Obama Joins Club of the Super-Rich – Defends Global Capitalism in Lecture (1/2)

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Prof. Leo Panitch and Paul Jay discuss Obama’s Mandela lecture; Obama wants the impossible – a world where the super-rich give up “a little” and there is no massive inequality

Story Transcript

PAUL JAY: Welcome to The Real News Network. I’m Paul Jay.

According to The New York Times, President Obama has been photographed kitesurfing with Richard Branson off Necker Island, relaxing on David Geffen’s yacht French Polynesia with Bruce Springsteen and Oprah Winfrey, river rafting with his family in Bali, and posing with a celebrity chef in Tuscany. To those who have paid only casual attention to former President Barack Obama’s foreign travels since he left the White House in January 2017, it can seem as if Mr. Obama has been on an extended vacation of the kind only the very rich can afford. That’s from the New York Times.

Well, in his speech giving the 2018 Nelson Mandela Lecture, President Obama talked about the exclusive company he now keeps.

BARACK OBAMA: In every country just about, the disproportionate economic clout of those at the top has provided these individuals with wildly disproportionate influence on their countries’ political life and on its media; on what policies are pursued and whose interests end up being ignored. Now, it should be noted that this new international elite, the professional class that supports them, differs in important respects from the ruling aristocracies of old. It includes many who are self-made. It includes champions of meritocracy. And although still mostly white and male, as a group they reflect a diversity of nationalities and ethnicities that would not have existed a hundred years ago. A decent percentage consider themselves liberal in their politics, modern and cosmopolitan in their outlook. Unburdened by parochialism, or nationalism, or overt racial prejudice or strong religious sentiment, they are equally comfortable in New York or London or Shanghai or Nairobi or Buenos Aires, or Johannesburg. Many are sincere and effective in their philanthropy. Some of them count Nelson Mandela among their heroes. Some even supported Barack Obama for the presidency of the United States. And by virtue of my status as a former head of state, some of them consider me as an honorary member of the club. And I get invited to these fancy things, you know? They’ll fly me out.

But what’s nevertheless true is that in their business dealings, many titans of industry and finance are increasingly detached from any single locale or nation-state, and they live lives more and more insulated from the struggles of ordinary people in their countries of origin. And their decisions- their decisions to shut down a manufacturing plant, or to try to minimize their tax bill by shifting profits to a tax haven with the help of high-priced accountants or lawyers, or their decision to take advantage of lower-cost immigrant labor, or their decision to pay a bribe- are often done without malice; it’s just a rational response, they consider, to the demands of their balance sheets and their shareholders and competitive pressures. But too often, these decisions are also made without reference to notions of human solidarity.

PAUL JAY: President Obama is a member of the meritocracy he refers to, and has earned his way into this top tier of elites who have such enormous clout in determining the fate of peoples. This speech was a defense of the system that gave him such power and prestige; a defense of global capitalism. It’s an important speech, I think, because it lays out what Obama sees as the achievements of globalization, which he thinks are many. He sees the great inequality that has been produced, and the rise of the populist right, and says that the solution to these problems is more global capitalism, but one that’s more enlightened and inclusive.

Joining me to discuss Obama’s speech is Professor Leo Panitch, Professor Emeritus of York University and co-author of The Making of Global Capitalism, The Political Economy of American Empire, and editor of The Socialist Register. The next issue is titled “A World Turned Upside Down.” Thanks for joining us, Leo.

LEO PANITCH: Glad to be here, Paul. Great topic.

PAUL JAY: So, Leo, in the segment of the speech we played, Obama’s talking about the liberal elites, also known in political terms as corporate Democrats, the elites that backed the Clintons and Obama; people who see their decisions as a rational response to the demands of shareholders and competitive pressures, as Obama put it. I’m sure he sees his own policies in the same light. Yet the global system is increasingly irrational, and it was Obama’s supposed rational policies that helped create the inequality that fueled the rise of the extremist climate crisis-denying neofascist Trump in the first place.

So Leo, the decay of the system seems to be speeding up, and the political crisis seems to reflect it.

LEO PANITCH: Yeah, it does. You know, one has to say-. He says that himself. And, and he is identifying the decay of the system very explicitly. So you know, what does one do with this kind of speech? On the one hand, you say hanging out with Springsteen. And maybe we need to see him like Springsteen. We need to see him as a singer, as a speech maker. And as a speech, compared with most politicians’ speeches these days, this one has a lot of substance. You know, whether one agrees with it or not, this is, you know, for a politician, a pretty intellectually impressive piece of work.

So as with Springsteen, who after all appeared at his inauguration singing This Land Is Your Land, bringing Pete Seeger, and explicitly keeping in the verse on private property, there are elements of this speech, I entirely agree with the way you presented it and with his own lack of honesty about his complicity. That said, there are elements in it that can be used, and used very powerfully. For instance, he says all of what you said, and he does praise globalization. Even worse, he very- apparently uncritically- the whole first half of the speech before he gets to globalization presents the march of democracy, the struggles for national liberation, the winning of the welfare state, the winning of trade unions, et cetera, as the march of progress through history that brought us to a wonderful world.

But even before he says we’re in decay, very few politicians who want to go back to, say, the Keynesian welfare state, to the ’50s and ’60s, admit what he admitted, which is that we have to start by admitting that whatever the laws were on the books, the previous structures of privilege and power and injustice and, get it, exploitation never completely went away. And even earlier in the speech said, and that includes exploitation of whites by other whites, and puts it more strongly than I’m putting it, actually, now.

So he gives you something there. And he not only then does a diversity thing, which my Prime Minister Justin Trudeau is so full of, in every sense of that word. He actually goes back to exploitation, by saying that workers in agriculture and manufacturing have been harmed by globalization, that unions have lost their power, and that this is at the source of the vast growth in inequality.

So the speech covers every base. He is and he has always been a politician that appeals across classes. That’s very true. And he certainly is appealing to the morality of the elites, who he says do govern the world, and especially the economic elites, saying to them, you know, how much can you consume? How big a house can you live in? Et cetera. Appealing them to pay more taxes, to give back more in charity, et cetera. But essentially he says we need capitalism. But we’d like a nice, humane capitalism. That said, in these elements of the speech he gives us enough to see that those capitalists can never do this. That they will never give up their privilege and power, that they are indeed dependent on this system in order to accumulate through exploitation and injustice.

So it’s a bit like Springsteen, who makes a lot of money, and yes, you know, goes up on these yachts himself, but gives us songs that we can sing.

PAUL JAY: Yeah. The contradiction with his speech- and this is, it reminds me of something Bill Clinton did, which is Obama seems very aware of how the system works. He has a big picture. I once saw- the reason I refer to Bill Clinton is when Chavez was at the United Nations and did the ‘I smell sulfur’ speech, Clinton happened to be in Toronto. And a CBC interviewer asked him what he thought of Chavez’s speech, because it created such a kerfuffle here, insulting George Bush, the president in the United States, which a foreign dignitary, in theory, is not supposed to do. And Clinton said, well, you know, that was too much, offending everyone like that. But he says, Chavez could have given a critique of the kind of economic policies that the United States supported in Latin America.

And then Clinton went on to give one of the best critiques of neoliberal economics and how it screwed up Latin America I’ve ever heard. A really good, fact-based critique. Of course not saying these were his policies. These guys are very, very aware of how the system works.

LEO PANITCH: Very aware. They are pragmatic. They are pragmatic, and they decided as very young men, open to the same type of influence as you and I were, Paul, they decided as very young men that you couldn’t get out of this system. They of course, also, were highly ambitious. And that, with their ambition and their pragmatism, led them to embrace a system in which there is this type of fundamental inequality of power, and attempt to, as he did as a, as an organizer of the poor in Chicago. What he used to do was he would bring poor women from the Southside into a boardroom where the elite of the Democratic Party establishment in Illinois would sit. He’d put them in a room. He’d say, work out a solution, and walk out the door, as if you could work out a solution that way. And they would throw some crumbs at those poor women.

PAUL JAY: OK. Well, here’s a segment of the speech where he outlines the great achievements of globalization and the inequality it produces. It’s an example of how he gets both.

BARACK OBAMA: And while globalization and technology have opened up new opportunities, have driven remarkable economic growth in previously struggling parts of the world, globalization has also upended the agricultural and manufacturing sectors in many countries. It’s also greatly reduced the demand for certain workers, has helped weaken unions and labor’s bargaining power. It’s made it easier for capital to avoid tax laws and the regulations of nation-states- can just move billions, trillions of dollars with a tap of a computer key.

PAUL JAY: It’s hard to know where to start with that.

LEO PANITCH: You see, he does it all. It’s exactly what you were saying, Paul. He does it all. He lays it out in the bullshit terms that the promoters of globalization do, speaking as though everyone became an entrepreneur, rather than the vast majority of people became wage labor from having been independent commodity producers or peasants. He doesn’t mention the fact that the peasants who are producing corn in Mexico by virtue of NAFTA were driven across the border to become wage laborers in the United States, and are now, of course, the lobby fodder for Trump’s claim that they’re all rapists and murderers. He doesn’t say that.

And yet, a few paragraphs on, he provides the critique that we provide. In the same breath, without having gone back to the fact that they’re not all entrepreneurs, that they became, indeed, the people who are exploited by the entrepreneurs, whether those- and most of them were- multinational corporations, or whether they were rapacious local capitalists. But he gets precisely the kind of critique we would make, which is not only that certain countries were left out, and that was certainly true above all in Africa where he was speaking, and still is true, but it’s true of regions within every country of the world. Including within the United States, of course, which is one of the reasons Trump got elected.

So he provides his own critique. And, and in that sense, one has to say that, you know, he is a politician of a rather unique kind. He doesn’t bring it all together into the kind of critique of capitalism that is the only thing that can get us out of this. But he takes a step in that direction while he himself, of course, will never lead it.

Look. I have to admit, Paul, I think I’ve said this to you before. And I may be a sucker for this more than I should be. When he made his speech having won the Democratic nomination in 2008, it was a phenomenal speech to the assembled masses of people in Chicago. He came back to Chicago. I was half expecting him to say, now, don’t go home. What you need to do is double your movement capacity, double your mobilization, increase your pressure, et cetera. Instead, what did he do? He said thank you very much for putting me in this position, and you can go home now. And that’s the type of politician he is. One can fall for it, but it does give you certain language, a certain legitimacy for the kind of critiques we want to make. You go to excerpt pieces of the speech- and you do that, of course.

PAUL JAY: I think the critical point here, and I know it’s a point you’ve been making all through the Obama years and otherwise, the system itself is producing these conditions. So it’s not like Obama’s policies were the decisive element. It’s a fact that the Obama policies are exactly kind of what he said, what he and his people saw as a rational response to the ’07-’08 crisis. And why there’s an ’07-’08 crisis he doesn’t really want to dig into, because the issue of the role of finance and financialization, the owner of, private ownership of these massive banks that have such dominance over the economy, well, those are the forces that helped elect Barack Obama in the first place. He was, he was a Wall Street president, so he can’t talk about why this stuff is happening.

LEO PANITCH: Well, he does say irresponsible bankers. He does, you know-.

PAUL JAY: But he appointed irresponsible bankers as his finance team.

LEO PANITCH: It is-. Look, as you said, it’s systemic The problem is systemic. And the actions of those people within it are not so much evil, although they objectively are, they’re not driven by a lack of sense of morality. They are driven indeed by the competitive nature of the system. And he goes so far to say it is rational for them on their own terms to even be corrupt and to bribe, speaking in Africa, and especially in South Africa, given Zuma has just been overturned. You know, that’s a big thing to say. He even sees that as an endemic part of the system. And it is. That’s the whole point. And of course, he becomes trapped in it.

PAUL JAY: He’s a product of it. He was a general manager of it.

LEO PANITCH: Yeah. And was very much responsible for containing the crisis. And insofar as you contain the crisis within capitalism, that means you do have to save the banks. Which is what, of course, he did. Now, he grumbled a couple of times to Wall Street bankers in the White House about having done so, and earned their unending enmity just for grumbling to them that he had done so. You know, many of them were determined to get rid of him from 2011 on, when he grumbled to them about how they had ripped off the American government in order to be able to save the economy, the world, from a repeat of the Great Depression.

So he is- in a sense you’re right- getting at the fact, even though he then won’t carry it through, that the problem is systemic. That it isn’t just a matter of the banks being too large, it’s a matter of a dynamic global capitalism being dependent on having banks like this, who can grease the wheels of international trade and production, who can invent things like derivatives so that you can use all the speculation that there is in the financial markets to make it possible for a Chinese firm to know when they sign a contract with Wal-Mart in April what the exchange rate will be in October when they deliver the jeans. And unless they know that, they won’t be able to make a profit.

So the system is indeed in its own terms both chaotic and irrational, and nevertheless all fitted together. And he gives us a glimpse of that having decided himself, as you said, that he is going to live with it, and therefore can’t do any more than make these type of speeches for whatever mobilizing effect they have-.

PAUL JAY: And go on vacations in Bali.

LEO PANITCH: Yeah, and have vacations in Bali, and, you know, tell these guys that they ought to be nicer people, and that they ought to be giving iPhones to little kids in Kenya, and moreover to make the claim that gives them access to world knowledge and power. Well, it only does it the most passive sense, of course.

PAUL JAY: He sees the gross inequalities, he sees it’s getting worse. I think he’s just dreaming saying it’s getting less violent. I don’t know where he’s been. He’s clearly- between the Iraq war, the Syria war, and endless wars since World War II, I don’t know what, what he’s-. This is, this is purely a song. And then he has ideas of what the solutions look like and don’t work like. And the next segment of our interview we’re going to talk about Obama’s view of the rise of the right, and what he sees as a solution both to the inequalities and the rise of the right, and how realistic that song is. So please join us for the next segment of our interview with Professor Leo Panitch on The Real News Network.