BUSHZOMBIE

If you have ever played the game Monopoly, then you understand today’s American economic landscape and what is going to happen in the next few rolls of the dice.

If you haven’t played Monopoly, or it’s been a long time and you forgot, here’s the idea: “Own” every property on the board so each time a player lands on a square, they owe money to YOU.

The best strategy is to start purchasing everything immediately when the game starts. With a roll of dice and single mindedness you will win – unless someone else understands the strategy. In that case, you will need more luck. In terms of skill – single mindedness will do. Once you own everything, you win; game over.

American business since Regan/Bush/Clinton/Bush deregulation is now very much like the game of Monopoly. The 80’s unleashed economic Darwinism on the American economy and now, we’re in a game of Monopoly for real. The big difference between the Monopoly game and the real game is simply a matter of game time (although I’ve heard that there is a Monopoly game with eight players that has been in process since 1968).

In the real world, businesses focus on obtaining market share (properties) through a roll of the dice and single mindedness. This is not necessarily a bad thing. We certainly want American businesses to compete for our dollars, create jobs, make things, and produce goods and services; to add value for the American consumer, right? The difference between the game and real life is as follows: Companies in the real world make money by winning customers and Monopoly players make money by purchasing properties and waiting for people to pay them.

Something happened in the 80’s that changed the way the real world game was played. Corporations found a far more profitable way to harness American prosperity (equity and savings) of the 50’s, 60’s and 70’s. With deregulation came leveraged buyouts and business consolidation. This was unleashed by conservative deregulation. America was sick of stagflation. She needed to kick off her shoes and the way to do it was with a Ronald Regan credit card. You might have heard it called Supply Side economics, trickle down economics or possibly Voodoo Economics. It can be thought of as a blend of government tax policy favoring the rich and deregulation. It was as if America sat down and opened up a board game. We began playing with the equity that America had built over 30 years.

Consolidation of American firms by multinationals has been expanded in recent years. The number of squares on the board is now global and that’s where the problem starts. With no regulation to prevent American assets from being sold off, our country is now up for sale. The elitism of American conservative economics has led to the enrichment of the few at the expense of the many. And now, the game is at the very end. Most of America has mortgaged all they have and the “winners” are finding fewer and fewer people with enough money to continue the game. Americans are finding that the pile of money in front of them is evaporating and Baltic Avenue is not worth today what it was last week, and certainly not enough to keep up with the owner of Board Walk and Park Place.

Multi national conglomerates and foreign countries have almost managed to achieve their ultimate goal: Own everything in America — a place where politicians allowed their country to be sold.

Oh no! Just when you thought the game was over in comes the Federal Reserve to drop money on the bankrupt players.

And just like the game, the money will last for a roll of the dice. A few players will get lucky and land on “Chance”. A few will get very lucky and might get two rolls. But remaining players should not take solace in their new found fortune from the Federal Reserve; make no mistake, there are only a few rolls left.

Most Americans are the eternal optimists. They cannot see the forest Monopoly board for the trees, or in this case Shoe/Hat/Horse. They live in a little world where reality is paycheck to paycheck. Like good little Monopoly players, they spent their money as they were told and borrowed money from the Chinese to buy I-Pods and borrowed money from the Saudis for gasoline, then mortgaged their home to keep the economy afloat as Greenspan and George Bush requested. What Americans forgot was that some day the bill would come due. Every square would have hotels. Anyone who has played Monopoly knows what happens next. No more I-Pods, no more gasoline, no more home, no more cash.

There are many players who have a pile of dollars before them, laughing because they can afford to pay the hotel bill. But if their wealth is based on paper and not property, their good fortune or frugal nature will soon be worthless as well. The game is merciless. They too will toss the dice and land on hotel after hotel property and they will fall to the property owners. This is Monopoly after all.

The following is a graph from EPI.ORG, displaying wage inequity. The player, called the Top 1% (Mr. Top Hat) on the far right, seems to have acquired everything and is on the verge of winning the game. Mr. Top Hat has generated his cash from tax cuts and those cuts came from borrowing.

The tax cuts could not come from the middle and lower class as they simply don’t have the money.

 

From Columbia University compiled data and can be reviewed here: http://www.columbia.edu/~wk2110/uncovering/.

But is Mr. Top Hat really winning? He has immediate wealth called income. The wealth is generated from borrowing and the loans are being held by foreign interest. So Mr. Top Hat might indeed look like a winner now. But as everyone knows, real power is owning assets, because assets generate wealth. The key word is: Generate wealth. This is true for the Monopoly world and it is just as true for the real world. Assets generate profits and profits flow to the owners. In this case, the owners will be foreign governments and multi national conglomerates — the people who loaned America the money.

Note that foreign interests now own 13.6 trillion in U.S. assets in 2005. This is greater than the entire GDP.

Why can’t American’s invest in America? Why are foreign countries and multi nationals investing? As the chart below shows, American’s have no money left to invest after they pay their bills.

 

What is the answer?

According to the Federal Reserve’s actions, the solution is dropping money on the bankrupt players and squeezing a few basis points left on the interest rate scale. But this will do nothing to resolve the true problem, which is inequity of America’s resources which has led to the sell off of America to foreign interest.

The game Monopoly is not just a game, it is a simulation. It was created based on reality. Here is a short description from Wikipedia:

 

In 1903, the Georgist Lizzie Magie applied for a patent on a game called The Landlord’s Game with the object of showing that rents enriched property owners and impoverished tenants. She knew that some people would find it hard to understand the logic behind the idea, and she thought that if the rent problem and the Georgist solution to it were put into the concrete form of a game, it might be easier to demonstrate.
^{http://en.wikipedia.org/wiki/History_of_the_board_game_Monopoly}

So maybe we can use Lizzie’s example. The game might help Americans understand what is happening to them.

Just like the Monopoly game, in the real world when a single player has all the properties, everyone else loses no matter how much cash the players have. Since the rules were changed in the 80’s, the real world strategy in American business is no longer creating a thriving, productive business that delivers equity to the American public. The strategy in today’s world is greed, moving paper, merging into super conglomerates, raking in short term leveraged profits. America’s infrastructure is left unmaintained and the cost to run America’s government is borrowed. The rich are not taxed. The conservatives have sold America the idea that taxing the wealthy will hurt job growth as they outsource jobs from America. The debt to run our nation is pushed to foreigners. Saudi Arabia and China understand how the game is played. They realize property is king. Cash is used to purchase property. Wittingly or not, America has allowed her assets to be sold for paper, she has mortgaged her future wealth for short term profits.

Only a few players actually hold the properties.

Now that we’re at the end of the game and most Americans have lost to the admittedly better players, China, Saudi Arabia and multi national investors like the Carlyle Group, isn’t it time to fix the game? Won’t the winners get tired of watching an empty board full of hotels and the players long gone, fat and enriched, with unending wealth, while America rots – her economic strength drowned in a sea of greed.

It is up to the American people to fix the problem. The asset holders will keep everything.

It is the nature of the game Monopoly.