Posted by: David Offutt | November 22, 2019

Plutocracy v. Republic: the Constitutions of Chile and the USA

Charles Koch and James McGill Buchanan: Koch wants a plutocratic constitution for the USA, and Buchanan wrote one for Chile in 1980. (Illustration by Natalie Matthews-Ramo; Photos by MBisanz/Wikimedia, Dechateau/Wikimedia,Atlas Network/Wikimedia and Thinkstock)

The protests that began in Chile in October have been calmed by a two-page compact called an “Agreement for Social Peace and a New Constitution.” In April 2020 a referendum will be on a ballot to ask the voters if they want the Constitution of 1980 to be replaced. The billionaire president of Chile, Sebastian Pinera, consented to this, and he certainly runs the risk of being accused by his fellow plutocrats – the super rich – of being a traitor to his class. He may be not just in political danger but also in physical danger as a result.

Chile, like the United States, is a very prosperous country with a huge gap between the haves and the have-nots.  You may recall that President George W. Bush admitted his supporting base to be “the haves and have-mores.” In the U.S. today, three men – with the last names of Bezos, Gates, and Buffett – have more wealth than half our population combined, the 165 million Americans with the lowest incomes. Income inequality is worse here than any other developed country in the world, but Chile isn’t far behind.

Jeff Bezos, Bill Gates, and Warren Buffett: These three were major beneficiaries of the Trump-Ryan-McConnell GOP tax cut for the rich in 2017. Buffett is at least embarrassed that his tax rate is lower than all Amercan taxpayers who are not in the upper 1%, but he didn’t turn down his tax cut. (Photo by Access 24)

Even though the protests began because of an increase in the subway rates in Santiago, the nation’s capital, reducing the fares won’t solve the problem.  The problem is the constitution that was written after Augusto Pinochet’s dictatorship came to power in the early 1970s. It was a masterpiece of the plutocracy establishing a government “of the people, by the rich, and for the rich,” designed mostly by James McGill Buchanan, an American economist.

Buchanan brilliantly set it up so that whenever Chile’s dictatorship ended and the nation returned to a republican form of government, the government would still not be able to do anything to improve the lives of the vast majority of its people. It created a plutocratic paradise: unions were banned; education, social security, and health care were privatized; majority will could be suppressed; free market capitalism could not be regulated for the public good; a balanced budget was required to prevent taxation of the rich; a supermajority was required for any change in the laws, and more.

James McGill Buchanan, Jr.: He’s the American economist most responsible for the rejection of Keynesian economics now endorsed by great wealth and made popular by Ronald Reagan. Did you ever wonder why Obama’s stimulus bill was so meager that it didn’t produce a long-lasting robust economy that benefited the middle class instead of the gradually improving one we have? (Photo from the Nobel Foundation Archive)

Buchanan’s 1980 final document, the ‘Constitution for Liberty,” guaranteed economic liberty for the few with vast wealth and a permanent restraint on the people to prevent majority rule for generations to come. When the Chilean republic was restored in 1990, 40 amendments were added to attempt to make their constitution compatible to the needs of the people – and 40 weren’t enough. Buchanan had embedded Plutocratic rule into the constitution so well that over the past 30 years the equality gap has continued to widen.

It should be no surprise that Buchanan became the economic and ideological hero of the billionaire Koch brothers (Charles and the late David) and their donor network of hundreds of other millionaires and billionaires. Buchanan showed them the type of economic professors they wanted in all our colleges and universities. They began contributing money to higher education with the understanding that they approved the economists that were hired to teach. More importantly, with his Chilean constitution he provided them with a perfect road map on how to change our fragile American republic into an official American plutocracy.

After David Koch lost his race for vice president on the Libertarian ticket in 1980, the Koch brothers decided to essentially acquire ownership of the Republican Party and use it as their vehicle to establish permanent plutocratic rule. From Ronald Reagan’s election to today, that’s basically where we’ve been heading with an ever-expanding income equality gap. The Supreme Court’s malicious 2010 Citizen’s United 5 to 4 ruling declared that money was free speech and opened the flood gates into purchasing the American government.

Presidents Barack Obama and Bill Clinton: If Bill’s hands were wider apart, he might be discussing the income inequality gap that he and Obama contributed to. (Photo from the AP)

The two “Democrats” since 1980, Bill Clinton and Barack Obama, were hated passionately by the Republicans because neither one’s origins indicated they were worthy of being president, both raised taxes on the rich, both took steps to protect the environment, and both addressed health care needs in some way. Regardless, neither Clinton nor Obama changed the neo-liberal economic policies that exploded the income-inequality gap. Obama’s response to the Great Recession was enough to prevent another Great Depression but wasn’t enough to reverse course and even expanded income inequality. Thus, with all this in mind, I consider Clinton and Obama to be the best of the “Republican” presidents in the past 50 years – at least they did some good things and neither conspired to subvert the constitution.

The Koch donor network has used the Republican Party to get control of the federal government (executive, legislative, and judicial branches) and of the state governments as well. If they can get the governorships and complete control of state legislatures in 37 states, they can constitutionally create a “Convention of the States” to alter the U.S. Constitution.

Charles Koch: He and his late brother David founded multiple think tanks like the Cato Institute to achieve methods to get Americans to vote against their own best interests in favor of what is best for the “job makers” instead of the “moochers.” Their donor network of others of vast wealth meets secretly periodically to plot their strategies. They endorse candidates on the national and state levels to advance the ideas of J.M. Buchanan and Ayn Rand. (Photo by Nikki Khan/ The Washington Post via Getty Images)

I shouldn’t have to tell you that the representatives that they send to that convention will not be of the caliber of those who attended the Constitutional Convention of 1787. I still contend that the delegation that was sent to Philadelphia in ’87 was the greatest assemblage of great minds for a single purpose in history, and even they did not create a perfect document. However, the United States Constitution was designed so that it could evolve with the times and allow the government to respond to extraordinary needs. Changes can be excruciating slow, but they can occur if – and only if – the moral and political will exists. These are factors that will no doubt be eliminated in the plutocracy-friendly amendments or new constitution as proposed by the Koch donor network in their “Convention of the States”.

So far, 15 states support a convention, 7 states have one half of their legislatures approving, and 15 other states have proposals before them.  The primary goals are to prevent majority rule and protect the sovereignty of great wealth.

[A version of this essay was printed in the El Dorado News-Times on November 20, 2019.]


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