.

    But, of course, if you want to do a serious economic analysis of Wal-Mart’s business model, what you really need to know about is not the whole stock of its inputs. What you really need to know about is the marginal units of its inputs. And if we are going to talk about the highway system that services Wal-Mart, we need to look not only at Wal-Mart’s relationship to system of government roads as a whole, but also Wal-Mart’s relationship to the specific stretches of highway that Wal-Mart uses.

    And when we look at it that way, we’ll find that Wal-Mart is heavily involved in every sort of lobbying in order to get various levels of government involved in subsidizing its access to that. Just about every time Wal-Mart decides to build a new store, or especially a new distribution center, they turn to local governments to demand that they grab some money out of working folks’ pockets and put it towards building up business park infrastructure and highway interchanges, or widening or extending some existing stretch of road to service Wal-Mart’s trucking needs, or simply to build a new spur out to service nothing but the distribution center. (A few examples gleaned from a few minutes on Google: 1, 2, 3, 4, 5, 6, 7, 8.) Wal-Mart solicits and actively lobbies for this sort of thing all the time so that they can improve the marginal benefits they get from the road network, while being able to pass along the marginal cost to taxpayers and to those who would have made alternative uses of the land, capital and labor involved.

    So how far is Wal-Mart merely taking advantage of a situation that it did not create, and how far is it actively collaborating in, and pushing for, wider and more intense aggression by the state against private property owners, when it comes to roads? Well, it depends on what you look at. The problem is that those who have wanted to defend Wal-Mart have done so based on lazy arguments based on Wal-Mart’s relationship to the existence of the interstate highway system as a continent-spanning whole. Once you actually look at the construction and improvement of new stretches of road on the margin — which is, remember, what’s important for understanding how far Wal-Mart’s bidniz model does or does not depend on successfully wielding the sword of the State, since it is only on the margin that they are making all of their decisions, counting all their costs, and reaping all of their profits — it becomes clear that Wal-Mart is not just finding the roads there as some sort of given; it went to the government and got the roads it uses put there, typically by force and typically at the expense of unwilling third parties.

If you want to try and defend Wal-Mart, or its apologists, against their left-libertarian critics, fine, let’s talk about that. But please try to find some arguments other than these.

Hope this helps.

See also:

How the local government in Las Vegas deals with the worst housing crisis in the United States

Here's a photo of a back-hoe and the rubble of a demolished building. That's what the government calls...

Neighborhood stabilization.

  1. First, destroy existing housing. Stick your hands in workers’ pockets and take about $42,000,000 out. ($39,537,838 here, $2,000,000 there, and soon you’re talking about real money.) Pocket $2,842,399 of the money for Administration and Planning Costs. Then take $3,000,000 of the money you tok and use it to bulldoze 252 existing homes in North Las Vegas, to be replaced with non-residential development and a 50-unit old folks’ home. Use another $2,000,000+ to demolish another 76 families’ homes. Use another $75,000 to demolish 3 more houses in eligible targeted [sic!] communities.

  2. Next, artificially force up the cost of housing. After forcing about 300 families out of their homes, then take another $24,148,447 of the money and use it to buy up foreclosed or abandoned houses and apartments at artificially high prices, thus forcing squatters out into the street and making it more expensive for people to find new housing. (This artificially expensive housing will of course be rehabilitated according to the usual close enough for government work standards.) While you’re at it, inflict exorbitant $500/day fines in order to force the title-holders on foreclosed properties to maintain unused property according to completely arbitrary standards imposed by the city government, rather than simply lowering the price or abandoning the property. These fines are inflicted with the explicit purpose of making it more expensive for people to find new housing. None of these policies will do anything at all to keep a single Vegas valley resident from losing her home, but they will make it much more expensive for anyone who has lost her home to find a new one.

  3. Call this aggressively stupid policy — a response to a housing crisis that consists of a five-year package of destroying existing housing, inflating housing prices through government subsidies, and using those government subsidies to keep squatters homeless and to keep working poor families captive to politically subsidized slum-lords or mortgage usurers in order to get access to the housing which the government keeps artificially expensive — call it, I say, neighborhood stabilization (since that sounds better than socioeconomic cleansing or government gentrification) and then clap yourself on the back for how you’re helping people find homes.

  4. Celebrate your successful state-capitalist screwjob by digging several million dollars more out of workers’ pockets to build a multimillion dollar new city hall complex.

See also:

Just shut the fuck up

I don’t mean to be rude. But this issue is important.

There are lots of reasons to despise Alexander Hamilton — given his record as a Caesarian centralizer, rampaging war-luster, and the spiritual and political father of U.S. state capitalism. There are also lots of cases where Thomas Jefferson was better than Hamilton on things that Hamilton was rotten on. This should be taken into account if you are ever trying to rank U.S. revolutionaries according to their libertarian merits. But the reverse is also true, and the issues that Jefferson was rotten on — like, oh, slavery — were not small potatoes or minor personal foibles. And while I think that Will Wilkinson is making several interrelated mistakes, among them misrepresenting and unfairly minimizing the case against Hamilton, when he says…

If you think central banks are a bigger issue for liberty than human enslavement, trade, or the growth of capitalism then your priorities are screwed.

— Will Wilkinson (2008-04-07), comments on ABJ @ The Fly Bottle

… what I would like to stress, at the moment, is that if you ever, ever find yourself thinking that it might possibly be appropriate to reply to a remark like that by saying something like this:

Central banking is one of the worst forms of human enslavement, actually. You should try going out more often, WW, and read some Hoppe and DiLorenzo for good measure.

— Alberto Dietz (2008-04-09), comments on ABJ @ The Fly Bottle

Then you need to stop. Right there. And just–well, you know the rest.

Thomas Jefferson wrote a couple of documents that I admire very much. One of them I consider to be one of the finest and most important political documents written in the history of the world. But Jefferson was a man, not just the signature on a series of essays, and he also did many other things in his life. He was an overt and at times obsessive white supremacist. He was a rapist. He was a posturing hypocrite. He was President of the United States. He was himself a war-monger, who launched the United States’ first overseas war within months of his first inauguration. Most of all, he was a active slaver, a lifelong perpetrator of real, not metaphorical, chattel slavery. He violently held hundreds of his fellow human beings in captivity throughout their lives and throughout his, with the usual tools of chains and hounds and lashes. He maintained himself in an utterly idle life as a landed lord of the Virginia gentry by forcing his captives to work for his own profit, and living off of the immense wealth of things that they built and grew by the sweat of their own brows and the blood of their own backs. He had no conceivable right to live this life of man-stealing, imprisonment, robbery and torture, and no justification for it other than racist contempt for his victims and the absolute, violent power that he (with the aid of his fellow whites) held over the life and limb of hundreds of victims. He knew that his own words in the Declaration of Independence condemned his own actions towards his slaves, who were by right his equals, beyond appeal, but he went on enslaving them anyway for the rest of his life and would not even make any provisions in his will to set them free when he finally died. He was a hereditary tyrant, claiming, based solely on his descent, the right to go on perpetrating a reign of terror over his prison-camp plantation more hideous and invasive than anything ever contemplated by the most absolutist Bourbon or Bonaparte. Not because he was in any way extraordinary or at all harsher than the average, compared to other white slavocrats, in how he treated his slaves–but rather because that kind of terror and violence is part and parcel of what forcing hundreds of people into chattel slavery means. As insidious and destructive as government-centralized banking and the money monopoly may be — and I am the last person to deny that — it is callous, counter-historical, inhuman bullshit to try and pass it off as one of the worst forms of human enslavement in comparison to American chattel slavery. It’s bullshit that needs to stop.

A side note. When trying to explain Jefferson’s view on slavery, one thing that a lot of people seem to take as a point in his favor is his opposition to the trans-Atlantic slave trade. In 1807, Jefferson in fact signed a bill banning the trans-Atlantic slave trade (which could not take effect until 1808 because the U.S. Constitution only granted Congress the power to regulate the international slave trade 20 years after its ratification). It comes up a couple of different times in the same comments thread.

Unfortunately, it doesn’t actually speak in Jefferson’s favor. Jefferson, like many other white Virginian slave-camp commandants, was indeed for banning the trans-Atlantic slave trade, which he, like many other white Virginian slavers, sometimes fiercely denounced as infamous and inhumanly cruel. They were right about that part, and they were right that the trans-Atlantic slave trade ought to have been banned, but their primary reasons for wanting it banned were quite different from what people reading them today often conclude. If, after all, they were actually against the slave trade for humanitarian reasons, then they certainly ought to have the same problems with the internal slave trade in the United States, and the exportation of slaves out of the United States (for example, down to the death-plantations of the Caribbean). Those parts of the slave trade also involved the hellish passage of hundreds of slaves, shackled below decks, in sea voyages from New England or the upper South to the far-away places they were sold down to. But you’ll find little of that from Jefferson or his fellow white Virginian slavers, and the reason is that they profited from the internal slave trade. By the late 18th and early 19th century, Virginia was in the process of a long decline in agricultural productivity, but the landed lords held on to their stream of pirated wealth — by becoming the leading exporter of slaves to other, more productive plantations, down in the Deep South and in the Caribbean. Jefferson’s opposition to the slave trade, like that of many of his fellow Virginia slavers, was not nascent abolitionism. It was pure protectionism, designed to prop up the Virginian slave-traders’ profits while they retained the same absolute, violent power over their slaves at home.

Hope this helps.

Further reading:

Tyranny means never having to say you’re sorry

Here’s a brief clipping from Wired‘s recent profile on Bill Baker, a structural engineer who specializes in gigantic skyscrapers. He’s currently working on a project for the Emir of Dubai which, when completed, will be the tallest building in the world:

In spring 2003, a pair of developers invited Baker and two of SOM’s managing partners to dinner at a restaurant overlooking the Manhattan skyline. The developers worked for a company in Dubai called Emaar, and they wanted to construct the tallest building in the world. Dubai was eager to make its mark, and because its ruler, Sheikh Mohammed bin Rashid al-Maktoum (known affectionately by locals as Sheikh Mo), supported the project, there would be no litigious neighbors or pesky air traffic controllers to muck things up. There are some places in the world that are like, Let’s do it, get it done, Baker says. Dubai is one of those places. Emaar gave SOM two weeks to submit a proposal for a residential building, to be known as the Burj Dubai. The Dubai Tower.

— Andrew Blum, The Ultrabuilder, in Wired 15.12 (December 2007), p. 224.

In other words, this monumental building project got rammed through, while the people who have to live in its shadow and the airline operators that have to fly around it are legally prevented from doing anything to effectively voice their objections, let alone to get some kind of compensation for the inconveniences, costs and disruptions that such gigantic projects inevitably impose on their private property or their long-established business in common resources and transit lanes. That’s because Bill Baker’s gigantic skyscraper is the pet project of Sheikh Mo, the enormously wealthy, relentlessly self-aggrandizing, and completely unaccountable petty tyrant of Dubai, who can personally manipulate any legal proceeding, override any attempt by ordinary people to get some kind of redress, and shove around any business in the country, if any of them threaten to get in the way of yet another multimillion dollar monument to himself.

It takes a certain kind of mindset to crow about the will and the ability to trample on everybody else’s homes, lives, and livelihoods in order to get a big project rammed through as if it were the positive, can-do sort of attitude that the political-development complex ought to adopt always and everywhere. That mindset is no less tawdry and mean for being so common amongst the most powerful, influential and well-connected people on earth.

Cognitive Dissonance of the Non-Libertarian Left

Pam Martens’ recent article in CounterPunch looks at the rickety finance sector and the role that CDOs–complex securities that tap into the cash flow from a multilayered portfolio of debt obligations–have played in the money barons’ recent woes. Her piece is, oddly, titled The Free Market Myth Dissolves into Chaos. I say it’s odd, because here is what we find by the second and third paragraph from the top:

Given that these big Wall Street players now own some of our largest, taxpayer insured, depositor banks (courtesy of a legislative gift from Congress called the Gramm-Leach-Bliley Act) and the Federal Reserve is shoveling tens of billions of our dollars into some very big black holes, …

… The Bush administration is spinning the mess as a subprime mortgage problem lest the public figure out that a $1 Trillion unregulated market has blown up under the free market noses of this administration.

— Pam Martens (2008-01-03): The Free Market Myth Dissolves into Chaos

There are many kinds of manipulation and jobbery that go on actually existing capital and finance markets that deserve criticism, and the Left, including Martens, have some wise and insightful things to say on this point. The mystery is where the terms unregulated market and free market come into the picture. When one directly mentions government-imposed, tax-funded deposit insurance, and government cartelization of the entire banking industry under the auspices of a government-created, government-controlled central bank, one would expect at least a little recognition of the fact that we are dealing with a market rigged by government interventions to insulate and direct high finance. If nothing else, one would expect that the switcheroo from a critique of actually existing state capitalism to a critique of free markets might wait for at least a few more paragraphs, in order to make the manifest cognitive dissonance a bit less excruciating.

Further reading: