Delusional Illusions

John Calvin (Jehan Cauvin, 1509 - 1564). What a guy! A guy for his times but perhaps not for ours. His disciples turned his doctrines on their heads and one result was the Protestant work ethic and capitalism, something that once promised a better world here and now for everyone and of course, for the “elect,” a better world forever (although, if you were not among the elect, well… sorry about that, no hope as you crossed the portals that require that all hope be checked before entering). Kind of like today’s “capitalism” (really more an extreme form of corporate welfare).

Some context.

At the urging of the neoliberal institutions that flowered at the end of the Second World War (fertilized by millions of corpses), institutions like the International Monetary Fund, the World Bank and the international trading and financial systems established at Bretton Woods, New Hampshire, dozens of countries—usually third world—but now including economies as large as those of France, Spain, Portugal and Italy, have been coerced into forcing austerity on the bulk of their citizens in order to assure profitable economic returns on investments by investors who made bad bets, but would rather not pay the price of their poor judgment and must thus be protected from the consequences of their reckless folly (at best) or illegal conspiracies and manipulation (most likely). See, e.g., Clark, Neil (2018). “The 2008 financial crash: Punishing the victims, rewarding the perpetrators”; RT.com, © Autonomous Nonprofit Organization “TV-Novosti”, 2005–2018. All rights reserved, August 10, 2018, available at RT, first accessed on August 10, 2018.

The list of victims includes most Latin American countries, most if not all African countries and European countries like Greece, Portugal, Italy, Spain and, well, okay, most of the European Union other than Germany and the Nordic states. Countries that decline to betray their citizens find themselves demonized and calumnied and their economies destroyed through fifth columnist economic elites within and economic sanctions from abroad (Iceland somehow escaped such punishment perhaps being too small to matter, in this context, not a bad thing). As the manipulated economies dive, the successful manipulators cry rivers of crocodile tears, spuriously lamenting the plight of the populace allegedly victimized by corrupt and inept governance (all too frequently also true but only a minor part of the causative factors). If the bewildered populace does not react appropriately at the ballot box, coups, either military, legislative or judicial are frequently the result (see, e.g., Honduras, Brazil and Egypt, respectively). Venezuela, are you listening?

Austerity, but not for all. Besides lucrative bailouts funded by the common citizenry, demands for popular austerity are now generally coupled with tax cuts for the wealthiest justified as job creation mechanisms. As though demand were not the most essential element in job creation. As though adequate demand does not require that the least financially well off also have the wherewithal to purchase goods and services. Of course, for the very short sighted among the one percent, that’s a problem for another day.

The reality is that the surest way to increase jobs and to assure a well-functioning economy is by increasing the financial capacity of the poorest among us. They spend everything they get, they have to, and that flows upwards through small merchants and their employees to larger and larger suppliers and their employees until it lands in the pockets of the wealthiest anyway (percolate up rather than trickle down). Too many of the economically best off hoard their wealth or spend it on luxury items that don’t do much to help the masses economically, unless of course, their income, whether earned (rare) or through investments is taxed in a manner commensurate to the benefits the state provides in protecting their accumulated wealth such taxation also being designed and implemented in a manner motivating productive use of acquired wealth. The wealthiest among us are not the middle class nor should reasonable wages be highly taxed. Pure investments, especially involving inherited wealth, those that involve no meaningful work, well, if the goal is job creation, then that is where the bulk of taxation should be and where it ought to remain; that and, of course, huge executive salaries, huge salaries of any kind, and by huge, I mean a multiple of the minimum wage exceeding twenty. For example, if the minimum wage were $15 per hour, then a salary of more than $300 per hour would meet the “huge” test. If the wealthiest then want to reduce their taxes, the only way would be to increase the minimum wage, a reasonable and efficient tie-in to promote a more just economy for all.

The United States has long been the champion of austerity for others but not necessarily at home, after all American exceptionalism ought not to be bound by rules applicable to others. In fact, the United States is an anomalous case because of the successful bipartisan fraud perpetrated though “use of the dollar as the international medium of exchange” Ponzi scheme, a scam enforced through a combination of perpetual war and perpetual theater: legerdemain spiced with constant and all-encompassing hypocrisy. Of course, there’s only room for one international Harry Houdini at a time (sorry China, Russia, India, et. al.). Most recently, Mr. Trump’s formula, lower taxes on everyone and consistent economic warfare abroad has proven temporarily successful (elections are in November) and as long as the United States can control international financial transactions through its control of the world’s primary financial infrastructure it may continue to work, at least until its victims (you know, the subjects of continuing streams of economic sanctions) don’t manage to expose the fact that not only is the Emperor not wearing any clothes, but neither are the members of his court.

So… now that the United States has lowered taxes on the wealthiest while simultaneously improving working conditions and job creation for many, perhaps even most, others are being cajoled to jump on the bandwagon. The chorus of one percenters in second tier countries are demanding their due. Take the Republic of Colombia for instance. Under its new right wing government, again under paramilitary darling Alvaro Uribe Velez (through his mannequin, “how high should I jump boss” Ivan, the man, Duque), Colombia will now join other countries in the delusional illusion of job creation through lowering of taxes on the wealthiest and austerity for the rest. How tragically Greek.

Other countries, primarily Nordic, are considering other job creation—common welfare concepts. One, designed to insure job growth as well as the common welfare, involves a guaranteed minimum wage. Many of us first encountered the concept in the early 1970s when it was proposed by Richard Nixon (ironically, probably the most liberal president in the past fifty years), although in other terms. President Nixon referred to it as a negative income tax. Of course, then as now, the concept is anathema to the Protestant work ethic. Heresy! Socialism!!!! Heaven forbid. Poor Jehan Cauvin spins in his grave at the thought.

But think about it. It certainly promotes employment much more than lowering taxes on the wealthiest. It obviously increases demand and as stated before, “increased demand” is the key to economic prosperity as long as it’s coupled with an ability to satisfy the demand. Ask yourself, “As an entrepreneur, do you really care if the money used to buy your goods and services was earned through a job or received as welfare?” “Do your employees really care about the source of their wages and benefits as long as it is not the product of criminal activity?” Okay, many would not be bothered by the latter but that moral deficiency affects the wealthiest much more than it does run of the mill employees. The reality is that as technology makes workers more and more obsolete, a solution needs to be found that spurs demand while providing for the basic needs of the least economically benefitted among us. It’s either that or the kind of social pressure cooker that led to the French Revolution and perhaps the Bolshevik revolution as well.

So, as Oliver Hardy was wont to remark to Stan Laurel (look them up in Wikipedia if your younger than forty), “Another fine pickle [they’ve] gotten us into”. Somewhere Che Guevara smiles as he sips a mojito, whether in Havana, Heaven or Hell it’s hard to tell. He’s just finished reading Thomas Piketty’s Capital in the Twenty-First Century and says to a well-dressed albeit somewhat effete fellow sitting nearby, “Isn’t that exactly what I’d been saying when I was so rudely interrupted?”

Something to think about. _______

© Guillermo Calvo Mahé and Diana Marcela Cardenas Garcia; Manizales, 2018; all rights reserved. Please feel free to share with appropriate attribution.

Guillermo Calvo Mahé (a sometime poet) is a writer, political commentator and academic currently residing in the Republic of Colombia although he has primarily lived in the United States of America (of which he is a citizen). Until recently he chaired the political science, government and international relations programs at the Universidad Autónoma de Manizales. He has academic degrees in political science (the Citadel), law (St. John’s University), international legal studies (New York University) and translation studies (the University of Florida’s Center for Latin American Studies). He can be contacted at [email protected] and much of his writing is available through his blog at www.guillermocalvo.com. Diana Marcela Cardenas Garcia is a Colombian social communicator and journalist who collaborates with Dr. Calvo on diverse civic, social and political projects.