Table Of ContentRodney Loeppky
A Deal They Can’t Resist
De Gruyter Contemporary
Social Sciences
Volume 7
Rodney Loeppky
A Deal They
Can’t Resist
Adaptive Accumulation and American Public Policy
ISBN 978-3-11-076174-0
e-ISBN (PDF) 978-3-11-076180-1
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ISSN 2747-5689
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Contents
Chapter 1: Introduction 1
Chapter 2: Adaptive Accumulation: Public Objectives, Private Revenues 7
Chapter 3: The Military and Adaptive Accumulation 18
. Defense Policy as Public Policy 19
. Peace Dividends: Do More with Less (or More?) 21
. Transforming Power Projection Abroad 23
. On the Homefront: Utilities and Housing 29
.. Utilities 30
.. Housing 33
. Conclusion 38
Chapter 4: Health, Healthcare, and Adaptive Accumulation 39
. US Health Reform Through the Twentieth Century 40
. Adapting the Component Parts of US Healthcare 43
.. Transforming Medicare 44
.. Drugs, USSeniors, and Medicare 50
.. The Affordable Care Act 54
. Conclusion: The Future of US Health 60
Chapter 5: Education Reform and Adaptive Accumulation 65
. Education as Crisis 66
. Mining Public Schools 68
. Governmental Market Makers 78
. Education and the Culture of Choice 85
. Conclusion 89
Chapter 6: Incarceration, Detention, and Adaptive Accumulation 91
. The Neo-conservative Turn and ‘Law and Order’ 92
. Corporate Strategies in Incarceration and Detainment 95
. Government, Public Policy, and Incarceration 103
. Politico-Cultural Undercurrents: Conditioning Incarceration 113
. Conclusion 118
Chapter 7: Conclusion—Moving Forward in America 120
VI Contents
References 127
Index 143
Chapter 1: Introduction
The study of America is the scrutiny of contradictions. It is, after all, a place
where unparalleled wealth is accompanied by extensive, grinding poverty.
Whereelsedowefindthemostadvancedbiomedicalandhealthestablishment
intheworld,matchedbytheexclusionoftensofmillionsfromhealthcare?Itisa
society with a reverence for individual rights and freedoms, but one which has
also fostered the largest per capita prison population in the world. Indeed, in
the land of ostensible equality and opportunity, the extent of class, race, and
gender inequalities often feels overwhelming. Some have argued that these so-
cialincongruitiessignaladecayingsociety,possiblyeventhedeclineofaUSem-
pire,notdissimilarfromthecorrosivedynamicsthatextinguishedancientRome
or allowed the sun to set on the British Empire (Wood, 2004; Ferguson, 2005;
Greer, 2014).
Americans, however, have neither viewed themselves with such grandeur
nor understood themselves operating within any predictable pattern of history.
Onthecontrary,arevolutionaryhistoricalnarrativepervadesAmericanpolitical
culture,with‘exceptionalism’remainingaconstantrefrain.Thespecialbrandof
US democracy and its faith in human progress,the capitalist marketplace, and
theindividualwill,ultimately,arethoughttoovercomeallchallenges.Mostpo-
litical economists and social theorists, of course, have viewed this proposition
with skepticism, focusing their criticism on the specificity of US capitalism,
with its strong neoliberal characteristics and grossly unequal social outcomes.
Nowhere in the capitalist world have the extensions of the free market been
asgreatastheyhaveintheUnitedStates,whereNancyFraser(2019)hasargued
that the post-Reagan battle between reactionary neoliberals (Republican-led)
andprogressiveneoliberals(Democrat-led)hasresultedinthehyper-reactionary
neoliberal brand of the Trump administration.
ThepoliticaluniversethatTrumpupendedwashighlyrestrictive.Itwasbuiltaroundthe
oppositionbetweentwoversionsofneoliberalism,distinguishedchieflyontheaxisofrec-
ognition.Granted,onecouldchoosebetweenmulticulturalismandethnonationalism.But
one was stuck, either way,with financialization and deindustrialization.With the menu
limitedtoprogressiveandreactionaryneoliberalism,therewasnoforcetoopposethedec-
imation of working-class and middle-class standards of living. Anti-neoliberal projects
were severelymarginalized,if notsimplyexcluded, from thepublicsphere(2019,p.18).
ThisisnottosaythatneoliberalcapitalismintheU.S.proceedsinacompletely
unfettered fashion—US capital is subject to state regulation (both federal and
state), just like everywhere else in the world. But US political culture validates
https://doi.org/10.1515/9783110761801-001
2 Chapter1:Introduction
marketcompetitionacrosssocietalactivitiesthatareviewedelsewhereasinher-
ently public—from postal service to post-secondary education, from healthcare
to incarceration. Even in its willingness to project military power abroad,polit-
icaleconomistsseethemaintenanceofan‘empireofcapital’,pryingopensoci-
etiestobetteraccommodatethefreemovementof(especiallyUS)capital(Wood,
2002).
Whyshouldanyofthiscomeasasurprise?Afterall,thishaslongbeenthe
ageofneoliberalism,thehistoryofwhichputstheAnglo-Americanworldatthe
cuttingedge.Thepedigreeisdifficulttodeny:fromtheReaganandThatcherrev-
olutions,through‘thirdway’ClintoniansandBlairites,andontothefull-blown
neoliberal fury of the Trump and Johnson administrations. Neoliberalism in
Anglo-Americancountriesissaidtobemorethanjusttheuptakeofclassicallib-
eral principles—rather, it is the unwavering disavowal of all things Keynesian
and the systematic dismantling of the institutions of post-war society (Peet,
2003). At the same time, however, more than a whiff of hypocrisy is notable
here, because this disavowal only seems to hold while capitalism is bullish in
nature.Wheneverprospectsforeconomicgrowthslow—theSavings&LoanCri-
sis,BlackMonday,the2008financialcrisis,ortheCOVID19shutdown—eventhe
starkest free market advocates in Congress and elsewhere willingly endorse
multi-billion or trillion-dollargovernment interventions.
Thisbookinterrogates,beyondsuchbailouts,whetherthe‘unbridled’brand
ofUSneoliberalism,infact,alwaysholdstrue.Certainly,thefinancialcriseslist-
ed above demonstrate an especially free ranging financial market,with a good
deal of industry-friendly regulatory oversight. In that arena, it could be said
thatthestatehas,intermittently,recededfromview,allowingamuchwider,un-
supervised ambit of corporate activity. And one would be correct for sensing a
moregeneral‘retreatofthestate’acrossawidearrayofactivities,asthespecter
of ‘privatization’ seems ubiquitous at all levels of government. It has been esti-
mated,infact,thatofthe$6trillioningovernmentspendingacrosstheU.S.,at
leastafull$1trillionnowgoestoprivatecompanies(Ball,2014).Alargepartof
thatprivatizationdynamic,however,doesnotsuggestthestandardimageofgov-
ernment‘gettingoutoftheway’.Thisworkmaintainsthattherehasbeenalarge-
scalemovementofcapitalintocentralpublicpolicydomains,wheregovernment
retains and even builds on its dominant functions. More specifically, it argues
that part of the development of US neoliberalism involves adaptive accumula-
tion, a process in which capital allies or aligns itself with public objectives
andinstitutions,asameanstotransformorreroutepublicrevenuesintoprivate
profitstreams.Alongtheway,corporateorganizations‘adapt’theirrolesaspure
market actors, taking up and inhabiting quasi-public aspirations as a central
part of their commercial mission. The state, in all its complexities, proceeds
Chapter1:Introduction 3
with this relationship, as it both addresses budgetary dilemmas brought on by
regularroundsofausterityandextendsorcarvesoutnewareasofaccumulative
growth for corporate America.
The sectors involved range in scope and magnitude, from substantial to
enormous, but the present work does not presume to capture every manifesta-
tion of this process. Instead, it gives an indicative account of concrete cases
that challenges our sense of a hyper-neoliberal US political economy, where
the ‘rules of reproduction’ are not as self-evident as we might assume. Samuel
Knafo andBenno Teschke(2020)havemade theargument that whenweexam-
ine historicallyspecificcases of capitalistdevelopment, it is imperativethatwe
notreadthenatureoroutcomeoftheirdevelopmentfromsomeinherentattrib-
utesofcapitalism.Intheauthors’words,thereisanecessitytoavoid,“afetish-
izedconception,”where“[what]isconceptually renderedasanauto-generative
logicofactiongrateswith thehistoricaltrackingofcapitalism…asacontested
and concrete process” (2020, p.77).The authors seek “to open up space for re-
thinking capitalism as a historically open rather than theoretically-closed cate-
gory”(2020,p.77).Theutilizationofadaptiveaccumulationtoviewthespecific
natureofUSpoliticaleconomydemandsthissamehistoricallyopenperspective.
It requires that we consider the existence of a symbiotic relationship between
state and capital across a range of significant economic sectors, potentially, as
a constitutive part of American neoliberal development.
In order to makethis argument,the workexamines four separatearenasof
public policy—military, healthcare, education and incarceration—as cases in
which adaptive accumulation has taken hold. Taken together, these sectors
make up averylarge portion of public and private spendingand, as such, rep-
resent a large share of US economic activity. Cobbling together estimates from
only K-12 education, health, and incarceration, total government spending in
these areas amounted to almost $5 trillion in 2019 (Wagner and Rabuy, 2017;
Martin et al., 2021; Hanson, no date). Potentially, this reveals two possibilities
with respect to US political economy. The first, obviously, is that sectors of
such size exhibit a broad appeal for those seeking profit streams, as room to
transform public spending through adaptive accumulation remains extensive.
Second, and more important, it might be fair to say that US economic strength
is as reliant on these publicly-funded sectors as it is on the vitality of either
itsdomesticconsumptionofgoodsoritsfinancialsector.Thisissignificant,be-
cause within political economy, much of the sectoral spending involved would
be categorized as ‘unproductive’ components of economic activity.The implica-
tion is clear: in the heartland of neoliberal capitalism, publicly-funded sectors
actuallyconstituteoneofthedifferentiaspecificathatdrivesAmericancapitalist
development.Ratherthanseeingthemaseithermarginalattemptsto‘shoreup’
4 Chapter1:Introduction
capitalism or bloated government spending, it might be better to understand
them as concrete specificities, integral to the US capitalist engine.
Before getting to these sectors, however, the second chapter provides the
basicoutlinesforadaptiveaccumulationasaninterpretivelens.Withthestrate-
gicaimofreadability,thechapterhasbeendeliberatelylimitedinsizeandcon-
ceptualscope.Thoselookingforalong,meandering,oroverlyabstractsurveyof
literature on the state and political economy, or a‘deep dive’ into value theory
and accumulation,will have to look elsewhere.The point here is to specify the
context of US neoliberalism, from which questions concerning the unique
formofUScapitalistpracticesemerge.Fromthis,thechapterpositionsadaptive
accumulationwithinamorecriticalsetofperspectivesoninstitutions,anditsets
outthevariousfunctionsthatsuchaccumulationservesitsparticipantsocialac-
tors. Ultimately, the objective is an enhanced understanding of neoliberalism,
where we gain both a different version of ‘privatization’ and a more nuanced
view of what the public realm means for corporate actors.
The thirdchapterproceeds toan examination of the public policysector in
whichtalkofstate-supportedcapitalismallbegan:themilitary.Readersare,no
doubt,morethanfamiliarwiththenotionofa‘military-industrialcomplex’,and
it is the contemporary widespread application of that concept to other sectors
that motivates a re-examination of neoliberalism in the American context. Log-
ically,then,theworkbeginsbyexaminingthepotentialfor adaptiveaccumula-
tion in US military matters.Importantly,the chaptergoesbeyondweapons pro-
curement issues usually involved in such discussions, as they have been both
wellexploredelsewhereandarenotespeciallyindicativeofadaptiveaccumula-
tion.Instead,ithighlightsthemorerecentwaysinwhichUSmilitarypolicy—asa
form of public policy—has redirected societal revenues into private profit
streams.Thisisapublicpolicyprocessspecifictotheneoliberalera,anditdem-
onstrates the manner in which corporate actors have been‘drafted’ into public
objectives, all with an eye to maintaining forward deployment capacities and
an increasingly expensive high-tech arsenal in the context of an uncertain
post-Cold War budgetary environment.
Following this, chapter four explores the domain that is often cited as the
onlyseriousrivaltodefensespending:healthandhealthcare.Healthconstitutes
animmenseareaofactivity,inwhichgovernmentinvolvementhasgrown,even
whiletheU.S.remainstheleadingcaseoffreemarkethealthdeliveryworldwide.
Here, the argument is made that across several government-run or -regulated
healthcarestructures,fromMedicaretoso-calledhealthcareexchanges,corpora-
tionshavebeenabletoinsertprivateformsofhealthcarepurchasingandprovi-
sion,supportedbygovernmentpaymentsandsubsidies.ItiswellknownthatUS
spendinginhealthistypicallytwiceasexpensiveasitisamongitsadvancedin-
