Cartel Capitalism and the Deep State
An excerpt from my forthcoming book "The Coming World Nation"
This is an excerpt from my new book The Coming World Nation, which is now available on Amazon! It’s taken from Chapter 3, which is called “The Industrial Age and the Politics of Energy”.
Given the critical role that oil would come to play in 20th-century geopolitics, it is unsurprising that the Rockefeller dynasty, the founders of the Standard Oil cartel, would rise as perhaps the single most powerful faction within America’s capitalist ruling class. Leveraging their immense power and wealth, this dynastic family would exert an outsized influence on the future trajectory of American society, dominating its economy, bribing its politicians, influencing its culture, shaping its foreign policy strategies, and driving buildout of its military-industrial complex.
Delving into the origin story of the Rockefellers’s corporate empire, Timothy Mitchell explains that the Standard Oil cartel “built its domination of the American oil market by first monopolizing the refining industry, then controlling pipelines and shipping routes, and finally taking charge of distribution, replacing independent importers and wholesalers with Standard Oil's own worldwide networks of storage tanks, horse-drawn carriages, and reusable tin cans.”
By gaining an end-to-end monopoly over the oil industry’s supply chain, the Rockefellers not only grew immensely wealthy, but they also positioned themselves as key players within America's foreign policy establishment. By the turn of the century, oil had become such a critically important resource to the success of American military operations and the growth of its economic power that national security planning could no longer be conducted without the active participation of the Rockefeller family.
During the late 19th and early 20th centuries, the primary other oligarchical faction that the Rockefellers shared power with was the House of Morgan, the most powerful and influential banking house on Wall Street. As F. William Engdahl describes, “by the end of the 1890’s, Morgan and Rockefeller had become the giants of an increasingly powerful Money Trust controlling American industry and government policy (and) accumulating and consolidating vast fortunes - largely through fraud, bribery of public officials and Congress, corruption, forced bankruptcies, and other ‘noble’ practices.”
In his book Seeds of Destruction, Engdahl offers further detail on the unsavory business practices that brought about the spectacular rise of the new-money capitalistic dynasties of the Gilded Age, writing that “in their rise to unprecedented heights of power, the Morgan and Rockefeller interests deployed fraud, deceit, violence, and bribery.” Together, they conspired to engineer financial panics, which were “brought about through their calculated control of financial markets and banking credit, allowing them and their closest allies to consolidate ever more power into fewer and fewer hands. It was this concentration of financial power within an elite few wealthy families that created an American plutocracy or, more accurately, an American oligarchy.”
As Engdahl informs us, Aristotle had originally coined the term oligarchy “to describe rule by the wealthiest families, where voting power in the state was related to the size of a family’s fortune.” Applying this concept to America, he notes that “the real power in the spectacular rise of the American Century at the end of the 1890s did not rest democratically in the hands of the majority of citizens. … (Instead), power, together with control over the nation’s economy, was being ruthlessly centralized in the hands of the wealthy few, every bit as much as it had been in the days of Imperial Rome.”
Americas ascendant oligarchy was centered around an elite syndicate of powerful industrial and banking corporations linked closely to America’s national security establishment - with Morgan and Rockefeller at the center of this nexus. This corporate cabal “used its immense economic power, often secretly and in coordinated fashion, to orchestrate events that generated waves of bankruptcies and severe economic depressions, even panics.” The oligarchical rulers behind this Money Trust “cynically corrupted and co-opted state legislatures, governors, US Congressmen, judges, newspaper editors, and even Presidents to serve their private interests, (which) were served by wars their captive press helped trigger - wars from which that oligarchy profited while thousands (and even millions) of young Americans perished for causes they knew nothing about.”
America’s oligarchical elite operated outside the parameters of the US Constitution, becoming the basis of what many geopolitical analysts today term the “Deep State.” In his book American War Machine, Princeton professor Peter Dale Scott, one of the intellectual pioneers of this concept, explains that the term “Deep State” references the existence of “a shadow government, or a state within a state”.
In his explication of the idea, he cites Father Javier Giraldo of Colombia, who described how this type of shadow government functioned within the context of Columbian politics in the 1970s and 80s: “The Colombian state is contradictory. It tries to fulfill two functions. On the one hand it’s a violent, discriminatory institution that must favor a small wealthy minority. Even basic necessities are denied to the great majority of its people. By its very nature, at its core, it is not democratic. On the other hand, in public discourse it presents itself as a state based on law, one that respects and implements justice, human rights norms, democratic laws.”
Giraldo asks “how do government functionaries manage this contradiction? They maintain a duality: the parastate, a structure that is illegal and clandestine, increasingly takes over the dirty work, the repression. It doesn’t appear to be part of the state. For many years now Colombia’s government has been creating and maintaining these structures, (with) the legal, constitutional structure existing parallel to structures of a parastate and paramilitary” - i.e. a Deep State.
Describing the relationship between the Deep State and the overt government of a nation, Peter Dale Scott references the idea of “deep politics”, which is “the constant, everyday interaction between the constitutionally elected government and subterranean forces of violence - forces of crime - that appear to be the enemies of that government.”
One way these interactions occur is through a “hands off” policy that the government adopts towards its Deep State elements. As an example, consider the CIA, which, “for most of its existence, operated under a secret exemption from legal review of its actions.”
Another interaction pattern is through outsourcing Deep State operations to private corporations. As an example of this, Scott points to “the American company Aramco, representing a consortium of the oil majors Esso, Mobil, Socal, and Texaco.” This corporate cartel “conducted its own foreign policy in Arabia, with private connections to the CIA and FBI.” Later, in coordination with the CIA, Aramco funded, as a means to consolidate US control over Middle East oil, “not only the Saudi monarchy but also its creation the World Muslim League, which in turn fostered Wahhabism, Islamism, and the forces of al-Qaeda throughout the world.”
Here we discover the imperial ambitions of a “shadow government” being advanced through the actions of oil corporations on one hand and US intelligence agencies like the CIA on the other. In the Deep State, public and private-facing institutions work together and form a symbiotic relationship with one another, becoming inseparable in their activities. This type of partnership forms the basis of the Deep State, which is neither exclusively public nor exclusively private but comprised of a synthesis of the two.
To pinpoint the origins of when this hybrid public-private approach to empire first began to develop, we have to consider once again the topic of oil: oil had become such a vital component to modern warfare that the corporate cartel who had amassed monopoly control over its supply chain - Standard Oil - became an integral asset to American national security interests. The Rockefeller oil cartel was therefore not merely an economic entity but an instrument of oligarchical rule and a weapon of imperial domination.
The close relationship that developed between American banks, industrial cartels, government officials, and the National Security State became the basis of the Deep State. Together, this nexus of public-private interests formed what Father Geraldo called a “parastate”: a shadow government secretly controlling the mechanics of the overt government, manipulating it from behind the scenes and pushing it in an imperial direction. When people talk about the US “Deep State”, this is what they're referring to: it’s not a “conspiracy theory” but a fundamental aspect of how American society works.
Hey, Alexander -
I just want to take a moment to let you know how much I appreciate your work, and your dedication to uncovering the Truth. Thanks for your continued efforts!
Keith