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CHAPTER 11
Empire’s Victory

This is an impressive crowd. The haves and the have-mores. Some people call you the elite. I call you my base.¹

George W. Bush

We can either have democracy in this country, or we can have great wealth concentrated in the hands of a few, but we can’t have both.

Louis Brandeis, U.S. Supreme Court Justice (1861–1939)

Extreme inequality is the surest indicator of a society organized by the dominator relationships of Empire. It is no coincidence that the United States has the most unequal wealth distribution of any major industrial nation and is the most imperial of modern nations.

In 1998, the top 1 percent of U.S. households owned 47 percent of all household financial assets, more than the entire bottom 95 percent— and the gap is growing. In the decade between 1989 and 1999, the number of U.S. billionaires increased from 66 to 268. The number of people living below the pitifully inadequate official poverty line (about $13,000 for a family of three in 1999) increased from 31.5 to 34.5 million. The ratio of CEO pay to the pay of an average worker rose from 141 to 1 in 1995 to 301 to 1 in 2003. The legacy of slavery’s destruction of families and its denial of opportunities for intergenerational wealth accumulation by black Americans is revealed in the fact that the total wealth of the average European American household is 5.5 times that of the average African American household.²

For more than thirty years, political science professor Thomas Dye has been documenting in a series of studies titled Who’s Running America? just how small the U.S. ruling class is. In the 2001 edition, which documented elite rule under the then newly established administration of George W. Bush (Bush II), Dye identified 7,314 individuals, out of a U.S. population of 288 million, who by their positions of power and authority controlled

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almost three-quarters of the nation’s industrial (nonfinancial) assets, almost two-thirds of all banking assets, and more than three-quarters of all insurance assets, and… directed the nation’s largest investment firms. They commanded over half of all assets of private foundations and universities and controlled the television networks, the national press, and the major newspaper chains. They dominated the nation’s top law firms and the most prestigious civic and cultural associations, and they occupied key federal government posts in the executive, legislative, and judicial branches and the top military commands.³

These are truly America’s Cloud Minders, members of a privileged elite that rule from a separate world of luxury and privilege far above the mundane. Traveling in private jets and chauffeured limousines, attending elite schools, living in gated communities and private estates, socializing in exclusive clubs, and getting their news from elite publications and news services that cater to an exclusive audience, these are the have-mores who live in world far removed from the mere haves, let alone the have-nots.

The 2004 U.S. presidential race between George W. Bush and John Kerry, two white males from wealthy families who had each graduated from Yale University and belonged to the Skull and Bones society, underscored the narrowness of the path to the highest positions of political power. Indeed, the two presidents prior to Bush II, Bill Clinton and George H.W. Bush, also held degrees from Yale University, and Bush I had also been a member of Skull and Bones.

As history and a close reading of the original U.S. Constitution make clear, the intention of the architects of what we look to as American democracy was not to create a democracy; it was to create a plutocracy, a nation ruled by a wealthy elite—and they were very successful. Their efforts are worth a brief review, not only to remind ourselves of the realities of our history, but also to comprehend how past misdeeds and slanderous political rhetoric formed a template for our own time.

WHO WILL RULE? A NATION BY, FOR, AND OF WHITE MEN OF PROPERTY

The members of the Continental Congress who had issued the Declaration of Colonial Rights in 1774 and the Declaration of Independence in 1776 were all white male property owners named as representatives to 183the Congress by colonial legislative bodies, which themselves comprised white male property owners. Many, including Jefferson, included slaves in their property. It was the same for the Constitutional Convention. The free male laborers, who enjoyed minimal rights, and the women, slaves, bonded workers, and Native Americans, who had no legal rights, made up more than 90 percent of the population of the new nation, but had no representative in either body.

To Insure Domestic Tranquility

The decision to establish a strong federal government following the successful conclusion of the Revolution was prompted in consequential measure by Shay’s Rebellion of 1786–87. Farmer patriots who had fought on the side of liberty for worthless government IOUs had, in the classic pattern of Empire, returned home to face bankruptcy and foreclosure on their farms at the hands of financiers whose patriotic service in the war had been limited to profiteering.⁴

Their resentment gave rise to an armed rebellion in defiance of court-issued foreclosure orders. Authorities called on the local militia to defend the courts and the law of the land. The citizen militia, however, was composed largely of armed farmers who sided with their neighbors. A group of wealthy Boston merchants eventually financed an army to put down the uprising.

The advocates of popular sovereignty considered Shay’s Rebellion an exhilarating example of an active and organized citizenry seeking a redress of grievances against an abusive establishment—much as the minutemen had come forth in opposition to the British Crown. The elite establishment considered Shay’s Rebellion to be an unsettling example of the dangers of mob rule and convened a Constitutional Convention in 1787 to create a strong federal government with the power to raise an army to impose domestic order. Article I, Section 8 of the U.S. Constitution gives the Congress the power to “provide for calling forth the Militia to execute the Laws of the Union, suppress Insurrections and repel Invasions.” It is telling that executing the law and suppressing insurrection both come before repelling invasions in order of priority.

The bold vision of liberty and justice for all spelled out in the Declaration of Colonial Rights and the subsequent Declaration of Independence and signed earlier by members of the Continental Congress in a moment of revolutionary fervor was nowhere in evidence in the original 184Constitution. Those who drafted it were no longer concerned with protecting their rights against a distant king, but rather with securing their power in the new nation. This post-Revolution reality brought forth a division within the ranks of the delegates to the Constitutional Convention, personified by two men: Thomas Jefferson and Alexander Hamilton.

Jefferson’s Democracy versus Hamilton’s Plutocracy

Jefferson, a leading voice for democracy, had an abiding faith in the wisdom of ordinary people and believed that democracy properly rests on the bedrock of economic democracy and a strong middle class. Much like Aristotle, he championed a nation of land-owning family farmers and independent artisans who would own the land and tools essential to their crafts and livelihoods. Jefferson’s greatest fear was that America might come to mirror Europe’s deep divisions between a hereditary class of pretentious and unproductive aristocrats and a hereditary class of the desperately poor. In his ideal, all men would be men of property. He once said, “I am not among those who fear the people. They and not the rich are our dependence for continued freedom.”⁵

In his reference to those who fear the people, Jefferson no doubt had in mind Alexander Hamilton, the unabashed champion of elite rule, who once asserted:

All communities divide themselves into the few and the many. The first are the rich and well born, the other the mass of the people. The voice of the people has been said to be the voice of God; and however generally this maxim has been quoted and believed, it is not true in fact. The people are turbulent and changing; they seldom judge right. Give therefore to the first class a distinct permanent share in the government.⁶

Suspicious of the masses, Hamilton equated democracy with mob rule and felt that to become a strong nation America must concentrate power in a class of wealthy aristocrats able to organize and lead the nation to imperial greatness. At the Constitutional Convention Hamilton proposed that a president and a senate be chosen for life.⁷

Underlying the differences between Jefferson and Hamilton is the basic truth that those who do not own property live in subservience to those who do. The U.S. Constitution represented a partial compromise 185between Jeffersonians and Hamiltonians, but the latter largely prevailed. The United States would be a constitutional plutocracy —more politely, a republic—a democracy of elites in which the propertied classes establish priorities and agendas and from time to time compete among themselves in open elections for the favor of lesser classes. In the end, the Constitution proved an artful exercise in securing the rights and privileges of property while granting enough liberty to the common man to discourage rebellion.

CONSTITUTIONAL PLUTOCRACY

George Mason, a delegate from Virginia, led the demand that the Constitution include a “bill of rights.” Mason lost the battle in the Constitutional Convention. Freedom from England had been won, and the majority of the delegates now felt that the constitutional provisions securing slavery, free trade among the states, creditors’ rights, and an electoral system that assured them control of the institutions of government provided all the protection they needed. They felt no need for a bill of rights.⁸

Guarantees for Slavery, Free Trade, and Creditors

The Constitutional Convention was strongly influenced by three sets of propertied interests. Northern industrialists wanted a single market with uniform rules established at the federal level, and a common external tariff system free of interference by state regulators, so that they could secure unrestricted access to a unified market. They got the interstate commerce clause of the Constitution, which effectively guarantees an integrated national market beyond the reach of state legislators, much as contemporary trade agreements guarantee global corporations global access to national economies, free from interference from national legislators and regulators.

Northern financiers wanted to secure their right to collect on debts owed to them irrespective of the state in which the obligation was contracted. They won provisions giving the federal government the power to prohibit the individual states from granting relief to indebted farmers, issuing their own currencies, allowing debts to be repaid in anything but gold and silver, or making any laws invalidating contracts 186such as mortgages and loans.⁹ These provisions secured the rights of creditors and assured the classic pattern of wealth transfer from the working classes to the owning classes.

Southern plantation owners sought to secure the institution of slavery. They got provisions barring Congress from prohibiting the importation of slaves before 1808 and prohibiting one state from providing sanctuary to a slave or bonded laborer from another.

Only Cloud Minders Need Apply

The elite bias is also evident in other provisions of the original Constitution. For example, state legislatures, which as noted above comprised white male landowners, would appoint the state’s two senators. An Electoral College comprising members similarly appointed by the state legislatures would choose the president.

The ultimate guarantee of elite privilege was the constitutional provision for a powerful high court composed of justices appointed for life by the president, with the power to overturn virtually any act of the legislative and executive branches of government. As a practical matter, appointments to the Supreme Court are available only to graduates of elite law schools, which at the time were open only to sons of the propertied class. As demonstrated by the U.S. Supreme Court’s appointment of George W. Bush as president in 2000, the law is whatever a majority of the sitting justices choose to say it is. There is no mechanism for appeal or dissent no matter how arbitrary or contrary to established law or the public interest its decisions may be.

The authority of the Supreme Court has at times served the cause of justice, as when a relatively progressive court advanced the cause of civil rights for African Americans and Native Americans in the late twentieth century. The overall record of the court, however, is one of persistent bias in favor of elite interests over broader public interests.

Concession to Public Outrage

The proposed Constitution as put forward for ratification by the states was widely criticized by patriots who saw it quite correctly as a design for plutocracy rather than for democracy. The Federalists—persons of wealth and authority who stood most to benefit from the Constitution as drafted—organized a well-funded campaign to get it ratified as quickly as possible. In a pattern familiar to this day, they circulated false 187reports to discredit opponents. Advertisers put pressure on newspapers that opposed ratification.¹⁰

In the end, most states did ratify, but only with the assurance that a Bill of Rights would be added later. The Constitution was amended accordingly on December 15, 1791, but it took many years and amendments for the Constitution to clearly establish that the protections of the Bill of Rights apply to all persons, not just white men of property.¹¹

The Thirteenth Amendment abolished slavery in 1865. In 1868, the Fourteenth Amendment declared that all persons born or naturalized in the United States and subject to its jurisdiction were citizens and thereby entitled to the equal protection of the law. In 1870, the Fifteenth Amendment declared that no citizen could be denied the right to vote because of race, color, or previous condition of servitude. It was not until 1920, nearly 150 years after the founding, that the Nineteenth Amendment recognized women as persons entitled to the full rights of citizenship by prohibiting any denial or abridgement of the right to vote based on sex. From our contemporary perspective these advances seem painfully slow, yet within the context of five thousand years of Empire they came with remarkable speed.

THE FEDERALIST PROGRAM

The contrasting visions of Hamiltonian plutocracy and Jeffersonian democracy played out in the subsequent political division between the Federalist Party of Hamilton, Washington, and Adams and the Democratic-Republican Party of Jefferson, Madison, and Monroe. Merchants and financiers backed the Federalists. Planters, farmers, and artisans favored the Democratic-Republicans.¹²

Profiteers before Patriots

Alexander Hamilton, the champion of plutocracy, served as the first U.S. secretary of the treasury under President George Washington (1789–97). When the administration of George Washington took office, the costs of the Revolutionary War had put the new nation in financial crisis. Hamilton seized the moment.

In the name of securing the government’s creditworthiness, he sponsored a program to redeem all wartime debts of both federal and state governments at face value—including notes issued to soldiers in lieu of 188pay. Providing due compensation to soldiers and others who had borne the burdens of the war would seem to be a noble act, except that by this time the original debt holders had sold most of the debt papers for a pittance to speculators. Indeed, prior to the public announcement of Hamilton’s plan, wealthy Federalist supporters and officeholders with insider knowledge scoured the country for federal and state debt instruments, bought them up at deep discounts from the unknowing, and then redeemed them at face value for tidy profits when the plan was implemented.¹³

Adding insult to injury, Hamilton raised the funds to pay for the debt redemption by levying a tax on whiskey production, which placed the burden primarily on small farmers in the backcountry, many of whom had been the original holders of scrip issued for military service. The understandable outrage sparked the armed Whiskey Rebellion of 1794 in western Pennsylvania. No longer dependent on local militia, President Washington ordered 13,000 troops into the area to put it down.

Private Profit from Public Credit

Hamilton also founded the privately owned First Bank of the United States (1791–1811), chartered for twenty years by the Congress to serve as a repository for federal funds, to act as the government’s fiscal agent, and to make loans to both governments and private interests. Some say it was a stroke of financial genius that set the stage for the United States to become a world economic power. Others revile it as a major fraud against the public.

The bank’s charter, issued in 1790, called for a total capitalization of $10 million, of which $2 million was to come from government and $8 million from private investors. The government put in its contribution. The private shares were quickly bought, but many of the private subscribers made only small down payments and never paid the balance.¹⁴ It appears that the private investors who placed little or none of their own capital at risk reaped significant profits as the beneficial owners of an enterprise financed almost entirely by public money and credit.

When the bank’s charter came up for renewal, the renewal application was rejected and the bank expired in 1811.¹⁵ It was followed by the Second Bank of the United States (1816–36), and ultimately by the Federal Reserve System, established in 1913, which is likewise run by private bankers under the guise of being a public institution and which accomplishes 189much the same outcome of creating private wealth from public assets and credit through a more sophisticated and less transparent process.¹⁶

Criminalizing Dissent

When the Federalist John Adams succeeded the Federalist George Washington to become the second U.S. president (1797–1801), with the Democratic-Republican Thomas Jefferson as his vice president, the nation was experiencing wrenching political tension. Religious fundamentalists had revived the witch trials and were railing against atheists —who by the reckoning of the fundamentalists included deists such as Tom Paine, Thomas Jefferson, and others who professed a belief in God but rejected the fundamentalists’ claims to exclusive truth.

Adams persuaded the Federalist Congress to pass the Alien and Sedition Acts—a forerunner of the Patriot Act of Bush II—to suppress political dissent and undermine support for Jefferson’s party. The Sedition Act made it a criminal offense to publish false or malicious writings against the government or to incite opposition to any act of Congress or the president. The Sedition Act was used to arrest twenty-five men, most of them editors of newspapers sympathetic to Jefferson, and force the closure of their newspapers. Adams also packed the federal judiciary with extreme conservatives—foremost among them Chief Justice John Marshall, who throughout his term from 1801 to 1835 stood steadfast for protecting the interests of property.¹⁷

THE JEFFERSONIAN PROGRAM

Partly in response to public outrage against the Alien and Sedition Acts, Jefferson won the presidency in 1800, in spite of warnings from Federalist opponents that his victory would evoke the “just vengeance of an insulted heaven,” with “dwellings in flames, hoary hairs bathed in blood, female chastity violated… children writhing on the pike.”¹⁸

As president, Jefferson brought a halt to the excesses of the Adams regime, nullified the Alien and Sedition Acts, and signed into law the Act of 1808, ending the importation of slaves.¹⁹ The Democratic-Republicans, with wide support from white working men, began to break the Federalist hold on state and local governments, increased the proportion of local officials subject to direct election, began to provide for public education, eliminated imprisonment for debt, and stopped enforcing indenture 190contracts for craft apprentices. Jefferson’s party was successful in all but three states in winning voting rights for every white male citizen irrespective of whether they were property owners. All but two states moved to choosing presidential electors by direct election rather than leaving their selection to state legislators.²⁰

In the end, however, Jefferson’s program featured Empire with a more friendly and democratic face. For all the acrimonious and sometimes violent tension between the parties, the underlying power structure and bias for elite privilege remained remarkably stable. Federal policies continued to allow slavery, favor big industrialists and financiers, and advance the forceful appropriation of Native lands by the U.S. Army.²¹

The defining act of Jefferson’s administration was to negotiate the Louisiana Purchase from France in 1803, thereby doubling the size of the United States, providing a safety valve for the pent-up tensions of America’s deep class conflict, and removing potential imperial competitors from the nation’s immediate borders. In an early demonstration of the gift of American politicians for Orwellian doublespeak, Jefferson dubbed the expanding U.S. nation “An Empire for Liberty.”

WESTWARD EXPANSION

Hardy pioneers were attracted to the newly opened frontier by the promise of freedom from rent collectors, legalized loan sharks, and other institutions of imperial bondage. Yet the predators were quick to follow, and the newly established free farmers all too soon found themselves back in debt, yielding to the local bank its annual pound of flesh — until a bad harvest brought default and the bank claimed everything. The passions that might otherwise have been channeled into open revolt were defused by the continuing promise of yet more virgin territory just beyond the horizon. The United States became a nation of restless, rootless vagabonds, bags always packed and one foot on the wagon.²²

After the Louisiana Purchase came the War of 1812, which opened the way for expansion into Florida, Canada, and Indian territories further to the west.²³ When Mexico won its independence in a revolutionary war against Spain, its territory included what are now the states of Texas, New Mexico, Utah, Nevada, Arizona, California, and part of Colorado.

Ignoring Mexico’s claims, as they ignored the claims of the indigenous peoples, thousands of settlers poured into Mexican territory from 191the United States with the support of the U.S. government. During the Mexican-American War that followed, the United States annexed by brutal armed force half the total territory of Mexico. The only provocation from the Mexican government was its justified attempt to protect its rightful territory.²⁴

The westward expansion followed a common pattern. Missionaries who offered schools, hospitals, and salvation led the way. Traders, land speculators, mineral prospectors, and farmers soon followed. Then came the railroad, banking, and resource-extraction corporations to consolidate control over the land and its resources. When the indigenous people mobilized in resistance, the military stepped in as needed to secure the claims to land and resources established by the missionaries, settlers, and corporations.

IMPERIAL CORPORATIONS

With memories of the abuse of corporate monopoly power fresh in mind, public sentiment in the early days of the new nation demanded strict limitations on corporate charters. Consequently, state legislatures issued such charters only for fixed periods to serve narrowly defined purposes, kept a close watch on corporate operations, and retained the power to revoke charters at will. It was also common practice to place specific limits on corporate borrowing, ownership of land, and even profits. Owners were held personally liable for all debts incurred during the period of their participation, large and small investors had equal voting rights, interlocking corporate directorates were prohibited, and one corporation was not allowed to own shares in another—all bothersome restrictions resented by powerful interests.

The U.S. Civil War (1861–65) marked a turning point for the U.S. corporation. The country was in chaos and divided against itself. The federal government was beholden to the military contractors who provisioned the troops in the field. Political corruption flourished as industrial interests used the outsize profits from military contracts to curry favor with politicians to further inflate their profits and thus their ability to pay for yet more political favors in their campaign to eliminate legal constraints on the freedom of corporate action.

Powerful railroad corporations led the way, through manipulation of public opinion, legislatures, and the courts. In one early victory for 192corporate interests, the Pennsylvania legislature removed the restriction on one corporation’s owning shares in another. This seemingly innocuous change greatly increased the financial leverage of an individual corporation by allowing it to acquire controlling interests in other companies without having to put up sufficient capital to buy them outright.

Step by step through courts and legislatures—rarely with public debate or notice—corporations eliminated the restrictions on their freedom of action. By the beginning of the twentieth century, corporate charters were being issued automatically on demand with no limits on life span, mobility, or purpose. Owners had gained exemptions from liability, and corporations had become virtually immune to charter revocation. Protections for minority shareholders were largely eliminated, allowing a consolidation of the power of the larger shareholders.

Through courtroom victories, corporations successfully claimed the status of legal personhood entitled to the same constitutional protections accorded to real persons under the Bill of Rights. Most of it happened with no public discussion and even without the vote of elected legislators.²⁵

GOING GLOBAL

In 1823, even as the westward expansion was still in progress, President James Monroe enunciated the Monroe Doctrine as a cornerstone of U.S. policy. The publicly expressed intent was to protect independent Latin American and Caribbean nations from efforts by European powers to recolonize them; the implicit message was that the United States claimed hegemony over the Western Hemisphere.

Theodore Roosevelt took the Monroe doctrine a step further during his presidency (1901–9), announcing that the United States claimed the right to intervene in the internal affairs of any nation that engaged in “flagrant and chronic wrongdoing.” Future U.S. administrations defined this to mean any nation that transgressed against a U.S. trade or investment interest. A 1962 U.S. State Department report to the Congress listed 103 U.S. military interventions in the affairs of other countries between 1798 and 1895, including interventions in Argentina, Japan, Uruguay, China, Angola, Hawaii, and Nicaragua. The reasons were often obscure but usually related to the investments of one or more U.S. corporations.²⁶ 193

In the Spanish-American War (1898) the United States expelled Spain from Cuba and took possession of the Philippines, claiming it was fighting on behalf of Philippine independence. In the subsequent peace treaty, Spain ceded Guam, Puerto Rico, and the Philippines to the United States. A long and bloody U.S. war against determined Filipino resistance followed.²⁷

Visions of imperial grandeur danced in the heads of politicians, missionaries, and the Daughters of the American Revolution. One exuberant advocate who later became a U.S. senator declared,”We are a conquering race…. American law, American order, American civilization, and the American flag will plant themselves on shores hitherto bloody and benighted, but by those agencies of God henceforth to be made beautiful and bright.”²⁸

In 1893, U.S. citizens who had settled in Hawaii as the ungrateful guests of the kingdom organized a rebellion to overthrow Queen Liliuokalani. A detachment of U.S. soldiers and marines was dispatched to “protect American property and lives.” A provisional government formed under U.S. supervision promptly signed an annexation agreement with the United States.²⁹

In the first half of the twentieth century, in addition to World Wars I and II, U.S. Marines invaded and occupied Cuba from 1898 to 1902, Panama from 1903 to 1914, Honduras six times between 1911 and 1925, Nicaragua in 1912 and again from 1926 to 1933, Mexico in 1914 and 1916, and Haiti from 1915 to 1934.³⁰

The pattern of U.S. expansion abroad was similar to that of the westward expansion except the goal was to expropriate agricultural lands and resources to produce goods for export back to the United States. Usually, those resources belonged to indigenous peoples, and the terms of the expropriation served to enrich the local elites, and thereby win their support. Missionaries led the way; corporations followed to organize management and extraction. The U.S. military intervened when necessary to put down resistance and depose uncooperative leaders. It was an offer most ruling elites could not refuse.

The role of the missionaries in imperial expansion was closely akin to that of the Trojan horse, the hollow wooden construction presented by the Greeks to Troy as a gift in a ruse that placed Greek warriors inside the city walls with a mission to open its gates to the invading Greek army. The missionaries offered gifts of medicine, clothing, reading, and 194salvation. Their ministrations opened the gate of trust; corporations poured in to sack the lands and economies. In a world of Empire, there is wisdom in the ancient warning “Beware of strangers bearing gifts.”

Following World War II the tainted gifts came, not from missionaries, but from foreign aid agencies, most particularly loans from the World Bank and regional banks that operated in its image. The official aid-dispensing agencies appropriately referred to their local offices and planning teams as missions. Economists steeped in the religion of neoclassical economics took on the missionary role of preaching stories of the salvation that converting to unregulated markets, open borders, and foreign borrowing would bring. The proselytes, however, did not become the saved souls of Christianity but international debtors in the church of global capital.

DRIVE TO IMPERIAL HEGEMONY

The only serious rival to U.S. global imperial hegemony following World War II was the Soviet Union. The aftermath of the war set the stage for a grand confrontation between the two superpowers.

Design for a Grand Area

Even before the Japanese bombed Pearl Harbor in December 1941 and drew the United States into World War II, a U.S. foreign-policy elite was laying the groundwork for postwar U.S. initiatives that would capitalize on the consequences of the war and create an integrated global economy dominated by U.S. interests. Haunted by the specter of the Great Depression, State Department planners believed that to curb capitalism’s boom-bust cycles, the United States would have to either move to a form of socialism or secure adequate export markets to absorb goods produced in excess of domestic demand. They chose the latter.

Memorandum E-B34, presented on July 24, 1941, by a joint planning group to the president and the State Department, outlined the concept of a “Grand Area.” This was the geographic area the planners estimated the United States would need to dominate economically and militarily to assure materials for its industries while experiencing the fewest possible stresses, “such as unwieldy export surpluses or severe shortages of consumer goods,” that might lead to economic “disintegration.”³¹ 195

The preferred scope of the Grand Area encompassed the entire Western Hemisphere, the United Kingdom, the remainder of the British Commonwealth and Empire, the Dutch East Indies, China, and Japan. It would be expanded by weaving in other areas as circumstances permitted.

The strategic concept called for the initial economic integration of as much of the core area as possible. The more fully the Grand Area could be opened to unrestricted trade and foreign investment, the more readily the economic interests of the United States, as the strongest economic power, would be able to dominate it.

The public version of the Grand Area strategy, which was intended to rally the support of those who would be the imperial subjects, called for the creation of a free and equal community of nations and gave birth to the United Nations.

The real intention of the United States was articulated in U.S. State Department Policy Planning Study 23, a top-secret document written in 1948 by George Kennan, a leading architect of the post–World War II world.

We have about 50% of the world’s wealth, but only 6.3% of its population.… In this situation we cannot fail to be the object of envy and resentment. Our real task in the coming period is to devise a pattern of relationships which will permit us to maintain this position of disparity.… To do so, we will have to dispense with all sentimentality and day-dreaming; and our intention will have to be concentrated everywhere on our immediate national objectives…. We should cease to talk about vague… unreal objectives such as human rights, the raising of living standards, and democratization. The day is not far off when we are going to have to deal in straight power concepts. The less we are then hampered by idealistic slogans, the better.”³²

This was the real agenda, and the agencies of its implementation would be the Bretton Woods institutions: the World Bank, the International Monetary Fund (IMF), and the General Agreement on Tariffs and Trade (GATT).³³ In 1995, the World Trade Organization (WTO) replaced the less powerful GATT.

The difference between the public and private visions was similar to the difference between the professed ideals of the U.S. Declaration of 196Independence, which was a document intended to mobilize popular support, and the reality of the U.S. Constitution, which institutionalized the power and privilege of a ruling plutocracy. The United Nations had mostly a symbolic moral authority. The Bretton Woods institutions had the power to set rules and back them with economic sanctions.

Competing Empires

The very real threat of Soviet military power provided a democratic rationale for a buildup of military power by the United States, the provision of military assistance to trusted allies, and the positioning of military bases around the world. The expressed purpose was to counter the Soviet threat and protect the free nations of the world from assimilation into the Soviet Empire.

However, U.S. military power was rarely, if ever, used in support of democratic governments and movements, which by their nature threatened U.S. imperial interests. To the contrary, when the U.S. military intervened abroad it was usually to put down popular liberation movements that sought the right to democratic self-determination, and to install or protect dictators friendly to U.S. interests. The dictators favored by both Republican and Democratic U.S. administrations following World War II included Pinochet in Chile, Somoza in Nicaragua, Marcos in the Philippines, Suharto in Indonesia, the shah of Iran, the Saudi royal family in Saudi Arabia, and (until the Gulf War in 1991) Saddam Hussein in Iraq.

As U.S. economic and military power grew in the postwar years, the imperial agenda became more expansive. Earlier the focus was on access to land and natural resources. The new agenda included the domination of markets, culture, finance, and technology.

The New Colonialism

The end of World War II began a process of phasing out traditional colonialism based on military occupation. The United States pioneered the use of foreign aid, investment, and trade to dominate the cultures, economies, and governments of client states through less overtly violent means—but with the threat of military intervention always in the background. Initial implementation of the strategy relied on global corporations, the IMF, and the World Bank. Subsequently, regional trade agreements and the WTO became favored instruments. All 197the while, the United States used its military power to support regimes that were friendly to imperial U.S. interests and to bring down those that were not.³⁴

In the post–World War II period the United States provided over $200 billion in military assistance to some eighty countries to train, equip, and subsidize more than 2.3 million troops and internal security forces. Just as President Washington had used federal troops to put down the Whiskey Rebellion, so the primary responsibility of these security forces was to protect elite interests, including those of U.S. corporations, from domestic disturbances.

Recipients of military aid included notoriously repressive military regimes in “Turkey, Zaire, Chad, Pakistan, Morocco, Indonesia, Honduras, Peru, Colombia, El Salvador, Haiti, Cuba (under Batista), Nicaragua (under Somoza), Iran (under the Shah), the Philippines (under Marcos), and Portugal (under Salazar).” In addition, the United States funded and aided the military overthrow of “democratically elected reformist governments in Guatemala, Guyana, the Dominican Republic, Brazil, Chile, Uruguay, Syria, Indonesia (under Sukarno), Greece, Argentina, Bolivia, and Haiti.” It “participated in covert actions or proxy mercenary wars against revolutionary governments in Cuba, Angola, Mozambique, Ethiopia, Portugal, Nicaragua, Cambodia, East Timor, and Western Sahara.” And it took hostile action “against reformist governments in Egypt, Lebanon, Peru, Iran, Syria, Zaire, Jamaica, South Yemen, and the Fiji Islands.”³⁵ Just since 1961 the United States has been involved in overt military engagements in Vietnam (1961–73), Lebanon (1982–84), Grenada (1983), Libya (1986), Panama (1989), Kuwait/Iraq (1990–91), Somalia (1992–93), Haiti (1994), Bosnia (1995), Kosovo (1999), Afghanistan (2001–), and Iraq (2003–).³⁶

Contrary to the assessments of many historically challenged commentators, the 2003 preemptive first-strike U.S. invasion of Iraq was far from the first time the United States had launched a unilateral preemptive first-strike invasion of another country. The United States has a long history of launching unilateral first-strike attacks against small nations of inferior military power for questionable ends. Some of these wars were minor skirmishes. Others, like the occupation of the Philippines and the current war in Iraq, were full-scale invasions costly in lives and treasure. Many were in support of brutal dictators. Rarely did they advance a democratic cause. 198

The Debt Weapon of Mass Destruction

As noted in previous chapters, debt has long been a favored instrument by which the privileged use their control over access to money to appropriate the resources of the gullible and the desperate. During the period of its post–World War II expansion the United States pioneered the transformation of debt-funded development assistance into a weapon of mass destruction to seduce corrupt rulers, generate profits for U.S. corporations, and leave the “assisted” countries in the iron grip of international creditors. It is an extraordinary tale spelled out in Confessions of an Economic Hit Man, by John Perkins, whose job as chief economist for a major international economic consulting firm was to generate and defend grossly inflated economic projections to justify supersized infrastructure projects financed with loans from the World Bank and other foreign creditors that the borrowers could never repay.³⁷

Intentionally making uncollectable loans to foreign governments may seem the work of fools, but the money flowed directly to the bottom lines of well-connected U.S. construction and energy companies like Bechtel and Halliburton, which built the infrastructure. The perpetual indebtedness of those nations gave global financial institutions a stranglehold over their economic and political resources. The overpriced infrastructure in turn subsidized the operations of transnational mining corporations, agricultural estates, and offshore production facilities. These loans and contracts created opportunities for lucrative payoffs to corrupt dictators who served U.S. interests, and they aligned the recipient nations with the United States on crucial UN votes. The ruling classes of the debtor nations, who benefited financially and politically, rarely objected; the people who suffered the consequences — including future generations—had no voice. The human and environmental costs have been unconscionable.

Most of those involved believed the ideological rhetoric they used to justify it all as a holy mission. Others, like Perkins, who were trained and rewarded to manufacture and defend the lies that turned these programs into weapons of mass destruction, knew exactly the true nature and purpose of their work, as the Perkins account makes clear.

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The U.S. Constitution initiated the first major modern experiment in replacing hereditary monarchs with elected leaders, and it secured freedom of worship and thought through the separation of church and state. These achievements represented a seminal contribution to bending the arc of history in the direction of democracy and Earth Community. The idea that the architects of the U.S. Constitution created a government that secured for ordinary people the democratic ideals of popular sovereignty is, however, little more than a highly successful triumph of public relations image building over reality.

Once independence was won, the colonial elites who inserted themselves to take control of what had been a self-organized rebellion turned their attention to securing their hold on the institutions of government. The human rights that had been carefully delineated in the earlier Declaration of Colonial Rights, and the principle that all men are born equal and enjoy a natural right to life, liberty, and the pursuit of happiness so elegantly articulated in the Declaration of Independence, fell by the wayside. The focus shifted to securing the interests of industrialists, bankers, and slave-owning plantation owners and assuring that the powers of government would remain in the hands of white men of means. Empire morphed once again into a new form but remained true to the essential organizing principle of domination. What the founders brought forth is best described as a constitutional plutocracy with an agenda of imperial expansion.

Most every American will readily acknowledge that the United States is a superpower. To acknowledge that we are an imperial power feels less comfortable, as it contradicts our national self-concept as a democratic nation and a global beacon of freedom. The facts of our history, however, make it painfully clear that imperial expansion to dominate other peoples and appropriate their resources has been integral to our nation’s domestic and foreign policy throughout our history. It is the classic imperial solution to the problem of domestic tensions resulting from the injustice of an extreme division of society between people who own and people who work.

Our forebears who settled the narrow bit of land along the east coast of North America took the land by force and deceit from its indigenous inhabitants. They imported slaves forcibly abducted from Africa to work the land. When they found that land insufficient to their needs, they embarked on an imperial westward expansion to appropriate by force all of the Native and Mexican lands between themselves and the 200far distant Pacific Ocean, displacing or killing the original inhabitants as they went.

Reaching out beyond our own borders, we converted cooperative dictatorships into client states by giving their ruling classes a choice of aligning themselves with our economic and political interests and sharing in the booty or being eliminated by military force. Following World War II, when the classic forms of colonial rule became unacceptable, we turned to international debt as our favored instrument for imperial control and later to trade agreements that opened foreign economies to direct ownership and control by transnational corporations.

As our history makes clear, democracy is not a gift granted by benevolent power holders. Those to whom it has been denied achieve it only through organization and sustained struggle.