VIKING CAPITOLISM – from investors to looters - how wall street raiders destroyed American Industry and how corporations are finishing off the American economy today with a leveraged buyout of congress and one last rape of a looted economy.

The rich are getting richer. This may be old news, but the story has changed over the last few decades and is reaching a climax here and now.  The rich are getting richer, but not through investing their own money, creating jobs and earning a profit. Not even through the slow and inexorable accumulation of tax benefits which has fueled most of the last quarter century’s gap between us and the wealthy. No, these methods have become old and tiresome. The corporate elite have always seen to it that they reap their share of profit. But not only have their taken more and more than ever before, but now they have figured out a way to make profit out of failure. Before, they were willing to reap the slow steady benefit of special tax breaks and government contracts. That was in a slower, more studied world where the long term was at least taken into effect. The rich lived off the economy but they did not take too much for fear of killing the golden goose.

Well, that was yesterday - today its Foie Gras is on the champagne buffet. Modern financial types have become the ultimate short termers, nothing matters but the quarterly profit – hell, the weekly quota. Starting way back in the 1980s, the financial class in America became addicted to short term profit. Exxon sold its headquarter building and rented it back from Japan. Boeing and GM turned over all their industrial power to China in exchange for some cheap parts to improve the end of the year bonus for a few dozen billionaires.

Capitalism was supposed to be based on investing your money in a company, buying equipment and hiring employees to produce a product and make a steady profit over time. Starting in the 80s American finance moved to a different model – modeled closely on the Viking raiders who looted the monasteries of the middle ages. The new capitalism worked something like this. You created some fake bonds with no backing whatsoever except the potential for loot. You sold those bonds. Now you used someone else’s money to buy a thriving company. Instead of investing in equipment – you pawned it off to pay back the money you borrowed. Instead of hiring employees, you fired them to reduce cost and make the company look better for a short term sale. Soon the useful parts of the company were sold off bit by bit to fill the pockets of the corporate raiders.  As to producing something - what a laugh, that is a job for 9 year old chinese, not American workers. 

After every penny of short term cash was squeezed out, then they dumped the looted, dysfunctional shell of a company back on the market, where it quickly faded into bankruptcy. Companies that had built wealth and jobs for almost 2 centuries were looted of all their cash and had their best assets sold off to back high interest debt so that the raiders could raid great businesses and leave them ruined.  It became so bad that corporations learned that to keep cash on hand was the best way to invite a corporate raid.  We actually trained the few businesses that were not destroyed that cash on hand was bad, not just bad but actually dangerous.

That was yesterday, this is today. The fatted calves have all been slaughtered. There is no more quick profit to be had by corporate raiding because there are no more cash rich corporations left in the US. Either the company is saddled with huge debts left it from one or more previous takeovers like Nabisco, or its been drained of cash in bonuses and options for its executives like Disney. Either way there is no more ready cash to be looted in corporate America. Oh sure, there is the occasional deal or perhaps one predator will kill off another and rend their flesh like sharks in a frenzy. The Goldman Sachs manipulation of the fall of AIG is a perfect example of that.

So how do the rich get richer today? Well, once again the Viking model fits, after the Vikings had raped and looted every place they could get to in Europe – after all the portable wealth was gone. They looked around and decided that they would take direct ownership of the people they was merely vandalized every so often. The Vikings put away their loot bags, showed off their immense wealth and nice shiny sword – and sat down on the throne of kings. From Norman England to Sicily to Russia, the raiders became lords. They earned their wealth from the direct taxation of the people.

Today’s corporations are following the same path. With all the cash drained from corporate vaults, they moved on to the little guy. It started with fees for everything from asking how much money you had in their banks to charging loan shark interest on credit cards they handed out like drug laced Halloween candy to a nation addicted to sweets. But that was a starvation diet for a corporate elite used to billions in bonuses. Then the house of cards they had built began to creak. Borrowing money at midnight for a few minutes to pretend you have sufficient reserves to meet federal requirements got harder and harder to do because there was more and more debt to cover. Banks loaned out assets at 32 to 1 and then pretended to have enough cash to cover the 10 to 1 bet which is the American banking system. Loans were made to people clearly unable to pay, just to meet sales quotas. Every kind of fantasy possible was woven into zero down, cash back, balloon payment, mortgages to people who could not currently service their discover card.

Then as people could no longer borrow from peter to pay Paul, it all started to collapse. Suddenly Wall Street was littered with deuces as the house of cards collapsed. Panic set in. The government stepped in to try and bring order. They did what our government always does – they threw money at the problem. This was fatal – when one house was bailed out the other demanded money too. It created a feeding frenzy. When the demands on treasury funds became overwhelming they cut their losses and let Lehman brothers fail. More panic, more calls for government intervention. Now where do you suppose the corporate types were during all this? Not at the strip club or golf course for once. No, they were in comfy leather chairs snuggled up next to their best investments they ever made and the only ones left to them – our congressmen. While the American public was calling in 100 to 1 against the bailouts and being told to quit clogging the lines, the elite were added final flourishes to the biggest corporate raid ever made - a takeover (I would question whether it was hostile) of the American treasury.

In a matter of days the taxpayer became the latest and greatest buyer of junk bonds ever. The Federal Reserve printed trillions of dollars worth of bonds and then bought them back with money warm from their own presses. Nothing backs those Fed bonds but an obligation for the people to pay and the goodwill of the US government. Meaning nothing backs those bonds except the obligation for the people to pay. We will never be able to pay them of course and sooner or later the US bonds will go the way of all junk bonds – down.

That is a tale for another time. But I would like people to think why we defend a system that is supposed to be based on investing money to produce jobs and profit, when it is in fact – at least at the top, become a systemized looting of wealth from the people at the bottom of the scale. The corporate elite had let their wanton greed and financial barbarism destroy most of the real wealth and job producing business in America. The rich in this country have moved from creating wealth to stealing it. If they cannot convince you to buy their phony scams any longer, they simply have their congressional lackeys take the money from you in taxes and debt and the profits of the ruling class remain guaranteed.

This manipulation of the financial industry, the looting of real business and the leveraged buyout of our government has gone from slow and insidious to swift and arrogantly open. Yes the rich are getting richer. They are doing so with such rapidity and with such naked greed and contempt for democracy and their own purported capitalism that one wonders whether we even live in anyplace like the America we tell the world about. Wealth in this country is more centralized than in any previous culture. The Czarist nobles and French aristocrats had far less control over total wealth that do today’s nabobs of Wall Street and the lords of international corporations.

Wake up people, we have found ourselves right in the middle of an apocalypse – we have meet the enemy and it is them! The Vikings would be proud. Hail Odin! and toss another peasant on the fire.