…How It’s Going

Capitalists, as Adam Smith noted but didn’t think through, hate free markets. To restrain them and get more of what they want, the business class of the late 1800s convinced legislatures to deregulate corporations, which until then had been retrained from buying one another and undertaking activities not enumerated in their charters.

In the late 1970s and early 1980s, capitalists finally recovered enough clout to fight back against what they’d lost in the publicly-administered full-employment economy of World War II. The coming-out party for this restorationist project was called, in the USA, the Reagan Revolution.

How’s that effort going?

Take a look at this graphic from of Bloomberg Businessweek:

Bloomberg Businessweek, 3 Oct 2021

The Coming Onslaught

Julio Vincent Gambuto is the source of today’s re-post. This is righteous stuff, and as solid as a prediction of the human future can be:

And so the onslaught is coming. Get ready, my friends. What is about to be unleashed on American society will be the greatest campaign ever created to get you to feel normal again.

Pretty soon, as the country begins to figure out how we “open back up” and move forward, very powerful forces will try to convince us all to get back to normal. That never happened. What are you talking about? Billions of dollars will be spent in advertising, messaging, and television and media content to make you feel comfortable again. It will come in the traditional forms — a billboard here, a hundred commercials there — and in new-media forms — a 2020–2021 generation of memes to remind you that what you want again is normalcy.

Here at TCT, we think there are 3 interesting questions about this impending typhoon of normalcy marketing:

  1. Will the overclass commence selling normalcy (they’re already promising it, of course) too soon, sending the underlying population “back to work” (note that work here includes the actions of attending and reacting to normalcy marketing campaigns) before there is a viable basis for keeping the COVID19 pathogen from again threatening a mass culling of our huge medically vulnerable and genetically unlucky populations? Or will they somehow repress their base urge enough to wait for genuine safety? A premature “back to normal” effort might truly unmask TBTP and BAU. It remains to be seen if TPTB can recognize this.
  2. Will corporate capitalism — the overall environment for conducting big business — manage to re-inflate itself back to economic normalcy? Many pundits are opining that this is now impossible. Here at TCT, we lean toward thinking a post-COVID boom is actually pretty likely, if not necessarily extremely near. Corporate capitalism is very resilient, and, as thinkers like Joseph Schumpeter, Baran and Sweezy, and Naomi Klein have argued, it thrives on certain kinds of waste and destruction.
  3. Will there be any coherent push-back to whatever re-inflation efforts emerge? The delusionary nature of libertarian and supply-side dogma is about as obvious as it’ll ever be. Marxian and Keynesian rescues are pretty much the only game in town, as some have said all along, and as the headlines now show. But will this almost-admission of reality somehow trigger a viable campaign to finally end the bipartisan Thatcher-Reagan Consensus, which has always revolved around the core claim that society only improves when the already-rich get their hands on even more of society’s disposable wealth? It is possible to have hope. Here at TCT, we tend to worry that our corporate-pwned media ecology and our atomizing, automobile-centered infrastucture for everyday life render such a thing very unlikely.

The Actual Use of Corporate Capital

Any guesses what this graphic depicts?:

That is the percentage of free cash flow the firms included in the S&P 500 Index spent across the 2010s buying back their own shares, according to Bloomberg Business Week.

This is not an error or an optical illusion.

To say it again: From 2010 through 2019, U.S.-based big businesses, as a group, spent more than half their net profits buying back claims to their own future profits — i.e. helping their future shareholders extract even more wealth from forthcoming corporate endeavors. More than half.

Compare this fact to your Adam Smith model, pro-capitalist friends.