Volume 8, Issue 5
The views expressed in this article are the author’s own. They do not represent those of De Minimis; its editors, or the Melbourne Law School at large.
Some of you may have heard this idea quoted before, in that: While Hilary Clinton, Jeb Bush, Ted Cruz and other presidential candidates are fighting the campaign to be the next President of the United States, Bernie Sanders and Donald Trump are openly fighting the real war. A silent war of capital flows and wealth distribution. The war between The People and Corporate America; vis-à-vis the 1%.
The state of the union has never been worse. It may be ad nauseam among Generation Y and the Millennials that the US has been going downhill for years, but never forget that the United States is held up as THE democratic exemplar; however much that statement is untrue. Actually scratch that, the statement IS untrue. When did the passing bell of democracy in the United States actually ring? It’s hard to say. But what can be said is that the socio-economic system that now exists is not a democracy, but rather an oligarchic plutocracy. That is to say, America is ruled by an elite class whose power rests on capital.
When Wall Street collapsed in 2007, there was a strange conflation between the US Federal Government and the finance sector. Something up to, and perhaps exceeding $29 trillion
[i][ii] dollars were allocated as relief funds by the Federal Government and the Federal Reserve (over several years, of course – and with the government now earning dividends from shareholdings in various major US companies such as Freddie Mac and Fannie Mae).[iii]
Compare this to the fact that, before Obamacare, around 40,000 Americans died annually because they didn’t have health insurance[iv]. But before you get your hopes up; remember that the Republicans are still steadily working away at destroying Obamacare through whatever means they can[v] – or that the Obamacare legislation was basically written by[vi] the health insurance industry to keep themselves profitable.
It didn’t create public insurance, instead it made private health insurance mandatory, however subsidised[vii]. There is perhaps something to the argument made by Republicans that this system is ‘unfree’. Even Americans with health insurance need fear their ailments won’t be ameliorated; between 5 and 22% of claims are rejected in order to keep costs down and ensure healthcare companies remain profitable[viii].
Wealth distribution in America now has the top 10% with around 80% of all wealth in the United States[ix]. The top 1% holds around 48% all to itself[x]. Arrayed around this wealth are a small number of large corporate sectors: Silicon Valley, Oil and Gas, Pharmaceuticals, Fast Food, Arms, Tobacco, High-Finance (including real-estate and insurance), Risk management (a byword for private intelligence and security firms; i.e. Booz Allen Hamilton, highlighted during from the Snowden Affair of 2013), Telecoms, Public Relations/Advertising, and the Federal Government (including the military).
Consider this state of affairs in light of the fact that every 4th child born in the United States will be born into poverty[xi] – and that 45 million Americans are dependent on food stamps issued by the Federal Government[xii]. This poverty is one of the reasons the United States has such a large prison population, at ~2.2 million people[xiii]. The need to eat, lack of opportunities and desperation all drive people to crime. Indeed, one in three Americans has a criminal record of some type[xiv].
You’d think statistics like this might breed a comprehensive response to such stark inequality, or to the social or economic factors that breed it. Instead, one of the ugliest incarnations of capitalism rears its ugly head: private prisons. 2.4 million people are a big market, even if the people are the commodity. Keeping with the neoliberal ideology that has a stranglehold on US government, corporations realised that there was a profit to be turned from managing prisons, and charging States per-bed occupied.
This encourages corporations to promote greater social inequality, more opportunities for crime, and for a high turnover of people within the prison system to ensure profits by meeting inmate quotas[xv], even if their crimes do not benefit the punishment. To this end, such companies as the Corrections Corporation of America, Management and Training Corporation and Mid-Atlantic Youth Services Corporation have all been involved in the lobbying of State governments to make sentences harsher[xvi], encouraged the greater imprisonment of children through bribing local judges[xvii], and signing contracts with states to receive fines if imprisonment quotas aren’t met[xviii].
Minor offences such as possession of ‘personal-use’ quantities or marijuana, or related paraphernalia carry sentences of 6 months imprisonment in some States[xix]. Obama has recently brought the spotlight on this issue, but there is much more to be done[xx]. Is such a situation not the logical conclusion of the free-market? Illegality itself is made profitable, but who is committing the greater wrong?
Finally we turn to the electoral system. We could navigate the intricacies of the Federal electoral system for days and the labyrinth of laws from Florida to The Supreme Court of the United States (SCOTUS), but the truth of the 2000 Federal election was that Gore received 543,895 more popular votes[xxi]. The Electoral College system is fundamentally flawed. It is not fair to say that Bush was guaranteed to win the election because his brother was governor of Florida, or that it was because of the Supreme Court justices appointed by his father, but I encourage you to research the issue. Too much of it was forgotten in the wake of 9/11. Federal gerrymandering in the United States is now so bad the Democrats are currently under-represented by 18 seats[xxii].
This anti-democracy is quite deliberate, as in their own policy documents, Republicans admit to deliberately redistributing votes as part of REDMAP to ensure a greater Republican representation despite the popular vote[xxiii]. The Democrats do not have clean hands on this issue either: the balance of over- to under-represented seats is 22 to 40 in the Republicans favour, hence an overall outcome of 18.
The SCOTUS Citizens United decision of 2010, in layman’s terms, equated capping political contributions akin to restricting free-speech. This quite literally means that corporations can give unlimited sums to candidates that best serve their interests in any denomination; and through a complex web of financial entities, these contributions can be entirely secret[xxiv]. A recent Princeton University study found that the federal vote of the bottom 90% of Americans for income distribution had absolutely no effect in determining federal policy. But, on the other hand, the top 10% had a perfectly equitable distribution[xxv]. It seems (with all respect to George Orwell) that some animals really are more equal than others.
All these facts aside, we cannot look backward to the past and say the future is hopeless. That is what enemies of genuine positive utilitarian change would like us to do, and they have been only too successful in this age of disaffection and disinterest.
Mitchell Holman is a first year JD student.
This article will be continued in the next issue.
[v] http://edition.cnn.com/2015/02/03/politics/obamacare-repeal-vote-house/index.html; https://www.washingtonpost.com/national/health-science/states-find-new-ways-to-resist-health-law/2013/08/28/c63f8498-0a93-11e3-8974-f97ab3b3c677_story.html; http://www.nationaljournal.com/columns/washington-inside-out/the-unprecedented-and-contemptible-attempts-to-sabotage-obamacare-20130724
[vi] http://www.huffingtonpost.com.au/2009/08/13/internal-memo-confirms-bi_n_258285.html?ir=Australia; http://www.theguardian.com/commentisfree/2012/dec/05/obamacare-fowler-lobbyist-industry1; http://sunlightfoundation.com/tools/2009/healthcare_lobbyist_complex/
[viii] http://www.aarp.org/health/medicare-insurance/info-09-2009/health_claim_game.1.html; http://www.huffingtonpost.com.au/2009/09/18/in-health-care-number-of_n_291881.html?ir=Australia
[xi] http://www.huffingtonpost.com.au/2014/10/28/child-poverty-us_n_6054958.html?ir=Australia; http://www.demos.org/blog/6/10/14/elevated-child-poverty-capitalist-problem
[xvi] http://www.npr.org/2010/10/28/130833741/prison-economics-help-drive-ariz-immigration-law; http://www.npr.org/2010/10/29/130891396/shaping-state-laws-with-little-scrutiny