XIR164723 Pantagruel's meal, from 'Pantagruel' by Francois Rabelais (1494-1553) engraved by Paul Jonnard-Pacel (d.1902) (engraving) (b/w photo)  by Dore, Gustave (1832-83) (after); Bibliotheque Nationale, Paris, France; Giraudon; French, out of copyright

So, literally overnight, we entered the stage of the great normalization. We’ve gone from the almost universal belief among the elites, media and a large number of the American public that electing Trump would be a disaster for the country, the economy, our liberty to an apparent shrug of the shoulders and sycophantic search for advantage in the new order.

We’ve gone from a candidate whose last act of his active campaign was to release a two minute ad that pledged resistance against a global financial elite that supposedly holds the white working class in its squid like death grip to a dizzying stock market rally upon his actual election.

What that tells me is that those so-called financial elites whose fortress Trump portrayed himself as storming at the head of an army of the forgotten aren’t all that scared and believe they will do just fine in the new order.

Perhaps that signals that Trump was merely play acting all along. His pulsating crowds shaking their fist at journalists or threatening minorities, and to imprison or even execute a former first lady, senator and secretary of state no more than a sideshow as unreal as Trump as in the ring of a WWE match.

Given his unreality, whatever emerges from the age of Trump is unpredictable and perhaps the man himself doesn’t know with the exception that he hopes to play the type of Moses leading Americans back to the promised land which would make Charlton Heston proud.

Apparently, the US stock market is rallying like Pavlov’ dog at the sound of coming tax cuts which will only exacerbate soaring inequality. On a more positive note they are also anxiously awaiting the kinds of infrastructure spending liberals like Paul Krugman have been arguing in favour of for years.

As the Steve Bannon the head of the alt-right media organization Breitbart, and the true genius behind Trump’s successful campaign strategy has laid out:

It’s everything related to jobs. The conservatives are going to go crazy. I’m the guy pushing a trillion-dollar infrastructure plan. With negative interest rates throughout the world, it’s the greatest opportunity to rebuild everything. Shipyards, iron works, get them all jacked up. We’re just going to throw it up against the wall and see if it sticks. It will be as exciting as the 1930s, greater than the Reagan revolution — conservatives, plus populists, in an economic nationalist movement.

This might mark an end to austerity and over reliance on central banks to keep the economy afloat, and though sorely needed it is not the same as support of social infrastructure which is maintained by many of the government  programs Trump and the GOP will aim to gut. Given how tight labor markets have become, it also might cause hyper-inflation or soaring interest rates as bond holder exit from the market and into an atavism like gold.

For now though the markets are far removed from the kind of crash that many thought a Trump victory would bring with the only group to have sunk with the election results being tech stocks. More on that in a bit.

What exactly Trump himself thinks about economics is something of a mystery. Other than seeing it as the ultimate game that creates the world’s winners and losers, where the most disreputable aren’t those obsessed by money or fame but those too stupid or lazy to play along with those who manipulate the rules so they can win.

Aside from that, Trump is like something out of another era- a kind of nationalist who thinks of the economy as almost synonymous with heavy industry. Inspired by his anti-globalism and the suffering of the rust belt men who launched him into office, Trump may be able to improve trade agreements at the margins and may even accelerate already apparent moves towards the “reshoring” of manufacturing. What he will not be able to do is restore manufacturing employment, which like agriculture before it, is seeing humans replaced with machines- and not just in the US.

I suppose even greater investment in manufacturing resulting in even further automation may improve US productivity, but not in the area where the majority of people work- that is services- where productivity gains are needed most- but where they’re needed least because those of us in rich countries are already drowning in stuff.

Perhaps Trump will try to a second great trust buster. That is, he will make an attempt to break up large banks and other multinational companies and especially the big 5 that dominate technology- Apple, Amazon, Alphabet, (Google) Facebook and Microsoft. At a minimum, Amazon appears to be in his sights.

Such a solution might go some way towards solving the fundamental economic problem of the age- namely the ever increasing accumulation of capital by only a handful of global companies and individuals. Yet it’s almost inconceivable that even a congress terrified of further populist revolt would go along with this. And even if they would, unless trust busting was truly global, such breakups would amount to the unilateral surrender of most of the world’s markets to the large multinationals based in other countries. Baidu and Taobao would fill the void left by a shattered Google or Amazon.

Trumponmics as of now is merely a set of assumptions and aspirations that are unlikely to survive their impact with reality because they reject or ignore the last several decades of economic change, namely, the move towards services and the rise of truly global companies. We’ll thus have to look elsewhere if we want to see how Trump will try to shape the current economic order while actually recognizing the economic order as it exists today.

I think one of the best places to look for this shape of Trumponomics would be in the thoughts of one of his smartest and richest advisers Peter Thiel (under any other administration I would say notorious) who lucky for us just wrote a book on the subject right on the eve of the election.

In an interview Theil rightly pointed out how the financial bubbles of the last generation have been catastrophic- that the system doesn’t work- and that what separated Trump from Clinton was his open acknowledgement of that fact. Theil also thought Trump’s move away from regulation would shift the balance back towards small business because large firms were not only able to better absorb the costs of regulation but often actively encouraged regulation to thwart upstart competitors.  In his book Zero to One Theil lays out a somewhat different and much deeper view of the current economy, what he sees as its problems, and his proposed solutions to them.

The big problem, as Theil sees it and explains in  Zero to One is that the present has failed to live up to its potential. We are living in the future that was imagined in the 1950’s and 60’s that was full of flying cars, space cities, and house robots, and though the technologies we possess are indeed wonders, we’ve certainly fallen short of those original dreams.

Part of the origin of this failure to reach our technological potential Theil lays at the feet of globalization. It’s not only that he thinks technology is a far more important driver for progress than globalization, he seems to think that globalization has slowed the pace of progress down- as cheap humans fill the role that should have been that of advanced machines or augmented, hyper-productive individuals.

That globalization is an unalloyed good is just one of a whole set of false assumptions Thiel believes is holding us back from our potential. Others include our belief that capitalism and competition are the same thing. In fact they are opposites, the whole goal of capitalism is to establish monopolies (zero to one) that then become the engines of progress.

Another would be that the shape of the future should not (or cannot) be defined in advance. The belief that the future will be better than the present but we have no idea what it will look like Theil calls the “curse of indefinite optimism”. The ultimate consequence of this is the move towards the financialization of the economy:

Finance epitomizes indefinite thinking because it is the only way to make money when you have no idea how to create wealth. (70)

In an indefinite world:

money is more valuable than anything you do with it. (71)

Thiel thinks this absence of an definite future we are trying to build means that the government spends its revenue on transfer programs rather than solving complex problem like “atomic weaponry and lunar exploration.” Such lack of a definite future also infects political philosophy both in its dominant egalitarian (Rawls) and libertarian (Nozick) forms where the goal is the adherence to a principle rather than the achievement of any particular form of society.

Darwinian probabilistic theory has also replaced intelligent design in the biological sciences (I’ve heard this before) the consequence of which is that we’ve lost sight of goals such as indefinite life extension. Yet wouldn’t the shift away from globalization and financialization to domestic production and the real economy not only promote accelerated automation (which Theil wants) but also demand even larger government transfer programs (such as a guaranteed income) which he derides as the application of advanced machines results in Marx’s “army of the unemployed”?

Thiel doesn’t think so but rather sees machines as a way to augment rather than replace human labor and thus better for domestic workers than globalization which truly does replace one worker with another (lower paid) one.

And he doesn’t just think the choices we make are mere political ones about what type of society we want to live in over the next century, but existential questions that will decide our very survival. Theil uses Nick Bostrom’s idea of 4 general futures for humanity- cycles of rise and fall, plateau, extinction, and take off, and argues that only road to human survival is to accelerate our pace towards take off because cycles of rise and fall have become unlikely now that knowledge is global, and plateau in a world of resource competition would likely result in extinction level conflicts.

Who knows how much, if any, of Theil’s views will inform the eventual economic policies of the Trump administration. And while there is certainly some truth to Theil’s diagnoses of our current malaise, what his vision of the future deeply lacks is any vision of justice, global responsibility, sustainability, or concept of the good life. His future is all about building an ever more powerful machine. I can see it in neon floating in space now: The Singularity: brought to you by the “God Emperor” Donald J. Trump.      

Trump and the Iron Heel

The Iron Heel

Like many others, I am still absorbing the shock of Trump’s victory in the presidential election. For the last month I had been on a holding pattern on the blog in the remote chance the pundits and pollsters had gotten this election terribly wrong. They have. Rather than having elected Hillary Clinton who would have preserved the status quo with all its flaws, but also its protections, a large portion of the electorate has chosen to blow up the system and take a dangerous, potentially dystopian turn.

It’s perhaps a good time then to reacquaint ourselves with depictions of American dystopia. Indeed what is perhaps the very first example we have of a dystopia in literature was written by an American and depicted the US under the rule of a right wing dictatorship. Way back during the last presidential election I wrote about Jack London’s now largely forgotten novel, The Iron Heel. I think my analysis of how that novel applies to our own time still holds, and frighteningly, appears on the verge of becoming our reality.


The Iron Heel is a 1908 novel by Jack London. It’s a novel which I think is safe to say is not read much today, which is a shame especially for an Americans, for the setting for what was the world’s first modern political dystopia, a novel written when Orwell and Huxley were just babes in the cradle was the United States itself.

Reading the novel as an American gives puts one in a kind of temporal vertigo. It’s not only like finding a long forgotten photograph of oneself and being stuck with the question “is that really me?”, it as if when one turned the photo over one found a note from scribbled n from yourself to yourself a kind of time capsule rich with the assumption that the past “you” knew who the “you” reading the note would be. It makes you start asking questions like “am I the person who I thought I would be?” and set to pondering on all the choices and events which have put you on, or diverted you from, your self-predicted path.

The Iron Heel tells the story of the rise of , “The Oligarchy”, a fascist state deftly laid in almost all of its details before fascism had even been invented. The fact that London pictures the rise of not only the world’s first fascist regime, but what might be considered the world’s first communist revolution not “out there” in the Old World, but on the familiar grounds of the United States where places like California, Idaho, “Indian Territory”, Chicago and Washington D.C. are the setting for events that are hauntingly similar to ones that would indeed happen in Europe decades later, turn the novel into a kind of alternative history.

The story itself is presented in the form of a kind of time capsule, a buried manuscript that has been discovered by a scholar, Anthony Meredith,  in the year 2,600 AD. Footnotes throughout the book are written from this very long view of the future when, after centuries of repression and false starts, a true Brotherhood of Man has been obtained.

The manuscript,  footnoted by Meredith,  contains the story of, Avis Everhard, the wife and fellow revolutionary of seminal figure in London’s fictional history, Ernest Everhard. Avis tells the tale of an early 20th century America racked by inequality, class divisions, and the most brutal forms of labor exploitation. These conditions set the stage for a looming socialist revolution, a political alliance between industrial labor in the form of a Socialist Party, and American farmers in the Grange Movement, that is preempted by the forces of capital. Ernest Everhard is elected as a socialist US Senator, one of many members of the Socialists and Grange Movement who have been swept into national and state office by the groundswell of support for revolutionary change.

The chance to change American  society through constitutional means does not last long. The Oligarchs use a feigned terrorist incident in the US Capitol to turn the American Constitution into a mere facade. Members of the Grange Movement are barred from taking their seats in state legislatures. Socialists are hounded from office pursued as potential terrorists and arrested. The Oligarchs create new mechanisms of social control.  London, writing before the US had a true and permanent standing Army, describes how The Oligarchs turn the state militias into a national army “The Mercenaries” with their own secret service tied to the police that will act against any perceived challenges to the social order.

Writing a generation before corporatism was even conceived, London describes how this oligarchic coup would manage to divide and conquer the forces of labor by essentially buying off and vesting in the system vital workers such as those in steel or railroads so that crippling general strikes became impossible, and all other unskilled labor was pushed into what we would understand as Third World conditions of bare survival.

These wage slaves would be compelled to build the glittering new cities of the Oligarchs such as Ardis and Asgard. The lower classes are robbed of that singularly American right- the right to bare arms, and only allowed to travel using an internal passport system similar to the one used in Czarist Russia.

Under these conditions, actual revolution brews, and the Oligarchs and the revolutionary forces engage in a protracted struggle of espionage and counter-espionage that for the revolutionaries is to culminate in a planned revolution- essentially a set of coordinated terrorists attacks on US communications and military infrastructure that the revolutionaries hope will spark a genuine revolution against the Oligarchs.

The Oligarchs again set out to short- circuit revolution, this time by staging a massive military assault on the heart of American labor, Chicago. The assault unleashes violent clashes between the well-armed Mercenaries and police forces and howling crowds of the poor armed only with household tools: knives, clubs, axes. In scenes far more gripping than those in Collin’s Catching Fire, London depicts urban warfare between security forces fighting raging crowds and bomb throwing insurgents who attack their targets from the heights of skyscrapers, in a way surely reminiscent of Fallujah, or even more so, what is going on right now in Syria.

Eventually, the oligarchic forces burn the poor sections of Chicago to the ground, and end all chance of successful revolution within the lifetime of the Everhard’s. In such conditions the effort at revolution becomes pure terrorism, the names of the terrorists groups no doubt reflective of the limited geographical area in which they operate and America’s history of resistance to the powers of the federal government such as the Mormon group the Danites or the Comanches. The Oligarch’s suppression of revolutionary forces eventually reaches the Everhard’s. The novel ends abruptly with Avis’s narration stopping in mid-sentence.

The Iron Heel is a kind of warning, and the strange thing about this warning is that London, who was labeled a gloom obsessed pessimists by many of his fellow socialists, got so much of what would happen over the next 50 or so years eerily right, with the marked exception of where they were to occur.

Such prescience is hard to achieve even for someone as brilliant as the fellow novelist Anatole France the author of the introduction to the 1924 edition of the The Iron Heel I hold in my hand. France, who was 80 at the time and would die the same year, thinks London was right, that the Iron Heel was coming, but doesn’t think it will arrive for quite some time. “In France, as in Italy and Spain, Socialism, is for the moment, too feeble to have anything to fear from the Iron Heel., for extreme feebleness is the one safety of the feeble. No Heel of Iron will trouble itself to tread down this dust of a party”. (xiv)

1924 is the same year that the murder of socialist Giacomo Matteotti truly began the fascist dictatorship in Italy- a kind of corporate state that was certainly anticipated by London in The Iron Heel. Within 6 years “feeble” Spanish socialism would be locked in a civil war with fascism, within 9 years, the Nazis would rise to power on the backs of the same sort of fears of revolution, and using the same kinds of political machinations described in The Iron Heel. The bombing of the Reichstag ,which was blamed on the German communists but really committed by the Nazi’s, became the justification for an anti-revolutionary crackdown and the transformation of German democracy into a sham. It makes one wonder if Hitler himself had read The Iron Heel!

The Iron Heel throws up all sorts of historical questions and useful analogies for the current day. Why did neither revolutionary socialism or outright fascism emerge in the US in the 1930’s as it did elsewhere?

The Iron Heel should perhaps be read as part of a trilogy with Sinclair Lewis’ 1936 It can’t happen here! Which describes the transformation of America into a Nazi-like totalitarian state, or Philip Roth’s 2004 The Plot Against America which describes a similar fascists regime which comes about when the Nazi sympathizer and isolationist, Charles Lindberg, win the presidential race against Franklin Roosevelt. Full reviews of both will be found here at some point in the future the point for now being that there were figures and sentiments in American politics that might have added up to something quite different than American exceptionalism during this period. That what we ended up with was as much the consequence of historical luck as it was of any particularly American virtue.

Some, on both the right and the left would argue that what we have now is just a softer version of the tyranny portrayed by London, Lewis, and Roth, and they do indeed have something, but I do not as of now want to go there. The reason, I think, the kind of socialist revolution found in other countries never got legs in the United States the way it did elsewhere was that the US, which had been a hotbed of labor unrest and socialist sentiment and anticipation in the late 19th and early 20th centuries, willingly adopted a whole series of reforms that made worker grievances against capitalism less acute.

  • Unemployment benefits- 1935
  • Eight-hour workday- 1936
  • Worker’s compensation in event of injury (widespread by 1949).
  • Government funded support for the poor that preserved a minimum standard of living- 1935
  • Minimum wage- 1938
  • Right to unionize and the adoption of a formal system to hold strikes- 1935

In addition controls were placed on financial markets so that the kinds of wild swings, financial panics, that periodically brought the nation’s economy to its knees would no longer occur.

Even when derided on the right as moves towards socialism or on the left as delusional reformism, these changes followed by an unprecedented era of prosperity for the middle class from the 1940s through the 1970s, essentially ended the vicious circle presented in the Iron Heel of a political system unresponsive to worker grievances and exploitation that gave rise to forces of social revolution that in turn  engendered a move towards state violence and tyranny by the wealthy elites, which resulted in widespread terrorism by continually frustrated revolutionaries.

As a system for producing widespread prosperity faltered in the 1970s the American right, followed by increasingly centrist Democrats diagnosed the economic malaise as having originated from both the choke hold American unions had over the economy and the stifling effects of too much government interference.  Through the 1980’s and 90’s labor union power was dismantled, economic production globalized, capital markets freed up from earlier constraints, welfare “re-formed”.

Support for the lower classes was now to come not primarily through government programs, but through tax policy, such as the Earned Income Tax, that would free individuals to make their own choices and vest them in the capitalist economic system rather than view them as an opposition. Such reforms with their explicit claim that they would lead to universal prosperity collapsed with the 2008 financial crisis and neither the American right nor the American left has any clear understanding of where we go from here. And while it’s true that programs to support the poor and working class, such as food stamps and health care, expanded the most since LBJ under President Obama, they did so in light of the deepest financial crisis since the Great Depression.


With the 2016 election the Republic may have entered its deepest and most dangerous challenge to its legitimacy since the Civil War. What fills me with trepidation is that the only way to stop the Trumpian turn and preserve the rights and protections built up since the founding may be to engage in the very kinds of resistance and civil disobedience that will feed Trump’s open authoritarianism and disregard for the constitution. If that proves the case Jack London’s dystopia will have arrived, though a century late, and empowered by technologies of surveillance and control he could never have foreseen.