The rise in trade, the reassertion of financial power, outsourcing of technological development, and the ascendance of an Oligarchy Executive Class have had dramatic effects on the US Industrial Corporations, the way they're run, and their declining position in the world.
Labor has always faced a threat from technology, but its implementation requires effort, imagination, and expense. The results create new types of jobs even as they destroy old ones.
But, trade isn't just a threat to domestic labor; it undermines every employer's market strength and in so doing undermines labor's leverage over employers. Outsourcing throws out labor to save the firm.
Clinton presided over an economic boom which joined the superrich and the Democratic Party for the first time. Our technological achievements fostered full employment without inflation, a decline in unequal pay with a rise in our standard of living, transformed our worldwide image, leapfrogged Europe & Japan, and strengthened the dollar. Then it stopped, just before Clinton left office.
Bush had no interest in the declining hi-tech industry, he governed on behalf of a small group of plutocrats in oil (extraction industries), media, drugs, health care, housing and finance. Income inequality soared and because of that unemployment rose.
Through the tenure of these two Presidents, a new wealth class emerged, interested exclusively in their bonuses, tied to stock prices (i.e. Wall Streets expectations). Running a company, planning, competing in global markets was too much fucking trouble for them. Why perform risky work when you could cook the books, buy an accounting firm or ratings agency, and control the power and instruments of the State?
As our Industrial State was reshaped, the Banker, Venture Capitalist and Wall Street reestablished the powers lost after the Great Depression. Getting rich no longer took time, talent, perseverance. Getting rich just meant getting the approval of the capital market. What began in the hi-tech industries corroded the structures and rewards of older larger more competitive Industries. An explosion in CEO pay ensued, removed from any false notion of supply and demand for labor. Shrub created a new entrepreneur, devoid of ideological restraint, focused solely on Government as a vehicle for private profit on a continental scale.
This is the Predator State. It is a coalition of relentless opponents of any regulatory framework which considers the future common good, whose enterprises compete with or encroach on the public functions of the New Deal. It has two objectives, undermining the public's best interests and profiting from previously exclusive public endeavors.
Excerpted from Galbraith's "Predator State"
