Former Obama undersecretary of state Rick Stengel is freaking out over news that the Trump administration has taken a 10 percent equity stake in chip-manufacturer Intel:
Trump’s strong-arming Intel for gov’t equity is something Mao and Stalin would be proud of. . . . Once, the GOP believed in laissez-faire capitalism and government not interfering in the private sector. Look it up: the state owning the means of production is called Marxism.
Anyone old enough to remember the phrase “Government Motors” should be able to appreciate what a wild line of criticism this is to hear from a former Obama official. As part of his Troubled Asset Relief Program, Barack Obama took for the US government a 61 percent equity stake in General Motors — and the Right’s backlash was entirely predictable. Rush Limbaugh called this “a sterling example of the Left’s crusade for government control of business” that proved “the Left’s enchantment with socialism.” John Stossel complained that this was a “move towards more government control of the economy. . . . And, in the end, that’s pretty close to socialism.”
That so many liberals have adopted this line of criticism — Joe Scarborough took it up on Thursday and Democratic consultant Jessica Tarlov ran with it on Friday, for example — should probably provoke some reflection among socialists who think of liberals as fellow travelers. While socialists may share certain egalitarian values and other priorities with contemporary Democrats, American liberals are still reflexively ambivalent-to-hostile toward the basic socialist agenda of nationalization. They will opportunistically support it when it is time for Democrats to bail out the economy, but then they will aggressively attack it if they think this will score points against Republicans. There are few things that contemporary liberals enjoy more than “catching” a Republican doing something that they can, rightly or wrongly, construe as socialist.
In this case, I would say wrongly. Stengel’s definition of Marxism as “state ownership of the means of production” is confused for all kinds of reasons, but here the most salient is that ownership does not imply control. Even if this was ordinary equity, 10 percent would hardly give the government any kind of significant control over the company. But as Intel made clear in a statement, this deal doesn’t even give the government 10 percent control:
The government’s investment in Intel will be a passive ownership, with no Board representation or other governance or information rights. The government also agrees to vote with the Company’s Board of Directors on matters requiring shareholder approval, with limited exceptions.
This notion of “passive ownership” perfectly illustrates why socialists would do well to talk about control rather than ownership of the means of production. A major function of modern finance is to sever the relationship between the two. To identify control, you have to look past the legal / business terminology and figure out who actually has the final say over any given lot of capital.
In that light, it isn’t clear that a 10 percent ownership stake even represents incremental progress toward control of Intel. Convincing a business to give you a 10 percent nonvoting stake in their company is a very different thing from getting a 10 percent voting stake, let alone a 51 percent voting stake.
Nevertheless, American partisans clearly aren’t interested in litigating the fine details between ownership and control — and that’s why socialists have an interest in this fight. If Democrats are going to try to vilify Donald Trump as a socialist, the best response is to complain that he isn’t even doing socialism.
Great Job Carl Beijer & the Team @ Jacobin Source link for sharing this story.
