Social programs. Money laundered through the Great Unwashed

America needs poverty. Poverty eradication proposals are head fakes. America, especially the America that was created right after the Civil War, would not be where it is today without poor people.

Since the industrial revolution, and definitely as America entered the information age in the 1960s, the products designed and built by highly educated, highly paid labor had to be consumed by a large mass of “dependents.” These people are typically wage earners who do not have the capability to be self-sufficient and hold little to no capital. The greater the mass of consumers, the larger the network used to deliver goods. The larger the network to deliver goods means the higher educated, higher paid laborer and entrepreneur faced lower costs for delivering goods.

Emancipation, reconstruction, and the Jim Crow era coincided with the growth of consumerism. The American political economy, not knowing what to do with freed slaves was willing, in lieu of distributing productive capital to them, to turn them into a mass of consumers, with a willing cadre of banks and bond holders willing to launder money through “social welfare” programs.

The food stamp program? An opportunity for bond holders to launder money by financing a program whose clearinghouses are administered by banks.

Affordable housing programs? An opportunity for bond holders to finance the construction of low cost homes with principal and interest guaranteed by taxpayers, many of whom are not in the upper ten percent.

Medicaid and Medicare? Again, bond holders are offered a guarantee that taxpayers will provide a backstop for premium payments while insurance companies collect fees for administering them i.e. WellStar and Medicaid in Georgia.

There is a reason why the poor are referred to as the Great Unwashed. It is because dirty money is laundered through their misery.

One thought on “Social programs. Money laundered through the Great Unwashed

  1. This post is pretty cynical, and seems to assume that only freed slaves and their offspring are the beneficiaries of things like food stamps, affordable housing programs, Medicare and Medicaid, when in fact many “white” people use these programs as well, and not all of them are necessarily poor.

    A case in point: after World War II, the GI Bill was enacted to provide various benefits for members of the US military returning home from the war. There were benefits to help pay for higher education, and benefits that created home loans at reasonable rates that allowed many young families to buy small but affordable single family homes.

    The result was an educated work force that enabled the US to create all kinds of products and services to be sold at home and abroad, and single family home ownership for many.

    Clearly, banks, mortgage lenders, title companies, real estate agents, and housing insurance companies made money off of the housing, and I tend to agree that they made too much, jacking up home prices to where “affordable housing” is very difficult to find for many nowadays, but some good did come out of all this—many families did not have to live in two family and four family flats full of bugs and rats, and had reasonably nice neighborhoods in which to live.

    Do I think capitalists have excessively exploited not only the poor, but also the middle class? Of course I do, but at the same time some good came out of that. To paraphrase Mark Twain, out of every decision (and action) there are good effects and bad effects. That’s just reality

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