The roll call of corporate fraud – from Enron to Tyco; from Adelphia to Dynegy – keeps lengthening, with the addition of WorldCom, accused of listing $3.9 billion as “investment” rather than as expenses for maintainence and repair, thus reporting high profits rather than substantial losses.
This has caused many progressive forces to probe the causes of this widespread spate of “cooking the books,” putting out deliberate lies and false claims which have caused heavy losses to workers’ jobs and their 401(k) plans, as well as to pension funds and other investments.
A recent article by Carl Pope, executive director of the Sierra Club, writing in that organization’s official magazine, Sierra, argued that the scandals reflected the fact that “democratic capitalism has institutional flaws but only personal memories.” He argues that those who didn’t live through the Great Depression have no memory of the reforms put in place to curb corporate greed in that period and don’t know how those reforms helped curb the worst abuses of the system.
“Personal memories of the California energy crisis, Enron, and the EPA should be more than enough to spur a new generation of essential regulatory safeguards,” says Pope.
That the crisis of capitalism is more basic than a “memory” problem is indicated when Pope goes on to quote William Greider’s article from the Nation: “The rot in America’s financial system is structural and systemic. It consists of lying, cheating and stealing on a grand scale.”
This “lying, cheating and stealing on a grand scale,” is not a recent phenomenon. It goes back to the very origins of this nation, which based a large part of its economy on slavery and the slave trade, continued with the forcing of the Native American people off their land, and saw the building of great fortunes and political power on the backs of the American working class and vast numbers of immigrant workers.
“Capitalism,” as Marx and Engels wrote in the Manifesto, “comes into the world dripping with blood,” and that is certainly true of the American brand of capitalism, which has carried out bloody suppression of workers’ struggles for their rights, such as the Ludlow Massacre in Colorado, Haymarket and the Republic Steel Massacre in Chicago, and the murders of West Coast longshore workers on Bloody Thursday in 1934.
At the same time, U.S. capitalism carried out wars of domination and control of the Phillipines, Puerto Rico, Cuba, Mexico and other nations.
As two-time Congressional Medal of Honor winner Marine Major-Gen. Smedley Butler said in 1935, “I spent 33 years and four months in military service … I served in all commissioned ranks from a second lieutenant to Major-General. And during that period I spent most of my time being a high-class muscle man … for Wall St. and for the bankers. In short, I was a racketeer, a gangster for capitalism.”
This aggression and ruthless attacks on weaker and vulnerable peoples are an intrinsic part of the functioning of the capitalist system as it operates throughout the world, and no amount of reform or “personal memory” is going to change that basic nature of the system.
That doesn’t mean that reforms to curb or restrain the capitalist vultures, who know no limits to their greed and avarice, should not be pursued and fought for. Far from it, as underscored by history: the working class and peoples’ struggles for the eight-hour day, unemployment insurance, social security, the right to vote and to public education attest to the value and importance of such struggles.
But no amount of reforms can take the place of a new social/economic system in which the people who create the wealth of the nation – the workers, farmers, professionals, small business people, artists and others – will democratically decide the distribution of the wealth of the nation. That system is called socialism, and despite setbacks and obstacles that stand in the way, the American people, in their wisdom, will, in time, come to see and understand the superiority of such a system to the one we presently live under.
Herb Kaye is a contributer in Oakland, Calif. He can be reached at email@example.com