Lines

Think of this as Volume 18, Number 10 of the newsletter I have written weekly since March, 1997. Enjoy.

When historians ask how it was that a handful of people were able to control so much of the world during the early 21^st century, the answer will be one word.

Lines.

Countries are defined by lines. States are, counties and cities are. Jurisdiction does not extend outside the lines. The only way through lines is through negotiation, and anyone can defy the common law by simply saying no and hiding behind their lines.

What the ultra-wealthy have done is use their ability to move among lines and between lines, playing states, cities, and nations off one another. They have done much of this under corporate cover, so even if they get caught they themselves aren't hurt – if corporations are people they're other people, the employees and minority owners.

I've covered a number of line stories lately. The move of the Atlanta Braves to Cobb County, at a cost to schoolchildren of about $500 billion, was possible only because John Malone's Liberty Media was able to manipulate the racism of Cobb County, its hatred of the black-run City of Atlanta, crossing a line to get what he wanted. Arthur Blank did the same the other way, getting a similar amount of tax support to build a new stadium for his Atlanta Falcons and an unnamed soccer franchise. 

Similar manipulation happens between states, and the wealthy few always benefit at the expense of the many. Georgia Governor Sonny Perdue bragged some years ago of luring Kia Motors to West Point, Georgia, with $672 million of taxpayers' money. Phenix City, Alabama, across the state line, wound up getting most of the plant's suppliers, without having to spend a dime. Kia would have gone to either place, but it played them off between one another and came out the winner, at taxpayer expense.

The same thing happens between countries.

I wrote recently about two deals where companies supposedly based in Ireland bought U.S. based drug companies. But the buyers weren't really Irish, any more than Mitt Romney is a native of the Cayman Islands. One of the Irish companies had been founded in the 1860s, in St. Louis, by German immigrants. The other was actually based in New Jersey, their Irish office not much bigger than a postal box.

Why? Ireland's tax rate on corporate profits is 12.5%, much lower than anywhere else in North America or Europe. Moreover, it lets patent and copyright holders move their 'property' freely between Ireland and tax-free jurisidications like Bermuda, so no one even pays the 12.5%. By crossing some artificial lines, corporations gain huge benefits without putting anything at risk.

Everyone wants to be Singapore, or Hong Kong, or Dubai, and they think that tax giveaways are the way to get there. But theses early movers required the rich to actually invest in exchange for the largesse. They're rich places because people work there, not because rich people park money there.

In an age where money can move at the touch of a button, tax havens steal from the world's masses to benefit only a handful of people. The handful use their mobility – their ability to cross lines – to beggar the rest of us.

Should any country, like France, protest the rule of the rich and increase taxes, the rich simply move, leaving a few less-mobile to suffer the consequences, and leaving the state poorer than before. The rich insist that wealth will eventually “trickle down” but, as Pope Francis has noted, it never does. The promise that the glass would overflow was false – the glass just gets bigger.

In this way, a relative handful of people with no long-term stake in the future of the planet – most are over 50 – are able to rule over 7 billion people, to despoil the Earth at will, to beggar the rest of the people on the planet, and to live in a way that to the rest of us seems unfathomable.

What few of today's observers understand is that, economically speaking, this is a bubble like any other. Just like the Internet bubble, and the housing bubble, the Wealth Bubble contains within it the seeds of its own destruction.

Because power can erase lines.

The Internet can help The Internet is, by its nature, global. The Internet resists every attempt to censor and regulate it. It routes around censorship. More important, people who live with a censored net get less value from the resource than those who live with an uncensored net. Internet wealth – not just financial but intellectual wealth – will always flow toward freedom and away from censorship.

The more powerful the computers we attach to the Internet, and the greater their capability for manipulating data, the more power is available for people to connect with one another, crossing lines and building alliances.

And that's what it takes to stop the rape of the planet by the oligarchs. We have to recognize, all of us, that these lines are artificial, and agree across those lines to stop letting the few get away with so much at the expense of the many.

The tools with which to create change are in peoples' hands. Our real enemy is the idea that change is impossible. The idea that change is impossible is the greatest ally the ultra-wealthy have. Cynicism is their friend. Apathy is their friend. Snark can be their friend.

Change of any type starts with a belief that change is possible. We are witnessing multiple revolutions right now, which may not succeed, but speak to the fact that people in far worse straits than ours haven't given up on the possibility of change.

We have the tools at hand to support this change, and bring it to our own country. All that's lacking is the will. My will. And your will.

Cross a line. Erase it.