Sunday, 31 December 2017

Welfare for the poor... welfare for the rich

When we talk about the 'welfare state', we normally think of the poor on benefits:
BBC News - Welfare 'trapping' people in poverty says Duncan Smith
Benefits Street: territorial stigmatisation and the realization of a '(tele)vision of divisions' - Goldsmiths, University of London

Others would argue that the state actually provides welfare for the rich.

Here's a commentary from the United States from a couple of years ago:

Don’t Hate on Welfare Recipients — The Real Parasites are Elsewhere

Kevin Carson| August 7th, 2013

Everywhere you look in the right-wing commentariat, you see the recurring theme of the “underclass” as parasites. Its most recent appearance was the meme of the productive, tax-paying 53% vs. the tax-consuming 47%. And of course there’s the perennial favorite mythical quote attributed to Alexander Tytler, trotted out by many who should know better, about the majority discovering they can vote themselves largess from the public treasury. (If you really believe the majority control the government, or that the government serves the interests of the majority, you should avoid using sharp tools without supervision.)

But mainly there’s an endless supply of resentment against “welfare queens,” and friend-of-a-friend stories about the luxurious tastes of those using food stamps at the checkout line, whose cumulative effect is to reassure the middle class that their real enemies are to be found by looking down, and not up.

If your resentment is directed downward against the “underclass” and recipients of welfare-for-the-poor, it’s most definitely misdirected.

First, let’s look at the little picture, and consider the net effects of state policy on the actual recipients of welfare. Consider how state policies on behalf of land owners and real estate investors, like the enforcement of absentee title to vacant and unimproved land, drives up rents and closes off access to cheap living space. Consider how licensing schemes and “anti-jitney” laws, zoning laws against operating businesses out of one’s home or out of pushcarts, and regulations that impose needless capital outlays and entry barriers or overhead costs, close off opportunities for self-employment. And consider how zoning restrictions on mixed-use development and other government promotions of sprawl and the car culture increase the basic cost of subsistence. You think the money spent on welfare for the poor equals that drain on the resources of the underclass?

Next, look at the big picture. Consider the total rents extracted from society as a whole by the dominant economic classes: The inflation of land rent and mortgages by the above-mentioned absentee titles to unimproved land; the usurious interest rates resulting from legal tender laws and restraints on competition in the supply of credit; the enormous markups over actual production cost that result from copyrights, patents and trademarks; the oligopoly markup (once estimated by the Nader Group at around 20% of retail price in industries dominated by a handful of firms) in industries cartelized by government regulations and entry barriers …

Now consider, out of this vast ocean of rents extracted by state-connected parasites, the miniscule fraction that trickles back to the most destitute of the destitute, in the form of welfare and food stamps, in just barely large enough quantities to prevent homelessness and starvation from reaching high enough levels to destabilize the political system and threaten the ruling classes’ ability to extract rents from all of us. The state-allied landlords, capitalists and rentiers rob us all with a front-end loader, and then the state — THEIR state — uses a teaspoon to relieve those hardest hit.

Every time in history the state has provided a dole to the poorest of the poor — the distribution of free grain and oil to the proletariat of Rome, the Poor Laws in England, AFDC and TANF since the 1960s — it has occurred against a background of large-scale robbery of the poor by the rich. The Roman proletariat received a dole to prevent bloody revolt after the common lands of the Republic had been engrossed by the nobility and turned into slave-farms. The Poor Laws of England were passed after the landed classes enclosed much of the Open Fields for sheep pasture. The urban American blacks who received AFDC in the 1960s were southern sharecroppers, or their children, who had been tractored off their land (or land that should have been theirs, if they had received the land that was rightfully theirs after Emancipation) after WWII.

As Frances Fox Piven and Andrew Cloward argued in “Regulating the Poor,” the state — which is largely controlled by and mainly serves the interest of the propertied classes — only steps in to provide welfare to the poor when it’s necessary to prevent social destabilization. When it does so, it usually provides the bare minimum necessary. And in the process, it uses the power conferred by distributing the public assistance to enforce a maximum in social discipline on the recipients (as anyone who’s dealt with the humiliation of a human services office, or a visit from a case-worker, can testify).

Center for a Stateless Society » Under Capitalism, Welfare State’s Main Function is Corporate Welfare
Center for a Stateless Society » Support C4SS with Kevin Carson’s “‘Privatization’ or Privateering?”
Mutualist Blog: Free Market Anti-Capitalism: Welfare State for the Rich

And here's a commentary from the Guardian from just before the 2015 budget:

Direct aid, subsidies, tax breaks – the hidden welfare budget we don’t debate

Vast sums are handed out in corporate welfare and official silence is skewing the debate, so the public don’t know where billions of their own taxes are going

George Osborne will chop into the social security budget, with measures that will raise about £900m – the same sum as the state gives every year to managers who buy shares in their startup under the Enterprise Management Incentive. Photograph: Peter Byrne/PA

Aditya Chakrabortty

Tuesday 7 July 2015

In 2013, just days before laying out his autumn statement, George Osborne told the BBC: “The cost of welfare is one of the things that makes the public finances unsustainable. We need an affordable state.” The government had to cut the bloated welfare state because it was sucking up too much money.

Yet in the financial year ending March 2013, the Guardian can reveal, Britons handed £93bn in welfare to corporations. That is enough to wipe out at a stroke this year’s budget deficit – and it was given to companies in direct aid, subsidies and tax breaks.

The term “corporate welfare” may sound unfamiliar to some. In the Westminster thesaurus, welfare appears alongside benefits and social security as a term for public spending targeted at individuals and households. But corporations rely on public funds, too.

When Richard Branson’s Virgin Atlantic took £28m from the Welsh government in 2011 to set up a call centre in Swansea, that was a form of welfare. The German, French and Dutch companies that now run our train services are subsidised by the British public to the tune of hundreds of millions. The £45bn taken by firms in corporate tax benefits is a form of welfare. So is the ultra-low cost insurance scheme the government runs for exporters such as BAE Systems.

None of these are labelled corporate welfare, but that’s precisely what they are: direct public spending aimed at protecting and supporting businesses.

In many cases, the basic facts about this spending are almost impossible to find. Some of the information making up the calculations published by the Guardian – fundamental stuff such as which arm of the British state gave how much cash to which firm – is so hard to collate that even experts are forced to admit defeat.

Discussions about corporate welfare take place at the twilight checkpoint between economics and democracy. Researchers and civil servants know a lot about the individuals who claim hundreds in, say, employment support allowance: every last cough, spit and missed appointment at the jobcentre. Yet of the big companies that rake off millions in direct grants, taxpayers often hear very little. The result is that the public do not know where billions of their own taxes are going.

Yet were they to be widely known, the facts about corporate welfare would electrify our debates about public spending and the role of the state. On Wednesday, Osborne will set about chopping into our social security budget. Among the measures he is believed to be considering is taxing disability benefits. That will raise about £900m, according to the Institute for Fiscal Studies. That is about the same sum as the state gives every year to managers who buy shares in, say, their dotcom startup and see them soar in value, without having to pay much tax on the gain, thanks to a scheme called Enterprise Management Incentives.

Revealing how far taxpayers fund the private sector is not the same thing as saying the private sector should not receive any public subsidy at all. All rich countries do it, although there is evidence from the OECD thinktank and others that when it comes to corporate tax benefits or public-sector outsourcing, Britain is more indulgent to businesses than many other nations. But many might back public funding for green technology startups, say, or struggling social enterprises in deprived areas. The fundamental point, surely, is to allow public debate over where public funds go.

Full disclosure of the size of the corporate welfare state might also have improved economic debate over the past half-decade. When Cameron and Osborne launched their austerity programme in 2010, they argued that the public sector was “crowding out” the private sector. To enable the economy to grow, government needed to retreat and allow businesses to fill the void. That powerful argument was disproved over the next few years, as Britain stuttered and stumbled through the weakest economic recovery in its modern history. But it would have been undermined from the start had ministers been confronted with £93bn of proof that the relationship between public and private sector is far more complicated.

This research on corporate welfare takes you to the heart of one of the biggest arguments in British capitalism. For decades, the UK has operated on the basis that it is in an international dogfight to attract investment. It was summed up by Michael Heseltine in his 2013 report on industrial policy: “Unless we make it worthwhile for footloose capital to come here, it won’t.”

This orthodoxy has been swallowed by all the main political parties. It has led to the slashing of corporation tax rates, so that Britain has a lower corporation tax rate than the US, Japan or Germany. It has encouraged devolved administrations in Holyrood and Cardiff to disburse millions to big companies, without demanding much in return. The result has been fiscally disastrous. As this research shows, of the 44 companies that received more than £1m in government grants between 2005 and 2011, 13 paid no corporation tax at all; a further 17 did not pay any corporation tax either the year before or the year that they received public money.

Such a state of affairs reflects a severe imbalance of power between the public and private sectors. As Philip Baker QC, a European tax expert and Treasury adviser on the Google tax, remarked last month: “I don’t think in the last 20 years or so one can say that governments have driven corporation tax policy. It’s the large companies that have driven the direction of corporate tax policy.”

The result is a stratum of businesses that is not beholden to the same social settlement as previous generations. Modern big business has got so used to tax breaks, handouts and easy ways of making cash (such as squeezing staff pay and conditions) that it no longer researches or innovates.

Meanwhile, politicians and officials tout for investment, no matter how fly-by-night. But even the savviest operators get caught out. AstraZeneca was assisted by a local MP to get a £5m government grant to develop its research and development centre at Alderley Park, Cheshire. Five months later, in 2013, it announced it was closing the plant and shedding 2,100 jobs. Absent from the public record is what it told its local MP. He was, of course, the chancellor, George Osborne.

Direct aid, subsidies, tax breaks – the hidden welfare budget we don’t debate | Politics | The Guardian
The £93bn handshake: businesses pocket huge subsidies and tax breaks | Politics | The Guardian

In fact, those who criticise 'the state' should be directing their attention to the 'primary' interventions - and not the 'secondary' ones:

Some forms of state intervention are primary. They involve the privileges, subsidies, and other structural bases of economic exploitation. This is the primary purpose of the state: the organized political means to wealth, exercised by and for the ruling class. Some, however, are secondary. Their purpose is stabilizing, or ameliorative. They include welfare state measures, Keynesian demand management, and the like, whose purpose is to limit the most destabilizing side-effects of privilege, and to secure the long-term survival of the system.

The kind of “free market reform” typically issuing from corporate-funded “libertarian” think tanks and politicians involves eliminating only the ameliorative or regulatory forms of intervention, while leaving intact the primary structure of privilege and exploitation.

The strategic priorities of real libertarians should be just the opposite: first to dismantle the fundamental, structural forms of state intervention whose primary effect is to enable exploitation; and only then to dismantle the secondary, ameliorative forms of intervention which serve to make life bearable for the average person living under a system of state-enabled exploitation. As Jim Henley put it, remove the shackles before the crutches.

Regulations that simply limit and constrain the exercise of privilege do not involve, properly speaking, a net increase in statism at all. They are simply the statist ruling class’s stabilizing restrictions on its own more fundamental forms of intervention.

When the state confers a special privilege on an occupation, a business firm, or an industry, and then sets regulatory limits on the use of that privilege, the regulation is not a new intrusion of statism into a free market. It is, rather, the state’s limitation and qualification of its own underlying statism. The secondary regulation is not a net increase, but a net reduction in statism. On the other hand, the repeal of the secondary regulation, without an accompanying repeal of the primary privilege, would be a net increase in statism. Since the beneficiaries of privilege are a de facto branch of the state, the elimination of regulatory constraints on their abuse of privilege has the same practical effect as repealing a constitutional restriction on the state’s exercise of its own powers.

Brad Spangler used the analogy of gunman and bagman to illustrate the relationship between the state apparatus and the corporate ruling class. To apply that analogy here, a great deal of alleged statism amounts to the gunman telling the bagman, after the victim has handed his wallet over at gunpoint, to give the victim back enough money to pay cab fare back home so he can keep on earning money to be robbed of.

When the state is controlled by robbers, and every decision for or against state intervention in a particular circumstance reflects the robbers’ strategic assessment of the ideal mixture of intervention and non-intervention, it’s a mistake for a genuine anti-state movement to allow the priorities for “free market reform” to be set by the robbers’ estimation of what forms of intervention no longer serve their purpose. If the corporate-funded “libertarian” think tanks and the corporate stooges in government are proposing a particular “free market reform,” you can bet your bottom dollar it’s because they believe it will increase the net level of statist exploitation.

The measure of statism inheres in the functioning of the overall system, not in the formal statism of its separate parts. A reduction in the formal statism of some separate parts, chosen in accordance with the stategic priorities of the statist exploiters, may result in a net increase in the overall level of statism.

So don’t resent the folks who get welfare and food stamps. Your real enemies — the ones the state really serves — are above, not below.

Center for a Stateless Society » The Only Thing Dumber Than Libertarianism’s Critics are its Right-Wing Defenders
Center for a Stateless Society » The “Progressive” Welfare State Fantasy

Saturday, 30 December 2017

Finance, ideology and infrastructure


Of late, several issues around 'infrastructure' have been news...

The chair of the National Infrastructure Commission has just resigned:
Andrew Adonis quits as May infrastructure adviser - Financial Times

And he has quite a history: 

Adonis was a transport minister too, and leaves the High Speed 2 rail link, planned to open in 2025, as his monument. But he was also an education minister in Tony Blair’s government, creating academy schools, which have helped improve the life chances of hundreds of thousands of people. And he created Teach First.
Naturally, his achievements are controversial, but as a force for change Adonis has had no equal. He continued to drive ambitious and creative ideas as chair of the National Infrastructure Commission, to which George Osborne appointed him in 2015, because he wanted the Commission to have the “bipartisan authority to generate a national consensus over long-term thinking”. So much for that high-sounding idea.

Andrew Adonis’s resignation means the fight against Brexit may be turning into a campaign to rejoin the EU | The Independent

Another area has been rail infrastructure:

"We are in this crisis over the East Coast franchise where hundreds of millions of pounds is essentially being gifted to private companies by letting them off their contracts early. I have been pointing this out, the Government would far rather I wasn't pointing this out."
The Government was forced to deny claims it was bailing out private companies earlier this month after ministers said it would be intervening on the franchise and terminating the contract three years early. The franchise is operated by Stagecoach and Sir Richard Branson's Virgin.

Lord Adonis hits out at Transport Secretary over East Coast rail 'bailout'

And earlier this month Lord Adonis had yet another bone of contention - shared by many in these rural parts:
Mobile phone and broadband services need 'radical improvement' - BBC News
Lord Adonis says Ofcom must tackle 'deplorable' mobile coverage | Technology | The Guardian

Although Lord Adonis' HS2 initiative is facing more questions over money:
MPs call for legal action over 'shocking' HS2 payouts | UK news | The Guardian
HS2 redundancy pay 'shocking waste' of taxpayer cash - BBC News
Consider legal action over HS2 redundancies, MPs say


Last month MPs showed they are not impressed by the huge sums thrown at Hinkley:
British MPs question value of Hinkley Point project - World Nuclear
We’ve been nuked by Hinkley Point | Business | The Times & The Sunday Times

This piece from the FT earlier in the year was excoriating: 

The uncomfortable truth of UK infrastructure plans

From HS2 that benefits the few to Hinkley Point and its radioactive finances


The Infrastructure and Projects Authority has kindly brought us up to speed with the government’s major projects portfolio, worth a handy £455bn. The annual report is a cheery, upbeat document with encouraging examples of things that are going well, such as the Super Connected Cities Programme (who knew?). It’s not until you reach the pretty colour-coded summary of all the projects that the uncomfortable truth emerges.

The authority shades these from dark green (textbook) through green (OK) to amber (significant problems) amber/red (it’s all going wrong) and red (no realistic chance of success). Few projects are red. They include new reactor cores for nuclear submarines, the perennial problem of the A303 at Stonehenge and the M20 lorry area.

None of these moves the dial on public spending. One that does in the amber/red category is the HS2 rail link, that vanity project to connect Birmingham faster for the few at the expense of the many. It’s particularly rich that the authority’s latest verdict should coincide with transport secretary Chris Grayling scrapping three modest rail electrification plans (all also amber/red). As Private Eye has been warning for years, Network Rail never had a hope of meeting its commitments, so Mr Grayling is punishing it by restricting the state-backed company to maintenance rather than capital projects.

The money sink that is HS2 goes ahead, apparently, despite generous pay-offs to executives before a rail sleeper has been laid. Should this project obey the definition of a builder’s estimate — a sum equal to half the final cost — as one rail expert expects, the bill will be more than £100bn.

Surely not, says Mr Grayling, just look at the London Olympics — which shows that at least the transport secretary has a sense of humour. The final cost there was almost four times the initial estimate. The award of a major HS2 construction contract to Carillion, a company whose liabilities exceed its assets, suggests ominously that if the company’s bondholders do not rescue it, the taxpayer will.

Then there is Hinkley Point. Did you know that it’s all going swimmingly? It’s rated dark green, meaning “Successful delivery of the project on time, budget and quality appears highly likely.” This is the nuclear power station that nobody wants and the subject of (another) damning report from the National Audit Office.

Hinkley Point promises financial misery for the owner, the contractors and finally to every British business and household through higher costs for electricity. The owner, EDF of France, is in poor shape financially and struggling to make its home-built prototype comply with escalating safety regulations. It has just added two years and £1.5bn to the estimated Hinkley start-up date.

Britain’s nuclear policy dates back to 2008, an age when the oil price was only going to rise. Nine years on, the world has changed. The combination of abundant oil and gas and rising regulatory costs have sounded the death knell for big nuclear fission plants.

The NAO currently estimates the Hinkley Point subsidy at £60bn, locking Britain into high energy costs at a time of world abundance, with a devastating impact on competitiveness. The calculation, on the government’s estimates of fossil fuel prices, that a three-year delay will actually save consumers money is a demonstration of how barmy this whole fiasco has become.

Thanks to the sleight-of-hand — otherwise known as a “contract for differences” — with EDF, this financially radioactive project does not appear as a liability in the public accounts. The pain will appear in electricity bills. It’s a pretty brutal way to persuade us to use less energy.

The uncomfortable truth of UK infrastructure plans

And last week's Guardian's 'long read' piece detailed how eventually 'vast nuclear projects will be defeated by economics alone':

Hinkley Point: the ‘dreadful deal’ behind the world’s most expensive power plant

Building Britain’s first new nuclear reactor since 1995 will cost twice as much as the 2012 Olympics – and by the time it is finished, nuclear power could be a thing of the past. How could the government strike such a bad deal? 

Fri 22 Dec ‘17

Hinkley Point, on the Somerset coast, is the biggest building site in Europe. Here, on 430 acres of muddy fields scattered with towering cranes and bright yellow diggers, the first new nuclear power station in the UK since 1995 is slowly taking shape. When it is finally completed, Hinkley Point C will be the most expensive power station in the world. But to reach that stage, it will need to overcome an extraordinary tangle of financial, political and technical difficulties. The project was first proposed almost four decades ago, and its progress has been glacial, having faced relentless opposition from politicians, academics and economists every step of the way.

Some critics of the project have questioned whether Hinkley Point C’s nuclear reactor will even work. It is a new and controversial design, which has been dogged by construction problems and has yet to start functioning anywhere in the world. Some experts believe it could actually prove impossible to build. “It’s three times over cost and three times over time where it’s been built in Finland and France,” says Paul Dorfman, from the UCL Energy Institute. “This is a failed and failing reactor.”

Others have pointed to the cost. At present, the estimated total bill for Hinkley Point C is £20.3bn, more than twice the London Olympics. To pay for it, the British government has entered into a complex financial agreement with Électricité de France (EDF), the energy giant that is 83% owned by the French government, and China General Nuclear Power Group (CGN), a state-run Chinese energy company. Under this contract, British electricity consumers will pay billions over a 35-year period. According to Gérard Magnin, a former EDF director, the French company sees Hinkley as “a way to make the British fund the renaissance of nuclear in France”. He added: “We cannot be sure that in 2060 or 2065, British pensioners, who are currently at school, will not still be paying for the advancement of the nuclear industry in France.”

Many British observers agree that the deal is ludicrously favourable to EDF – “a dreadful deal, laughable” says Prof Steve Thomas, who works on energy policy at the University of Greenwich. But even insiders at EDF aren’t entirely happy with it. In the months before the EDF board finally signed off the deal in autumn 2016, the finance director resigned, along with Magnin. “The Hinkley Point project remains very risky,” Magnin told me. He is particularly concerned about EDF’s ability to complete the project before the current deadline of 2025. “Why have we reached this point?” asked Magnin. “It is the construction of a house of cards.” ...

Hinkley Point: the ‘dreadful deal’ behind the world’s most expensive power plant | News | The Guardian


On the one hand, free-market think tank the Cato Institute questions the Keynsian boost to the US economy of more government infrastructure:

Would More Government Infrastructure Spending Boost the U.S. Economy?

By Ryan Bourne

June 6, 2017

The focus on the supposed stimulus and productivity-enhancing effects of infrastructure spending means policy debates center heavily on government funding. 
Yet proposals for more federal spending, costly tax credits, or public-private partnerships ignore that the primary barriers to responsive infrastructure relate to structures and incentives. 
Rather than imposing further costs on taxpayers, the new administration should prioritize localizing decisionmaking, removing regulatory barriers to private investment, encouraging the use of user fees, and removing tax exemptions for public investment.

Would More Government Infrastructure Spending Boost the U.S. Economy? | Cato Institute

On the other hand, here's a view from a member of the Advisory Council of Infrastructure UK - who suggests authoritarian China as a model:

Free markets are a flawed way to plan and fund infrastructure

A centrally planned economy for some leaders is a blight on freedom, writes Keith Burnett

Opinion UK infrastructure

Artist's impression of the Birmingham and Fazeley viaduct on the proposed HS2 project

SEPTEMBER 14, 2015

One night in 1942, a man sat on the roof of King’s College, Cambridge, scanning the skies for German bombers. This lookout was well acquainted with the totalitarianism the Nazis wanted to impose. Having served on the Italian front during the first world war, the economist Friedrich Hayek had returned to Vienna to find it devastated by out of control price rises.

His conclusion was that centrally planned economies like Vienna’s were prone to hyperinflation and tyranny. It formed the heart of his 1944 book, The Road to Serfdom. For leaders who embrace his ideas, such as Britain’s Margaret Thatcher, a centrally planned economy is not just inefficient but a blight on freedom.

Today, under Hayek’s heirs, Britain’s infrastructure funding lies in an unhappy state of halfway-house marketisation. Long-range planning has been replaced by the short-termism that typifies the markets.

Meanwhile, lobby groups have the power to halt essential schemes. The result is a tendency to delay procurement of desperately needed infrastructure projects.

Take the HS2 railway between London and the Midlands. According to the government, it is vital to rebalance the economy away from the south east. But HS2 is battled by environmentalists, residents and taxpayers. It will be 2026 before the first 250mph trains can run.

In China, by contrast, there is no fear of big projects and no problem finding long-term investment. Its Shanghai-Beijing high-speed railway covers 1,300km in less than five hours. The job was completed within four years.

Similarly, the UK seems unable to settle on the best way to generate its power. A steady supply of nuclear energy, insulated from the volatility of the oil and gas market, would benefit consumers, companies and the economy. While the government threw the Hinkley Point C nuclear power station project open to the markets, it then had to guarantee above-market prices for 35 years in order to convince the French state-owned EDF to invest for the long term. Even so, EDF will not bring the plant into operation in 2023 as scheduled.

The question now is whether we choose instead to reach an explicit public consensus on the industrial and infrastructural needs of the nation. If we do that, would we be taking steps down the low “road to serfdom”? Or would that consensus promote conditions in which markets can provide consumers with what they need at a fair cost?

Our democratic process has prevented a completely free market for the National Health Service, schools and universities as well as in defence. British governments have been forced by public opinion to distance themselves from a wholesale embrace of the free market, and disingenuously speak of “consumer choice” mixed with regulation — the latter is state intervention by another name.

Hayek’s supposed disciples miss the fact that he acknowledged there are circumstances in which the market cannot work. National security and infrastructure may require government-decreed objectives: “There are common needs that can be satisfied only by collective action and which can be provided for without restricting individual liberty.”

Hayek was right about this. What we learn from China is that economic growth and civil prosperity cannot be delivered without giving governments responsibility for essential schemes.

Back on that chapel roof, it is possible that Hayek kept watch there alongside John Maynard Keynes, a fellow at the same college. Both were committed to the nation’s liberty. Keynes, an advocate of state intervention in infrastructure planning, later wrote to Hayek, asking: why and when do you need to intervene? Seven decades later, as our country struggles to update its transport infrastructure or replace ageing power stations, the need is as urgent as ever.

The writer is vice-chancellor of the University of Sheffield

Free markets are a flawed way to plan and fund infrastructure - Financial Times


Meanwhile in the United States, all the talk is about 'infrastructure':
Trump to announce plan aimed at fixing crumbling roads and bridges, source says - ABC News
Trump administration set to unveil $1 trillion infrastructure proposal in 2018 - Washington Examiner

But it doesn't look too promising:
States see Trump's infrastructure promise slipping away - Dec. 19, 2017 - CNN
Five obstacles to Trump's infrastructure ambitions | TheHill
One wrong move and Trump's infrastructure goals will come to a screeching halt | TheHill

With a handy overview from the White House Chronicle on PBS:

The coming year will be a year of talking about infrastructure. But you cannot cross a bridge with mere words, let alone repair it.
In what is going to be a financially constrained year, as the consequences of the tax cut are digested, look for big hopes and small dollars.
The midterm elections will dominate. Therefore, Republicans will push for privatizing the air traffic control system and initiating private-public partnerships in things where there will eventually be a revenue stream to justify the private investment — possibly seaports; possibly selling off federally owned properties, such as some airports; and giving accelerated regulatory relief to projects like new pipelines and transmission lines, one of the most difficult infrastructure undertakings.
During his presidential campaign, Trump talked about new infrastructure funding of $1 trillion. Now the talk is in the low billions. To really understand such a climbdown, understand that a trillion is a thousand billion. Real money. Two billion dollars — which has been bandied about lately — is, well, you do the math — it’s peanuts.

The infrastructure challenge — a lot to do, little time, money - San Antonio Express-News

And to finish, here's a view of the bigger picture from Common Dreams:

Will Trump’s Infrastructure Plan Become Another Attack on Democracy?

Published on Wednesday, December 27, 2017
by Common Dreams

Converting public things into private goods reinforces a trend toward corporate oligarchy.

by John Buell

"Things have not worked out and privatization has become a means by which politically and socially well positioned have increased their power." 

President Trump promises rapid economic growth compliments of his tax cut. Even if he is correct, however, the private sector expansion he celebrates will likely leave huge holes acknowledged even by many conservative economists. California is burning. Our highways, sewers, bridges, and tunnels are now graded at nearly failing. There is widespread agreement that repairs and restoration of our infrastructure must be funded on a massive scale. Yet what shape will this spending assume? Which projects will be funded? Who will own the new and renovated structures and with what responsibilities? If the tax cut model of gifts to the wealthy and well positioned is followed, the damage will include not only inconvenient or poorly maintained rails, roads, and other public services but also further erosion of our democracy itself.

In a prophetic essay a year ago in Boston Review Brown University political theorist Bonnie Honig, author of Public Things: Democracy in Disrepair, pointed out that the Trump family’s decision to opt out of residence at the White House in favor of life in Manhattan or Florida reflected a disdain for pubic things. Neoliberals differ on some issues, but one key notion most hold is the right to opt out of publically provided services or goods one does not need or want. This neoliberal mindset imposes substantial burdens on the rest of us. A recent Wall Street Journal article only confirms Honig’s concerns. The Wall Street Journal found that the president has spent more than 100 days at one of his properties, including more than a month each at his golf course in New Jersey and at Mar-a-Lago in Florida. Citizens for Responsibility and Ethics in Washington points out: ”visits to his properties in Florida costs the local Palm Beach government so much that it considered raising taxes.”

The opt- out culture has more widespread and destructive effects. As Honig puts it: “Charter schools and voucher programs invite locals to opt out of public schools while drawing on public funds that might have improved the public education system rather than provide an alternative to it.” When these schools succeed, often by excluding special needs children, their success is taken as proof of the inadequacy of public education.

Neoliberals generally resist or seek to limit the services that are provided by public entities. When these must be provided, the service should be privately owned and run like any other profit maximizing business. This requirement, however, exposes some of the tensions and contradiction within neoliberalism. What if, as is often the case, there are very few businesses that can provide the service? Won’t these firms be in position to charge monopoly prices for their services? If you believe in limited government—at least limited with respect to any possible downward redistribution—you will allow monopoly to serve in the faith that in the long run everything will work out. Economists more attuned to the real concerns that Smith, Mill, and Ricardo voiced regarding monopolies will demand anti trust or insist on regulation of “natural monopolies.”

In recent times, both here and internationally, the former course has prevailed. Things have not worked out and privatization has become a means by which politically and socially well positioned have increased their power. But it was not always that way. University of Missouri-Kansas City economist Michael Hudson puts it thus:

“To prevent such price gouging and to keep economies competitive with low costs of living and doing business, Europeans kept the most important natural monopolies in the public domain: the post office, the BBC and other state broadcasting companies, roads and basic transportation, as well as early national airlines. European governments prevented monopoly rent by providing the basic infrastructure services at cost, or even at subsidized prices or freely… The guiding idea is for public infrastructure to lower the cost of living and doing business…[With privatization]. the economy ends up being turned into a collection of tollbooths instead of factories…”

Trump’s detailed infrastructure proposals still are not out, but early suggestions about tax credits to corporations that supply such infrastructure are problematic. Corporations are likely to invest only in those projects with likelihood of monopoly profits, i. e. those where they can impose their own tollbooth. This will leave some very important services underdeveloped and others overly costly or inconvenient.

Converting public things into private goods reinforces a trend toward corporate oligarchy. Traditional fiscal conservatives hide their support of oligarchy behind warnings of dire consequences of government overspending. Their stated reason for opposition to generous public spending on public goods is a concern about possible bankruptcy. Ad nauseam they chastise us: Just as families that splurge beyond their means go bankrupt so too will nations that spend too much on public goods. The analogy is false. Our government, unlike its citizens, controls and issues its own currency. Trillions poured into the economy by the Federal Reserve for the bank bailout occasioned little more than a yawn in world financial markets and no inflation.
Republicans’ and centrist Democrats’ concerns about the debt are a smoke screen to attack Social Security. Neoliberals’ real fear is the greater equality generous public things might foster and the coalitions across borders, ethnicities, and faiths the construction and maintenance of such goods might encourage. Honig puts the case in Whitmanesque language: “The democratic experiment involves living cheek by jowl with others, sharing classrooms, roads, and buses, paying for them together, complaining about them together, and sometimes even praising and enjoying them together, as picnickers will do on a sunny afternoon in Central Park. But the neoliberal corrective absolves us of this necessity and responsibility. That Central Park—landscape architecture’s ode to the power of democratic beauty—is just a stone’s throw away from the barricaded Trump Tower is only one of the many sad ironies of the story to be told here.”

Public things and the democratic space they foster and are fostered by encourage both collective responses to common problems and an opportunity to address the injustices (remainders) that emerge from even the most egalitarian and idealistic processes. The physical state of our infrastructure reflects more than conventional faith in balanced budgets. It is an attack on democracy and must be resisted by appealing to and enhancing democracy itself.

Will Trump’s Infrastructure Plan Become Another Attack on Democracy? | By John Buell | Common Dreams

Friday, 29 December 2017

Book of the year >>> >>> Matthew D’Ancona’s 'Post-Truth: The New War on Truth and How to Fight Back' >>> >>> "The only reliable engines of change are the people themselves."

Looking at the Guardian's list of best books of the year, this is a favourite:

In a year when the dance between evidence, lies and democracy has dominated headlines on both sides of the Atlantic, we’ve seen a clutch of books trying to make sense of the “post-truth” phenomenon. I found Matthew D’Ancona’s short but arresting Post-Truth: The New War on Truth and How to Fight Back the best of the bunch.

Favourite reads of 2017 - as chosen by scientists | Science | The Guardian

With plenty of other good reviews of the book:
Post-Truth by Evan Davis; Post-Truth by Matthew d’Ancona; Post-Truth by James Ball | Saturday Review | The Times & The Sunday Times
The truth about the post-truth age - Financial Times

The issues go much further, though.

This blog has already considered a couple of related topics:
Futures Forum: "Seeking truth in public life is the citizen’s responsibility"
Futures Forum: Fake news, the UK general election and local news

And we are going to be going to into much scarier territory:
Virtual reality is coming. What does that mean for post-truth news? - Reaction

It isn't 'just politics' which is being infected by the post-truth world:
Lies and chatbots are also undermining commerce - Raconteur

And we can't simply say it's 'them' who have got us into this mess:
Matthew d’Ancona on the post-truth age - We can’t just blame politicians for the post-truth age we live in - slate.com

The New European carried an excerpt from D'Ancona's book earlier in the year - focussing on 'citizenship':

(1) Marlon Brando in Apocalyose Now (2) A young resident of Prague climbs onto a Soviet T-54 tank 1968 (3) President Franklin Delano Roosevelt (4) Martin Luther King Jnr Photo:Getty/ TopFoto of change. 

In the second part of our exclusive serialisation of his new book Post Truth: The New War on Truth and How to Fight Back, MATTHEW D’ANCONA explains how the tide can be turned back on our age of distrust


July 7-July 13, 2017

In Apocalypse Now, Marlon Brando as Colonel Kurtz asks Martin Sheen’s Willard to tell his son all he has seen at his Cambodian compound: ‘Everything I did, everything you saw, because there’s nothing that I detest more than the stench of lies. And if you understand me, Willard, you will do this for me.’

Dubious a role model as Kurtz surely is, he reminds us that lies contaminate all they touch – including, in his case, basic sanity.

The greatest peril of the Post-Truth era is that our sense of smell has failed us. We have become indifferent or inured to ‘the stench of lies’, resigned to the malodorous atmosphere of competing truth claims. To put it another way: the flames of democratic collapse are not yet consuming our society. But our collective smoke alarm is faulty.

Conceivably, it may be reactivated by the experiences that lie ahead. Umberto Eco argued that realism would always reassert itself when we encountered ‘lines of resistance’. We cannot walk through walls, survive underwater without oxygen, or drive through a dead-end. Politics and culture have their equivalents. The votes for Brexit and for Trump were fed by reactionary sentiment but also – definitively – by an insistence upon change.

Whatever else happens in this particular presidency and this particular rearrangement of Britain’s relationship with the rest of Europe, the expectations raised on both sides of the Atlantic cannot possibly be satisfied. When the promise of transformation fails and the public encounters its own ‘lines of resistance’ – a moment of maximum social danger – it will be a civic duty of great urgency to assert the value of truth in political debate.

What cannot be assumed is that this will happen of its own accord, as an organic response to disenchantment. If anything, political disappointment is the handmaiden of Post-Truth, a solvent of trust and a cue to further tribal huddling. The task cannot wait. It is much too pressing to be postponed sine die. If the truth is to reclaim its position of priority in our culture, we must put it there.

At the heart of this challenge is the notion of citizenship. In two specific respects, the twentieth century eroded that ancient concept of conjoined rights and responsibilities.

In spite of persistent revisionist claims to the contrary, the dramatic expansion of the state after the Second World War was necessary as a civilising force to enable the spread of education, healthcare and welfare provision. If anything, twentyfirst century conservatives are rediscovering the merits of government – at least in principle – after decades of promises to ‘roll back its frontiers’.

But there is no denying the flipside of the state’s growth in the past 70 years – which is the partial infantilisation of the public it serves. As much as the modern electorate despises politicians, it still turns to them reflexively for solutions to everything. Our instinctive response to a problem is to say: ‘they should do something about that’. But who are ‘they’? ‘They’ used to be ‘us’.

This delegation of civic responsibility to the very political class we claim to deplore has been compounded by a quite distinct trend, most associated with, though not confined to, governments of the centre right. The reframing of public services as retail products, and of patients, parents and passengers as customers has not only blurred the boundary between the state and the private sector. It has also made citizenship increasingly indistinguishable from consumerism.

What are euphemistically called ‘flexible labour practices’, zero-hour contracts and the rise of the gig economy, have tended to strip work of its centrality to human experience. The conventions of the lifetime career are long gone. Automation and outsourcing now threaten the very future of work – or so it seems.

What remains is consumption: no bad thing in itself, until it starts to define us. When the things you can buy online matter more to you than the things you can do in your neighbourhood; when you communicate with the social media ‘friends’ you never meet more than you see your real friends; when your notion of the ‘public space’ is confined to the screen in your hand: all this removes the sinew from citizenship. It encourages the passivity that is so important to Post-Truth.

Statesmanship can and has made a difference. Franklin Roosevelt’s fireside chats were an appeal to civic spirit, rooted in an insistence upon the sovereignty of truth. As he put it on May 27, 1941: ‘The pressing problems that confront us are military and naval problems. We cannot afford to approach them from the point of view of wishful thinkers or sentimentalist. What we face is cold, hard fact.’

Sound public policy can play a part in the resistance to Post-Truth. It is encouraging, for instance, that the Culture, Media and Sport Select Committee of the House of Commons, under the chairmanship of Damian Collins, has been swift to launch an inquiry into fake news and its ‘threat to democracy’.

The ‘Nudge’ school of behavioural economics has also shown that government can steer citizens away from misinformation towards fact-based decisions – about health, personal finance, the environment and nutrition – through encouragement rather than the blunt instrument of legislation and regulation.

It has been argued, more provocatively, that there are cases when government has a duty to ignore the objections of the misinformed minority – a duty often cited in the case of compulsory fluoridation – and to take action ‘mandating protection from the dangers of misinformed activity’.

But even the most ardent champions of Jeffersonian democracy concede that there is no glibly paternalistic answer to PostTruth. Indeed, how could there be? Leadership may be a necessary condition
But – especially in an age of distrust – it is no longer sufficient (if it ever was, at least in democratic societies). As Martin Luther King wrote in his ‘Letter from Birmingham Jail’ (1963), indifference is the greatest challenge to those who speak the truth:

The Negro’s great stumbling block in his stride toward freedom is not the White Citizen’s Councilor or the Ku Klux Klanner, but the white moderate, who is more devoted to ‘order’ than to justice; who prefers a negative peace which is the absence of tension to a positive peace which is the presence of justice; who constantly says, ‘I agree with you in the goal you seek, but I cannot agree with your methods of direct action.’ ... Shallow understanding from people of good will is more frustrating than absolute misunderstanding from people of ill will. Lukewarm acceptance is much more bewildering than outright rejection.

In a few majestic sentences, King captured the principal psychological barrier that confronts any agent of change. The story of mankind is the story of the battle between indifference and commitment, within people as well as between them.

For many, conformity is the default position. The parapet is there for a reason: so you don’t stick your head above it. Inertia is the safe option – until it isn’t. Which is to say that we often regret our earlier passivity only when it is too late.

Of this much we can be sure. The renewal of citizenship will not be imposed from above. If people want an end to the Post-Truth era, they must will it themselves. If, having encountered its disagreeable consequences (Eco’s ‘lines of resistance’), they want a change, they must demand it. The phrase ‘people power’ has been debased by overuse, but it is not without meaning. In John le Carré’s novel The Secret Pilgrim, the veteran spymaster George Smiley spells out the facts of the matter to a youthful audience:

It was man who ended the Cold War in case you didn’t notice. It wasn’t weaponry, or technology, or armies or campaigns. It was just man. Not even Western man either, as it happened, but our sworn enemy in the East, who went into the streets, faced the bullets and the batons and said: we’ve had enough ... And the ideologies trailed after these impossible events like condemned prisoners, as ideologies do when they’ve had their day. Because they have no heart of their own. They’re the whores and angels of our striving selves.

There is no romance in this. The revolution of 1989 was the end of a 72 year nightmare, a long haul of cataclysmic suffering, oppression and vanquished resistance. Apartheid exacted an astonishing cost before its fall. And not all popular movements end well, or coherently: one has only to think of the Prague Spring of 1968 or its Arab counterpart in 2011.

But Smiley’s point stands. The only reliable engines of change are citizens themselves. The US Republican Party would not have been transformed as it has been without the organisational power of the Tea Party. The UK Labour Party would not have shifted as it has to the left without the grass-roots energy of the group Momentum. The respective impact of the Occupy movement and Jubilee Debt Campaign is also instructive.

Whatever you think of these specific movements, concentrate upon the form, rather than the content. It is not hard to imagine a similar, loose-knit alliance arising in response to Post-Truth and to the damage it is already doing to our civic fabric: #TellUsTheTruth. The clarion-call ‘don’t mourn – organise!’ is usually associated with the left. But its application need not be confined to any particular ideology.

At the very least, we must affirm the truth in a commanding fashion, instead of merely repeating the lie by denying it. Rationality should be matched by imagination and innovation. If Post-Truth is to be defied and defeated, the endeavour must be collective, sustained and stubborn. There will be setbacks, twists and turns, and moments of exasperation. But if the truth still matters to us as a civilisation this is not a task we can shirk.

■ Matthew D’Ancona is a journalist and author. His latest book Post Truth: The New War on Truth and How to Fight Back is published by Ebury (£6.99)

The New European July 7-July 13, 2017

Thursday, 28 December 2017

Against charity: against philanthropy

It's not just the universally-recognised reality that the poor give more than the rich:

Are the Rich Really Less Generous Than the Poor?

May 24, 2017 by Stephen J. Dubner

LISTEN NOW: Our latest Freakonomics Radio episode is called “Are the Rich Really Less Generous Than the Poor?”

A series of academic studies suggest that the wealthy are, to put it bluntly, selfish jerks. It’s an easy narrative to swallow —but is it true? A trio of economists set out to test the theory. All it took was a Dutch postal worker’s uniform, some envelopes stuffed with cash, and a slight sense of the absurd.

Are the Rich Really Less Generous Than the Poor? - Freakonomics Freakonomics

It's what the philanthropist chooses to spend their donations on:

Why the Rich Don't Give to Charity

The wealthiest Americans donate 1.3 percent of their income; the poorest, 3.2 percent. What's up with that?


Wealth affects not only how much money is given but to whom it is given. The poor tend to give to religious organizations and social-service charities, while the wealthy prefer to support colleges and universities, arts organizations, and museums. Of the 50 largest individual gifts to public charities in 2012, 34 went to educational institutions, the vast majority of them colleges and universities, like Harvard, Columbia, and Berkeley, that cater to the nation’s and the world’s elite. Museums and arts organizations such as the Metropolitan Museum of Art received nine of these major gifts, with the remaining donations spread among medical facilities and fashionable charities like the Central Park Conservancy. Not a single one of them went to a social-service organization or to a charity that principally serves the poor and the dispossessed. More gifts in this group went to elite prep schools (one, to the Hackley School in Tarrytown, New York) than to any of our nation’s largest social-service organizations, including United Way, the Salvation Army, and Feeding America (which got, among them, zero).

Underlying our charity system—and our tax code—is the premise that individuals will make better decisions regarding social investments than will our representative government. Other developed countries have a very different arrangement, with significantly higher individual tax rates and stronger social safety nets, and significantly lower charitable-contribution rates. We have always made a virtue of individual philanthropy, and Americans tend to see our large, independent charitable sector as crucial to our country’s public spirit. There is much to admire in our approach to charity, such as the social capital that is built by individual participation and volunteerism. But our charity system is also fundamentally regressive, and works in favor of the institutions of the elite. The pity is, most people still likely believe that, as Michael Bloomberg once said, “there’s a connection between being generous and being successful.” There is a connection, but probably not the one we have supposed.

Why the Rich Don't Give to Charity - The Atlantic

Earlier this year saw the demise of David Rockefeller, 'the world's oldest philanthropist', the grandson of the granddaddy of philanthropy, John D Rockefeller:
Philanthropist David Rockefeller Dies at 101 | News | PND
World's oldest billionaire David Rockefeller dies age 101 | Daily Mail Online

Indeed, a century ago, the "class question"—who would control industrial profits, who would set wages, whether capitalism was even compatible with democracy—was at the forefront of American politics, the impetus for mass uprisings, partisan warfare, and, for some, the hope of full-blown revolution:
The Rockefellers and class warfare - Slate

It was then that we saw the creation of Public Relations:


By Sean Braswell OCT 24 2015

When the 1,000 men, women and children living in a tent city near Ludlow, Colorado, first saw the National Guard approaching in the fall of 1913, they greeted them with rousing cheers. But the guardsmen had not been sent to protect the striking coal miners from the daily attacks of vigilante gunmen stationed outside the camp — they were there to protect the investment of the Colorado Fuel & Iron Corp., owned by John D. Rockefeller Jr., who happened to be bankrolling both the vigilantes and the guardsmen.

Six months later, on April 20, 1914, those remaining in the camp were sprayed with machine-gun fire by the guardsmen, and the tent colony was torched, killing at least 66, including two women and 11 children who suffocated in a pit they had dug beneath their tent to escape the bullets. The strike failed, but the bloody Ludlow Massacre was a public relations disaster for Rockefeller — one so bad that it required the birth of modern corporate PR to remedy the situation and salvage Rockefeller’s charred legacy from the smoldering ash of the miners’ tents.

“[S]ince the dawn of representative democracy, corporations and political elites have used public relations and lobbying to subvert and subdue democracy,” argue David Miller and William Dinan in A Century of Spin: How Public Relations Became the Cutting Edge of Corporate Power. Still, while publicists had occasionally penned puff pieces to defend company interests from muckraking journalists in the late 19th century, true corporate spin doctors like Ivy Lee, sometimes called the father of public relations, did not emerge until events like Ludlow demanded their talents.

Lee, a Princeton economics grad, had been a muckraking journalist himself, until the long hours and low pay drove him and a friend to open one of the nation’s first PR firms — dedicated to bringing the journalistic principles of “accuracy, authenticity and interest” to the embryonic PR field. For Lee, it was about transparency and helping companies get out in front of potential controversies. For example, U.S. railroad companies had long failed to acknowledge fatal accidents on railway lines, but Lee made sure that reporters were briefed and allowed to inspect the accident scene and question officials, successfully deflecting unwarranted criticism in the press.

But Lee was also a student of what he called the psychology of the multitude and believed that publicity worked best when trained professionals played on “the imagination or emotion of the public.” Presentation was paramount, and the facts, well, they were flexible. As the philosophical Lee put it, “What is a fact? The effort to state an absolute fact is simply an attempt to … give you my interpretation of the facts.”

Ivy Lee’s interpretative skills would be tested like never before in the wake of Ludlow. Earlier, John D. Rockefeller Jr., obsessed with burnishing his father’s robber baron image, had testified before Congress about the miners’ desire to unionize to win better wages and working conditions. Asked two weeks before the massacre if he would stick to his anti-union principle even “if it costs all your property and kills all your employees,” Rockefeller had chillingly replied, “It is a great principle.”

The whole episode, according to an official statement from Rockefeller, was “to be regretted,” but the “defenders of law and property … were in no slightest way responsible for it.”

And that was just the start of Rockefeller’s rehabilitation. The following year, after the miners had returned to work, the industrialist made a well-publicized visit to Ludlow, where he ate with the laborers and announced a plan to address worker grievances. And over time, Lee’s client was recast as a humanitarian and philanthropist, a reputation he still enjoys today.

The Bloody Birth of Corporate PR | Flashback | OZY
100 Years of Modern Public Relations - The Ludlow Massacre

The incident also saw the birth of 'philanthropy':

Power Politics and the Empire of Economics: An Introduction

Andrew Gavin Marshall
MAY 27, 2015 7:00 AM / 9 COMMENTS

But the global financial mafia – and the oligarchs and dynasties who sit at its core – cannot wield significant influence without the political legitimacy that comes with state power. 
Successful financial dynasties (with the Rockefellers as perhaps the best example) establish complex networks of influence, building institutions and supporting ideologies that in turn influence the state and shape the minds and careers of those who rise through it. 
The Rockefeller family established the University of Chicago and have long been patrons of Harvard. They created philanthropic foundations which provided strategic funding to universities, research centers, think tanks and international forums, having a lasting impact on the shaping of the social sciences (notably Political Science and Economics). 
The Rockefeller name has made its imprint on some of the most influential American and international think tanks and forums, including the Council on Foreign Relations, the Bilderberg meetings and the Trilateral Commission, which was founded by David Rockefeller in 1973 in an effort to encourage cooperation between the ‘trilateral’ regions of North America, Western Europe and Japan.

Bringing Down the Empire: Challenging the Institutions of Domination

Andrew Gavin Marshall
MARCH 12, 2012 5:33 PM / 4 COMMENTS

Though it was in the 19th century that revolutionary ideas and new philosophies of resistance emerged in response to the increasing wealth and domination at the top, and the increasing repression and exploitation of the rest. 
In reaction to this development, elites sought out new forms of social control. Educational institutions facilitated the rise of a new intellectual elite, which, in turn, redefined the concept of democracy to be an elite-guided structure, defined and controlled by that very same intellectual elite. 
This led to the development of new concepts of propaganda and power. This elite created the major philanthropic foundations which came to act as “engines of social engineering,” taking a dominant role in the shaping of a global society and world order over the 20th century.

Bilderberg 2011: The Rockefeller World Order and the “High Priests of Globalization”

Andrew Gavin Marshall
JULY 15, 2011 3:59 PM / 46 COMMENTS

The fact that the major American foundations – Rockefeller, Carnegie, and Ford – were so pivotal in the origins of the Bilderberg Group is not a mere coincidence. The foundations have, since their founding at the beginning of the 20th century, been the central institutions in constructing consensus among elites, and creating consent to power. They are, in short, the engines of social engineering: both for elite circles specifically, and society as a whole, more generally. As Professor of Education Robert F. Arnove wrote in his book Philanthropy and Cultural Imperialism:

Foundations like Carnegie, Rockefeller, and Ford have a corrosive influence on a democratic society; they represent relatively unregulated and unaccountable concentrations of power and wealth which buy talent, promote causes, and, in effect, establish an agenda of what merits society’s attention. They serve as “cooling-out” agencies, delaying and preventing more radical, structural change. They help maintain an economic and political order, international in scope, which benefits the ruling-class interests of philanthropists and philanthropoids – a system which… has worked against the interests of minorities, the working class, and Third World peoples.[8]

These foundations had been central in promoting the ideology of ‘globalism’ that laid the groundwork for organizations such as the Council on Foreign Relations and the Bilderberg Group to exist. The Rockefeller Foundation, in particular, supported several organizations that promoted a ‘liberal internationalist’ philosophy, the aim of which:

was to support a foreign policy within a new world order that was to feature the United States as the leading power – a programme defined by the Rockefeller Foundation as ‘disinterested’, ‘objective’ and even ‘non-political’… The construction of a new internationalist consensus required the conscious, targeted funding of individuals and organizations who questioned and undermined the supporters of the ‘old order’ while simultaneously promoting the ‘new’.[9]

The major foundations funded and created not only policy-oriented institutes such as think tanks, but they were also pivotal in the organization and construction of universities and education itself, in particular, the study of ‘international relations.’[10] The influence of foundations over education and universities and thus, ‘knowledge’ itself, is unparalleled. As noted in the book, Philanthropy and Cultural Imperialism:

The power of the foundation is not that of dictating what will be studied. Its power consists in defining professional and intellectual parameters, in determining who will receive support to study what subjects in what settings. And the foundation’s power resides in suggesting certain types of activities it favors and is willing to support. As [political theorist and economist Harold] Laski noted, “the foundations do not control, simply because, in the direct and simple sense of the word, there is no need for them to do so. They have only to indicate the immediate direction of their minds for the whole university world to discover that it always meant to gravitate to that angle of the intellectual compass.”[11]

The major philanthropic foundations created by America’s ‘robber baron’ industrialists and bankers were established not to benefit mankind, as was their stated purpose, but to benefit the bankers and industrialist elites in order to engage in social engineering. Through banks, these powerful families controlled the global economy; through think tanks, they manage the political and foreign policy establishments; and through foundations, they engineer society itself according to their own designs and interests. Through these foundations, elites have come to shape the processes, ideas and institutions of education, thus ensuring their continued hegemony over society through the production and control of knowledge. The educational institutions train future elites for government, economics, sciences, and other professional environments, as well as producing the academics that make up the principle component of think tanks, such as the Bilderberg Group.

Foundations effectively “blur boundaries” between the public and private sectors, while simultaneously effecting the separation of such areas in the study of social sciences. This boundary erosion between public and private spheres “adds feudal elements to our purported democracy, yet it has not been resisted, protested, or even noted much by political elites or social scientists.”[12] Zbigniew Brzezinski, foreign policy strategist, former director of the Council on Foreign Relations, Bilderberg member and co-founder with David Rockefeller of the Trilateral Commission, wrote that the blurring of boundaries “serves United States world dominance”:

As the imitation of American ways gradually pervades the world, it creates a more congenial setting for the exercise of the indirect and seemingly consensual American hegemony. And as in the case of the domestic American system, that hegemony involves a complex structure of interlocking institutions and procedures, designed to generate consensus and obscure asymmetries in power and influence.[13]

In 1915, a Congressional investigation into the power of philanthropic foundations took place, named the Walsh Commission, which warned that, “the power of wealth could overwhelm democratic culture and politics.”[14] The Final Report of the Walsh Commission “suggested that foundations would be more likely to pursue their own ideology in society than social objectivity.”[15] In this context, we can come to understand the evolution of the Bilderberg Group as an international think tank aimed at constructing consensus and entrenching ideology among the elite.