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Blog: America’s Ruthless Oligarchy

 

The wringing of hands over the decline of American democracy is typical of a society that cries crocodile tears whenever corrupt oligarchs are threatened. But as their evil deeds are revealed and the misery the wealthy have imposed on everyone else reaches upwards, America exposes itself not as a flawed democracy but as a ruthless oligarchy.

 

Eugene Stovall

Oakland California February, 2021

 

“I’m as mad as hell and I’m not going to take it anymore!” Howard Beal [Peter Finch] murdered by an oligarchy’s minions in the 1976 film, Network

 

It is a myth that America’s democracy is in decline. America is not now, nor has it ever been a democracy. America is an oligarchy, run by the wealthy who use secret societies, religious institutions and the government to control the land and all its wealth. Propagandists, academics, ideologues and preachers of the gospel have long justified America’s oligarchy by bombarding the public with disinformation and creating enemies, foreign and domestic, against whom America’s oligarchs wage endless wars.

 

Immediately after the Revolutionary War, the Lords of Labor, Justice and Capital seized the legal authority to implement the draconian tax laws that wealthy merchants and their trading partners, English and European bankers, used to realize their war profits. To guarantee their control over the government, America’s founding oligarchs made property ownership a voting requirement and then confiscated the property of those who opposed their rule. The oligarchs solidified their power by instituting a 3/5th voting rule, excluding women from the electoral process, appointing wealthy aristocrats to the US Senate, selecting the president of the US through an electoral college, giving federal judges lifetime appointments, giving private, profit-seeking bankers total control over the economic and monetary system, sanctioning the African slave trade and using federal troops to eliminate native Americans.

 

The merchants and pro-slavery landowners who drafted America’s constitution knew they were creating an oligarchy. Operating in secret and under guard, the wealthy planned to force the lower classes back into peonage by confiscating their land, labor and possessions. So, while George Washington used slave labor to grow hemp, brew beer and distill liquor on his 8000-acre Mount Vernon plantation, the Washington hung revolutionary war veterans for refusing to pay the taxes levied on their alcohol and beer during the Whiskey Rebellion. Samuel Adams, the patriot who opposed English taxes on New England merchants, urged Congress to hang the veterans who resisted the confiscation of their property during Shays rebellion. From the very beginning, while the wealthy used the power of the government to suppress opposition to their rule. Then co-opting the mass media, academia, religious institutions and, above all, secret societies, the wealthy class created their democratic myth.

 

Robber Barons: The Men Who Stole America

 

In the History Channel’s euphemistically named series, The Men Who Built America, only John Pierpont Morgan actually looked like a ‘robber baron.’ In fact, Oscar Wilde could have depicted J.P. Morgan in his The Picture of Dorian Gray.

 

J.P. Morgan’s henchman, Theodore Vail, the man responsible for building Morgan’s telephone monopoly, did not appear to be an evil man; he was rather pleasant looking. Nevertheless, Vail and Morgan were well-matched in ruthlessness. In 1903, through a series of bond purchases, J. P. Morgan grabbed control of Alexander Graham Bell’s telephone company from a group of Boston bankers. Morgan re-installed Vail as the company’s president. The Boston bankers had fired Vail over his ruthlessness in expanding the Bell Telephone Company. But J.P. Morgan needed Vail to be ruthless in turning the Bell Company into a giant monopoly. Theodore Vail sent ruffians to every independent telephone company in the US, offering the owners $200 for their entire operation, land, buildings, switches and lines. When the independent telephone company’s invariably refused Vail’s offer, his ruffianBys and when that didn’t work, killed the local operators. By 1914, Vail was able to sit in his New York office and complete a telephone call connected exclusively through AT&T-owned facilities all the way to San Francisco. With AT&T, J. P. Morgan owned a monopoly over America’s telecommunications network.

 

J.P. Morgan also invested in Thomas Edison’s electrical power company. Morgan hired Edison to install electricity in his New York City home where the inventor conducted electrical experiments. But while Edison was developing electrical power using direct current [DC] technology, George Westinghouse was developing a cheaper and safer type of electrical power using alternating current [AC] technology. When Westinghouse won the lucrative Niagara Power contract for AC electricity, Morgan threatened Westinghouse with bankruptcy in order to acquire Westinghouse’s electrical company. J.P. Morgan renamed his newly acquired billion-dollar electric power monopoly, General Electric. Ironically, the future president of the United States, became the national spokesman for J.P. Morgan’s General Electric Company.

 Morgan acquired another monopoly when he bought Carnegie Steel and formed the U.S. Steel Company.

Andrew Carnegie sold his steel monopoly to Morgan after failing in his attempt to match the wealth of John D. Rockefeller by following Cornelius Vanderbilt’s famous dictum: “What do I care about the law? Ain’t I got the power?” When Carnegie steel was used to build over 100,000 steel skyscrapers all over America, Andrew Carnegie became one of the nation’s wealthiest. But Carnegie needed to increase his wealth dramatically if he was to compete with John D. Rockefeller who Carnegie blamed for the death of his mentor, Thomas Scott.

 

By negotiating favorable rates with the railroads to transport his oil, Rockefeller gained an immense advantage over other oil refiners. Rockefeller used this advantage to buy out other refineries. Soon he owned the entire kerosene oil market and was able to play the railroads against each other further reducing the costs of transporting oil from his oilfields to his refineries. So, the largest railroad operators in the country, Cornelius Vanderbilt and Thomas Scott, decided to form an alliance and block Rockefeller from transporting his oil over their rail lines. In response. Rockefeller built a 4,000-mile oil pipeline to transport his oil. Rockefeller’s oil pipeline crippled the railroad transportation industry which depended on oil transportation to remain profitable. Railroad stocks fell so drastically that 120 of the country’s 360 railroad companies went bankrupt. The collapse of the railroad stock rippled through the financial markets, causing a shutdown of the stock market and triggering a national depression.

 

Cornelius Vanderbilt died at the height of the depression, but Thomas Scott thought that he could compete with Rockefeller by investing in his own pipelines. But Scott had no oil to transport. Rockefeller refused to allow any of his oil to be transported through Scott’s pipelines. In 1870, Scott died penniless and Andrew Carnegie vowed to take revenge on John D. Rockefeller.

 

But Rockefeller was seven times wealthier than Carnegie. In order to catch up, Carnegie hired Henry Frick, a self-made, power hungry millionaire, to head Carnegie Steel. Frick had a reputation for profits out of his companies by reducing wages and increasing working hours. In two years, Frick doubled profits at Carnegie Steel. However, under Frick, worker injuries and deaths also doubled. When the workers revolted and closed Carnegie’s steel mill, Frick hired Pinkertons to break the worker’s strike. The Pinkertons killed nine striking steel workers and wounded scores of others. Even though Frick faked an assassination attempt on his life, in the face of public reaction, Carnegie fired his strong man and engaged in a public relations campaign to rehabilitate the Carnegie image. Even though Carnegie Steel continued to increase its profits by underpaying and overworking its employees, Carnegie could not match Rockefeller’s wealth. In the end, Carnegie gave up his vendetta and gave Morgan another monopoly.

 

The Depression of 1873: How Oligarchs Rule

 

From the Panic of 1797 to the economic collapse of 2008, America’s oligarchs history have orchestrated a succession of depressions and economic collapses. From the American revolution to the present day, the country has stumbled from one economic disaster to another while the oligarchs feast on the spoils. Since its inception, the US has suffered twenty economic depressions and recessions, some lasting  years and causing business failures, unemployment, hunger, homelessness, disease and the deaths of millions. The American people still suffer from the depression of 2008 while their relatives recall suffering through the Great Depression and Stock Market Crash of 1939. Depressions and recessions have become a permanent feature of the American way of life as a corrupt oligarchy masks its ongoing criminal enterprises in democratic myths. An examination of the Depression of 1893 gives an insight into the workings of America’s oligarchs.

 

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In the 1850s, Jay Cooke, a Wall Street banker and his brother, Henry David Cooke, the editor-owner of the Sandusky Register, pro-slavery Democrats, joined the newly formed Republican party to assist Salmon P. Chase win the Ohio’s gubernatorial election. After Lincoln won the 1860 election, the Cooke brothers used their influence to get Governor Chase appointed Lincoln’s Secretary of the Treasury. The Cooke brothers earned millions brokering Treasury’s war bonds to northern bankers.

 

After the civil war, the Treasury Department funded 33,000 miles of new railroad track, making railroads the largest employer in the US outside agriculture. Treasury Secretary Chase signed over 60 million acres of federal land to the Cooke brothers who used the inflated land values as collateral to sell stock in their company, Jay Cooke & Company. The Cooke brothers created the Northern Pacific Railroad by floating bonds and acquiring railroad construction project loans.

In 1873, the economic bubble that the Cooke brothers created burst when Cooke & Company failed to market bonds secured by their Northern Pacific Railway company. Cooke’s railroad was desperate for cash. Their railroad construction loans were delinquent, but cash for railroad construction was scarce. A decade of corruption and war profiteering had shrunk the money supply and sent interest rates, on available cash, soaring. When reports circulated in financial circles that Cooke & Company could not raise the capital required to complete its construction projects and pay its debts, the company’s credit plummeted. On September 13, 1873, Cooke and Company folded, sending a panic through the financial markets. The private investment houses stopped lending money and the banks refused to provide cash to businesses, and finally stock market values began tumbling. With the cash crunch and all the nation’s currency held in private hands, the entire US economic system descended into chaos as businesses, deprived of capital, closed and unemployment skyrocketed. Thousands of companies defaulted on billions in debt and the wages of those with jobs fell by 25%. For a decade following the Panic of 1873. the country's economic productivity fell by 24 percent, but the panic was a boon for the ‘robber barons’ who retained their wealth while the economy collapsed. Economists and academics describe such economic catastrophes in terms of market forces, currency fluctuations and economic readjustments. They never use accurate terms like corruption, fraud and greed.

 

Greed And The American Government

 

The depression of 1873 was so severe that the twenty years later, in 1893, the Department of the Treasury faced economic collapse. In its desperation, the government called upon J.P. Morgan for assistance. With the noblesse oblige of a master criminal, Morgan gave the treasury a $3 billion loan and added the US government to his other profit-making monopolies. 

 

In 1896, William Jennings Bryan ran for president of the United States, vowing to break the power of the robber barons. Alarmed by Bryan populist appeal, Andrew Carnegie, John D. Rockefeller and J.P. Morgan banded together and decided to put their own president in th White House. The oligarchs elected William McKinley, the 25th president of the United States. As president, McKinley became the steward the oligarch’s wealth and protector of their monopolies.

 

Blog: Blood On The Senate Floor

 

In 1854, Kansas Homesteaders Fought Vigilantes For Their Land And Their Lives. Southern Land Barons, Eastern Bankers And Secret Societies Killed Settlers To Enter Kansas Into The Union As A Slave State. When A US Senator Accused The Democrats Of Orchestrating The Murder Campaign, A Pro-Slavery Congressman Left Him Lying On The Floor Of The Senate In A Pool Of His Own Blood.

 

Eugene Stovall, Oakland, California

January, 2021

 

 

Northern Reconciliation To Slavery

 

By 1850. the trickle of Negro fugitives escaping the horrors of Southern slavery had turned into a flood. Negro fugitives saddled Northern cities with homelessness, poverty and crime. Members of the Anti-Slavery Society funded an underground railroad that rounded up fugitive slaves and transported them directly to refugee camps operated by the Quakers in Canada. The American Colonization Society rounded up Negroes, fugitive and free, and transported them to America’s Liberian colony on the west coast of Africa. However, the emigration of Negroes to Canada and Liberia did not meet the needs of the majority of white people who wanted the Negro problem settled once and for all.

 

In 1850, Congress passed a law that reconciled the North to the South’s peculiar institution of slavery. Known as the Fugitive Slave Act, the law required the federal government to catch and return all fugitive slaves to the South. The slave law established slave courts where citizens were required to report the presence of fugitive slaves and assist in their capture.

 

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