We are in a world-wide war between the plutocrats and the networked people

Why are we seeing people's demonstrations taking on plutocratic governments from Tunisia to Madison, Wisconsin? Jon Taplin offers his explanation. It is quite compelling.

On October 14, 2008 I gave a speech at USC called "America 3.0 and The Interregnum". In it I argued that we were entering a global phase of extreme turbulence in which the bottom-up forces of a networked world battled the top-down hierarchies of centralized power. As the Italian philosopher Gramsci had noted,"The old is dying and the new cannot be born. In this interregnum there arises a great diversity of morbid symptoms." Although this upheaval was accelerated by the global financial crisis that I had been warning of since December of 2007, it was not caused by the crisis. It was rather a symptom of a technological revolution initiated with U.S. Defense department funding as early as 1958. We came to call this the Internet.

I am not a techno-utopian who believes that the mere existence of a globally networked culture will allow "the new to be born". In fact, as John Palfrey points out, dying regimes will do their best to use Internet surveillance to hold on to power.

The leaders of many states, like China, Vietnam, and Uzbekistan, have proven able to use the Internet to restrict online discussion and to put people into jail for what they do using the network. We should resist the urge to cheer the triumph of pro-Western democracy fueled by widespread Internet access and usage. The contest for control of the Internet is only just beginning.


What I do believe is that the sources of leadership innovation and change in the next decade will be the bottom-up networked culture, rather than centralized hierarchies dictating how people should organize their polities. This is why the events in Wisconsin are as important as the events in Tripoli. As the historian Joseph Ellis wrote, "The main story line of American History, cast Thomas Jefferson and Alexander Hamilton in the lead roles of a dramatic contest between the forces of Democracy and the forces of Aristocracy (plutocracy)." The Punk'd phone call between Governor Scott Walker and what he perceived to be his aristocratic patron, David Koch, revealed the truth of Ellis's maxim. Like Hamilton, who he so admires, Koch is only interested in restoring the primacy of the plutocracy. His assault on the forces of democracy has three phases. First, by funding the Citizens United court case successfully, he freed the forces of the plutocracy to completely dominate political speech. Second, as Paymaster to governors like Scott Walker and John Kasich he is directly attacking the rights of workers to form unions and collectively bargain. By breaking the unions he eliminates the one institutional source of political money that might counter the plutocrats lock on campaign finance.

The final phase of Koch's plutocratic assault on democracy will come in the years to follow if he is successful in Wisconsin. We will return to an age of radical deregulation.

The plutocrats are primarily the people with great amounts of money together with their hirelings in government and in large corporations. As the Wall Street Banks (who make their money both by investing the funds of the plutocrats and by exploiting the people who are not wealthy and who do not understand financial exploitation methods like usury) know very well, they get their money by making financial deals, not by creating jobs that make life better for average workers. David Koch is one of many, and almost all of them in America are working to attack the American middle class and destroy it.

The Great Recession is the direct result of their efforts to free banks from government regulation so that banks would be free to create money without any limitation. (This is where the money supply comes from, not from the government.) The financial collapse is the direct result of that freeing up of banks and the growth of the shadow banking system outside of all regulation. Banks cannot be allowed to operate except under tight regulation and great transparency if we want a stable economy. Similarly, the plutocrats cannot be allowed to free themselves from taxation to support the government because it is the existence of government that creates their wealth and protects their privilege of using that wealth.

Madison Wisconsin is America's entry into the battle of the middle class around the world to take and keep control of their world.