The elites who control international finance are the best educated people in the world. They are also the most dangerous and have inflicted the most harm.
This article was originally published in the author's Patreon.
In the autumn of 2000, I traveled to the southern African nation of Mozambique to write a story about the collapse of the country’s cashew industry. Sixteen years of ruinous civil war had left Mozambique’s cashew groves in bad shape, and the local processing plants unable to afford the raw nuts that were being snatched up by buyers on the international market.
To insulate a key industry from foreign competitors, Mozambican officials slapped a stiff export tax on homegrown cashews, which kept local factories awash in raw nuts, but artificially lowered the price that peasant farmers could fetch for their crops on the open market.
Hoping to revamp their state- managed economy following the Soviet Union’s breakup, Mozambican officials began playing ball with the World Bank and International Monetary Fund in the mid- 1990s, agreeing, in the main, to the laissez-faire policies championed by both lenders. Where Mozambique drew the line however, was the export tariff on cashews; repealing it, they argued, would surely shutter the cashew factories, and throw thousands out of work.
World Bank and IMF officials, for their part, dug in their heels and refused to renew their loans to Mozambique unless the government lifted the tariff, which would enable peasant farmers to sell their nuts for higher prices overseas. Threatened with losing nearly $650 million in loans, Mozambican cabinet ministers and lawmakers relented, and began phasing out the tariff in 1996. "Sometimes," Prime Minister Pascoal Manuel Mocumbi told reporters at the time, "we have to accept things that are not in our interest because there is no other way out."
Four years later, the policy had almost killed off the nut trade. By the time I traveled to the country, 10 of Mozambique’s largest cashew-processing factories had closed because locally produced nuts were being shipped abroad, costing nearly half of the industry's 12,000 factory workers their jobs. And worse still was that the smallholder farmers who were supposed to benefit from free trade told me that the only people who profited were scores of new middlemen –virtually all of them foreigners – who began to roam the countryside buying up nuts to sell on international exchanges.
Faced with incontrovertible proof of their miscalculation, the Bank and IMF allowed Mozambique to restore the export tax although the industry never fully recovered. "We agree that liberalization is generally a good idea,”Jose Antonio Justino Nhalungo, director of the Foreign Ministry told me in 2000. “But this was a complicated issue, and the Bank believed they knew better than us how to deal with this issue, and we never had a real dialogue on the matter.”
Still a bit perplexed, I asked Nhalungo why he thought the Bank did not trust the judgement of the people who were closest to the issue? He paused as we had coffee at a seaside cafe overlooking the Indian Ocean, and said, exasperatedly:
“We did not go to Harvard, I suppose."
With a quisling news media that eschews fact for fabulism and context for caricatures, it’s easy to lose sight of who, ultimately, is responsible for the increasing frequency and severity of the economic crises experienced by the U.S. over the past 35 years, or a global economy –from Sri Lanka to South Africa and Argentina to Zimbabwe – that is today teetering on the brink of disaster.
But if we scrutinize our immiseration as a coroner might autopsy a mutilated corpse, then the fingerprints of a serial killer comes into sharp focus. Look closely at the implosion of Mozambique’s cashew industry and you can clearly discern the chalk outline of Chile’s financial downfall nearly 50 years ago at the hands of the Chicago Boys, a coterie of economists educated at the prestigious University of Chicago under the tutelage of Milton Friedman, whose theories on privatization, deregulation, and speculation would inform Reagan’s supply-side macroeconomic policies, and those of the IMF, World Bank, World Trade Organization, and European Union in the post-Soviet Union period.
The result is recession at home and riots abroad In fact, you cannot point to a single country in the world today that is better off economically for following the advice of the financial whiz kids from the University of Chicago, Stanford, Duke, Cal- Berkeley, the Ivy League or any of the Western institutions that are most often credited with producing our nation’s political class.
This disconnect raises an obvious question: if our so-called best and brightest are so Goddamn smart, why is everyone so effing broke?
Our undoing as a nation lay in putting our trust in a confederacy of dunces. We the people– if I may paraphrase America’s greatest autodidact, Malcolm X– have been hoodwinked, bamboozled, and led astray by the progeny of the very con men who persuaded us that an invasion by the Vietnamese was imminent, Nelson Mandela was a terrorist, ketchup is a vegetable, Cadillac-driving welfare moms were the reason we couldn’t have nice things and everyone would prosper by shipping the manufacturing sector overseas.
What we today know as neoliberalism began nearly 40 years ago as the 1 percent’s response to the New Deal’s Keynesian ethos and the tandem of radical black power activists and white Leftists who were demanding an increasingly larger share of national income, thereby gobbling up corporations’ windfall profits. While neoliberalism is often defined as adherence to classical trade principles, Adam Smith never imagined a capitalist system in which the state, and all of its institutions, act as guarantors of investors’ profits.
Hence, the 1973 coup d’etat in Chile triggered a reorganization of the global economy that, in each and every instance privileges the sellers over the producers, lenders over borrowers, and employers over their employees. With few exceptions, Ivy League elites and their peers are seditious counterrevolutionaries tasked with subduing the democratic will of the people, and managing what is, in effect, a worldwide criminal enterprise, based on theft and murder.
To speak plainly, only workers’ can solve workers’ problems, only Africans can address African problems and only women can fix the issues that vex them specifically. The IMF can no more curb Mozambican poverty than Harvard economists can manage the disintegrating Soviet Union’s transition to a market economy or Mark Zuckerberg can fix Newark’s public schools. As the Marxist historian E. P. Thompson wrote in his iconic book, The Making of the English Working Class, “the working class made itself as much as it was made,” and as such needed no condescending Ivy League asshole to tell it how to get ahead.
With only a few exceptions, the elites advertised as our best and brightest are, in fact, the greatest collection of degenerate morons ever assembled within the borders of a single country.
What, other than sheer idiocy, could’ve inspired the dull-witted George Washington to demand that an escaped slave return to his plantation of her own volition?
How brilliant was Columbia University history professor William A. Dunning, whose reconsideration of radical Reconstruction built the intellectual edifice for Jim Crow’s campaign of terror against blacks? What should we make of the late U.S. Senator and Harvard scholar Daniel Patrick Moynihan’s theory that African Americans’ poverty was attributable to a “tangle of pathologies” and not racial discrimination by banks, schools, police, employers and even labor unions?
How will history remember Larry Summers, the former U.S. Treasury Secretary and Harvard president who tore down the firewall between bank depositors and speculators, questioned women’s aptitude for math and science 30 years after the scientific community concluded that women were innately more skilled in those areas than are men, and whose bad investment advice cost Harvard nearly $2 billion. And how to explain the nation’s first black president, Barack Obama, an Ivy leaguer who taught constitutional law at the University of Chicago, and insisted that he was entitled to kill anyone, anywhere in the world without a scintilla of evidence.
Obama’s eight years in the White House serves to confirm Adam Clayton Powell’s assertion that “Harvard has ruined more Negroes than bad whiskey.” Indeed, such ruination has been a point of emphasis since a radical black power movement began lifting the nation’s consciousness in the mid 1960s, challenging the European settler states’ attempt to qualify its crimes against humanity, and raising the population’s revolutionary metabolism. By the time that the corporate attorney and soon-to-be-Supreme Court Justice Lewis Powell submitted his confidential memorandum to the U.S. Chamber of Commerce in 1971, it was widely understood that the elites could only maintain power by enticing African Americans to join them in their endeavor to dumb down the masses.
Of the five Supreme Court justices who voted last month to overturn Roe v. Wade, four graduated from Ivy League universities, including Clarence Thomas, the court’s lone African American jurist at the time. In an open letter to Thomas following his 1991 confirmation to the U.S. Supreme Court, another African American jurist, A, Leon Higginbotham downplayed the importance of the Ivy League in the administration of law, writing:
“The most wretched decision ever rendered against black people in the past century was Plessy v. Ferguson. It was written in 1896 by Justice Henry Billings Brown, who had attended both Yale and Harvard Law Schools. The opinion was joined by Justice George Shiras, a graduate of Yale Law School, as well as by Chief Justice Melville Fuller and Justice Horace Gray, both alumni of Harvard Law School. If those four Ivy League alumni on the Supreme Court in 1896 had been as faithful in their interpretation of the Constitution as Justice John Harlan, a graduate of Transylvania, a small law school in Kentucky, then the venal precedent of Plessy v. Ferguson, which established the federal ‘separate but equal’ doctrine and legitimized the worst forms of race discrimination, would not have been the law of our nation for sixty years.”
The notion of social transformation from the bottom-up is not an academic matter but especially salient in light of the reemergence of a multipolar world, and the strengthening of ties between Russia and China to rival Western hegemony in the postwar era. This is the first in a series of articles exploring grassroots solutions to rebuild the U.S. generally, and colonized black communities specifically.
Suffice it to say for now that Frederick Douglas was indeed correct when he predicted that if we are to be saved, it will be by the crew and not the captain, as was Otto in the 1978 movie Animal House when he admonished Flounder for loaning his car to his fraternity brothers:
“You fucked up; you trusted us.”
A former foreign correspondent for the Washington Post, Jon Jeter is the author of Flat Broke in the Free Market: How Globalization Fleeced Working People and the co-author of A Day Late and a Dollar Short: Dark Days and Bright Nights in Obama's Postracial America. His work can be found on Patreon.