Thursday, August 18, 2016

The two insurgencies

The Twin Insurgency by Nils Gilman is an excellent article that succeeds to explain both the plutocratic insurgency (gated communities, off-shore accounts) at the top, and the “criminal” insurgency (drug cartels, arms smuggling) at the bottom as part of the same process of rejection of a modern social state.

I find the discussion compelling even if no single aspect of the article is new (that is, was not argued before). But it is putting them together in a coherent whole which represents the strength of Gilman’s piece. A person who flies in a private jet and opens an offshore account in the Bahamas to avoid taxes and a people- smuggler in Mali both react to the withdrawals of the state and both, by their actions, ensure that that withdrawal will persist.

There are two things on which I would like to expand on Gilman. First, the role of ideology, and second, the interaction of the plutocratic, criminal and political worlds.

Why the “criminal” or deviant globalization occurred is, I think, best understood (as Gilman writes) as a product of the weakening of state capacity. But this is not all. I would also include the ideology of enrichment by any means. Deng Xiaoping put it best  when he said that “to be rich is glorious”; he might not have added by “any means” but this is how the message was understood. At its extreme, the message was understood as such in transition countries, especially in Russia and Ukraine, that engaged in massive stealing of state assets by those who were close to the governing circles. This has continued for almost thirty years: it is only that the kleptocratic groups change depending on who is in power, but the differences between the way that Khodorkovsky and Rotenberg, Pinchuk and Poroshenko have become billionaires are non-existent. In those countries, we see mafias becoming the state and we see the seamlessness between the three worlds, plutocratic, political and criminal, at its clearest.

But what made this possible was an ideology that argued that “society does not exist” and that the only sign of success is material success. Being rich mattered socially more than before simply because other forms of competition (meaningfulness of a job, contribution to society etc.) were declared irrelevant. Success became easy to measure because every success, whether in Olympian swimming, software code or journalism, was translated into a single metric: money. Just observe how every athlete, professor, economist, journalist who, for whatever reason, becomes at one point known, immediately converts that notoriety into cash: appears in ads, charges speaking fees. (Even Gorbachev ended up in a Louis Vuitton commercial. Federer has sold everything from watches to underwear.)

This concentration on money as a common dominator of success makes comparisons between people much easier because we do not need to be bothered by figuring out success of two individuals in several dimensions. If all dimensions are folded into one, it is simple to tell success from failure. This also occults the way money is made, or makes it irrelevant since the important thing, in a unidimensional world, is to have it.

Combined with increased commercialization of activities that have hitherto remained outside the market (see my Commodification post) and with globalization that allowed everybody to see and almost experience what was the desired consumption pattern of the rich, it led to moral equivalence between the ways wealth is made. I do not argue that it was an entirely new development because historically wealth was acquired in even much more brutal ways than today (e.g. slavery) and once acquired was quickly “washed” of its original stain. What I think was new was the broad societal acceptance that the way wealth is made does not matter.

That societal acceptance is in turn based on cynicism about the overlap between the three circles I mentioned before: business, crime and politics. Businessmen were often criminals (and vice versa) and both interacted with or even became politicians. One could go on listing such phenomena endlessly, from those in Russia and Ukraine to Berlusconi in Italy, Thaksin in Thailand, the entire political establishment in the Philippines etc. But a recent piece, published in the latest New Yorker, unwittingly brought this aspect to light and allowed one to see how it functions in rich countries where state institutions have  ostensibly not been destroyed.

In an article about Trump’s family (mostly, about his daughter and son-in-law) we learn about the contacts between the son-in-law’s father and the Clintons. The father was one of the largest donors to Hillary Clinton’s senatorial campaign, and to express gratitude for the money she got, Hillary Clinton came to a private dinner the father gave. The father later ended up in jail for fraud and extortion. Moreover, we learn also that Bill Clinton was speaking, for significant “compensation”, at some of the events organized by the same funder.

The striking thing here is not what the author of the article somewhat naively wants us to focus on, namely the links between the wealthy New York-based families of the Trumps and the Clintons, but the ease with which business, criminal and political worlds merge into one. And we can be sure that this one example could be multiplied by ten or more. It was a shameless use of either past political office to rake in enormous money (the Tony Blair and Bill Clinton approach to politics) or the use of future political office to sell favors in exchange for funding (which is done practically by all politicians) that has conveyed the message from the top that any activity should be leveraged into money and that all means to get money are fine.

It is therefore I think massive corruption at the top and ideological change that have empowered the so-called deviant globalization. If president of a country can sell favors, why cannot a drug lord sell his goods? If the rich can open thousands of accounts containing billions of dollars in tax havens, why should a small hotelier in Greece pay taxes? If the law applies selectively, then you need to carve out your dominion where you will be the boss. This is how the extra-state areas of which Nils Gilman writes have come into being.

The essential point to take is that the two insurgencies go together: without plutocratic-criminal insurgency at the top, there would be no deviant criminal insurgency at the bottom. The only point on which I might differ from Gilman is that he applies the adjective “criminal” to the bottom insurgency only.

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