Report from Concord, November 2019

By Ken Wells, NH State Representative

When I was a teenager during the Cold War, I was amused by a comic strip called Spy vs. Spy. Two trenchcoated raven characters appeared only in silhouette, identical in every way yet polar opposites and mortal enemies. One was drawn black on white, and the other, white on black. They were adversaries engaged in an unending intrigue of cross, double-cross, and revenge. It was a struggle which clearly aspired to no higher purpose, and never referenced any actual events playing out in the real world.

As I see a similar cartoon playing out in our nation’s partisan politics, I am not amused. There are grave problems before us today, as there were back during the Cold War. Spy vs. Spy was deliberately blind to the actual problems of the Cold War world, just to provide some dark humor as we faced an existential nuclear crisis. Today we face an existential climate emergency, and our Constitutional democracy is all but paralyzed by the greatest test of its checks and balances within living memory. Our democracy could become irreparably broken if we, as voters, allow ourselves to be so distracted and blinded by our current partisan Spy vs. Spy intrigue, that we do not pay attention to the erosion of our own power as informed, rational consumers and voters in this capitalist democracy. The only group in the country empowered by the Constitution to truly fix our damaged systems is YOU. Only we, the people can be trusted to use our dollars and our votes to properly restore what is wrong today. It’s complicated, but here’s what’s happening:

Our democratic freedoms and our economic freedoms are deeply intertwined. New Hampshire citizens’ participation and voting during Town Meeting might be as pure an example of democracy as you are likely to find in the United States. When we envision our purest economic freedom, we might imagine a rosy picture of mid-20th century free enterprise, featuring small business, laissez-faire capitalism, and corporations responsible to (and paying dividends to) their shareholders. But capitalism has undergone subtle changes in the 21st century, and “good old free enterprise” is suffering from a terrible parasite. And it’s probably not what you think, or what they tell you on the news…

Nationally, our economy has moved away from being dominated by small-business free enterprise. Some would have us believe that immigrants threaten our way of life, or that we are being driven toward “economic socialism”, which the dictionary defines as a system in which the public collectively and equally owns the means of production. An astute observer will see that neither of those are true. The United States is certainly not moving toward “state socialism” either, in which the state owns the means of production, as in China where the government unequivocally owns all factories, news agencies, and power plants. In spite of much of the rhetoric you hear, clear evidence suggests we are headed toward a “plutocratic oligarchy”, in which the very wealthiest essentially own the state, as well as everything in it. Today, the top 1 percent has more wealth than 90 percent of the American population combined (If you would like to study well-documented evidence of this, you can examine an extensive Wikipage entitled “Wealth Inequality in the United States” and follow the links back to the sources of the information presented there.).

In a recent radio interview I heard, Yancey Strickler and Andy Ballester, founders of the crowdfunding charity websites Kickstartr and GoFundMe, talked about the ongoing consolidation of our nation’s financial wealth into the hands of a few. Strickler spoke about our “mullet economy” (named for the ‘80s hairdo) that’s “all business out front”, for 90 percent of us who are struggling to make it in this economy, “and a party out back” for the 1 percent belonging to the billionaire CEO class. They are buying out stockholders, riding high on the booming economy, skimming profits through outsized CEO compensation and influencing policymakers in government to make even further consolidations of wealth possible. We live in an age where “the super-rich think that the only purpose of money is to make more money,” says Ballester, rather than to contribute to a “conscience economy”, where money is spent to help people and the communities we live in. This is the parasite that draws dragging us down.

How did we get into this situation, and how do we get out of it?

In the century from the Civil War to the Cold War, monopolistic companies (19th century railroads were a famous example) cleared the table of their competitive opposition and gained sole control of entire markets. Antitrust laws came into being to curtail these “horizontal” monopolies that could win the game because they were the only player left on the entire tabletop. Many of the captains of these industries and their heirs nevertheless felt they had an obligation to use their immense wealth and power to improve society in some way. Their old concept was called “noblesse oblige”. The Mellons, Rockefellers, and Carnegies endowed universities, libraries, and the arts. Two wealthy scions of only slightly less prominent families, Hamilton Fish and Gifford Pinchot, took it beyond sharing just their monetary wealth, by also sharing the wealth of their time and energy. They demonstrated their commitment to repaying society for their great good fortune by entering public service as young men. In their lives, they became modestly famous doing such beneficial things as serving their country in the military, serving as United States Secretary of State, cabinet members, and as popular state Governors, negotiating important treaties with foriegn powers, embarking on major domestic projects such as paving public roads for the first time, and creating the United States Forestry Service. They believed that workers needed to earn a living wage, because helping workers would help all of society. Where are such public-spirited wealthy people today?

Since the Cold War, we have seen a different kind of monopolistic behavior unfold. Rather than eliminating all competitors “horizontally” to control the tabletop as the old-time railroad barons did, we have seen the recent emergence of “vertical” monopolies like today’s large petroleum and lumber corporations, who own every part of their retail chain, from mining or harvesting a raw resource, to supplying all the retailers within their territories with refined finished products, such as unleaded gas to competing gas stations, and plywood sheathing to all the building supply outlets. Once again, the vertical monopolist gains sole control of an entire market, but has done it in a way unrecognized by current antitrust laws.

Two modern developments make this especially problematic:

First, vertically integrated corporations contain their own internal trading departments that write contracts for future purchases and sales, which is a bit like betting in a card game where you always get to shuffle and stack the deck. This means a big vertically integrated company can predict or even create shortages and surpluses, thus influencing the price of their commodities, even if they are not the only supplier on the tabletop. (Remember OPEC? Saudi Arabia still controls the world’s crude oil prices, even though there are lots of other oil producing nations. This is a key part of the creepy United States-Saudi alliance.)

Second, since the year 2003, many publicly traded stockholder corporations have been “taken private”. Controlling stock is now owned by an individual and his immediate family through “stock buybacks”. Some of these super-wealthy folks have demonstrated they feel no responsibility to the public good, nor to the remaining minor shareholders (to whom they pay little or no dividends), nor to any disempowered board of directors, nor even to their employees. Some deem their employees “subcontractors”, who then work for them without insurance or benefits. The private owners of these vertical monopolies do have a strong ability to influence government through hiring lawyers and lobbyists. If those efforts don’t succeed to shape government policy or avoid legal reprisals, they move themselves or their wealth to a different jurisdiction and declare bankruptcy (Have you been following the story of the Sackler family, who owns opioid manufacturer Purdue Pharma? Or heard of the book “Kochland” by Christopher Leonard?). This behavior is not an example of what we used to hail as “American free enterprise.”

So, in today’s world, that’s what economic corruption looks like. What does political corruption of our democracy look like? As far as I’ve seen, there are no thick envelopes of cash being passed to legislators in State House hallways before votes. There are however too-cozy relations between lobbying organizations and office holders’ campaigns, which you can investigate yourself on the New Hampshire Secretary of State’s “Campaign Finance System” and “lobbyist’s income reports” websites. Corruption of our democracy can even look like legislators who take a hiatus from office to lobby for a commercial interest (in exchange for a huge salary), only to return to office just six months later – this is the proverbial “revolving door” cycle. For this scam to succeed, voters have to be duped into voting for these “double agents.”

This is where “dis-information” enters the picture. Corruption also takes the form of privately-financed “educational” institutes, out-of-state-financed bulk mail political ads, and broadcast or internet news feeds that decry all other channels as “fake news”. You should be skeptical of information provided to you “for free”, and find out who advertises or sponsors the political and news reporting you see. It costs money to produce all this stuff (This is a perfect place for a plug: Be sure to support the independence of your community newspaper by making your contribution to support your Andover Beacon today!).

Who pays money to make sure you see a story from their angle, and why? For example, did anyone else notice the announcement at the top of the program that big pharma sponsored the Democratic candidate debates, and that the first question from the moderator every time was always about health care issues, not the environment, not foreign policy, nor any other front-burner issue? The harder it is for you to find out who is actually paying to produce published information, the more suspicious you should be of that information. That’s why I cite verifiable sources in my columns, so you can check up on it yourself if you wish. In upcoming Report from Concord columns, I will describe the bills I’ve proposed that aim to reduce the types of corruption I’ve described here.

Through years of exposure to clever advertising, we consumers know how to be skeptical of repeated saturation ads that make “New! and Improved!” claims advertising the same old products. We should be equally wary of political and prejudicial opinions being pre-packaged and drummed into us through print, broadcast, and internet media. No matter how often they say it, we know a lie will never really become the truth, but they can get some folks to think it, the same way we catch ourselves humming an advertising jingle.

How do we get out of our current political logjam and restore an economy that works as well for regular folks like us, as well as it does the super-wealthy? Let’s start by listening to information carefully and considering its source. If I feel that I’m getting mad or emotional, I realize that somebody is probably trying to manipulate me. As a teacher, coach, dorm parent, and “professional adult”, I navigated a turbulent world full of teenage people (and their parents) for nearly four decades. I think I’ve experienced nearly every nuance of manipulation from every angle in human imagination! My advice is to just stop, cool down, and think about our common goals rationally and fairly. Will it still look fair if I put myself in the other guy’s shoes? When I apply this way of thinking to our local communities, I always vote to preserve local small-business capitalism, our supportive community, our most personal freedoms, and our democracy. I hope you think local small-business capitalism, our supportive community, our most personal freedoms, and our democracy are worth your best effort, too.

Pay attention to who is feeding you (dis)information in this upcoming election year, and discuss “who said what” with other citizens. Then be sure to vote!