The Capitalist Baby in the Bath Water And the Green New Double Trick

I am not convinced like some on the left, that we have to dismantle everything in order to save the world. If the culture and habits of our political class stopped legislating the whims of corporations, billionaires, and multinationals, and started to consider the will and the health of people and planet, we could effect the massive and necessary change. As I write, I can hear the self-assured scoff from those whose cynicism convinces them of my naivety, but stick with me. The will for such a change is palpable in our political moment, and there are popular candidates in both the US and the UK who would steer us towards such a change.

The changes required for such a shift are not as complex and implausible as we have been led to believe. Our economic system has a well-trained aura of immutability. A lot of that comes from what Linda McQuaig calls the ‘Cult of Impotence’. Establishment politicians and pundits are really good at not being able to do much. They tell us that regulations and taxes kill economies, and banks are just too big to fail, so their hands are tied. They assure us that we can’t afford the economy that the electorate wants, and, by the way, socialism is a scary word, it sounds kind of like communism, and do you really want to live in a failed state like Venezuela?

First of all I don’t believe capitalism is a baby that needs to be tossed out with the bath water. It just needs to be heavily regulated and guided by justice and science, and, may I be so bold, by the will of a people who are not coerced, propagandized, and deluded by narratives that are written by P.R. firms funded by the Koch brothers.

To be fair, we don’t have capitalism now. At least not the ‘free market’ capitalism that we are told we have. We have a heavily regulated economic system that has been written by very wealthy people. When progressives and lefties push for the end of capitalism, I’m never quite sure what they mean. I don’t think most want the end of private ownership of property, and I don’t think they want every corner store to be owned and operated by the state. What they really want is heavily regulated capitalism. Which ironically is what we already have. We live in a regulated market. But the regulations are designed to enrich a tiny minority of very wealthy people.

What progressives are calling for is an overhaul. We want fundamental change in how and why and who gets to design and operate the levers and pullies that make up the regulatory regimes in our capitalist economy. We call those kinds of capital market regulations socialism.

Present market regulations have legalized tax-free havens in places like the Caymen Islands and Luxemburg. The amount of corporate money that is earned in the US and then hidden in overseas tax shelters is ludicrous to the point of disorientation. It is hard to get one single data point on exactly how much corporate revenue is ‘registered’ overseas, but the forfeited tax revenue is way more than enough to pay for any and all social and environmental programs that a progressive might consider important. Green New Deal, Medicare for All, Free Tuition and Student Loan forgiveness would all be ‘gimmes’ if the money earned by corporations in the US were taxed in the US. A brief bit of Internet research got me these numbers:

• In just the top-10 countries, $18 trillion in value - some 40 percent of cross-border direct investment logged by the International Monetary Fund - is being stowed away with corporate tax rates of 3 percent or less.

• About half of all the foreign profits of US multinationals are booked in tax havens.

• A May 2012 study by J.P Morgan analysts found that multinational corporations have over $1.7 trillion in undistributed foreign earnings

There is a deceptive narrative that these tax havens are some kind of trick that corporations are pulling. That some greedy corporations have found ‘tax loopholes’ and are cheating the system. The implication is that if regulatory authorities caught them, the money would be repatriated and those running the scam would meet justice. This is exactly not true. People who write corporation and tax laws have deliberately constructed the rules such that corporations can avoid paying taxes on the majority of their income. The regulatory agencies protect this system.

An overhaul of these regulations would be life changing and planet saving. There are plans and ideas about how we might ‘close these loopholes’, but they don’t get a lot of attention from a system that wishes to expand the loopholes and deregulate the economy in order to create 'a favourable business climate'.

I had an argument the other day about the Green New Deal. I quoted a surprising and encouraging statistic. 80% of Americans are in favour of a Green New Deal. My arguing partner retorted: ‘Well ya, except they don’t really mean it because when asked how much people are willing to pay for a Green New Deal, people say something like less than 100$ per year.”

The polling question and the newspaper that published it are playing a deceitful game. In order to undermine the Green New Deal, the media and those that parrot its logic strive to convince people that it will require massive sacrifice on behalf of the dwindling middle class. The argument assumes that the money required to get the Green New Deal off the ground is going to have to come from the pocket books of the economically abused and mistreated. 80% of citizens want a Green New Deal, but most don’t want to spend more that $100 on it. These two statistics are put together to suggest that the Green New Deal is impractical because Americans are lazy and selfish and greedy and short sighted. It is worth noting that not only do 80% of Americans want a Green New Deal, but another 80% of Americans live from Pay Check to Pay Check. They can’t afford a massive bill to save their grandkids and the planet. They can’t afford to buy healthcare or fix their furnace.

There is double trickery at play here. First of all the Green New Deal is specifically designed to help lift people out of poverty and despair. It will offer secure union jobs to millions of Americans. The Green New Deal is not a burden to the poor but a life raft. And secondly, there is plenty of money in the economy to pay for a massive green investment. As discussed above, closing tax havens alone would do the trick. A Green New Deal will unrig the economy that has been systematically rigged by billionaires. So asking if the poor are willing to pay for it and shaming their response is a nice bit of deceptive gaslight.