Lessons from China About Fighting Oligarchs

If you want an example of a country that’s actually taking action against corporate corruption, look no further than the People’s Republic of China. Seriously, I’m not kidding.

Since President Xi Jinping took power in 2012, his government has unleashed all hell on the leadership of China’s coal and oil industry. It has jailed powerful executives and, at the same time, unveiled a slew of new rules aimed at combating pollution, which remains one of that country’s biggest problems. The data shows that this so-called “war on corruption” has been a success: In 2014, China’s coal use and carbon emissions declined for the first time in more than a decade.

Now, there are questions about the real motive behind China’s crackdown on corporate criminals - it probably has just as much to do with consolidating power as it does fighting corruption - but there’s still a lot we here in America could learn from what President Xi Jinping is doing across the Pacific. That’s because we’re a country run by oligarchs who operate with total and absolute impunity.

Don’t believe me?

Consider this: It’s now been more than six years since the Crash of 2008 and the Justice Department has still yet to prosecute any head of any major bank for what was arguably the biggest financial scandal of all time.

This isn't likely to change anytime soon, either. Attorney General Eric Holder basically admitted a few years ago that some banks are “too big to jail” and U.S. Attorney Loretta Lynch, our likely next Attorney General, has a checkered history when it comes to fighting financial crime.

Oh, and as if all that wasn’t bad enough, much of what government has done to hold the banksters accountable for their actions during the financial crisis has actually helped those banksters out. Most of the $13 billion settlement the Justice Department reached with JPMorgan back in 2013, for example, was tax deductible.

With this recent history in mind, China’s crackdown on corporate criminals and pollution looks all the more impressive.

And while part of China’s success has to do with the fact that it’s an authoritarian regime that doesn't have to answer to the checks and balances of a democracy, it’s important to remember that just a little over a century ago America - yes, America - was the scene of a great corporate crackdown of its own. The man who led this crackdown was none other than the Bull Moose himself, Teddy Roosevelt.

After he became President in 1901, Teddy, to put it bluntly, took the robber barons to the woodshed.

At the time, billionaire industrialists like John D. Rockefeller and Andrew Carnegie were as powerful as monarchs, but Teddy used the Sherman Antitrust Act to break up their monopolies and once again open up the economy to real competition. He also pushed through the Hepburn Act to put a limit on the outrageous railroad rates that were breaking the bank of small businessmen all over the country and, unlike previous presidents, forced corporations to actually sit down and talk with unions.

All of these actions were part of “The Square Deal,” the first real modern attempt to take on the economic royalists, and they helped take American out of the Gilded Age and into the Progressive Era.

Today, we’re in need of a new Square Deal. Ever since Reagan stopped enforcing the Sherman Antitrust Act in 1981, big businesses, especially big banks, have ballooned in size. In fact, the big banks are even bigger now than they were before the crash.

The success of China’s “war on corruption” shows that it is possible to take on entrenched corporate power and win. But we didn't need an authoritarian regime to tell us that. Our own history and the history of one of our greatest presidents, the progressive Republican Teddy Roosevelt, is proof that democracies can also take on the oligarchs and win.

All we need to do is start enforcing the Sherman Antitrust Act. It’s as simple as that.

Comments

stecoop01's picture
stecoop01 7 years 38 weeks ago
#1

We don't need a 'new' square deal; we just need to dust off the old one and put it back to work. And there's no such thing as 'too big to jail' - the collapse of a big bank would be an economic punch in the gut, compared to the pounding migraine of financial corruption.

And just for the record, China doesn't just jail people for corruption...some of them they execute. Hmmm, maybe we should try that in this country.

chicagotim's picture
chicagotim 7 years 38 weeks ago
#2

We've had a "progressive" and interventionist President and Attorney General for the past six years. Perhaps you should call them out directly?

SHFabian's picture
SHFabian 7 years 38 weeks ago
#3

America has a profoundly different situation. Liberals promote a notion of the "1% vs. the 99%," and this simply isn't correct. What the rich are now doing to the middle class is what the middle class already did to the poor. The proverbial "masses" -- those who had united to push back during similar times in our past -- have been deeply divided and pitted against each other.

DAnneMarc's picture
DAnneMarc 7 years 38 weeks ago
#4
Quote chicagotim:We've had a "progressive" and interventionist President and Attorney General for the past six years. Perhaps you should call them out directly?

chicagotim ~ Really? You could have fooled me. All I have seen in the past 35 years are a series of Corporate lapdog Presidents. If you don't think Thom just "called out" every President since Carter, you'd better reread the article above. This time, put on your glasses.

SHFabian's picture
SHFabian 7 years 38 weeks ago
#5

No, we haven't had that. President Obama never said he was a progressive, and indeed, from the time of his first campaign, he stressed that he is a "pragmatist." Nevertheless, esp. on socioeconomic policies, he has been far more progressive than the media marketed to middle class libs. What we've had from the latter is another six years of ignoring our poverty crisis (with VERY rare exception) while focusing on appealing to the better off, the middle class alone. Meanwhile, the right wing of the Dem Party in Congress continues to ensure the passage of Republican legislation.

On a related point, what are we to think about a lib media that went into overdrive to try to sell (neoliberal) Hillary Clinton in place of VP Joe Biden as the 2016 Dem Party candidate? The bottom line is that there has been no public call for a legitimately progressive socioeconomic agenda.

SHFabian's picture
SHFabian 7 years 37 weeks ago
#6

Complex issues, but from another perspective: We need to restore and preserve the New Deal. Now, what came to be called AFDC was actually first included in FDR's Social Security Act. Bill Clinton ended that, and began similarly "reforming" Social Security itself, targeting the disabled. In fact, by 2000, the disabled became the fastest-growing group of homeless Americans. President Obama finally restored disability aid, but the (Clinton) Dems in Congress promptly began cutting again. For the upcoming budget, Dems are either considering, or have already agreed to, deep cuts to the disabled, far exceeding those made by Clinton.

Unfortunately, we looked at the policies and programs that were implemented from FDR to Reagan, which took the country to its height of wealth and productivity, and CHOSE to do the direct opposite. We got rid of the agenda that created the massive middle class we used to have. The inevitable has been happening. Lib media have largely ignored these issues to appeal to middle class consumers and campaign donors alone.

Loren Bliss's picture
Loren Bliss 7 years 37 weeks ago
#7

"All warfare is based on deception" -- Sun Tzu, c. 500 BCE

Knowing something of the history of our species' long and mostly unsuccessful struggle for economic democracy -- knowing also just a bit about the Chinese revolution -- I have always found the apparent Chinese embrace of capitalism perplexing. East Asian civilization, with a cultural continuity extending back at least 5,000 years, has no counterpart on this planet. Though the civilizations of Europe and the Middle East are equally old, the inherent savagery of Abrahamic religion has ensured the total suppression of all of the cultural wisdom of these region's first 3,000 years, with the result that -- never mind for example our European DNA can be traced to the paleolithic-- we "barbarians" (for that is how East Asia regards us) -- are, culturally speaking, mere children. For this reason China has always seemed to me far better prepared to resist the deadly temptations of capitalism, which in truth is not just an economic system but an entire universe of hierarchy, governance and exploitation based on a single precept: that there is no greater virtue than greed. Thus I was genuinely astounded when the People's Republic of China seemed to adopt the very ideology against which its people had fought for most of the first half of the last century.

The easy answer, of course, was that the Chinese government had been infiltrated and co-opted. But that never felt right to me -- and though now I was in the realm of gut feelings and journalistic intuition rather than facts or even factually based speculation -- I began to suspect the Chinese were (again) following the principles of Sun Tzu, one of which is defeating an enemy by turning his greatest strength into his greatest vulnerability.

Viewing the relationship between China and the United States from this perspective, it appears China has used the bottomless greed that is capitalism's greatest strength to seduce the U.S. with cheap labor and endless credit and so ensnare it. The U.S. no longer has an economy; it's manufacturing capabilities have all been outsourced -- mostly to China -- and it is as dependent on Chinese money as any junky is dependent on the pusher for the next fix. When the incipient U.S.-Chinese conflict ends in war, as is inevitable, the U.S. will have its master-race ideology of divinely ordained "exceptionalism" and the Fourth Reich arrogance of its military omnipotence and the zomboid submissiveness of its Moron Nation masses as cannon fodder but none of the manufacturing capabilities essential to a sustained conflict. That is why the better-dead-than-Red capitalists will most likely try to nuke China into quick surrender and by so doing will destroy the world instead. Any other sort of war -- that is, a conventional and therefore extended war -- the U.S. would lose precisely because it no longer has an economy of its own. (Ironically, the same conditions -- lack of economic depth and manufacturing capabilities -- are what defeated the Axis in World War II.)

But what if China did not really embrace capitalism? What if China's embrace of capitalism was merely an expression of Sun Tzu's principles in present-day strategy? What if China today is as Communist -- that is, as committed to real economic democracy -- as it was under Mao Ze Dong? The relentless prosecution of capitalists reported by Mr. Hartmann suggests this is may well be the case. If this is so, the global Working Class has precisely the powerful ally it hitherto seemed to lack. Remembering that it was the Russian Revolution and the rise of the Soviet Union that terrified the world's capitalists into making all the humanitarian concessions of the last century, the implications for the future are profound indeed.

RLTOWNSLEY's picture
RLTOWNSLEY 7 years 37 weeks ago
#8

The Square Deal, The New Deal, and now The Raw Deal !

Far too many citizens are afraid to take action that may lead to the dissolution of this government as it now stands. The ongoing removal of those programs and laws that were crafted over the years to protect average citizens as they counteracted periodic attempts by various special interest groups that sought to change government structure to a system that catered exclusively to them has resulted in an empty shell that no longer provides any meaningful promises to average American citizens. Given the ongoing dismantling of those past achievements over past decades, not much remains to be preserved as the Capitalists masters who have been continuously financed by American taxpayers over the past century have now abandoned this country to increase their profits on the backs of cheap third world labor leaving this country and it's citizens in ongoing financial collapse as government is occupied exclusively by the wealthy oligarchs. No past obligations remain so let's take out the garbage and start over !

chuckle8's picture
chuckle8 7 years 37 weeks ago
#9

Loren Bliss -- You have outdone yourself. Your reading of the tea leaves is very interesting. Thanks. - c8

I assume you, like me, hope you are wrong. I hope for someone like FDR, but who can forsee someone like Lewis Powell coming along. -c8

Loren Bliss's picture
Loren Bliss 7 years 37 weeks ago
#10

Thank you, chuckle8. For the first third of my adulthood I considered myself a "lifelong Democrat," rationaizing LBJ's monumental betrayal of his own self-proclaimed quest for world peace (proven a Big Lie by the Gulf of Tonkin incident and the subsequent Vietnam War) as necessitated by what Bismarck so aptly named realpolitik. I even managed to overlook, for a while, Carter's viciously theocratic betrayal of U.S. womanhood implicit in his approval on the Hyde Amendment. But I could not ignore Clinton's savaging of the working class, whether via NAFTA or the deliberately genocidal malevolence of welfare "reform." Nor could I abide the forcible-disarmament fanatacism that has consumed the Democratic Party so totally that I who in 1963 went to jail for the cause of African-American civil rights have been called to my face a "Nazi" in in response to my support of the Second Amendment. Thus since the 1990s -- actually the late 1980s -- I have therefore been a man without a party.

That said, I too would vastly prefer election of another Franklin Delano Roosevelt (whom I believe was by far the greatest president in U.S. history) over any of more probable alternatives, each of which would be severely destructive to the land I love. But the conditions that forced the nomination and election of FDR -- note the initial verb -- will never again be allowed to obtain. These were a large and rebellious progressive element within the Republican Party -- the "original" Republicans if you will, whose humanitarian ideology was a legacy from Lincoln; a parallel faction within the farmers and industrial workers of the northern Democratic Party; and -- the third largest U.S. party ever -- the Communist Party, the most successfully efficient political organization the U.S. has ever known, complete with the support of the Soviet Union and what may yet prove to have been the most formidable intelligence apparatus in our species' history, not just the OGPU (precursor to the KGB), but the lesser known yet far more effective GRU, Glavnoye razvedyvatel'noye upravleniye, the Intelligence Directorate of the Red Army General Staff. Such was the United Front -- farm and labor Democrats, progressive Republicans, Communists and socialists -- that put FDR in office and kept him there until his death on 12 April 1945. His accomplishments included not only the New Deal, but literally saving the world by defying the Bankers Plot conspirators of 1934 and thus keeping the U.S. from becoming the fourth and ultimately dominant member of the Rome/Berlin/Tokyo Axis.

Significantly, the Russians have always believed FDR was murdrered by the same too-rich-to-prosecute One Percenters who had tried to overthrow him and impose a fascist government. That probability is surely reinforced by the fates of the only two U.S. politicians who have truly tried to follow in FDR's ideological footsteps, John Fitzgerald Kennedy and his brother Robert Francis Kennedy. As I said when RFK was murdered -- at the time I was the news editor of one of the larger New Jersey dailies -- "there goes the last man who could have saved us from ourselves."

Thus the likelihood of "someone like FDR" rescuing the U.S. from the cesspool of fascism in which it is drowning is akin to that of the proverbial snowball surviving in hell. Were such a savior to attain power, he would no doubt be assassinated: welcome to the biggest banana republic of all time. But the greater probability, given the methodical Ayn Rand conditioning that has reduced the U.S. electorate to Moron Nation (note the results of the 2010 and 2014 elections and the near-certainty of Republican victory in the 2016 presidential election), is that an FDR-like candidate would merely be jeered off the political stage by voters so greedily infatuated with their cellphones, automobiles and other instruments of enslavement, any notion of genuine freedom has become too alien to consider. And even if it were not, the combination of Randite my-way-or-no-way selfishness and deliberately fostered ignorance that characterizes even the best-intentioned U.S. citizens -- note for example the collapse of the Occupy Movement (which I witnessed firsthand) -- ensures they have been moronated (dumbed down) to abject powerlessness. Such were the psychodynamics of Nazi Germany in the late 1930s -- which strongly suggests a people so conditioned can never be awakened by any means short of foreign conquest.

I am not, therefore, optimistic. As Winston Churchill reportedly said on the eve of the Battle of Britain, "only a miracle can save us now." But I will probably never know whether we are rescued or not, as I am less than two weeks from my 75th birthday. And -- speaking frankly -- the only future I can logically foresee, that of an old man increasingly afflicted by the genocide of asuterity as part of a doomed species on a dying planet, makes me profoundly angry and sad and profoundly thankful I will probably not live to see the worst of it.

Mark J. Saulys's picture
Mark J. Saulys 7 years 37 weeks ago
#11

Loren Bliss, China remains a nominally Leninist state, i.e., it remains a nominally benevolent dictatorship and this newest autocrat could actually BELIEVE all that political theory.
Under him this embrace of capitalism could be a Chinese version of Lenin's N.E.P..
I give you two quotes. The first is from Xi's predecessor, Zhang Zhemin, "To get rich is glorious."
The other is from Lenin, "We're going to hang the capitalists and they're going to sell us the rope."

geonomist's picture
geonomist 7 years 37 weeks ago
#12

You wonder why government is broke? You want to know how outrageous fortunes get made? This is how the real world works.

Want to fix it? You must end the discretionary spending of politicians. Instead of government funding “guns and butter”, you’d get a dividend and hire your own teachers and doctors.

What’d be the source of the revenue? Rent. The worth of Earth. All our spending for the land and resources we use. It’s a surplus, since nobody needs to be paid to produce nature. And it’s ours, generated by the presence and needs of society. Share this common wealth — society’s surplus — and you’d need not worry about misspending and unearned fortunes ever again. More at Progress.org.

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