Life under Capitalism

White House envoy has financial ties to Mubarak regime

Life under Capitalism, Real Life Revolutions
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Robert Fisk:

Frank Wisner, President Barack Obama’s envoy to Cairo who infuriated the White House this weekend by urging Hosni Mubarak to remain President of Egypt, works for a New York and Washington law firm which works for the dictator’s own Egyptian government.

Mr Wisner’s astonishing remarks – “President Mubarak’s continued leadership is critical: it’s his opportunity to write his own legacy” – shocked the democratic opposition in Egypt and called into question Mr Obama’s judgement, as well as that of Secretary of State Hillary Clinton.

The US State Department and Mr Wisner himself have now both claimed that his remarks were made in a “personal capacity”. But there is nothing “personal” about Mr Wisner’s connections with the litigation firm Patton Boggs, which openly boasts that it advises “the Egyptian military, the Egyptian Economic Development Agency, and has handled arbitrations and litigation on the [Mubarak] government’s behalf in Europe and the US”. Oddly, not a single journalist raised this extraordinary connection with US government officials – nor the blatant conflict of interest it appears to represent.

That really makes you have faith in the White House’s interest in reaching the right solution…

The Fall of the House of Murdoch

Life under Capitalism, Media
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Alex looks at the trouble in the Murdoch empire:

There’s a genuinely weird feeling to this. Obviously there’s some sort of political re-alignment going on, but it’s impossible to say what it is or how far it will go. It all seems to be dependent on things like the story about the journalist who started taping all his phone calls because his drinking problem meant he couldn’t remember what they told him and he feared they would use this to exploit him. Charming people. Someone apparently has copies. But who?

Newly established authoritarian regimes are always the most vulnerable during their succession process, as various Roman generals turned emperors found out on their deathbed. The Murdoch empire has had scandals and legal troubles before, but Murdoch has always been too useful for some and too powerful for others to have been bothered too much. that was Rubert though; but who is afraid of James?

The roots of Egypt’s class conflict

Life under Capitalism, Real Life Revolutions
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Juan Cole offers a short history lesson on the roots of the Egyptian revolution. His conclusion:

The Nasserist state, for all its flaws, gained legitimacy because it was seen as a state for the mass of Egyptians, whether abroad or domestically. The present regime is widely seen in Egypt as a state for the others– for the US, Israel, France and the UK– and as a state for the few– the Neoliberal nouveau riche. Islam plays no role in this analysis because it is not an independent variable. Muslim movements have served to protest the withdrawal of the state from its responsibilities, and to provide services. But they are a symptom, not the cause. All this is why Mubarak’s appointment of military men as vice president and prime minister cannot in and of itself tamp down the crisis. They, as men of the System, do not have more legitimacy than does the president– and perhaps less.

Who took your money

Crisis? What Crisis?, Life under Capitalism
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Lenny looks at the Merrill Lynch Cap Gemini World Wealth Report and sees how the richest people in the world took more of our money thanks to the economic crisis:

The total liquid wealth of the rich in 2009, at $39 trillion, was actually more than two-thirds of world GDP in the same year, almost triple the GDP of the US, and nearly ten times that of China. Another way of looking at it is that the increase in liquid assets from 2008 to 2009 held by the rich was about $6.5 trillion, more than 10% of total GDP in 2009. This was in a year in which world GDP actually shrank by 0.8%.

The distinction between “economic and market drivers of wealth” is very important, and very telling. Most of the new wealth held by the rich was, as you can see, not produced by economic growth, but by stock market capitalisation. In other words, market relations, sustained by state intervention, facilitated the transfer of wealth from the working class to the rich at a time when most of the world’s economy was such that the direct exploitation of labour could not sustain high profit rates. That’s what the bail-outs did; it’s what they were intended to do. Another intended consequence is that there were not only more high net worth individuals, 10 million of them globally (0.014% of the world’s population), but the ‘ultras’ did far better at increasing their share of liquid assets than mere millionaires – thus wealth became even more concentrated than it had been, among a mere 36,300 people, or 0.0005% of the population. The corollary of this has been, and will continue to be, a general decline in the living standards of the working class in most of the advanced capitalist economies: at the same time as the wealth of the richest grew, global unemployment rose by 14.4%.

A feature, not a bug

Life under Capitalism, Substance abuse
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Radley Balko excerpts a story that shows anti-meth laws regulating the sale of certain cold remedies have led to people making big bucks trawling chemists, buying up these medications and then reselling them at huge profit to meth producers. Balko snarks:

Meth use was also up 34 percent in 2009. So the new laws are inconveniencing law-abiding people who want to treat cold and allergy symptoms, have had either zero or a positive effect on meth use, have lured new people into the meth trade, and have created a bigger market for smuggling meth and meth ingredients into the country from Mexico.

But perhaps we should go easy on the politicians who passed these laws. I mean, it’s not like anyone could possibly have predicted any of this.

Really, it’s a win-win situation: the professional drug warriors have a new reason to keep their budgets intact or increased, the pharmaceutical industry makes money hand over fist from the artificial scarcity of Sudafed and similar drugs, Big Crime has less amateur competition and some lucky duckies get to travel the country buying cold relief cures to make a quick buck, which will come in handy since if I’m not mistaken, the biggest meth using parts of the US are also the most economically depressed.