America is now a Plutocracy

How the corporatocracy is destroying America

"…unemployment, which in all cases is an evil, and which, when it reaches a certain level, can become a social disaster."

Pope John Paul II

“Labor is the store of all value.”

E. Michael Jones

“We show that poor local labor market conditions are associated with higher mortality risk for working-aged men and, specifically, that a one percentage point increase in the unemployment rate increases their probability of dying within one year of baseline by 6%.”

Unemployment and mortality: evidence from the PSID

“Capitalism is state sponsored usuary.”

Girolamo Savonarola

“The main criteria for judging the worth of any economic system is its treatment of labor…”

E. Michael Jones

“When you see that in order to produce, you need to obtain permission from men who produce nothing.

When you see that money is flowing to those who deal, not in goods, but in favors.

When you see that men get richer by graft and by pull than by work, and your laws don’t protect you against them, but protect them against you.

When you see corruption being rewarded and honesty becoming a self-sacrifice, you may know that your society is doomed.”

Ayn Rand, Atlas Shrugged

“Keep in mind, the news media are not independent; they are a sort of bulletin board and public relations firm for the ruling class-the people who run things.

Those who decide what news you will or will not hear are paid by, and tolerated purely at the whim of, those who hold economic power.

If the parent corporation doesn't want you to know something, it won't be on the news.

Period.

Or, at the very least, it will be slanted to suit them, and then rarely followed up.”

George Carlin

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I am not a writer or a journalist or an economist, however over the past 40 years I have seen some very troubling patterns emerge regarding how the working class is treated in my country and I feel it is my responsibility to tell you about them.

At the time of writing this, I am an unemployed IT professional.

Information technology is my second career as I went back to school in the early 90s to get a better career or at least one that paid the bills.

My first career did not.

After graduating from a university in the south in 2000, I took a job with a software services company in the Raleigh-Durham NC area.

A little over a year later 911 happened.

When the dot com bubble burst and the IT job market bottomed out, that left me unemployed for about a year-and-a-half.

I ended up moving back home into my parents basement in Pittsburgh and going back to work in a pizza shop where I worked in my twenties.

This was a humbling experience.

Finally getting back to work on Labor Day of 2003, I’ve been able to remain employed since however, I’ve recently lost my job again this past July as a result of a reduction in workforce after a Fortune 100 multi-national corporation bought the company that I’d been working at for almost 20 years.

Then came the layoffs.

They began terminating people in small tranches in order to keep from filing notifications with the state I live in.

Based on personal experience and what I’ve witnessed over the past 40 years regarding the treatment of labor in America or better yet, how our representative government, whose job it is to protect its citizenry from corporate greed and its reprehensible treatment of American workers, it’s become apparent that the same government is no longer representative of the people but instead represents corporate interests.

America is now a Plutocracy.

With the infiltration of H1B visa holders and the offshoring of high-tech jobs, the high-paying information technology jobs that Americans were told would replace the blue-collar manufacturing jobs lost in the 70s, 80s and 90s are now facing the same fate as those American manufacturing jobs did decades ago.

The question that most people do not ask (or are afraid to ask) is: How did we get here and what are the economic forces at play that impact labor negatively in America? 

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American Steel – Deregulation, Disinvestment, Demoralization, Disintegration

The American steel industry began in the Pittsburgh area in late 19^th century and at its peak, produced over 70% of the world’s steel and employed over 90,000 workers in Pittsburgh and in the surrounding areas in the American Rust Belt.

The United States Steel Homestead works, the largest mill in the Pittsburgh area, manufactured much of the steel that was used in the American infrastructure in the twentieth century. Steel for American railroads, the Verrazano Narrows and George Washington bridges in New York City, as well as steel beams for the Empire State Building and Rockefeller Center were forged in Homestead.

Today on the site of what was once was United States Steel Homestead Works sits a shopping center and cineplex, a metaphor of what America has become: A hollowed-out shopping mall and entertainment industrial complex filled vapid and insipid consumers with little or no understanding of history or what deindustrialization and the war on American labor has done to this country. 

The only reminders that the Homestead Works was one of the largest open hearth steel mills in America that employed 15,000 employees existed here are the vestigial smokestacks that used to vent heat from the manufactured steel ingots at the mill. They now sit next to a Longhorn Steakhouse near the end of a mall parking lot.

Ironically, when the United States Steel Corporation (USX) was dropped from the Dow Jones Industrial Average in 1991 it was replaced by the Disney Corporation.

More evidence of the Disneyfication of America and our insatiable appetite for distraction.

I was living in Pittsburgh and was in my early twenties when the steel industry collapsed and remember how profound the impacts were to this part of the country. At the time, they were described as being on par with The Great Depression.

It was bad.

Generations of families worked in the mills in Homestead, McKeesport, Southside, Duquesne, Hazelwood, and Clairton and overnight it seemed that it all shut down.

Home foreclosures and sheriff sales were common-place and families fell apart. Food pantries were created to deal with the problems of mass numbers of unemployed steelworkers trying to feed their families. Alcoholism and drug abuse were rampant.

Suicides in the boroughs of McKeesport, Duquesne, Clairton and where US Steel employed thousands of workers, were more than double the national average.

Little historical information is available about these places that were of such significant importance to the American economy and sadly most Americans don’t seem to care.  Google and YouTube search results seem to either be lacking or they simply buried any results in their search algorithms.

Causes for the collapse of the steel industry are boilerplate narratives parroted from business schools, finance analysts, economists, and the news media talking heads: Poor management, union leadership problems, union greed, and cheaper foreign steel are some of the reasons given.

A thesis that I have not seen widely addressed as a reason for the collapse of the steel industry in America is that this is what the oligarchs wanted: The destruction of American manufacturing infrastructure and the American middle-class in the search for cheaper non-domestic labor.

Disinvestment is defined as withdrawal of capital investment from a company or country. I first came across this term when reading the book “The Deindustrialization of America” by Barry Bluestone and Bennet Harrison. By failing to modernize the aging manufacturing infrastructure in the steel and manufacturing industries, along with the weakening of the labor unions, management and the oligarchs began their plan to deindustrialize America and wipe-out middle-class America with the help of the American tax code.

In 1980 the U. S. Steel Corporation called a press conference “to announce that it would permanently close down fourteen mills in eight states (principally in Pennsylvania and Ohio) within the year, thus laying off over 13,000 workers.” This included a tax incentive from the IRS in the form of “an $850 million tax break from the federal government”.

With the tax break, US Steel later used the money for a down payment on the purchase of Marathon Oil.

At the time U. S. Steel had the money to rebuild and modernize manufacturing facilities but instead chose to pay “$6 billion to acquire Marathon Oil of Ohio”.

U. S. Steel's Chairman of the Board David M. Roderick lied and said that the acquisition of Marathon Oil “would in no way diminish their commitment to their steel operations.” but by that time the writing was on the wall.

The fact that the mainstream news media failed to raise these questions clearly showed that the Fourth Estate and the institution of journalism that was originally designed to act as a mechanism to inform and protect the public from the rapacious behavior of corporations and to hold government and the oligarchy accountable were by then on the side of the corporatocracy.

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Reagan and the High-Tech Bait and Switch

During his 1980 campaign Reagan courted the Pittsburgh blue-collar vote and they were key to Reagan’s victory, however after witnessing Reagan’s firing of 11,345 striking air traffic controllers (PATCO) on August 5, 1981, Pittsburgh voters realized they had been lied to again by another politician willing to say anything and sell his soul to get elected. 

When Reagan visited Pittsburgh on April 6 of 1983, unemployment in the area due to the massive layoffs of union jobs in the steel industry was at 16.2% down from 17%.

To say that Pittsburgh was not Reagan country is an understatement and upwards of 4,000 people demonstrated his Pittsburgh visit. Some held signs from the United Steel Workers union as well as signs saying, "Feed the Hungry, Not the Pentagon," and "This is not Reagan country, 17.2 percent unemployed in western Pennsylvania."

What was Reagan’s message to unemployed steelworkers during his visit?

That America was now in a transitional phase from a manufacturing-based economy to a high-tech, service-based economy and that displaced steelworkers needed to train for the coming high-tech economy that will be creating high-paying jobs.

To drive his point home, Reagan visited Control Data Institute, a two-year trade school located in the basement of the Allegheny Center Mall on Pittsburgh’s Northside where many displaced steel workers were attending classes to help them make this transition.

I was there.

My girlfriend at the time and I walked across the Sixth Street Bridge from downtown to catch a glimpse of the president however we were unable to get close enough due to the tight security associated with the assassination attempt on Reagan by John Hinckley two years earlier on March 30, 1981.

(As an interesting aside, the person that attempted the assassination of Reagan was John Hinckley, a family friend of then Vice President George H. W. Bush’s son Neil. Hinckley’s older brother Scott was invited to Neil Bush’s house for dinner that week, however cancelled after the assassination attempt.)

In the 1970s there were over twenty mills producing steel in Western Pennsylvania.

Today there are three.

In November of 2023 US Steel laid off 100 IT workers at their Southside offices.

One month later US Steel, once a backbone of the American economy, was sold to Japan’s Nippon Steel.

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Pittsburgh’s Transition to High Tech

Unlike places like Youngstown Ohio, Gary Indiana or even areas local to Pittsburgh like Swissvale, Rankin, McKeesport, Duquesne, and Homestead, Pittsburgh was able to make the transition to the high-tech economy.

What was so special that helped Pittsburgh make this transition while places like Youngstown, Gary and McKeesport continued their slide into crime, poverty, and obscurity?

In 1985 after being ousted from Apple Computer, the high-tech-wunderkind-sociopath Steve Jobs, started a new company called NeXT computer which focused on the academic computing market and opened an office in Pittsburgh, however prior to this had made several other trips to the Pittsburgh area in early 80s.

What was the draw to Pittsburgh?

Carnegie-Mellon University, one of the top computer science universities in the country is in the Oakland section of Pittsburgh, and while not widely known then or now, Jobs formed a close relationship with their computer science department in the early 1980s.

When Jobs needed help designing the Mach operating system for his new NeXT workstation, he enlisted the help of the CMU who Jobs esteemed as having “the best software design education in the country” and when Jobs was hired back at Apple in 1997, the Mach operating system was bought by Apple and evolved into the MacOS and IOS operating systems.  Tim Berners-Lee also wrote the first web browser and server software on a NeXT box which he claimed was instrumental in the development of the World Wide Web.

Today, Google, Apple, Facebook, Amazon, and Uber all have offices in Pittsburgh, and this is just a guess, but I suspect this is to allow them to siphon off the university’s comp-sci and robotics program grads.

When Reagan was extolling the virtues of a high-tech education after the steel industry collapsed My dad used to tell me “…not everyone can go to college, son…”  especially one like Carnegie-Mellon University where a four-year degree for a non-resident can now cost you upwards of $340,000, a high barrier for entry into the job market, and that’s if can you get in. 

My dad was right.

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The Giant Sucking Sound – NAFTA/GATT and Ross Perot’s Warning to America

The hemorrhaging of American jobs continued in the 90’s with the passage of NAFTA and GATT.

Ross Perot, the Texas businessman who started Electronic Data Systems and Perot Systems and who was also an investor in Jobs’ NeXT computer company, ran as an independent candidate in the 1992 United States Presidential election.  During a debate on the North American Free Trade Agreement with then Vice President Al Gore on Larry King Live, Perot intimated that the majority of the trade deals being passed through lobbyist influence were destroying the American middle-class and if NAFTA was passed, it would allow American businesses to move any remaining manufacturing south of the border to escape overhead such as retirement and health care benefits and at the same time pay workers south of the border a fraction of American wages. 

This he described as a “Giant Sucking Sound” referring to American jobs going south of the border due to the wage and benefit differential between the United States and Mexico. Perot’s anti-NAFTA rhetoric seems to have made some powerful people angry since in November of 1993 he said that he has “been targeted for assassination by a ‘Mafia-like’ group working to pass the North American Free Trade Agreement”.

Bill Clinton, who championed NAFTA as being beneficial to American Workers, signed the trade agreement into law on December 8, 1993, the agreement went into effect on January 1, 1994, and the trend of deindustrialization, job losses and the destruction of the American middle class continued.

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Christendom’s Influence on Economics

In Barren Metal: A History of Capitalism as the Conflict between Labor and Usury, Dr. E. Michael Jones describes the gradual slide away from the influence Christendom once had on economics and society and began the slide toward a money economy and capitalism which began in the middle-ages in Florence Italy with the Medici Family in the 15^th century.

As The Moral Law gave way, the restrictions against usuary, which was considered a mortal sin and forbidden by the Church, began to loosen and humanity saw a reversion back to pagan economics away from Thomistic economic philosophy. The organically developed, communal relationships that Christendom produced gave way to the “restlessness, selfishness, and self-seeking” of capitalism that we see in the modern and post-modern world.

Economic activity tempered by ethical considerations and The Moral Law ceased.

Dr. Jones argues that the “antithesis of this worldview can be summed up in the word ‘capitalism.’”

In Barren Metal, Dr. Jones mentions the encyclical Laborem Excerns, written by Pope John Paul II in 1981 where he emphasized the importance of labor in any economic system.

This encyclical in part stressed the importance of economics having a moral component that elevated labor above being a simple or resource that is simply a component of the cost of doing business,

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Labor and Capital

What we are really talking about here is the idea of labor versus capital and the capitalist view that labor is an “impersonal force needed for production” and the view of the Church has always been that there is a priority of “labor over capital”.

“…the priority of labor over capital applies to both capitalist and non-capitalist economic systems because it is a ‘postulate of the order of social morality.’

It exists prior to any economic system because morality, rooted as it is in the exigencies of free will and human choice, is antecedent to all economic decisions, which seek by their nature to achieve the good in an economic context.”

When these truths aren’t observed

“…an economic system treats work as ‘a special kind of 'merchandise’” or as "an impersonal 'force' needed for production," it runs the danger of repeating "the error of early capitalism," by treating man as "on the same level as the whole complex of the material means of production, as an instrument and not in accordance with the true dignity of his work, that is to say, where he is not treated as subject and maker, and for this very reason as the true purpose of the whole process of production." Capitalism's "degradation of man as the subject of work" created a "system of injustice and harm that cried to heaven for vengeance." The main response to that cry was socialism and communism…”

I’ve heard Dr. Jones describe socialism and communism as secular responses to the “boiling pus of capitalism” in a vain search for a  kind of materialistic utopia, but here Dr. Jones goes on to explain human labor as the essential component of wealth creation and the need for workers to enjoy protection by their government and not to be left to the machinations of market forces.

“Because labor is the sine qua non of all wealth production, it needs the protection of government, which needs to protect it from all forms of usury. The ‘attainment of the worker's rights’ needs government support cannot be left to the vagaries of the free market, the gold standard or any other self-regulating, market-based mechanism, which in reality is nothing more than a Tarnhelm which renders the usurer invisible.

The main criterion for judging the worth of any economic system is its treatment of labor.

The main criterion is the wage, and the main criterion for a wage is family life. If a man can raise a family on his salary alone, the wage he is earning can be said to be objectively just. A subsistence wage means no children, and no children means the end of the work force, which is the historical trajectory of all usury-based economies.”

Since America’s economic system does not enjoy the protection of their government and does not abide by the Moral Law, is bereft of any sense of morality, notion of social responsibility or social justice and permits labor to be treated as a commodity, American multi-national corporations are free to scour the globe in order to exploit labor markets and find labor sources at the lowest possible price without any consideration of the impact that these rapacious practices have on America and our middle-class.

The same forces that impacted the steel industry in the 70s and 80s, promoted NAFTA in the 90s are now offshoring American software, IT and other service-related jobs.

The same jobs that were promised by our politicians to be better than manufacturing jobs they eliminated decades ago.

Is anyone besides me sensing a trend here?

I saw it in the late 70s and the early 80s with the collapse of the steel industry.  I knew something was wrong, but I was too young and inexperienced to know what it was.

Then I saw it in the early 90s when Ross Perot ran for president and campaigned for the middle-class and against NAFTA which eventually destroyed more American jobs by sending them south of the border after its passage.

I am seeing it now when American corporations send American IT, Accounting, Support and HR jobs to places like Mexico, India, The Philippines and China while laying off thousands of American workers as management keeps feeding the crocodile in hopes it will eat them last.

The aphorism often attributed to Mark Twain that “History doesn’t repeat itself, but it often rhymes” certainly seems applicable here.

These things I am writing to tell you are based on 40 years of experience witnessing the gradual elimination of the American Middle Class and I can tell anyone willing to listen without reservation you are being lied to by politicians and the news media.

When the oligarchs needed workers for their American factories, marriage and traditional families were promoted to increase the birth rate in order to staff their factories. Now that this phase capitalism has ended, the religion of LGBTQ+ is promoted.

Why?

1. A zero-birth rate. This fills the elite’s mandate for population reduction.

2. They understand that a self-governed people are a moral people.  John Adams knew this when he said the “…Constitution was made only for a moral and religious people.”

They have no interest in a self-governed population and know that in the event of civil collapse, this opens up the opportunity to implement tyranny. 

The quote often attributed to Aristotle “Nature abhors a vacuum” is applicable here.

Regardless of their rhetoric, your political representatives do not care about you.

They have been bought and have been lobbied by the oligarchs, and corporate interests.

They have passed trade and labor deals written by the same rent-seeking oligarchs and corporate interests and are designed to obliterate the American middle-class.

They pretend to represent the electorate while working against us and for corporate interests and unless the electorate wakes up, wealth will continue to be concentrated into fewer and fewer hands and the middle-class will continue to be ground into dust and left with nothing but debt and despair.