This is another of those brilliant analyses by Michael Hudson should you wish to understand the world. Michael on Pelosi’s visit to Taiwan and the increasing self-confidence of nations opposing the declining US hegemony
Michael Hudson is the author of Killing the Host (published in e-format by CounterPunch Books and in print by Islet). His new book is J is For Junk Economics. He can be reached at mh@michael-hudson.com
Cross-posted from Michael’s website
Photo: United States Army
Interview of Michael Hudson by Andrei The Saker, August 2022
Transcript
Key: ATS = Andrei The Saker; MH = Michael Hudson
ATS
Well first of all, Michael, a huge, huge thank you for agreeing to this conversation. It’s a big pleasure for me to have you here, it’s a big honour too, and I really look forward to getting your insight as to what’s happening, ’cause there’s a lot happening right now. The first thing I want to ask you about is a current event then we can go into deeper things. What do you make of Pelosi landing in Taiwan and how do you see … what is this all about, what’s happening here?
MH
Well I think in what you just wrote today you made it all clear. There’s really no practical effect of what she did, so why should China have actually done something military and then something provocative. What Pelosi did is a public relations ploy, she wanted to get more votes in California, and one third of California are Chinese and she thought that that would help. So why should China react materially to something that is just a stunt, and I think you’re quite right, best to wait and see what the outcome of this is. We have no idea … midnight there, so we don’t know what is happening or will be happening. We don’t know what the Chinese will do, especially seeing that the downward direction of US relations with the rest of the world is, it’s bungling everything clumsily so you don’t want to interrupt it while it’s doing that. Let’s see where it goes.
And the rest of the world is seeing just what you’re seeing, the US is pulling a stunt that is a very dangerous stunt and it’s trying to use salami tactics, a little bit here a little bit there just keep pushing and cutting and see what’s going to happen. I think there’ll be indeed some time that China responds when it’s appropriate and the time will be of China’s choosing not that of the United States.
Other countries are seeing how reckless the United States is and that’s building up a resentment not only in China but in other countries, we’re all being endangered by this. We don’t know what the US is going to do. At least in the 1970’s, when President Nixon had the strategy “let them think I’m crazy and they’ll never know what I’m going to do”, that was a ploy but the fear of the world now is that the people really are crazy that are running policy, and not a ploy! They really don’t know what they’re doing and they’re like a bull in the china shop.
So what’s so frightening is that both parties are using this visit … they’re manoeuvring for elections for the Congressional elections this November in the United States and both parties seem to think they can get more votes by threatening the rest of the world by being America first by just saying we’re the unique nation and we can do whatever we want and you’re going to have to adjust to us, look how strong we are, that’ll get votes. There’s no anti-war movement here and what passes for the left actually seem to be on the NATO side ..
ATS
Yes!
MH
… the world is seeing, the world is seeing that.
ATS
We see that very clearly even in Europe the same thing, the so-called left is the worst Atlanticist of them all. But you know what really scares me is that, OK, politicians they want votes, they do political stunts, that’s fine, but the risks involved in that stunt are truly immense and what I think what a lot of American politicians are missing, but also the general public, is that militarily speaking, the other day I was listening to an interview of Andrei Martyanov and he made a very good point. He was asked “Do you believe that the US can prevail in a war against China?” and he said “Well only on one condition, a full scale nuclear war.”
MH
(laughs)
ATS
Short of that there’s nothing, and even in case of a full scale nuclear war first of all, you know, that has never been modelled on computers but we don’t really know what would happen and secondly I do not believe that Russia would let that happen. So, the comparison, I call that a game of nuclear chicken, and what really I find depressing is that during the cold war which I remember well, I mean I was relatively young, I’m 58 now, but I remember the cold war and the mood and a lot of my teachers when I studied in the US were from the Pentagon, government accounting office, office of net assessment, etc. All these senior American officers had an acute sense of responsibility, that is “Yeah, the Soviets are the enemy, understood, we will fight them, understood, but we both, the Soviets and us, have such a weapon in our disposal that the prime directive really is “never allow a pretext for nuclear war”.
And there was an article by a Russian Marshall called Agarkov who wrote about that and then Reagan picked it up and his famous line like “You cannot win a nuclear war” is true I think. The thing is that the acuteness of that perception, that forget about what’s at stake, we just cannot allow those two countries to exchange hundreds or thousands of nuclear warheads because we’re gonna threaten the entire Northern Hemisphere. This is now subordinated to Pelosi’s need to cater to the Chinese immigrants in California? That’s frightening to me!
MH
Well also it shows that the Pentagon, that I understand did not want her to go, the Pentagon has lost control to the State Department. I remember back in the 1970’s during the Vietnam war when my boss Herman Kahn brought me to have dinner with one of the big generals who, I don’t want to say who he was, but he was the leading general in Vietnam for strategy, and Herman said the one thing, you can’t be rude to him, you’re just there so you can see and hear him, and the whole discussion the general felt the war was crazy, we couldn’t possibly win it, any country defending itself and its own National Government against an invader is always going to win and Vietnam had looked always at China as the main threat, and not the United States, and America backing the French, you know, was absolutely crazy and I had never heard as eloquent an argument against the Vietnam war from any of the anti-war people and here were the generals who obviously that was not what the State Department was saying, that was not what Nixon or Kissinger was saying, and I don’t think the army today is still as independent as it was fifty years ago.
I think that the army is like the CIA, you get ahead by agreeing what the politically appointed officers are, so the army has been badly politicised in the United States. Even so because it’s an army it’s realistic about military matters and the State Department isn’t. They’re operating on emotion and on a world view that is inherently hostile.
ATS
Let’s look into that “inherently hostile” thing a little deeper, because I think you made some very interesting points in your articles and I would like to discuss them. I’ll begin if I can with just a few quotes. Josep Burrell said “The war will be long and test the strength, we’ll last, we have no other choice, allowing Russia to prevail will mean allowing it to destroy our democracy and the very basis of international rules-based order.” And then the EU commissioner said “We clearly see the impact. The best way to deal with the economic consequences is to finish the war, to provide Ukraine with the necessary support.” OK.
Yale University professor “Russian imports are largely collapsed in the face of stark challenges, securing crucial inputs, parts and technology from hesitant trade partners.” So, these people are openly saying that they’re in essentially, I mean I think it’s accepted now, Russia and the US are in a full, existential war, that the US is trying so far to wage by proxy and keep below the threshold of overt direct confrontation.
Now, here’s, before I ask you a question, one thing that I want to say just for those who are listening to us. We are used to being conditioned by TV, Hollywood, Tom Clancy and the outcome of certain wars, which were misunderstood in that myth that the US and NATO is a really powerful military alliance. And that’s a fallacy, it’s a complete lie.
If you look at the US military globally, I won’t go into details today, I would say the only branch, there’s two branches that I would consider combat capable, nuclear forces, they’re old, they’re getting there, they had problems but I do not believe that they came to the point where they can’t execute their mission; they’re struggling but they can do it. And secondly, American nuclear attack submarines, of which there are lots as they are high quality, and that’s kind of it.
The aircraft carriers are sitting ducks, the Air Force is in terrible shape, the Army, forget it, couldn’t win a war against, you know, a kindergarten. So the Pentagon must realise that, what are they looking at, if they continue doubling down they’re looking at one of two options, a land war against Russia, a continental land war, which they don’t even have the means in Europe today right now, and would take them months, and months and months to get the kind of firepower and logistics and personnel and training and coordination, etcetera, to be ready for that, or a nuclear exchange with Russia. That’s it, I mean there’s no third option. So these guys should know that going down the doubling down road leads to disaster. I mean, as I wrote in a recent article, the most what the US could do is fire a large amount of subsonic or slow cruise missiles, which either will pass or will not pass. But option one, lets say they don’t pass, like the strike on Syria was a failure, in that case you just shot your best weapon and your out, or they do pass and do inflict actual damage on Russia. What do they think the reaction of the Russians will be to this, and what do they plan, I mean what’s the next step? I don’t see it, do you?
MH
Well, let’s look at the reciprocal implications of what you say. Just like the United States can not mount a land war, and invade any country, neither can any other industrial nation anywhere; maybe China could given its population, but certainly Russia could not mount a land war to move back, to retake central Europe and move into East Germany …
ATS
You’re right.
MH
… nobody could. Any population would all of a sudden, all of the students would become draft dodgers, there would be protests, no country can afford a land war, that is a tactic that is no longer part of the repertory except maybe for Iraq and Iran, you know, small countries and local tribal wars in Afghanistan.
So the question is, what is, why is NATO even preparing for all this expense as if there were, it could have a land war or Russia could have a land war? Well the only explanation I can come up with is that the arms that NATO has spent two percent of its GDP, or supposed to have spent two percent of its GDP on, really are not for fighting. It’s like when you auction hundred year old wine, this wine is not for drinking, this wine is for trading.
ATS
Yes!
MH
Arms are to employ people in the election districts of American representatives and French and European representatives. They’re arms just to create profits for the war makers, they’re not for fighting and so the whole idea that there can be a land war is fictitious, on either side. And once you realise that there is not going to be a land war, the only thing that America has is bombs, as you point out. The question is, what kind of bombs? We’ve seen the bombs that were used to destroy Afghanistan, and the near East and Lybia, everything from that up to a gradation of true atomic bombs That’s the only thing in the US repertory, so it’s muscle-bound, that’s the problem.
ATS
But, before I say, I don’t even agree about the bombs …
MH
Ah, quite right!
ATS
… because the US never faced integrated air defences.
MH
Definitely
ATS
Multi-layered, you know, air defences that are specialized in protecting forces to national air defences.
MH
This is the point I made in 1978 in my book “Global Fracture”, that the … it’s much cheaper to defend than to make an offence. (? indistinct ?) an enormous amount and is obviously pretty successful in being able to shoot down NATO and US missiles.
ATS
But notice that after Iran hit America’s Centcom bases …
MH
Right!
ATS
… they even didn’t have what it takes to take on even Iran!
MH
That’s right!
ATS
With all my respect, and I do have a great deal of respect for Iran, that’s not the kind of integrated air defences with automated command sys … er, you know computers that automate warfare, etc., that Russia presents. I mean there’s a reason why the US never even considered putting a no-fly zone over the Ukraine, it’s because they’re gonna, the air defences, they have nothing against it. They don’t have the correct ant-radiation missiles, they don’t have the correct aircraft, it’s not gonna work!
I mean, the only thing that I see working is the good old Harpoon missiles fired in large amounts which could do limited damage, but they’re not very powerful, they’re not very fast and they’re not very hard targets. So all they have is really nothing much in terms of what are they gonna do. And so Russia, I agree with you completely, that Russia doesn’t have the means to invade, you know, Europe, etc., but if you look at the Russian military posture, the goal of the Russian military is to protect her borders roughly five hundred to maybe eight hundred kilometres away from it; that is to say that if the US even moves that close to the Russian border. Forward deployment was very popular because of Carter, the Gulf and everything, you know, the pre-positioning of equipment, but in modern warfare, where there is no front and back and where could Russia strike at any depth; Russia could land a cruise missile in Portugal if she wants. Even that is not gonna be helpful. So what’s the scenario?
MH
Let’s suppose that the people in Washington who run NATO are smart enough to listen to your blog, and that they understand everything that you said. Then, why are they doing all of this? They’re not supposed to win, they’re not supposed to beat Russia, they’re supposed to do exactly what President Biden said, is that for every Ukranian that we send, Russia is gonna lose another bullet killing him. Soon, Russia won’t have as many bullets.
We can probably take twenty, you know, two hundred thousand Ukrainians and Russia will have two hundred thousand less bullets and missiles. They’re not there to win, they’re there to deplete Russia and you can see that the Americans expected the whole war to be over by now. Russia would have used up all of its arms, run out of bullets, run out of missiles and the sanctions against Russia would collapse the currency and the Russian people would say “We can’t buy Italian handbags any more. We can’t buy what we are used to, let’s change the regime, let’s have another Yeltsin then at least we could buy everything Western that we could.” That was the fantasy. They must know what you’re saying, it cannot be a secret to the West …
ATS
It’s not!
MH
… wear Russia down. They’ve got Zelensky to essentially have the Ukrainians commit suicide and have the German economy commit suicide …
ATS
Yep
MH
… and have the European economy essentially destroy its ability to be economically independent of the United States.
ATS
But in your opinion, am I correct in my feeling that the US sees, and I mean that there is a consensus of the ruling elite, that a sovereign Russia or a sovereign China is an existential threat to the United States and the West.
MH
Yes, and they’re absolutely correct.
ATS
Would you explain that please. Please explain that in quite detail because it’s really important I think.
MH
The US economy cannot recover its industrial power. Its debt is too high, its cost of medical care, 18% of GDP is too high, it’s the rent is so high, 48% of income. There’s no way in which the United States can grow again. Every business recovery since 1945 has started from a higher and higher and higher level of debt, and now it’s reached the limit. A year ago the Federal Reserve said that half of Americans could not raise 400 dollars in a crisis. The recent increase in interest rates have raised credit card rates and debt service by about 450 dollars per average American. So here are people who couldn’t raise it.
All of a sudden they are shifting their consumption patterns to downsizeable. The dollar stores’ spam is now in short supply because people are moving from expensive meat on to that. So Americans are going downhill. So what is it that Russia and China and India represent? They’re countries that are industrializing and moving forward. The American economy and American society is run by the financial sector; they’ve shifted planning away from government to the financial sector which lives in the short run, and essentially the growth of the one percent is shrinking the ninety-nine percent.
Russia, China, the objective of their government is to increase the overall prosperity. When they create money it is not to increase stock market prices or bond prices, or bail out banks that have essentially gambled on which direction interest rates are going, or whether Bitcoin is going to go up or down. So the whole idea of the purpose of society, the purpose of economic development is different, and China, Russia even Iran, India, they’re showing that what they’ve done is simply following the path that America, the United States and Germany did in the nineteenth century.
It’s a mixed economy, they’re using government to provide basic needs like medical care, education freely, whereas America you have to go deeply into debt for both. Medical bankruptcy is the leading cause of bankruptcy here now. So of course, when the government provides most of the basic needs the employers, the industrial employers, do not have to pay wages enough, high enough, to cover 40% for rent, four thousand dollars a month rent in New York city, or the medical charges. So essentially it’s a conflict of economic systems, and in my book I say that the economic system is basically industrial capitalism evolving into socialism in the rest of the world, as opposed to finance capitalism in the United States.
Now a week or so ago on your blog you had this wonderful map of countries that had imposed sanctions on Russia, NATO and America and English speaking countries and the whole rest of the world. This is how the world is dividing, that map tells you everything you need to know.
The West has essentially committed financial suicide, it’s going down. The rest of the world is going up.
What can you do if you think you’re the unique nation; you’re the nation that everyone should look up to and that you can control other countries, but how can the United States control other countries diplomatically without an industrial sector? And with a government having a debt to foreign central banks and a foreign government far beyond its ability to pay? Much worse than any of the global south countries foreign debt.
How on Earth can you hold on even beyond this September, when you’re going to have countries that owe dollar debts on their bonds, Latin America, Africa, when they cannot afford to pay the dollars to the dollar bond holders if they have to pay higher prices for oil and gas and food and raw materials that the United States banks sanctions against Russia has done. Are they going to really lie back and let America force them into economic suicide because their own pro-American elites, their own Boris Yeltsins in Latin America, other countries, are going to say “We have to do what the Americans say”? Or are they going to say “It’s over!”?
ATS
For one second, take off your Michael Hudson hat and put on the hat you are that financier, the one who thinks exactly the way you described it. What do they practically think is gonna happen to Russia, Iran, India and China, do they really sincerely believe they’re gonna break them up into little parts, have them all run by comprador elites and make a killing, do they believe that?
MH
No. That’s just one scenario they have. They say “if we can’t do that then we’re gonna sell all of our stocks and bonds and we’re gonna try to buy into an investment position in these countries and we’ll gamble on their currencies going up and we’ll make money on the casino.” It’s easier to make money in an economy that’s crashing than it is in an economy that’s rising. If you’re one of the one percent you think “Well OK, the United States economy is going to shrink, boy, we will be able to pick up all sorts of companies at distressed prices. We can certainly buy German and French that are broke at distressed prices, then we can make our own new arrangements with Eurasia on some kind of beneficial terms and we’ll come out OK.”
ATS
Here’s a question that I get a lot, and not being a specialist, I reply to the best of my knowledge, but really I think coming from you it would be very interesting to hear your reaction. What do you make of that theory; you’ve described the financiers that are running the United States right now, What about this thesis that I submit to you: Ah, Putin, Xi, they’re all puppets of Davos, of the World Economic Forum, they’re working hand in glove, there is no opposition, it’s not true.
All these guys what they want is, you know, create a united World Order and all these tensions between Russia, the US, China, it’s all fake, it’s tactical but really fundamentally the people running these countries and the US are the same. So my question is double, first of all, factually what can you tell us about how much does Davos and the World Economic Forum or the Bilderbergers, or whatever, or the other version of that is they’re all working for Israel, that’s another one. What do you make of this that puts all of these leadership in the same bag, question first part, and second part is how are they different if they’re different. How would you compare and contrast the ruling elites and specifically the leaders, but also the class that supports them in say China, Russia, and the United States?
MH
Well, the word that the World Economic Association uses to describe itself is “globalism”, and globalism is their word for “colonialism”. It used to be called “imperialism”. Every imperial European country, Britain, Holland, France, they were all globalists, they were reaching out to take over other countries.
The objective of globalism for them was to create a colonial system where they would essentially extract all of the wealth of their colonies for themselves by appointing a local client Oligarchy to rule on their behalf. So they realised that when President Biden has used a different vocabulary and he said “Well it’s really not between globalism and anti-imperialism, it’s between Democracy and Autocracy.”
What he means by Democracy is what you described, an Oligarchy, and Aristotle described how all democracies tend to evolve into oligarchies because as their wealth goes up, some people get wealthier than others and they are in a position to take over the public media and the political system. Ever since Rome, actually ever since ancient Greece that’s been the case. So on the one hand, the West is really, the World Economic Foundation is sort of, let’s say the board of directors of the western economy, and they’re all like, just like the Greeks all used to get together on one of the sacred islands, either Delos or Delphi, that’s the role that Switzerland has today.
Well, now all of a sudden what you have is autocracy. Autocracy means a country with a strong enough government to prevent an Oligarchy from taking over.
ATS
I love that definition, this is a really good definition!
MH
Yes, and they’re strong enough to say “wait a minute, we’re not gonna let individuals wanna make money at the expense of our long term growth, because if we don’t have long term growth we’re not going to be able to maintain our defences against the globalist colonialist West. We wanna grow, we don’t want to let what President Clinton expected to happen, to let Goldman Sachs bankers go into China, extend credit to Chinese industrial companies, have them issue stocks, buy the majority of stocks and end up doing to China like America did under Yeltsin by privatising the raw materials.
Eurasian countries are saying “No, we’re not going to let the Westerners buy our commanding heights We’re not going to privatise our railroads, our school system, our land and our basic natural monopolies for individuals to make economic rent extraction from them. We’re going to make the public utilities to make our economies so low cost and productive so that our industries can outsell those of the West where they’re busy privatising everything.”
By privatisation the West is making everything into a high cost economy. The rest of the world resisting privatisation doesn’t have monopoly rent, doesn’t have to build even the cost of production into medical care, schooling, they basically provide these either freely or at a discount. That’s exactly how the United States got rich in the nineteenth century, by providing government support for industrialization.
Other countries are doing this so we’re dealing with … America has always said to other countries “Do as we say, not as we have done”, and when they actually do what we’ve done, it’s Autocracy. That’s really it in a nutshell.
ATS
Yes, but, doesn’t Putin go to Davos? Why is he going there, doesn’t it prove that he’s working with them?
MH
I don’t think that there’s any way, the West’s idea of working with China and Russia is to buy financial control of their economy by turning all of their assets, their school system, their railroad system, their water system into rent yielding assets, and other countries are not going to do that. So their idea of working together … the West’s idea of working together is not the rest of the world’s idea of working together. They realize that it’s a one-sided deal in which they lose.
ATS
What do you think is gonna happen to, you know, all the innumerable institutions that were run by the west. I’m not talking about just the Trilateral Commission or the Davos Forum, I’m talking about organisations that are essentially run by the US. That’s because their main financiers have control over all sorts of UN agencies, over so-called private corporations, etc. Do you think that Russia and China will literally, you know, let it all go, the World Bank, the International Monetary Fund, the World Trade Organization, or are we gonna see two co-existing completely different economies of societies on one planet?
MH
I can answer the question quite simply. America will not join any institution in which it does not have a veto power. The World Bank, it has a veto power in, the IMF, it has a veto power in, and in the United Nations it was the communist agents that suggested the US insist on veto power; the man with a pumpkin, I’m blocking out his name right now. So the United States would veto any policy that would benefit other countries more than itself, and it would never permit other countries to dictate what American policy would be.
That’s why the United States has not joined the International Court, because we can make our own laws, you can’t tell us what to do. It’s why the United States supported the IMF as long as the IMF can essentially act as an arm of the Defence Department, just as the World Bank does. So, obviously any group of nations, such as the Shangai Cooperation Organization, needs a banking organization to facilitate the transfer of funds, to arrange currency swaps to create its own line of credit. There will be a non-US World Bank, a non-US IMF. China, in its Belt and Road initiative, has created its own counterpart to the World Bank.
I would expect that these countries will create their own world court, and they can hold war crimes trials, and the United States may not recognise it but at least the war crimes trials can designate who the war criminals are and pass laws for the rest of the world to win the hearts and minds of South America, Africa and the rest of the world.
And there’ll even be something like the non-aligned countries that began to be formed in 1955 in Jakarta, when they didn’t have a critical mass or no other critical mass. Now all these countries in the chart that you had, with the countries that did not join the sanctions against Russia, can create their own group international organisation, and the West will not be in it unless they let the West in without any veto power, which the West, certainly the United States, will not join. And this new set of international institutions, which is what the United Nations pretended to be, or the IMF pretended to be, a truly global organisations for the benefit of everyone, all of these institutions pretended to be, but actually were arms of US diplomacy.
They can all be created for what the world wanted in the first place. Something like, Russia has already extended the BRICS Bank as a prototype for a new alternative to the IMF, there will naturally be these new institutions taking shape to coordinate trade, development, payments for countries that are unbalanced, the creation of credit so the countries are not forced into bankruptcy if they can’t afford to pay short term debts. Basic coordinating and mutual support organisations. So we’re back to the old philosophy of mutual aid instead of predatory relations.
ATS
But if that happens, considering we already discussed how hell bent the ruling elites of the United States, the financiers, are already, by China, Russia and the other countries in their current still developing stage, my God what are they gonna do if these countries actually … I agree with you, by the way, I think that’s where they’re headed … but my fear is it’s going to be absolute hysteria among Western financiers. I mean, for them isn’t there a moment where they have to choose between death by finance or death by nukes, but it’s the death either way?
MH
Well, as Keynes said, financiers always take the best deal they can get at any moment of time. So if things move not in their ideal way they’ll say “Well, what’s the best we can do?” Well, the one percent can always make more money by squeezing the ninety nine percent in the United States and Europe. It will be very unpleasant to be a European for the next decade.
ATS
Oh yes. I very much agree with that. My personal feeling is that the US has decided deliberately to burn down all of Europe, because it removes a competitor, it allows them to purchase whatever is valuable at cut, you know, very cheap prices. And to fully rekindle the original mission of NATO which is to keep the Americans in, the Germans down and the Russians out.
MH
Well the United States calls it a “healing process”. A healing process will be when the American companies get to buy out all the European companies, and essentially probably Germany will become another state just like Rhode Island, England can become another Delaware, it’ll be one happy centralised family.
ATS
But Michael, is that really possible, can they really pull it off while, you know, the quantitative easing is not an option any more, inflation is going up, the country is being de-industrialized? The political tensions internally here are through the roof!
There was a recent opinion poll, where I saw that the majority of Trump voters actually would not be opposed to seceding, that there State would secede from the States that the perceive as being run by, you know, by an etcetera.
Does this country have, I mean it seems to me that, where are they gonna get, you know, the means, the willpower and the time to make any plan or to do anything to try to … you see financiers want to make money, well if they’re busy having a hard time doing this, let’s say somebody who really is, you know, lacking oxygen like in an asthma crisis, if you are in the middle of an asthma crisis you don’t go in the ring to fight Mike Tyson.
MH
Well, you are making a mental leap that is not justified, you’re implying that if 75% of Americans are against something, that’s a political crisis. It’s not a crisis at all, it doesn’t matter. 75% of Americans all believe that women should have access to abortion, neither party supports this. 75% of Americans probably think there should be peace in Ukraine and America shouldn’t be at war. Who cares? That’s no crisis, what does it matter? The popular desires, what they want, are not a crisis if there’s no vehicle to express their unhappiness, and there’s no way in which American voters can express what they want either in the Democratic or the Republican parties, that are really the same party, and are in full agreement with what they’re doing. The voters don’t matter; remember we are talking about the American definition of Democracy, which is an Oligarchy.
ATS
Let me try another angle then, forget about the voters. But surely there are people in this country, there is a manufacturing sector, there’s science and technology, I mean surely there’s some interests that are opposed to the total rule by the financiers and where this is taking the country? I mean, I don’t wanna sound quaint but how about simply patriotic Americans who want their country back and don’t want it to burn down into the delusional, you know, narcissistic dreams of financiers who are completely ignorant on top of that.
MH
The question is, how can they institutionalize these ideas? Now obviously I would like to restructure America on the path that made it so productive and successful for so many administrations, but I don’t have a vehicle to institutionalize it. Even if suppose that Bernie Sanders or even I were President, what could I do with Congress not passing the laws I would like to see? There’s no influence that I can see that I can have that would actually bring about the improvements that you and I are talking about.
Every country, whether it’s Russia or China or America or Europe, any country should follow, how can we do that in America, we’re blocked. I’m surprised the degree to which it’s blocked in Europe, but it shows the extent to which the State Department and the National Endowment for Democracy, that is the CIA, can not meddle in foreign politics and just bribe and control other countries’ leaders in the way that Lavrov has described America bribing and strong-arming.
ATS
OK, so there’s no way of bringing together or empowering the discontent inside the countries. Europe is …
MH
Yes! Of course there’s discontent, homeless is going way up, of course they’re discontented, but they’re …
ATS
Yeah, yeah, but what I mean to say that there is no way that this could result in political change, you explained that.
MH
I can’t see any …
ATS
Me neither.
MH
… and people like Bernie Sanders tried to figure out what to do, he can’t figure out, Ralph Nader couldn’t figure it out. You know, you look at the reformers who had good ideas, I know many progressives within the Democratic party and they say that there’s nothing that they can do as long as the Democratic party exists. Ironically, the way that they could get democracy in the United States would be for the Democratic party to be completely dissolved, the progressives would all join the Republicans, you’ll have just one party, and at least if you had one party then you could have primary fights over what different ideas there were. Within a single party you could have branches. But with two parties blocking out any alternative, you can’t have, at least what Europe has, and that is a parliamentary system that new parties can emerge with new ideas. There’s no vehicle for a new party to exist with new ideas as long as there’s a two party system in the United States where the Democratic Party’s role is to prevent any left wing critique of the Republican Party.
ATS
Well what I can tell you about Europe is that, first of all, it’s completely under the USA’s thumbs, and the parties … in Europe they just had it simple, they went traditional; if you can’ t provide services or bread and games, repression. The fact that in Holland, of all places, cops used actual live rounds against demonstrators in the country of tolerance, tells you the degree of vicious persecution. In Switzerland, a country I was born in, there is now a law that just for being suspected of supporting terrorism, suspected, they can hold you indefinitely. Just because they thin, maybe a sympathy. Now if you look on top of that, American politicians want to declare Russia a terrorist State and everybody including from, you know, Ralph Nader to Ron Paul anybody who has another opinion is a Putin agent, what it smells to me like is that we’re headed for repression, repression and more repression.
MH
That’s what it looks like.
ATS
That’s it? They’re just gonna jail, censor, and they’re also gonna … I mean it’s literally the, you know, Orwell’s boot stepping on a face. That’ s the future of the West, there’s no other alternative?
MH
It’s the future of the United States, which is remember the unique nation. Other nations have an option, they can emigrate. Europeans can emigrate, you were seeing 20% of the Baltics have emigrated, Ukraine has emigrated. Americans can’t emigrate; they don’t speak a foreign language, they have nothing to offer, they don’t have any skills; maybe they can pick grapes in Mexico, but I’m not sure what else they can do. So that’s the difference, America really doesn’t have much of an option.
It would be nice if American engineers could emigrate to Russia and help organize better factories, but I don’t think they will and they’re really not political enough to be threatened. But the people who are threatened in the United States really don’t have anywhere to go, it’ll be like in the 1940’s, my father was a political prisoner, most people I knew growing up were political prisoners in the United States.
ATS
My impression’s been so far that the key difference between the US and Europe is that in the US there is a Bill of Rights. No such thing in European law, and that Bill of Rights doesn’t really protect us, yes they’re chipping away at it from every corner thinkable, particularly under the heading of national security. National security seems to be trumping the Bill of Rights completely. But still they have that problem, they have this pesky, pesky first, second, fourth, fifth amendment that they would like to bring down, and they really have a hard time doing it.
The other hand, when I look I agree with you; the parties have one agenda, the media is completely … it’s a mouthpiece for the two parties. Congress is run by the same people; there’s nothing left! Essentially are you saying that Russia needs to do absolutely nothing, just wait for the US to self implode?
MH
Of course it has to defend itself, while the United States gets more and more frustrated and angry and acts out its frustrations as it falls apart. I think Marx said the end of Capitalism would not be a pretty sight …
ATS
(laughs)
MH
… we’re seeing that in the United States. As this becomes an issue of national security, as you just said, national security trumps the Bill of Rights. My father was one of the Minneapolis seventeen, and he was accused of having books of Marx and Lenin on his shelf. You’re not allowed … and, the Attorney General who oversaw the case later said the one thing thing he was embarrassed in his life was essentially framing up the Minneapolis ??? and putting them in jail. And he did it to solidify Americas friendship with Stalin, ironically. So that trumps everything. And you saw the Japanese interned in world war two …
ATS
Yes!
MH
… where was the Bill of Rights then? Right now Asians are attacked regularly on the subways and the streets of New York City, where’s the protection against them? You could go right down the list, it’s all … the problem is enforcement, you can have wonderfully utopian laws written, as many of the religions have written them, but it’s all in the enforcement, how are you going to administer them and that’s where the problem is. The Oligarchy is very careful in selecting judges that will do what the Supreme Court is doing now and just making its own rules that have nothing to do with the Constitution, like banning abortion. That’s again, only fourteen procent, I think, of Americans are reported to approve of the Supreme Court, but there it is and what can you do about it?
ATS
But, just in this specific case, it is my understanding, correct me if I’m wrong, that the Supreme Court did not ban abortion. The Supreme Court said that there is no constitutional protection for it, therefore it should go down to the States, but it isn’t a ban.
MH
Ah, you’re right and this is a very important point. America is different from every country in having … the Constitution was written by the slave owners, who were terrified that a democracy would enable a majority of abolitionists to ban slavery, and so they wrote into the constitution the slave rights.
The Supreme Court just ruled in the case of global warming and environmental protection there can be no federal rule for environmental protection because the federal government has to leave everything to State rights, and abortion left to State rights. Well, if you have no federal ability to shape or plan an economy, if you have the States can simply go their own way. This was happening half a century ago when there were anti-usury laws in the United States, well …
ATS
Really?
MH
… Dakota said “Well, we don’t have any anti-usury laws”, so all the credit card companies moved their head offices to North Dakota and could charge whatever they wanted. As long as you have no federal power to shrink the economy you can not have forward planning, and that has made the United States a failed society. So it’s moved from a failed economy to a failed society; that’s really what we’re talking about for the big context.
ATS
Do you think over time it will actually physically break up into several successor States? There’s a lot of people will say “No, the South, California, the North, New England are so different and they want to go in completely different directions, let them go.”
MH
I don’t know how that can be done within the constitutional framework, there’s really … the South has to secede by military warfare, and certainly other countries, the States that would like to secede are not about to indulge in warfare. There will be something more like civil disobedience and there will just be more a move to dissolution and anarchy, but I don’t see any formal separation.
ATS
Can I run a scenario by you?
MH
Sure.
ATS
I’ve noticed in history, but also in the case of Russia during the 90’s was very typical, when the central power, and it was very much the case in the Ukraine, before the war started it was already very observable, when the central government cannot provide the local leaders with money, protection, or whatever, it can’t crack down on them either any more. The locals sort of create their local fiefdoms which remain part, say the typical Ukrainian oligarchs all have their geographical fiefdom. Formally it was still a united country, but in reality you could see that it was run locally. And I’m thinking of sitting here in Florida, the governor here has taken some very strong positions, and I don’t think he … people in Florida, first of all most people hate the Federal Government, that’s all over the country, so for starters. Secondly local governors can be very popular, and at that point, I mean I would say a DeSantis has no need for the Feds, none. He has everything he has here …
MH
Yep,
ATS
… he can start ignoring the Feds. So then the next step is do the Feds have the need to force him or some other popular governor to comply? And here I recall something that happened in Russia twice. In 1991, elite special forces were given the order to storm the Parliament and to take it over. And we’re not talking about cops, we’re talking about elite KGB special forces, and they said “We’re not doing this; we’re not shooting our own people!” Then in 1993, the exact same thing happened. This time the order was coming not … the first time, you know, Yeltsin was the target, the second time he was the order giver and he said “Storm!” and I was actually in the room with a Colonel from one of these KGB units who got the call said, you know, “Go there, investigate, see what it would take to clear it up” and they again refused to obey.
So where I’m headed here is I don’t know if the Feds have an army of thugs willing to crack down, I don’t see the locals in Florida be it the Sheriff department or the police or anybody, you know, using violence against the local people here. So without formally seceding, I see signs of Florida sort of going on her own way and basically I would not be surprised if they start ignoring the orders coming from DC ? Garbled ?.
MH
You’re absolutely right, that’s what I said, civil disobedience; they’ll just go their own way. You’re right, you don’t need to break up under a situation like that.
ATS
You agree that the civil disobedience could be coming from local authorities?
MH
Yes.
ATS
OK
MH
Yes
ATS
Because it’s one thing, to you know, to scream slogans in the streets and burn a couple of stores, it’s quite another one to say we’re not gonna obey the Federal government and that comes from my office, the Governor – boom!
MH
Well this is what happened in the 1880’s when there was a contested election between the Republicans, the Democrats and the deal was the Democrats said “OK, we’ll let Hayes become president, but you won’t enforce any of the protection of the slavery laws any more; you won’t support reconstruction any more.” Basically that was the modus operandi that lead to the Ku Klux Klan expanding, and all of that. That’s the kind of split we’ll see. So there will be some population movement from one set of States to another set of States.
ATS
Uh huh, we already see it here.
MH
Yes.
ATS
Believe me, here it’s flooded with Northerners and Californians now!
MH
Yep, I bet. In the 1970’s I stopped calling myself an economist and called myself a futurist because I was working for the Hudson Institute, I worked with Alvin Toffler for the Futures Group, and it was easy to forecast the future when everything was basically occurring in a given setting of institution. Right now I’m not even gonna take a chance on seeing the future, because the future can be whatever the Eurasian countries want to happen, and we’re not sure what’s going to happen there.
All I can say is that there is a very positive idea when beginning about ten years ago, when I was teaching in China, many professors wanted me to, you know, come and lecture to their class and everywhere I talked, the students had such forward looking ideas, such enthusiasm. They really felt that they could change the economy and they saw that Shanghai and the free enterprise boys had begun to make the country free for billionaires, and they wanted to clear up what they viewed as corruption, and it really was corruption, and create a new economy, and they were all undergraduates and most of them worked in the Communist Party as officials, promoting ideals and hoping. And that seems to be, these people are now in their thirties, forties, and I don’t think they’ve been corrupted, I think they’re still trying to transform the economy, but everything is open.
People say that well, China’s a Marxist economy, a socialist economy, but Marxism is the Chinese word for politics, I mean it could be anything really that you want. So the future is completely open for what they’re going to do and I think that they seem to be handling, they seem to be a reality-based politics. It’s surprising that in the field of foreign policy there is a split between the realists and the idealists, meaning the Neocons. There’s nothing like that in economics. The mainstream of economics is neoliberalism, privatisation, Thatcherism, to make the world like Thatcher, there’s no reality economics in the West.
In China, officials said “We really have a problem. We sent our students to the United States to be educated and they take economics courses and how’s that gonna help us here; what they’re told is privatise everything and make us look like Margaret Thatcher’s England!” They have to develop an entire new curriculum there, to sort of self guide themselves, and without an idea of where you’re going, you’re not going to go there. So the question is “what ideas are going to become dominant?” Well, that’s why I spend so much time in China, or at least working with the Chinese these days.
I haven’t seen a similar spirit in Russia. There’s a … I haven’t been in Russia for a while, but when I was there the feeling was still such disillusionment, they didn’t have an idea of where they’re going, and Russia is one of the few countries in the world that has no background in Marxism at all, so they don’t really have much of an analysis of finance capitalism and rentiers and all the things that Marx talked about in volumes two and three of Kapital. So I think that China will really take the lead and I think that this will spread to other Asian countries and to Russia too, and you’ll have countries sort of reinventing the wheel, and it’ll be reinventing the wheel of industrial capitalism, State socialism evolving into socialism, and that’ll probably be a good thing but I’m sure there will be a lot of twists and turns interrupted by personal opportunism along the way.
ATS
Well, as I see it, we’ll make it very short because there’s two minutes left here, Michael, I really do believe that it’s quite striking to see Communist China, neo-liberal Russia, the Islamic Republic of Iran, you know, completely different countries, coming together and I think the two key moments, I think, what unites them is A: they all want sovereignty, second they want their own way to development, they deny any kind of universal ideology that should be imposed on all others, and third, relationships between countries have to be built on International law, only.
That’s what I see the key pillars of the World order that I think is gonna replace, you know, a thousand years of Imperialism, because I really think that this, this last Empire is the last Empire because it’s a model that’s outlived itself, and is despised in most of the countries out there. Very few countries, still you know have some kind of idea about becoming an Empire, mostly because a lot of them tried it and paid dearly. Imperialism is horrible for the country, at first it’s initially beneficial, but then it turns against you and the blowback is terrible. So that’s basically what I hope to see in the future, God willing we won’t have a nuclear war that’s all I can say.
MH
Well this is wonderful; the strength is their diversity.
ATS
Yes!
MH
Being diverse, no country can dominate the others, this is exactly what gives it stability.
ATS
Thank you, Michael, we’re coming to the last seconds here, I have to stop. Thank thank you, thank you, thank you; it was wonderful, maybe we can do it again, I enjoyed every second of that, so thank you for everything!
MH
Thank you, it’s ????
ATS
And have a wonderful, wonderful day!
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