Louis Proyect: The Unrepentant Marxist

November 12, 2012

Who says the Koch Brothers and Sheldon Adelson wasted their money?

Filed under: capitalist pig,financial crisis,parliamentary cretinism — louisproyect @ 8:54 pm

David and Charles Koch

Sheldon Adelson

One of the things heard incessantly since Election Day is that the Koch brothers and Sheldon Adelson did not get their money’s worth. Alternet’s R.J. Eskow spoke for many of his co-religionists:

I should be a better person than this, but I take no small amount of satisfaction in knowing that Sheldon Adelson and the Koch Brothers wasted lots and lots and lots of money this year.

It is necessary to put this into perspective. The Koch brothers spent $400 million. That represents just .008 of their combined personal fortune of fifty billion dollars. Forbes Magazine shared my perspective when it came to Adelson:

Yes, Sheldon Adelson crapped out on Election Day. But Adelson has plenty of more chips to place on the table–billions more.

True, the casino billionaire spent at least $53 million on this election cycle with little to show for the investment. And while it’s a massive amount of money for most people, and most companies, it’s pocket change for Adelson. The Las Vegas Sands boss is worth $20.5 billion. My colleague Clare O’Connor drew this great comparison yesterday: “Imagine an average person with a $100,000 net worth buying a pair of Tory Burch shoes ($250). You’d care if you lost them, but you wouldn’t be ruined.” Adelson’s $53 million is gone. The billionaire isn’t going anywhere.

Although I am not privy to the innermost calculations of such characters, I think that they share one thing with me, namely a belief that there is no room for compromises when it comes to electoral politics.

Historically this was not always the case with the Republicans. The most notable example in recent times was the presidency of Dwight D. Eisenhower who Robert Welch, the founder of the John Birch Society, described in these terms: “Could Eisenhower really be simply a smart politician, entirely without principles and hungry for glory, who is only the tool of the Communists? The answer is yes.” He also stated: “With regard to … Eisenhower, it is difficult to avoid raising the question of deliberate treason.”

It should also be noted that Fred Koch, the paterfamilias of the reactionary gang, was a founding member of the John Birch Society and that his sons’ funding of the nativist and racist Tea Party movement reflects a continuity with the past.

It is important to understand that at one time “Eisenhower Republicans” enjoyed hegemony in the party. Despite the tendency of the Communist Party and many 60s radicals to dub Richard Nixon as a looming fascist, he had plenty in common with Eisenhower, for whom he served as Vice President for two terms. In an interview with Howard K. Smith in January 1971, he said “I am now a Keynesian”. Can anybody imagine that empty suit President Obama saying something like that? This, in fact, is where he stands:

Reagan spoke to America’s longing for order, our need to believe that we are not simply subject to blind, impersonal forces, but that we can shape our individual and collective destinies, so long as we rediscover the traditional virtues of hard work, patriotism, person responsibility, optimism, and faith.

That Reagan’s message found such a receptive audience spoke not only to his skills as a communicator; it also spoke to the failures of liberal government, during a period of economic stagnation, to give middle-class voters any sense that it was fighting for them. For the fact was that government at every level had become too cavalier about spending taxpayer money. Too often, bureaucracies were oblivious to the cost of their mandates. A lot of liberal rhetoric did seem to value rights and entitlements over duties and responsibilities.

Barack Obama, Audacity of Hope, p. 31-32

Some people, especially younger people who have no memory of liberal Republicanism, believe that Ronald Reagan transformed the Republican Party. In reality, the seeds were planted in 1964 when Barry Goldwater said in his acceptance speech as Presidential candidate for the Republican Party: “I would remind you that extremism in the defense of liberty is no vice! And let me remind you also that moderation in the pursuit of justice is no virtue!” Come to think of it, he was right.

Goldwater’s aim back then was to transform the Republican Party into a conservative party. In doing so, he found a counterpart among many liberals who yearned that the Democratic Party become more purely liberal. In practice this meant purging the party of the Southern racists, something that turned out to be unnecessary after Nixon adopted his “Southern Strategy”.

Today there are no important liberal Republicans. Arguably, the last one standing was Pennsylvania Senator Arlen Specter, who defected to the Democratic Party in 2009 three years before his death. (It is not so well-known that Specter was a Democrat to start with, from 1951 to 1965.)

Unlike the Republicans, the Democrats never could be mistaken for a liberal party after George McGovern’s candidacy in 1972, at least when it came to presidential nominations. Starting with Carter, there has been a steady drift toward the ideology of the Democratic Leadership Council, a nasty collection of rightwing politicians who began defining themselves as “New Democrats” in the same spirit of Tony Blair’s “New Labour”.

In March 2009, Obama told the New Democratic Coalition, a group described by politico.com as “comprised of centrist Democratic members of the House, who support free trade and a muscular foreign policy”, that he indeed was a New Democrat.

Before Bruce A. Dixon split with Black Commentator, a website that eventually became typified by Bill Fletcher Jr.’s pro-Obama think-pieces, he wrote an article titled “In Search of the Real Barack Obama: Can a Black Senate candidate resist the DLC?”. For some reason, this must have nettled candidate Obama who took the trouble to write the ‘zine prior to his election:

Dear Black Commentator:

I read with interest, and some amusement, Bruce Dixon’s recent article regarding my campaign, and his suggestion that perhaps my positions on critical issues facing this country are somehow being corrupted by the influence of the Democratic Leadership Council (DLC).  Given that Bruce [and I] worked together back in 1992 to empower communities through organizing and the ballot box, I wish he’d taken the time to give me a call and check out his facts.

To begin with, neither my staff nor I have had any direct contact with anybody at DLC since I began this campaign a year ago.  I don’t know who nominated me for the DLC list of 100 rising stars, nor did I expend any effort to be included on the list beyond filling out a three line questionnaire asking me to describe my current political office, my proudest accomplishment, and my cardinal rules of politics.  Since my mother taught me not to reject a compliment when it’s offered, I didn’t object to the DLC’s inclusion of my name on their list.  I certainly did not view such inclusion as an endorsement on my part of the DLC platform.

This, of course, was still at the time when Obama was trying to fool some people into thinking that he had liberal credentials. After his election, he dropped any such pretenses. In his re-election bid, he made no effort to reestablish such credentials since so few people would take him seriously. Instead, his super-PAC spent hundreds of millions of dollars making the case that Romney was a greedy, out-of-touch bastard. The ads reminded me of Pee Wee Herman’s rejoinder to his tormentor Francis in “Pee Wee Herman’s Big Adventure”: “I know you are, but what am I?”

Well, I know what Obama is. He is a liberal Republican, maybe even a centrist Republican. In fact, if anybody can tell the difference between a Gerald Ford and a Barack Obama, except for their pigmentation, they have a talent for splitting hairs second to none.

Yes, Virginia, there has been a realignment in American politics, at least on the Presidential level. We have conservative Republican presidents going back to Reagan, but with the Democrats we get nominees who are indistinguishable from Gerald Ford or Howard Baker. But when one of these slobs gets elected, as happened last Tuesday, we get the liberal pundits greeting it once again as the second coming of the New Deal.

Returning to the Republican Party, the question of Koch and Adelson’s money being “wasted” deserves further interrogation. I strongly recommend a look at Chris Kromm’s very fine Southern Voice, where you can find an article by Chris titled “Did Big Money really lose this election? Hardly.” Chris writes:

The fact that TV ads are most effective with less-engaged voters might explain money’s continuing influence in state and local races, which receive far less media exposure and voters may know even less about the candidates and issues.

As Facing South and The New Yorker showed, in 2010 an onslaught of outside spending in North Carolina by outside money groups led by Republican donor Art Pope was a key factor in fueling a historic GOP takeover of the state legislature.

That put N.C. Republicans in charge of the once-a-decade redistricting process, producing new maps which the John Locke Foundation — which is largely funded by Pope’s foundation — readily admits were crucial to enabling the GOP to expand its power in the General Assembly in 2012.

Money’s state-level influence in North Carolina continued this year, too. According to FollowNCMoney.org, a money-tracking website run by the Institute for Southern Studies, more than $14 million from super PACs and other outside groups poured into N.C. state races.

Of the top 10 spending groups in North Carolina — which made up more than 90 percent of the $14 million total — seven were Republican-leaning groups, who outspent their Democratic-leaning counterparts by more than a two-to-one margin.

And unlike the national super PACs, conservative spending groups in North Carolina enjoyed a much higher winning percentage: Of the 10 races that attracted the most outside money, nine ended in Republican victories. (As for Pope, he and his operatives are well-represented in the newly-elected GOP governor’s transition team.)

But even if Koch and Adelson type funding had less of an effect in the South and elsewhere, that would not prompt such donors to wash their hands of their project, which is not limited to immediate and measurable goals. They are building a reactionary movement that is seeking to turn back the clock to 1890 or so. By spending hundreds of millions of dollars, they push the political agenda to the right. In doing so, the “centrist” politics of a self-avowed New Democrat like Obama shifts to the right along with them.

More to the point, the reactionary agenda of the Koch Brothers is ultimately shared by many corporate bosses who never would be caught dead at a Tea Party rally. Nothing symbolizes this better than The American Legislative Exchange Council (ALEC) that gained some notoriety after its heavy paws were detected in the struggle against Scott Walker in Wisconsin and, even worse, their support for “Stand Your Ground” laws that resulted in Trayvon Martin’s murder.

In the outcry over their Koch-funded skullduggery, some major corporate members were forced to drop their affiliation, including Walmart, Coca-Cola, Wendy’s, Kraft Foods, McDonald’s, the Bill and Melinda Gates Foundation, and Blue Cross/Blue Shield.

The people who run these corporations are not that interested in ideology. What they are interested in, however, is protecting their class interests. The ultimate explanation for the rightwing assault on our standard of living, our safety on the job, our right to a job, our health, and our right to express our opinion, is a declining rate of profit. While it is not within the purview of this article, and more importantly my limited expertise, to explain why there is such a tendency, suffice it to say that the good old days are gone forever. Despite the rhetoric of a Ronald Reagan on one side and a Barack Obama on the other (all proportions being guarded), well-paying jobs is a thing of the past.

I do recommend an article by Marxist economist Michael Roberts who blogs at http://thenextrecession.wordpress.com/ titled “Does it matter who wins?”, written the day before the election. It is a close look at the economic prognosis of the U.S. and concludes on this note:

For me, the bellwether for the health of US capitalism is the rate of profit.  That shows little sign of returning to levels seen in the late 1990s, let alone back to the golden age of the 1960s.  A low and probably falling rate of profit implies a low rate of new investment ahead, with unemployment staying well above ‘normal’ levels.  And it implies the likelihood of another slump in production before the next four years are over along with the continuance of the Long Depression, now in its fifth year.  And remember the Long Depression that started in 1873 lasted 20 years.

Given these prospects, the bourgeoisie will be forced to rely on the carrot and the stick—or perhaps more accurately, the soft cop and the hard cop. With declining profits, the ruling class will be forced to cut expenses both privately and publicly. Wages will be pushed down, mostly as a result of the threat of runaway shops our outright closings. Expenditures on education, health and the environment will be cut as well.

In the long run, the U.S. will look more and more like Detroit with the wealthy living in gated complexes and the poor forced to make do with less and less. Furthermore, as Hurricane Sandy demonstrates, “natural” disasters will weigh more heavily on the less privileged.

Under such circumstances, there will be mounting anger of the sort on display throughout Southern Europe. The more far-sighted members of the ruling class are planning ahead, to see what powerful and ultimately lawless measures will be necessary to suppress any revolt that threatens their hegemonic rule. And, as well, the more far-sighted members of the working class, including the intelligentsia that has thrown in its lot with this class, will be required to put together an audacious and intelligent plan of action that can meet such scum head-on and defeat it.

22 Comments »

  1. Thanks for this Louis. Some liberal commentators seemed to think the Republican losses portends the death of “big money” in US elections. Fat chance. They’ll go back to the drawing boards and figure out how to buy better results net time.

    Comment by Colin Brace — November 12, 2012 @ 9:47 pm

  2. Jeff Cohen is pretty typical of your Left Dem in the Left/Right symmetry error: http://newpol.org/node/623#comment-151840

    That’s because they don’t have a class oriented anti-capitalist politics. They can’t, and still remain within the DP.

    My reply, as I don’t know if it got posted on New Politics:

    Jeff Cohen makes the standard mistake of assuming symmetry in the relation of the Left and the Right to a capitalist political system. But that assumption is false: a militantly pro-capitalist politics will make institutional headway in such a system monopolized by two capitalist parties; anti-capitalist politics will not. Capitalists have access; workers do not.

    To make headway “like the Far Right” – and BTW, how is that working out for the Republicans this election season? – the progressive Left will have to lose its anti-capitalist (aka socialist) politics. They’ll be permitted to support gay rights, reproductive freedom, legal marijuana and even antiwar, but they will not be permitted to stay in the Democratic Party AND advocate openly and explicitly principled anti-capitalist or socialist positions.

    That’s the red line for the Democrats. That means it will be we independent and socialist leftists that will have to run campaigns against *you*, progressive Democrats, as with Socialist Alternative Candidate Kshama Sawant:

    http://www.thenorthstar.info/?p=3137

    In fact, we can roll out these sorts of campaigns now in all of the progressive electoral districts, before the Democrats gerrymander them out of existence with their supermajorities as in CA. I can’t wait to hear the screams of horror from the left in the DP! We’ll translate the accusation that “we are dividing the Left!” into “We are AT LAST launching a much needed public debate within the Left over core issues impacting our core constituencies.

    Core issues such as capitalism and the way out of it.

    Look forward to see you all at the debate podium – Frank Chopp certainly didn’t!

    -Matt

    Comment by matthewrusso9 — November 12, 2012 @ 11:03 pm

  3. You have probably read about Stalin’s role in the origins of the Koch family fortune, but I can’t resist bringing it up:

    http://exiledonline.com/a-peoples-history-of-koch-industries-how-stalin-funded-the-tea-party-movement/

    “In 1929, after hosting a delegation of Soviet planners in Wichita, Kansas, Winkler and Koch signed a $5 million contract to build 15 refineries in the Soviet Union. According to Oil of Russia, a Russian oil industry trade magazine, the deal made Winkler–Koch into Comrade Stalin’s Number One refinery builder.”

    Comment by Brian Gallagher — November 13, 2012 @ 12:18 am

  4. “In an interview with Howard K. Smith in January 1971, he said “I am now a Keynesian”. Can anybody imagine that empty suit President Obama saying something like that?”

    Of course no one would expect to hear Mr. Obama say that; the reason is simple: in the 1970s, Keynesian macroeconomic theory was the dominant theory in academic economics. Today that is no longer the case; most academic macroeconomists to-day are the cumbersome-sounding “New Keynesians”. Certainly Summers is a New Keynesian and the driving force of Mr. Obama’s policies is New Keynesian. Yet the word has no currency with “the man in the street” so why expect Mr. Obaa to force it into a sound-byte?

    Comment by Harsanyi_Janos — November 14, 2012 @ 11:14 pm

  5. Brian, Koch wrote the turgid A Business Man Looks at Communism about his time building refineries in Stalin’s Russia; he claims that these experiences were the germ of his anti-Communism. Not so much of a gotcha I suppose then?

    Comment by Harsanyi_Janos — November 14, 2012 @ 11:16 pm

  6. @Harsanyi_Janos
    Unless Koch’s anti-communism was so principled that he gave away the millions paid to him by Stalin, then it certainly is “much of a gotcha”. What was in Koch’s heart of hearts is of complete indifference to me. The objective facts speak for themselves.

    Comment by Brian Gallagher — November 15, 2012 @ 1:39 am

  7. All this is really well know, in fact Koch publicised it — in the above mentioned book. It at best rises to the level of Oliver North thinking it was “pretty neat” that he could trouser the Mullahs’ money and funnel it into buying weapons for the Contras.

    Comment by Harsanyi_Janos — November 15, 2012 @ 2:39 am

  8. “The ultimate explanation for the rightwing assault on our standard of living, our safety on the job, our right to a job, our health, and our right to express our opinion, is a declining rate of profit.”

    I wonder if anybody can explain why declining profits, or a falling rate of profit, if it is something predictable and not a surprise that hits the capitalists only after they have borrowed money at an interest rate based on that higher rate of profit — should be a problem, rather than just an annoyance, for the capitalist class? And wasn’t the tendency of the rate of profit to fall also operative in the days when capitalists were making concessions to the working class and the consumption levels of the latter were increasing?

    Maybe the reason that capitalists are attacking the incomes of the working class now, at least in the imperialist metropoles where such incomes have been relatively high, is that they can, or believe they can, get away with it.

    Comment by Red Snapper — November 15, 2012 @ 10:26 am

  9. There is no falling rate of profit. If you look at a time series of corporate profits in the USA for the period 1947 to 1980 (the period where surely “capitalists were making concessions to the working class and the consumption levels of the latter were increasing”) there is no downward trend in the rate of change.

    Comment by Harsanyi_Janos — November 15, 2012 @ 7:53 pm

  10. Don’t take my word for it though; look here: http://tinyurl.com/a2ae5v5

    Comment by Harsanyi_Janos — November 15, 2012 @ 7:55 pm

  11. Yes but look at wages and share of income going to lower income groups and you will see how that chart is kept looking the way it does.

    Comment by Alex — November 15, 2012 @ 8:04 pm

  12. @9: There is no falling rate of profit.

    Sir, I understand that you are not that familiar with Marxist theory and are mainly trolling here. But it would behoove you to show a little bit of familiarity with the Marxist understanding of how to measure the rate of profit than referring us to a CPI graphic. Here is something from Michael Roberts:

    http://thenextrecession.wordpress.com/2011/07/29/measuring-the-rate-of-profit-and-profit-cycles/

    Marx was clear on what his definition of the ROP was – the general or overall rate of profit (ROP) in an economy was the surplus value generated by the labour force divided by the cost of employing that labour force and the cost of physical or tangible assets and raw materials that are employed in production. His famous formula followed: P = s/c+v, where P is the rate of profit; s is surplus value; c is constant capital (means of production) and v is the cost of the labour power.

    Based on this, Roberts comes up with a graphic rather unlike that of the CPI:

    Comment by louisproyect — November 15, 2012 @ 8:07 pm

  13. Hello Louis, first I am a former CPGB member and certainly am familiar with Marx’s “famous formula”.

    I am also quite familiar with the fact that the labour theory of value is a useless concept that has been abandoned by academic economists and indeed was abandoned in the USSR. You may not be “that familiar” with the work of academic economists but why not start with that of Joan Robinson: http://www.jstor.org/discover/10.2307/40400250?uid=3739832&uid=2129&uid=2&uid=70&uid=4&uid=3739256&sid=21101442145837

    Finally, why not try to engage with people rather than calling them “trolls” after all you certainly become very hurt when others accuse you of the same (see your tantrums on the stalinist nostalgia site Socialist Unity).

    Comment by Harsanyi_Janos — November 16, 2012 @ 12:08 am

  14. Well, you are exactly right. I was trolling Socialist Unity and should have stopped it years ago after I figured out how fucked up it was. In a way I am glad that Newman and Wight started deleting my posts since it was the little bit of a nudge that I needed to de-bookmark it. Let’s see how you make out here…

    Comment by louisproyect — November 16, 2012 @ 12:20 am

  15. I didn’t realise that you were posting there merely to bait them; I assumed that you were posting for the same reason as I think Paul Fauvet posted there.

    Comment by Harsanyi_Janos — November 16, 2012 @ 12:24 am

  16. Fauvet tries to have a serious conversation there, an almost impossible task. I like to bait Andy Newman since he has such a thin skin. Generally I don’t have much patience for assholes like me using my own blog to start pissing contests. That’s why I keep people on a short leash and the lever to the trap-door close at hand.

    Comment by louisproyect — November 16, 2012 @ 12:29 am

  17. I see; I think that Newman is a very good argument for why one should not be an autodidact. As for me; quite possibly I am an arsehole, but I am not actually a troll. Its your blog, of course so feel free to block me if you wish.

    Comment by Harsanyi_Janos — November 16, 2012 @ 12:39 am

  18. Anyone have a good recommendation where I might learn about the falling rate of profit? And for that matter why do some consider the “labor theory of value” useless?

    Comment by Pandora — November 17, 2012 @ 7:53 pm

  19. I don’t think the Labor Theory of Value is useless. When some hired Geologist tells the bosses of a mining consortium that there’s five hundred million dollars worth of gold in some mountain — the bosses understand the gold is worthless without the labor to extract it.

    Obviously the above is a simplistic reduction but the old anarchist credo still rings true: labor creates all wealth.

    Comment by Karl Friedrich — November 22, 2012 @ 3:13 pm

  20. If not labor then a man might wonder where wealth comes from at all. A day ago I remembered that everyday people accept the labor theory of value naturally. Were you to ask someone why something is worth whatever it is worth they will likely answer: because of the labor that transformed the base components into whatever the commodity is. If not that then what? Magical fairy dust that is only created within the Board of Directors’s Coven?

    Comment by Pandora — November 22, 2012 @ 6:54 pm

  21. Karl Friedrich @19: “[...] the old anarchist credo still rings true: labor creates all wealth.”

    Karl Marx, Critique of the Gotha Program: “Labor is not the source of all wealth. Nature is just as much the source of use values (and it is surely of such that material wealth consists!) as labor, which itself is only the manifestation of a force of nature, human labor power.”

    Comment by Red Snapper — November 30, 2012 @ 1:22 am

  22. [...] Who says the Koch Brothers and Sheldon Adelson wasted their money? (louisproyect.wordpress.com) [...]

    Pingback by Sheldon Adelson Spent Far More On Campaign Than Previously Known « The Fifth Column — December 3, 2012 @ 7:08 am


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