Guest Blog by Thomas Palley

From the TPMCafe Book Club

Social Origins of the American Corporate Predator State
By Thomas Palley - August 12, 2008

It is important to understand the origins of the American corporate predator state because understanding is a necessary part of developing responses for caging the predators and replacing them with another better order. Those origins clearly trace back to the military - industrial complex that President Eisenhower warned about in his final televised address to the nation on January 17, 1961.
That complex has corrupted and captured politics and the business of government, including of course the conduct of national security policy. The fact that it has wrapped itself with the flag and entwined itself with the military makes it impossible to confront without being charged as unpatriotic. Worst yet, its enormous enduring profitability has provided a model for imitation by other industrial complexes like Big Pharma and Big Oil.
The political success of these predators is clearly linked to money's role in politics. Money gives the power to buy the political process, and that power is defended by a gospel of free speech that takes no account of the fact that out-shouting someone is qualitatively equivalent to silencing them. Economics also comes to money's defense with its absurd myth of a market for ideas in which participants compete on a level playing field and truth is effortlessly sorted from error.
The American worship of business and businessmen, which Sinclair Lewis (Babbitt, 1922) wrote about long ago, also plays a role. This worship privileges business over thought and other activities, and is behind the dismissive sneer "if you're so smart how come you are not rich?" As a result, Americans are all too willing to hand over their government to business predators. Today, it is in Goldman Sachs we trust.
Another feature of business worship is a tendency to conflate profit with free markets. That means the distinction between fair competition (which is good) and fat profits (which are bad) is lost, thereby providing cover for predators.
Lastly, there is the legacy of the Cold war which contributed to economic dumbing-down and suppression of awareness of class and class conflict. This suppression was seen as necessary for blunting the dangerous appeal of Soviet communism, but a consequence was to create blindness to the predators in our midst.
All of this reveals a deep deficit in America's social and economic understanding (some deficits really do matter). And as long as the deficit remains, the predators will have a starting gate advantage in the game of political persuasion.
Yet, how to close the deficit and insert another understanding is an enormous challenge. There are deep institutional obstructions in the academy, media, and elsewhere. Moreover, raising these issues may create unsettling cognitive dissonance that pushes voters into denial and a closer embrace of the predators.
In effect, there is a paradox to be solved. Lasting progressive political victory requires transforming understanding, but the immediate political incentives are aligned to discourage engagement with such a project.