America's poisonous monopoly economy
One of Trump's biggest lies is how "Mexico and China stole our jobs".
Mexico and China didn't steal our jobs.
They were given those jobs by the CEO's of America's companies.
I recall that back in the 70's politicians and pundits talked about economics and industry in terms of national security.
That stopped and was quickly forgotten under Reagan and neoliberalism.
So it is surprising to find this article in the American Conservative.
This story of lost American leadership and production is not unique. In fact, the destruction of America’s once vibrant military and commercial industrial capacity in many sectors has become the single biggest unacknowledged threat to our national security. Because of public policies focused on finance instead of production, the United States increasingly cannot produce or maintain vital systems upon which our economy, our military, and our allies rely. Huawei is just a particularly prominent example.
The erosion of much of the American industrial and defense industrial base proceeded like Lucent. First, in the 1980s and 1990s, Wall Street financiers focused on short-term profits, market power, and executive pay-outs over core competencies like research and production, often rolling an industry up into a monopoly producer. Then, in the 2000s, they offshored production to the lowest cost producer. This finance-centric approach opened the door to the Chinese government’s ability to strategically pick off industrial capacity by subsidizing its producers. Hand over cash to Wall Street, and China could get the American crown jewels.
The article focuses on the inability of the U.S. to manufacture its own weapon systems, and that is the most dramatic example.
What this country has lost goes far beyond that.
“The middle-class Americans who did the manufacturing work, all that capability, machine tools, knowledge, it just became worthless, driven by the stock price,” he said. “The national ability to produce is a national treasure. If you can’t produce you won’t consume, and you can’t defend yourself.”
The article then goes on to describe how the lust for oversized profits has translated into monopoly power.
It achieves these returns for its shareholders by buying up companies that are sole or single-source suppliers of obscure airplane parts that the government needs, and then increasing prices by as much as eight times the original amount. If the government balks at paying, TransDigm has no qualms daring the military to risk its mission and its crew by not buying the parts. The military, held hostage, often pays the ransom. TransDigm’s gross profit margins using this model to gouge the U.S. government are a robust 54.5 percent...
TransDigm was caught manipulating the parts market by the Department of Defense Inspector General in 2006, again in 2008, and finally again this year. It is currently facing yet another investigation by the Government Accountability Office.
Yet, Trandigm’s stock price thrives because Wall Street loves monopolies, regardless of who they are taking advantage of... It is no wonder our military capacities are ebbing, despite the large budget outlays—the money isn’t going to defense.
Probably the most interesting part of this article is that none of this is new.
n the 1920s and 1930s, the American defense industrial base was being similarly manipulated by domestic financiers for their own purposes, retarding innovation and damaging the nation’s ability to defend itself.
Back then the technology was the airplane, and the monopolists were being influenced by Nazi Germany.
And that's where the article ends.
Only looking at the defense industry and rival nations. It doesn't exam the fact that this is just one part of a multinational monopoly problem.
Just look at Monsanto.
Monsanto operated a “fusion center” to monitor and discredit journalists and activists, and targeted a reporter who wrote a critical book on the company, documents reveal. The agrochemical corporation also investigated the singer Neil Young and wrote an internal memo on his social media activity and music.
The records reviewed by the Guardian show Monsanto adopted a multi-pronged strategy to target Carey Gillam, a Reuters journalist who investigated the company’s weedkiller and its links to cancer. Monsanto, now owned by the German pharmaceutical corporation Bayer, also monitored a not-for-profit food research organization through its “intelligence fusion center”, a term that the FBI and other law enforcement agencies use for operations focused on surveillance and terrorism.