Citigroup tells it like it is.

We watched Michael Moore’s Capitalism: A Love Story the other night.  As I often do with the contentious Mr. Moore’s films, I found sources to validate a few scenes that caught my eye.

First stop, Citibank’s “plutonomy report”.  In Moore’s film a few appalling sentence fragments from this document are thrown in with some flashy, rapid cutting and a lot of voice-over.  That would be a great way to hoodwink the audience if you felt like misrepresenting the document.  There does seem to be a bit of contextual fantasy (I don’t believe this memo was “confidential”.   It appears to be promotional material for a basket of investments in businesses that cater to the rich.)  However,  the content of the document is pretty much as Moore makes it sound: delight at the fact the rich are getting richer and everybody else is getting poorer.  Not only that, but wealth disparity has become so massive that nobody really matters any more except the rich, economically speaking.

The point here, again, is that the rich are feeling a great deal happier about their prospects, than the “average” American. And as the rich are accounting for an ever larger share of wealth and spending, it is their actions that are dictating economic demand, not the actions of the “average” American.

It’s no surprise to discover rich people are really excited about getting even richer, but it is a major deviation from industry approved propaganda to openly acknowledge that this is happening at the expense of the middle and lower classes.  It’s also rare to hear a Wall Street lobbyist cheer the fact that trade globalization almost entirely benefits wealthy capitalists while suppressing wages for everybody else.

This irritates me to no end, frankly.  If I were to walk up to your average Canadian conservative and say “economic globalization suppresses the standard of living for everyone, everywhere primarily to benefit of the richest people on earth” they’d call me a leftist lunatic and trot out the Fraser Institute approved theorem that if little third world kids weren’t chained to their sewing machines for 26 hours a day they’d be much worse off, really.  And yet here is Citibank happily publishing documents asserting exactly that.

…we believe that the rich are going to keep getting richer in coming years, as capitalists (the rich) get an even bigger share of GDP as a result, principally, of globalization.  We expect the global pool of labor in developing economies to keep wage inflation in check, and profit margins rising – good for the wealth of capitalists, relatively bad for developed market unskilled/outsource-able labor.

The risks?

At some point it is likely that labor will fight back against the rising profit share of the rich and there will be a political backlash against the rising wealth of the rich. This could be felt through higher taxation (on the rich or indirectly though higher corporate taxes/regulation) or through trying to protect indigenous laborers, in a push-back on globalization – either anti-immigration, or protectionism

OK!  Great!  Let’s get on with it!  I have a few suggestions:

Re-localize your economy: Support local businesses and craftsmen.  Implement a local exchange trading system (LETS).   Grow your own food and encourage others to do the same.

Do not support exploitative producers:  Support fair trade products and businesses and wean yourself off  plastic pumpkins and cheap t-shirts.  Read the labels and boycott products from countries with inadequate labor standards.  Be skeptical of deals that seem “too good to be true”, regardless of the purported country of origin.  Having worked in the garment industry, I can assure you that labels and customs documents very often lie to get around trade barriers and influence public perception.

Get out of debt (read: indentured servitude).  When in doubt, go without.  In the current pro-capitalist / anti-labor economic climate in Canada, jobs are scarce, poorly compensated and insecure and the Conservative government’s solution (as always) is “deregulation and tax cuts for the rich”.  Do what you can to get some breathing room if your income is suddenly suspended, your debt repayments spike due to some inconspicuous contractual fine print or your wages continue to fail to keep pace with the rising cost of living.

Stop watching the news. With very few exceptions, the mainstream media can not be trusted to present a true picture of what is going on in the world.  The richest people on earth own most of the major outlets and dictate editorial policy.  On top of that, their peers in many industries spend tens of billions of dollars a year to saturate major news outlets with misinformation and propaganda. Sit back and contemplate what you really care about, then find non-profit, non-governmental organizations working on those particular issues (Amnesty International, Human Rights Watch, B’Tselem, Greenpeace, etc.) and read their reports and news releases.

Most importantly, stop voting for centre-right “liberal” parties. There is very little difference between the economic policies of the Liberal and Conservative parties.  Since the Reagan-Thatcher revolution, both mainstream parties in Canada, the UK and the US have been pro-capitalist and pro-globalization, favoring tax breaks for the rich at the expense of public infrastructure and services for the poor.   Don’t be afraid to vote for a candidate that actually has your interests at heart, whether that candidate is an independent, NDP, Green Party or some other manifestation of genuinely liberal sentiment.

Push back.  Tax and regulate the rich.  Demand a greater share of the wealth.   According to Citigroup, we are the only foreseeable threat to the rising income inequality in Canada, Australia, the US and the UK.

Granted, their wisdom is highly suspect.  This document was published in 2006 – shortly before Citigroup went crying to the Federal Government for a third of a trillion dollars worth of taxpayer-funded corporate welfare to save them from insolvency. Moore could have mentioned that, or mentioned that the US government now owns a 36 % stake in the company, or that Citigroup has been removed from the Dow Jones Industrial Average due to “significant government ownership”.  But then it wouldn’t be a Michael Moore film, would it?

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2 Responses to “Citigroup tells it like it is.”

  1. Richard Says:

    I am not sure which I prefer: quoting a report whose existence is denied and being called a nut; or quoting a report that is out in the open for anyone to see and still being called a nut. We now know for sure everything we need to take to take to the streets, but we keep bending over for them.

  2. apophaticattic Says:

    No kidding! Try talking about Rebuilding America’s Defenses! I’m starting to see the media as a major obstacle to public political engagement. Of course we’re going to sound like nutcases when nearly every commentator anyone ever sees brainlessly repeats the industry-approved mantra that what’s good for the richest of the rich is good for everybody, and ignores evidence to the contrary.

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