DIVIDE AND CONQUER
John Q. Pridger

March, 2004

Divide and conquer is the way to accomplish almost any perverse end. We're told that in order to get out of our present economic fix, all Americans need to do is export more to the rest of the world. In order to do that, American labor still has to be taken down a few more economic notches in order to be internationally competitive. The way this is being accomplished is by dividing the American producer from the American consumer. They were once one in the same person. American producers, in a mutually beneficial partnership with capital, produced for the American market and they also consumed most of their own production.

When the American producer and consumer were one in the same person, employed by "domestic" American capital, capital had an incentive to keep the wages of labor high. There was no such thing as a "jobless recovery." If Wall Street and the economy were booming, American labor was fully employed and doing well too. Only when the employees of capital are also the primary consumers of capital production can a broad-based prosperity be created. This is why the American industrial middle class developed as it did – and all other workers throughout the economy were drawn upward on the coat tails of industrial labor and the industrialized economy.

Divorce capital from labor and this critical partnership is broken. When capital employs labor to produce for export, there is no incentive for capital to keep the wages of labor high. The opposite becomes the case. Labor merely becomes another cost of production to be cut by any means available in order to increase profits. Since labor is not also the customer, capital could care less whether labor gains the wherewithal to maintain any particular standard of living.

This is why an export economy is no replacement for an economy that produces primarily for domestic consumption. Yet none of the "experts" are pointing this out to the American people. In fact, all the experts are vigorously pushing the opposite message.

There's another down-side. Rich countries that seek to export into poorer markets have to price those exports to sell in those poorer markets. It ought to be readily apparent that this can result in nothing less than a race to the floor. But what economist is pointing this out to the American people? What politician is pointing it out? None!

Almost all of the poor, under developed, nations (including former colonies), no matter how rich in natural resources, have been export-based economies – where the consumers of their production are always "other people elsewhere." Keeping domestic wages low has always been part of their national economic policy in order to attract foreign investment and take profits.

Usually Third World nations are so overburdened with debt (which is always gladly accepted when the rulers get their part of the action), that once the international banks, the corporate business owners, and grasping local politicians are paid, there is precious little left for labor. In typical Third World nations these circumstance and processes are institutionalized, and aren't changing as the New World Order bull rushes in to finish goring its hapless benefactors – they remain peon labor, little better off than slaves or serfs.

Third World nations that developed from former colonies and had plantation economies developed to supply and serve the mother country. Little has changed. They are still plantation economies, but they are going industrial and high tech. But all else remains the same, because most of the wealth they produce is for export to others, elsewhere. This system is just as institutionalized today as when they were colonial "possessions." The only difference now is that multi-national corporations, with the help of the World Bank and IMF, run the show rather than "mother countries."

Pre-Civil War America provides an excellent example of a nation regionally divided between two distinct economic systems. The North had a vigorous agricultural and industrialized economy, and it protected its market. The South had an export-based plantation economy. Cotton was the major export, and cheap labor was institutionalized in the form of chattel slavery.

The South needed "free trade" in order to sell cotton abroad and prosper. The North needed "protectionism" in order to prosper and keep its money and products at home. Naturally, the two could not co-exist as one nation, and the Civil War finally resulted. The North was getting something fundamentally right, and the South was locked into a system that was fundamentally wrong and economically flawed. The North won, of course.

This American North-South divide was not all that much different from the present global North-South divide that the international brain trust has successfully exploited in bringing on the New World Order. But in the present case, the North is being required to mortgage itself to the South to bring equity to the global economy. This certainly isn't getting it right – certainly not for us in the North – yet our leaders have followed their dictates, and the rest of the world is apparently eager to follow in our footsteps.

Pushing toward making America into an export-based economy is like moving the nation back toward what the South was before the Civil War, and what many nations were under the yoke of colonialism, and continue under (but now the yoke is the yoke of international capital). That's why so many of us have for so long referred to the New World Order as the Global Plantation. The Global Plantation may now be going industrial and high tech, but it is still the same animal in every important respect.

The plantation owner is no longer either the people nor the rulers of any nation – it's a cabal of international capital interests. The people have been blinded and hoodwinked, and the rulers paid off. Our overseers are an array of global corporations, and "We the People" are the serfs, peasants, peons, and slaves. Our governments now merely function as the overseer's controlling "police power," charged with fashioning, and controlling, a docile international corporate work force. The means of control are all nature of coercion, from educational indoctrination, taxation without true representation, macro and micro-regulation (of people, but not capital), welfare and other subsidies, providing "golden parachutes," to threat of fines, penalties, prosecution, and actual lengthy incarceration.

When we hear that free markets rules, we should also consider who rules the markets and who or what benefits. Of course, we've swallowed all the bait, as intended – hook, line, and sinker. And the reason that we have swallowed it is that we are so well and successfully propagandized, still considerably over-fed, and have plenty of cake and circuses (not to mention wars), to divert our attention.

Is any of this the result of any real altruism or any genuine desire for global peace and prosperity? Or is it about "control" and locking in perpetual profits for international corporate interests? You be the judge.

HIGH GAS PRICES A CAMPAIGN ISSUE
October 2004

Well, gasoline prices are once again at an all time high, and the major presidential challenger is pointing the finger of blame at the incumbent administration. Meanwhile, the incumbent administration is attempting to appear to be "doing something" while denigrating the challenger's accusations and proposals.

Of course, it is always stylish to blame the Arabs, OPEC, oil companies, and the incumbent administration for spikes, and ever-higher plateaus, in the price of crude oil and domestic energy supplies.

A few politicians are once again talking about the need for energy independence. Some energy "experts" use such occasions to resurrect the nuclear power genie as the only viable, long-term, alternative to fossil fuels for domestic power production.

But just who is responsible for our present dependence on foreign sources for oil? Has some Arabic enemy pushed us into our present and growingly vulnerable strategic and economic position? (Was it Osama bin Laden and al Qaeda?) No, it's our voracious and increasing appetite for oil. As in the case of our present dependence on China for a large and growing amount of our consumer goods, "We have met the enemy and the enemy is us." (To quote Pogo, or somebody) We have not only nationally continued to go down the road of more than just "conspicuous consumption" – as a nation we have absolutely refused to live within our financial or energy resource means for half a century.

Rather than trying to become energy independent, and thereby showing the rest of the world how to conserve their own resources, we've gone the extra mile to become even more dependent in every significant thing. We've prepared a bath called total international interdependence and then jumped into that bath like a hog easing into a mud wallow from a five foot diving board. Now we wonder why we seem to be unable to shake the mud off.

Ironically, China, which is now a MAJOR "producer" of American consumer products (thanks to the Washington Brain Trust), is also becoming another voracious consumer of energy, and a major competitor for global energy supplies. This growing competition is a significant and growing part of the story of increasing oil prices in international markets and increasing gasoline prices at American gas pumps. Our mis-representatives in Washington have shot us in the foot so many times that we've forgotten what it means to walk upright on two feet. We walk on crutches and think we're the ablest and freest people in the world.

When relatively cheap, fuel-efficient, Japanese cars first began entering the American markets in the early sixties, the energy crunch handwriting was already on the wall. America was becoming far too dependent on petroleum bases fuels and, more importantly, on imported crude oil. America was no longer fuel and energy independent, and this creeping dependency should have been a major wake-up call and leading economic indicator. Then came the big Oil Embargo of 1973, which (among other things), was the result of our support for Israel in the 1973 Arab-Israeli War.

For the first time in our history there were long panicky lines at gas pumps, and Americans were rudely awakened to the fact that America was becoming dangerously dependent on hostile alien sources for one of its most important energy resources. If common sense had ruled, we would have regained energy independence within two decades even if it meant putting half the nation back on horses or bicycles, or into ultra-light horseless carriages fueled by methane gas generated in Washington by the bottomless pit of the Brain Trust.

It would have been relatively easy to have remained energy independent, or regained it once we noticed that domestic oil resources couldn't satisfied the market. The major obstacle was the fact that short-sighted economic experts, national policy makers, and profit hungry industrialists and multinational corporations, had been busy for half a century making it a necessity for everybody to have to drive two tons of rubber, glass, and steel everywhere they went. Basic economics courses should have stressed too things before getting into the finer scientific points and profound statistical analysis, i.e., "Live within means," and "Plan ahead."

Actually, our "experts" did plan ahead, but with the faulty and arrogant assumption that American capital would always have easy and cheap access to everybody else's natural resources. In addition to this, most economists, as well as the schools that train them, are on corporate payrolls. So we launched ourselves into the world as a post World War II superpower, eager not only to show the world how much of its resources we could consume, but teach the rest of the world just how to consume just as much as we do.

In the early 70's the automotive industry, both here and abroad, had been engineering cars to cruise comfortably at 85 MPH for some years. We were just completing our new Interstate Highway System (as national defense project), engineered to make such speeds relatively safe. Automotive America was really taking off! But a national speed limit of 55 MPH was passed as a fuel saving measure – a speed that seemed tediously slow in late model cars on the new highway system. Nobody liked it, of course, but, amazingly, a lot of people actually kept their speed down to the new limit as a patriotic gesture. The national motto became "Stay alive! Drive 55!"

At the same time, the best continental and short-run railroad track and rolling stock infrastructure the world had ever known was being neglected and allowed to fall into disuse and ruin, along with local mass transit systems in most sizable metropolitan areas.

When Jimmy Carter gained the presidency in 1977 the oil crises and inflation were still huge problems. He began to initiate some positive programs toward national energy independence through alternative energy sources. For example, it became easy for individuals to get licenses to construct experimental alcohol fuel distilleries. Solar, thermal, wind, bio diesel, and other types of alternative energy research and production were also given special treatment, encouraging development by individual entrepreneurs and small business concerns. But this first serious official push toward domestic energy independence was to be short lived. Gas prices came down somewhat and Americans became convinced that the oil shortage had been contrived – the world was still floating on cheap oil.

Meanwhile, as foreign imports pressed the issue, American automakers made great strides in improving the fuel efficiency of their cars. Compact, sub-compact, and mid-sized cars became more and more numerous on the nation's highways. Even the traditional, full-sized, American luxury car became much more fuel efficient. This, together with the combined power of the the auto and oil industries, continued to keep the nation increasingly dependent on automotive solutions and imported oil. With America becoming evermore dependent on foreign oil imports, international oil brokerage became as important to global oil companies as oil production itself. This, especially after many foreign oil fields had been nationalized (some time before), reducing the profits gained through strictly productive activities. The international oil trade became one of the world's biggest businesses, and for some time our only real serious trade imbalances were in the international crude oil trade.

Many other things were going on, too, to make sure the American public was increasingly hooked on their automobiles. Ironically, the massive deconstruction and reconstruction of our cities, that resulted in part from forced integration, played a significant role. Urban blight was followed by Urban Renewal, just as the Interstate Highway System was significantly changing both urban and rural landscapes. Great swaths of city centers and suburbs were sliced up and isolated by new high speed, limited access, highways. Small towns and communities were being written off of the beaten path. Travel patterns and requirements were radically changed. Ease of automotive travel was an integral part of Urban renewal and national economic planning.

White flight sucked the life and industry out of the inner cities, and made them into dangerous enclaves that not even Urban renewal could hope to remedy, cities were literally chopped up. Large corporations and business concerns saw a new rainbow of opportunities in the remaking, and the suburban malls, shopping centers, and fast food restaurants began filling an increasing need for people who no longer wanted to risk going down town to shop. It was becoming necessary for almost everybody to own a car. Literally everything was being laid out for the convenience of motorists, rather than for pedestrians or those who used urban mass transit systems. To enjoy the American dream, the automobile had become a vital necessity for urban man. Most city mass transit companies began losing their passengers, and could no longer make a profit. Many small and intermediate cities completely lost their mass transit systems.

The same things were happening in smaller cities and communities. The commute to work or mall, or even the "local store" became almost an impossibility without "wheels." And city life was becoming so devoid of "community life" of any kind, that frequent excursions out and away from the maddening traffic jams became a requirement for anything resembling a quality lifestyle. This reformation of American cities and countryside had some good repercussions. It probably saved American car makers from the increasing onslaught of foreign competition. But it also insured that Americans would continue to be increasingly dependent upon, and wed to their personal automobiles for transportation; and, needless to say, increasingly dependent on imported foreign oil. We ended up with cities and a nation that had been redesigned and rebuilt with the personal automobile in mind, making it a necessity for all time. This was not the road to energy independence.

When Reagan was elected to the White House, big oil and international capital also gained office. The new international economic order was on the way. The special experimental alternative energy programs designed for individuals and small business concerns began to run out and were not being renewed. Most small alternative energy companies went under. Gas prices had found a plateau and subsidies for alternative energy research ended. Once again, the big boys enjoyed exclusive favor, and the biggest boys were committed to petroleum based fuels, at least until such time as they could gain a monopoly position in any of the potentially viable alternative energy industries.

The Reagan administration, unfortunately (an in spite of his conservative base), became the instrument of wholesale globalization – to be accomplished through deregulation of business and the Yellow Brick Road of free trade. Many conservatives had been seduced and snowed by the "free market" economists, and the Republican party was about to adopt the internationalism promoted by the neo-conservatives who were to offer the nation an alternate "compassionate conservative" option.

President Reagan introduced us to the "new international economic order" and made it the cornerstone of American economic policy. Where did he get that idea? Was the New World Order really an American policy initiative?

"...It is increasingly clear... that a new international economic order is essential if the relations between rich and poor nations are to be transformed into a mutually beneficial partnership..." (Kurt Waldheim, 1975)

"...the Sixth Special Session of the United Nations General Assembly (was) held in April and May 1974, following initiatives taken by Algeria and supported by the Group of Non-Aligned countries. The session culminated in the adoption of two important resolutions: the first expressing the collective desire of member states to work towards the 'Establishment of a New International Economic Order'...the present system of relationships between nations fails to serve the common interests of mankind as a whole and that only through the establishment of a new international order can existing injustices be rectified and the basis established for a more just and peaceful world." (The Aims and Scope of the Report "Reshaping the International Order – a Report to the Club of Rome," 1976)

President George H. W. Bush introduced the "New World Order" as his own phrase to describe the new international economic order, and grandly proclaimed it to be the continuing cornerstone of American foreign and economic policy. Where did he get that idea?

It had been around for a long time – since the great One World conspiracy, in its varied and metamorphosing forms, began. The motto "Novus Ordo Seclorum" was emblazoned and enshrined on the reverse of the Great Seal of the United States of America before the Constitution was written and ratified. That, to some, translates to "New World Order" rather than "New Secular Order" or "New Order of the Ages." And a New World Order was at the very core of the League of Nations as well as the international communist agenda. And the United Nations inherited or adopted both the term and the mission from those former organizations and movements. Conspiracy theorists had been thoroughly familiar with those very words long before President Bush pulled them out of the closet.

"In international flora, Soviet spokesmen have continually argued that the new world order should in fact represent indemnification for former colonial exploitation and that since the centrally planned countries have not participated in this exploitation, it cannot be expected that they should share in the compensation... Chinese spokesmen have reiterated the indemnification argument...(motivating) Peking's lack of enthusiasm for current attempts to shape a new world order. It originates in the all too familiar theses of China: 'The current international situation is excellent, there is great disorder under heaven'." (The Position of the Centrally Planned Nations "Reshaping the International Order – a Report to the Club of Rome," 1976)

We learn from the same document that in 1973, "...(OPEC) took the initiative to use their power and raised the price of crude oil... to about four times the previous level. This development, facilitated by a temporary and perhaps unexpected coincidence of interests between Western oil companies and OPEC nations, caused the industrialized countries considerable distress... (and resulted) in a temporary two per cent transfer of the GNP of the industrialized countries to the OPEC nations; it also contributed towards accelerating recession in economic activity which had started in 1972... Economists struggled to explain 'stagflation', the unique combination of high inflation and industrial recession; Keynesian economics, which had helped to steer courses away from impending crises in the past, this time seemed perilously inadequate... seventeen million people flooded the employment offices of the richest countries... Prosperity has brought anxiety to the Western World, a gnawing fear that the good times might well be over, even though aspirations for still greater material benefits remain. If the Western world is to come to grips with this, with its growing list of problems – social as well as economic – it must, in its own long term interests, seek to create new international structures based upon global cooperation."

The 1973 oil crises was then an instance of the OPEC countries "taking the initiative," to get things straight between the exploited and the traditional exploiters once and for all, and they did it with the collusion or tacit approval of Western oil companies that also stood to gain. This was but one of the opening salvos of the New World Order to be announced almost twenty years later by a Republican president.

The the pressures that came to bear on our national leadership, which forced a recently independent America to seek "solutions" in dependence and subservience in a globalized world are starkly revealed. We lost mastery over our national destiny by making the "new international economic order" the dream of a changing breed of American leadership.

The problem, as perceived in 1975, was that North America, with only 6.1% of the world's population, had a 30% share of the global GNP, while Asia (excluding Japan), with 52.7% of the global population, only had 10.2% of the global GNP. This disparity in the distribution of wealth was "officially" determined to be the legacy of colonial exploitation.

Thirty years later North America still has about 6% of the world's population and 30% of the global GNP. The U.S. share is 5% of the population and 27% of the global GNP. The major change that globalization has brought within the United States during those 30 years has been a growing economic divide between rich and poor, along with a growing dependence on the rest of the world for its continued prosperity. In wealth distribution, the U.S. is now beginning to look like the traditional Third World nation .

Some of the rest of the impoverished world is coming up in terms of wealth too, though "the peoples" themselves seldom enjoy much of the wealth. China, for example, has experienced more economic growth, both real and artificial, in recent years than any other nation. This economic miracle can be largely attributed to America's willingness to invest in China and open its markets to Chinese production.

There is another way to look at it, however, and apparently nobody has thought to look at it that way yet. Prior to their colonial conquests, the European nations of the day were already well "advanced" compared to most of the rest of the world. There was no concept of GNP yet, but European nations certainly had more than their share of developed wealth. And 90% of the world's population was as just as impoverished, and often much more enslaved, than it has been since the most predatory and exploitive period of the colonial era.

Here's an interesting thing to ponder. Just try to figure out what the world would be like today had the Europeans stayed home and minded their own business!

For one thing, North America would still be a "virgin" continent full of stone-age native tribes warring among themselves, and so would Africa. Europe probably wouldn't have advanced as far as they have. But, chances are, they'd still be periodically battering each other with machine guns, bombs, tanks, and mustard gas.

The United States of America, which had become the most successful and prosperous nation in the world, unlike the European colonial powers, had never tied its national economic destiny to global colonial exploitation. America's belated ventures into colonial and economic imperialism, in fact, actually helped to cripple it economically and render it much less independent than its own political institutions and raw material resources had endowed it.

America's 30% share of the the GNP of the world was largely the result of American industry and innovation. True, America was already gaining a voracious appetite for raw materials from foreign sources (especially oil), this was largely because long-term planning was being done by the short-term minds of short-sighted people.

Apparently the program was that, if we had no option but to become increasingly dependent on foreign oil, we might just as well become dependent on foreign suppliers for a lot of other things too. There were big profits to be made by American businesses if they could be cut loose from the domestic labor market while still retaining favored access to the domestic consumer markets. The international wage differential game was a great rainbow of opportunity awaiting American capital in the guise of international "free market economics." The neo-conservatives of the the "new" Republican party loved the idea, and so did the bleeding heart internationalists of the liberal wing of the Democratic party.

Both true conservatives and true liberals were fooled for an amazingly, and embarrassingly, long time. The New World Order has indeed been a bi-partisan creation, while the silent majority (of whatever political stripe it might be), slept on overstuffed bellies and remained more than adequately entertained while it was having its economic legs knocked out from under it.

Now that we're at war with terrorism, and the Arab oil producing nations, as well as having most of the rest of the world are increasingly hostile to us, and gas prices are at record highs, the topic of energy independence has reemerged in the Democratic presidential primaries.

There probably isn't one American in ten thousand who doesn't believe that we have both the resources and technological ability to make ourselves energy independent, if we only had the political will. But how can we have the political will after the public has become convinced that all the former oil crises were actually fraudulent and artificial? How can we convince the families that have to have two or three cars so everybody in the family can make it to work, or down to the mall, that we have been living beyond our means when it comes to tons of steel and gallons of gasoline required to support what has become the American way of life?

We all know that we can do it – but nobody really wants to have to pay the piper. Paying the piper means doing more with less – ultimately, much less. The gas-guzzling SUV hasn't become the most coveted American status symbol over night. It took years, not only to convince the American people that the world is floating on untapped oil, and that we Americans have the right to it no matter whose land it happens to be under, but to make them confident in a future of plenty again. Now, after all, could it be that we really do need to tighten our belts? Not many are buying it – yet.

The New World Order (the American perspective, at least) promised that oil would not only be available, but that money is no object in satisfying the American appetite for "cheap oil" and "cheap consumer goods." It matters not how expensive it really is – as long as the true prices are not reflected at the gas pump or Wall Mart counter. Let the price show up on April 15th or in the staggering level of the national debt – but not at the pump or checkout counter.

John Q. Pridger