Keeping the Rabble in Line Copyright ⌐ 1994 by Noam Chomsky and David
                                 Barsamian

                     The Emerging Global Economic Order

                             February 1, 1994

DB: In the fall of 1993 the Financial Times trumpeted, "The public sector
is in retreat everywhere." This is before the passage of the two major
corporate-state initiatives, NAFTA (North American Free Trade Agrrement)
and GATT (General Agreement on Trade and Tariffs). How were they able to do
it and what are the consequences?

First of all, it's largely true, but major sectors of the public sector are
alive and well, in particular those parts that cater to the interests of
the wealthy and the powerful. They're declining somewhat, but they're still
very lively. They're not going to disappear. How were they able to do it?
These are developments that have been going on for about twenty years now.
They had to do with major changes in the international economy that we've
talked about in earlier discussions. For one thing, the period of U.S.
global economic hegemony had pretty much ended by the early 1970s. Europe
and Japan had reemerged as major economic and political entities. There was
pressure on profits. The costs of the Vietnam War were very significant for
the U.S. economy, and extremely beneficial for its rivals. That tended to
shift the world balance. In any event, by the early 1970s the U.S. felt
that it could no longer sustain its traditional position as essentially
international banker, which was codified in the Bretton Woods agreements at
the end of the Second World War. Nixon dismantled that system. That led to
a period of tremendous growth in unregulated financial capital. It was
accelerated by the short-term rise in commodity prices, which led to a huge
flow of petrodollars into the now largely unregulated international system.

There were technological changes that took place at the same time which
were significant. The telecommunications revolution made it extremely easy
to transfer capital or paper equivalents of capital, in fact, electronic
equivalents of it, from one place to another. There has been an enormous
expansion of unregulated financial capital in the past twenty years. What's
more, its constitution changed radically. Whereas in the early 1970s about
ninety percent of financial transactions were devoted to long-term
investment and trade, basically more or less productive things, by now
that's reduced to ten percent. About ninety percent is being used for
speculation. This means that huge amounts of capital, $14 trillion,
according to a recent World Bank estimate, are now simply very quickly
moveable around the world basically seeking deflationary policies. It is a
tremendous attack against government efforts to stimulate the economy. I
think it was pointed out in the same Financial Times article to which you
referred. That's one factor.

Related to that was a very substantial growth in the internationalization
of production, so it became a lot easier than it had been in the past to
shift production elsewhere to places where you get much cheaper labor,
generally high-repression, low-wage areas. So it becomes much easier for,
say, a corporation executive who lives in Greenwich, Connecticut to have
corporate and bank headquarters in New York but the factory is in some
Third World country. That now includes Eastern Europe. These developments
placed powerful weapons in the hands of corporate and financial power. With
the pressure on corporate profits that began in the early 1970s came a big
attack on the whole social contract that had developed through a century of
struggle and had been kind of codified around the end of the Second World
War with the New Deal and the European social welfare states and so on.
There was a big attack on that, led first by the U.S. and England, and by
now going to the continent. It's had major effects. One effect has been a
serious decline in unionization, which carries with it a decline in wages
and other forms of protection of rights. That's led to polarization of the
society, primarily in the U.S. and Britain, but it's extending.

Just this morning driving in I was listening to the BBC. They reported a
new study of children in Britain which concluded that children living in
work houses a century ago had better nutritional standards than millions of
children in Britain today living in poverty. That's one of the grand
achievements of the Thatcher revolution, in which she succeeded in
devastating British society and destroying large parts of British
manufacturing capacity and driving England into, as the Financial Times
puts it, the poorhouse of Europe. England is now one of the poorest
countries in Europe, still above Spain and Portugal, but not much. It's
well below Italy. That's the British achievement.

The American achievement was rather similar. We're a much richer, more
powerful country, so it isn't possible to achieve quite what Britain
achieved. But the Reaganites succeeded in driving U.S. wages down so we're
now the second lowest of the industrial countries. Britain is the lowest.
Wages in Italy are about twenty percent higher than in the U.S., Germany
maybe sixty percent higher. Along with that goes a deterioration of the
general social contract. The breakdown in public spending or the kind of
public spending that goes to the less privileged. That's rather crucial.
That's just a concomitant. We should bear in mind, and it's important to
say, that the kind of public spending that goes to the wealthy and the
privileged, which is enormous, remains fairly stable. That's a major
component of state policy.

DB: What was the extent and quality of domestic opposition and resistance
to NAFTA and GATT?

That was quite interesting. The original expectation was that NAFTA would
just sail through. Nobody would ever even know what it is. So it was signed
in secret. It was put on a fast track in Congress, meaning essentially no
discussion. There was virtually no media coverage. Who was going to know
about a complex trade agreement? So the idea was, We just ram it through.
That didn't work. And it's interesting that it didn't work. There are a
number of reasons. For one thing, the labor movement got organized for once
and made an issue of it. Another was the maverick third party candidate
Ross Perot, who managed to make it a public issue. And it turned out that
as soon as the public heard about it and knew anything about it they were
pretty much opposed. The media coverage on this was extremely interesting.
Usually the media try to keep their class loyalties more or less in the
background. But on this issue the bars were down. They just went berserk,
especially toward the end when it looked like there was going to be a
problem. There was a very quick transition after it passed, incidentally.
I've written about this in Z Magazine. But nevertheless, despite this
enormous media barrage and the government attack and huge corporate
lobbying, which totally dwarfed anything else, of course, despite that the
level of opposition remained pretty stable. If you look at polls right
through the period, roughly sixty percent or so of those who had an opinion
remained opposed. It varied a little bit here and there, but that's quite
substantial. In fact, the end result is very intriguing. There was a poll
published a couple of days ago in which people had to evaluate labor's
actions with regard to NAFTA. The public was overwhelmingly opposed to the
actions of the labor movement against NAFTA, about seventy percent
opposition to it. On the other hand, the public also took exactly the same
position that labor was taking. So why were they opposed to it?

I think it's easy to explain that. The media went berserk. From Bill
Clinton down to Anthony Lewis, as you pointed out to me in an earlier
interview (December 6, 1993), there was just hysteria about labor's
musclebound tactics and these backward labor leaders trying to drive us
into the past, jingoist fanatics and so on. In fact, the content of the
labor critique has virtually not appeared in the press. But there was
plenty of hysteria about it all over the spectrum. Naturally people see
what's in the press and figure labor must be doing really bad things. The
fact of the matter is that labor, one of the few more or less democratic
institutions in the country, was representing the position of the majority
of those who had an opinion on NAFTA. Evidently from polls the same people
who approved of the positions that labor was actually advocating, though
they may not have known it, were opposed, or thought they were opposed to
the labor tactics.

I suspect that if someone had a close look at the Gore-Perot television
debate, they might well find the same thing. There were some interesting
facts about this debate which ought to be looked at more closely. I didn't
watch it, but friends who did watch it thought that Perot did quite well.
But the press, of course, instantly had a totally different reaction. The
news analysis right after was that Gore won a massive victory. Same thing
with next morning's headlines: tremendous victory for the White House. If
you look at the polls the next day, people were asked what they thought
about the debate. The percentage who thought that Perot had been smashed
was far higher than the percentage of people who had seen it, which means
that most of the people were getting their impression of what happened in
the debate from the front pages the next day or the television news. As the
story, whatever it may have been, was filtered through the media system, it
was turned into what was needed for propaganda purposes, whatever may have
happened. That's a topic for research. But on the reaction of the public to
labor's tactics, it's quite striking.

DB: One of the mass circulation journals that I get is Third World
Resurgence, out of Penang, Malaysia. In that I learned that in Bangalore,
India, half a million farmers demonstrated against GATT. I wonder if your
local paper, the Boston Globe, featured that.

I also read it in Third World Resurgence and in Indian journals. I don't
recall having seen it here. Maybe there was something. I wouldn't want to
say it wasn't reported without checking. But there is plenty of public
opposition in India to GATT. The same in Mexico on NAFTA. Incidentally, you
asked about GATT. What they had planned for NAFTA worked for GATT. So there
was virtually no public opposition to GATT, or even awareness of it. I
doubt a tiny fraction of the country even knows what it's about. So that
may be rammed through in secret, as intended. Strikingly, they couldn't
quite do that in the case of NAFTA. It took a major effort to get it
through, one which was very revealing about class loyalty and class lines.
In Mexico there was substantial public opposition. That was barely reported
here. What happened in Chiapas doesn't come as very much of a surprise.
There has been an attempt to portray the Chiapas rebellion as something
about the underdeveloped south as distinct from the developed modern north.
At first the government thought they'd just destroy it by violence, but
they backed off and they'll do it by more subtle violence, when nobody's
looking. Part of the reason they backed off is surely they were afraid that
there was just too much sympathy all over the country and that if they were
too up front about suppression they'd cause themselves a lot of problems
all the way up to the Mexican border. The Mayan Indians in Chiapas are in
many ways the most oppressed people in Mexico. Nevertheless, the problems
they are talking about are the problems of a large majority of the Mexican
population. Mexico too has been polarized by this decade of neo-liberal
reforms which have led to very little economic progress but have sharply
polarized the society. Labor's share in income has declined radically. The
number of billionaires is shooting up.

DB: But I found the mainstream media coverage of Mexico during the NAFTA
debate somewhat uneven. You mentioned the New York Times. They have allowed
in a number of articles that official corruption was and is widespread in
Mexico. In fact, in one editorial they virtually conceded that Salinas
stole the 1988 presidential election. Why did that information come out?

I think that that's impossible to repress. Furthermore, there were
scattered reports in the Times of popular protest against NAFTA. Tim
Golden, their reporter in Mexico, had a story a couple of weeks before the
vote, probably early November, in which he said that lots of Mexican
workers are concerned that their wages would decline after NAFTA. Then came
the punch line. He said that undercuts the position of people like Ross
Perot and others who think that NAFTA is going to harm American workers for
the benefit of Mexican workers. In other words, they're all going to get
screwed. It was presented in that framework as a critique of the people who
were opposing NAFTA here. But there was very little discussion here of the
large-scale popular opposition in Mexico, which included, for example, the
largest non-governmental trade union. The main trade union is about as
independent as the Soviet trade unions were. There were large public
protests not reported here. The environmental movements were opposed. Most
of the popular movements were opposed. The Mexican Bishops' Conference came
out with quite a strong statement criticizing NAFTA and endorsing the
position of the Latin American bishops at Santo Domingo in December 1992.
There was a conference of Latin American bishops, the first one since
Puebla and Medellin back in the 1960s and 1970s, which was quite important.
It was not reported here, to my knowledge. The Vatican tried to control it
this time to make sure that they wouldn't come out with these perverse
ideas about liberation theology and the preferential option for the poor.
But despite a very firm Vatican hand the bishops came out quite strongly
against neo-liberalism and structural adjustment and these
free-market-for-the-poor policies. The Mexican bishops reiterated that in
their critique of NAFTA. If there was anything about that here, I didn't
see it.

DB: What about the psychological and political position people like us find
ourselves in of being "against," of being anti, re-active rather than
pro-active?

NAFTA's a good case, because in fact the NAFTA critiques were pro-active.
Very few of the NAFTA critics were saying, No agreement. Not even Perot. He
had constructive proposals. The labor movement, the Congressional Office of
Technology Assessment, which issued another major report that was also
ignored, and other critics, in fact, virtually every critic I saw, were
saying there would be nothing wrong with a North American Free Trade
Agreement. But not this one. It should be different. The respects in which
it should be different were outlined in some detail. It's just that it was
all suppressed. What's left is the picture that, say, Anthony Lewis
portrays, jingoist fanatics screaming about NAFTA. Incidentally, what's
called the left played the same game. James Galbraith is a left-liberal
economist at the University of Texas. He wrote an article in which he also
denounced the jingoist left. He picked me out as the main person, quoting
an article in which I said the opposite of what he attributed to me, of
course, but that's normal. It was in a sort of left-liberal journal, World
Policy Review. He said there's this jingoist left, nationalist fanatics,
who don't want Mexican workers to improve their lives. Then he went on with
how the Mexicans are in favor of NAFTA. By the Mexicans he meant Mexican
industrialists and executives and corporate lawyers. He didn't mean Mexican
workers and peasants. He doesn't have a word about them. All the way over
from people like James Galbraith and Anthony Lewis, to way over to the
right, you had this very useful fabrication, that critics of NAFTA were
just reactive and negative and that they were jingoist and were against
progress and wanted to go back to old-time protectionism. When you have
essentially total control of the information system, it's rather easy to
convey that image. It leads to the conclusion that you describe, that the
critics are re-active and not pro-active. It isn't true. You read the
reports and studies and analyses and you see that they had very
constructive proposals.

DB: In early January you were asked by an editor of the Washington Post to
submit an article on the New Year's Day uprising in Chiapas. Was this the
first time they had asked you to write something for them?

That was the first time ever. It was for the Sunday Outlook section. I was
kind of surprised. I'm never asked to write for a major newspaper. I wrote
it. It didn't appear.

DB: Was there an explanation?

No. It went to press, as far as I know. The editor who had asked me called
me saying it looked OK and then later told me that it had simply been
cancelled at some higher level. I don't know any more about it than that.
Although I can guess. That article was about Chiapas, but it was also about
NAFTA, and I think the Washington Post has been even more extreme than the
Times in keeping discussion of this topic within narrow bounds.

DB: In that article you write that the protest of Indian peasants in
Chiapas gives "only a bare glimpse of time bombs waiting to explode, not
only in Mexico." What did you have in mind?

Take South Central Los Angeles, for example. In many respects, different
societies and so on, but there are points of similarity to the Chiapas
rebellion. South Central Los Angeles is a place where people once had jobs
and lives. Those jobs and lives have been destroyed. They have been
destroyed in large part by the socio-economic processes that we have been
talking about. For example, say, furniture factories went to Mexico where
they can pollute more cheaply. Military industry, the big public input into
the high-tech system, has somewhat declined, especially in the L.A. area.
People used to have jobs in the steel industry. They don't any more. They
rebelled. The Chiapas rebellion was quite different. It was much more
organized, much more constructive, and it's the difference between an
utterly demoralized society, like South Central Los Angeles, the kind we
have, and a society that still retains some sort of integrity and community
life and so on, though objectively poorer. When you look at consumption
levels, doubtless Mexican peasants are poorer than people in South Central
Los Angeles. There are fewer television sets per capita. By other, more
significant criteria, mainly social cohesion, integrity of the community,
they're considerably more advanced. We have succeeded in the U.S. not only
in polarizing but also in destroying community structures. That's why you
have such rampant violence. That's one case.

Take another which is even more dramatic. A couple of days after the NAFTA
vote, the Senate overwhelmingly passed the most extraordinary crime bill in
history. It was hailed with great enthusiasm by the far right as the
greatest anti-crime bill ever. I think that it greatly increased, by a
factor of five or six, federal spending for "fighting crime". There's
nothing constructive in it. There are more prisons, more police, heavier
sentences, more death sentences, new crimes...

DB: Three strikes and you're out.

Three strikes and you're out. Membership in a gang is a crime. Clinton has
quickly moved to pick this up as his major social initiative. That makes a
lot of sense, and it makes a lot of sense that it should appear right after
NAFTA. NAFTA will continue, maybe accelerate the polarization of society.
No one has any plans for these people who are being marginalized and
suppressed. There will be more South Central Los Angeles-type situations.
It's unclear how much pressure and social decline and deterioration people
will accept. One tactic is just drive them into urban slums, concentration
camps, in effect, and let them prey on one another. But that has a way of
breaking out and affecting the interests of wealthy and privileged people.
So we'd better build up the jail system, which incidentally is also a shot
to the economy. That's public spending, which gives a kind of economic
stimulus as well. It's natural that Clinton should pick exactly that as his
topic. Not only for a kind of ugly political reason. It's easy to whip up
hysteria about that. But also because it reflects the general point of view
of the so-called New Democrats, the business-oriented segments of the
Democratic Party.

DB: One last point on Mexico: You talked about the wages being depressed.
There has also been significant union busting and smashing. Describe what
happened at a couple of auto plants in Mexico, one involving Ford and one
involving Volkswagen.

Ford and VW are two big examples. Within the last few years, I think for VW
it was 1992 and Ford a few years earlier, Ford just fired its entire work
force and would rehire at a much lower wage level only those who agreed to
be non-unionized. They're backed by the always ruling party when they do
this. In VW's case it was pretty much the same. They fired workers who
supported an independent union. They were willing to allow the fraudulent
government union. But those who sought to get an independent union were
kicked out and only those who agreed not to support it were rehired at
lower wages.

A few weeks after the NAFTA vote in the U.S., workers at a GE and Honeywell
plant in Mexico were fired for union activities. I don't know what the
outcome is, but that was again symbolic. That's exactly what things like
NAFTA are about. Whether NAFTA in the long term will lower the wages of
Mexican workers is kind of hard to predict. There are a lot of complicated
factors. I think it may very well. That it will lower the wages of American
workers is hardly in doubt. The strongest NAFTA advocates point that out in
the small print. My colleague at MIT, Paul Krugman, is a specialist in
international trade and interestingly one of the economists who had done
some of the theoretical work showing flaws in free trade. He nevertheless
was an enthusiastic advocate of NAFTA, which is, I should stress, not a
free trade agreement. But he did point out, if you look, that the only
people who will lose will be unskilled workers. A footnote: Seventy percent
of the work force is classified as "unskilled." They're the only ones who
will lose.

The Clinton Administration has various, I don't know if they believe it or
not, fantasies about retraining. They aren't doing anything about that, but
even if they did, it would probably have very little impact. What's true of
industrial workers is also true of skilled white-collar workers. You can
get software programmers in India who are very well trained at a fraction
of the cost of American programmers. Somebody involved in this business
recently told me that Indian programmers are actually being brought to the
U.S. and kept at Indian salaries, a fraction of American salaries, in
software development. So that can be farmed out just as easily.

The chances of retraining having much of an effect are slim. The problems
are quite different. The problems are that in the search for profit, you
will try to repress people's lives as much as possible. You wouldn't be
doing your job otherwise.

DB: An interesting thing happened in Alabama involving Daimler-Benz, the
big German auto manufacturer.

This deterioration of the policies that destroy unions and undermine wages
have a whipsaw effect. It's not only Mexico and the U.S. It's also across
the industrial world. So now that the U.S. has managed, under Reagan, to
drive wages down way below the level of its competitors, except for
Britain, that's had its international effects. So one of the effects of the
so-called free trade agreement with Canada was to stimulate a big flow of
jobs from Canada to the southeast U.S. because these are essentially
non-union areas. Wages are lower. You don't have to worry about benefits.
Workers can barely organize. So that's an attack against Canadian workers.
What you're describing now simply shows the internationalization of these
effects. Daimler-Benz, which is Germany's biggest conglomerate, was seeking
essentially Third World conditions. They managed to get the southeastern
states to compete against one another to see who could force the public to
pay the most to bring them there. Alabama gave the biggest package. They
offered them hundreds of millions of dollars in tax benefits. They
practically gave them the land for free. They agreed to build all sorts of
infrastructure for them. The cost to the citizens of Alabama is
substantial. But there will be people who benefit. The small number of
people who are employed there, some spillover to hamburger stands and so
on, but primarily bankers, corporate lawyers, people involved in investment
and finance and financial services and so on, they'll do very well.

It was interesting that even the Wall Street Journal, which is rarely
critical of business, pointed out that this is very much like what happens
when rich corporations go to Third World countries and questioned whether
there were going to be overall benefits for the state of Alabama. Probably
not, although for sectors of Alabama, especially the corporate, financial
and skilled professional sectors, there will be benefits. The general
public will pay the costs.

Meanwhile Daimler-Benz can use that to drive down the living standards of
German workers. That's in fact the way the game is played. Southeastern
U.S. is one case. But of course Mexico, Indonesia, and now east Europe are
much better cases. For example, VW will throw out their work force in
Mexico and rehire it. But they'll also set up factories in the Czech
Republic, as they are now doing, where they can get workers for about ten
percent of the cost of German workers. It's right across the border. It's a
westernized society. High educational levels. Nice white people with blue
eyes. You don't have to worry about that. Of course, they insist on plenty
of benefits. They don't believe in the free market any more than any other
rich people do, so they leave the Czech Republic to pay the social costs of
pollution, debts, etc. They'll just pick up the profits. It's exactly the
same when GM moves to Poland. GM is building plants in Poland, but of
course insisting on thirty percent tariff protection. The free market is
for the poor. We have a dual system. Free markets for the poor and state
socialism for the rich.

DB: After your return from a recent trip to Nicaragua you told me it's
becoming more difficult to tell the difference between economists and Nazi
doctors. What did you mean by that?

A report from UNESCO just appeared, which I haven't seen reported here. It
was reported in the Financial Times of London, which estimated the human
cost of what are called reforms, a nice-sounding word, in Eastern Europe
since 1989. "Reforms" is a propaganda term. It implies that the changes are
good things. If a populist government took over private industries, that
wouldn't be called "reform." By referring to the policies as "reforms," the
press is able to avoid any discussion of whether they are good or bad
policies. They are good, by stipulation. But the so-called reforms, meaning
returning Eastern Europe to its Third World status, have had social costs.
The UNESCO study tries to estimate them. For example, in Russia they
estimate about a half-a-million deaths a year as a direct result of the
reforms, meaning the effect of the collapse of health services, the
increase in disease, the increase in malnutrition, and so on. Killing
half-a-million people a year, that's a fairly substantial achievement for
reformist economists. You can find similar numbers, though not quite that
bad, in the rest of Eastern Europe, if you look at death rates from
malnutrition, polarization, suffering. It's a great achievement.

If you go to the Third World, the numbers are fantastic. So for example,
another UNESCO report estimated that in Africa about half-a-million
children die every year simply from debt service. Not from the whole array
of "reforms," just debt service. About eleven million children are
estimated to die every year from easily treatable diseases. Most of them
could be overcome by a couple of cents' worth of materials. But the
economists tell us that to do this would be interference with the market
system. It's not new. It's very reminiscent of British economists during
the Irish famine in the mid-nineteenth century, when economic theory
dictated that famine-struck Ireland must export food to Britain, which it
did, right through the Irish famine, and should not be given food aid
because that would violate the sacred principles of political economy.
These principles typically have this curious property of benefiting the
wealthy and harming the poor.

DB: You'll recall the uproar in the 1980s about Sandinista abuses of the
Miskito Indian population on the Atlantic coast. President Reagan, in his
inimitable style of understatement, said it was "a campaign of virtual
genocide." UN Ambassador Jeane Kirkpatrick was a bit more restrained. She
called it the "most massive human rights violation in Central America."
What's happening now with the Miskito Indians in Nicaragua?

They were talking about an incident in which, according to Americas Watch,
several dozen Miskitos were killed and lots of people were forcefully moved
in a very ugly way in the course of the contra war. The U.S. terrorist
forces were moving into the area and this was the reaction. It was
certainly an atrocity, but you couldn't even see it in comparison to the
atrocities that Jeane Kirkpatrick was celebrating in the neighboring
countries at the time, or for that matter in Nicaragua, where the
overwhelming mass of the atrocities were committed by the so-called freedom
fighters.

What's happening to the Miskitos now? I was in Nicaragua in October. Church
sources, the Christian Evangelical Church, primarily, who work in the
Atlantic coast, were reporting that 100,000 Miskitos were starving to
death, largely as a result of the policies that we are imposing on
Nicaragua. Not a word here.

Another problem among the Miskitos is narcotics. One typical consequence of
U.S. victories in the Third World, which again includes much of Eastern
Europe, is that the countries where we win immediately become big centers
for drug flow.

There are good reasons for that. That's part of the market system that we
impose on them. Nicaragua has now become a major drug transshipment center.
There's a little concern about that here, so that gets into the press. If
you look at the small print, you'll discover that a lot of it goes through
the Atlantic coast now that the whole governmental system has collapsed.
There's also a drug epidemic. This goes along with being a drug
transshipment area.

It's a major epidemic among the Miskitos, in particular, among the divers.
Miskito Indian divers, both in Nicaragua and Honduras, are compelled by
economic circumstances to carry out diving under horrendous conditions.
They are forced to do very deep diving without equipment for lobsters and
other shellfish. It's a market system. You've got plenty of superfluous
people. So you make them work under these conditions. If they die off fast
you just bring in others. That's a standard free-market technique. In order
to try to maintain their work rate they stuff themselves with cocaine.
Somehow it enables them to bear the pain. So that actually sort of got
reported. There was a little report about cocaine use among Miskito
Indians. Of course, nobody cared much about the work conditions, or why
they are there. That's the situation of the Miskito Indians in Nicaragua
today. In Honduras it may even be worse.

DB: This speaks volumes about the whole notion of worthy victims whose
plight can be attributed to official enemies, and then when the enemies are
eliminated, they become unworthy victims.

It's a clear example of that. If you want another example, in many ways an
uglier one, have a look at today's Boston Globe. There's an op-ed by Sidney
Schanberg blasting Senator Kerry of Massachusetts for being dishonest and
two-faced because he is refusing to concede that the Vietnamese have not
been entirely forthcoming about American POWs.

Nobody, according to Schanberg, is honest enough to tell the truth about
this. He says the government ought to finally have the honesty to say that
it left Indochina without accounting for all the Americans. Of course, it
wouldn't occur to him to suggest that the government should be honest
enough to say that we killed a couple of million people and destroyed three
countries and left them in total wreckage and have been strangling them
ever since. It is particularly striking that this is Sidney Schanberg. He
is regarded as the great conscience of the press because of his intrepid
courage in exposing the crimes of official enemies, namely Pol Pot. He also
happened to be the main U.S. reporter in Phnom Penh in 1973, which was the
peak of the U.S. bombardment of inner Cambodia, when tens of thousands of
people were being killed and the society was being wiped out.

Nobody knows very much about the bombing campaign and its effects because
people like Sidney Schanberg refused to cover it. It wasn't a big effort
for him to report it. He didn't have to go trekking off into the jungle to
find the appropriate refugees. He could walk across the street from his
fancy hotel in Phnom Penh, where there were hundreds of thousands of
refugees driven from the countryside into the city. I went through all of
his reporting. It's reviewed in detail in Manufacturing Consent, my book
with Edward Herman. He simply refused to interview refugees to find out
what was going on in inner Cambodia. Only a few sentences of refugee
testimony appear in his dispatches.

To heighten the depravity, to make it very clear just what he is, there
happens to be one rather detailed report of an American atrocity. If you
look at the movie The Killing Fields, which is based on his story, it opens
by describing this atrocity, which he did report for about three days.
What's the one report? American planes hit the wrong village, a government
village. That's an atrocity. That was reported. How about when they hit the
right village? We don't care about that. One of the reasons why we know
very little about this monstrous atrocity in inner Cambodia is that people
like Sidney Schanberg wouldn't report it.

Now he's orating about the lack of honesty and the two-facedness of people
who won't say that we left POWs behind. Incidentally, take a look at the
U.S. record with POWs. It was atrocious. Not only in Vietnam, where it was
monstrous, but in Korea, where it was even worse. U.S. treatment of POWs in
Korea was an absolute scandal. It's been well discussed in the scholarly
literature. If you go back to the Pacific war, it's also horrible,
including after the war, when we kept prisoners illegally under
confinement, as did the British.

DB: Other Losses, a Canadian book, alleges it was official U.S. policy to
withhold food from German prisoners. Many of them supposedly starved to
death.

That's James Bacque's book. There's been a lot of controversy about the
details, and I'm not sure what the facts of the matter are. He did say
that. On the other hand, there are things on which there's no controversy.
Ed Herman and I wrote about it back in the late 1970s, in our book
Political Economy of Human Rights. It was kind of striking. Just at the
time that the first uproar was being whipped up about the American POWs,
scholarly work was coming out about American and British treatment of
German POWs during and after the Second World War. There were some reviews
of this material. They were lauding the humanitarian efforts of the
Americans and the British.

If you looked at the material, what happened was that the Americans were
running "re-education camps" for German prisoners. Since it was in gross
violation of international conventions, it was concealed. They finally
changed the name. They picked some Orwellian name for it instead of
re-education camps. This was hailed as a tremendous example of our
humanitarianism, because we were teaching them democratic ways. In other
words, we were indoctrinating them into accepting our beliefs. Therefore
it's humanitarian in these re-education camps. They kept it secret because
they were afraid that the Germans might retaliate and treat American
prisoners the same way. Prisoners were being treated very brutally, killed
and starved and so on.

Furthermore, it went on after the war. The U.S. kept German POWs until
mid-1946, I think. They were used for forced labor, beaten, and killed. It
was much worse in England. There they kept them until, I think, mid-1948.
All totally illegal -- forced labor, violence, and so on.

Finally there was public reaction in Britain. The person who started it off
was Peggy Duff, a marvelous woman who died a couple of years ago. She was
later one of the leading figures in the CND and the international peace
movement during the 1960s and 1970s. She started off her career with a
protest against the treatment of German POWs.

Incidentally, why only German POWs? What was happening to the Italian POWs?
We don't know anything about that. The reason is that Germany is a very
efficient country. So they have published volumes of documents on what
happened to German POWs. But Italy's sort of laid back, and at least at
that time there was no research on the surely much worse treatment of
Italian POWs.

I can remember this as a kid. There was a POW camp right next to my high
school. There was controversy among the students over the issue of the
students taunting the prisoners. There were a group of us who thought this
was horrifying and objected to it, but very few. That's not the worst of
it, of course.

DB: At the same time this was going on with the prisoners of war after
World War II, there was Operation Paper Clip. Chris Simpson describes this
in his book Blowback, and you've discussed it as well. It involved the
importation, on a large scale, of known Nazi war criminals, rocket
scientists, camp guards, etc.

That was part of it. But it was actually much worse than that. There was
also an operation involving the Vatican and the U.S. State Department, and
American-British intelligence, which took some of the worst Nazi criminals,
like Klaus Barbie, and used them. Klaus Barbie was taken over by U.S.
intelligence and returned to exactly the operations that the Nazis had him
doing. Later, when it became an issue, some of his supervisors pointed out
that they didn't see what the fuss was all about.

They said: We needed a guy who would attack the resistance. We had moved
in. We had replaced the Germans. We had the same task they did, namely
destroy the resistance, and here was a specialist. He had been working for
the Nazis to destroy the resistance, the butcher of Lyon, so who would be
better placed to continue exactly the same work for us, when we moved in to
destroy the resistance?

So Barbie worked for the Americans as he had worked for the Nazis. When
they could no longer protect him, they moved over to the Vatican-run
ratline operation, with Croatian Nazi priests and others, and managed to
spirit him off to Latin America, where his career continued. In fact, he
became a big drug lord and narcotrafficker, and was involved in Bolivia in
a military coup, all with U.S. support.

Klaus Barbie was basically a small operator. There were much bigger people.
We managed to get Walter Rauff, the guy who invented gas chambers, off to
Chile. Others went to fascist Spain. This was a big operation involving
many top Nazis. That's only the beginning. Reinhard Gehlen was the leading
figure. He was the head of German military intelligence on the eastern
front. I don't have to tell you what that means. That's where the real war
crimes were. Now we're talking about Auschwitz and other death camps.

Gehlen was taken over quickly by American intelligence and returned
essentially to the same role. The U.S. was supporting German-established
armies in Eastern Europe. The U.S. continued to support them at least into
the early 1950s.

It turns out the Russians had penetrated American intelligence, so the air
drops didn't work very well. But they were trying to support Hitler's
armies in Eastern Europe. Gehlen was returned to the operations that he had
carried out under the Nazis. Furthermore, German, as they called them,
counterterrorist specialists, meaning people who were fighting the
partisans and the resistance, were taken over by the American army. Their
records and expertise were used to create counterinsurgency doctrine.

In fact, if you look at the American army counterinsurgency literature, a
lot of which is now declassified, it begins by an analysis of textbooks
written with the cooperation of Nazi officers recording the German
experience in Europe. It describes everything from the point of view of the
Nazis, e.g., which techniques for controlling resistance worked, which ones
didn't work. That becomes simply transmuted with barely a change into
American counterinsurgency literature. This is discussed at some length by
Michael McClintock in a book called Instruments of Statecraft, a very good
book which I've never seen reviewed. It's quite illuminating on this topic.

DB: This makes an interesting counterpoint to the opening of the Holocaust
Museum in Washington, D.C. and the current widespread popularity of Stephen
Spielberg's film Schindler's List, that the U.S. was not passively engaged
in recruiting German war criminals but was in fact actively engaged. Is it
about this that you say that if a real history of the aftermath of the
Second World War were ever written this would be the first chapter?

This would be a part of the first chapter. Recruiting Nazi war criminals
and saving them is bad enough, but continuing the activities that they
carried out is worse. The first chapter of postwar history, in my view,
would be the description of the British and U.S. operations, mostly U.S.,
given power relations, throughout the world to destroy the anti-fascist
resistance and restore the traditional essentially fascist order to power.

That took different forms in different parts of the world. In Korea, where
we ran it alone, it meant killing about 100,000 people, just in the late
1940s before what we called the Korean War. In Greece it meant supporting
the first major counterinsurgency war, which destroyed the peasant- and
worker-based anti-Nazi resistance and restored collaborators to power.

Italy is a very interesting case. A lot of information is just coming out
now. The British first, and then the Americans, as they moved in, wanted to
destroy the very significant resistance movement. It had liberated most of
northern Italy. The Americans essentially wanted to restore the fascist
order, as did the British. This is the British Labor Party, incidentally.
In the south, they simply restored the fascist order, the industrialists.
The Americans tried to get leading fascists in, like Dino Grandi, but the
Italians wouldn't accept it, so they took an Italian war hero, Badoglio,
and essentially restored the old system.

But the big problem was when they got to the north. There the Italians had
already been liberated. The Germans had been driven out by the Italian
resistance. The place was functioning. Industry was functioning. First
Britain and then the U.S. had to dismantle all of that and restore the old
order. Their attitude is extremely interesting. It's just coming out now in
books. There is one by an Italian scholar, Federico Romero, who describes
this very positively. The big critique of the resistance was that they were
displacing the old owners in favor of popular workers' and community
control. This was called "arbitrary dismissal" of the legitimate owners.
They were also hiring what was called "excess workers," meaning they were
giving jobs to people beyond what's called economic efficiency, meaning
maximal profit-making. In other words, they were trying to take care of the
population and they were more democratic. That had to be stopped. The prime
commitment, as the documents say, was to eliminate this arbitrary dismissal
of legitimate owners and the hiring of excess workers.

There was also another problem which they recognized. Of course the most
severe problem for Italy at the time was hunger and unemployment. But
that's the Italians' problem, the British labor attachΘ explained. Our
problem, the problem of the occupying forces, is to eliminate this hiring
of excess workers and arbitrary dismissal of owners. Then they can worry
about the other problem, everybody starving. This is, I should say,
described very positively, showing how law-abiding we are. It goes right to
contemporary neo-liberalism without much change.

The next thing was to try to undermine and destroy the democratic process,
which the U.S. was very concerned about in Italy. The left was obviously
going to win the elections. It had a lot of prestige from its involvement
in the resistance and the traditional conservative order had been
discredited. The U.S wouldn't tolerate that. The first memorandum of the
first meeting of the newly-formed National Security Council in 1947 is
devoted to this. This was a major issue. They decided that they would
undermine the election. There were big efforts made to undermine the
election, to withhold food and put all sorts of pressure to ensure that the
democratic system couldn't function and that our guys would get in.

That's a pattern that's been relived over and over. Nicaragua recently is
another case. You strangle them. You starve them. And then you have a free
vote and everybody talks about how wonderful democracy is. They were afraid
that violence and coercion might not work. The fascist police and
strikebreakers were put back. They said: In the event that the communists
win a democratic election legitimately, the U.S. will declare a national
emergency, put the Sixth Fleet on alert in the Mediterranean and support
paramiltiary activities to overthrow the Italian government. That's NSC 1,
the first National Security Council Report.

There were other people who were more extreme, like George Kennan, who
thought that we just ought to invade the place, not even let them have the
election. They managed to hold him back, figuring that subversion and
terror and starvation would do it. And it did. Then comes a long follow-up,
right into at least the 1970s, when records dry up.

Maybe it's still going on. Probably the major CIA effort in the world was
the subversion of Italian democracy, from the 1940s right to the very
modern period, including support for ultra-right Masonic Lodges and
paramilitary elements and terrorists and so on. A very ugly story.

If you look at France and Germany and Japan, you get pretty much the same
thing. That ought to be chapter 1 of postwar history. The person who opened
up this topic and many others was Gabriel Kolko, in his classic book
Politics of War (1968) which has really been shamefully ignored. It's a
terrific piece of work. A lot of the documents weren't around then, but his
picture turns out to be quite accurate, and it's been by now supplemented
by a lot of specialized monographic materials.

DB: Let's talk about human rights in a contemporary framework with one of
our major trading partners, China.

Today's a good day to talk about it. The State Department just came out
with its report on human rights in China. I haven't read the whole report,
just the newspaper account, but I'm willing to predict. In the Asia Pacific
summit in Seattle, the one substantive achievement was sending more
high-tech equipment to China, in violation of legislation, which the
governemnt would reinterpret to allow it; the legislation was because of
China's involvement in nuclear and missile proliferation, so we therefore
sent them nuclear generators and sophisticated satellites and Cray
supercomputers. Right in the midst of that summit is a little tiny report
which you can find tacked on to the articles about the grand vision in
Asia, saying that 81 women had been burned to death. They were locked in a
factory in what's called booming Guandong province, the economic miracle of
China.

A couple of days later sixty workers were killed in a Hong Kong-owned
factory. The China Labor Ministry reported that eleven thousand workers had
been killed in industrial accidents just in the first eight months of 1993,
double the figure of the preceding year.

These atrocities and the women locked into factories never enter the human
rights report. On the other hand, it would be unfair to say that labor
practices never enter it. They do. There's been a big hullabaloo about the
use of prison labor. Front-page stories in the Times. It's terrible. Prison
labor we're opposed to. But locking women in factories in foreign-owned
enterprises where they burn to death, that's just one of those things that
happens.

What's the difference? Very simple. Prison labor does not contribute to
private profit. That's state enterprise. Prison labor in fact undermines
private profit because it competes with private industry. On the other
hand, locking women in factories where they burn to death contributes to
private profit. So prison labor is a human rights violation. But there is
no right not to be burned to death. In fact, that's just part of the
capitalist system. We're in favor of that. People might be burned to death,
but we have to maximize profit. From that principle everything follows.
Opposition to prison labor to silence about eleven thousand workers being
killed in industrial accidents.

DB: Notions of democracy fill the air. Clinton's National Security Advisor,
Anthony Lake, is encouraging democracy enlargement overseas. Might Anthony
Lake extend that to the U.S.?

I can't tell you what Anthony Lake has in mind, but the concept of
democracy that's been advanced is a very special one. It's one that the
more honest people on the right describe accurately. For example, there are
some interesting writings recently by Thomas Carothers, who was involved in
the Reagan administration in what they called the "democracy assistance
project" in the 1980s. He has a book and several articles about the
achievements of the project. He takes the commitment seriously, which is
odd, to say the least, even given his own report and evaluation.

Carothers gives an assessment which is rather accurate. He said that the
U.S. sought to create a form of top-down democracy which would leave
traditional structures of power with which the U.S. had always been allied
still in effective control. That kind of democracy is OK. That's the kind
of democracy that's being enhanced, at home as well, a form of democracy
which leaves traditional structures of power in control and in fact, in
greater control. Traditional structures of power are basically the
corporate sector and its affiliates. Any form of democracy that leaves them
unchallenged, that's admissible. Any form that undermines their power is as
intolerable as ever.

DB: We should have a lexical definition of democracy and then the practical
definition.

The practical definition is something like the one that Thomas Carothers
describes and criticizes. The lexical definition is that democracy has lots
of different dimensions. But roughly speaking, a society is democratic to
the extent that people have meaningful opportunity to take part in
formation of public policy. Insofar as that's true, the society's
democratic, and there are a lot of different ways in which that can be
true. Society can have the formal trappings of democracy and not be
democratic at all. The Soviet Union, for example, had elections.

DB: You've commented that the U.S. has a formal democracy with primaries,
elections, referenda, recalls, and so on. But what is the content of this
democracy in terms of popular participation?

The content has generally been rather slight. There are changes, but over
long periods the involvement of the public in planning or implementation of
public policy has been quite marginal. It's a business-run society. For a
long time the parties have reflected business interests.

One version of this view which I think has much power behind it is what
political scientist Thomas Ferguson calls the investment theory of
politics. He argues that since the early nineteenth century the political
arena has been a domain in which there's a conflict for power among groups
of investors who coalesce together on some common interest and invest to
control the state. The ones who participate are the ones who have the
resources and the private power to become part of a meaningful coalition of
investors. He argues, plausibly, I think, that long periods of apparent
political compromise, when not much is going on of a major character in the
political system, are simply periods in which the major groups of investors
have seen more or less eye to eye on what public policy should look like.
The moments of conflict which come along, like the New Deal, are cases
where you do have some differences in perspective and point of view among
groups of investors.

So in the New Deal period there were various groupings of private capital
which were in conflict over a number of issues. He identifies, among
others, a high-tech capital-intensive, internationally oriented,
export-oriented sector who tended to be quite pro-New Deal and in favor of
the reforms. They wanted an orderly work force. They didn't want to be
bothered. They wanted an opening to foreign trade. A more labor-intensive,
more domestically oriented group, essentially around the National
Association of Manufacturers, were strongly anti-New Deal. They didn't want
any of these reform measures.

Of course, those groups were not the only thing involved. There was the
labor movement, a lot of public ferment and so on, that led to something
happening in the political arena.

DB: You view corporations as being incompatible with democracy. You say if
we apply the concepts we use in political analysis they are fascist.
"Fascist" is a highly charged term. What do you mean?

I mean fascism pretty much in the traditional sense. So when a rather
mainstream person like Robert Skidelsky, the biographer of Keynes,
describes the early postwar systems as modeled on fascism, he simply means
the system of state coordination of corporate sectors. It integrates labor,
capital, and so on, under the control of those who have power, which is the
corporate system and with general state coordination. That's what a fascist
system traditionally was. It's absolutist. Power goes from top down. Even a
fascist system can vary in the way it works, but the ideal state is top
down control with the public essentially following orders.

Let's take a look at a corporation. Fascism is a term that applies to the
political domain, so it doesn't apply strictly to corporations. But if you
look at what they are, power goes strictly top down, from the board of
directors to managers to lower managers to ultimately the people on the
shop floor, typing messages, and so on. There's no flow of power or
planning from the bottom up. People can disrupt and make suggestions, but
the same is true of a slave society. The structure of power is linear, from
top to bottom, ultimately back to owners and investors. As for those who
are not part of that structure, they have nothing to say about it. They can
choose to rent themselves to it, and enter into the system at some level,
following the orders from above and giving them to those down below. They
can choose to purchase the commodities or services that it produces. That's
it. That's the totality of their involvement in the workings of the
corporation.

That's something of an exaggeration, because corporations are subject to
some legal requirements and there is some limited degree of public control.
There are taxes and other things. That reflects the parliamentary system to
the extent that that's democratic. Corporations are more totalitarian than
the things we call totalitarian in the political system. These are vast.
We're not talking about small isolated islands in some huge sea. We're
talking about islands which are the size of the sea. Their operations,
including much of what is called "trade," are centrally managed by highly
visible hands which may introduce severe market distortions. So, for
example, a corporation that has an outlet in Puerto Rico may decide to take
its profits in Puerto Rico because of tax rebates and change the pricing
system, what's called transfer pricing, so they don't seem to be making a
profit here. There are severe market distortions, as in fact in any form of
central internal planning. It's a very substantial and growing part of
interactions across borders, which really shouldn't be called trade.

About half of what are called U.S. exports to Mexico are just intrafirm
transfers. They don't enter the Mexican market. There's no meaningful sense
in which they're exports to Mexico. It means Ford Motor Company has
components constructed here and ships them to a plant which happens to be
on the other side of the border where they get much lower wages and don't
have to worry about pollution, unions, and that sort of nonsense. Then they
ship them back here. Mexico has nothing to do with it.

According to the last figures I saw, about seventy percent of Japanese
exports to the U.S. were in that category. These are major market
distortions, and growing. When people say that GATT and NAFTA are free
trade agreements, there are many respects in which that's not true. Some of
the respects in which it's not true is that these investor rights
agreements, as they ought to be called, extend the power of international
corporations and finance. That means extending their ability to carry out
market distorting operations internally.

If you tried to get a measure of the effect of the distortion of market
principles, which I don't think anybody has ever done, you'd probably find
that it's quite significant. Things like shifting pricing around to
maximize profit are more or less functionally equivalent to non-tariff
barriers to trade and voluntary export restrictions. There are estimates of
the scale of non-tariff barriers. But I know of no estimates of internal
corporate interference with market processes that way. They may be large in
scale and are sure to be extended by the trade agreements. These are huge
totalitarian institutions which are in a kind of oligopolistic market with
plenty of government interference. There are market factors that affect
them, but internally, they have little to do with market principles, and
they are totalitarian. So when people like Anthony Lake, to get back to the
original point, talk about enlarging market democracy, they are enlarging
something, but it's not simply markets and it's not democracy.

DB: You describe free trade as protection for the rich and market
discipline for everyone else.

That's what it comes down to. So the poor are indeed subjected to market
discipline. The rich are not. The ideology calls for what are called
flexible labor markets. Flexible labor markets is a fancy way of saying,
when you go to sleep at night you don't know if you'll have a job tomorrow
morning. That's a flexible labor market. That increases efficiency. Any
economist can prove that it increases efficient use of resources if people
have no job security, if you can get thrown out and somebody cheaper can
come in the next morning. That's the kind of market discipline that the
poor are to be subjected to. But the rich have all sorts of forms of
protection. This was dramatically illustrated at Clinton's great triumph at
the Asia Pacific summit, when he presented what the press called his grand
vision for the free market future. He picked as his model for the free
market future the Boeing Corporation, whose wealth and power derive
substantially from state intervention. That's protection for the rich.
                          -----------------------

                          Reflections on Democracy

                              April 11, 1994

DB: You just returned from the San Francisco Bay area where you had the
usual rounds of speeches, interviews, and receptions. Anything different
about this particular trip?

There was a noticeable effect of people having seen the Achbar-Wintonick
film Manufacturing Consent. Lots of people recognized me on campus and the
streets. Otherwise, it's similar to what I find around the country. It
takes a little different form in different places. It's a combination of
dismay ranging to hopelessness on the one hand and hunger for something to
do and some suggestion as to a way to proceed on the other.

DB: Are you concerned that this increased visibility and recognition might
inhibit you in some way?

It has a feature that I think is extremely unfortunate and that may
actually be inherent in the film medium and also in the general collapse of
a left intelligentsia, namely a tendency to personalize issues and to
impose a serious misunderstanding of the way things happen, as if they
happen because individuals show up and lead people, whereas in fact what
happens is that people organize and occasionally will toss up a
spokesperson.

DB: Let's talk about democracy. When democratic theorists talk about the
"rabble," who do they mean?

They mean the general population, who they in past years called the rabble
and in more recent years have called "ignorant and meddlesome outsiders."
If they're more polite, they call them the "general public."

DB: Why is it important to keep the rabble in line?

Any form of concentrated power, whatever it is, is not going to want to be
subjected to popular democratic control or, for that matter, to market
discipline. Powerful sectors, including corporate wealth, are naturally
opposed to functioning democracy, just as they're opposed to functioning
markets, for themselves, at least. It's just natural. They do not want
external constraints on their capacity to make decisions and act freely. It
entails that the elites will be extremely undemocratic.

DB: And has that always been the case?

Always. Of course, it's a little more nuanced because certain forms of
democracy are favored, what is sometimes called "formal democracy." Modern
democratic theory is simply more articulate and sophisticated than in the
past. It takes the view that the role of the public, the "ignorant and
meddlesome outsiders," as Walter Lippmann called them, is to be
"spectators," not "participants," who show up every couple of years to
ratify decisions made elsewhere or to select among representatives of
dominant sectors in what's called an election. That form of democracy is
approved and is indeed helpful to certain kinds of ruling groups, namely
those in more or less state capitalist societies, and indeed the rising
bourgeoisie a century or two ago. For one thing it has a legitimizing
effect, and for another, it does offer significant options for the more
privileged sectors, sometimes called the political class or the
decision-making sectors, maybe something like a quarter of the population
in a wealthy society.

DB: In discussions on democracy you refer to a couple of comments from
Thomas Jefferson.

Near the end of his life, (he died in 1826), and a little before that,
Thomas Jefferson had spoken with a mixture of concern and hope about what
had been achieved. This is roughly fifty years after the Declaration of
Independence. He said many interesting things. He made a distinction
between two groups, what he called "aristocrats" and "democrats." The
aristocrats are, in his words, "those who fear and distrust the people and
wish to draw all powers from them into the hands of the higher classes."
The democrats are those who "identify with the people, have confidence in
them, cherish and consider them as the most honest and safe, although not
the most wise depository of the public interest." So the democrats say,
Look, people must be in control, whether or not I think that they're going
to make the right decisions. The aristocrats fear and distrust the people
and say that the higher classes shall take all powers into their hands.

What he called the aristocrats include the modern intelligentsia, whether
in their Leninist variety or in the variety that appears in state
capitalist democracies. So those who warn us of the "democratic dogmatisms
about men being the best judges of their own interests" say that they are
not the best judges; we are. I'm quoting one of the founders of
contemporary political science, Harold Lasswell, representing a standard
view. They are what Jefferson called the aristocrats. Their view has a
close similarity to the Leninist doctrine that the vanguard party of
radical intellectuals should take power and lead the stupid masses to a
bright future. Those views run across the board in the groups that are
considered respectable intellectuals in their own societies. In fact this
is the victory of Thomas Jefferson's aristocrats, something which he feared
and hoped might not happen, but indeed did happen, not entirely in the
forms he predicted, but in the general character. These insights, of which
Jefferson was one of the earliest articulate spokespersons, continued
through the nineteenth century.

Later on Bakunin made a similar distinction, predicting that the
intellectual classes more or less becoming visible as an independent
element in the world would separate into two groups, those that he called
the "red bureaucracy," who would take power into their own hands and create
one of the most malevolent and vicious tyrannies in human history, and
those who would conclude that power lies in the private sector and would
become the intellectual servants of state and private power in what we now
call state capitalist societies and, in his term, would "beat the people
with the people's stick," meaning they would profess democracy while
serving as what were later called the "responsible men" (Lippmann) who
would make the decisions and the analysis and keep the "bewildered herd"
(Lippmann) in hand. Those are two categories of what Jefferson called
aristocrats. Democrats do exist, but they're increasingly marginal.

DB: You also cite the twentieth-century philosopher and educator John Dewey
in a kind of link with Jefferson. What did Dewey have to say about this
subject?

Dewey was one of the last spokespersons of what you might call the
Jeffersonian view of democracy. Of course, he was writing a century later.
Jefferson himself, some years before the remarks I quoted, warned of the
danger that the government would fall into the hands of what he again
called an aristocracy of "banking institutions and monied incorporations,"
what we would nowadays called corporations. He warned that that would be
the end of democracy and the defeat of the American revolution. That's
pretty much what happened in the century that followed, far beyond his
worst nightmares.

Dewey was writing in the early part of the twentieth century. His view was
that democracy is not an end in itself, it's a means by which people
discover and extend and manifest their fundamental human nature and human
rights, which is rooted in freedom and solidarity and a choice of both work
and other forms of participation in a social order and free individual
existence. Democracy produces free people, he said. That's the "ultimate
aim" of a democratic society; not the production of goods, but "the
production of free human beings associated with one another on terms of
equality." He recognized that democracy in that sense was a very withered
plant.

He described politics as "the shadow cast on society by big business,"
namely by Jefferson's "banking institutions and monied incorporations," of
course vastly more powerful by this time. He felt that that fact made
reform very limited if not impossible. Here are his words: As long as
"politics is the shadow cast on society by big business, the attenuation of
the shadow will not change the substance." So reform may be of some use,
but it's not going to bring democracy and freedom. These are undermined by
the very institutions of private power, which of course he recognized, as
did Jefferson and other classical liberals, as absolutist institutions.
They're unaccountable. They're basically totalitarian in their internal
structure. They're powerful far beyond anything that Dewey dreamed, for
that matter. He also spelled out exactly what they were. He made it quite
clear that as long as there is no democratic control of the workplace, of
the banking institutions and monied incorporations, there will be only the
most limited democracy.

DB: A question about your methodology and research. You retrieve and
resurrect very valuable material, for example on Jefferson and Bakunin and
Dewey and Adam Smith. There is that great St. Augustine story on pirates
and emperors that you use. When did you read St. Augustine on the
difference between pirates and emperors?

The St. Augustine story was actually brought to my attention by a friend,
Israel Shahak, the Israeli dissident. He mentioned that to me. It was a
nice story.

DB: Do you file these away? You dug out a quote from John Jay, "Those that
own the country ought to govern it." Where did you find that?

I read it somewhere.

DB: It's a very impressive service.

This literature is all accessible. Thomas Jefferson and John Dewey, for
example, it's hard to think of more leading figures in American history.
All of these things are as American as apple pie. When you read John Dewey
today, or Thomas Jefferson, their work sounds like that of some crazed
Marxist lunatic. But that just shows how much intellectual life has
deteriorated. These are straight developments from the classical liberal
period. In many ways they received their earliest, and often most powerful
formulation, in people like Wilhelm von Humboldt, somebody who I've been
greatly interested in, and who inspired John Stuart Mill.

Von Humboldt was one of the eighteenth-century founders of the classical
liberal tradition. He, like Adam Smith and other basically pre-capitalist
classical liberals, felt that at the root of human nature is the need for
free creative work under one's own control. That must be at the basis of
any decent society. Those ideas run straight through to Dewey. They are of
course deeply anti-capitalist in character. In the eighteenth century, Adam
Smith didn't speak of himself as anti-capitalist because this was
pre-capitalist, but you can see exactly where it's leading. It's leading to
the left-libertarian critique of capitalism, which in my view grows
straight out of classical liberalism and takes various forms. It takes the
Deweyian form of a sort of workers' control version of democratic
socialism. It takes the left Marxist form of people like Anton Pannekoek
and Rosa Luxemburg, and it feeds directly into the libertarian
socialist-anarchist tradition. All of this has been grossly perverted or
forgotten in modern intellectual life. I think that those traditions are
rich and internally fairly consistent, and I even think they can be traced
back to earlier origins in seventeenth-century rationalism.

DB: Let's take Adam Smith, for example. He of course is the icon celebrated
by the corporate community as the godfather of capitalism. But your
research reveals some very startling information about Adam Smith.

It's not really startling. It's well known in Smith scholarship. Recall
that Smith, for example, had even given an argument to show that a properly
functioning market will tend towards equality and that the perfect system
will be one of very extensive and pervasive equality. The closer you reach
equality the closer you reach a perfect society. He also argued that only
under those conditions would a market function efficiently. He was very
critical of what he called "joint stock companies," what we would call
corporations, which existed in quite a different form in his day. He had a
good deal of skepticism about them because of the separation of managerial
control from direct participation and also because they might, he feared
then, turn into, in effect, immortal persons, which indeed happened in the
nineteenth century, not long after his death.

It happened not through parliamentary decisions. Nobody voted on it in
Congress. This was a significant change in American society, and elsewhere
in the world as well, through judicial decisions. Judges, corporate
lawyers, and others, simply crafted a new society in which immortal
persons, namely corporations, have immense power. By now the top two
hundred corporations in the world control over a quarter of total assets,
and this is increasing. Just this morning Forbes magazine came out with its
annual listing of the top American corporations and their assets, their
behavior, and their welfare, and found increasing profits, increasing
concentration, and reduction of jobs, a tendency that's been going on for
some years.

DB: You suggest that to further democracy people should be "seeking out
authoritarian structures and challenging them, eliminating any form of
absolute power and hierarchic power." How would that, for example, work in
a family structure?

In any structure, including a family structure, there are various forms of
authority. A patriarchal family, that kind of family structure, may have
very rigid authority, from the father usually, setting rules that others
adhere to, in some cases administering severe punishment if there's a
violation of them. There are other hierarchical relations among siblings,
between the mother and father, gender relations, and so on. These all have
to be questioned. Sometimes I think you can find that there's a legitimate
claim to authority, that is, the challenge to authority can sometimes be
met. But the burden of proof is on the authority. So for example, some form
of control over children is justified. It's fair to prevent the child from
putting his or her hand in the oven, let's say, or from running across the
street in traffic. It's even proper to place clear bounds on children. They
want them. They want to understand where they are in the world. However,
all of these things have to be done with sensitivity and with
self-awareness and recognition that any authoritarian role that one plays,
or that someone else plays, does require justification. It's not
self-justifying.

DB: This is a difficult question. When does that child move to an
autonomous state where the parent doesn't need to provide authority?

I don't think there are formulas for this. For one thing, it's not that we
have solid scientific knowledge and understanding of these things. We
don't. There's a mixture of experience and intuition plus a certain amount
of study which yields a limited framework of understanding, about which
people may certainly differ. Beyond that there are plenty of individual
differences. So I don't think there's a simple answer to that question. The
growth of autonomy and self-control and expansion of the range of
legitimate choices and the ability to exercise them, that's growing up.

DB: Let's talk about media and democracy. In your view, what are the
communications requirements of a democratic society?

I would agree with Adam Smith on this. We would like to see a tendency
toward equality. Equality doesn't just mean the extremely spare form of
equality of opportunity that's considered part of the dominant value system
here. It means actual equality and the ability at every stage of one's
existence for access to information and choices and decisions and
participation on the basis of that information. So a democratic
communications system would be one that involves large-scale public
participation, that reflects on the one hand public interests and on the
other hand real values, like truth and integrity and discovery and so on.
Pursuit and dissemination of scientific understanding, for example, isn't
something that results from parliamentary choices. It does in part because
of funding and so on, but it also pursues its own path. And it's pursuing
values that are significant in themselves.

DB: Bob McChesney, in his recent book Telecommunications, Mass Media and
Democracy, details the rather contentious debate between 1928 and 1935 for
control of radio in the U.S. How did that battle for radio play out?

That's a very interesting topic, and he's done an important service by
bringing it out. It's very pertinent today, because we're involved in a
very similar battle over this so-called "information highway." In the
1920s, the first major means of mass communication came along after the
printing press, which was radio. It's obvious that radio is a bounded
resource. There was no question in anyone's mind that the government was
going to have to regulate it. There's only a fixed bandwidth. The question
was, What form would this government regulation take?

There were essentially two choices: It could offer this new technology,
this new form of mass communication, as, in effect, a public service,
meaning that it would be public radio, with popular participation, and as
democratic as the society is. Public radio in the Soviet Union would have
been totalitarian, and public radio in, say, Canada or England would be
partially democratic insofar as the societies are democratic, which they
are to an extent. That debate was pursued all over the world, at least in
the wealthier societies that had choices, and it split.

The U.S. went one way, and the rest of the world, maybe all of it, I can't
think of an exception, went the other way. Almost the entire world went in
the direction of public radio. The U.S. chose private radio. "Chose" is a
funny word. The distribution of power in the U.S. led to commercialization
of radio. Not a hundred percent, so you were allowed to have small radio
stations, say, a college radio station, which can reach a few blocks. But
in effect it was handed over to private power. There was, as McChesney
points out, a considerable struggle about that. There were church groups
and some labor groups and other public interest groups that felt that the
U.S. should go the way the rest of the world was going. They lost out. This
is very much a business-run society. That shows itself in many differences
between the U.S. and the rest of the industrial world. Lack of
comprehensive health care is another well-known example.

In any event, business power won. Rather strikingly, it also won an
ideological victory, claiming that handing radio over to private power was
democracy because you have choices in the market. That's a very weird
concept of democracy, which means that your power in this democracy depends
on the number of dollars you have, and the choices are limited to selection
among options that are highly structured by the real concentration of
power. So it's a very odd notion of democracy, sort of the kind of
democracy you get in a totalitarian system. But nevertheless that was
considered democracy. It was widely accepted, including by liberals, as the
democratic solution. By the mid- and late 1930s that game was essentially
over.

It replayed, in the world, at least, about a decade later, when television
came along. In the U.S. this wasn't a battle at all. It was completely
commercialized without any conflict. But again in the rest of the world,
maybe in the entire rest of the world, it moved into the public sector,
again a big split between the U.S. and other countries. There was a slight
modification of this in the 1960s. For one thing, television and radio were
becoming by then partly commercialized in other societies, too, as an
effect of the same concentration of private power that we find in the U.S.
So it was chipping away at the public service function of radio and
television. In the U.S. in the 1960s there was a slight opening to public
radio and television. The reasons for this have never been explored in any
depth, as far as I know, but what seems to have happened is that
corporations recognized that it was a nuisance for them to have to satisfy
the formal requirements of the Federal Communications Commission that they
devote part of their functioning to public interest purposes. So CBS and so
on would have to have a big office with a lot of employees and bureaucrats
who every year would put together a collection of fraudulent claims about
how they had met this legislative condition. That's just a pain in the
neck. Presumably they decided at some point that it would be easier to get
the entire burden off their backs and permit a small and underfunded public
broadcasting system. They could then claim that they don't have to fulfill
this service any longer. That's what happened. So you get public radio and
public television, small, underfunded, and by now largely corporate-funded
in any event.

DB: That's happened more and more. PBS is sometimes called Petroleum
Broadcasting Service.

That's again a reflection of the interests and power of a highly
class-conscious business system which is always fighting an intense and
self-conscious class war. These issues are coming up again in the decisions
that are going to be made about the new communications technology, the
Internet, the interactive technologies that are being developed and so on.
And again we're going to find exactly the same conflict. It's going on
right now.

DB: Lorenzo Milam is one of the pioneers of community radio in the U.S. He
had this to say about public broadcasting: "Our freedom to be heard has
been replaced on radio by mindless call-in programs, endless repeats of the
car culture by illiterate Bostonians," sorry, Noam, "and national news
programs ground out like commercial sausage. On television, any access by
the poor and dispossessed is replaced by lions eating wildebeests, Lawrence
Welk, and hour-long programs dedicated to the wonders of theme parks. Those
of us who once hoped that commercial radio and television would live up to
their initial hopes now have to be satisfied with the exposure of our most
lurid preoccupations on the likes of Oprah, Geraldo, Arsenio, sandwiched
between the prime-time ritual murder of our children."

I don't see any reason why one should have had any long-term hopes for
anything different. Commercially run radio is going to have certain
purposes, namely the purposes designed and determined by those who own and
control it. Their purposes are to have a passive, obedient population of
spectators in the political arena, not participants, consumers in the
commercial arena, certainly not decision makers and participants, a
community of people who are atomized and isolated so they cannot organize
to put together their limited resources so as to become an independent and
powerful force that will chip away at concentrated power. That's exactly
what private business power will naturally want. From that you can pretty
well predict the kind of system that will emerge.

DB: Does ownership always determine and drive content?

In some far-reaching sense it does. That is, if content ever goes beyond
the bounds that ownership will tolerate, it will surely move in to limit
it. On the other hand, that permits a fair amount of flexibility. So
investors don't go down to the television studio and make sure that the
local talk show host or news director is doing what they want. On the other
hand, there are other complex mechanisms which make it fairly certain that
they will do what the owners and investors want. There's a whole filtering
process that enables people to rise through the system into managerial
roles only if they've demonstrated that they've successfully internalized
the values demanded by private power.

At that point they can describe themselves as quite free. So you'll
occasionally find the sort of flaming independent liberal type. I remember
columns by Tom Wicker saying, Look, nobody tells me what to say. I do
anything I feel. It's an absolutely free system. And for him that's just
right. After he had demonstrated to the satisfaction of the bosses that he
had internalized their values, he was entirely free to write anything he
wanted.

DB: Within the ideological framework, both PBS and NPR frequently come
under attack as being left-wing.

This is an interesting sort of critique. The fact is that they are elite
institutions, reflecting by and large the points of view and interests of
wealthy professionals who are very close to business circles, including
corporation executives. Their circles happen to be liberal by certain
criteria. That is, if you took a poll among corporation executives on
matters like, say, abortion rights, I've never seen this done, but I
presume that they would be together with what's called the liberal
community. The same on lots of social issues. They would tend not to be
fundamentalist, born-again Christians, for example. They might tend to be
more opposed to the death penalty than the general population. You'll find
the wealthy and the privileged, including CEOs of corporations and big
investors and so on, at the liberal fringe on a whole series of issues. The
same will be true on things like civil rights and freedom of speech, I
suspect. Since those are aspects of the social order from which they gain,
they will tend to support them. If you look at support for the American
Civil Liberties Union, I'm sure you'll find plenty of private wealth
backing it. So by these criteria, by these standards, the powerful elites
who basically dominate the country and own it tend to be liberal. That
reflects itself in an institution like PBS.

DB: You've been on National Public Radio twice in twenty-three years, on
MacNeil-Lehrer once in its almost twenty years. What if you were on
MacNeil-Lehrer ten times? Would it make a difference?

Not a lot. I'm not quite sure of those numbers. I don't know where they
come from, and my own memory is not that precise. For example, I've been on
local PBS stations in particular towns.

DB: I'm talking about the national network.

Probably something roughly like that is correct. I don't know the exact
numbers. It wouldn't make a lot of difference. In fact, in my view, if the
managers of the propaganda system were more intelligent, they would allow
more leeway to real dissidents and critics. Because it still wouldn't make
much of a difference, given the overwhelming weight of propaganda on the
other side and the constant framing of issues, even in the news stories and
in that huge mass of the media system that is simply devoted to diverting
people and making them more stupid and passive. It would also give the
impression of broader debate and discussion and hence would have a
legitimizing function. That's not to say I'm against opening up these media
a bit, but I would think it would have a limited effect.

What you need is something that presents every day, in a clear and
comprehensive fashion, a different picture of the world, one that reflects
the concerns and interests or ordinary people, that takes something like
the point of view on democracy and participation that you find from people
like Jefferson or Dewey. Where that happens, and it has happened, even in
modern societies, it has effects. Let's say, in England, where up until the
1960s you did have major mass media of this kind. It helped sustain and
enliven a working-class culture, which had a big effect on British society.

DB: In 1990 we did one of our many interviews. We had a brief discussion
about the role and function of sports in American society. I've probably
gotten more comments about your comments than practically anything else.
Part of it was excerpted in Harper's. You really pushed some buttons on
this issue of sports. What's that about?

I got some funny reactions, a lot of irate reactions, as if I were somehow
taking people's fun away from them. I have nothing against sports. I like
to watch a good basketball game and that sort of thing. On the other hand,
we have to recognize that there is a role that this mass hysteria about
spectator sports plays. It's a significant role. It plays a role first of
all in making people more passive, because you're not doing it. You're
watching somebody doing it.

Secondly, it plays a role in engendering jingoist and chauvinist attitudes,
sometimes to quite an extreme level. I saw something in the newspapers just
a day or two ago about how high school teams are now so antagonistic and
passionately committed to winning at all costs that they can't even do
civil things like greeting one another because they're ready to kill one
another. So they had to abandon the standard handshake before or after the
game.

Those are the things that spectator sports engender, particularly when
they're designed to organize a community to be hysterically committed to
their gladiators. That's very dangerous, and it has lots of deleterious
effects. Furthermore, I think things like that are understood and are part
of the planning system, part of the public relations control system.

I was reading something about the glories of the information highway not
too long ago. I can't quote it exactly, but I'll paraphrase the general
tone. It was talking about how wonderful and empowering it's going to be
with these new interactive technologies. Two basic examples were given. For
women, what it's going to offer is highly improved methods of home
shopping. So you'll be able to watch the tube and some model will appear
with a commodity and you're supposed to think, God, I've got to have this
or my children won't go to college, or whatever the reasoning is supposed
to be. So you press a button and they deliver it to your door within a
couple of hours. That's interactive technology liberating women. On the
other hand, for men the example that was given was the Superbowl. Every
red-blooded American male in the country is glued to it. Now all they can
do is watch and cheer and drink beer. But once we have interactive
technology, they can be asked, while the quarterback is getting his
instructions from the coach about the next play, what the play ought to be.
He should throw a pass, or something. They will be able to punch that into
their computer and it will go to some central location. It won't have any
effect on what the quarterback does, but after the play the television
channel will be able to put up the numbers, sixty-three percent say he
should have passed. That's interactive technology for men. Now you're
really participating in the world. Forget about all this business of
deciding what ought to happen for health care. Now you're doing something
really important: deciding what play the quarterback should have called.
That reflects the understanding of the stupefying effect of these systems
in making people passive, atomized, obedient, non-participants,
non-questioning, and easily controlled and disciplined.

DB: You also have, at the same time, the lionization of these athletes, or,
in the case of Tonya Harding, for example, the demonization.

If you can personalize events, whether it's Hillary Clinton or Tonya
Harding, you are directing people away from what matters and what is
important. The John F. Kennedy cult is a good example, with the effects
that that's had on the left.

DB: You were at American University in Washington, D.C. in December 1993. A
student got up and said, Isn't it just great? We now have all these
computer bulletin boards and the opportunity to be on e-mail and expand our
information and awareness, etc. I was very struck by your response. You
were talking about our need to have more human contact and that there was a
danger in the new technologies.

I think that there are good things about these Internet communications.
There are also aspects of them that concern and worry me. These are
intuitive responses. I can't prove it. But my feeling is that people are
not Martians, they are not robots, and that direct human contact, and I
mean by that face-to-face contact, is an extremely important part of human
life and existence and developing self-understanding and the growth of a
healthy personality and so on. You just have a different relationship to
somebody when you are looking at them than when you're punching away at a
keyboard and some symbols come back. Extending that form of abstract and
remote relationship, instead of direct personal contact, I suspect that
that's going to have unpleasant effects on what people are like. It will
diminish people, I think.

DB: Let's move on to another area. Historian Paul Boyer, in his book When
Time Shall Be No More, writes, "Surveys show that," and I find this
absolutely stunning, "from one third to one half of the population," he's
talking about Americans, "believes that the future can be interpreted in
biblical prophecies." Have you heard of these things?

I haven't seen that particularly number, but I've seen plenty of things
like it. I saw a cross-cultural study a couple of years ago, I think it was
published in England, which compared a whole range of societies in terms of
beliefs of that kind. The U.S. stood out. It was unique in the industrial
world. In fact, the measures for the U.S. were similar to pre-industrial
societies.

DB: Why is that?

That's an interesting question, but it's certainly true. It's a very
fundamentalist society. It's like Iran in the degree of fanatic religious
commitment. You get extremely strange results. For example, I think about
seventy-five percent of the population has a literal belief in the devil.
There was a poll several years ago on evolution. People were asked their
opinion on various theories of evolution, of how the world came to be what
it is. The number of people who believed in Darwinian evolution was less
than ten percent. About half the population believed in a church doctrine
of divine-guided evolution. Most of the rest presumably believed that the
world was created a couple of thousand years ago. This runs across the
board. These are very unusual results. Why the U.S. should be off the
spectrum on these issues has been discussed and debated for some time.

I remember reading something by a political scientist who writes about
these things, William Dean Burnham, maybe ten or fifteen years ago. He had
also done similar studies. He suggested that this may be a reflection of
depoliticization, that is, inability to participate in a meaningful fashion
in the political arena, which may have a rather important psychic effect,
heightened by the striking disparity between the facts and the ideological
depiction of them. What's sometimes called the ideal culture is so
radically different from the real culture in terms of the theory of popular
participation versus the reality of remoteness and impotence. That's not
impossible. People will find some ways of identifying themselves, becoming
associated with others, taking part in something. They're going to do it
some way or other. If they don't have the options of participation in labor
unions, political organizations that actually function, they'll find other
ways. Religious fundamentalism is a classic example.

We see that happening in other parts of the world right now. The rise of
what's called Islamic fundamentalism is to a significant extent a result of
the collapse of secular nationalist alternatives which were either
discredited internally or destroyed, leaving few other options. Something
like that may be true of American society. This goes back to the nineteenth
century. In fact, in the nineteenth century you even had some conscious
efforts on the part of business leaders to promote and encourage fire and
brimstone-type preachers who would lead people into looking in another way.
The same thing happened in the early part of the Industrial Revolution in
England. E.P. Thompson writes about this in his classic The Making of the
English Working Class.

DB: What is one to make of Clinton's comment in his recent State of the
Union speech. He said, "We can't renew our country unless more of us, I
mean all of us, are willing to join churches."

I don't know exactly what's in his mind, but the ideology is very
straightforward. If you devote yourself to activities out of the public
arena, we folks will be able to run it straight. It's very interesting to
see the way this is done in the slick PR productions of the right-wing
corporations. One of the biggest ones is the Bradley Foundation, which is
devoted to trying to narrow still further the ideological spectrum that
shifted to the right in the schools and colleges and the ideological
institutions generally in the 1980s, in part as a result of dedicated
ideological warfare by the business sector. That's their mission. Their
director, Michael Joyce, recently published an article on this which I
found fascinating. I don't know whether he wrote it or one of his PR guys.
It was very revealing in this respect, done in a very slick fashion.

It starts off with rhetoric drawn, probably consciously, from the left.
When left liberals or radical activists start reading it they get a feeling
of recognition and sympathy. I suspect it's directed to them and to young
people. It starts off talking about how remote the political system is from
us, how we are asked just to show up every once in a while and cast our
votes and then go home. This is meaningless. This isn't real participation
in the world. What we need is a functioning and active civil society in
which people come together and do important things and not just this
business of pushing a button now and then. That's the way it's starts. Then
you get to page 2. It says, "How do we overcome these inadequacies."

Strikingly, the inadequacies are not to be overcome by more active
participation in the political arena. They're to be overcome by abandoning
the political arena and joining the PTA and going to church and getting a
job and going to the store and buying something. That's how you fulfill
your function as a citizen. That's the way to become a real citizen of a
democratic society, by becoming engaged in activities like finding a job
and going to the PTA.

Nothing wrong with going to the PTA. But there are a few gaps here. What
happened to the political arena? That disappears from the discussion after
the first few comments about how meaningless it is. Of course, if you
abandon the political arena, somebody is going to be there. The somebody
who is going to be there is the missing element in the entire discussion --
namely, private power, corporations. They're going to be there. They're not
going to go home and join the PTA. So they're going to be there and they're
going to run it. Nothing is said about this. This is abandoned.

As the discussion continues, there is some reference to the political arena
and the way the people in it are oppressing us. But who are the people who
are oppressing us? The liberal bureaucrats, the social scientists, the
people who are trying to design social programs. They're the ones who run
the country. They're ordering us around and kicking us in the pants and
we've got to defend ourselves from them and so on. So there is a form of
external power, namely, English departments somewhere or bureaucrats
administering the IRS or social planners who are trying to talk about doing
something for the poor. They're the ones who are really running the
society. They're that impersonal, remote, unaccountable power that we've
got to get off our backs as we go to the PTA and look for a job and in such
ways fulfill our obligations as citizens.

Meanwhile the real public arena and the real centers of power in the
country are totally missing from the discussion. This is done not quite
step-by-step. I'm collapsing it. When you go through you see very clever
propaganda, well-designed, well-crafted, plenty of thought behind it. Its
goal, surely, is to make people as stupid and ignorant as possible and also
as passive and obedient as possible, while at the same time making them
feel that they are somehow moving towards higher forms of participation by
abandoning the public arena. It also serves the crucial role of displacing
attention from actual power. This is the kind of thing that really can't be
achieved in a totalitarian state, where central power is just too visible.
But it's achieved very commonly in the U.S. This is the right wing.

You see it at the liberal extreme, too. The campaign literature of the
Clinton administration was interesting, since you mentioned Clinton. They
put out a book called Mandate for Change, the kind of thing you pick up at
airport newsstands for twenty-five cents, right before the election. We've
talked about it before, but it's worth recalling in this context, to
illustrate the actual breadth of the spectrum in a business-run society. It
was about what great things they were going to do. The first chapter was on
entrepreneurial economics and all their great plans for this. They
explained that they're not going to be old-fashioned tax-and-spend
liberals. They realize what's wrong with that. On the other hand, they're
not going to be hard-hearted Republicans. They're forging a new path,
entrepreneurial economics, which is concerned just for working people and
their firms. The Clinton Administration is going to do something for them.
The word "profits" appears once, I think, namely in a reference to the bad
days when the Republicans were trying to make too much profit. The word
"bosses" doesn't appear. "Managers" doesn't appear. "Owners" and
"investors" don't appear. They're not there. It's just the workers and the
firms in which they work, their own firms. What about the entrepreneurs?
They're there. The entrepreneurs are people who come in every once in a
while and help out the workers and improve the firms in which they work and
then apparently disappear. That's the picture. Here's the workers and their
firms and the entrepreneurs helping them now and then and the Clinton
administration coming in to benefit them. The actual structure of power and
authority is totally missing, just as much as it is in the publication of
the Bradley Foundation. This makes sense if you're trying to turn people
into passive and obedient automata.

DB: To tie up this discussion about religion and irrational belief and
state capitalism, I recently read an article on MITI, the Ministry of
International Trade and Industry in Japan. There was a fascinating
discussion by a MITI bureaucrat who was trained in the U.S. at the Harvard
Business School. He says his class at Harvard was studying a failed
airline, maybe Eastern or Pan Am, that went out of business. The class was
shown a taped interview with the company's president, who noted with pride
that through the whole financial crisis and eventual bankruptcy of the
airline he had never asked for government help. The class, the Japanese man
recalls with astonishment, erupted into applause. Then he says, "There's a
strong resistance to government intervention in America. I understand that.
But I was shocked. There are many shareholders in companies. What happened
to his employees, for example?" Then he reflects on what he views as
America's blind devotion to a free-market ideology. He says, "It is
something quite close to a religion. You cannot argue about it with most
people. You believe it or you don't." It's interesting.

It's interesting in part because of the failure to understand what happens
in the U.S., which may well be shared by the students in his business
class. If that was Eastern Airlines that they were talking about, Frank
Lorenzo, the director, was in fact trying to put it out of business. He
made a personal profit out of that, but he wanted to break the unions and
to support his other enterprises, which he ripped off profits from Eastern
Airlines for to leave the airline industry less unionized and more under
corporate control and to leave himself wealthier, all of which happened. So
naturally he didn't ask for government intervention because it was working
the way he wanted. On the other hand, the belief that corporations don't
call for government intervention is a joke. They demand government
intervention and government power at an extraordinary level. The Chrysler
bailout is a famous example, but a minor one. That's largely what the whole
Pentagon system is about.

Take the airline industry. It was created by government intervention. A
large part of the reason for the huge growth in the Pentagon in the late
1940s was to salvage the collapsing aeronautical industry, which obviously
couldn't survive in a civilian market. There's an interesting and important
book by Frank Kofsky which just came out on this, running through the
details of the war scares that were manipulated in 1947 and 1948 to try to
ram spending bills through Congress that would save the aeronautical
industry. It's not the only thing they were for, but it was a big factor.
That's continued. The aeronautical industry is the leading American export
industry. Boeing is the leading American exporter without government
intervention it might be producing one-seaters for sport.

Furthermore, the real U.S. comparative advantages in what's called
"services." About a third of the trade benefits and services are
aeronautical related, things like tourism, travel, and so on. These are
huge industries spawned by massive government intervention and maintained
that way. The corporations demand it. They couldn't survive without it,
even if for some of them it's not a huge part of their profits right now.
But it's a cushion. And the public also provides the basic technology,
metallurgy, avionics, and so on, via the public subsidy system. The same is
true just across the board. You can't find a functioning sector of the
American economy which hasn't gotten that way and isn't sustained that way
by state intervention. Just a day or two ago the lead story in the Wall
Street Journal was about how the Clinton administration is reviving the
National Bureau of Standards and Technology and pouring new funds into it
to try to replace the somewhat declining Pentagon system. It's harder to
maintain the Pentagon, but you've got to keep the subsidy going to big
corporations. You have to have the public pay the research and development
costs. So they're shifting over to the National Bureau of Standards, which
used to try to work out how long a foot is and will now be more actively
involved in serving the needs of private capital. It describes how hundreds
of corporations are beating on their doors asking for grants. The idea that
a Japanese investigator could fail to see this is pretty remarkable. It's
pretty well known in Japan. And it's hard to imagine that they don't teach
it in business school.

DB: I remember you telling me about when you were a kid in Philadelphia,
the first baseball game you ever attended. The Philadelphia Athletics were
playing the New York Yankees. Tell me about that, if you don't mind.

I can still remember it. It must have been around 1937, I guess. My closest
friend and I were taken to this game by the fourth-grade teacher, whose
name was Miss Clark and who we were madly in love with. It was a great
occasion. Not only were we being taken to our first baseball game, but Miss
Clark was taking us. We sat in the bleachers, the cheap seats, in center
field, right behind Joe DiMaggio and the A's equivalent star, whose name I
think was Bob Johnson. We were naturally rooting for the home team, the
Philadelphia A's, who were winning 7-3 going into the seventh inning when
the Yankees had a seven-run explosion and won the game 10-7. Big disaster,
except that we saw all of our heroes, Joe DiMaggio, Lou Gehrig, Red Ruffing
and the rest of them. I can remember it pretty clearly.

DB: The A's were always losing in those years, right?

For a boy growing up in Philadelphia in those years, given the way the
culture works, they were hard times. Not only the A's, but every team in
Philadelphia was always losing. So we were an object of considerable
mockery when we met our friends and cousins from New York, where they were
always winning. I have a certain suspicion that young boys who grew up in
Philadelphia in those days must have a kind of deep inferiority complex.

DB: Things got so bad for the Athletics that they eventually left town.

So I heard. After my day.
                          -----------------------

                                Health Care

                                May 2, 1994

DB: So I guess you're finished with the sports pages and ready to get into
a day's work.

Only some of the sports pages. There's still the weeklies. (chuckles)

DB: It's becoming increasingly difficult to do interviews with you. That's
because I don't know where we left off in conversations that we have and
what we've talked about during interviews. So sometimes there's this
blurring. Do you do all these interviews in your office upstairs in your
home?

They're mostly here. Sometimes people come to my office at work, the ones
with television cameras and stuff.

DB: I don't suppose you can see the Boston skyline from your home in
Lexington. But if you could, do you know the two tallest buildings in
Boston?

Yes.

DB: What are they?

The John Hancock and the Prudential.

DB: And what does that tell you? They happen to be two types of what?

They're going to be running our health program if Clinton has his way.

DB: There is a general consensus that the U.S. health care system needs to
be reformed. How and why did that evolve?

It evolved very simply. Healthcare is never fully privatized. It can't be.
It's not a commodity. But on the spectrum we have a relatively privatized
health system. As a result it's hopelessly inefficient and extremely
bureaucratic, with huge administrative expenses, and it's geared towards
high-tech intervention rather than public health, prevention, and so on.
It's just gotten too costly for American business. In fact, a little bit to
my surprise, Business Week, the main business journal, has come out
recently with several articles advocating a Canadian-style national
government insurance program, what we call a single-payer program.

DB: What is that Canadian-style single-payer program?

The Canadian style is one of various plans that exist around the industrial
world. It's basically a government insurance program. Health care is still
individual, but the government is the insurer.

DB: The Clinton plan is called "managed competition." The big insurance
companies are backing it in one form or another. What is managed
competition and why are the big insurance companies supporting it?

Managed competition essentially will drive the little insurance companies
out of the market, which is why they're opposed to it. It will mean that
the big insurance companies will put together big conglomerates of health
care institutions, hospitals, and clinics, labs, and so on. They will be in
charge of organizing your health care. Various bargaining units will be set
up to determine which of these conglomerates to work with. That's supposed
to introduce some kind of market forces. But in effect, the big insurance
companies will be pretty much running the show. It means an oligopolistic
system, a very small number of big conglomerates in limited competition
with one another and doubtlessly micromanaging health care, because they're
business operations, they're in business for profit, not for your comfort.

DB: According to a Harris poll, Americans prefer, by a huge majority, the
Canadian single-payer health-care system. Those results are kind of
remarkable, given the minimal amount of media attention.

Polls, of course, depend on exactly how the question is asked. But there
have been some surveys of polls over the years. The best work on this that
I know is by Vicente Navarro. Have you ever interviewed him on this? You
should if you haven't. He's extremely good.

DB: Yes. He's at Johns Hopkins.

He's done a lot of work on this. He has among other things surveyed many
poll results. He has pointed out that even putting aside the variations
depending on phrasing, there has been quite consistent support for
something like a Canadian-style system ever since polls began on this
business, which is now over forty years ago. In fact, Truman tried to put
through such a program in the 1940s that would have brought the U.S. into
line with the rest of the industrial world. It was beaten back by a huge
corporate offensive with tantrums about how we were going to turn into a
Bolshevik society and so on. Every time the issue has come up there has
been a major corporate offensive. Occasionally it fails. One of Ronald
Reagan's great achievements back in the late 1960s was to read the messages
written for him by the insurance companies over radio and television about
how if Medicare was passed we would all be telling our children and
grandchildren decades hence what freedom used to be like.

DB: David Himmelstein and Steffie Woolhandler also cite another poll
result: When Canadians are asked if they would want a U.S.-style system,
only five percent say yes.

By now, even the business community doesn't want it. It's just too
inefficient, too bureaucratic and too costly for them. The auto companies
estimated a couple of years ago that it was costing them about $500 extra
per car just because of the inefficiencies of the U.S. health system, as
compared with, say, their Canadian operations. When business starts to get
hurt, then the thing moves into the public agenda. The public has been in
favor of a big change for a long time.

The public is sufficiently out of the political system so it doesn't matter
much. There's a nice phrase about this sort of thing in a recent issue of
the London Economist, the British business journal. It was about Poland.
Their constituency is apparently worried about the fact that Poland has
degenerated into this system where they have democratic elections, which is
sort of a nuisance. The populations of all the East European countries are
being smashed by the economic changes called "reforms" -- that's supposed
to make them sound good -- that are being rammed down their throats. The
Poles are opposed to the reforms. They voted in an anti-reform government.
The Economist pointed out that this really wasn't too troublesome because
"policy is insulated from politics." And that's a good thing. That's the
way it is here, too. Policy is insulated from politics. People can have
their opinions. They can even vote if they like. But policy goes on its
merry way, determined by other forces.

DB: You have commented on another term, called "politically unrealistic."

What the public wants is called "politically unrealistic," meaning, when
you translate that into English, that the major centers of power and
privilege are opposed to it. A change in the health care system is now
politically realistic because major systems of power, including the U.S.
corporate community, want a change, since it's harming them. As I
mentioned, it's striking that even Business Week, representing large
sectors of the corporate community, wants to go over to a Canadian-style
system because even the residual inefficiencies and expenses of the
Clinton-style system will also, they assume, be harmful to them.

DB: Vicente Navarro says that a universal and comprehensive health care
program is "directly related to the strength of the working class and its
political and economic instruments."

That's certainly true of the Canadian and European experience. Take Canada,
which had a system rather like ours up until the mid-1960s. It was changed
first in one province, Saskatchewan, where there was a fairly strong
labor-based NDP (New Democratic Party) government. It was able to put
through a provincial insurance program, driving the insurance companies out
of the business. It turned out to be very successful, very effective. It
was giving good medical care and reducing costs and much more progressive
in payment. That's a crucial fact. It was mimicked by other provinces, also
under labor pressure, often through the NDP as an instrument. It's a this
kind of umbrella political party with a mildly reformist character and
labor backing. Pretty soon it was adopted across Canada nationally.

The history in Europe is pretty much the same. Working-class organizations
have been one of the main, but not the only, mechanisms by which people
with very limited power and resources can get together to participate in
the public arena. That's one of the reasons why unions are so hated by
business and elites generally. They're just too democratizing in their
character. And Navarro is surely right: The history has been that the
strength and organization of labor and its ability to enter into the public
arena is certainly related, maybe even decisively related, to an
institution of social programs of this kind.

DB: There may be a parallel movement going on in the U.S. today. In
California there's a ballot initiative to have single-payer health care.

There are several states that are toying with it. This is still very much a
business-run society. Here business is still playing an inordinate role in
determining the kind of system that will evolve. Unless there are
significant changes inside the U.S., that is, unless public pressures and
organizations mount well beyond what we now see, including labor, the
outcome of this will once again be determined by business interests.

DB: I'm not quite clear about how to formulate this question. It has to do
with the nature of U.S. society as exemplified in such comments as "Do your
own thing," "Go it alone," "Don't tread on me," "the pioneer spirit," all
that deeply individualistic stuff. What does that tell you about American
society and culture?

It tells you that the propaganda system is working full-time, because there
is no such ideology in the U.S. Business, for example, doesn't believe it.
It has always insisted upon a powerful interventionist state to support its
interests -- still does and always has -- back to the origins of American
society. There's nothing individualistic about corporations. Those are big
conglomerate institutions, essentially totalitarian in character, but
hardly individualistic. Within them you're a cog in a big machine. There
are few institutions in human society that have such strict hierarchy and
top-down control as a business organization. Nothing there about "Don't
tread on me." You're being tread on all the time. The point of the ideology
is to try to get other people, outside of the sectors of coordinated power,
to fail to associate and enter into decision-making in the political arena
themselves. The point is to atomize everyone else while leaving powerful
sectors integrated and highly organized and of course dominating resources.

That aside, there is another factor. There is a streak of independence and
individuality in American culture which I think is a very good thing. This
"Don't tread on me" feeling is in many respects a healthy one. It's healthy
up to the point where it atomizes and keeps you from working together with
other people. So it's got its healthy side and its negative side. It's the
negative side that's emphasized naturally in the propaganda and
indoctrination.

DB: Have you thought about why the U.S. is such a violent society?

The U.S. does have many different features than other societies. Part of it
is just that it is relatively weak in terms of social and community bonds.
So if you travel around Europe, for example, you find that for one thing
mobility is simply far lower. People are much more likely to be where they
grew up, to be living and working pretty near to where they were. The
countries themselves are small by U.S. standards. Moving across borders is
much less likely than moving from one place to another in the U.S. But even
within a country people tend, I've never seen statistics on this but you
see it traveling around, much more than here to be part of ongoing,
continuing communities.

Here societies have been very much broken up. Furthermore, communities have
simply been dissolved. The forms of organization that do bring people
together to work together, like unions, are quite weak in the U.S. The main
ones that survive are churches. I think that that has a highly disruptive
effect, along with the ideology that you mentioned earlier. The ideal is,
get what you can for yourself. That's the ideal that's drummed into
people's heads. Bayard Rustin, the civil rights activist, made a point
about this back in the early 1960s, when he was asked about why black kids
were stealing cars. He said, That's what they're told to do every day on
television. They are told all the time that what you're supposed to do is
maximize your own consumption any way you can. So they're doing it. Those
are the options available to them. They don't have the options that are
available to relatively privileged white kids, namely, go to work in a
corporate law firm and rip people off that way. So they're ripping people
off in ways that are open to them. But they're basically following the
ideology that's not only presented but drummed into your head day and
night: maximize your own consumption and don't care about anyone else.

DB: And you have the attending media focus on symptoms rather than the
causes. Do you know what "smash and grab" is? This is something I
discovered last night watching TV news from Chicago. When your car is in
traffic or at a stop light, people come along and smash in the window and
grab your purse or steal your wallet.

Right around Boston the same thing is going on. There's a new form. It's
called "Good Samaritan robbery." You fake a flat tire on the highway and
when somebody stops, jump them, steal their car, beat them up, if they're
lucky. If they're unlucky you kill them and take the car off.

There's again a good deal of focus on the symptoms. The causes are
deep-seated. For one thing, there are social causes that we've just been
barely alluding to, but there are much more immediate causes. One is the
increasing polarization of the society that's been going on for the past
twenty five years and the marginalization of large sectors of the
population who are simply being rendered superfluous. They're superfluous
for wealth production, meaning profit production, and hence have no human
value, since the basic ideology is that a person's human rights depend on
what they can get for themselves in the market system.

Larger and larger sectors of the population are simply excluded and have no
form of organization or no viable, constructive way of reacting and
therefore pursue the available options, which are often violent. Indeed,
those are the ones that are encouraged to a large extent in the popular
culture.

DB: It's not just the underclass. A recent Census Bureau report stated that
there has been a fifty percent increase in the working poor, that is,
people who have jobs and are nonetheles below the poverty level.

That's part of the Third Worldization of the society. It's not simply
unemployment, but also wage reduction. Wages have been either stagnating or
declining, actually declining, since the late 1960s. In the Reagan years
they declined. Since 1987 real wages have been declining for
college-educated people, which was a striking shift. There is supposed to
be a recovery going on. There is a kind of recovery going on, that's true.
It's at about half the rate of normal postwar recoveries. Job creation
during this recovery is less than a third of the rate of preceding postwar
recoveries from recession. There have been half a dozen of them.

Furthermore, the jobs themselves are, out of line with any other recovery,
low-paying jobs. Wages are not going up. In addition, a huge number of them
are temporaries, again out of line with earlier history. This is what's
called "increasing flexibility of the labor market." "Flexibility" is like
"reform." It's supposed to be a good thing.

Flexibility means insecurity. It means you go to bed at night and don't
know if you have a job tomorrow morning. That's called flexibility of the
labor market, and any economist can explain that's a good thing for the
economy, where by "the economy" now we understand profit-making. We don't
mean by "the economy" the way people live. That's good for the economy, and
temporary jobs increase flexibility. Low wages also increase job
insecurity. They keep inflation low. That's good for people who have money,
say, bondholders. So these all contribute to what's called a "healthy
economy," meaning one with very high profits. Profits are doing fine.
Corporate profits are zooming. But for most of the population, very grim
circumstances. And grim circumstances, without much prospect for a future,
may lead to constructive social action, but where that's lacking they
express themselves in violence.

DB: It's interesting that you should say that. Most of the examples of mass
murders are in the workplace. I'm thinking of the various post office
killings and fast food restaurants where workers are disgruntled for one
reason or another or have been fired or laid off.

Not only have real wages stagnated or declined, but working conditions have
gotten much worse. You can see that just in counting hours of work. Today
we happen to be talking on May 2. Yesterday was May 1, which throughout the
world has been a working-class holiday, everywhere except in the United
States. May Day was initiated in solidarity with American workers who were
suffering unusually harsh conditions in their effort to achieve an
eight-hour day. This was back in the 1880s. The efficiency of U.S.
ideological controls, business controls, is such that this has remained the
only country where the day of solidarity with U.S. labor was never even
known. U.S. workers finally did, in the 1930s, achieve elementary rights,
including the right to an eight-hour day, which had long been achieved
elsewhere.

But since then that's been eroded. They've long lost the eight-hour day.
Juliet Schor, an economist at Harvard, had an important book on this called
The Overworked American. It came out a couple of years ago. She studied
things like working hours. They have been increasingly steadily. If I
remember her figures correctly, by around 1990, the time she was writing,
workers had to put in about six weeks extra work a year to maintain
something like a 1970 real-wage level.

Along with the increasing hours of work comes increasing harshness of work
conditions, increasing insecurity, and reduced ability to protect oneself
because of the decline of unions. In the Reagan years, even the minimal
government programs for protecting workers against workplace accidents and
so on were reduced in the interest of maximizing profits. Furthermore,
since the Reaganites regarded the government they ran as basically just a
criminal enterprise in the service of the rich, they simply didn't enforce
laws on safe working conditions and the like. That again leads to violence.
In the absence of constructive options, like union organizing, it leads to
violence. It's not very surprising.

A last comment about this May Day story: This morning, May 2, way back on
the back pages of the Boston Globe there was a little item which said -- I
was surprised when I saw it, I don't think I've ever seen this here in the
U.S. -- "May Day Celebration in Boston." So I naturally looked at it. It
turned out that there indeed was a May Day celebration, of the usual kind,
by immigrant workers -- Latin American and Chinese workers -- who have
recently come here. They organized to celebrate May Day and to organize for
their rights. That's a dramatic example of how efficient business
propaganda and indoctrination has been in depriving people of even any
awareness of their own rights and history. You have to wait for poor Latino
and Chinese workers to have a celebration of a couple hundred people of an
international day of solidarity with American workers.

DB: Let's go back to talk a bit more about the health issue. There had been
some media attention on AIDS but very little to breast cancer. A half a
million women in the U.S. will die in the 1990s from breast cancer. Many
men will die from prostate cancer. What are your views on that? Those are
not considered political questions, are they?

If you mean by that there's no vote taken on them, yes, there's no vote
taken on them. But obviously all of these things are political questions,
if we mean by that questions of policy. You might add to that calculation
the number of children who will die or suffer because of extremely poor
conditions in infancy and childhood, prenatal and early postnatal.

Take, say, malnutrition. That decreases life span quite considerably. If
you count that up in deaths, that outweighs anything you're talking about.
I don't think many people in the public health field will question the
conclusion that the major contribution to improving health, meaning
reducing mortality figures and improving the quality of life, come from
simple public health measures, like ensuring people adequate nutrition and
safe and healthy conditions of life, water, sewage, and so on. You'd think
in a rich country like this these wouldn't be big issues. But they are for
a lot of the population.

Lancet, the British medical journal, the most prestigious medical journal
in the world, recently pointed out that forty percent of children in New
York City live below the poverty line, meaning suffering conditions of
malnutrition and other poor conditions of life which mean very severe
health problems all through their lives and very high mortality rates. One
of the American medical journals pointed out a couple of years ago that
black males in Harlem have about the same mortality rate as people in
Bangladesh. That's essentially because of the extreme deterioration of the
most elementary public health conditions. That includes social conditions,
incidentally.

DB: The government is often fond of declaring war on drugs, war on crime,
but there's been no attendant war on breast cancer, for example.

There is a war on cancer generally. A lot of the biological research is
funded with curing cancer as its goal, although not specifically breast
cancer.

DB: Some people have linked the increase in breast cancer and prostate
cancer to environmental degradation and also to diet, the increase of
additives and preservatives. What do you think about that?

It's presumably some kind of a factor. How big or serious a factor it is
I'm not sure.

DB: Are you at all interested in the so-called natural or organic food
movement?

Sure. I think there ought to be concerns about the quality of food. This I
would say falls into the question of general public health. It's like
having good water and good sewage and making sure that people have enough
food and so on. All of these things are in roughly the same category, that
is, they have to do not with, say, high-technology medical treatment but
with essential conditions of life. These general public health issues, of
which eating food without poisons is a part, naturally, are the
overwhelming factors in quality of life and mortality, for that matter.

DB: I was at a conference a couple of weeks ago in Washington, D.C. A woman
in the audience got up and in addition to attributing all sorts of power to
the left, which is total fantasy, she also decried the fact that you are in
favor of nuclear power. Does that accurately describe your views?

No. I don't think anybody's in favor of nuclear power, even business,
because it's too expensive. But what I am in favor of is being rational on
the topic. Rationality on the topic means recognizing that the question of
nuclear power is not a moral one. It's a technical one. You have to ask
what the consequences are of nuclear power versus alternatives. I don't
think this is true, but imagine that the only alternatives were
hydrocarbons and nuclear power. If you had to have one or the other, you
have to ask yourself which is more dangerous to the environment, to human
life, to human society? It's not an entirely simple question.

For example, suppose that fusion were a feasible alternative. It could turn
out to be non-polluting, in which case it would have advantages. On the
other hand, any form of nuclear power has disadvantages. There are problems
of radioactive waste storage which are quite serious. Technical problems
might be overcome. There are problems of the dangers of how this
contributes to nuclear weapons proliferation. Those are negative factors.

On the other hand, there are also potentially positive factors, like lack
of pollution. There are other negative factors, like the high degree of
centralization of state power, centralized power that's associated with
nuclear power. But on the other hand, that's also true of the hydrocarbon
industry. The energy corporations are some of the biggest in the world. The
Pentagon system is constructed to a significant degree to maintain their
power. There is a range of other alternatives, including conservation,
decentralized power, options such as solar and so on. They have advantages.
But across the board these are problems that have to be thought through.

DB: Let's talk along these lines about the whole notion of economic growth
and development. The U.S., with five percent of the world's population,
consumes forty percent of the world's resources. You don't have to be a
Nobel Prize winner or a genius to figure out what that's leading to.

For one thing, a lot of that consumption is artificially induced
consumption. It's not consumption that has to do with people's real wants.
A huge amount of business propaganda, meaning the output of the public
relations industry, advertising and so on, is simply an effort to create
wants. This has been well understood for a long time, in fact, it goes back
to the early days of the Industrial Revolution. There's plenty of
consumption, and much of that is artificially induced. People would be
probably better off and happier if they didn't have it. Also, the
consumption is naturally highly skewed.

Consumption tends to be more by those who have more money, for obvious
reasons. So consumption is skewed towards luxury for the wealthy rather
than necessities for the poor. That's true not just within the U.S. but on
a global scale. That leads to the figures that you describe. The richer
countries are the higher consumers by a large measure, but internally to
the richer countries, the wealthy are higher consumers by a large measure.
And much of that consumption is artificially induced. It has little to do
with basic human interests and needs and concerns. It's also in the long
term very dangerous. It's healthy for the economy if you measure economic
health by profits. If you measure economic health by what it means to
people it's very unhealthy, particularly in the long term.

DB: There have been some proposals put forth about something called
"sustainable development." There's a social experiment in the Basque region
of Spain, in Mondragon. Can you describe that? Have you been there?

I haven't been there, but I know what you mean. Mondragon is a basically
worker-owned cooperative of a very substantial scale and economically quite
successful with many different industries in it, including manufacturing
industries of a fairly sophisticated nature. However, remember, it's
inserted into a capitalist economy. So it's no more committed to
sustainable growth than any other part of the capitalist economy is.
Internally it's not worker-controlled. It's manager-controlled. So it has a
kind of a mixture of what's sometimes called industrial democracy, that
means ownership, at least in principle, by the work force, mixed together
with elements of hierarchic domination and control, which means not
worker-managed. So it's a mixture. I mentioned before that businesses, say,
corporations, are about as close to totalitarian structures, to strict
hierarchic structures, as any human institutions are. Something like
Mondragon is considerably less so.

Incidentally, before we entirely leave the health-care issue, there's
another point that ought to be mentioned. The usual concern is the one that
we discussed, namely the fact that all the programs, whether it's from
Clinton over to the right, essentially vest power in the hands of huge
insurance companies, which means that they will try to micromanage health
care to reduce it to the lowest possible level, because naturally they're
profit-making. They will also tend away from things like prevention and
public health measures, which are not their concern, towards the technical
side. It also means that the public has to pay for the enormous
inefficiencies involved, such as huge profit, big corporate salaries and
other corporate amenities, to big bureaucracy to control in precise detail
what doctors and nurses do and don't do. So there are a lot of
inefficiencies and inequalities and in my view just immoral elements to it.
But that's only one factor.

There's another factor that's rarely discussed. That is that the Clinton
program and all others like them are radically regressive. Just ask who
pays and how much they pay. In a Canadian-style system, a government
insurance system, the costs are distributed as the tax costs are
distributed. So to the extent that the tax system is progressive, meaning
rich people pay more and in fact pay a higher percentage, which is assumed,
correctly, to be the only ethical standard in all the industrial societies,
the costs of health care are distributed with heavier costs to the more
wealthy.

All the systems being proposed here are radically regressive. They
essentially are flat, meaning that a janitor in the corporation and the CEO
pay the same amount. That's as if they both paid the same taxes, which is
unheard of in any civilized society. That's rarely discussed. If you look
at it, it's even worse. It's going to turn out that the janitor will
probably pay more. The reason is that the janitor will be living in a poor
neighborhood somewhere and the executive will be living in a rich suburb or
a downtown highrise, and they will belong to different health groupings. It
will turn out that the one that the janitor belongs to includes many more
poor and high-risk people. The insurance companies will demand higher rates
from them than from the executive, who will be from lower-risk wealthier
people. So it will turn out that the poor person will probably pay more in
the long term. These are just incredible features of any form of social
planning. And they're all built into all of these plans. It's very rarely
discussed.

DB: Speaking of taxes, there's a new book out by a couple of Philadelphia
Inquirer reporters called America: Who Pays the Taxes? Apparently they are
producing evidence in that book which shows that the amount of taxes paid
by corporations has dramatically declined in the U.S.

That's for sure. That's been very striking through the last fifteen years.
Actually, the whole tax system is an extremely complex one. People have
looked into it for years. Joseph Pechman was one of the leading specialists
who pointed out that despite the progressivity that was built into some of
the tax system, there are other regressive factors which enter in in all
sorts of ways that end up making it very near a fixed percentage.

DB: Let's talk about Richard Nixon briefly. His death generated much
fanfare. Henry Kissinger in his eulogy said: "The world is a better place,
a safer place because of Richard Nixon." I'm sure he was thinking of Laos,
Cambodia and Vietnam. Let's focus on one place that was not mentioned at
all in the media hoopla, and that is Chile, and see how it is a "better and
safer place." In early September 1970, Salvador Allende was elected
President in a democratic election. What were Allende's politics?

Allende was basically a social democrat, very much of the European
character. He would have fitted very well into the democratic socialist
spectrum in Europe. Chile was a very inegalitarian society. He was calling
for redistribution, for help to the poor. He was a doctor, and one of the
things he did was to institute a free milk program for half-a-million very
poor children to overcome these problems of child malnutrition and
deficiency that are the major health issues, as we have been discussing. He
called for nationalization of major industries, the major extractive
industries, for social regulation, for a policy of international
independence, meaning not simply subordination to the U.S., but more of an
independent path, programs of that kind, which are not unfamiliar
throughout the general social democracy.

DB: Was that a free and democratic election?

Not entirely, because there were major efforts to disrupt it, mainly by the
U.S. That goes way back. For example, in the preceding election, in 1964,
in the preparation for that election, which was under Kennedy, and the
actual election, which happened to be under Johnson, the U.S. intervened
massively to try to prevent Allende from winning. When the Church Committee
investigated this years later, it discovered that the per capita expenses
for the ultimately winning candidate, the one the U.S. supported, were
higher than those of both U.S. candidates, Johnson and Goldwater, in the
U.S. elections in the same year. That's a measure of the extent of the U.S.
intervention to disrupt the election of 1964.

Similar measures were undertaken in 1970 to try to prevent a free and
democratic election. They were very substantial. There were huge amounts of
black propaganda about how if Allende won mothers would be sending their
children off to Russia to become slaves, and so on. The U.S. threatened to
destroy the economy, which it could and in fact did do. So the election was
not free and democratic in that sense. There was extensive outside
intervention to try to disrupt it.

DB: Nevertheless Allende did win. A few days after his electoral victory,
Nixon called in CIA Director Richard Helms, Kissinger, and others for a
meeting on Chile. Can you describe what happened?

That's the meeting of what was called the "40 Committee" that Kissinger
chaired. As Helms reported it in his notes, there were two tracks, the soft
track and the hard track. The soft track was to "make the economy scream."
Those were Nixon's words. The hard line was just to aim for a military
coup. These were called track one and track two. Much of this later came
out, in part in the Church Committee.

Ambassador Edward Korry, who was a Kennedy-liberal type, was assigned the
task of implementing track one, the soft line. Let me quote you his own
words as to what track one was: The soft line was to "do all within our
power to condemn Chile and the Chileans to utmost deprivation and poverty,
a policy designed for a long time to come to accelerate the hard features
of a Communist society in Chile." That's the soft line, namely to really
make them suffer utmost deprivation and poverty so they'll know from now on
they'd better vote the way we tell them. That's the soft Kennedy liberals.
The hard line was just to have a military coup.

DB: There was a massive destabilization and disinformation campaign. The
CIA planted stories in El Mercurio and fomented labor unrest and strikes.

They really pulled out the stops on this one. Later, when the military coup
finally came and the government was overthrown, you had thousands of people
being slaughtered, imprisoned, and tortured. Then the U.S. changed its
position and gave massive support to the new Pinochet government as a
reward for its achievements in reversing Chilean democracy and instituting
a murderous terror state of the Brazilian style. So economic aid which had
been cancelled immediately began to flow. The U.S. had blocked
international aid. That came in. Huge credits were given for wheat. All
possible help was given.

The question of torture was brought up to Kissinger by the American
Ambassador. Kissinger gave him a sharp lecture, something like, Don't give
me any of those political science lectures. We don't care about torture. We
care about important things. He also explained what the important things
were.

He was concerned, he said, that an Allende success, the success of social
democracy in Chile, would be contagious. It would infect southern Europe,
like Italy, and lead to the possible success of what was then called
Eurocommunism there, meaning the Communist parties were moving in a social
democratic direction and hooking up with social democratic parties.
Actually, the Kremlin was just as much opposed to that as Kissinger was. So
he was afraid that the contagious example of success in Chile under a
democratic reformist system would infect places like Italy.

That really tells you what the domino theory is about, very clearly. Even
Kissinger, mad as he is, didn't believe that Chilean armies were going to
descend on Rome. It wasn't going to be that kind of an influence. The
influence would be the demonstration effect of successful economic
development, where here the economy doesn't just mean profits for private
corporations, but the state of the general population. That's dangerous. If
that gets started, it will have a contagious effect. So Kissinger's
thinking was quite accurate. Also it's revealing. In those comments he
revealed the basic story of U.S. foreign policy for decades.

DB: You see that pattern repeat itself in Nicaragua in the 1980s, the
threat of a good example.

Everywhere. The same was true in Vietnam, in Cuba. It was true of
Guatemala, of Greece. Always. That's the basic story: The threat that there
will be a contagious effect of successful development.

DB: Kissinger also said, again speaking about Chile, that "I don't see why
we should have to stand by and let a country go Communist due to the
irresponsibility of its own people."

This is the Economist line, that we should make sure that policy is
insulated from politics. If people are irresponsible, they should just be
cut out of the system. Kissinger is just an extreme example of what
Jefferson called an "aristocrat," with utter contempt for democracy and
complete dedication to service to power.

DB: I'm also reminded of Seymour Hersh's description of Kissinger sitting
in the Oval Office while Nixon was ranting and raving about Jews, making
very anti-Semitic remarks, and he was just sitting there, saying nothing.

He was also sitting there while even worse things were being said about
blacks, in fact, he was participating in them. The racism of the Nixon
administration was appalling. When Nixon gave Kissinger instructions as to
how to write his first State of the Union address, according to people
there, he said, "Put something in it for the jigs." Kissinger apparently
nodded approvingly or quietly. Jigs being blacks.

DB: What about the role of the CIA in a democratic society? Is that an
oxymoron?

You could imagine that a democratic society would have an organization that
carries out intelligence gathering functions. But that's a very minor part
of what the CIA does. The CIA is mainly a branch of the executive to carry
out secret and usually illegal activities that the executive branch wants.
It wants them to be kept secret because it knows that the public won't
accept them. So it's highly undemocratic even domestically. The activities
that it carries out are quite commonly efforts to undermine democracy, as
the Chilean case through the 1960s into the early 1970s demonstrates with
great clarity. It's by far not the only one. Although we talk about Nixon
and Kissinger, similar policies were being carried out by Kennedy and
Johnson in the earlier Chilean election.

DB: Is the CIA an instrument of state policy or does it formulate policy?

You can't be certain. My own view is that the CIA is very much under the
control of executive power. I've studied those records fairly extensively
in many cases, and there are very rare examples when the CIA undertook
initiatives on its own. It often looks as though it's undertaking
initiatives on its own, but that's because the executive wants to preserve
deniability. The executive branch, say, Kennedy, doesn't want to have
documents lying around saying, I told you to murder Lumumba. That's
Eisenhower in that case. Or, I told you to overthrow the government of
Brazil. They don't want such documents around. Or I wanted you to
assassinate Castro. Or whoever it may be. The executive would like to be
protected from such exposure. As a result, they try to follow policies of
plausible deniability, which means that messages are given to the CIA to do
things but without a paper trail, without a record. When the story comes
out later it looks as if the CIA is doing things on their own. But if you
really trace it through, I think this almost never happens.

DB: Let's stay, in Henry Stimson's words, in "our little region over here
which has never bothered anyone," Latin America and the Caribbean. Let's
move from Chile in the 1960s and 1970s to Haiti in the 1990s. Jean-Bertrand
Aristide is elected President in December 1990 in what has been widely
described as a free and democratic election. I think he got 67% of the
vote. Seven months after taking office he is overthrown in a coup d'Θtat.
Do you see any connections there in U.S. policy?

When Aristide won it was a big surprise. He was swept into power by a
network of popular grass roots organizations, what was called Lavalas, the
flood, which outside observers just weren't aware of. They don't pay
attention to what happens among poor people. There had been very extensive
and very successful organizing. Out of nowhere came this massive network of
organized grass roots popular organizations and managed to sweep their
candidate into power. The U.S. expected that its own candidate, a former
World Bank official named Marc Bazin, would win the election. He had all
the resources and support. It looked like a shoe-in. The U.S. was willing
to support a democratic election, figuring that its candidate would easily
win. He lost. He got fourteen percent of the vote, and Aristide got about
67%. The only question in anybody's mind at that time should have been, how
is the U.S. going to get rid of him, for very much the reasons that
Kissinger explained in the case of Chile. That is so uniform and invariant
that the basic question was, What will be the method for getting rid of
this disaster?

The disaster became even worse in the first months of Aristide's office.
During those seven months there were amazing developments. Haiti, of
course, is an extremely impoverished country, with awful conditions.
Aristide was nevertheless beginning to get places. He was able to reduce
corruption extensively, to trim a highly bloated state bureaucracy, winning
a lot of international praise for this, even from the international lending
institutions, the IMF and the World Bank, who were offering him loans and
preferential terms because they liked what he was doing. He was getting
independent support outside the U.S. Furthermore, he cut back on drug
trafficking. The flow of refugees to the U.S. virtually stopped. Atrocities
were reduced to way below what they had been or would become. They were
very slight. There was a considerable degree of popular engagement in what
was going on, although the contradictions were already beginning to show
up. There were constraints on what he could do, external constraints.

All of this made the democratic election even more unfavorable and
unacceptable from the point of view of U.S. policy, and indeed the U.S.
moved at once to try to undermine it through what were naturally called
"democracy-enhancing programs." The U.S., which had never cared at all
about centralization of executive power when its own favored dictators were
there, all of a sudden became involved in trying to set up alternative
institutions that would undermine executive power in the interests of
greater democracy. A number of those groups, which were alleged to be human
rights and labor groups, survived the coup and became the governing
authorities after the coup. This went on for a couple of months. On
September 30, 1991 the coup came. The Organization of American States
declared an embargo. The U.S. joined it but with obvious reluctance. The
Bush administration was really dragging its feet. It was perfectly obvious.
The government focused attention on alleged atrocities or undemocratic
activities of Aristide, downplaying the major atrocities that were taking
place right then, and the media went along.

While people were getting slaughtered in the streets of Port-au-Prince, the
media were concentrating on alleged human rights abuses under the Aristide
government, the usual pattern. We're familiar with it. Refugees started
fleeing again because the situation was deteriorating so rapidly. The Bush
administration blocked them, instituted in effect a blockade to send them
back. Within a couple of months, in early February (the embargo was
instituted in October), the Bush administration had already undermined the
embargo by instituting an exception, namely, that U.S.-owned companies
would be permitted to ignore the embargo. The New York Times called that
"fine-tuning" the embargo to improve the restoration of democracy. The
fine-tuning meant that U.S. companies could continue to proceed without any
concern for the embargo.

Meanwhile, the U.S., which is known to be able to exert pressure when it
feels like it, found no way to influence anyone else to observe the
embargo, including the Dominican Republic next door. The whole thing was
mostly a farce. Pretty soon Marc Bazin, the U.S. candidate, was in power as
Prime Minister, with the ruling generals behind him. That year, 1992, U.S.
trade with Haiti continued not very far below the norm despite the
so-called embargo.

During the 1992 campaign Clinton bitterly attacked the Bush administration
for its inhuman policy of returning refugees to this torture chamber, which
is incidentally not only inhuman but also in flat violation of the
Universal Declaration of Human Rights, which we claim to uphold. He
announced that he was going to really change all this stuff. His first act
as elected President, even before he took office, was to make the Bush
blockade even harsher. He imposed even harsher measures to force fleeing
refugees back into this hellhole. Ever since then it's simply been a matter
of seeing what kind of finessing will be carried out to ensure that the
popularly elected government doesn't come back into office. It only has
another year and a half to run, so they've more or less won that game.
Meanwhile the terror increases. The atrocities increase. The popular
organizations are getting decimated. People are suffering.

U.S. trade meanwhile continues and in fact went up by about 50% under
Clinton under the so-called embargo. In fact, Haiti, which is a starving
island, is exporting food to the U.S., fruit and nuts, under the Clinton
administration. This went up by a factor of about thirty-five under Clinton
as compared with Bush. Baseballs are coming along nicely. This means women
are working in U.S.-owned factories where, if they meet their quota, they
get ten cents an hour. Since they don't usually meet their quota, their
wages go down to something like five cents an hour. They don't last in it
very long. Softballs in the U.S. are advertised as being unusually good
because they're hand-dipped into whatever it is that makes them hang
together properly. They're hand dipped by Haitian women into toxic
substances with obvious effect. The work conditions are indescribable.

All of this continues, in fact has increased, under Clinton. Meanwhile, the
conditions for forcibly returning refugees have gotten much harsher. The
terror and the torture have increased. The U.S. tried for a long time to
get Aristide to "broaden his government in the interests of democracy."
Broaden the government is a phrase which means throw out the two-thirds of
the population that voted for you. They're the wrong kind of people. And
bring in what are called "moderate" elements of the business community,
those who don't think you just ought to slaughter everybody and cut them to
pieces and cut their faces off and leave them in ditches. Those are the
extremists. The moderates think you ought to have them working in your
assembly plants for fourteen cents an hour under conditions of the kind I
described. Those are the moderates. So bring them in and give them power
and then we'll have a real democracy. But unfortunately, Aristide, being
kind of backward and disruptive and the whole series of bad words, has not
been willing to go along with that. Therefore the U.S. has failed in its
efforts to broaden the government and restore the democratic system.

This policy has gotten so cynical and outrageous that Clinton has lost
almost all major domestic support on it. Even the mainstream press is
denouncing him at this point. So there will have to be some cosmetic
changes made. But unless there's an awful lot of popular pressure, these
policies will continue in one way or another, and pretty soon we'll have
the moderates in power. Then they'll even be able to run a democratic
election, if people are sufficiently intimidated, popular organizations are
sufficiently destroyed, and people get it beaten into their heads that
either you accept the rule of those with the guns and the gold-plated
Cadillacs or else you suffer in unrelieved misery. Once people understand
that, you can have a democratic election and it will all come out the right
way. Everybody will cheer.

DB: In this period of Aristide's exile, he has been asked to make
concessions to the junta, to CΘdras and Franτois.

And the right-wing business community.

DB: This is kind of curious. For the victim, the aggrieved party, to make
concessions to his victimizer.

It's perfectly understandable. The U.S. was strongly opposed to the
Aristide government. It had entirely the wrong base of support and power.
What he is supposed to do is to cede power to those who count. The U.S. has
no particular interest in CΘdras and Franτois, but it does have a lot of
interest in the sectors of the business world that are linked to American
corporations. I mean the people who are the local owners or managers of
those textile and baseball-producing plants. Those who are linked up with
U.S. agribusiness. Those are the people who are supposed to be in power
everywhere. When they're not in power it's not democratic and we therefore
have to make concessions to bring them into power.

DB: Let's say Aristide is "restored." But given the destruction of popular
organization and the devastation of civil society, what are his and the
country's prospects?

Some of the closest observation of this has been done by Human Rights
Watch, the Americas Watch branch of it. Back over a year ago they came out
with a good report in which they described what was going on. They gave
their own answer to that question, which I thought was plausible. They said
that things are reaching the point (this is over a year ago) that even if
Aristide were restored, the lively, vibrant civil society based on
grass-roots organizations that had brought him to power would have been so
decimated that it's unlikely that he would have the popular support to do
anything anyway. I don't know if that's true or not. Nobody knows, any more
than anyone knew how powerful those groups were in the first place. Human
beings have reserves of courage that are often hard to imagine. But I think
that's the plan. The idea is to try to decimate the organizations, to
intimidate people sufficiently that it won't matter if you have democratic
elections.

There was an interesting conference run by the Jesuits in El Salvador. Its
final report came out in January of this year. They discussed questions of
this kind. This is several months before the Salvadoran elections. They
were talking about the buildup to the elections. They did discuss, as a lot
of people did, the ongoing terror which was substantial and which was
plainly designed to keep up front in people's minds that you better vote
the right way or else. But they also pointed out something else which is
much more important. That had to do with the long-term effects of terror.
And they've had plenty of experience with this. The long-term effects of
terror, they said, are simply to "domesticate people's aspirations" and to
reduce their aspirations to those of the powerful and the privileged.
Terror instills into people's minds the idea that there is no alternative.
Drive out any hope. Domesticate aspirations. Subordinate yourself to the
powerful. Once that achievement has been reached, perhaps by massive and
horrifying terror, as in El Salvador, after that you can run democratic
elections without too much fear.

DB: The U.S. refugee policy is in stark contrast. You mentioned it briefly.
Cuban refugees are considered political and are accepted immediately into
the U.S., while Haitian refugees are termed economic and are refused entry.

That's determined by ESP, since they never check with them. In fact, if you
look at the records, people who are being refused asylum suffer enormous
persecution. Just a couple of weeks ago there were two interesting leaks
from the Immigration and Naturalization Service, INS. One is a Haitian desk
officer who was discovered by Dennis Bernstein at KPFA, who interviewed
him. He had been working in the Port-au-Prince embassy. He described how
they were not even making the most perfunctory efforts to check the
credentials of people who were applying for political asylum because they
don't want them. At about the same time there was a leak of a document from
Cuba, from the U.S. interests section in Havana, which checks asylum,
complaining about the fact that they can't find genuine political asylum
cases. The people who are claiming asylum can't really claim serious
persecutions by international or even U.S. standards. At most they claim
various kinds of harassment that wouldn't qualify them. They're worried
about this. So here are the two cases, side by side. I should mention that
the U.S. Justice Department has just made a slight change in U.S. law which
makes the violation of international law and the Universal Declaration of
Human Rights even more grotesque. It has just determined that Haitian
refugees who reach U.S. territorial waters, by some miracle, can also be
shipped back. That's never been allowed before. I doubt that any other
industrial country allows that.

DB: Do you have a few more minutes?

I'm afraid I have another appointment. They are probably trying to get on
the line right now.

DB: OK. Let's wind it up. Thanks a lot. Talk to you soon.
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