US – A graphic picture of decline

New book charts economic, social and political decay of America

The author uses the same method deployed by John Dos Passos in his great book ‘USA’ to intersperse the stories of individuals –  from the rotten summits of capitalism to those that are kept in the dirt by this system – with topical newspaper and media headlines to chart the economic, social and political collapse of the US today. The difference is the timeframe in which these books were written. Dos Passos’ book was written against the background of the Russian revolution and its mighty impact even on the USA – summed up, particularly in the chapter titled 1919. George Packer’s book, both on an individual and a general level, describes the effects of a social, economic and to some extent, cultural counter-revolution through neoliberalism with its outright assault on the living standards of the US working class.

Packer laments what he calls “the Roosevelt republic that had reigned for almost half a century [as it] came undone”. He claims: “The void was filled by the default force in American life, organised money”. But the money kings – the capitalist class – have always been in control, even under Roosevelt. One of the differences was that Roosevelt, on occasions, stood up to his own class, sometimes provoking their furious hatred by carrying out measures, which they opposed but were nevertheless in their long-term interests.

In the last 50 years most presidents, at least since the assassination of Kennedy, as well as Congress – which now reflects a completely dysfunctional political system – have been direct pawns of big capital. The losers have been the great majority of the working class, still referred to as the ‘middle class’. This is quite consciously done by the US bourgeoisie and even by Packer in order to blunt the inevitable emergence of working-class consciousness in the US. In vain, as the recent revolt of low-paid workers in the US has shown.

Illusory freedom

‘American Freedom’, the constant theme of big business, their parties and the media, is revealed by the author as a thoroughly outmoded idea – although it still holds sway over millions of even poor Americans: “Winning and losing are all-American games, and in the unwinding the winners win bigger than ever, floating away like bloated dirigibles [airships], and losers have a long way to fall before they hit bottom, and sometimes they never do. This much freedom leaves you on your own. More Americans than ever before live alone, but even a family can exist in isolation, just managing to survive in the shadow of a huge military base without a soul to lend a hand”. Marx in the Communist Manifesto made the same point about what is in effect alienation under capitalism: “Everything that is solid melts into air”.

Packer is referring to points he makes in more detail later in the book when he illustrates the searing contradiction between the colossal military power of the US and the money that is lavished on it against the likes of the poor: “At the bottom of Tampa, where the peninsular, died into the bay, [is] the front gate of MacDill Air Force Base, the home of the United States Central Command. World-famous four-star generals – Tommy Franks… David Petraeus – who drew up war plans for Afghanistan and Iraq there, commanded hundreds of thousands of troops in battle, took off in their personal jets to fly to their Area of Responsibility, committed huge strategic errors, and belatedly tried to correct them… From Egypt to Pakistan [they] have all the authority of Roman proconsuls. After the White House and the Pentagon, no parcel of America exercised more power during the War on Terror than MacDill. And four blocks away lived the Hartzells”.

The Hartzells are typical of millions of poor people whose lives are almost permanently blighted – driven out of their homes by ‘foreclosures’, staggering from one low-paid job to another, unable to get work, even in retail, because they lacked “the right look, and manner”. When one of the Hartzells did get a job, the bosses “showed him a video on the evils of unions and told him that if anyone approached him about joining one, he should report this to the management”.

However, after watching on the History Channel an account of “the battle of Blair Mountain, a coal strike back in the 1920s”, he began to ponder what had changed since then, which showed great solidarity from the miners from the rest of West Virginia: “People were [now] too scared to join a union… In the world today it was dog eat dog, every man for himself”.

This is just one indication of the way that American workers, under the hammer blows of events, are beginning to think about the growing inequalities that surround them. The recent strikes of low-paid workers, alongside the virtual union uprising in Wisconsin in 2011, show what is coming in the US. It is no accident that the American sympathisers of the CWI – Socialist Alternative – have recently scored such stunning progress in elections in Seattle. The brutal policies of a system in decline are educating American workers in the realities of capitalism today.

Life at the top

Packer contrasts what is happening at the bottom with the life and times of those at the top of the capitalist pile. A nauseating picture of greed, naked ambition and big elbows used to push others out of the way is marvellously sketched out by the author. An unforgettable cameo of right-wing Republican Newt Gingrich emerges underlining his sheer hypocrisy, on both personal and political levels. The life of a congressional lobbyist and his desperate attempts to climb the greasy pole of a Washington insider, is also dissected: “42% of the congresspersons and half the senators who left office went on to lobby their former colleagues”.

Colin Powell, the ‘institution man’, who as Secretary of State famously covered up the lies of the George W Bush regime for its ‘shock and awe’ war on Iraq, is treated similarly. Packer writes: “When the war began, the president said he was sleeping like a baby. ‘I’m sleeping like a baby too’, [Powell] said. ‘Every two hours, I wake up screaming’.”

Robert Rubin, Treasury Secretary in the Clinton administration, is ‘Institution Man 2’. “After half a life at Goldman Sachs he was worth well over $100 million and lived in a Park Avenue penthouse”. As an economic ‘insider’ of the Clinton administration, he steadfastly refused all attempts at regulation of the out-of-control financial system. He danced to the tune of Wall Street and therefore, claims Packer, is directly one of those responsible, along with the banks, for the crash of 2007-08. Yet Time magazine, before the financial meltdown, had included Rubin in what they called “the Committee to Save the World”. It didn’t, as the crash indicates. When this calamity happened, Rubin was safely removed from the centres of financial power and never once, as the book reveals, did he take any responsibility for what happened or the catastrophic effects this had on the lives of ordinary people. All of this does not prevent him from still appearing on British TV, proffering his views on the best way forward for society.

Joe Biden, Obama’s vice president, emerges as a particularly odious, contemptible, arrogant figure whose sole motivation is the enhancement of his own position. There is also a priceless description of the founder of Wal-Mart, Sam Walton. The biggest company in the US has advanced and grown on the backs of its non-union workforce, producing an endless supply of “crappy, if not dangerous, Chinese-made goods”. Wal-Mart is a metaphor for US capitalism today: “Over the years, America had become more like Wal-Mart. It had gotten cheap. Prices were lower, and wages were lower. There were fewer union factory jobs, and more part-time jobs as store greeters”.

Moreover, Wal-Mart’s success was due in no small part to the virtual dictatorship which existed in their stores: “The associates were given moral instruction and need permission from the district manager to date one another”. Walton’s family “were worth $23 billion, and eventually six of the surviving Waltons would have as much money as the bottom 30% of Americans”. In the best traditions of the US robber barons, “when clerks and truck drivers tried to join unions… Wal-Mart ruthlessly crushed them, firing anyone foolish enough to speak out”.

Foreclosure mills

On the other hand, Tammy Thomas, a black worker, emerges as a towering figure who struggles against all the odds: a mother bringing up a family, working in a factory and an activist in her union. Summing up the contempt felt by every manual worker who has been forced to earn a living by the sweat of their brow and then often condemned as ‘workshy’, she virtually spits out her thoughts on the right-wing Republican and past presidential candidate Mitt Romney: “Anybody who thinks factory jobs were good jobs needs to go visit somebody on a line… Most people wouldn’t survive in the factory. Mitt Romney would die in a week”.

But eventually she is forced out of her job with the downsizing and closure of the steel mill, which was wiped out like so many other factories in America in the great deindustrialisation that has left whole swathes of the country derelict, and from which it has not recovered today and is unlikely to do so in the future. This has had incalculable consequences at all levels of the lives of ordinary Americans.
This is described in great detail in a devastating account of the foreclosure crisis on just one part of America, Tampa. This has brought the “angel of death” to “thousands and thousands” in Tampa alone; those who face the tragedy of losing their homes through the dreaded ‘foreclosures’. Firstly seduced into ‘buying’ their house through easy loans, guaranteed through ‘securitisation’, which meant that these loans were parcelled up in dozens and even hundreds of parts, making it virtually impossible to decide who ultimately loaned them in the first place.
Yet it is financial institutions, like HSBC Bank USA, BAC Home Loans Servicing, etc, that are now demanding their pound of flesh, often from the poorest of the poor. The mechanism for achieving this is the “foreclosure mills”, which are almost like a car production line, assigning cases by “an automated computer system”. In other words, a virtual robot can deem that you should be thrown out of your house. Sometimes, nobody was there in the courtroom, “not even physically there, just a voice with a law degree on the court’s speakerphone, knocking off 14 cases in a half-hour call, and each case ended with the judge asking, ‘Anything unusual about this file? Anything missing?’ and then setting a date for the foreclosure auction, two floors down in room 202. At times, the court was empty except for the judge, a court assistant or two, and the bailiff wheeling the cartloads of cases back and forth. And, to save time, and perhaps to keep this judicial stockyard out of public view, many hearings weren’t even held in a courtroom, but confined to the security of the judge’s private chambers”.

In other words, in the land of freedom, in reality a capitalist hell, you can be made homeless by a faceless machine and with little redress. In frustration, one worker threatened with homelessness declared: “The only thing that is even remotely possible is massive worldwide debt repudiation”. However, a resistance to being made homeless by this inhuman machine is gathering apace in the US.

No technological fix

One of the most interesting sections of the book is the one that deals with the economy and role of Silicon Valley. The Masters of the Universe who have inhabited this region of the US in the last few decades have been associated with the perspective of a ‘technological revolution’ which promised to save capitalism. This promise has been shattered by the greatest crisis in the history of capitalism. But it has led to the rise of new millionaires and billionaires through hi-tech industries.

Packer shows the rise of this industry through individuals like Peter Thiel, a successful computer ‘entrepreneur’ – founder of PayPal – and a firm believer in neoliberalism, anti-communism and the promised technological transformation that goes with this philosophy. However, their arrogance and boundless optimism for the future has now been replaced in the outlook of those like Thiel with big doubts. He certainly no longer believes that technology alone can shore up capitalism.

They have become increasingly aware of the economic malaise and the growing social and political problems that beset US capitalism. This is summed up by the astonishing fact, related by George Packer, that “in 1980 only 50% of the US population thought that their children will be worse off than they were, while in 2011 it was closer to 80%”. They no longer believe that the “information age” – from which they personally massively benefited – represented the big “technological breakthrough” that had been witnessed in previous periods through the inventions of steam power and its spin-offs in railways and electric power, which led to cars, trains, etc. Thiel had come to think that the internet was a “‘net plus, but not a big one’… Twitter would give job security to 500 people for the next decade, but ‘how much value does it create for the entire economy?’ Facebook, which had made Thiel a billionaire, was ‘on balance positive’… [But] all the companies he invested in probably employed fewer than 15,000 people”. Thiel concludes: “You have dizzying change where there’s no progress”.

These themes have been explored by other writers and commentators, particularly in the economic field, in the recent period. This is a reflection of the deep-going foreboding of the strategists of capital for the future of their system. And if they read this book their concerns will be deepened.
It is true that new hopes have recently been generated amongst some capitalist commentators about the future of the US because of its seeming self-sufficiency now in cheap energy, partly arising from the massive shale oil and gas extractions. Cameron evidently also hopes this could make possible a new El Dorado in Britain as well. The fact that North Sea oil and gas did not lead to economic fireworks in Britain over the last 20 to 30 years does not dissuade him from the idea that a new lease of life can be given to their system.

But even if this was to come to pass – cheap energy fuelling a certain economic growth – the situation described in this book means this is a huge task against the background of a broken-backed US capitalism and the colossal social dismantling which has already taken place.
However, Marxists certainly do not discount that a certain limited growth is possible in the US and elsewhere. For the suffering masses presently bearing the brunt of the economic holocaust throughout the capitalist world this would indeed be welcomed. Even the partial ‘fake recovery’ in the US economy – which is far from solving the fundamental problems that beset the US – has led to a mini-strike wave with workers now feeling more confident to press their case for increases in wages and a bigger share of the cake. But this would not solve the fundamental problems which even Obama is incapable of overcoming. He seems to have reconciled himself to a ‘managed decline’ of US capitalism.

This important book therefore deserves the widest readership and circulation both in the US and in Britain to remind us of the terrible price which working people are forced to pay for the maintenance of this system, even in its heartland, the most successful of all the countries in the capitalist world. Hopefully the growing class conflicts will give rise to a clear class consciousness of the American working class, which in turn will lead to the creation of a mass party that will give voices to all the grievances detailed in this book, preparing the way for a socialist America.