Saturday, July 30, 2011

The US is a Plutonomy: Here Comes Neo-Feudalism

Plutonomy Defined: a society characterized by a small, wealthy elite and a large, disenfranchized group with marginal economic power.

The first use of the term “plutonomy” to describe the evolving economic distribution was, I believe, a 2005 Citigroup document dated October 16, 2005 titled, “Equity Strategy: Plutonomy: Buying Luxury, Explaining Global Imbalances.” The document describes a world “dividing into two blocs—the plutonomies, where economic growth is powered by and largely consumed by the wealthy few, and the rest” (p. 1). The U.S. is a “key” plutonomy characterized by

"disruptive technology-driven productivity gains, creative financial innovation, capitalist-friendly cooperative governments, an international dimension of immigrants and overseas conquests invigorating wealth creation, the rule of law, and patenting inventions." (Citigroup, 2005, pp. 1-2)

Within the plutonomy, the productive and consumptive capabilities of populaces lessen in significance compared to the wealth accumulated by the few through technology that replaces workers, financial “innovations” capable of accumulating wealth outside of production (e.g., through securities transactions), and through overseas colonial exploitation of resources and labor.

The International Forum on Globalization (IFG) issued a report in 2011 describing the evolving “plutonomy” characterized by corporate power and the unfettered influence of “a new dangerous class of politically dominant billionaires”:

Plutonomy: A newer threat cited for the first time by the board was the astonishing emergence of a new dangerous class of politically dominant billionaires. Operating on a global scale, as well as within countries, these oligarchs are increasingly able to relate to the world nearly as if it was their own feudal enterprise, generally out of view, and with few controls. Recognizing the realities of resources limits, many of these individuals now see their profit opportunities as no longer solely dependent on corporate economic growth, but equally on systemic control of vital resources, including food and water." (IFG, 2001)

In a world of dwindling resources, the elites seek to control not just money but also fertile land and fresh water.

Plutonomies are funtamentally antithetical to democratic political processes. Plutonomies are birthing a new system of global neo-feudalism where elite corporations and individuals control the vast majority of global resources and the rest of us will be forced to pledge our allegiance, and give up our liberal rights, to these new feudal lords or be left with nothing at all....

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