California Free Press

Off the Top of My Head

Biden's Goal of 50% Electric Vehicles by 2030 in Peril Because of American's Freedom of Choice

by John Lawrence

Fast forward to 2029 and we find ourselves in the situation that many Americans are insisting on purchasing gas fueled vehicles because of their freedom of choice. Even though the government has subsidized electric vehicles to the tune of $10,000 per vehicle, and electric vehicles outperform gas powered ones in every category, even though electric vehicles have more bells and whistles than the same identical gas powered one, Americans are insisting that their freedom of choice is more important than helping President Biden reach his goal of 50% electric vehicles on the road by 2030. Wolf Blitzer's son, Chip Blitzer  interviewed Joe Blow of Shrevesport, Louisiana. Blitzer: "Why do you want to purchase a gas powered vehicle when the electric one is cheaper and a better performer?" Blow: "My Daddy drove a Ford F-150 with an internal combustion engine which was the pride of America as did his Daddy before him. The internal combustion engine is what built this country. It's how we won every war we ever fought in. My Daddy was a roustabout in the oil fields and my family has a long history of fossil fuel products. You won't ever catch me in an electric vehicle as long as I have my freedom of choice."

President Biden is considering mandates to get gas powered cars and trucks off the road, but some southern Governors are balking at that. Governor P.T. Abernathy of Texas said this: "The Federal government is overstepping its bounds when it comes to telling us here in the south what kind of vehicles we can drive. I've always preferred a gas powered vehicle myself, and, as long as I'm Governor, I will let our citizens decide for themselves what kind of vehicle they want to drive. It's unAmerican to dictate to American citizens that they have to drive an electric vehicle. We also won't be following Federal government incentives to get people to move out of flood plains." Back in Shrevesport Mr. Blow had this to say. "I ain't moving out of my house even though it is in a flood plain. My Grandpappy built this house. We Blows have lived here for generations, and no Federal government is going to order me to move out of my house." It is notable that 2 years ago, FEMA gave Blow $350 K to rebuild his house after Hurricane Upsilon totally destroyed it. Yet Blow said at the time: "I've never seen anything like it before in my life, but I will rebuild. I'm not going anywhere. This is America."

We note that in blue states people are 90% compliant with Biden's goal. They are buying electric vehicles at a fast rate taking advantage of the generous government incentives in doing so. Red state Governors on the other hand are imploring their residents to support the oil and gas industry by buying gas powered vehicles making it less likely that Biden will reach his goal of 50% electric vehicles on the road by 2030. Despite the cleaner air that has come with more electric vehicles on the road not to mention helping in the effort to forestall and mitigate global warming, many in southern states primarily are insisting on their right to choose as Americans citizens. Ex-President Donald Trump said at a CPAC convention: "Global warming is a hoax. We have so many wonderful oil and gas resources in this country that we'll never have to import another barrel of oil. Yet these socialists like Biden want to cripple that industry destroying the livelihoods of red blooded Americans to feed their families." As a result of American hesitancy to go ahead and buy electric vehicles, Biden will probably not be able to reach his goal. One guy from Alabama said: "Have these electric vehicles even been FHA fully approved. I heard that they were just provisionally approved. When there is full FHA approval, then I might consider buying one. In the meantime I'll just stick with my F-150 with the American internal combustion engine, the engine that made America great. Don't tell anyone, but I take off that godforsaken catalytic converter every time I buy a new pickup. Internal combustion rules, baby! Let 'er rip!"

The Real Socialism in America Isn’t What You Think

by Robert Reich

Wednesday, August 25, 2021

You may have heard Republicans in Congress rail about how the Democrats’ agenda is chock-full of scary “socialist” policies. 

We do have socialism in this country — but it’s not Democrats’ policies. The real socialism is corporate welfare. 

Thousands of big American corporations rake in billions each year in government subsidies, bailouts, and tax loopholes – all funded on the taxpayer dime, and all contributing to higher stock prices for the richest 1 percent who own half of the stock market, as well as CEOs and other top executives who are paid largely in shares of stock. 

Big Tech, Big Oil, Big Pharma, defense contractors, and big banks are the biggest beneficiaries of corporate welfare.

How? Follow the money. These corporations and their trade groups spend hundreds of millions each year on lobbying and campaign contributions. Their influence-peddling pays off. The return on these political investments is huge. It’s institutionalized bribery. 

An even more insidious example is corporations that don’t pay their workers a living wage. As a result, their workers have to rely on programs like Medicaid, public housing, food stamps and other safety nets. Which means you and I and other taxpayers indirectly subsidize these corporations, allowing them to enjoy even higher profits and share prices for their wealthy investors and executives.

Not only does corporate welfare take money away from us as taxpayers. It also harms smaller businesses that have a harder time competing with big businesses that get these subsidies. Everyone loses except those at the top. 

It’s more socialism for the rich, harsh capitalism for the rest. 

It should be ended. 

"Socialism" is the Slur du Jour

by Frank Thomas

 

I fully agree there's a dire need for an intelligent Democratic counter strategy, Jerry, to the non-sensical lashing out of  the label "socialism" by the right and its standard barrage of ad hominem one-liners. This labeling often reaches a desperate, severely insulting, even vitriolic level, e.g., calling Obama a fascist, and a socialist, and a communist - calling his health care plans a massive leap into central government planning and control. The right has become politically powerfully adept resorting consistently to attack ad hominems like, "socialism and socialistic," or  "any form of socialism leads to Big Brother government control and loss of freedoms."  Another example is Wayne LaPierre's (chairman of the NRA lobby syndicate) response to a public call for prompt, concrete, strict gun restrictions: "Socialists, in typical European style, want to take away our God given freedoms, the next one the right to own a firearm." Then he warns us, "You must be afraid." 

"

"Socialism" is the slur du jour ad hominem of the conservative right to denigrate, demean, distort, deflect, demonize liberals and ideas the right disagrees with. We have a long history of lumping "socialism" with almost all things "liberal." Today for many, the label continues to serve as an effective, if cynical sledgehammer against civil, rational, constructive give-and-take policy decision-making. Now Trump is becoming the new master socialist-accuser by tweet. The conservative right's long standing traditional fear is that America will turn into a decadent, socialistic age-old Europe. Thus, given our nation's long history of anti-socialist sentiments, it's good conservative strategy, e.g., to associate universal health care with "socialism." This applies to most government interventions. So Medicare and Medicaid are carrying us into the abyss of run-away socialism as is happening in Canada and Europe - so goes the ideological rant! American conservatives hold this philosophy sacrosanct for most government interventions while the 2009 great financial meltdown crisis of all crises showed once again how laissez faire capitalism is prone to extremely dangerous, costly market failures - given pure capitalism's natural inclination of blatant abuses and concentration of money in fewer and fewer hands. And this leads to a concentration of power. 

 

Since the New Deal, ideological battle lines over socialist or governmental intrusions into American lives have increased. For conservatives the political cry is liberty through capitalism and free markets. For liberals the political cry is equality through equal opportunity, government oversight, and social responsibility. Both liberty and equality have made great contributions to our nation since its founding. As I've said in previous writings, it's all about getting the right balance between capitalistic and social elements that fit a particular culture.  In Europe, the  political norm is that, "Whatever promotes the general welfare will also promote personal happiness and motivation as well as economic progress." This contrasts with the U.S. indoctrinated conservative norm starting in 1980 that , "Whatever promotes the corporate and individual welfare promotes the general welfare."  

 

The reality is that democracy needs a healthy balance and tension between these two elements to survive. Looking way back, it seems a miracle that at the high point in our cold war with Russia, a limited form of socialized medicine - Medicare - passed Congress and resistance by the insurance industry and the American Medical Association. Those forces now have teams of lobbyists influencing every key (and bought) Congressman in the policy-making process. The ordinary American ends up in effect having: no right to life if an insurance firm can deny one's coverage because of a prior illness history or inability to pay; no right to elect his or her leaders if a fair election or governing process is unjustly compromised or corrupted; no right to an equitable income if tax cut programs are designed to overwhelmingly favor the upper social class with the greater material influence.   

 

The European Way sorts out conflicting and competing interests behind capitalism's tremendous wealth creating capacity so that income and social benefits are broadly and fairly shared. Europe's  social democracies and market economies embrace the principles of both pursuing a free market and serving humanity. As one researcher explained, social democracy is all about a healthy, well-managed, thriving public system in education, health care, transportation, clean environment, child care, libraries, parks. It's all about government programs and blends of policy in concert with a competitive capitalistic dynamic that improve (or do not improve) the conditions of people's lives. In Europe, It's in general a very self-critical, exceptionally transparent process supported in most countries by multi-party systems and coalition governance where constructive compromise is a sine qua non. But the American conservative right disingenuously derides Europe's social-economic democratic model with the idiotic ad hominem one-liner it's essentially a welfare state. A better one-liner is workforce state. 

 

Meaning all social networks operate as part of a comprehensive system of institutions and policy decision-making that's geared towards keeping individuals and families healthy, productive, free working individuals to insure a vibrant, sustainable economy. This approach was originally conceived as a security revolution, NOT a socialist revolution by the conservative politicians - Churchill, Monnet, Adennauer, Schuman. In the words of Monnet, "Europe  will be attained by concrete achievements generating an active community of interest." The result since 1950?  There are as many if not more European Fortune 500 companies than U.S. China or Japan. The Netherlands, for example, is a small land one-half my state of Maine with nearly 18 million people with some very reputable, innovative world firms including Unilever, Phillips, Royal Dutch Shell, Heineken, KLM, DSM, ASML.   

 

Europeans in general don't see their unique form of hybrid capitalism with its high degree of economic freedom AND socialist elements as a conflicting societal norm ... but rather as a mutually reinforcing norm for improving the lot of ALL citizens. The developed economies of mature European countries are in essence "hybrids" that are constantly being refined. The private management is capitalistic while being the home also of public oversight and social institutions, providing strong job protections, well-trained labor markets and centralized unions, affordable quality health care and good coverage, relatively low-cost trade schools and colleges. Success has NOT been achieved by being more Right or more Left, by being more Capitalistic or more Socialistic. Labeling people, policies, programs socialistic and capitalistic as a discussion norm is seldom if ever done to evoke emotional reactions or to make prejudgements or charges that distort reality. The degree to which American conservatives automatically invoke the frightful specter of "socialism" serves no constructive purpose in advancing inclusive, creative, balanced, policy discussions and actions in Europe within multi-party and coalition governing systems. 

 

Here are a few words on "socialism" in 2009 by Jefferson Cowie and Nick Salvatore, American History Professors, Cornell University  

________________________________________________________________________________________________________________

 

"When socialism can be used interchangeably with fascism - as it often is in the heat of contemporary political debate - Americans 

are playing with historical fires they do not understand. America has not had a politically meaningful socialist movement since that 

of Eugene Debs early in the last century. The Soviet Union has perished, the Berlin Wall has fallen, and capitalistic China is our 

No. 1 industrial competitor. Against such a political landscape, what meaning could socialism have even as an epithet?

 

Those who hurl the "s-word" misunderstand the role of the state in American history. While they accurately point to the enormous 

growth in government since the Civil War and claim that it has stripped Americans of their individualism and self-reliance, the focus 

of the state's activities has been subsidizing and promoting "private" enterprise. Government growth promoted by Gilded Age 

Republicans, New Deal Age Democrats, and Reagan revolutionaries has been one of the most enduring constants in American 

history. Despite regular election cycle pleas to shrink the size of government, a unifying theme of political experience has been the 

government's growing intervention in the market on behalf of the business community.

 

For an exceptional few decades, however, things were different. Sparked by the Great Depression and the rise of the New Deal, the 

government expanded its responsibilities to include working people as well as business. It was not accidental that between 1945 and 

1972, while business grew drastically, income inequality declined significantly for Americans while posing no threat to the nation's 

wealthiest. Nor was it accidental that in the decades of growth since the early 1970s, a reversion to uniformly pro-business policies

promoted a significant rise in income inequality with the top 1% of all incomes enjoying the largest percentiles of growth. This too is

partly a direct result of government's beneficience to the private sector (business).  

 

The issue, therefore, is not government intervention, yes or no; rather it is on behalf of whose interests government intervenes. When

the government assists business by bailing out the financial markets - as it often should - it is called supporting the market. When 

government helps regular folks, as with health care reform, it stirs fears of something called "socialism."

 

Republican Theodore Roosevelt understood the central role of property for American individualism and citizenship - much like those 

who wield the fear-laden charge of "socialism" today. But, he argued in 1910, when human rights are in conflict with property rights,

"human rights must have the upper hand, for property belongs to man and not man to property." Some today would call this "socialism." 

My summary one-liner advice to Democrats: they should stop hiding and running from the words "socialism" and "socialistic." They should make the policy blend of social welfare and capitalism their way to  best achieve a humanly, democratically and financially sound, just, equitable, social-economic-political environment. They should talk up the good parts of it, take the heat when necessary and be transparently on the offensive for ALL Americans every day - especially for the bottom 90% to counter our movement into autocracy.

Off the Top of My Head

Conservatives Argue That Phasing Out Fossil Fuels is Socialism. They Argue That Saving the Planet from Global Warming is Socialism. They Argue That Universal Health Coverage is Socialism. I Say Bring It On!

by John Lawrence, October 27, 2020

So anything that would benefit the people as a whole or the planet is socialism. Creating jobs by a government sponsored infrastructure program is socialism. Yet private enterprise has not built any infrastructure. It won't do so unless the money is provided by the government. Rebuilding roads and bridges is not something private enterprise is equipped to do. If it was, they'd build roads and bridges and then charge tolls to recoup their investment. Private enterprise is good at inventing things and starting entrepreneurial enterprises, but not large picture enterprises which are properly the domain of government or require government cooperation with the private sector. A government that makes sure that everyone has health care complements private enterprise. They want healthy workers after all. Private enterprise benefits from safe roads, tunnels and bridges more so than does the average citizen. They use infrastructure in the conduct of their business.

President Reagan declared that “government is not the solution to our problem, government is the problem.” Yeah, it's the problem when it doesn't do its proper job. It's the problem when President Trump doesn't take any responsibility for the pandemic or attempts to do anything about it. Reagan also said that the nine most terrifying words in the English language were, "I'm from the government, and I'm here to help." Really? We could use a little help from the government in the midst of a pandemic. The private enterprise system is doing its part inventing a vaccine, but they're doing it with the help of government money. Pfizer got $1.95 Billion to produce a coronavirus vaccine by the end of the year. Johnson & Johnson got a billion dollars. Without government being "here to help" there would be no vaccine on the horizon. Private enterprise would not take that money out of its own research budget especially if it didn't figure to make a profit selling the vaccine.

So socialism will be responsible for developing a coronavirus vaccine and eventually ending the pandemic. It will be done with the "government help" that Ronald Reagan thought was so terrifying. The problem is that we have socialism for the rich and capitalism for the poor. The rich spend tons of money lobbying Congress to pass legislation in their favor. In a truly free market they wouldn't be spending money making sure government was doing their bidding in their interests. They would be spending money on research, development and promoting their products. Rich people don't want government so small that they can "drown it in the bathtub" as Republican lobbyist Grover Norquist said. No, they are manipulating government everyday to get government just the right size to suit their financial interests. Defense contractors lobby to get the government to spend more money on the military-industrial complex. Pharmaceutical corporations lobby to get government not to allow Medicare to negotiate with them for lower drug prices. This is something Joe Biden said he would do: allow Medicare to negotiate drug prices with Big Pharma.

Most civilized nations have universal health care. The US is the only outlier. Most civilized countries want to do something about global warming. The US under Trump is the outlier. Most civilized countries have a social safety net so that people don't suffer needlessly. At the same time most countries facilitate a partnership between government and private enterprise that works for entrepreneurs and business people and the citizenry as a whole, in partnership and cooperation. There is a balance between capitalism and socialism that works for the benefit of all the people. That's what makes for a successful nation. Right now this is very out of whack in the US. A bloated military has wasted trillions of dollars on disastrous wars that have made the nation less safe. And yet the military was absolutely impotent to do anything about COVID-19. The money would have been better spent strengthening our knowledge and preparations for a pandemic and for better health among Americans so that they don't have so many underlying conditions that have led to more deaths from the coronavirus.

As jobs are being destroyed by automation, robotization and AI, it's imperative that jobs be created addressing the needs of infrastructure and the need for renewable energy. This endeavor can be in part a joint mission for both government and private enterprise, but without government's input the nation will keep on spewing fossil fuel emissions into the atmosphere because that's what's in the interests of existing corporations. That dynamic needs to change and government has to be instrumental in bringing about that change. That's why it's important to elect Joe Biden and Kamala Harris. Many vested interests will continue making money by polluting and emitting greenhouse gasses unless government changes the dynamics of energy production. This means countering the demand of lobbyists and putting government in a direction that benefits the people as a whole and not just special interests.

VOTE!

 

 

Off the Top of My Head

Let's Talk About the Communist Bogieman

by John Lawrence, October 8, 2020

After the vice Presidential debate last night Trump called Kamala Harris a communist. Let's be clear: communism is a system in which the government owns all property and makes all economic decisions. Let's also be clear about this: nowhere in the world today does communism exist. Not in Russia. Not in China. Not in Cuba. In Russia private ownership of enterprises and property had essentially remained illegal throughout the Soviet era, with Soviet communism emphasizing national control over all means of production. In the 1990s, during the Presidency of Boris Yeltsin, there was  large-scale privatization of Russia's state-owned assets, particularly in the industrial, energy, and financial sectors. Privatization shifted Russia from the Soviet planned economy towards a market economy, and resulted in a dramatic rise in the level of economic inequality. It facilitated the transfer of significant wealth to a relatively small group of oligarchs.

In China private property and state owned enterprises co-exist. According to the NY Times: "Today, the private sector contributes nearly two-thirds of the country’s growth and nine-tenths of new jobs, according to the All-China Federation of Industry and Commerce, an official business group." In fact the reason why China has pulled 800,000 people out of poverty in the last 40 years is that the economy has been partially privatized. There are more billionaires in China than in the US. Many people in China went from being poor to middle class due to the privatization of the housing market. So although China is still ruled by the Chinese Communist Party, its government is communist in name only. They should probably eliminate the word "Communist" from the party's name.

Now consider Cuba. In 2010, Cuban leaders Fidel and Raul Castro made the decision to abandon the old Soviet model of centralized planning. In 2011, new laws were enacted to expand the right to private property. In 2019, a new Constitution was approved which officially recognizes the right to private property, while also reconfirming the central government's authority over the regulation of production and land.

So if the accusation that Kamala is a communist is ridiculous, what about socialism? There is not one definition of socialism. Many of the western democracies like France, Germany, the UK and Sweden, which are US allies, have been governed by democratic socialist parties. These societies have market economies including the encouragement of entrepreneurialism, but also have a government provided social safety net including universal health care, free or inexpensive education from pre-K through college, allowances for child care, elder care etc. Sweden's government even owned a hamburger chain until recently and owns Sweden's state-run alcohol monopoly Systembolaget. The democratic socialism advocated by Bernie Sanders and others is nothing more than a model based on Sweden where there are high taxes on the wealthy which provide a government sponsored safety net for the middle class and the poor. Today there is one more reason why there should be a strong social safety net: global warming. It is clear that private enterprise is not up to the job of reducing greenhouse gas emissions to zero within a reasonable amount of time, reasonable meaning before the earth becomes uninhabitable.

Today in the US we  have a nominal capitalist or free market economy, but even in this economy the government institutes the rules within which the economy operates. The rules are set up and tweaked by those in power, those who have the money to hire lobbyists to convince legislators to write the rules in their favor, namely large corporations and the very wealthy. Don't be fooled by the meme that the powerful don't want government regulations. They do want regulations, but regulations that favor their interests and not the interests, necessarily, of the average person who doesn't have the resources to influence legislation by hiring lobbyists.

Today Kamala Harris and other Democratic progressives are really taking the realistic middle ground when they advocate for government policies which will mitigate and reduce climate change and provide a social safety net for the American people. This goes against the interests of the oil and gas industry to be sure. To advocate for universal health care is to advocate for the health care system that Canada and all our allies already have in pace. To advocate for policies that reduce the out of bounds economic inequality by taxing the rich and spending the money on raising the economic level of the poor and lower middle class only makes sense. None of these policies make Kamala Harris a communist since communism doesn't even exist in the world today. Formerly communist countries have given way to hybrid economies in which private enterprise and state owned enterprises coexist with, in the case of China, private enterprise having been the significant factor in improving the lives of the Chinese middle class.

Today, the US has gone way overboard towards an economy controlled by the rich and powerful in their own interests. Economic inequality has gotten way out of hand. The balance needs to be redressed and only a government which uses its authority to diminish the economic power of the wealthy and augment the power of the poor and middle class can provide the necessary change. Good paying jobs can be created which address infrastructure and climate change needs. So more or less a Green New Deal or whatever else you want to call it is necessary. Too bad that Republicans have gone out of their way to demonize that name as they've gone out of their way to demonize Obamacare or any other initiative progressive Democrats put forth. That is their stock and trade - not discussing the merits but demonizing the name.

Off the Top of My Head

According to Trump Rebuilding Infrastructure is Socialism

by John Lawrence, August 29, 2020

Unless that is you use taxpayer money to pay a private corporation to do it. Public private partnerships mean that the government shovels money to a private corporation, and they do the work after taking much of the money off the top for profits, CEO salaries and overhead. Then that private corporation hires a bunch of people to do the actual work paying them minimum wage. Thus income and wealth inequality is maintained. If a government department did the work, there wouldn't be profits siphoned off, and the workers could be paid a living wage. But Republicans call this socialism. They'd call anything socialism in which an elite class didn't make a profit. A Green New Deal is nothing more than a rebuilding of infrastructure using workers who would be paid a living wage. Also they would be building and rebuilding infrastructure based on the paradigm of renewable energy. Energy from fossil fuels would be minimized. But according to Republicans, any endeavor which seeks to build renewable energy capacity is socialism. Why? Because it doesn't profit existing corporations. They care nothing about the future habitability of the planet, only short term profits.

Does Trump have a plan to rebuild infrastructure? I don't think so. He thinks our crumbling third world infrastructure is still OK. Joe Biden does have a plan to build green infrastructure. He just doesn't call it a 'Green New Deal'. So what approach would make better use of taxpayer money (although taxpayers would probably never be asked to pay for it because the debt would just be swallowed by the Federal Reserve)? So the real question is what approach would do the most to diminish economic inequality and help disadvantaged communities? Perhaps a Department of Infrastructure would do that. That would amount to a Green New Deal without calling it that. Private corporations are not interested in a Green New Deal because they are profiting off the use of fossil fuels and want to continue doing so. In the meantime how much infrastructure has Trump rebuilt in 4 years? Answer: none.

Trump has been intent on destroying every government department from the Environmental Protection Agency to the Post Office. Any department or agency that was devoted to the health and welfare of the American people or the environment in which they live is on the Republican hit list to be sacrificed to the maximization of profits. Sure it maximizes profits if a corporation doesn't have to clean up after itself. If it can pollute freely, it saves all that money that would be needed to clean up thus maximizing profits. So the idea that the government should protect the environment or should be concerned about clean drinking water or the health of the American people, that is called socialism by Republicans. To be fair it is not only Trump that should be blamed. Long before Trump acceded to the highest office in the land, the Republican agenda was to destroy every public institution including replacing the public school system with private schools which they renamed 'charter schools.' Their modus operandi was to replace every public institution with private corporations which would funnel all monies to the top while using the cheapest possible labor. This only exacerbates economic and financial inequality.

The Republican MO is actually to destroy social security and Medicare because they are public institutions created by Democrats that benefit or help the American people. They want the government to only fund the military-industrial complex and the vast military apparatus that supports military bases in practically every country of the world. Pax Americana. Only problem is it's not working. Bullying other countries and nations only works for a relatively short time until those being bullied figure out a strategy to get out from under it. While the US was looked at by other countries as a defender of a moral vision for the world, they were supportive of Pax Americana. Now not so much after a series of disastrous immoral wars and an obvious unconcern about what Frantz Fanon called "the wretched of the earth." 60 million refugees languish in camps. Is Trump concerned about them?

Trump will say whatever suits his interests even though it might be the exact opposite of the reality he has sought to create. Example: he says he supports veterans yet his first budget as President proposed to end a benefit for disabled veterans once they reached the minimum age for Social Security benefits. These veterans would see their income plunge from about $35,000 annually to about $13,000. The Trump budget also called for reducing housing vouchers for veterans. The number of homeless veterans had been falling for ears, but Trump's budget would reverse that trend. As always you can't just listen to what Trump says. You have to look behind the curtain to see the manipulator who has no qualms about saying one thing and then doing the exact opposite.

Off the Top of My Head

The Left Right Political Spectrum is Meaningless

by John Lawrence, August 25, 2020

Trump is hoping to be reelected by labeling Joe Biden and the Democrats as radical socialists - far left - disciples of Fidel Castro who want to turn the US into a communist state. They are living in the mindset of the 1950s when the one dimensional political spectrum had some meaning. However, it is just an abstraction which doesn't even apply to present day realities. At the very least the political spectrum is two dimensional if not multidimensional. This is not the Leave it to Beaver 1950s where everyone celebrated the victory of freedom over fascism and everyone came home from the war with the GI bill which allowed them to buy a reasonably priced house in Levittown and secure their piece of the American Dream.

But wait a minute. In the 1950s black veterans were not allowed to buy a house in Levittown. Black folks were not allowed to ride in the front of the bus or drink out of the same drinking fountain in the South. The idyllic picture of American life did not even apply to Jews who were not allowed to buy real estate in La Jolla, CA, a ritzy suburb of San Diego. The American Dream was only for white folks. The Democratic party was composed of northern union members and farmers and southern segregationists. Black people, if they were allowed to vote at all, voted Republican, the party of Lincoln who freed the slaves. Then in 1964, when the Civil Rights Act was enacted and signed into law by a southerner, Lyndon Johnson, white southern supremacists switched sides and were welcomed into the Republican party. Black people switched sides and became, by and large, Democrats. The Republican party became the White Peoples Party (WPP) which is what it represents today.

The one dimensional political spectrum, which might have had some relevancy in the 1950s, is irrelevant today. The Republican party is still in the mindset and the paradigm of the 1950s as they try to tar and feather Democrats as far left radical socialists. The fact of the matter is that most advanced countries in the world today are combinations of capitalism and socialism. Take Denmark for example. Denmark has a comprehensive social security net and hence has been characterized as socialist. However, the entrepreneurial culture in Denmark is thriving. Clusters within information technology, life sciences, and clean tech are booming. And so are entrepreneurial clusters within food, maritime and design. There is a very strong collaboration across Danish government, investors, startup communities and enterprise companies, which has been instrumental in boosting entrepreneurship in Denmark. Between 2014-2016, there was a 360 percent growth in the number of Danish small businesses. So is Denmark capitalist or socialist? The answer is that it is both.

Denmark has universal health care as does every other advanced industrialized country on earth. Yet Republicans want you to believe that Medicare for All is a socialist system. The fact is that the US is an outlier when it comes to universal health care, That makes the Republican party's attempt to label Bernie Sanders and his advocacy of universal health care ridiculous. If anyone's radical when it comes to health care, it's the Republican party which is trying to pull the wool over your eyes and have you believe that Medicare for All is a radical socialist idea. It's not. What's radical is the health care situation in the US compared to every other advanced industrialized nation.

Trump and his associates never tire of calling China the "Chinese Communist Party." The reality is that China is also a hybrid of capitalism and socialism. China is primarily a one party system although there are other political parties in China. In practice, only one political party holds effective power at the national level, namely the CCP. Its dominance is such that China is effectively a one-party state. The eight minor parties are part of the United Front and also take part in the political system, but they have limited power at the national level. China is a 5000 year old civilization and in a sense the Chinese Communist Party is really the Chinese Party. It is communist in name only. The reality is China's booming economy produced a 206% increase in the number of billionaires there within just five years. China's richest man is Alibaba founder Jack Ma, with a net worth of $39 billion. China brought 800,000 people out of poverty in 40 years. It is engaged in massive infrastructure initiatives around the world with its Belt and Road Initiative.

So let's get real. The US has one model among many models. The US itself is a hybrid of capitalism and socialism. That great socialist Dwight Eisenhauer used government taxpayer money to build the US interstate highway system. Medicare and Social Security are socialist systems. So is the public education system funded by taxpayer money. So is the Post Office although Trump and the Republicans are doing their best to get rid of any vestige of socialism including the Post Office in the US.

Maybe it would make better sense to pose the question "what hybrid of capitalism and socialism works the best?" This would entail a comparative study of the societal systems of other countries and an acknowledgement of what is working and what is not working in their countries and our own country. Instead the Republican party is intent on demonizing labels contained in the mindset and paradigm of the 1950s and trying to pin them on to the Democratic Party. What they really stand for is the US as it was when white supremacy and the WPP was the order the day. It's not reality in today's world.

Off the Top of My Head

A House Built Upon Sand: the US Economy

by John Lawrence, June 26, 2020

The wise man built his house on rock, and it withstood the rains and the floods and the wind. The foolish man built his house on sand and it collapsed. An apt metaphor for the US economy in the midst of a pandemic that is only getting worse. Before the pandemic hit, it was a full employment economy in which half the people couldn't survive a $400. emergency. It was an economy built on consumerism. Consumerism was 70% of GDP. About half the economy was small business, but these jobs and this economic activity was vulnerable. Much of it was non-essential. It was bars (by the way you can drink at home); it was restaurants (by the way you can eat at home). It was travel and hospitality (by the way you can sleep at home if you're willing to make your own bed).

The essential parts of the economy continued to operate even when the pandemic hit. It isn't fair that minimum wage workers were more exposed to the coronavirus, but, be that as it may, with some exceptions these workers did not get sick in higher ratios than anyone else. If more of the jobs were essential, productive and less frivolous, there would have been fewer jobs lost and much less unemployment. The economic house was built on sand and when the pandemic hit, it collapsed. At the same time the fault line of black racism and inequality was fully exposed. It's as if the hurricane of the pandemic cut away the underbrush and exposed this situation for what it is thanks to #BlackLivesMatter.

The Homestead Act signed by President Abraham Lincoln which gave free land to white people allowed whites to build equity and wealth while blacks who were promised 40 acres and a mule after slavery were denied even that. They ended up in many cases working the same land as sharecroppers and living in worse poverty than when they were slaves. After World War II the G.I. Bill aimed to help American veterans adjust to civilian life by providing them with benefits including low-cost mortgages, low-interest loans and financial support. African Americans did not benefit nearly as much as White Americans. Historian Ira Katznelson argues that "the law was deliberately designed to accommodate Jim Crow". In the New York and northern New Jersey suburbs 67,000 mortgages were insured by the G.I. Bill, but fewer than 100 were taken out by non-whites.

Additionally, banks and mortgage agencies refused loans to blacks, making the G.I. Bill even less effective for blacks. Once they returned from the war, blacks faced discrimination and poverty, which represented a barrier to harnessing the benefits of the G.I. Bill. So whites were able to build wealth through home ownership while blacks were denied that opportunity. Wealth from home ownership is the difference between the middle class and the poor. Home ownership became the means for the intergenerational transfer of wealth for white people. Each generation of black people started out from zero. There was an intergenerational transfer of poverty instead.

Blacks who were able to get manufacturing jobs after the Second World War did fairly well, but those jobs have by and large fled the country. In the financial crisis of 2008, the Great Recession, blacks were screwed as well. While the Federal Reserve bailed out the banks and mortgage companies hundred cents on the dollar, blacks who needed help paying their mortgages did not get it and were foreclosed on. The government could have bailed them out instead, but it didn't.

So now the country is faced with not only a public health crisis but also an economic, financial and racial crisis which would be much less severe if those manufacturing jobs still existed. The economy is not coming back as it was constructed pre-pandemic. There is no way that small business based on 100% occupancy is going to survive based on 50% occupancy. Many of the businesses like professional sports, cruises and even churches are predicated on high occupancy. People will not be comfortable with high occupancy unless a vaccine is found for COBID, but finding a vaccine is not a foregone conclusion. There are some viruses for which a vaccine has never been found including HIV, malaria and tuberculosis.

It takes a lot of money to develop a vaccine, and that money has been lacking from US budgets. There are two obstacles to faster progress, said Dr. Gregory A. Poland, director of the vaccine research group at the Mayo Clinic. “One is scientific, and one is embarrassing,” he said. The embarrassing part is the lack of investment. It takes 10 years and more than $1 billion to develop a vaccine — a small fortune for a medical advance but a pittance for a weapons system. While defense research is driven by one mega-customer, the Pentagon, vaccine researchers face a confusing hodgepodge of potential backers. In short the US has spent its money on weapons of war instead of protecting its people from pandemics which are far more deadly than terrorist attacks. 405,000 Americans died in WW II. Over half that amount have already died in this pandemic, and it's getting worse due to American foolishness at the top levels.

There is a chance now for America to start out on a new path, and that path would be more or less what Bernie Sanders and other progressives have identified as their agenda: a Green New Deal would create good jobs for millions of unemployed Americans and it could give priority to black people so that they could get started on wealth building. Low cost housing loans and subsidies could give black people the same advantages they didn't get with the Homestead Act and the G.I. bill. At the same time a Green New Deal would be converting the country to renewable energy and rebuilding infrastructure, both of which are necessary if earth is to remain habitable for the human race. Medicare for All would only bring the US up to the level of most other civilized countries.

We have to reset our priorities, reduce the military-industrial complex and make peace and have cooperation with our so-called enemies. We can quibble about Russia's and China's internal affairs or we can cooperate with them as peers to forestall global warming and create a planet worth inhabiting. We can spend our money on war or we can spend it forestalling future pandemics. The solution to many of our myriad problems is clear, and it doesn't require a revolution necessarily. Reform is all that's necessary to implement Medicare for All. Reform is all that's necessary to implement a Green New Deal. But countries that do not do what's necessary and obvious to meet the needs of the people create a situation in which violence may ensue. It's no longer a question of capitalism vs socialism. Most countries of the earth including Russia and China are a combination of both. I started with a Biblical reference so I will end with one: "Blind guides! You strain your water so you won’t accidentally swallow a gnat, but you swallow a camel!" God bless the USA.

Off the Top of My Head

China and India Now Manufacture About 80% of the Drugs Consumed in the U.S.

by John Lawrence, March 29, 2020

The US doesn't even manufacture vital drugs like antibiotics anymore, with the last penicillin factory closing in 2004. But who can blame the drug manufacturers? They're in it for the money. Drugs that you use once or twice and then you're cured are unprofitable. They only manufacture drugs that need to be taken once a day every day for life like high blood pressure and diabetes medicine, and then they outsource the manufacture of those drugs to China because that's the most profitable way to do it. FDA inspectors are unable or unwilling to provide appropriate oversight of Chinese manufacturing. In contrast to the robust testing required for approval for new prescription drugs, the FDA only requires that generic manufacturers prove that patients will absorb drugs at the same rate as the brand-name medications they copy.

But who needs robust drug testing anyway? Ronald Reagan said that the nine most terrifying words in the English language are, "I'm from the government and I'm here to help." So who needs the government's help to test drugs? Who needs government's help in a pandemic? Let's get government off our back and let'er rip. And what we surely don't need is government getting into the business of manufacturing drugs themselves and competing with the private sector. That would be socialism!

Many of the generic drugs imported from China are contaminated. So? Caveat Emptor! China is our great friend when it comes to trusting life saving drugs manufactured there, but our enemy when it comes to government sanctioning and disapprobation. We hate their form of government, but we love that we get Chinese laborers to work for a fraction of what Americans make. China and India are now restricting the export of some drugs and medical equipment. That means that Americans will not have the medical equipment and drugs they need due to export restrictions from countries that have a domestic need for those products. They will come first. The US will be last, but that's capitalism!

Big pharma continues to walk away from investment in new antibiotics and there are alarmingly few useful new drugs in the pipeline to deal with the worsening crisis of antibiotic resistance, according to the World Health Organization. So the US has to depend on another country for most of its pharmaceutical needs while at the same time the President is saying negative things about that country. According to him they are not our ally. Not our ally but we're depending on them for life saving medicines ? Does this make any sense? Of course it makes sense because it maximizes profits for private enterprise.

The US wants to have it both ways. They want to say negative things about the Chinese government while at the same time being almost totally dependent on that country for critical medical products as well as tons of other products. It's all about the fact that American corporations want to take advantage of cheap Chinese labor while at the same time the US government feels free to chastise China. The big pharmaceutical companies are not investing in antibiotic research because it is not a lucrative market for them. And BIG Pharma has successfully gotten government off its back because they made sure that in the Obamacare bill, Medicare could not negotiate with the drug companies for cheaper prescription drugs for old people. Score one for the free market! The law states that the secretary of Health and Human Services “may not interfere” in negotiations between pharmaceutical companies and prescription drug insurance plan providers.

At the same time there is much military swagger on the part of the US. China better watch itself in the South China Sea or we will send our mighty aircraft carriers there. "The head of the U.S. Navy warned China that hostile behavior from its coast guard and fishing boats will not be treated any differently from the Chinese navy, the Financial Times reported on Sunday." But what good is the military going to do if the whole world is at the mercy of a virus or a bacteria, if the whole world is brought to its knees except the countries who have invested in the manufacturing of their own critically needed products? Are we going to invade China and demand that they give us the medicine? Yes, we will send our military to make sure that China does not control the South China Sea, but then get down on our hands and knees to beg China to send us critical medicines that are manufactured there. The whole foreign policy regarding China is absolutely nuts.

Agribusiness continues to use antibiotics in animal feed not for the treatment or prevention of disease, but to make them attain higher marketable weights in the quickest possible time. This make more profit for the meat growers and slaughterers. At the same time it decreases the medicinal benefits of antibiotics in humans because the bacteria mutate at a faster rate. Therefore, new antibiotics must be developed, but they aren't being developed. The lucrative drugs are the ones that must be taken every day for life not the ones that, once they have cured a disease, are no longer needed. But we don't want to regulate Agribusiness, do we? We want fewer government regulations because we want to get government off our backs or at least off the backs of private enterprise so they can maximize profits.

For the US to be secure against disease the Federal government must develop the drugs and antibiotics that the pharmaceutical corporations are not developing because they are unprofitable. We can't totally rely on the private sector because the private sector is only in it for the money not for the health of the nation. In a pandemic Reagan's words, "I'm from the government and I'm here to help" are not the most terrifying words in the English language. They're the most reassuring words.

Socialism at Its Finest after Fed’s Bazooka Fails

Posted on March 21, 2020 by Ellen Brown

Web of Debt blog

In what is being called the worst financial crisis since 1929, the US stock market has lost a third of its value in the space of a month, wiping out all of its gains of the last three years. When the Federal Reserve tried to ride to the rescue, it only succeeded in making matters worse. The government then pulled out all the stops. To our staunchly capitalist leaders, socialism is suddenly looking good.  

The financial crisis began in late February, when the World Health Organization announced that it was time to prepare for a global pandemic. The Russia-Saudi oil price war added fuel to the flames, causing all three Wall Street indices to fall more than 7 percent on March 9. It was called Black Monday, the worst drop since the Great Recession in 2008; but it would get worse. 

On March 12, the Fed announced new capital injections totaling an unprecedented $1.5 trillion in the repo market, where banks now borrow to stay afloat. The market responded by driving stocks 8% lower.

On Sunday, March 15, the Fed emptied its bazooka by lowering the fed funds rate nearly to zero and announcing that it would be purchasing $700 billion in assets, including federal securities of all maturities, restarting its quantitative easing program. It also eliminated bank reserve requirements and slashed Interest on Excess Reserves (the interest it pays to banks for parking their cash at the Fed) to 0.10%. The result was to cause the stock market to open on Monday nearly 10% lower. Rather than projecting confidence, the Fed’s measures were generating panic.

As financial analyst George Gammon observes, the Fed’s massive $1.5 trillion in expanded repo operations had few takers. Why? He says the shortage in the repo market was not in “liquidity” (money available to lend) but in “pristine collateral” (the securities that must be put up for the loans). Pristine collateral consists mainly of short-term Treasury bills. The Fed can inject as much liquidity as it likes, but it cannot create T-bills, something only the Treasury can do. That means the government (which is already $23 trillion in debt) must add yet more debt to its balance sheet in order to rescue the repo market that now funds the banks.

The Fed’s tools alone are obviously incapable of stemming the bloodletting from the forced shutdown of businesses across the country. Fed chair Jerome Powell admitted as much at his March 15 press conference, stating, “[W]e don’t have the tools to reach individuals and particularly small businesses and other businesses and people who may be out of work …. We do think fiscal response is critical.” “Fiscal policy” means the administration and Congress must step up to the plate.

What about using the Fed’s “nuclear option” – a “helicopter drop” of money to support people directly? A March 16 article in Axios quoted former Fed senior economist Claudia Sahm:

The political ramifications of the Fed essentially printing money and giving it to people – there are ways to do it, but the problem is if the Fed does this and Congress still has not passed anything … that would mean the Fed has stepped in and done something that Congress didn’t want to do. If they did helicopter money without congressional approval, Congress could, and rightly so, end the Fed.

The government must act first, before the Fed can use its money-printing machine to benefit the people and the economy directly.

The Fed, Congress and the Administration Need to Work as a Team 

On March 13, President Trump did act, declaring a national emergency that opened access to as much as $50 billion “for states and territories and localities in our shared fight against this disease.” The Dow Jones Industrial Average responded by ending the day up nearly 2,000 points, or 9.4 percent.

The same day, Democratic presidential candidate Rep. Tulsi Gabbard proposed a universal basic income of $1,000 per month for every American for the duration of the crisis. She said, “Too much attention has been focused here in Washington on bailing out Wall Street banks and corporate industries as people are making the same old tired argument of how trickle-down economics will eventually help the American people.” Meanwhile the American taxpayer “gets left holding the bag, struggling and getting no help during a time of crisis.” H.R. 897, her bill for an emergency UBI, she said was the most simple, direct form of assistance to help weather the storm.

Democratic presidential candidate Andrew Yang, who made a universal basic income the basis of his platform, would go further and continue the monthly payments after the coronavirus threat was over.

CNBC financial analyst Jim Cramer also had expansive ideas. He said on March 12:

How about a $500 billion Treasury issue … [at] almost no interest cost, to make sure that when people are sick they don’t have to go to work, and companies that are in trouble because of that can still make their payroll. How about a credit line backstopped by … the Federal Reserve. I know the Federal Reserve is going to say they can’t do that, Congress is going to say they can’t do that, everyone is going to say what they said in 2007, they can’t do that, they can’t do that — until they did it. … [W]e heard all that in 2007 and they ended up doing everything.

And that looks like what will happen this time around. On March 18, as the stock market continued to plummet, the administration released an outline for a $1 trillion stimulus bill, including $500 billion in direct payments to Americans, along with bailouts and loans for the airline industry, small businesses, and other “critical” sectors of the U.S. economy.

But the details needed to be hammered out, and even that whopping package buoyed the markets only briefly. In the bond market, yields shot up and values went down, on fears that the flood of government bonds needed to finance this giant stimulus would cause bond values to plummet and the government’s funding costs to shoot up.

Extraordinary Measures for Extraordinary Times

There is a way around that problem. To avoid driving the federal debt into the stratosphere, the Treasury could borrow directly from the central bank interest-free, with an agreement that the debt would remain on the Fed’s books indefinitely. That approach has been tested in Japan, where it has not generated price inflation as austerity hawks have insisted it would. The Bank of Japan has purchased nearly 50 percent of the government’s debt, yet consumer price inflation remains below the BOJ’s 2 percent target.

Virtually all money today is simply “monetized” debt – debt turned by banks into something that can be spent in the marketplace – and the ultimate backstop for this sleight of hand is the central bank and the government, which means the taxpayers. To equalize our very unequal system, the central bank and the government need to work together. The Fed needs to be “de-privatized” – turned into a public utility that serves the taxpayers and the economy. As Eric Striker observed in The Unz Review on March 13:

The US government’s lack of direct control over the nation’s central bank and the plutocratic nature of our weak state means that common sense solutions are off the table. Why doesn’t the state buy up majority shares in large corporations (or outright nationalize them, as happened with the short successful experiment with General Motors in 2009) and use the $1.5 trillion at low interest to develop American industrial independence?

Interestingly, that too could be on the table in these extraordinary times. Bloomberg reported on March 19 that Larry Kudlow, the White House’s top economic adviser, says the administration may ask for an equity stake (an ownership interest) in corporations that want coronavirus aid from taxpayers. Kudlow noted that when this was done with General Motors in 2008, it turned out to be a good deal for the federal government.

While traditionally considered “anti-capitalist,” the government taking an ownership interest in bailed out companies may be the only way the proposed bailouts will get approval. There is little sentiment today for the sort of no-strings-attached “socialism for the rich” that the taxpayers shouldered in 2008 without reaping the benefits. Bloomberg quotes Jeffrey Gundlach, chief executive officer at DoubleLine Capital:

I don’t think government bailouts of over-leveraged companies that got over-leveraged by share buybacks at all-time highs, enriching executives and hedge fund investors, will sit well with the American people.

The Bloomberg article concludes with a quote from another chief investment officer, Chris Zaccarelli of Independent Advisor Alliance:

I like how [the administration is] thinking a little bit outside of the box. Something big and bold like that could potentially be what turns the market around ….

Long-term Solutions

Rather than just a stake in the profits, the government could think a bit further outside the box and turn insolvent airlines, oil companies, and banks into public utilities. It could require them to serve the people and the economy rather than just maximizing the short-term profits of their shareholders.

Concerning the banks, the Fed could do as the People’s Bank of China is doing in this crisis. The state-run PBoC is giving regional banks $79 billion in stimulus money, but it is on condition that they lend it to small and medium enterprises and forgive late payments, so that economic damage is reversed and production can recover quickly.

Another model worth studying is that of Germany, which also has a strong public banking system. As part of a package for coronavirus aid that the German finance minister calls its “big bazooka,” the government is offering immediate access to loans up to €500,000 for small businesses through its public bank, the KfW (Kreditanstalt fuer Wiederaufbau), administered through the publicly-owned Sparkassen and other local banks. The loans are being made available at an interest rate as low as 1%, with interest only for the first two years.

Contrast that to the aid package President Trump announced last week, which will authorize the Small Business Administration to offer business loans. After a lengthy process of approval by state authorities, the loans can be obtained at an interest rate of 3.75% – nearly 4 times the KfW rate. German and Chinese public banks are able to offer rock-bottom interest rates because they have cut out private middlemen and are not driven by the insatiable demand for shareholder profits. They can lend countercyclically to avoid booms and busts while supporting the economy as a whole.

The U.S., too, could create a network of publicly-owned banks backed by the central bank, which could lend into their communities at below-market rates. And this is the time to do it. Times of crisis are when change happens. When the Covid-19 scare has passed, we will have a different government, a different economy and a different financial system. We need to make sure that what we get is an upgrade that works for everyone.

_______________________

Ellen Brown chairs the Public Banking Institute and has written thirteen books, including her latest, Banking on the People: Democratizing Money in the Digital Age.  She also co-hosts a radio program on PRN.FM called “It’s Our Money.” Her 300+ blog articles are posted at EllenBrown.com.

Media Malfunction as Sanders Notes Positive Aspects of Latin American Socialism

Published on Sunday, March 08, 2020

by Fairness and Accuracy In Reporting (FAIR)

A far more urgent task for reporters covering the U.S. election cycle would be asking candidates how they plan to combat U.S. authoritarianism at home and abroad, and questioning why the accomplishments of Latin American socialism aren't possible in the United States.

by Gregory Shupak

 

8 Comments

Slate published a photo illustration for the article "Sanders Has a Soft Spot for Latin American Strongmen" on Feb. 20, 2019. (Image: Slate/Photos: Mandel Ngan/AFP/Getty Images, Alex Wong/Getty Images, Federico Parra/AFP/Getty Images, and Sven Creutzmann/Mambo Photography/Getty Images)

When 60 Minutes (2/24/20) asked Sen. Bernie Sanders about his past support for aspects of Cuba's socialist revolution, as well as for Nicaragua's 1979–90 leftist Sandinista government, Sanders responded by saying he opposes what he described as the "authoritarian" features of the Cuban government, while noting that after the 1959 revolution, Cuba launched "a massive literacy program. Is that a bad thing?"

News organizations seemed unable to process that a major national political figure could say something positive about a socialist country, leaving these outlets flailing around in absurd ways.

NBC (2/21/20) worried that Bernie Sanders' "affinity for revolutionary movements" might mean that the "number of targeted killings of terror suspects would fall if he were president."

During a town hall, CNN's Chris Cuomo (2/24/20) asked Sanders to respond to "the Democrats who say you don't say good things about Fidel Castro, he destroyed freedoms in that country." The revolution did not "destroy freedoms" in Cuba: The ruler it overthrew, Fulgencio Batista, ran what the U.S. Library of Congress (4/01) called a "corrupt and brutal dictatorship," under whose rule there were 20,000 political killings.

In the New York Times (2/27/20), David Brooks criticized Sanders because he "excused the Nicaraguan communists when they took away the civil liberties of their citizens." Yet there were few "civil liberties" for the Sandinistas—the "Nicaraguan communists" to whom Brooks refers—to take away. The Somoza dictatorship, which the Sandinistas overthrew in a popular revolution, was one of "chronic repression" (New York Times, 2/26/78). According to the Latin American Studies Association (LASA) (11/19/84), Somoza left the country with "no democratic tradition," instead bequeathing a legacy of "militarized politics with rampant human rights violations," so that the 1984 election that the Sandinistas held—and won fairly, according to the British observer—was the "first experience with participatory democracy" for most Nicaraguans.

Even before the current Cuba kerfuffle, NBC (2/21/20) criticized Sanders because "he denounced what he called a 'coup' against Bolivia's leftist president, Evo Morales, despite findings by independent groups that Morales tried to steal an election." Less than a week later, the Washington Post (2/27/20) published a report from researchers at the MIT Election Data and Science Lab, saying, "As specialists in election integrity, we find that the statistical evidence does not support the claim of fraud in Bolivia's October election." The report bolsters critiques that were made immediately after the (yes) coup (FAIR.org, 11/18/19) that there was no compelling evidence that Morales tried to steal the election. The "independent group" cited in the article the Post linked to, notably, gets 60% of its funding from the U.S.government.

Forced to broadcast qualified praise for some elements of Latin American socialism, several outlets took refuge in the most over-the-top rhetoric imaginable. MSNBC's Joe Scarborough (2/25/20), for example, listed the Sandinistas and Cuba's revolutionary government as being "some of the most murderous regimes in the history of our planet."

The "murderous" Sandinistas conducted "sanitation campaigns, health education, occupational health and safety, and nutrition programs" that LASA found to "have significantly reduced the incidence of communicable diseases, malnutrition and infant mortality." LASA went on to say that

even though real money wages have not risen appreciably, access to government-subsidized foodstuffs and other products through the basic-commodity rationing system has helped to raise living standards for the bulk of the population.

In Cuba, before 1959,"the greater part of the population had access only to... underfunded, low-quality, public healthcare services," reported the International Journal of Health Services (2/05); "in rural areas, many people had never seen a doctor." By 1975, there were "56 rural hospitals and numerous rural medical posts" (Library of Congress, 4/01). It went on to create a health system that, according to the World Health Organization (5/08), is "by many standards one of the world's most effective." According to the CIA World Fact Book, Cuba has a lower rate of infant mortality than the United States.

The Nicaraguan and Cuban socialists evidently decided that the best way to murder people was to make them healthier.

The Times' Brooks said that "every day we find more old quotes from Sanders apologizing for" a "slave regime" such as "Cuba or Nicaragua." What Brooks called a "slave regime" in Nicaragua was characterized by, as LASA documented, agrarian reform that involved nationalizing the extensive landholdings of the Somoza family and some of its associates, giving nearly two-thirds of these to individual peasants and some 15% to cooperatives, moves that help explain why these campesinos were "staunch supporters of the government"; the remainder of the nationalized land went to government-owned firms, where workers "enjoy[ed] mechanisms for participation in the management of such enterprises." Brooks did not explain how redistributing land to the poor is akin to owning humans as chattel.

The Sandinistas also carried out a mass literacy campaign that won Nicaragua two awards from UNESCO, which said of the educational initiative:

The illiteracy rate was brought down in five months from 50% to 12%. The National Literacy Crusade is the greatest educational and cultural achievement in the history of Nicaragua. It was a major experience for the young from the cities who taught people to read and, at the same time, discovered the other half of the country with its conditions of neglect and poverty bequeathed by 50 years of dictatorship.

With its massive, participatory and united character, the Crusade became a unique national and international experiment that won the recognition of UNESCO.

As for the "slave regime" in revolutionary Cuba, the United Nations Development Programme (UNDP) places the country in the "high human development" category. This refers to the Human Development Index, which aggregates key benchmarks for health, longevity, knowledge and standard of living. The UNDP says Cuba is above average for the countries in the high human development group, and above average for countries in Latin America and the Caribbean.

A 2016 University of Chicago study of public opinion inside Cuba asked respondents "about how things are going in their life in general"; 57% said they were very or somewhat happy, while 11% said they were somewhat or very unhappy. Cubans were also asked, "Generally speaking, would you say that things in [Cuba] are headed in the right direction or the wrong direction?"; 53% said right and 36% said wrong.

Bernie Sanders "rankles so many Latinos" (Washington Post, 2/25/20) that he got more than half their votes in California and almost half in Texas (Washington Post, 3/4/20).

Not to be outdone by Brooks' slavery analogy, Francisco Toro of the Washington Post (2/25/20) said of Sanders' identification as a democratic socialist:

The bottom line is that when you associate yourself with an ideology whose past contains some of history's worst crimes, you take on a special duty to denounce. When those denunciations come hedged with qualifiers that rest on propaganda lines, they ring entirely hollow.

Germans get this. Angela Merkel's party, the conservative Christian Democratic Union, always understood that if you're going to stand even half an inch to the right of center in the country that Hitler once ran, you must go to very great lengths to put distance between yourself and anything even vaguely reminiscent of Nazism. Which is one reason the center-right in Germany is one of the most doggedly pro-democracy forces in Europe.

Sanders needs to understand he's in a similar position.

To suggest that the Cuban government is as bad as the Nazis is, of course, to say the Nazis were no worse than Cuba—a creepy position in any case, but particularly offensive in a critique of a politician whose family was largely wiped out in the Holocaust.

There are no documented cases of Cuba carrying out the death penalty since 2003, and nobody in the country is known to be facing a death sentence. Forget Hitler: The United States has executed 328 people since 2010—22 last year and four in just the first two months of this year—while 2,654 people are currently on death row in the United States.

Toro's piece focuses on his concern that Sanders is apparently "parrot[ing] Fidel's propaganda." That's an interesting choice of word, because Toro is a professional propagandist: He is the "chief content officer of the Group of 50," an outfit with a vested interest in promoting capitalism and discrediting socialism in any form; the organization describes itself as "composed of a select group of business leaders" and

a top forum for Latin America's most influential business leaders to explore the latest trends in world affairs as well as an opportunity for them to hear from their peers in other countries and industries.

The Group of 50 has partnerships with the plutocratic World Economic Forum and with the Inter-American Development Bank, which the U.S.dominates, and which the Intercept(4/18/19) found to be circulating a plan to infuse Cuba's crucial Venezuelan ally with $48 billion in capital, but only following the hoped-for U.S.-backed overthrow of Venezuela's government.

Being part of such networks goes a long way to explaining how one ends up claiming there are parallels between Cuba and Nazi Germany.

James Freeman (Wall Street Journal, 2/24/20) devotes an entire column to asserting that Bernie Sanders has "a long history of support for the most undemocratic of socialists"—without bothering to dig up any quotes to document that claim.

Not that Toro's assertions are unique. Bret Stephens of the New York Times (2/28/20) suggested that Cuba and the Sandinistas are among "the vilest regimes in history." The Wall Street Journal's James Freeman (2/24/20) denounced Sanders' praise for "tyrants" and "brutal regimes," or, as Casey Michel said of Cuba in the New Republic (2/25/20), "enduring despotism." Incarceration rates are a standard measure of tyranny, brutality and despotism, and it happens that the U.S. has more people in jail per capita than any other country: 655 per 100,000 for the U.S., 510 for Cuba, and 332 for the present incarnation of the Sandinistas, just over half of the figure for the U.S.

The New Republic's Michel also lent ideological cover to 60 years of often violent U.S. attacks on Cuba, alleging—in part on the basis of an unproven, extremely dubious claim that $900 million of Cuba's national wealth was Fidel Castro's personal ATM—that Cuban government policies "have immiserated an entire island," supposedly turning the country into "an economic basket case." Jaw-droppingly, he did so without mentioning the U.S.'s economic blockade that, according to the U.N., has cost Cuba $130 billion.

U.S. violence against Cuba, economic and otherwise, brings us to another important consideration for assessing who are "some of the most murderous regimes in the history of our planet" or "some of the vilest regimes in history," or who exhibits the "blood-soaked brutalism" that Michel ascribed to Cuba: how states conduct themselves outside of their borders. To cite only a few grotesque examples, the United States visited the horrors of the Earth upon Indochina; was behind the deaths of hundreds of thousands as it prosecuted a vicious war against the Sandinistas and other liberation movements in Central America; caused the deaths of up to a million in Iraq (FAIR.org, 2/21/20); and is currently helping starve Yemen while levying sanctions against Iran that are enabling the spread of coronavirus in the country. Cuba, by contrast, played a crucial role in liberating multiple African countries, while sending doctors and teachers around the world to help many of the planet's least well-off.

Rather than denouncing Bernie Sanders for noting the accomplishments of Latin American socialists whom the American media deems too authoritarian, a far more urgent task for reporters covering the U.S. election cycle would be asking candidates how they plan to combat U.S. authoritarianism at home and abroad, and questioning why the accomplishments of Latin American socialism aren't possible in the United States.

Gregory Shupak teaches media studies at the University of Guelph-Humber in Toronto. His book, The Wrong Story: Palestine, Israel and the Media, is published by OR Books.

© 2020 Fairness and Accuracy In Reporting (FAIR)

Off the Top of My Head

How Come Democratic Socialism Works So Well in Scandinavia?

by John Lawrence, March 2, 2020

Bernie Sanders is being blasted by the old bugaboo of capitalism vs communism. This is a pitched battle which is so 20th century. The reality today is that what we have in the US and around the world is neoliberism, a virulent form of capitalism which is "an account of human nature where economic competition is the highest value [which] leads to a political theology where the prime duty of the state is to enable, and indeed mandate, such competition, and the result is a world wherein individuals, firms, and states are all continually constrained to express themselves via economic competition." Neoliberalism is a system in which "more and more people — especially young people who were born and raised in the neoliberal era — have started to question a system that has left their generation drowning in debt, burned out and mentally exhausted, and stuck in an endless loop of precarious uncertainty."

So what is democratic socialism? It is widely practiced in the Nordic countries of Sweden, Denmark, Finland and Norway. Currently, the Nordic countries are described as being highly democratic and all have a unicameral form of governance which use proportional representation in their electoral systems. There is  support for a universalist welfare state aimed specifically at enhancing individual autonomy and promoting social mobility; a corporatist system involving a tripartite arrangement where representatives of labor and employers negotiate wages and labor market policy mediated by the government; and a commitment to private ownership within a mixed economy.

Far from discouraging entrepreneurialism, these countries are hotbeds of it. The Scandinavian countries of Norway, Sweden and Denmark are regularly ranked among the best places in the world to start a new business despite their high-tax environments. Well known businesses Spotify, Just Eat and airline Norwegian have all emerged from this part of the world to international success. Somehow, these small, Northern European nations have managed to pursue large income redistribution without disincentivising hard work and corporate invention.

So there you have it. Democratic socialist countries are arguably more democratic than is the US and countries modeled after it due to its unicameral legislative branch based on proportional representation as opposed to the winner take all two party system in the US. There is a spirit of comaraderie and cooperation instead of a spirit of solipsistic competition. A spirit that "we're all in this together." There is more social mobility than in the US. Harvard professor Raj Chetty proclaimed:"If you were an immigrant choosing where to go and have the best chances of climbing the income ladder, then statistically you’d have a better shot of achieving ‘the American dream’ if you’re growing up in Canada or in many Scandinavian countries than the United States." In addition you would have universal health care and free college education. Pretty much many of the elements Bernie Sanders advocates.

Many of the elements of democracy and common purpose that the US was originally founded on are better exemplified in other socialist democratic countries than they are in the present day neoliberalist US. Conor Lynch writes:

Neoliberalism is the opposite of solidarity. It encourages an extreme form of selfish individualism that ends up depoliticizing the populace and eroding the collective spirit of democracy. It also leaves the individual isolated and alone. “In a brutal, competitive, and atomized society, psychic well-being is so difficult that success on this front can feel like a significant accomplishment,” observes political theorist Jodi Dean. “Trying to do it themselves, people are immiserated and proletarianized and confront this immiseration and proletarianization alone.”

No wonder so many young people who are drowning in student loan debt and lack of medical care, not to mention a government not the least bit concerned about global warming, are finding inspiration in a more egalitarian system of government in which more entrepreneurial activity is taking place and more upward mobility is being realized than in the United States of America. The real debate is not between authoritarian socialism and capitalism; it's between democratic socialism and neoliberalism. What kind of a world do you want to live in?

Off the Top of My Head

The American Dream Better Realized in Democratic Socialist Denmark

by John Lawrence, February 20, 2020

In the other night's Democratic debate Pete Buttigieg mentioned that the American Dream is alive and well ... wait for it ...  in Denmark. As for America itself, there are 10 other countries in which it's easier to realize the American Dream which is that the children "do better" than their parents. "Doing better" has the dubious meaning of having more money. Leaving aside the fact that there are other dimensions to "doing better", America seems to be falling behind other nations when it comes to children starting low and achieving high. Democratic socialist Bernie Sanders should have jumped on this as he's often put down as a democratic socialist. But, heck, if the American Dream is more easily achievable in a democratically socialist country like Denmark, this sort of makes Bernie's case, doesn't it?. By the way they have universal health care as a human right and free college education which are things that Bernie never fails to mention as a part of his debate spiel.

In an article in Politifact Steven Rattner said: "The United States is behind many countries in Europe in terms of the ability of every kid in America to get ahead." The article went on:

Families at all earning levels were growing together after World War II but have been growing apart since in the decades since, Krueger wrote. The country’s top earners have pulled a lot further ahead than the middle and lower class, he said, and the trend line suggests the future earnings of today’s children will be tied more and more to the income level of their parents.

"Not since the Roaring 20s has the share of income going to the very top reached such high levels," Krueger said, according to prepared remarks.

Krueger compared income inequality of 10 developed countries with the correlation between a parent’s income and their children’s (it’s more complicated than we described, check out the details in Krueger’s presentation or this Bloomberg infographic). The "Gatsby Curve" showed economic possibilities for children in European countries such as Finland, Norway, Denmark, Sweden, Germany and France were much less connected to their parents’ income than in the United States and United Kingdom.

MarketWatch reported in an article entitled Sorry America, Norway ranks No. 1 for ‘life, liberty and the pursuit of happiness’:

The U.S. doesn’t rank among the Top 10 on a list of 155 countries

In fact, Norway ranked No. 1 for happiness and personal freedom, according to an analysis of three separate studies on life expectancy by the World Bank, on civil liberties from Freedom House, a New York-based nonprofit that conducts research on advocacy and democracy, on happiness from the Sustainable Development Solutions Network (SDSN), a group linked to the United Nations, and on rule of law from the World Justice Project, a Washington, D.C.-based nonprofit.

The analysis was released by information-analytics firm LexisNexis [which] found that countries that have established a strong rule of law have significantly more success in securing measures of life, liberty and happiness for their citizens. Sweden ranked No. 2 and Canada was No. 3, followed by Australia, the Netherlands, Finland and Austria. The U.S. ranked No. 19 just behind the Czech Republic, Japan and France. Afghanistan ranked last at No. 98.

Norway ranked No. 1 for happiness, the U.S. was No. 14

Norway was also No. 1 out of 155 countries on the 2017 “World Happiness Report,” up from No. 4 the year before, followed by Denmark (last year’s No. 1), Iceland and Switzerland. The U.S. was trailing at No. 14. These four countries rank highly on all the main factors found to support happiness: caring, freedom, generosity, honesty, health, income and good governance. “Their averages are so close that small changes can re-order the rankings from year to year,” the report said.

These kinds of reports should add fuel to the fire of Bernie Sanders' message that not only do people in these countries have a better chance of attaining the American Dream, these countries are socialist democracies which guarantee health care as a human right and offer free college education. No one in these countries has any student loan debt.

Not only that but, whereas the US is $20 trillion in national debt, Norway has a sovereign wealth fund.  It has over $1 trillion dollars in assets, including 1.4% of global stocks and shares, making it the world’s largest sovereign wealth fund. In May 2018 it was worth about $195,000 per Norwegian citizen. It also holds portfolios of real estate and fixed-income investments. Many companies are excluded by the fund on ethical grounds.

Bernie Sanders should have driven Pete Buttigieg's point home. Now only are democratic socialist countries better off in terms of education and health care, they are also better off in terms of the wealth they own, a far cry from a debtor nation like the US that spends all its money on military adventurism. Each man, woman and child in America is responsible for $61,124.69 of that debt. The denouement is clear: US citizens are net debtors in terms of the national debt. Norwegian citizens are net creditors.

Bernie Sanders' Radical New Proposal Could Transform America

Michael Nigro / Truthdig

by Marjorie Cohn, truthdig, June 16, 2019

Presidential candidate Bernie Sanders delivered a full-throated defense of democratic socialism in his June 12 speech at George Washington University. Sanders quoted FDR’s 1944 State of the Union address: “We have come to a clear realization of the fact that true individual freedom cannot exist without economic security and independence.”

Sanders, like FDR, proposed an Economic Bill of Rights, including the rights to health care, affordable housing, education, a living wage and retirement.

“Economic rights are human rights,” Sanders declared. “That is what I mean by democratic socialism.”

Sanders cited figures of vast wealth disparity in the United States, where “the top 1 percent of people own more wealth than the bottom 92 percent.” He said there is higher income and wealth inequality today than at any time since the 1920s. And, Sanders stated, “despite an explosion in technology and worker productivity, the average wage of the American worker in real dollars is no higher than it was 46 years ago and millions of people are forced to work two or three jobs just to survive.”

He also noted, “in America today, the very rich live on average 15 years longer than the poorest Americans.”

Economic Rights Are Human Rights

The Universal Declaration of Human Rights sets forth two different categories of human rights: (1) civil and political rights, and (2) economic, social and cultural rights.

Civil and political rights comprise the rights to life, a fair trial and self-determination; freedom of speech, expression, assembly and religion; and freedom from torture, cruel treatment and arbitrary detention. Economic, social and cultural rights include the rights to health care, education and social security; the right to form and join unions and to strike; and the right to equal pay for equal work, unemployment insurance, paid maternity leave, and the prevention, treatment and control of diseases.

These two types of human rights are enshrined in two international treaties — the International Covenant on Civil and Political Rights (ICCPR) and the International Covenant on Economic, Social and Cultural Rights (ICESCR).

The United States has ratified the ICCPR, but not the ICESCR. U.S. policy since the Reagan administration has been to define human rights only as civil and political rights, excluding economic, social and cultural rights from the realm of human rights.

The ICESCR, which has been ratified by 169 countries, guarantees the rights to work with favorable conditions, to the highest attainable standards of physical and mental health, to education, to housing, to an adequate standard of living, and to enjoy the benefits of scientific progress and cultural freedom. It protects the rights to form and join trade unions, social security and social insurance, equal rights for men and women, and protection and assistance to the family.

Cuba, whose human rights record is frequently criticized by the U.S. government, puts the United States to shame with its recognition of economic rights. Cubans enjoy universal health care, universal free education including higher education, the right to form and join unions, and government-subsidized abortion and family planning. Cuba has a higher life expectancy than the U.S., as well as a relatively small ecological footprint due to low energy consumption.

Democratic Socialism vs. Corporate Socialism

Trump and his fellow oligarchs oppose democratic socialism, Sanders said, but “they don’t really oppose all forms of socialism.” Indeed, “they absolutely love corporate socialism that enriches Trump and other billionaires.”

Sanders cited the $700 billion bailout of Wall Street in 2008 by the Treasury Department “after their greed, recklessness and illegal behavior created the worst financial disaster since the Great Depression — with millions of Americans losing their jobs, their homes and their life savings — Wall Street’s religious adherence to unfettered capitalism suddenly came to an end.”

He also mentioned tax breaks and loopholes for fossil fuel companies, pharmaceutical companies, Amazon, and the Trump family who “got $885 million worth of tax breaks and subsidies for your family’s housing empire that is built on racial discrimination.”

As Dr. King observed, the United States “has socialism for the rich, rugged individualism for the poor.”

Embracing Socialism Is a Winning Strategy

Sanders noted that FDR and his progressive coalition were successful, and their legacies continue to flourish in programs and protections like Social Security, regulation of Wall Street and unemployment compensation. He pointed out that Roosevelt aimed to go further.

“In 1944, FDR proposed an economic bill of rights but died a year later and was never able to fulfill that vision. Our job, 75 years later,” Sanders said, “is to complete what Roosevelt started.”

He then set forth his vision of a 21st Century Economic Bill of Rights, which would recognize that all Americans should have:

• The right to a decent job that pays a living wage
• The right to quality health care
• The right to a complete education
• The right to affordable housing
• The right to a clean environment
• The right to a secure retirement

Sanders listed Democratic presidents vilified by the oligarchs of their time for their programs of alleged “socialism.” Lyndon Johnson was attacked for Medicare, Harry Truman’s proposed national health care program was dubbed “socialized medicine,” and Newt Gingrich called Bill Clinton’s health care plan “centralized bureaucratic socialism.”

Although none of the other leading 2020 Democratic presidential candidates has embraced socialism, the party’s base has. Candidate John Hickenlooper, former governor of Colorado, was roundly booed at the California Democratic convention earlier this month when he said, “If we want to beat Donald Trump and achieve big progressive goals, socialism is not the answer.”

Indeed, Thomas Piketty, author of Capital in the Twenty-First Century, argues, “Without a strong egalitarian-internationalist platform, it is difficult to unite low-education, low-income voters from all origins within the same coalition and to deliver a reduction in inequality.”

Keith A. Spencer, writing at Salon, cites Piketty for the proposition that “nominating centrist Democrats who don’t speak to class issues will result in a great swathe of voters simply not voting.”

Moreover, a 2018 Gallup poll determined that a majority of young Americans have a positive opinion of socialism. According to a recent Axios poll, 55 percent of women ages of 18 to 54 would prefer to live in a socialist country.

Sanders said the U.S. and the rest of the world face two different political paths. “On one hand,” he noted, “there is a growing movement towards oligarchy and authoritarianism in which a small number of incredibly wealthy and powerful billionaires own and control a significant part of the economy and exert enormous influence over the political life of our country. On the other hand, in opposition to oligarchy, there is a movement of working people and young people who, in ever increasing numbers, are fighting for justice.”

After his speech, Sanders told CNN’s Anderson Cooper, that real change is generated by mass movements. He cited the civil rights movement, the women’s movement, the gay movement and the labor movement.

“It is time for the American people to stand up and fight for their right to freedom, human dignity and security,” Sanders affirmed. “This is the core of what my politics is all about.” He clarified, “the only way we achieve these goals is through a political revolution.”

The Same Old Scare Tactic about Socialism

by Robert Reich

Thursday, June 6, 2019

I keep hearing a lot about “socialism” these days, mainly from Donald Trump and Fox News, trying to scare Americans about initiatives like Medicare for All, a Green New Deal, universal child care, free public higher education, and higher taxes on the super-wealthy to pay for these. 

Well, I’m here to ask you to ignore the scaremongering.

First, these initiatives are overwhelmingly supported by most Americans.

Second, for the last 85 years, conservative Republicans have been yelling “socialism” at every initiative designed to help most Americans. 

It was the scare word used by the Liberty League, in 1935 when President Franklin D. Roosevelt proposed Social Security.

In 1952, President Harry Truman noted that “Socialism is the epithet they have hurled at every advance the people have made in the last 20 years….” 

Truman went on to say,“Socialism is what they called public power…social security… bank deposit insurance. ..free and independent labor organizations.,, anything that helps all the people. Truman concluded by noting “When the Republican candidate inscribes the slogan ‘Down With Socialism’ … what he really means is, ‘Down with Progress.’”

Third, if we don’t want to live in a survival-of-the-fittest society in which only the richest and most powerful can endure, government has to do three basic things: regulate corporations, provide social insurance against unforeseen hardships, and support public investments such as schools and public transportation.

All of these require that we pool our resources for the common good.

Regardless of whether this is called democratic socialism or enlightened capitalism, all are necessary for a decent society.

Fourth and finally, America spends very little on social programs compared to other industrialized nations. As a result, almost 30 million Americans still lack health insurance, nearly 51 million households can’t afford basic monthly expenses including housing, food, child care, and transportation. And we’re the only industrialized nation without paid family leave. 

Our infrastructure is literally crumbling, our classrooms are overcrowded and our teachers are paid far less than workers in the private sector with comparable education.

We can and must do more. 

So don’t let them scare you with words like “socialism.” These policies are just common sense.

Off the Top of My Head

Working Class: What Working Class?

by John Lawrence, June 7, 2019

Marx's analysis was based on historical determinism - that the working class would rise up against the capitalist class. "Workers of the world arise. You have nothing to lose but your chains." But today there is no working class to speak of. The union movement, which represented the working class, is dead. Everyone is a college graduate, and, therefore, a member of the "professional class." Even assembly line workers have to know hot to run computers, as the video doctor used to say. Republicans created a master stroke when they got everyone - not just capitalists - invested in the stock market through their 401(k)s. Even teachers who have by far and away the largest union are not "workers." They're college graduates and hence "professionals."

There used to be a distinction between "workers" and "professionals." When I worked at General Dynamics, I was sent on a mission that required traveling on Sunday to the east coast. Next to me on the plane was a technician. Since I was a salaried "professional," I was paid nothing extra for traveling on a Sunday. Paul, on the other hand, was a non-college educated "worker" who belonged to the union and was paid by the hour. On this particular occasion Paul was paid double time for "working" on a Sunday while I was paid nothing but my usual "professional" salary. There were other class distinctions also. One of the technicians had a fondness for wearing a coat and tie to work. This was a no-no. Only "professionals" were supposed to wear a coat and tie. Technicians or workers were supposed to come to work in their shirt sleeves. So Carl was looked down on and ridiculed for his impertinence in ignoring class distinctions. Today Apple and Google have changed all that. The CEO comes to work in a hoodie.

After World War II, which we can't get enough of celebrating about, a family could get by very nicely on a one income worker family. There was no student loan debt, a family could have a nice house in Levittown, a car, two weeks vacation a year, send their kids to college, adequate health care, and did I say NO DEBT. The wife could stay home with the kids and bake pies and cakes plus get her hair out of curlers before the man of the house came home from work. Today the average family consists of two earners, massive student loan debt, mortgage debt, car loan debt and credit card debt. Sure they have a 401(k) so technically they are of the capitalist class. They have college degrees so they are "professionals" and not "workers". However, Joe the plumber down the street has most of what they have but no student loan debt because he never went to college. I hired a handyman to hang a door the other day and his charge was $160 for the first hour and $114 for every hour thereafter. Pretty good wages for a nonprofessional. There are several millionaire plumbers in San Diego who advertise on TV. Never went to college. They are probably also landlords whom the "professionals" are paying rent to. Never had a 401(k) though.

Marx's analysis, sadly for dyed in the wool socialists, doesn't apply any more. It's totally out of date. European countries have proved that there is a magic line between socialism and capitalism that, when attained, can bring out the best in both worlds. America's hypercapitalism has only produced massive debt both individually and nationally - the national debt is some $20 trillion and rising daily. Student loan debt is $1.5 trillion. When free money is available, there is a huge appetite for the stuff you can buy with it. When the chickens come home to roost, you're left with a massive debt to repay and the stuff has long been forgotten.

America has led the world to a capitalist utopia where everything except the military is privatized, infrastructure is crumbling (except for the rich who have been able to provide their own infrastructure), massive amounts of debt have been acquired by "professionals" and the nonindebted capitalist class extracts rents and interest from the indebted capitalist class. Everyone is a capitalist, but some capitalists are better off than others. Some are asset rich and some own negative assets. My Grandfather used to say, "Pay what you owe; then you will know what you own." Today nobody pays what they owe in full and, therefore,nobody ever ends up owning anything except debt. Student loan debt can't be discharged in bankruptcy so it follows you around your entire life. It can be discharged by death, however. For those who can't keep up with their payments, the street looms. In this classless society of capitalists, there is still one class - the homeless class. But I don't think even Marx would expect them to rise up and cast off their chains. They are hardly a threat to us capitalists.

Running on Green New Deal and Economic Justice, Socialists Prevail in Spain's Snap Election

Published on Monday, April 29, 2019

by Common Dreams

While the rise of the far-right, xenophobic Vox Party sparked alarm, it performed well below expectations

by Jake Johnson, staff writer

 

6 Comments

Supporters gather outside of the PSOE (Spanish Socialist Workers' Party) headquarters on April 28, 2019 in Madrid, Spain. (Photo: Pablo Blazquez Dominguez/Getty Images)

The Socialist Workers' Party emerged victorious in Spain's snap election on Sunday after running on a platform that included a Green New Deal to combat the climate crisis, a minimum wage increase, and higher taxes on the rich.

"Sánchez came out in support of the U.S. Green New Deal—sometimes translated as 'El New Deal Verde' or 'El Green New Deal de España'—in January and has campaigned on it throughout the election."
—Kate Aronoff, The Intercept

 

With more than 99 percent of the votes counted, the Socialist Party, or PSOE, won 123 of the 350 seats in Parliament. While not enough for an outright majority, the PSOE is now in a position to form a broad left-leaning coalition that would include the anti-austerity Podemos Party.

Speaking to supporters in Madrid following Sunday's election—which also saw the far-right Vox Party enter Parliament—Spanish Prime Minister Pedro Sánchez said the PSOE's win sends "a message to the world that it's possible to win against regression and authoritarianism."

"With that the future has won and the past has lost," said Sánchez at a victory rally.

A better than expected day for the Left in Spain. PSOE win easily according to the exits, Podemos in third only 2 points behind the PP! Looks like a coalition. pic.twitter.com/TImZfPyRUN

— Ronan Burtenshaw (@ronanburtenshaw) April 28, 2019

Decent result for the left of center in Spain. It looks like the specter of the far-right Vox actually drove votes for the Center-left PSOE. The far left Podemos declined a bit but will probably be in a coalition govt with PSOE plus some regional Catalan or Basque parties pic.twitter.com/MWY7liVMp9

— Nando (@nandorvila) April 28, 2019

As The Intercept's Kate Aronoff reported ahead of Sunday's election, "Sánchez came out in support of the U.S. Green New Deal—sometimes translated as 'El New Deal Verde' or 'El Green New Deal de España'—in January and has campaigned on it throughout the election."

"As outlined in the party's recently released 110-point manifesto," Aronoff wrote, "the overall goal of Spain's Green New Deal is an economy-wide mobilization involving participation from local communities, civil society, unions, and businesses, with an industrial policy that treats decarbonization as an engine of job creation."

Teresa Ribera, Spain's minister for ecological transition, told Aronoff that the Green New Deal "accepts that we are in an emergency moment where we need to transform."

"We cannot get as big a transformation as we need without [a] big dose of just transition and solidarity policies," Ribera said. "Otherwise there will be many people who are left behind."

The Labour party is pushing to declare a national emergency on climate change, and PSOE and Podemos in Spain are both running on a Green New Deal. Almost seems like left parties are the only ones taking this crisis seriously https://t.co/qZLgnGyU1l

— Kate Aronoff (@KateAronoff) April 28, 2019

While PSOE strengthened its position in the Spanish government, the rise of the xenophobic, anti-feminist Vox Party sparked alarm in the run-up to country's snap election.

As the New York Times reported, Vox—which won 24 seats in Parliament—"promised not only to quash the secessionist challenge in Catalonia but also to recentralize Spain by removing the powers of its regional governments."

But while acknowledging Vox's surge is certainly cause for serious concern, Washington Post reporter James McAuley noted that the far-right party performed well below expectations.

Don't disagree but would challenge emphasis

Tonight was also a win for Spanish left unafraid to govern as such. Sanchez raised 2019 min wage 22% and won big. And you say Spain never confronted fascist past, but Sanchez is the guy who is literally going to dig up Franco come June https://t.co/QwDUuJeoON

— James McAuley (@jameskmcauley) April 28, 2019

"Vox was supposed to do much better than it did. Its entry into Parliament is clearly huge but really not the story tonight," McAuley tweeted.

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Trump Wants You to Be Afraid of Socialism

by Sonali Kolhatkar, from truthdig, February 22, 2019

Manuel Balce Ceneta / AP

President Donald Trump and the Republican Party are reviving the Red Scare as a central tactic of his 2020 campaign to retain the White House. In Trump’s view, a socialist system is synonymous with poverty and despair, government coercion, domination and control. It is antithetical to liberty and independence. This approach might seem curious, given that interest in socialist ideas is at an-all time high in the United States, as ordinary people react to an out-of-control capitalist system designed to enrich the rich. Trump and his party are betting that good, old-fashioned American individualism will overcome any desire for greater collectivism and more government-funded social programs.

If there is any doubt that this is guiding his path to reelection, Trump’s President’s Day speech on Venezuela is Exhibit A. During his roughly 30-minute address, Trump used the words “socialism,” “socialist,” “communism” or “communist” 36 times—roughly 1.2 times per minute. He echoed simplistic platitudes in an attempt to associate socialism with tyranny (“Socialism is about one thing only: power for the ruling class”). Trump first uttered the words, “Tonight, we renew our resolve that America will never be a socialist country” during his Feb. 5 State of the Union address, receiving wild applause—from both sides of the aisle. He repeated a version of that phrase on Monday:

[T]o those who would try to impose socialism on the United States, we again deliver a very simple message: America will never be a socialist country.

An earlier instance of the Trump White House exploring this strategy can be traced to a document published Oct. 23, 2018, by the White House Council of Economic Advisers, titled, “The Opportunity Costs of Socialism.” The document anxiously refers to how “[d]etailed policy proposals from self-declared socialists are gaining support in Congress and among much of the electorate.” It points out that “[i]n a socialist system, the state decides the amount to be spent, how it is spent, and when and where the services are received by the consumer,” failing to mention that major monopolistic corporations often make such decisions for us in the current system.

The Republican Party has jumped on the anti-socialist bandwagon, fixating mostly on what it says are the enormous costs of progressive government programs (somehow never raising such questions about the bloated military budget), but also expressing horror at how “[f]or the first time in a lifetime, a wave of Democratic candidates are proudly calling themselves socialists.”

I have to admit it is a brilliant strategy. First, in conflating “socialism” with Venezuela, Trump makes the case that the U.S. is justified in rescuing Venezuelans from their government—fulfilling one of his latest foreign policy priorities. Second, demonizing “socialism” enables him and his party to denigrate the new, more progressive members of the Democratic Party who identify as democratic socialists. The GOP’s tactic is aimed at deepening an existing divide within the Democratic Party, which has long claimed progressive ideals but only recently begun to espouse them, thanks to the leadership of such self-described democratic socialists as Alexandria Ocasio-Cortez and Rashida Tlaib. And finally, by denouncing socialism, Trump and the GOP also undermine the socialist-style progressive policy proposals—such as Medicare-for-all and the Green New Deal—that have gained steam in Congress and among the public.

There is a rich history of “the socialist” as a quintessentially American boogeyman. Irrational fears of socialists, communists, anarchists and pro-Soviet infiltrators overrunning the country destroyed many lives and careers in the 1920s and ’40s. There has never truly been a reconciliation or atonement for the two Red Scares, as they were called. Trump seems to be ushering in a third wave of anti-communist hysteria, to his political benefit. In fact, a newspaper editor in Alabama recently called for the Ku Klux Klan to engage in mass lynchings of Democrats because of the “socialist-communist ideology” prompting Democrats “to raise taxes in Alabama.”

This strategy puts left-leaning Democrats into the position of having to pick sides. Presidential hopefuls Kamala Harris and Beto O’Rourkehave both asserted their allegiance to capitalism in recent days. Elizabeth Warren—widely seen as the best leftist alternative to Bernie Sanders, famously said a year ago, “I am a capitalist to my bones.” If the only politicians proudly claiming to be socialists are a handful of stalwarts like Sanders, Ocasio-Cortez and Tlaib, their most-favored policy proposals can be more effectively demolished in the political realm.

What none of the detractors of socialism (including those who claim to be leftist capitalists) likes to draw attention to is the fact that we already have a partially socialist country. Such programs as Social Security and Medicare, as well as our public schools, parks and libraries, are all products of a socialist style of government. The issue is not—as Trump likes to put it—whether we will become a socialist country, but how socialist can or should we be? We accept that elderly Americans—but not all Americans—deserve Medicare. The question of “why?” is always met with an answer involving affordability, never morality.

When pointing to examples like Cuba and Venezuela, critics of socialism hate to admit that U.S. policies aimed at isolating those nations have crippled their economies. There is less compelling evidence of the “evils” of socialism in such countries as Denmark, Norway, Sweden and other Scandinavian nations; free-market fundamentalist outlets like The Heritage Foundation engage in mental gymnastics to claim that those nations are not truly socialist. Or if they are, it is because they are first and foremost capitalist, or because their people want a socialist government—but Americans do not.

It is possible that Americans will fall for the Trump-GOP trick of using socialism as a political tool. As Trump has successfully demonstrated, if you repeat a lie often enough, to enough people, it begins sounding like the truth. Just as he has conned millions of his supporters into believing there is some sort of violent crime wave washing over our borders with Mexico, or that he is the focus of a “witch hunt” by the special counsel investigators, he can and will convince a significant faction of Americans that socialism is evil and that the U.S. could turn into Venezuela if a Democrat wins the White House in 2020.

But unlike the relatively abstract problems of immigrant crime and federal investigations, Americans know intimately the failures of our current economic system, as measured by their personal bank accounts and pocketbooks. Socialism does not cause medical bankruptcies, burdensome college debt, high housing costs, stagnant wages or any of those markers of economic insecurity and struggle we know all too well. Our current capitalist system does. Perhaps when Trump supporters and Republican voters see this year’s tax returns, they will understand just how their politicians conned them into thinking that the 2017 landmark “tax reform” law was yet another rigging of the economy to benefit the rich.

The most effective way to tackle Trump’s propaganda effort to deploy “socialism” as a dirty word is to counter with how capitalism has failed. Rather than defend the current system staunchly, as House Speaker Nancy Pelosi does (“We’re capitalists, and that’s just the way it is”), or demand tweaks to a failed system, as Warren does, it is time to hammer home how bad the system is and demand much more from government.

After all, Americans overwhelmingly favor higher taxes on the rich. If implemented, such taxes could fund a Medicare-style health program for all Americans, or better public schools, broader welfare programs or a government green jobs program. It doesn’t matter what you called such a trend—socialist, democratic socialism or a social democracy. The fact is that unfettered capitalism is antithetical to the well-being of ordinary people, and our current system—rigged to favor the wealthy over the rest of us—proves that.

If Trump wants to associate socialism with Venezuela, his opponents would do well to simply and boldly associate the U.S. with capitalism—and all the ways it has failed us.

Trump Wants Socialism for the Rich, Harsh Capitalism for the Rest

by Robert Reich

Monday, February 11, 2019

"America will never be a socialist country,” Donald Trump declared in his State of the Union address. Someone should alert Trump that America is now a hotbed of socialism. But it is socialism for the rich. Everyone else is treated to harsh capitalism.

In the conservative mind, socialism means getting something for doing nothing. That pretty much describes the $21 billion saved by the nation’s largest banks last year thanks to Trump’s tax cuts, some of which went into massive bonuses for bank executives. On the other hand, more than 4,000 lower-level bank employees got a big dose of harsh capitalism. They lost their jobs.

Banks that are too big to fail – courtesy of the 2008 bank bailout – enjoy a hidden subsidy of some $83 billion a year, because creditors facing less risk accept lower interest on deposits and loans. Last year, Wall Street’s bonus pool was $31.4 billion. Take away the hidden subsidy and the bonus pool disappears.

Trump and his appointees at the Federal Reserve are easing bank requirements put in place after the bailout. They’ll make sure the biggest banks remain too big to fail.

Trump is promoting socialism for the rich and harsh capitalism for everyone else in other ways. Since he was elected, GM has got more than $600 million in federal contracts plus $500 million in tax breaks. Some of this has gone into the pockets of GM executives. Chairman and CEO Mary Barra raked in almost $22m in total compensation in 2017 alone.

But GM employees are subject to harsh capitalism. GM is planning to lay off more than 14,000 workers and close three assembly plants and two component factories in North America by the end of 2019.

When he was in business, Trump perfected the art of using bankruptcy to shield himself from the consequences of bad decisions – socialism for the rich at its worst – while leaving employees twisting in the wind.

Now, all over America, executives who run their companies into the ground are getting gold-plated exit packages while their workers get pink slips.

Sears is doling out $25 million to the executives who stripped its remaining assets and drove it into bankruptcy, but has no money for the thousands of workers it laid off.

As Pacific Gas and Electric hurtles toward bankruptcy, the person who was in charge when the deadly infernos roared through northern California last year (caused in part by PG&E’s faulty equipment) has departed with a cash severance package of $2.5 million. The PG&E executive in charge of gas operations when records were allegedly falsified left in 2018 with $6.9 million.

Under socialism for the rich, you can screw up big time and still reap big rewards. Equifax’s Richard Smith retired in 2017 with an $18 million pension in the wake of a security breach that exposed the personal information of 145 million consumers to hackers.

Wells Fargo’s Carrie Tolstedt departed with a $125 million exit package after being in charge of the unit that opened more than 2 million unauthorized customer accounts.

Around 60 percent of America’s wealth is now inherited. Many of today’s super rich have never done a day’s work in their lives.

Trump’s response has been to cut the estate tax to apply only to estates valued at over $22 million per couple. Mitch McConnell is now proposing that the estate tax be repealed altogether.

What about the capitalist principles that people earn what they’re worth in the market, and that economic gains should go to those who deserve them?

America is on the cusp of the largest inter-generational wealth transfer in history. As rich boomers expire over the next three decades, an estimated $30 trillion will go to their children.

Those children will be able to live off of the income these assets generate, and then leave the bulk of them to their own heirs, tax-free. (Capital gains taxes don’t apply to the soaring values of stocks, bonds, mansions and other assets of wealthy people who die before they’re sold.)

After a few generations of this, almost all of the nation’s wealth will be in the hands of a few thousand non-working families.

To the conservative mind, the specter of socialism conjures up a society in which no one is held accountable, and no one has to work for what they receive. Yet that’s exactly the society Trump and the Republicans are promoting for the rich.

Meanwhile, most Americans are subject to an increasingly harsh and arbitrary capitalism in which they’re working harder but getting nowhere, and have less security than ever.

They need thicker safety nets and deserve a bigger piece of the economic pie. If you want to call this socialism, fine. I call it fair.

The Venezuela Myth Keeping Us From Transforming Our Economy

by Ellen Brown, from truthdig, February 7, 2019

Alex Lanz / CC BY-NC-ND 2.0

Modern Monetary Theory (MMT) is getting significant media attention these days, after Rep. Alexandria Ocasio-Cortez said in an interviewthat it should “be a larger part of our conversation” when it comes to funding the “Green New Deal.” According to MMT, the government can spend what it needs without worrying about deficits. MMT expert and Bernie Sanders adviser professor Stephanie Kelton says the government actually creates money when it spends. The real limit on spending is not an artificially imposed debt ceiling but a lack of labor and materials to do the work, leading to generalized price inflation. Only when that real ceiling is hit does the money need to be taxed back, but even then it’s not to fund government spending. Instead, it’s needed to shrink the money supply in an economy that has run out of resources to put the extra money to work.

Predictably, critics have been quick to rebut, calling the trend to endorse MMT “disturbing” and “a joke that’s not funny.” In a Feb. 1 post on the Daily Reckoning, Brian Maher darkly envisioned Bernie Sanders getting elected in 2020 and implementing “Quantitative Easing for the People” based on MMT theories. To debunk the notion that governments can just “print the money” to solve their economic problems, he raised the specter of Venezuela, where “money” is everywhere but bare essentials are out of reach for many, the storefronts are empty, unemployment is at 33 percent and inflation is predicted to hit 1 million percent by the end of the year.

Blogger Arnold Kling also pointed to the Venezuelan hyperinflation. He described MMT as “the doctrine that because the government prints money, it can spend whatever it wants . . . until it can’t.” He said:

To me, the hyperinflation in Venezuela exemplifies what happens when a country reaches the “it can’t” point. The country is not at full employment. But the government can’t seem to spend its way out of difficulty. Somebody should ask these MMT rock stars about the Venezuela example.

I’m not an MMT rock star and won’t try to expound on its subtleties. (I would submit that under existing regulations, the government cannot actually create money when it spends, but that it should be able to. In fact, MMTers have acknowledged that problem; but it’s a subject for another article.) What I want to address here is the hyperinflation issue, and why Venezuelan hyperinflation and “QE for the People” are completely different animals.

What Is Different About Venezuela

Venezuela’s problems are not the result of the government issuing money and using it to hire people to build infrastructure, provide essential services and expand economic development. If it were, unemployment would not be at 33 percent and climbing. Venezuela has a problem the U.S. does not, and will never have: It owes massive debts in a currency it cannot print itself, namely, U.S. dollars. When oil (its principal resource) was booming, Venezuela was able to meet its repayment schedule. But when the price of oil plummeted, the government was reduced to printing Venezuelan bolivars and selling them for U.S. dollars on international currency exchanges. As speculators drove up the price of dollars, more and more printing was required by the government, massively deflating the national currency.

It was the same problem suffered by Weimar Germany and Zimbabwe, the two classic examples of hyperinflation typically raised to silence proponents of government expansion of the money supply before Venezuela suffered the same fate. Professor Michael Hudson, an actual economic rock star who supports MMT principles, has studied the hyperinflation question extensively. He confirms that those disasters were not due to governments issuing money to stimulate the economy. Rather, he writes, “Every hyperinflation in history has been caused by foreign debt service collapsing the exchange rate. The problem almost always has resulted from wartime foreign currency strains, not domestic spending.”

Venezuela and other countries that are carrying massive debts in currencies that are not their own are not sovereign. Governments that are sovereign can and have engaged in issuing their own currencies for infrastructure and development quite successfully. I have discussed a number of contemporary and historical examples in my earlier articles, including in Japan, China, Australia and Canada.

Although Venezuela is not technically at war, it is suffering from foreign currency strains triggered by aggressive attacks by a foreign power. U.S. economic sanctions have been going on for years, causing the country at least $20 billion in losses. About $7 billion of its assets are now being held hostage by the U.S., which has waged an undeclared war against Venezuela ever since George W. Bush’s failed military coup against President Hugo Chávez in 2002. Chávez boldly announced the “Bolivarian Revolution,” a series of economic and social reforms that dramatically reduced poverty and illiteracy as well as improved health and living conditions for millions of Venezuelans. The reforms, which included nationalizing key components of the nation’s economy, made Chávez a hero to millions of people and the enemy of Venezuela’s oligarchs.

Nicolás Maduro was elected president following Chávez’s death in 2013 and vowed to continue the Bolivarian Revolution. Recently, as Saddam Hussein and Moammar Gadhafi had done before him, he defiantly announced that Venezuela would not be trading oil in U.S.dollars following sanctions imposed by President Trump.

The notorious Elliott Abrams has now been appointed as special envoyto Venezuela. Considered a war criminal by many for covering up massacres committed by U.S.-backed death squads in Central America, Abrams was among the prominent neocons closely linked to Bush’s failed Venezuelan coup in 2002. National security adviser John Bolton is another key neocon architect advocating regime change in Venezuela. At press conference on Jan. 28, he held a yellow legal pad prominently displaying the words “5,000 troops to Colombia,” a country that shares a border with Venezuela. Clearly, the neocon contingent feels it has unfinished business there.

Bolton does not even pretend that it’s all about restoring “democracy.” He blatantly said on Fox News, “It will make a big difference to the United States economically if we could have American oil companies invest in and produce the oil capabilities in Venezuela.” As President Nixon said of U.S. tactics against Salvador Allende’s government in Chile, the point of sanctions and military threats is to squeeze the country economically.

Killing the Public Banking Revolution in Venezuela

It may be about more than oil, which recently hit record lows in the market. The U.S. hardly needs to invade a country to replenish its supplies. As with Libya and Iraq, another motive may be to suppress the banking revolution initiated by Venezuela’s upstart leaders.

The banking crisis of 2009–10 exposed the corruption and systemic weakness of Venezuelan banks. Some banks were engaged in questionable business practices. Others were seriously undercapitalized. Others still were apparently lending top executives large sums of money. At least one financier could not prove where he got the money to buy the banks he owned.

Rather than bailing out the culprits, as was done in the U.S., in 2009 the government nationalized seven Venezuelan banks, accounting for around 12 percent of the nation’s bank deposits. In 2010, more were taken over. Chávez’s government arrested at least 16 bankers and issued more than 40 corruption-related arrest warrants for others who had fled the country. By the end of March 2011, only 37 banks were left, down from 59 at the end of November 2009. State-owned institutions took a larger role, holding 35 percent of assets as of March 2011, while foreign institutions held just 13.2 percent of assets.

Over the howls of the media, in 2010 Chávez took the bold step of passing legislation defining the banking industry as one of “public service.” The legislation specified that 5 percent of the banks’ net profits must go toward funding community council projects, designed and implemented by communities for the benefit of communities. The Venezuelan government directed the allocation of bank credit to preferred sectors of the economy, and it increasingly became involved in private financial institutions’ operations. By law, nearly half the lending portfolios of Venezuelan banks had to be directed to particular mandated sectors of the economy, including small business and agriculture.

In a 2012 article titled “Venezuela Increases Banks’ Obligatory Social Contributions, U.S. and Europe Do Not,” Rachael Boothroyd said that the Venezuelan government was requiring the banks to give back. Housing was declared a constitutional right, and Venezuelan banks were obliged to contribute 15 percent of their yearly earnings to securing it. The government’s Great Housing Mission aimed to build 2.7 million free houses for low-income families before 2019. The goal was to create a social banking system that contributed to the development of society rather than simply siphoning off its wealth. Boothroyd wrote:

… Venezuelans are in the fortunate position of having a national government which prioritizes their life quality, wellbeing and development over the health of bankers’ and lobbyists’ pay checks. If the 2009 financial crisis demonstrated anything, it was that capitalism is quite simply incapable of regulating itself, and that is precisely where progressive governments and progressive government legislation needs to step in.

That is also where, in the U.S., the progressive wing of the Democratic Party is stepping in—and why Ocasio-Cortez’s proposals evoke howls in the media of the sort seen in Venezuela.

Article I, Section 8, of the Constitution gives Congress the power to create the nation’s money supply. Congress needs to exercise that power. The key to restoring our economic sovereignty is to reclaim the power to issue money from a commercial banking system that acknowledges no public responsibility beyond maximizing profits for its shareholders. Bank-created money is backed by the full faith and credit of the United States, including federal deposit insurance, access to the Fed’s lending window, and government bailouts when things go wrong. If we the people are backing the currency, it should be issued by the people through their representative government.

Today’s government, however, does not adequately represent the people, which is why we first need to take our government back. Thankfully, that is exactly what Ocasio-Cortez and her congressional allies are attempting to do.

---

Ellen Brown is an attorney, chairman of the Public Banking Institute, and author of twelve books including "Web of Debt" and "The Public Bank Solution." A thirteenth book titled "The Coming Revolution in Banking" is due out soon. She also co-hosts a radio program on PRN.FM called “It’s Our Money.” Her 300+ blog articles are posted at EllenBrown.com.

 

More Words of Wisdom From Frank Thomas

by Frank Thomas

 

I fully agree there's a dire need for an intelligent Democratic counter strategy, Jerry, to the non-sensical lashing out of  the label "socialism" by the right and its standard barrage of ad hominem one-liners. This labeling often reaches a desperate, severely insulting, even vitriolic level, e.g., calling Obama a fascist, and a socialist, and a communist - calling his health care plans a massive leap into central government planning and control. The right has become politically powerfully adept resorting consistently to attack ad hominems like, "socialism and socialistic," or  "any form of socialism leads to Big Brother government control and loss of freedoms."  Another example is Wayne LaPierre's (chairman of the NRA lobby syndicate) response to a public call for prompt, concrete, strict gun restrictions: "Socialists, in typical European style, want to take away our God given freedoms, the next one the right to own a firearm." Then he warns us, "You must be afraid." 

"

"Socialism" is the slur du jour ad hominem of the conservative right to denigrate, demean, distort, deflect, demonize liberals and ideas the right disagrees with. We have a long history of lumping "socialism" with almost all things "liberal." Today for many, the label continues to serve as an effective, if cynical sledgehammer against civil, rational, constructive give-and-take policy decision-making. Now Trump is becoming the new master socialist-accuser by tweet. The conservative right's long standing traditional fear is that America will turn into a decadent, socialistic age-old Europe. Thus, given our nation's long history of anti-socialist sentiments, it's good conservative strategy, e.g., to associate universal health care with "socialism." This applies to most government interventions. So Medicare and Medicaid are carrying us into the abyss of run-away socialism as is happening in Canada and Europe - so goes the ideological rant! American conservatives hold this philosophy sacrosanct for most government interventions while the 2009 great financial meltdown crisis of all crises showed once again how laissez faire capitalism is prone to extremely dangerous, costly market failures - given pure capitalism's natural inclination of blatant abuses and concentration of money in fewer and fewer hands. And this leads to a concentration of power. 

 

Since the New Deal, ideological battle lines over socialist or governmental intrusions into American lives have increased. For conservatives the political cry is liberty through capitalism and free markets. For liberals the political cry is equality through equal opportunity, government oversight, and social responsibility. Both liberty and equality have made great contributions to our nation since its founding. As I've said in previous writings, it's all about getting the right balance between capitalistic and social elements that fit a particular culture.  In Europe, the  political norm is that, "Whatever promotes the general welfare will also promote personal happiness and motivation as well as economic progress." This contrasts with the U.S. indoctrinated conservative norm starting in 1980 that , "Whatever promotes the corporate and individual welfare promotes the general welfare."  

 

The reality is that democracy needs a healthy balance and tension between these two elements to survive. Looking way back, it seems a miracle that at the high point in our cold war with Russia, a limited form of socialized medicine - Medicare - passed Congress and resistance by the insurance industry and the American Medical Association. Those forces now have teams of lobbyists influencing every key (and bought) Congressman in the policy-making process. The ordinary American ends up in effect having: no right to life if an insurance firm can deny one's coverage because of a prior illness history or inability to pay; no right to elect his or her leaders if a fair election or governing process is unjustly compromised or corrupted; no right to an equitable income if tax cut programs are designed to overwhelmingly favor the upper social class with the greater material influence.   

 

The European Way sorts out conflicting and competing interests behind capitalism's tremendous wealth creating capacity so that income and social benefits are broadly and fairly shared. Europe's  social democracies and market economies embrace the principles of both pursuing a free market and serving humanity. As one researcher explained, social democracy is all about a healthy, well-managed, thriving public system in education, health care, transportation, clean environment, child care, libraries, parks. It's all about government programs and blends of policy in concert with a competitive capitalistic dynamic that improve (or do not improve) the conditions of people's lives. In Europe, It's in general a very self-critical, exceptionally transparent process supported in most countries by multi-party systems and coalition governance where constructive compromise is a sine qua non. But the American conservative right disingenuously derides Europe's social-economic democratic model with the idiotic ad hominem one-liner it's essentially a welfare state. A better one-liner is workforce state. 

 

Meaning all social networks operate as part of a comprehensive system of institutions and policy decision-making that's geared towards keeping individuals and families healthy, productive, free working individuals to insure a vibrant, sustainable economy. This approach was originally conceived as a security revolution, NOT a socialist revolution by the conservative politicians - Churchill, Monnet, Adennauer, Schuman. In the words of Monnet, "Europe  will be attained by concrete achievements generating an active community of interest." The result since 1950?  There are as many if not more European Fortune 500 companies than U.S. China or Japan. The Netherlands, for example, is a small land one-half my state of Maine with nearly 18 million people with some very reputable, innovative world firms including Unilever, Phillips, Royal Dutch Shell, Heineken, KLM, DSM, ASML.   

 

Europeans in general don't see their unique form of hybrid capitalism with its high degree of economic freedom AND socialist elements as a conflicting societal norm ... but rather as a mutually reinforcing norm for improving the lot of ALL citizens. The developed economies of mature European countries are in essence "hybrids" that are constantly being refined. The private management is capitalistic while being the home also of public oversight and social institutions, providing strong job protections, well-trained labor markets and centralized unions, affordable quality health care and good coverage, relatively low-cost trade schools and colleges. Success has NOT been achieved by being more Right or more Left, by being more Capitalistic or more Socialistic. Labeling people, policies, programs socialistic and capitalistic as a discussion norm is seldom if ever done to evoke emotional reactions or to make prejudgements or charges that distort reality. The degree to which American conservatives automatically invoke the frightful specter of "socialism" serves no constructive purpose in advancing inclusive, creative, balanced, policy discussions and actions in Europe within multi-party and coalition governing systems. 

 

Here are a few words on "socialism" in 2009 by Jefferson Cowie and Nick Salvatore, American History Professors, Cornell University  

________________________________________________________________________________________________________________

 

"When socialism can be used interchangeably with fascism - as it often is in the heat of contemporary political debate - Americans 

are playing with historical fires they do not understand. America has not had a politically meaningful socialist movement since that 

of Eugene Debs early in the last century. The Soviet Union has perished, the Berlin Wall has fallen, and capitalistic China is our 

No. 1 industrial competitor. Against such a political landscape, what meaning could socialism have even as an epithet?

 

Those who hurl the "s-word" misunderstand the role of the state in American history. While they accurately point to the enormous 

growth in government since the Civil War and claim that it has stripped Americans of their individualism and self-reliance, the focus 

of the state's activities has been subsidizing and promoting "private" enterprise. Government growth promoted by Gilded Age 

Republicans, New Deal Age Democrats, and Reagan revolutionaries has been one of the most enduring constants in American 

history. Despite regular election cycle pleas to shrink the size of government, a unifying theme of political experience has been the 

government's growing intervention in the market on behalf of the business community.

 

For an exceptional few decades, however, things were different. Sparked by the Great Depression and the rise of the New Deal, the 

government expanded its responsibilities to include working people as well as business. It was not accidental that between 1945 and 

1972, while business grew drastically, income inequality declined significantly for Americans while posing no threat to the nation's 

wealthiest. Nor was it accidental that in the decades of growth since the early 1970s, a reversion to uniformly pro-business policies

promoted a significant rise in income inequality with the top 1% of all incomes enjoying the largest percentiles of growth. This too is

partly a direct result of government's beneficience to the private sector (business).  

 

The issue, therefore, is not government intervention, yes or no; rather it is on behalf of whose interests government intervenes. When

the government assists business by bailing out the financial markets - as it often should - it is called supporting the market. When 

government helps regular folks, as with health care reform, it stirs fears of something called "socialism."

 

Republican Theodore Roosevelt understood the central role of property for American individualism and citizenship - much like those 

who wield the fear-laden charge of "socialism" today. But, he argued in 1910, when human rights are in conflict with property rights,

"human rights must have the upper hand, for property belongs to man and not man to property." Some today would call this "socialism." 

My summary one-liner advice to Democrats: they should stop hiding and running from the words "socialism" and "socialistic." They should make the policy blend of social welfare and capitalism their way to  best achieve a humanly, democratically and financially sound, just, equitable, social-economic-political environment. They should talk up the good parts of it, take the heat when necessary and be transparently on the offensive for ALL Americans every day - especially for the bottom 90% to counter our movement into autocracy.

 

Off the Top of My Head

The Road to Serfdom

by John Lawrence

The Road to Serfdom is a book written by conservative Austrian economist Friedrich Hayek in which he contends that socialist type governments will lead everyone down the road to becoming serfs. Well just the opposite is occurring nowadays. The very success of free market capitalism has led us down the road to fantastic economic gains for some and serfdom for the masses. No one is arguing that the Bill Gates', Jeff Bezos' and Mark Zuckerberg's of the world haven't worked hard and made tremendous contributions to economic development. The problem is that the economic gains that people like these are responsible for have not been widely dispersed, but have been concentrated in the hands of a few people leading to an economic divide far greater than that of the Gilded Age and the robber barons.

Imagine if one man invented a robot that did all the work of the world. He would probably be very successful and make a lot of money. But this would also have the consequence that he would have eliminated workers from the face of the world. Therefore, those redundant workers would have no work and no income. Something like this is happening today. The automation of society and the very success of some has concentrated economic gains in the hands of a few people while the former workers have effectively become serfs scraping a few crumbs off the floor.

Economic inequality is accelerating exponentially, and capitalism, not socialism, is paving the Road to Serfdom. The jobs that haven't been automated are low paying service type jobs: retail in the eroding retail industry, baristas for Starbucks, caregivers, teachers, health care workers. While major industries concentrate their power by mergers and acquisitions and stock buybacks, the rest of us get by on menial jobs.

The net effect is that housing and rents get bid up in desirable areas by those on the wealthy side of the economic divide and more and more people are forced into homelessness. The only solution to this lack of affordable housing is for the government to build affordable housing. The free market won't do it. But that's socialism, n'est pas?. What, you think that the free market can't solve every problem? Well, you're right. It can't solve this one. Socialist type government solutions must come into play just in order that the haves can enjoy a downtown area not populated by people pissing and shitting all over the streets and leaving needles for tourists to step on.

Capitalists never fear, however. Mixed economies work the best as evidenced by the Nordic countries which combine entrepreneurialism with a safety net so that no one can fall too far down the ladder. In the US though you can fall as far as gravity will carry you. There is no bottom. So we have a growing homeless class which would have been unimaginable in the days of Lyndon Johnson and his War on Poverty. Those poverty stricken that he was concerned about at least had roofs over their heads.

Big Primary Wins for Socialists and Progressives Who Ran on 'Popular Demands That Were Deemed Impossible'

Published on Wednesday, May 16, 2018 by Common Dreams

"Welcome to the political revolution."

by Jake Johnson, staff writer

 

8 Comments

Running on a platform including Medicare for All and free public education, democratic socialist Summer Lee defeated her Democratic establishment-backed opponent Paul Costa in Pennsylvania's 34th State House District. (Photo: Nathan Shaulis/Summer for PA)

"This is what happens when you run grassroots campaigns."

"We're just getting started."

"Welcome to the political revolution."

Defying national and state-level Democratic establishment forces that have worked to crowd out left-wing candidates and demonstrating that there is a deep hunger among the American electorate for a bold progressive agenda, candidates running on platforms of Medicare for All, free college, and a living wage emerged victorious in several state primaries on Tuesday and tore through the boundaries of what is conventionally considered politically feasible.

"They said it wasn't possible without institutional support. That we couldn't talk about Medicare for All, a living wage, about ending corruption in Harrisburg. And you know what we did instead? We built something."
—Sara Innamorato, Pennsylvania State House candidate

 

"It feels like a monumental shift," Arielle Cohen, co-chair of Pittsburgh Democratic Socialists of America (DSA), told the Huffington Post after four DSA-backed candidates defeated establishment Democrats in Pennsylvania. "We won on popular demands that were deemed impossible. We won on healthcare for all; we won on free education."

Running in Pennsylvania's State House Districts 34 and 21 respectively, Summer Lee and Sara Innamorato—both running on platforms consisting of Medicare for All, strong environmental protection, and campaign finance reform—toppled what local news outlets described as a "political dynasty" by trouncing Democratic cousins Paul Costa and Dom Costa by a wide margin.

"They said it wasn't possible without institutional support. That we couldn't talk about Medicare for All, a living wage, about ending corruption in Harrisburg," Innamorato said during her victory party Tuesday night. "And you know what we did instead? We built something."

"The story is that the Costa cousins lost, but who they lost to, just as signifigant.

both of the challengers they faced were endorsed by @DemSocialists" #socialistscanwin pic.twitter.com/SHFV8Rsqrs

— People For Bernie (@People4Bernie) May 16, 2018

"The establishment's scared," Pittsburgh DSA wrote on Twitter in response to the upset victories, which also included wins by Elizabeth Fiedler and Kristin Seale over their establishment counterparts. "When we fight, we win."

Signs of the grassroots progressive wave that some predicted will ultimately sweep across the country could also be seen in Idaho on Tuesday, where progressive Paulette Jordan handily defeated her establishment-backed Democratic opponent A.J. Balukoff in a bid to become the nation's first Native American governor.

If she wins in November, Jordan—who ran on protecting public land from corporate plunder and criminal justice reform—would be Idaho's first Democratic governor in over 20 years.

"Today's elections prove movement politics candidates, who rely on people power, can win, and win powerfully," Ryan Greenwood, director of Movement Politics for People's Action, said in a statement on Wednesday. "Candidates for public office who commit to a racial and gender justice agenda that puts people and our planet before profits are winning."

This work is licensed under a Creative Commons Attribution-Share Alike 3.0 License

Off the Top of My Head

Homelessness is the Contradiction Capitalism Can't Deal With

by John Lawrence

Karl Marx proposed that history developed in such a way that the status quo represented what he called the thesis. The antithesis was whatever system was opposed to the thesis, and the synthesis  represented a transformation that integrated the two concepts. So if the thesis is capitalism in which everyone fends for themselves and there is no welfare or economic rights of any kind, and socialism is the antithesis in which economic rights and welfare are guaranteed, then what would the synthesis look like?

The US is a country in which political rights but not economic rights are guaranteed by the Constitution. In his 1941 State of the Union address, President Franklin D. Roosevelt proposed four freedoms. Freedom of speech and freedom of worship are already guaranteed by the Constitution. However, Freedom from Want went way beyond the Constitution. It constituted and economic right which is similar to what you have in a socialistic system. Economic rights are anathema to Republicans who want a society totally devoid of them. Their current plan espoused by Paul Ryan, Speaker of the House, is to roll back social security, medicare and medicaid on the grounds that there is no money for these social programs. After giving a one and a half trillion tax break to the rich, his argument is somewhat plausible.

According to Marx' theory the synthesis is triggered by a contradiction in the status quo or thesis which the system (capitalism) can't deal with or absorb. Such a contradiction is homelessness. First off it seems ridiculous that in the so-called world's richest nation hundreds of thousands of people should be living on the streets with nowhere to call home. Slaves had it better because at least they were taken care of to a certain extent because the slave owner needed to protect his investment. Secondly, the homeless represent a threat to the rest of the public because the lack of sanitation is leading to public health epidemics of which the spread of Hepatitis A in San Diego and Los Angeles is only the beginning.

So there is a contradiction between a city which caters to tourism and presents itself as "America's Finest City and thousands living on the streets with no adequate sanitation. It is clear this situation can't continue indefinitely although it has been treated for the most part by city authorities with "benign neglect." Cities have tried not to trample on the rights of the homeless as American citizens while not providing the economic wherewithal to get them all adequately taken care of. Tokenism has been part and parcel of the benign neglect strategy so that some few have been given adequate housing.

To guarantee adequate housing for those who cannot afford it would be an economic right which means that rich people would have to pay for housing for poor people. In other words their taxes would have to go up. This conservatives and Republicans want to avoid like the plague, but they may either have to accept the plague of higher taxes or they may have to accept the actual plague as it spreads from the homeless population into the general population.

So there is a contradiction here which is only getting worse with each passing year of fewer and fewer good paying jobs, rising debt and rising rents. The 1948 UN Declaration of Human Rights (which the US doesn't accept) calls for a right to adequate housing, food, sanitation etc. Many countries including Russia guarantee these things in their Constitutions whether or not they actually live up to them. The US can't go on forever ignoring the plight of an ever increasing homeless population. Either the American mindset has to change about the well off helping the not so well off or there will be a complete societal collapse. Out of the ruins, hopefully, will come a more humane society in which FDR's Freedom from Want is realized.

Socialism vs Capitalism

by Jon Kofas

From CESRAN International, 19 September, 2015

Introduction
Contemporary civilization and its progress under capitalism are measured largely, though not exclusively, by stock market indicators and the wealth index of corporations and millionaires that mainstream media celebrates. All other issues are only significant if they enhance or diminish corporate wealth. This includes the political, social, environmental issues that may either entail greater profit opportunities or instability and lower profits.“Accordingly, the extent to which corporate democracy represents general, social interests or narrow, profit-oriented interests is largely a function of political contestation and state policy.” Carl Gershenson, “Protecting Markets from Society: Non-Pecuniary Claims in American Corporate Democracy” Politics and Society (March, 2015, vol. 43, no. 1

Socialists envisioning a society rooted in humanist values and not capital accumulation for the tiny minority endeavored to tame the capitalist system from within with reforms and from the outside with protests so that it does not leave as many children and their parents destitute in soup kitchens and in back alleys sleeping in cardboard boxes, especially during hard times of deep recessions.

This “corporate measure” of the social contract in modern society is to the exclusion of the misery index in what Frantz Fanon once called “The Wretched of the Earth”, referring to the manner that imperialism determines social class in Africa and the masses’ reaction to create a more socially just society. The conditions Fanon described pertaining to Algerian struggle against French colonialism pertains today to conditions that capitalism universally creates and perpetuates as it always has since its nascent phase in the 15^th century when European colonialism and the transatlantic slave trade began. An African-American youth shot by the police in the ghetto in 2015 is just as much a victim of the same class formation that capitalism creates as an Algerian youth fighting against French colonial rule in the 1950s.

The corporate measure of the social contract and a successful civilization based on linear econometric progress of corporations is a sharp deviation from the humanist values of the Renaissance, the Scientific Revolution, and Enlightenment in Western Civilization rooted in creativity, intellectual achievements in everything from the arts to natural sciences, and to the welfare of humanity as a whole. The corporate measure of the social contract is an assertion of elitism and inequality and a rejection of humanist values and social justice.

Apologist of capitalism would of course give credit to capitalism as a system for unlocking human creative potential of such scientific and technological innovation. Since the transition in the 15^th century from the Feudal/Manorial social order/mode of production to capitalism there have been phenomenal technological and scientific inventions intended to improve everything from human health and comfort to unlocking the secrets of the universe. The same apologists, however, do not fault capitalism for structural poverty that persists on a world scale; for the countless wars in the name of capturing markets and increasing profits that have resulted in the deaths of hundreds of millions in the last five centuries; for societal violence emanating from socioeconomic inequality; and for human rights abuses and absence of social justice that are invariably at the core of capitalism.

In the post-Communist era, the specter haunting the entire world is neo-liberalism, driving many people to seek alternatives in some form of Socialism. The fall of Communist regimes had their experiments with one-party states and “command economies” in the name of the proletariat in the 20^th century. Those regimes failed for a variety of reasons including constant assault from capitalist countries at every level from the costly arms race to counterinsurgency operations and ideological propaganda campaigns. In the early 21^st century many people are wondering if the “End of History” celebrating the US Cold War victory over Communism (Francis Fukuyama, The End of History and the Last Man) that marked capitalism’s triumph means anything more than hegemony of the wealthy over the rest of the world’s population in every domain from economy and politics to the arts for profit.

Capitalism under neoliberal policies is indeed without rivals throughout the planet in the post-Communist era where the US remains the world’s sole superpower despite China’s economic challenge. Communism as it operated during the Maoist era no longer exists even in contemporary China that practices capitalism and abides by the same rules of the international market economy and its institutions such as the IMF, World Bank and World Trade Organization. The “end of history” is indeed the end of Communist regimes but merely another step in society’s evolution and the continued struggle between the hegemonic capitalist class and the masses seeking social justice.

Congress Passes Socialized Medicine and Mandates Health Insurance - In 1798

From Forbes:

by Rick Ungar

John Adams Image from Wikipedia

The ink was barely dry on the PPACA when the first of many lawsuits to block the mandated health insurance provisions of the law was filed in a Florida District Court.

The pleadings, in part, read -

The Constitution nowhere authorizes the United States to mandate, either directly or under threat of penalty, that all citizens and legal residents have qualifying health care coverage.

State of Florida, et al. vs. HHS

It turns out, the Founding Fathers would beg to disagree.

In July of 1798, Congress passed – and President John Adams signed - “An Act for the Relief of Sick and Disabled Seamen.” The law authorized the creation of a government operated marine hospital service and mandated that privately employed sailors be required to purchase health care insurance.

Keep in mind that the 5th Congress did not really need to struggle over the intentions of the drafters of the Constitutions in creating this Act as many of its members were the drafters of the Constitution.

And when the Bill came to the desk of President John Adams for signature, I think it’s safe to assume that the man in that chair had a pretty good grasp on what the framers had in mind.

Here’s how it happened.

During the early years of our union, the nation's leaders realized that foreign trade would be essential to the young country's ability to create a viable economy. To make it work, they relied on the nation’s private merchant ships - and the sailors that made them go - to be the instruments of this trade.

The problem was that a merchant mariner’s job was a difficult and dangerous undertaking in those days. Sailors were constantly hurting themselves, picking up weird tropical diseases, etc.

The troublesome reductions in manpower caused by back strains, twisted ankles and strange diseases often left a ship’s captain without enough sailors to get underway - a problem both bad for business and a strain on the nation’s economy.

But those were the days when members of Congress still used their collective heads to solve problems - not create them.

Realizing that a healthy maritime workforce was essential to the ability of our private merchant ships to engage in foreign trade, Congress and the President resolved to do something about it.

Enter “An Act for The Relief of Sick and Disabled Seamen”.

I encourage you to read the law as, in those days, legislation was short, to the point and fairly easy to understand.

A Society Built on Two Layers: Socialism and Capitalism

by John Lawrence

A society composed of layers of which the bottom layer is socialistic and includes free universal health care, free universal public education and a basic package consisting of food and housing, which could be provided "in kind" or in terms of a universal basic income, for those who can't afford to provide for themselves and their families, would be better than one in which there are absolutely no guarantees about anything and you're entirely on your own. On top of that the next layer could consist of capitalism in which businesses and corporations would be free to start industries and create products. Entrepreneurialism would be encouraged and rewarded.

No less a capitalist than Mark Zuckerberg, founder of Facebook, recommends a Universal Basic Income. He took a trip to Alaska recently and found that they had a version of it there:

The billionaire founder of Facebook Mark Zuckerberg spent his July 4th weekend in Alaska learning about fishing and local economics as part of his "Year of Travel Challenge." In Alaska, all residents get a yearly cash payment just for living in the state.

The trip gave Zuckerberg yet another platform to lobby for universal basic income (UBI), as he did during his commencement address to Harvard in May.

Alaska has a state-wide version of UBI. In 1976, the state voted to create the Alaska Permanent Fund as the Alaska pipeline construction neared completion. The goal was to share the oil riches with future generations. Still today, people living in Alaska get cash payouts from the fund, called the Permanent Fund Dividend. Recipients must be Alaska residents for the entire calendar year before applying, with no plans to leave the state, according to the Alaskan government's website.

Hey, if it's good enough for Mark Zuckerberg, it's good enough for me. American GDP is 70% consumer spending so what better way to get consumers to spend than to give them a little spending money. It'll get the wheels turning and that's what Zuckerberg's advertisers want. As the American corporations go more and more to automation, there will be fewer and fewer jobs, but the capacity for production will continue to increase, thanks to all those robots.

So let's hear it for capitalist Mark Zuckerberg and the Alaska Permanent Fund which hands out money to Alaskan citizens just becuase they can. Nobody's complaining about this handout as socialism.

People in Denmark Are Much Happier Than People in the United States

Eugene Debs and the Kingdom of Evil

From truthdig:

Posted on Jul 16, 2017

By Chris Hedges

Mr. Fish / Truthdig

 

TERRE HAUTE, Ind.—Eugene Victor Debs, whose home is an infrequently visited museum on the campus of Indiana State University, was the most important political figure of the 20th century. He built the socialist movement in America and was eventually crucified by the capitalist class when he and hundreds of thousands of followers became a potent political threat.

Debs burst onto the national stage when he organized a railroad strike in 1894 after the Pullman Co. cut wages by up to one-third but did not lower rents in company housing or reduce dividend payments to its stockholders. Over a hundred thousand workers staged what became the biggest strike in U.S. history on trains carrying Pullman cars.

The response was swift and brutal.

“Mobilizing all the powers of capital, the owners, representing twenty-four railroads with combined capital of $818,000,00, fought back with the courts and the armed forces of the Federal government behind them,” Barbara W. Tuchman writes in “The Proud Tower: A Portrait of the World Before the War, 1890-1914.” “Three thousand police in the Chicago area were mobilized against the strikers, five thousand professional strikebreakers were sworn in as Federal deputy marshals and given firearms; ultimately six thousand Federal and State troops were brought in, less for the protection of property and the public than to break the strike and crush the union.”

continue reading ...

Bernie Sanders' 12 Best Reasons for Being a Democratic Socialist

Sanders stands beside the New Deal, Great Society and civil rights movement.

 

By Steven Rosenfeld / AlterNet

 

November 19, 2015

 

In a highly anticipated speech, Sen. Bernie Sanders passionately detailed what being a democratic socialist means to him and would mean for Americans if elected president.

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After listing many metrics showing Americans today are working harder than ever yet facing undue pressures to pay for necessities like housing, healthcare, higher education and retirement, Sanders said democratic socialism means reviving the wisdom and policies behind President Franklin D. Roosevelt’s New Deal, Lyndon Johnson’s Great Society and Rev. Martin Luther King’s call for economic justice.

“Real freedom must include economic security,” Sanders said, quoting FDR’s 1944 speech calling for a second Bill of Rights for economic justice. “That was Roosevelt’s vision 70 years ago. It is my vision today. It is a vision that we have not yet achieved. And it is time that we did.”

“People are not free,” he continued. “They are not truly free when they are unable to feed their family. They are not truly free when they are unable to retire with dignity. They are not truly free when they are unemployed, underemployed or when they are exhausted by working 60, 70 hours a week. People are not truly free when they don’t know how they are going to get medical help, when they or a family member are sick.”

“So let me define for you, simply and straightforwardly, what democratic socialism means to me,” Sanders said. “It builds on what Franklin Delano Roosevelt said when he fought for guaranteed economic rights for all Americans. And it builds on what Martin Luther King, Jr. said in 1968 when he stated that, 'This country has socialism for the rich, and rugged individualism for the poor.' My view of democratic socialism builds on the success of many other countries around the world, who have done a far better job than we have in protecting the needs of their working families, their elderly citizens, their children, their sick and their poor.”

Sanders repeatedly reminded the Georgetown University audience that there was an epidemic of childhood poverty and other unmet needs across America, while the richest Americans are accumulating unprecedented wealth. He said the solutions could be funded by wealthly individuals and corporations paying a fair share of taxes.

What follows are a dozen excerpts from Sanders' speech of what democratic socialism means to him and could mean for the country. It is a vision of a better world that starts with improving the economics and the dignity of Americans at home, which in turn Sanders said would better position America to face challenges from abroad, such as the terrorist threat posed by ISIS, which he addressed in the final quarter of his 100-minute speech.

1. Major political and economic reforms. “Democratic socialism means that we must reform a political system which is corrupt, that we must create an economy that works for all, not just the very wealthy. Democratic socialism, to my mind, speaks to a system, which for example during the 1990s—and I want you to hear this—allowed Wall Street to spend $5 billion, over a 10-year period, in lobbying and campaign contributions in order to get deregulated. They wanted the government off of their backs. They wanted to do whatever they wanted to do….

"Then, 10 years later, after the greed, recklessness, and illegal behavior led to their collapse, what our system enabled them to get bailed out by the United States government, which through Congress and the Fed, provided trillions of dollars in aid to Wall Street. In other words, Wall Street used their wealth and power to get Congress to do their bidding for deregulation, and then when Wall Street collapsed, they used their wealth and power to get bailed out. Quite a system!

“And then, to add insult to injury, we were told that not only were the banks too big to fail, we were told that the bankers were too big to jail. And this is the system. Young people who get caught possessing marijuana, they get police records—and many many hundreds of thousands have police records that have impacted their lives in serious ways. On the other hand, Wall Street CEOs who help destroy the economy, they don’t get police records, they get raises in their salaries. And this is what Martin Luther King, Jr. meant when he talked about socialism for the rich and rugged individualism for everyone else.”

2. An end to corporate welfare. “It is time that we had democratic socialism for working families, not just for Wall Street billionaires. It means that we should not be providing welfare for corporations. It means that we should not be providing huge tax breaks for the wealthiest people in this country or trade policies, which boost corporate profits while they result in workers losing their jobs. It means that we create a government which works for all of the American people, not just powerful special interests. It means that economic rights must be an essential part of what America stands for.”

3. A national public healthcare system. “It means that health care should be a right of all people, not a privilege… I know that there are some people out there who think this is just an incredibly radical idea—imagine, in the United States of America, all of us, having health care as a right. But I hope all of you know this is not a radical idea. It is a conservative idea. It is an idea and a practice that exists in every other major country on earth.

"Not just in Scandanavia—in Denmark, in Sweden, in Finland or Norway. It exists in Canada—I live 50 miles away from Canada; not a radical idea. It exists in France, Germany, Taiwan. All over the world, countries have made the determination that all of their people are entitled to health care, and I believe the time is long overdue for the United States to join the rest of the world… And by the way, what a Medicare-for-all system will bring about is ending the absurdity of the American people paying, by far, the highest prices in the world for prescription drugs.”

4. Tuition-free public colleges and universities. “Now, when I talk about democratic socialism, what that means to me, is that in the year 2015, a college degree today is equivalent to what a high school degree was 50 years ago. And what that means is that public education must today allow every person in this country, who has the ability, the qualifications and the desire, the right to go to a public college or university tuition-free. Is this a radical socialistic idea? I don’t think so. It exists today in many countries all over the world. You know what, it used to exist in the United States of America. Great universities, like the University of California, the City University of New York, were virtually tuition-free.”

5. A government that creates jobs, not prisoners. “Democratic socialism means that our government does everything it can to create a full employment economy. It makes far more sense to me to put millions of people back to work rebuilding our crumbling infrastructure, than to have a real unemployment rate of almost 10 percent. It is far smarter to invest in jobs and educational opportunities for young people who are unemployed, than to lock them up and invest in jails and incarceration.”

6. A living minimum wage and real family leave. "Democratic socialism means that if someone works 40 hours a week, that person should not be living in poverty; that we must raise the minimum wage to a living wage—$15 bucks an hour over the next several years. It means that we join the rest of the world and pass the very strong Paid Family and Medical Leave legislation now sitting in Congress.

“I want you to think about this, and I want you to really see what goes on in our country today. It’s not only that every other major country—I’m not talking about Europe or Scandanavia—virtually every country in the world, poor countries, small countries, reach the conclusion that when a woman has a baby she should not be forced to be separated from that newborn baby after a week or two and have to go back to work. Making sure that moms and dads can stay home and get to love their babies is a family value that we should support. And that is why I want, and will fight, to end the absurdity of the United States being one of the only countries on Earth that does not guarantee at least three months of paid family and medical leave.”  

7. Stopping climate change-causing industries. "Democratic socialism to me means that we have government policy, strong government policy, which does not allow the greed and profiteering of the fossil fuel industry to destroy our environment and our planet. And it means to me that we have a moral responsibility to combat climate change and leave this planet healthy and inhabitable for our kids and grandchildren.”

8. The wealthy must pay a fair share of taxes. "Democratic socialism means that in a democratic, civilized society the wealthiest people and the largest corporations must pay their fair share of taxes. Yes, innovation, entrepreneurship and business success should be rewarded. But greed for the sake of greed is not something that public policy should support.

“It is not acceptable to me that in the period of time, the last two years, 15 of the wealthiest people in this country—15 people—saw their wealth increase, in this rigged economy, by $170 billion. Got it? Two years. Fifteen people, $170 billion increase in their wealth. That is more wealth than is owned by the bottom 130 million Americans. Let us not forget what Pope Francis has so elegantly stated and I quote: ‘We have created new idols. The worship of the golden calf of old has found a new and heartless image in the cult of money and the dictatorship of an economy which is faceless and lacking any truly humane goal.’ End of quote.

“In other words, we’ve got to do better than that. It’s not a political issue. It’s not an economic issue. It’s a cultural issue. We have got to stop worshipping people who make billions and billions and billions of dollars, while we have the highest rate of childhood poverty of any major country.”

9. America’s political system must be a democracy. “Democratic socialism, to me, does not just mean that we must create a nation of economic and social justice and environmental sanity. Of course, it does mean that. But it also means that we must create a vibrant democracy based on the principle of one person, one vote. It is extremely sad—and I hope all of you will pay a lot of attention to this issue—it is extremely sad that the United States, one of the oldest, most stable democracies in the world, has one of the lowest voter turnouts of any major country, and that millions of young people and working-class people have given up on the political process entirely.

“In the last midterm election, just a year ago, 63 percent of the American people didn’t vote, 80 percent of young people did not vote. Clearly, despite the efforts of many Republican governors, who want to suppress the vote, to make it harder for people of color and old people to participate in the political system, our job together is to make it easier for people to vote, not harder to vote. It is not a radical idea—and I will fight for this as hard as I can as president—to say that everyone in this country who is 18 years of age or older is registered to vote: end of discussion.”

10. Democratic socialism is not a government takeover. “The next time that you hear me attacked as a socialist—like tomorrow—remember this: I don’t believe government should take over the grocery store down the street, or own the means of production. But I do believe that the middle class and the working families, who produce the wealth of this country, deserve a decent standard of living, and that their incomes should go up, not down.

“I do believe in private companies that thrive and invest and grow in America, companies that create jobs here, rather than companies that are shutting down in America and increasing their profits by exploiting low-wage labor abroad. I believe that most Americans can pay lower taxes—if hedge fund managers who make billions manipulating the marketplace finally start paying the taxes that they should."

11. Equal treatment by government, not racism. “I don’t believe in special treatment for the top 1 percent, but I do believe in equal treatment for African Americans who are right to proclaim the moral principle that black lives matter. I despise appeals to nativism and prejudice, a lot of which we have been hearing in recent months. And I do proudly believe in immigration reform that gives Hispanics and others a pathway to citizenship and a better life.

“And while I am on that subject, let me say a real word of concern to what I have been hearing from some of the Republican candidates for president in recent months. People can have honest disagreements about immigration or about anything else. That’s called democracy. But people should not be using the political process to inject racism into the debate. And if Donald Trump and others refer to Latinos, people from Mexico, as criminals and rapists, if they want to open that door, our job is to shut that door and shut it tight.”

12. Do not become cynical; work for change. “Do not, do not, do not become cynical… I am running for president in order for all of us to be able to live in a nation of hope and opportunity, not for some, but for my seven grandchilden, and for all of you.  

“Nobody understood better than Franklin Delano Roosevelt the connection between American strength at home and our ability to defend America around the world. And that is why he proposed a second Bill of Rights in 1944, and said in that very same State of the Union, and I quote again, ‘America’s own rightful place in the world depends in large part upon how fully these and similar rights have been carried into practice for all our citizens. For unless there is security here at home there cannot be lasting peace—lasting peace—in the world.'"

Foreign Policy and the Use of Force

The final section of Sanders’ speech concerned foreign policy and whether the U.S. should use military force abroad. Sanders said, “I am not running for president to pursue reckless adventures abroad, but to rebuild America’s strength at home. I will never hesitate to defend this nation, but I will never send our sons and daughters to war under false pretense, or pretenses about dubious battles with no end in sight.”

Sanders said George W. Bush’s invasion of Iraq and war of choice was one of many examples where a foreign policy decision led to serious unanticipated consequences that unfolded over many years and destabilized entire regions. In that context, he said ISIS must be defeated by military and other policies, but, “we cannot, and should not, do it alone.” He said that could only happen when other Muslim countries in the region, especially wealthy nations like Saudi Arabia, became more involved and see this as a fight for "the soul of Islam," which is not an appropriate role for America.

“While the U.S. and other western nations have the strength of our militaries and political systems, the fight against ISIS is a struggle for the soul of Islam, and countering violent extremism and destroying ISIS must be done primarily by Muslim nations—with the strong support of their global partners,” Sanders said.

Unlike any of the other 2016 presidential candidates, Sanders said the U.S. must learn from past mistakes and not repeat them—such as using military force or intelligence agency coups for short-term political gains that backfire in the long run.

“Our response must begin with an understanding of past mistakes and missteps in our previous approaches to foreign policy,” he said. “It begins with the acknowledgment that unilateral military action should be a last resort, not a first resort, and that ill-conceived military decisions, such as the invasion of Iraq, can wreak far-reaching devastation and destabilization over regions for decades. It begins with the reflection that the failed policy decisions of the past—rushing to war, regime change in Iraq or toppling Mohammed Mossadegh in Iran in 1953: Mossadegh was the president. The CIA and others got rid of him, to protect British petroleum interests. The Shah of Iran came in, a brutal dictator, and he was thrown out by the Islamic revolution, and that is where we are in Iran today.

“Decisions have consequences, often unintended consequences,” he continued. “So whether it was Saddam Hussein, or Mossadegh, or Guatemalan president Árbenz in 1954, Brazilian president Goulart in 1964, Chilean president Allende in 1973—this type of regime change. This type of overthrowing governments we may not like, often does not work, often makes a bad and difficult decision even worse. These are lessons we must learn.”

---

 

Steven Rosenfeld covers national political issues for AlterNet, including America's retirement crisis, democracy and voting rights, and campaigns and elections. He is the author of "Count My Vote: A Citizen's Guide to Voting" (AlterNet Books, 2008).

Bernie Sanders, American Socialist

by John Lawrence from the San Diego Free Press

Bernie for President

Bernie Sanders has been drawing huge crowds to his rallies. The American media cannot ignore that. But they will never use the S word to describe Bernie even though that is how he describes himself. Bernie represents those who would tax Wall Street to preserve social security and a host of other common sense proposals. He dares to suggest that college should be free rather than the first stage of a life of indentured servitude and indebtedness.

People are listening - especially young people. Bernie has been saying these things for years but the media for the most part has been ignoring him. Now he has a bigger megaphone. His decision to run for President in order to get his message out there is paying off.

As Bernie himself has said: “the ideas and the points that we are making are reverberating very strongly with the American people.” Whoever would have thought that Bernie Sanders, Socialist, would be reverberating with the American people, the American people who love freedom and think that society should be set up in such a way that everybody has a chance, no matter how small, of getting rich?

On the other hand Bernie points out that social security is not in danger of running out of money. All you have to do is lift the cap and let rich people pay the same percentage of their income into it as do poor people. That is pretty reverberating if you can just get the message out. Bernie is getting the message out.

The media wants to call Bernie a "populist." Well, in this instance populism equals socialism. The notion that rich people should pay a higher percentage of their income in taxes as they did during the Eisenhauer administration, that there should be a tax on financial transactions and that taxes on the rich should support programs that aid the poor, is that populism or socialism, or both?

But then Americans have always been hypocritical about socialism. Even when they are enjoying the benefits from it, they don't want to acknowledge it. In an article in the New York Times, Socialism, American Style, Gar Alperovitz and Thomas M Hanna point out that socialism is a way of life in many American states including those that are considered "conservative." Only you can't call it that. That would not be politically correct.

Conservative Alaska is a Hotbed of Socialism

Take Alaska, for example. In this ultra conservative state there is a little socialist program known as The Alaska Permanent Fund. The Alaska Permanent Fund, established by a Republican governor in 1976, combines not one, but two socialist principles: public ownership and the provision of a basic income for all residents. The fund collects and invests proceeds from the extraction of oil and minerals in the state. Dividends are paid out annually to every man, woman and child in the state. Even Sarah Palin's family collects them.

This is from an article I wrote titled The Alaska Permanent Fund: Socialism in a Republican State:

Alaska is a land of rugged individualists - Republicans all the way. However, a little known fact is that Alaska taxes the oil and gas corporations operating there and distributes the proceeds on an annual basis equally among every man, woman and child living in the state. The biggest farce of all is that Tea Party touter, Governor Sarah Palin, slapped an excess profits tax on the state's oil companies in 2008, the year she ran for vice-President alongside John McCain, so that every person in Alaska received a dividend of $3269 that year. That was a pretty good haul for a family of four: $13,076. For Palin's family - husband Todd, sons Track and Trig and daughters Bristol, Willow and Piper - it came to an even better haul - $22,883!

We have also written about the Alaska Permanent Fund here. With global warming heating up the climate, more people will be moving to Alaska, not only in search of a moderate climate, but also to take advantage of the yearly stipend which might grow to the point that citizens of Alaska wouldn't have to work at all especially in view of the minerals that are becoming available due to the melting of the Arctic ice cap. Of course, that oil should stay in the ground if the earth has a chance of not warming up by 2 degrees C and causing widespread calamity.

Political correctness and hypocrisy demands that neither Palin nor any Republican politician mention the Alaska Permanent Fund nor any other socialist program from which money is taken from corporations and redistributed to the people. After all other states might get the idea that, if Alaska can do it, their state might be able to do the same thing. Well, in ultra conservative Texas, they've already figured that out: give lip service to conservative, rugged individualist principles while employing de facto socialist ones.

Texans Don't Mind Benefiting from a Socialist Policy

As Alperovitz and Hanna state:

Texas is another example of conservative socialism in practice. Almost 150 years ago the Texas Permanent School Fund took control of roughly half of all the land and associated mineral rights still in the public domain. In 1953, coastal “submerged lands” were added after being relinquished by the federal government. Each year distributions from the fund go to support education; in 2014 alone it gave $838.7 million to state schools. Another fund, the $17.5 billion Permanent University Fund, owns more than two million acres of land, the proceeds of which help underwrite the state’s public university system.

You'd think that Bernie Sanders would have plenty of supporters in Texas, namely all those who benefit from the Texas Permanent School Fund and Permanent University Fund, but instead they're all supporters of ultra conservative Governor Rick Perry, at least the majority consisting of white Texans are. Again lip service to conservatism while the actual reality they benefit from is socialism.

It's the same with Obamacare. All those southern conservatives who are benefiting from it love the reality while at the same time calling for its repeal. As a Washington Post article stated: "When the political history of the Affordable Care Act is written, Kentucky will occupy a special place in the tale. The implementation of the ACA there has helped produce the second steepest drop in the uninsured rate of any state. Yet even though that’s occurring in one of the most unhealthy regions in the country, the general idea of 'Obamacare' remains deeply unpopular."

Many countries employ the same principles, but without the hypocrisy. These funds are called sovereign wealth funds. Norway imposes a 50% tax on oil extraction which is put into its sovereign wealth fund which provides pensions and benefits for the Norwegian people. There's no talk there of "ending social security" because they don't have the money. Norwegians have plenty of money since they have profited from their co-owned public wealth in the form of oil extraction.

Only in America is there talk about the nonviability of social security. Most people don't even realize that if the rich paid into social security at the same rate as the poor, social security would be overfunded not underfunded and senior citizens could get a nice raise especially the needy ones.

Frank Thomas has written knowledgeably about Norway's sovereign wealth fund here:

The sovereign wealth fund in which Norway saves its oil-gas income is invested internationally primarily in stocks, bonds, and, starting recently, real estate. The strict primary goal is to save for future generations, when hydrocarbons run out.  Investing abroad also helps to avoid overheating the Norwegian economy. In 2009, the fund advanced 34% to recover most of the bubble losses.The fund now owns more than 1% of the world’s shares in over 8000 companies. It is Europe’s biggest equity investor. Strategically, the fund takes a 30 year investment horizon. Thus, not surprisingly,the fund is  currently investing aggressively in green industries. Helped by the past 30 year petroleum revenues that have been well-invested, Norway has become the 2nd richest nation per capita.

What if California Had Invested in a Sovereign Wealth Fund?

What if California would have taken control of its oil and gas revenues and invested in a sovereign wealth fund? There would be no budget problems today and there would be plenty of money to invest in infrastructure like desalination plants. California would have had the money to deal with its water shortage problems. Instead it became a debt based economy owing what amounts to a mortgage to Wall Street.

Another example: The Permanent Wyoming Mineral Trust Fund, with a market value of more than $7 billion accumulated from mineral extraction, has helped to eliminate income taxes in the state. The basic principle is that the mineral resources of the state belong to the citizens of that state not some private corporation. The idea is that the state should endeavor to enter into a relationship that adequately compensates the citizens for the extraction of their property.

One of the largest “socialist” enterprises in the nation is the Tennessee Valley Authority, a publicly owned company with $11 billion in sales revenue, nine million customers and 11,260 employees that produces electricity and helps manage the Tennessee River system. It seems that some socialist enterprises are not only very successful but are also very popular with the citizens who collectively profit from such enterprises.

Another example is publicly owned utilities. There are, in fact, already more than 2,000 publicly owned electric utilities that, along with cooperatives, supply more than 25 percent of the country’s electricity, now operating throughout the United States. In one of the most conservative states, Nebraska, every single resident and business receives electricity from publicly owned utilities, cooperatives or public power districts. Partly as a result, Nebraskans pay one of the lowest rates for electricity in the nation.

Perhaps the best example of public ownership or socialism, if you will, is the Public Bank of North Dakota (BND). Instead of shipping money to Wall Street, North Dakota uses the profits from its state owned bank to reduce taxes, invest in infrastructure and provide reasonable student loans. Many cities, counties and states are waking up to the fact that the profits that have heretofore been reaped by Wall Street from operations in their states should instead be reinvested in the state or public entity itself. The BND is serving as an example for them to follow. Private profit that goes into out of state investors' pockets is replaced by public profit which benefits citizens locally whether in a state or a city or other public entity.

The American People Should Derive Part of their Income From Public Wealth

As I said in the aforementioned article: Rich people live off of dividends, rent or interest paid to them in one form or other from their accumulated wealth. Public wealth is owned by the citizens of the US collectively. To receive a dividend from their co-owned wealth would tend to ameliorate the growing inequality of wealth ownership in the US and supplement poor and middle class incomes. Every citizen should be in a position of deriving at least a part of their income from co-owned wealth, especially since income from jobs is going downhill due to automation and outsourcing. This would eliminate poverty, provide a basic income guarantee, stimulate the economic system from the bottom up and restore the middle class.

The US is a debt based country which by virtue of the dollar's place as the world's reserve currency can continue to go into debt. Most other countries don't have this luxury so they start sovereign wealth funds which invest in American debt among other things so that their citizens are in the position of being investors while American citizens are essentially debtors for whom the chickens have not yet come home to roost.

Bernie Sanders' message is starting to make good sense to thousands of American people who are fed up with the BS Republicans have been feeding them. They are listening to Bernie, Elizabeth Warren, the Pope and the Dalai Lama and beginning to take seriously the facts of climate change, free public education up to the university level, Medicare for all and a beefed up social security program. Ownership of wealth and assets should not be only for the rich. Socialism provides that public wealth shall be redistributed to the poor and middle class as well.

The Alaska Permanent Fund: Socialism in a Republican State

by John Lawrence from the San Diego Free Press

Alaska is a land of rugged individualists - Republicans all the way. However, a little known fact is that Alaska taxes the oil and gas corporations operating there and distributes the proceeds on an annual basis equally among every man, woman and child living in the state. The biggest farce of all is that Tea Party touter, Governor Sarah Palin, slapped an excess profits tax on the state's oil companies in 2008, the year she ran for vice-President alongside John McCain, so that every person in Alaska received a dividend of $3269 that year. That was a pretty good haul for a family of four: $13,076. For Palin's family - husband Todd, sons Track and Trig and daughters Bristol, Willow and Piper - it came to an even better haul - $22,883!

Let me be clear. I am totally in favor of institutions like the Alaska Permanent Fund and think they should be extended to the entire US which would guarantee every American citizen a basic income which would come from things we all own in common like oil and mineral deposits, the electromagnetic spectrum and the air we breathe. But someone like Palin, who presided over a plan that taxed corporations and distributed the proceeds to each citizen of Alaska while at the same time taking humungus speaking fees to egg on the Tea Party with anti-tax, anti-socialist and free market rhetoric, is nothing but a super hypocrite, someone beyond the pale - in.

Jay Hammond, the Governor of Alaska from 1974 to 1982 is the father of Alaska's Permanent Fund. He conceived and then persuaded voters and legislators in a state of rugged individualists to adopt the world's first dividend paying fund of the sort that American forefather Thomas Paine envisioned. Paine in his pamphlet Agrarian Justice proposed a guaranteed basic income, a precursor of Social Security. Although supposedly ideologically opposed to such a plan, Alaskans approved it and it has proved to be a big success and very popular despite the state' s supposed rugged individualistic ethic. They thought it was a pretty good idea to get a check for over $1000. in the mail every year or, as is done today, a direct deposit wired into their bank account.

Since 1980 the fund has grown from $900 million in assets to over $44 billion today. It has paid yearly dividends to Alaskans that have regularly exceeded $1000. As Hammond conceived it, it enabled Alaskans to benefit from the many natural resources they owned in common rather than let private corporations, who are in the business of exploiting those resources, be the only beneficiaries.

The dividends from Alaska's fund have stimulated the economy from the bottom up rather than from the top down and have virtually eliminated poverty within the state. Alaska is economically one of the most equal states in the union.

But Palin is such a hypocrite. When asked by Sean Hannity about the inconsistency of her actions as Governor and her rhetoric as the queen bee of the Tea Party, Palin said "What we're doing up there is returning a share of resource development dollars back to the people who own the resources. Our constitution mandates that as you develop resources, it's to be for the maximum benefit of the people, not the corporations, not the government, but the people of Alaska." Very well, but then why all the rhetoric that extolls private over public interests and lowering as opposed to raising taxes on corporations?

Contrast this with what Palin told a Tea Party crowd on September 4, 2011: "So, to make America the most attractive and competitive place to do business, to set up shop here and hire people here, to attract capital from all over the globe that will lead to an explosion of growth, instead of chasing industry offshore, I propose to eliminate all federal corporate income tax." I suppose this doesn't include the Alaska Permanent Fund user's fee because it is not strictly speaking a tax. It's a user's fee! The fees charged the oil and gas corporations operating in Alaska are owed to the owners of the resource who happen to be the citizens of Alaska. This defies those like Tea Party activists who would privatize everything. But Palin would privatize everything as long as it was not her ox that was being gored!

Palin's rhetoric extolling the free market economy and lowering taxes on corporations flies in the face of the reality in her own state of Alaska. Her mouth is disconnected from her reality on the ground. The fact of the matter is that Alaska's reality should be extended to all citizens of the US who are the true owners of America's resources. There should be a permanent fund which collects monies owed to the American people and distributes them to every man, woman and child. Right now public resources rightfully owned by the American people are being privatized and profited from by large corporations feeding an ever increasing inequality. Royalties from the extraction industries are not anywhere near as high as they should be. They should go into a people's fund. Norway imposes a 50% tax on oil extraction which is put into its sovereign wealth fund which provides pensions and benefits for the Norwegian people. Of course, fossil fuel resources should be left in the ground in order to forestall global warming but that's a subject for another day.

The disconnect between right wing rhetoric and left wing reality is seen not only in Alaska but in Kentucky where the Kentucky version of Obamacare known as Kynect is hugely popular for what it accomplishes for the citizens of Kentucky. But on the rhetorical level Kentuckians all hate Obamacare. Mention Obamacare and they will lapse into a dither of denunciation. It is pretty pathetic that people will get so worked up over a name while loving a service provided as long as you call it by a different name.

As Peter Barnes points out in his book, With Liberty and Dividends for All, nothing is realized for the benefit of the people from the electromagnetic spectrum which is given away free to corporations. Nothing is realized for the co-owners of the system (us) that protects intellectual property and supports the financial system. A financial transaction tax (or user's fee if you prefer) could partially fund a dividend for the American people. Money creation, supposedly the province of the Congress, has been delegated to private banks who do it by the process of fractional reserve banking and for their own private profit. It should be done by the representatives of the American people, as specified in the Constitution, with the profits going to the American people via a sovereign wealth fund instead of to the private banks.

Co-ops and other forms of common ownership by worker/owners should make a portion of profits directly payable to worker/owners instead of holding the profits or spending them in common for them. This spreads the wealth rather than holding it in trust. A public bank could distribute its profits as dividends to the public that owned it instead of all the profits from banking going to Wall Street.

Rich people live off of dividends paid to them in one form or other from their accumulated wealth. Public wealth is owned by the citizens of the US collectively. To receive a dividend from their co-owned wealth would tend to ameliorate the growing inequality of wealth ownership in the US and supplement middle class incomes. Every citizen should be in a position of deriving at least a part of their income from co-owned wealth, especially since income from jobs is going downhill due to automation and outsourcing. It would eliminate poverty, provide a basic income guarantee, stimulate the economic system from the bottom up and restore the middle class.

The Practical Choice: Not American Capitalism or “Welfare State Socialism” but an Economy That’s Working for a Few or Many

by Robert Reich

Tuesday, May 20, 2014                

For years Americans have assumed that our hard-charging capitalism  is better than the soft-hearted version found in Canada and Europe. American capitalism might be a bit crueler but it generates faster growth and higher living standards overall. Canada’s and Europe’s “welfare-state socialism” is doomed.  

It was a questionable assumption to begin with, relying to some extent on our collective amnesia about the first three decades after World War II, when tax rates on top incomes in the U.S. never fell below 70 percent, a larger portion of our economy was invested in education than before or since, over a third of our private-sector workers were unionized, we came up with Medicare for the elderly and Medicaid for the poor, and built the biggest infrastructure project in history, known as the interstate highway system.

But then came America’s big U-turn, when we deregulated, de-unionized, lowered taxes on the top, ended welfare, and stopped investing as much of the economy in education and infrastructure.

Meanwhile, Canada and Europe continued on as before. Soviet communism went bust, and many of us assumed European and Canadian “socialism” would as well.

That’s why recent data from the Luxembourg Income Study Database  is so shocking.

The fact is, we’re falling behind. While median per capita income in the United States has stagnated since 2000, it’s up significantly in Canada and Northern Europe. Their typical worker’s income is now higher than ours, and their disposable income – after taxes – higher still.

It’s difficult to make exact comparisons of income across national borders because real purchasing power is hard to measure. But even if we assume Canadians and the citizens of several European nations have simply drawn even with the American middle class, they’re doing better in many other ways.

Most of them get free health care and subsidized child care. And if they lose their jobs, they get far more generous unemployment benefits than we do. (In fact, right now 75 percent of jobless Americans lack any unemployment benefits.)

If you think we make up for it by working less and getting paid more on an hourly basis, think again. There, at least three weeks paid vacation as the norm, along with paid sick leave, and paid parental leave.

We’re working an average of 4.6 percent more hours more than the typical Canadian worker, 21 percent more than the typical French worker, and a whopping 28 percent more than your typical German worker, according to data compiled by New York Times columnist Nicholas Kristof.

But at least Americans are more satisfied, aren’t we? Not really. According to opinion surveys and interviews, Canadians and Northern Europeans are.

They also live longer, their rate of infant mortality is lower, and women in these countries are far less likely to die as result of complications in pregnancy or childbirth.

But at least we’re the land of more equal opportunity, right? Wrong. Their poor kids have a better chance of getting ahead. While 42 percent of American kids born into poor families remain poor through their adult lives, only 30 percent of Britain’s poor kids remain impoverished – and even smaller percentages in other rich countries.

Yes, the American economy continues to grow faster than the economies of Canada and Europe. But faster growth hasn’t translated into higher living standards for most Americans.

Almost all our economic gains have been going to the top – into corporate profits and the stock market (more than a third of whose value is owned by the richest 1 percent). And into executive pay (European CEOs take home far less than their American counterparts).

America’s rich also pay much lower taxes than do the rich in Canada and Europe.

But surely Europe can’t go on like this. You hear it all the time: They can no longer afford their welfare state.

That depends on what’s meant by “welfare state.” If high-quality education is included, we’d do well to emulate them. Americans between the ages of 16 and 24 rank near the bottom among rich countries in literacy and numeracy. That spells trouble for the U.S. economy in the future.

They’re also doing more workforce training, and doing it better, than we are. The result is more skilled workers.  

Universal health care is another part of their “welfare state” that saves them money because healthier workers are more productive.

So let’s put ideology aside. The practical choice isn’t between capitalism and “welfare-state socialism.” It’s between a system that’s working for a few at the top, or one that’s working for just about everyone. Which would you prefer?

Local and State Governments Giving Away Billions to Corporations

by John Lawrence from the San Diego Free Press

Paradise Point is one of the big winners in San Diego.

States, counties and cities are in a race to the bottom because they are giving away taxpayer dollars to provide incentives for corporations to locate withing their boundaries. There's a fierce competition going on and corporations are playing one region off against another. Whichever one comes up with the largest package of cash grants and loans, sales tax breaks, income tax credits and exemptions, free services, and property tax abatements wins. Corporations hire people whose job it is to get them the best package. Mayors and Governors desperate for jobs for their citizens are giving away the store with the consequence that schools, parks and police and fire services are underfunded. City employees are forced to take pay and pension cuts in order that corporations can report to shareholders that they got the best possible deal.

And there is no guarantee that once these corporations have received said financial incentives that they will ever provide the jobs or that they won't pull up stakes after a short period in order to take advantage of even better incentives elsewhere. According to a New York Times investigation, states, counties and cities in the US are giving up more than $80 billion per year in order to get corporations to build plants or even offices in their areas. The beneficiaries encompass oil and coal conglomerates, technology and entertainment companies, banks and big-box retail chains - even dental offices, architect firms and wineries!

There are mayors and governors who are desperate to create jobs and who don't have the expertise to negotiate with corporations or even fact check what they are telling them. Corporations demanding subsidies threatened to move jobs overseas if they did not get subsidies in the United States. The state of Texas awards more incentives, over $19 billion a year, than any other state. As a consequence, Texas has the most underfunded school system in the whole country. Recently there was a border war between Kansas and Missouri. Last year Kansas recruited AMC Entertainment away from Missouri. This required a move of only a few miles from one side of the border to the other. In return Missouri lured Applebee's headquarters across the border from Kansas. The workers just had a littler farther to commute, that's all.

General Motors pushed hard for tax breaks in Ypsilanti Township, Mich. Some $200 million later, this is what remains.

The main victims of these wars between states and municipalities are the school systems which become underfunded by virtue of the loss in tax revenues because money is diverted from public education to corporations. Last year states cut public services and raised taxes by a collective $156 billion. Politicians want to be able to claim that they've brought new jobs into their state. The government of South Carolina recently took on a $218 million debt in order to get Boeing to locate a plant there and gave the company tax breaks for ten years. The state of Michigan gave General Motors $779 million in tax credits in 2009 just a month after GM received a $50 billion Federal bailout and decided to close seven plants there. These are just a few samplings of the horror stories out there that result from the absurd competition going on among various political entities and jurisdictions.

Cabela's sporting goods chain put the Mom and Pop sporting goods store, Weaknecht's, out of business in Hamburg, Pennsylvania based on tax giveaways. They had the local politicians in surrounding counties in Delaware, Pennsylvania and New Jersey competing with each other to see who was willing to pay the most in tribute to the sporting goods chain. They wanted at least $32 million. At this rate subsidies would cover more than half the cost of construction. Cabela's wanted an exemption from paying property taxes. But that wasn't all. They also wanted to pocket all the sales tax. According to David Cay Johnston in the book, Free Lunch:

"The tribute Cabela's demanded from Hamburg amounted to roughly $8000 for each man, woman and child in town. Hamburg was not a unique example, but part of a strategy to build Cabela's stores across the country. Multiply the tribute in Hamburg by as many struggling little towns off the interstates as Cabela's has plans for retail stores and the figures balloon. Cabela's plans to build stores until, like Holiday Inns, it is everywhere. Imagine how many of those towns are run by burghers who could be persuaded to opt for hope and forget about reason. To become the dominant outdoor retailer Cabela's would need only to find a few dozen or, if it could, a few hundred towns whose political leaders were willing to pay tribute. By doing so it could cut the risks of expansion and gain an advantage over business owners like Jim Weaknecht who offered better service and lower prices. Mining local and state governments for tribute could even turn into a business more lucrative for Cabela's than actually selling sporting goods."

President Bush and Dick Cheney campaigned at Cabela's in 2004 and Dick Cheney let on that it was his favorite place to shop. Presumably, it's where he bought the gun that shot his hunting companion in the face. Dick and Mary Cabela gave $11,000. to the Bush campaign.

Since he closed his store, Jim Weaknecht has worked as an assistant manager at a grocery store chain. He holds down a second job to in order to make ends meet, and sent his wife out to work for the first time instead of caring for the children. Cabela's offered him a job for $13.50 an hour.

In California Twitter cashed in on $22 million in payroll taxes after it threatened to leave San Francisco last year. It really didn't need the money. A Saudi prince invested $300. million and a private consortium, another $800. million. But Twitter was able to report to shareholders that it had made them as much short term money as it possibly could have. While the two investors got Twitter equity, the city of San Francisco got a hollow promise that Twitter would stay put. Of course there would be no consequences if it didn't. The

A playground in the Manor school district in Texas. In the background is a plant owned by Samsung, which has been awarded more than $231 million in incentives.

New York Times reported :

Like many places, San Francisco has been cutting its budget. Public parks have lost about $12 million in recent years, though workers at Twitter will not lack for greenery. The company’s plush new office has a rooftop garden with great views and amenities. Enjoying the perks, one employee sent out a tweet: “Tanned on Twitter’s new roof deck this morning as some dude served me smoothie shots. This is real life?”

Rick Perry likes to brag about all the jobs he's creating in Texas even though the state has the third highest proportion of hourly jobs paying at or below minimum wage and the 11th highest poverty rate among states. 

During a visit to San Diego, he bragged to local officials that about a third of the companies moving to Texas were from California according to Ruben Barrales, the chief executive of the San Diego Regional Chamber of Commerce. Mr. Barrales said that Rick Perry visited San Diego quite often and let companies know that if they chose to relocate, Texas would greet them with open arms.  When he was asked if he had qualms about taking jobs from other states, Rick Perry said, “Competition is what drives this country.”

California spends at least $4.17 billion per year on incentive programs, according to the most recent data available. That is roughly:

• $112 per capita
• 5¢ per dollar of state budget

California's incentives and subsidies include:

1. $2.29 billion in Corporate income tax credit, rebate or reduction
2. $1.44 billion in Corporate income and personal income tax breaks
3. $386 million in Sales tax refund, exemptions or other sales tax discounts

Twitter and Tesla Motors got a combined $42 million in corporate income tax credits, rebates or reductions from the state. Northrop Grumman got $9.8 million in 13 free services from the state. Hyatt Corporation got $3.07 million for 2 free services statewide. Raytheon got $2.74 million for 6 free services. The National Alliance of Business has received $1.08 million for two free services. Dunn-Edwards Corporation received $809,030 for 4 free services. Exxon Mobil received $596,596 for 1 free service.

The following is a not even an exhaustive list of subsidies to corporations in San Diego County:

Foundation College, LLC has received two grants worth $2.95 million for free services.  Aetna, Inc has received $2.82 for 4 free services. Foundation Foods LLC has received $2.35 million for 3 free services. Comprehensive Training Systems has received $1.17 million for 4 free services. Prime Healthcare Services received $749,658 for 2 free services. BAE Systems received $688,563 for 5 free services. General Dynamics received $583,364 for 1 free service. Rohr, Inc received $459,432 for 2 free services. Invitrogen Corporation received $387,810 for 1 free service. Coxcom, Inc received $343,477. for 1 free service. Calloway Golf received $338,016 for 2 free services.

The following have received subsidies for various amounts of free services:

San Diego Paradise Point Resort - $331,760. MSS Technologie Inc -  $304,709. Pharmingen - $301,252. San Diego-Imperial Counties Labor Council - $278,700. Remek Defense and Space Inc - $192,190. Southwest Marine Inc - $190,320. Geico - $149,682. Ericsson Wireless Communications - $90,320. Elgar Corporation - $171,984. Unisys Corporation - $163,475. Technology Integration Group - $143,691. Viasat Inc - $141,911.

Avail Medical Products Inc - $133,816. Cubic Defense Applications Inc - $114,525. Harbor Packaging - $110,235. Gemini Plastics Inc - $89,896. Sempra Energy - $89,136. Booz Allen Hamilton - $81,844. Spa Builders Support Group Inc - $81,150. Eaton Leonard Inc - $77,586. General Atomics - $76,963. San Diego Convention and Visitors Bureau - $76,640. Stillman Seal Corporation - $66,560. Hughes Network Systems - $64,350. Z Microsystems Inc - $63,084. CSA Travel Protection - $60,343.

Peregrine Semiconductor Corporation - $59,241. Taylor Guitars - $54,860. Greater San Diego Chamber of Commerce - $52,783. Sumitomo Metal Mining USA Inc - $50,684. Nextbio Inc - $49,140. Diversa Corporation - $48,685. Sony Electronics Inc - $44,213. Taylormade Golf Company Inc - $42,666. Standard Pacific Homes - $41,613. Natural Alternatives International Inc - $40,866. Nu Visions Manufacturing Inc - $36,791. National University - $32,654. Kyocera America Inc - $30,706.

Finally, Energy Innovations got $3.5 million in cash grants, loans or loan guarantees from the city of Poway and then went out of business costing 70 employees their jobs.

And it goes on and on for 90 pages! There are dental groups, sheet metal fabricators, platers, architects, cab companies, office products companies, engineering companies, bamboo companies, filter companies etc. You name it! If you're a corporation and you're not getting a piece of the government pie, you're a total LOSER.

One notable exception to this list - Qualcomm, San Diego's largest employer and a Fortune 400 company. I guess they figure they're profitable enough to pay their own way, but that hasn't stopped the likes of Exxon Mobil or Chevron from seeking and accepting taxpayer subsidies. My hat's off to Qualcomm for not picking the public's pocket.

Whew!!! When you add all this up, pretty soon you're talking about real money! Money that could have been spent on schools, parks and public services - and this is only a partial list! I challenge a commenter to add it all up and come up wth a total for San Diego County. I don't have the time or patience to do it.

This represents corporate welfare or another term for it is corporate socialism. So much for the free market. Do you think that this amount of money could have been spent on schools, parks, police, firemen and filling potholes instead? Why the San Diego Free Press would be happy to receive $50,000 in free services. Do you think that's possible? Don't bet on it.

The only solution to this mess is a national economic policy that would prevent this race to the bottom and ridiculous competition among states and local governments. The US should have an industrial policy that would promote trade and restrict competition for plant location. Obama has mentioned a cabinet level position of Secretary of Business. That might be a good start.

The Answer Isn’t Socialism; It’s Capitalism that Better Spreads the Benefits of the Productivity Revolution

by Robert Reich

Sunday, May 6, 2012

 

Francois Hollande’s victory doesn’t and shouldn’t mean a movement toward socialism in Europe or elsewhere. Socialism isn’t the answer to the basic problem haunting all rich nations. 

The answer is to reform capitalism. The world’s productivity revolution is outpacing the political will of rich societies to fairly distribute its benefits. The result is widening inequality coupled with slow growth and stubbornly high unemployment.

In the United States, almost all the gains from productivity growth have been going to the top 1 percent, and the percent of the working-age population with jobs is now lower than it’s been in more than thirty years (before the vast majority of women moved into paid work).

Inequality is also growing in Europe, along with chronic joblessness. Europe is finding it can no longer afford generous safety nets to catch everyone who has fallen out of the working economy.

Consumers in China are gaining ground but consumption continues to shrink as a share of China’s increasingly productive economy, while inequality in China is soaring. China’s wealthy elites are emulating the most conspicuous consumption of the rich in the West.

At the heart of the productivity revolution are the computers, software, and the Internet that have found their way into the production of almost everything a modern economy creates. Factory workers are being replaced by computerized machine tools and robotics; office workers, by software applications; professionals, by ever more specialized apps; communications and transportation workers, by the Internet.

Some work continues to be outsourced abroad to very low-wage workers in developing nations but this is not the major cause of the present trend. This work now comprises such a tiny fraction of the costs of production that it’s becoming cheaper for companies to do more of it at home with computers and software, and even bring back some of it (“in-source”) from abroad.   

Consumers in rich nations are reaping some of the benefits of the productivity revolution in the form of lower prices or more value for the money – consider the cost of color TVs, international phone calls, or cross-country flights compared to what they were before.

But most of the gains are going to the shareholders who own the companies, and to the relatively small number of very talented (or very lucky and well-connected) managers, engineers, designers, and legal or financial specialists on whom the companies depend for strategic decisions about what to produce and how.

Increasingly, via stock options and bonuses, the owners and the “talent” are one and the same. While many other people indirectly own shares of stock through their pensions and 401-K plans, 90 percent of the value of all financial assets in the U.S. belongs to the richest 10 percent of the American population.

Meanwhile, a large number of low-paid service workers sell personalized comfort and attention – something software can’t do — in the retail, restaurant, hotel, and hospital sectors (most U.S. job growth since 2009 has occurred here.) Others – temps, contract workers, the under- and partially-employed, fill in where they can. A growing number are not working.

The problem is not that the productivity revolution has caused unemployment or under-employment. The problem is its fruits haven’t been widely shared. Less work isn’t a bad thing. Most people prefer leisure. A productivity revolution such as we are experiencing should enable people to spend less time at work and have more time to do whatever they’d rather do.

The problem comes in the distribution of the benefits of the productivity revolution. A large portion of the population no longer earns the money it needs to live nearly as well as the productivity revolution would otherwise allow. It can’t afford the “leisure” its now experiencing involuntarily.

Not only is this a problem for them; it’s also a problem for the overall economy. It means that a growing portion of the population lacks the purchasing power to keep the economy going. In the United States, consumers account for 70 percent of economic activity. If they as a whole cannot afford to buy all the goods and services the productivity revolution is generating, the economy becomes stymied. Growth is anemic; unemployment remains high.

That’s why “supply-side” tax cuts for corporations and the wealthy are perverse. Corporations and the rich don’t need more tax cuts; they’re swimming in money as it is. The reason they don’t invest in additional productive capacity and hire more people is they don’t see a sufficient market for the added goods and services, which means an inadequate return on such investment.

But more Keynesian stimulus won’t help solve the more fundamental problem. Although added government spending has gone some way toward filling the gap in demand caused by consumers whose jobs and incomes are disappearing, it can’t be a permanent solution. Even if the wealthy paid their fair share of taxes, deficits would soon get out of control. Additional public investments in infrastructure and basic research and development can make the economy more productive – but more productivity doesn’t necessarily help if a growing portion of the population can’t absorb it.

What to do? Learn from our own history.

The last great surge in productivity occurred between 1870 and 1928, when the technologies of the first industrial revolution were combined with steam power and electricity, mass produced in giant companies enjoying vast economies of scale, and supplied and distributed over a widening system of rails. That ended abruptly in the Great Crash of 1929, when income and wealth had become so concentrated at the top (the owners and financiers of these vast combines) that most people couldn’t pay for all these new products and services without going deeply and hopelessly into debt – resulting in a bubble that loudly and inevitably popped.

If that sounds familiar, it should. A similar thing happened between 1980 and 2007, when productivity revolution of computers, software, and, eventually, the Internet spawned a new economy along with great fortunes. (It’s not coincidental that 1928 and 2007 mark the two peaks of income concentration in America over the last hundred years, in which the top 1 percent raked in over 23 percent of total income.)

But here’s the big difference. During the Depression decade of the 1930s, the nation reorganized itself so that the gains from growth were far more broadly distributed. The National Labor Relations Act of 1935 recognized unions’ rights to collectively bargain, and imposed a duty on employers to bargain in good faith. By the 1950s, a third of all workers in the United States were unionized, giving them the power to demand some of the gains from growth.

Meanwhile, Social Security, unemployment insurance, and worker’s compensation spread a broad safety net. The forty-hour workweek with time-and-a-half for overtime also helped share the work and spread the gains, as did a minimum wage. In 1965, Medicare and Medicaid broadened access to health care. And a progressive income tax, reaching well over 70 percent on the highest incomes, also helped ensure that the gains were spread fairly.

This time, though, the nation has taken no similar steps. Quite the contrary: A resurgent right insists on even more tax breaks for corporations and the rich, massive cuts in public spending that will destroy what’s left of our safety nets, including Social Security and Medicare and Medicaid, fewer rights for organized labor, more deregulation of labor markets, and a lower (or no) minimum wage.

This is, quite simply, nuts.

And this is why a second Obama administration, should there be one, must focus its attention on more broadly distributing the gains from growth. This doesn’t mean “redistributing” from rich to poor, as in a zero-sum game. It doesn’t mean socialism. The rich will do far better with a smaller share of a robust, growing economy than they’re doing with a large share of an economy that’s barely moving forward.

This will require real tax reform – not just a “Buffet” minimal tax but substantially higher marginal rates and more brackets at the top, with a capital gains rate matching the income-tax rate. It also means a larger Earned Income Tax Credit, whose benefits extend high into the middle class. That will enable many Americans to move to a 35-hour workweek without losing ground – thereby making room for more jobs.

It means Medicare for all rather than an absurdly-costly system that relies on private for-profit insurers and providers.

It will require limiting executive salaries and empowering workers to get a larger share of corporate profits. The Employee Free Choice Act should be an explicit part of the second-term agenda.

It will require strict limits on the voracious, irresponsible behavior of Wall Street, from which we’ve all suffered. The Glass-Steagall Act must be resurrected (the so-called Volcker Rule is more ridden with holes than cheese), and the big banks broken up.

And it will necessitate a public educational system – including early child education – second to none, and available to all our young people.

We don’t need socialism. We need a capitalism that works for the vast majority. The productivity revolution should be making our lives better — not poorer and more insecure. And it will do that when we have the political will to spread its benefits.

 

Book Review: After Capitalism

by Linda Greene, from The Bloomington Alternative

October 1, 2011

It’s easy to talk about socialism in the abstract, but hardly anyone tries to imagine and codify exactly what socialism in the United States could be like.

David Schweikart has a vision of what our society could be like after socialism replaces capitalism:

"[T]he Marxian vision of a new world is one in which the work I do — the work we all do — is both challenging and satisfying. Through work I develop my skills and talents, and have the pleasure of contributing to the well-being of others. The work I do involves my body as well as my mind, physical dexterity as well as intelligence — capacities that have been nurtured through education."

Schweikart’s book After Capitalism is an imaginative handbook for creating a socialist American society that succeeds capitalism. It describes in down-to-earth detail a replacement for capitalism that he calls "economic democracy” and how we can bring it about. The book is an entertaining and informative tour de force, with a lot of careful thought behind it. Only reading it can do justice to its complexity.

Schweikart lists four "fundamental problems” with capitalism: "staggering inequality, widespread unemployment, the intensification of work for those who remain employed, and intractable poverty, both domestic and global.”

Besides "its savage inequality,” capitalism is an irrational system: "How can it be,” Schweikart asks, "that the amazing technologies we keep developing tend to intensify, not lessen, the pace of work and make our jobs and lives less, not more, secure?”

***

Schweikart doesn’t envision the total overthrow of capitalism; he thinks it’s wise to incorporate the best qualities of capitalism into economic democracy. "A mass movement dedicated to establishing real as opposed to pseudo democracy is not going to trample on the genuine advances the previous order has achieved,” he says.

---

David Schweikart, After Capitalism, 2nd ed. Lanham, Md: Rowman & Littlefield Publishers Inc., 2011

---

"Economic democracy abolishes private ownership of the means of production and wage labor, but retains the market,” Schweikark says. In other words, economic democracy is a socialist system with a competitive market economy.

Economic democracy, according to Schweikart, has "three basic features, the second of which it shares with capitalism:”

Worker self-management: Each productive enterprise is controlled democratically by its workers.

The market: These enterprises interact with one another and with consumers in an environment largely free of government price controls. Raw materials, instruments of production, and consumer goods all are bought and sold at prices largely determined by the forces of supply and demand.

Social control of investment: Funds for new investment are generated by a capital assets tax and are returned to the economy through a network of public investment banks.”

In economic democracy the means of production belong to the whole society collectively, and workers lease them from the society. "A flat rate tax is the source of revenue and is distributed to regions on a per capita basis,” Schweikart says. The workers receive a "nationally specified minimum per capita income” and the profits of the firms they work in. That income is economic democracy’s "equivalent to the minimum wage.” The government is the "employer of last resort.”

Whereas capitalist companies strive to maximize total profits, in economic democracy the idea is to maximize profits per worker, according to Schweikart. "Economic democracy abolishes private ownership of the means of production and wage labor, but retains the market." Schweikart defines a capitalist as someone "who owns enough productive assets that he can live comfortably on the income from those assets.” Economic democracy makes capitalists obsolete.

Economic democracy is a "genuinely democratic, fully employed, stable, ecologically sustainable society without overwork or poverty,” Schweikart says. As he points out, a healthy capitalism requires unemployment to keep wages down. Further, the threat of job loss is the "basic disciplinary mechanism of the system.”

In economic democracy, as in capitalism, Schweikart says, "stimulating consumer demand is in the immediate interest of every enterprise.” Unlike capitalism, however, economic democacy is not "under competitive pressure to produce, make a profit, reinvest and grow.”

"The transformation from capitalism to economic democracy is nonviolent and comes about as a result of a social movement inspired by deep humanistic ideals (which is the only way it will ever come about),” Schweikart asserts. "One of the ‘conditions,’ if there is to be a relatively peaceful transition from capitalism to socialism, is the coming to power of a Left political party with a radical agenda,” he says.

The labor movement, of course, plays a critical role in changing the economic system, but that’s not to say that other struggles aren’t important and interrelated. As to issues of race, sex, ecology, peace, gay and lesbian liberation, prisons and so forth, "[N]one of these issues in fact can be treated in isolation from the others, although various movements will doubtless have distinctive emphases.”

***

Schweikart doesn’t merely elaborate on the characteristics of economic democracy but offers a blueprint for getting there. "Economic democracy abolishes private ownership of the means of production and wage labor, but retains the market." "Unlike capitalism, however, economic democacy is not 'under competitive pressure to produce, make a profit, reinvest and grow.'"

He suggests ways to move toward economic democracy by creating a more "benign form” of capitalism. Schweikart offers three scenarios for moving peacefully from capitalism to economic democracy, depending in part on the status of the economic system at the time.

After Capitalism leaves questions about specifics: What would happen to the military-industrial system under economic democracy? What would happen to Big Pharma? The health insurance industry? It’s a mark of a good book, however, that it leaves the reader eager to delve further into issues the book focuses on.

Democracy, Schweikart says, "is a system in which a universal electorate is reasonably well informed, active, and unobstructed by a privileged minority class.”

After Capitalism is a stimulating guidebook for those who want to work toward a genuine democracy in the United States.

Linda Greene can be reached at [email protected]

 

Dr. Doom Warns Wall St and Washington: Heed Karl Marx's Warning!

Posted by Tony Karon Tuesday, August 16, 2011 from time.com

Karl Marx was wrong about socialism, but he wasn't always wrong about capitalism. That's the warning from Nouriel Roubini, the NYU economics professor known on Wall Street as "Dr. Doom" — but hailed as a prophet nonetheless — for having warned that an economy expanding on giddy optimism, asset bubbles and Ponzi scheme paper was headed for a crash, and for doing so at a time when the Washington–Wall Street–media consensus was that the fundamentals of the economy were sound.

But having danced on the grave of the Soviet economic system, which finally imploded in 1990, a U.S. corporate, political and media elite weaned on the shibboleths of free-market capitalism wasn't about to embrace the jeremiads of a bearded 19th century German sage in whose name Lenin and then Stalin built their planned-economic nightmare.

Still, Marx knew a thing or two about capitalism that its boosters prefer to ignore, Roubini argues, and it's time to face up to some harsh realities.

"Karl Marx, it seems, was partly right in arguing that globalization, financial intermediation run amok, and redistribution of income and wealth from labor to capital could lead capitalism to self-destruct (though his view that socialism would be better has proved wrong)," writes Roubini. "Firms are cutting jobs because there is not enough final demand. But cutting jobs reduces labor income, increases inequality, and reduces final demand."

Anger at poverty, unemployment and despair is driving popular protest across the industrialized world, he notes, and "even the world's middle classes are feeling the squeeze of falling incomes and opportunities."

Marx, to put it more simply than he himself ever did, saw capitalism's market logic as producing recurring, ever more dangerous crises, precisely because of its tendency to channel most of the wealth produced in society into the pockets of a wealthy elite — and seeking to increase profits by cutting costs, i.e., the wage bill — leaving growing numbers of people no longer able to afford what was being produced, forcing a slowdown and contraction of the economy.

That sounds suspiciously like what we're seeing in the U.S. and other Western economies now — an economic crisis rooted in low and diminishing demand. Even though the financial crisis was averted, the economy has remained effectively stagnant at best, as depressed U.S. demand creates a vicious cycle in which corporations see no point in expanding production (and creating new jobs) if consumers can't afford to spend money and unemployment and poverty expands, further depressing demand.

The "greed is good" mantra may drive Wall Street, but greed can be bad for the wider capitalist economy. The depressed demand in the U.S. economy, for example, may be a product of decades of growing economic inequality. While real household incomes of working people have either remained largely static or fallen since the late 1970s, the rich have, to put it mildly, gotten a lot richer: incomes of the richest 1% have grown by more than 176% in the same period. Today 1 in 4 dollars earned in the U.S. accrues to just 1 in 100 Americans — or by a different measure, half of the income earned in the U.S. goes to just 1 in 5 Americans.

American society, of course, has never had a moral problem with inequality in principle, and there's a widely held — if naive — assumption that anyone who works hard and shows drive and ingenuity can become rich in the U.S. Perhaps, but for every Horatio Alger story, there are tens of thousands born on the wrong side of the tracks who are destined to die there. But the problem posed by inequality now is a structural rather than simply moral because of its impact on depressing demand in the economy.

Housing bubbles and cheap credit may have compensated for many years, with the robust consumer-driven economy essentially based on American households living beyond their means, their government borrowing money from China for them to spend on American brand-name products manufactured by low-wage Chinese workers. But when the subprime-mortgage bubble ruptured in 2008, it was no longer possible to defer the consequences of a massive long-term redistribution of wealth to the rich.

Marx was wrong, of course, in his prognosis that such crises would spark capitalism's collapse. Capitalist societies, including the U.S., have found, through their political systems, the means to avert collapse and its potentially dangerous political consequences by redistributing some of society's wealth to poorer sections of the population, spending money to build infrastructure and provide basic health care and education to a population that would otherwise struggle to afford those things. Capitalist societies also ensure that working people earn enough to maintain viable consuming households by creating a welfare support system that allows people to survive unemployment and continue consuming to provide a domestic market, and so on.

"To enable market-oriented economies to operate as they should and can, we need to return to the right balance between markets and provision of public goods," writes Roubini. "That means moving away from both the Anglo-Saxon model of laissez-faire and voodoo economics and the continental European model of deficit-driven welfare states. Both are broken."

He continues:

"The right balance today requires creating jobs partly through additional fiscal stimulus aimed at productive infrastructure investment. It also requires more progressive taxation; more short-term fiscal stimulus with medium- and long-term fiscal discipline; lender-of-last-resort support by monetary authorities to prevent ruinous runs on banks; reduction of the debt burden for insolvent households and other distressed economic agents; and stricter supervision and regulation of a financial system run amok; breaking up too-big-to-fail banks and oligopolistic trusts.

"Over time, advanced economies will need to invest in human capital, skills, and social safety nets to increase productivity and enable workers to compete, be flexible, and thrive in a globalized economy. The alternative is —  like in the 1930s — unending stagnation, depression, currency and trade wars, capital controls, financial crisis, sovereign insolvencies, and massive social and political instability."

In other words, capitalism can be saved from the excesses that Marx warned would be its downfall, but only through the sort of state intervention that has become almost as politically unfashionable as Karl Marx himself.

Read more: http://globalspin.blogs.time.com/2011/08/16/dr-doom-warns-wall-street-and-washington-heed-karl-marxs-warning/#ixzz1VIn1pTcq

The Commons Moment is Now

Published on Monday, January 24, 2011 by CommonDreams.org

How a small, dedicated group of people can transform the world—really

by Jay Walljasper

Social change is not something easily diagrammed on a chart. Sweeping transformations that rearrange the workings of an entire culture begin imperceptibly, quietly but steadily entering people’s minds until one day it seems the ideas were there all along. Even in our age of instantaneous information—when a scrap of information can zoom around the globe in mere seconds, people’s world views still evolve quite gradually.

Learning from the Right

This is exactly how the paradigm of corporate power came to rule the world. First articulated in large part by an obscure circle of Austrian economists, it surfaced in the United States during the 1950s as a curious political sideshow promoted by figures such as novelist Ayn Rand and her protégé Alan Greenspan.

The notion of the market as the bedrock of all social policy entered mainstream debate during the Goldwater campaign in 1964, which appeared to mark both its debut and its demise. Despite Republicans’ spectacular defeat in elections that fall—which extended from the White House all the way to local races—small bands of pro-market partisans refused to accept the unpopularity of their theories. Instead, they boldly launched a new movement that would eventually turn American life upside down.

Bankrolled by wealthy backers who understood that modern politics is a battle of ideas, market champions shed their image as fusty reactionaries swimming against the tide of progress and gradually refashioned themselves as visionaries charting a bold course for the future.

Their ranks swelled throughout the late 1970s as an unlikely combination of libertarian dreamers, big-business opportunists, and anxious defenders of traditional values signed up for the cause. The successive elections of Margaret Thatcher in Britain, Ronald Reagan in the United States, and François Mitterrand in France confirmed market fundamentalists’ global ascendancy. Thatcher and Reagan, each in her and his own distinct way, became effective advocates for the idea that the market should be the chief organizing principle of human endeavor. Mitterrand, on the other hand, was a dedicated socialist but soon discovered that the growing influence of international capital rendered him powerless to carry out promises of his 1981 election campaign. This was final confirmation that we had entered a new age of corporate domination.

Ever since then, our world has been shaped by these forces. Alan Greenspan became the most influential economic policy maker in recent history during eighteen years as chairman of the U.S. Federal Reserve. And the market paradigm is now seen by many — a lot of whom did not begin as right-wingers — as an indisputable truth on the same level as the Ten Commandments or the laws of physics.

Today, it feels as though everything is for sale to the highest bidder—from the names of sports stadiums to DNA sequences that make human life possible. Since the 1980s, reform movements of the left and center successfully resisted certain extreme elements of the radical right agenda, but many Americans still believe a free-market blueprint for the future is inevitable. Progress, once viewed as the gradual expansion of social equity and opportunity, is now widely viewed as the continual expansion of economic privatization and unchecked corporate power.

Introducing the Commons Paradigm

There are emerging signs that market fundamentalism has passed its peak as the defining idea of our era. In the United States, the first glimmer of hope was when the Bush administration’s plan to partially privatize Social Security funds in the stock market gained little traction in Congress and public opinion. Painful financial upheavals around the globe revealed the glaring weaknesses of the current economic model for all to see, leaving some market true believers scrambling to embrace new policies. Yet old ideologies don’t quietly fade, especially when they enjoy sizable support in the corporate world. We’ve seen a fierce backlash against Barack Obama’s admittedly modest departures from rigid market thinking.

At the same time, a group of activists, thinkers, and concerned citizens around the world who are rallying support for the idea of a commons-based society. At this point, they’re a scrappy bunch—many with backgrounds in various social movements, community causes, and Internet initiatives—not so different from the dedicated market advocates of the 1950s, except in where they place their hopes. These commoners, as they call themselves, see possibilities for large numbers of people of diverse ideological stripes coming together to chart a new, more cooperative direction for modern society.

The volatile political mood of our era bears some resemblance to the late 1970s when liberalism was losing its footing and conservative policy makers refashioned their old political rhetoric, based on social exclusion and apologies for capitalism, into a shiny new philosophy: “the market.” Pre- viously the thrust of right-wing thought had been focused on what they were against (civil rights, labor unions, social programs, et cetera), but by claiming the market as their mission, they were able to emphasize instead what they were for. The success of that rebranding has led to many of the problems we now grapple with today.

A New Political Dawn?

In the same way, commons-based thinking could eventually shift the balance of politics in the United States and the world. Yet unlike market fundamentalism, the commons is not just old wine in new bottles; it marks a substantive new dimension in political and social thinking.

A commons-based society holds considerable appeal for progressives after a long period in which the bulk of their political work has been in reaction to initiatives from the right. Activists across many social movements, now aware that an expansive political agenda will succeed better than narrow identity politics and single-issue crusades, are starting to experiment with the language and ideas of the commons. This line of thinking also makes sense to some traditional conservatives who regret the wanton destruction of our social and environmental assets carried out in the name of a free-market revolution. In the truest sense of the word, the commons is a conservative as well as progressive virtue because it aims to conserve and nurture all those things necessary for sustaining a healthy society.

Growing numbers of citizens—including many who never before questioned the status quo—now seem willing to explore new ideas that once would have seemed radical. Millions of Americans are now making shifts in their personal lives such as buying organic foods, using alternative medicine, collaborating online, and searching for something beyond consumerism that offers a sense of meaning in their lives. They may not yet be sprinkling their conversations with the word commons, but they are looking for changes in their lives.

Now is the time to introduce a decisive shift in worldview. People everywhere are yearning for a world that is safer, saner, more sustainable and satisfying. There’s a rising sense of possibility that even with our daunting economic and environmental problems, there are opportunities to make some fundamental improvements. Everyone deserves decent health care. The health of the planet should take precedence over the profits of a few. Clean water, adequate food, education, access to information, and economic opportunity ought to be available to all people. In other words, a commons-based society. Let’s transform that hope into constructive action. 

This excerpt originally appeared in All That We Share: A Field Guide to the Commons by Jay Walljasper, © 2010 Jay Walljasper, published by The New Press, reprinted here with permission.

Jay Walljasper is the editor and chief author of All That We Share: A Field Guide to the Commons. He is editor of OnTheCommons.org and author of The Great Neighborhood Book, writes widely about cities, community, sustainability and travel. On The Commons is a commons movement strategy center.

© 2010 Jay Walljasper, published by The New Press, reprinted here with permission.

Socialism? The Rich Are Winning the US Class War: Facts Show Rich Getting Richer, Everyone Else Poorer

Published on Monday, October 25, 2010 by CommonDreams.org

by Bill Quigley

The rich and their paid false prophets are doing a bang up job deceiving the poor and middle class. They have convinced many that an evil socialism is alive in the land and it is taking their fair share. But the deception cannot last – facts say otherwise.

Yes, there is a class war – the war of the rich on the poor and the middle class – and the rich are winning. That war has been going on for years. Look at the facts – facts the rich and their false paid prophets do not want people to know.

Let Glen Beck go on about socialists descending on Washington. Allow Rush Limbaugh to rail about “class warfare for a leftist agenda that will destroy our society.” They are well compensated false prophets for the rich.

The truth is that for the several decades the rich in the US have been getting richer and the poor and middle class have been getting poorer. Look at the facts then make up your own mind.

Poor Getting Poorer: Facts

The official US poverty numbers show we now have the highest number of poor people in 51 years. The official US poverty rate is 14.3 percent or 43.6 million people in poverty. One in five children in the US is poor; one in ten senior citizens is poor. Source: US Census Bureau.

One of every six workers, 26.8 million people, is unemployed or underemployed. This “real” unemployment rate is over 17%. There are 14.8 million people designated as “officially” unemployed by the government, a rate of 9.6 percent. Unemployment is worse for African American workers of whom 16.1 percent are unemployed. Another 9.5 million people who are working only part-time while they are seeking full-time work but have had their hours cut back or are so far only able to find work part-time are not counted in the official unemployment numbers. Also, an additional 2.5 million are reported unemployed but not counted because they are classified as discouraged workers in part because they have been out of work for more than 12 months. Source: US Department of Labor Bureau of Labor Statistics October 2010 report.

The median household income for whites in the US is $51,861; for Asians it is $65,469; for African Americans it is $32,584; for Latinos it is $38,039. Source: US Census Bureau.

Fifty million people in the US lack health insurance. Source: US Census Bureau.

Women in the US have a greater lifetime risk of dying from pregnancy-related conditions than women in 40 other countries. African American US women are nearly 4 times more likely to die of pregnancy-related complications than white women. Source: Amnesty International Maternal Health Care Crisis in the USA.

About 3.5 million people, about one-third of which are children, are homeless at some point in the year in the US. Source: National Law Center on Homelessness and Poverty.

Outside Atlanta, 33,000 people showed up to seek applications for low cost subsidized housing in August 2010. When Detroit offered emergency utility and housing assistance to help people facing evictions, more than 50,000 people showed up for the 3,000 vouchers. Source: News reports.

There are 49 million people in the US who live in households which eat only because they receive food stamps, visit food pantries or soup kitchens for help. Sixteen million are so poor they have skipped meals or foregone food at some point in the last year. This is the highest level since statistics have been kept. Source: US Department of Agriculture, Economic Research Service.

Middle Class Going Backward: Facts

One or two generations ago it was possible for a middle class family to live on one income. Now it takes two incomes to try to enjoy the same quality of life. Wages have not kept up with inflation; adjusted for inflation they have lost ground over the past ten years. The cost of housing, education and health care have all increased at a much higher rate than wages and salaries. In 1967, the middle 60 percent of households received over 52% of all income. In 1998, it was down to 47%. The share going to the poor has also fallen, with the top 20% seeing their share rise. Mark Trumball, “Obama’s challenge: reversing a decade of middle-class decline,” Christian Science Monitor, January 25, 2010. http://www.csmonitor.com/USA/2010/0125/Obama-s-challenge-reversing-a-decade-of-middle-class-decline

A record 2.8 million homes received a foreclosure notice in 2009, higher than both 2008 and 2007. In 2010, the rate is expected to be rise to 3 million homes. Sources: Reuters and RealtyTrac.

Eleven million homeowners (about one in four homeowners) in the US are “under water” or owe more on their mortgages than their house is worth. Source: “Home truths,” The Economist, October 23, 2010.

For the first time since the 1940s, the real incomes of middle-class families are lower at the end of the business cycle of the 2000s than they were at the beginning. Despite the fact that the American workforce is working harder and smarter than ever, they are sharing less and less in the benefits they are creating. This is true for white families but even truer for African American families whose gains in the 1990s have mostly been eliminated since then. Source: Jared Bernstein and Heidi Shierholz, State of Working America. http://www.stateofworkingamerica.org/swa08_00_execsum.pdf

Rich Getting Richer: Facts

The wealth of the richest 400 people in the US grew by 8% in the last year to $1.37 trillion. Source: Forbes 400: The super-rich get richer, September 22, 2010, Money.com

The top Hedge Fund Manager of 2009, David Tepper, “earned” $4 billion last year. The rest of the top ten earned: $3.3 billion, $2.5 billion, $2.3 billion, $1.4 billion, $1.3 billion (tie for 6th and 7th place), $900 million (tie for 8th and 9th place), and in last place out of the top ten, $825 million. Source: Business Insider. “Meet the top 10 earning hedge fund managers of 2009.” http://www.businessinsider.com/meet-the-top-10-earning-hedge-fund-managers-of-2009-2010-4

Income disparity in the US is now as bad as it was right before the Great Depression at the end of the 1920s. From 1979 to 2006, the richest 1% more than doubled their share of the total US income, from 10% to 23%. The richest 1% have an average annual income of more than $1.3 million. For the last 25 years, over 90% of the total growth in income in the US went to the top 10% earners – leaving 9% of all income to be shared by the bottom 90%. Source: Jared Bernstein and Heidi Shierholz, State of Working America. http://www.stateofworkingamerica.org/tabfig/2008/01/19.pdf

In 1973, the average US CEO was paid $27 for every dollar paid to a typical worker; by 2007 that ratio had grown to $275 to $1. Source: Jared Bernstein and Heidi Shierholz, State of Working America. http://www.stateofworkingamerica.org/tabfig/2008/03/SWA08_Wages_Figure.3AE.pdf

Since 1992, the average tax rate on the richest 400 taxpayers in the US dropped from 26.8% to 16.62%. Source: US Internal Revenue Service. http://www.irs.gov/pub/irs-soi/07intop400.pdf

The US has the greatest inequality between rich and poor among all Western industrialized nations and it has been getting worse for 40 years. The World Factbook, published by the CIA, includes an international ranking of the inequality among families inside of each country, called the Gini Index. The US ranking of 45 in 2007 is the same as Argentina, Cameroon, and Cote d’Ivorie. The highest inequality can be found in countries like Namibia, South Africa, Haiti and Guatemala. The US ranking of 45 compares poorly to Japan (38), India (36), New Zealand, UK (34), Greece (33), Spain (32), Canada (32), France (32), South Korea (31), Netherlands (30), Ireland (30), Australia (30), Germany (27), Norway (25), and Sweden (23). Source: CIA The World Factbook: https://www.cia.gov/library/publications/the-world-factbook/fields/2172.html

Rich people live an average of about five years longer than poor people in the US. Naturally, gross inequality has consequences in terms of health, exposure to unhealthy working conditions, nutrition and lifestyle. In 1980, the most well off in the US had a life expectancy of 2.8 years over the least well-off. As the inequality gap widens, so does the life expectancy gap. In 1990, the gap was a little less than 4 years. In 2000, the least well-off could expect to live to age of 74.7 while the most well off had a life expectancy of 79.2 years. Source: Elise Gould, “Growing disparities in life expectancy,” Economic Policy Institute. http://www.epi.org/economic_snapshots/entry/webfeatures_snapshots_20080716/

Conclusion

These are extremely troubling facts for anyone concerned about economic fairness, equality of opportunity, and justice.

Thomas Jefferson once observed that the systematic restructuring of society to benefit the rich over the poor and middle class is a natural appetite of the rich. “Experience declares that man is the only animal which devours his own kind, for I can apply no milder term to…the general prey of the rich on the poor.” But Jefferson also knew that justice can only be delayed so long when he said, “I tremble for my country when I reflect that God is just, that his justice cannot sleep forever.”

The rich talk about the rise of socialism to divert attention from the fact that they are devouring the basics of the poor and everyone else. Many of those crying socialism the loudest are doing it to enrich or empower themselves. They are right about one thing – there is a class war going on in the US. The rich are winning their class war, and it is time for everyone else to fight back for economic justice.

Bill is Legal Director of the Center for Constitutional Rights and professor of law at Loyola University New Orleans. You can reach Bill at [email protected]

Why Germany Has It So Good -- and Why America Is Going Down the Drain

Germans have six weeks of federally mandated vacation, free university tuition, and nursing care. Why the US pales in comparison.

by Terrence McNally

Published by AlterNet, October 14, 2010 

While the bad news of the Euro crisis makes headlines in the US, we hear next to nothing about a quiet revolution in Europe. The European Union, 27 member nations with a half billion people, has become the largest, wealthiest trading bloc in the world, producing nearly a third of the world's economy -- nearly as large as the US and China combined. Europe has more Fortune 500 companies than either the US, China or Japan.

European nations spend far less than the United States for universal healthcare rated by the World Health Organization as the best in the world, even as U.S. health care is ranked 37th. Europe leads in confronting global climate change with renewable energy technologies, creating hundreds of thousands of new jobs in the process. Europe is twice as energy efficient as the US and their ecological "footprint" (the amount of the earth's capacity that a population consumes) is about half that of the United States for the same standard of living.

Unemployment in the US is widespread and becoming chronic, but when Americans have jobs, we work much longer hours than our peers in Europe. Before the recession, Americans were working 1,804 hours per year versus 1,436 hours for Germans -- the equivalent of nine extra 40-hour weeks per year.

In his new book, Were You Born on the Wrong Continent?, Thomas Geoghegan makes a strong case that European social democracies -- particularly Germany -- have some lessons and models that might make life a lot more livable. Germans have six weeks of federally mandated vacation, free university tuition, and nursing care. But you've heard the arguments for years about how those wussy Europeans can't compete in a global economy. You've heard that so many times, you might believe it. But like so many things, the media repeats endlessly, it's just not true.

According to Geoghegan, "Since 2003, it's not China but Germany, that colossus of European socialism, that has either led the world in export sales or at least been tied for first. Even as we in the United States fall more deeply into the clutches of our foreign creditors -- China foremost among them -- Germany has somehow managed to create a high-wage, unionized economy without shipping all its jobs abroad or creating a massive trade deficit, or any trade deficit at all. And even as the Germans outsell the United States, they manage to take six weeks of vacation every year. They're beating us with one hand tied behind their back."

Thomas Geoghegan, a graduate of Harvard and Harvard Law School, is a labor lawyer with Despres, Schwartz and Geoghegan in Chicago. He has been a staff writer and contributing writer to The New Republic, and his work has appeared in many other journals. Geoghagen ran unsuccessfully in the Democratic Congressional primary to succeed Rahm Emanuel, and is the author of six books including Whose Side Are You on, The Secret Lives of Citizens, and, most recently, Were You Born on the Wrong Continent?

How Exactly, Mr. Reich, Do You Create Jobs?

by John Lawrence

Robert Reich writes in his October 1 post that lowering the value of the dollar is not the way to create jobs in the US. Lowering the value of the dollar seems to be the US government's job creation policy at this time. The theory is that that will produce more exports because our products will be cheaper abroad and fewer imports because imported products will be more expensive. Mr. Reich contends that other countries will simply follow suit and lower the value of their currencies. Result: a currency war.

The other way the Obama administration seems to favor for creating jobs is just to wait for the natural dynamics of the US economy to create them. The theory is that the US economy is so resilient that, if we wait long enough, it will just naturally recover and things will go back to normal - normal being 5% unemployment. This might be called the cross-your-fingers-and-wait-and-see approach. This approach is doomed to failure for reasons that have been mentioned on this blog before - outsourcing of jobs and automation, to be succinct. OK, then, what are some other methods by which jobs might be created. Innovation, for one thing. The creation of whole new industries. Technological innovation has fueled capitalism for centuries. Recently, computers and the internet are good examples. Problem is there are no new innovations on the horizon. Especially ones of an exclusively American nature. While the computerization of the world was conceived, developed and capitalized on in the US, current innovative technologies like alternative energy are being pursued more vigorously elsewhere. Automoble technology was developed concurrently in other countries but at a time when outsourcing was impractical so the development of the automobile proceeded independently in a number of countries as if they were on separate planets. In today's world that would not be possible.

Labor arbitrage means that major production facilities will be located wherever the cost of plants, equipment and labor is cheapest. Automation means that most products can be manufactured with a minimum of human labor. So where does this leave Americans who need to work in order to have an income that will let them consume the products and services that they need in order to have at least a decent middle class life? In other words where are the good jobs at good pay going to come from? Of course, one alternative is for Americans to work for starvation wages. There will always be a certain number of low paying service jobs available. But in order to have widespread prosperity among the majority of the population, there are only a few remaining alternatives none of which is being given serious consideration at this time.

Alternative #1: The government sets an industrial policy and subsidizes the development of certain industries which can compete at a world class level. Such is the case with Finland where Nokia has competed successfully at a world level and as a result brought prosperity to Finland. This is also true in Germany which has successfully retained a manufacturing base and has profited from its exports.

Alternative #2: The government sets up public/private partnerships to internally develop the US infrastructure. This in turn will lead to the creation of more private sector jobs following in the wake of infrastructure development just as the development of the railroads or the interstate highway system opened up opportunities for private sector development.

Alternative #3: The US government can create jobs directly in areas that the private sector is not interested in. This was done during the Great Depression when FDR created the Works Project Administration (WPA) and the Civilian Conservation Corps (CCC). There is just as great a need for conservation type projects today and just as much of a lack of interest on the part of the private sector. In fact the private sector ususally is in the business of degrading the environment rather than protecting or enhancing it. This creates an opportunity for government to be in the business of enhancing the environment in such a way that it is not in competition with private enterprise. There may be other areas where government can directly create jobs in ways that do not compete with private enterprise or in ways that are symbiotic with private enterprise. It is possible for government and private enterprise to be involved in a positive sum game, one which is beneficial for both sectors.

Alternative #4: Spread the wealth. Redistribution of wealth. Since income and wealth are becoming more centralized and concentrated (23.5% of income in 2007 went to the upper 1% similar to 1928 just before the Great Depression), the upper income brackets can be taxed heavily and the money used to create jobs ala the WPA and CCC or it can be redistributed by providing unemployment benefits and food and housing subsidies. In other words the social safety net could be greatly expanded. My preference is for the direct and indirect creation of jobs since I think that work is more ennobling than permanently remaining on the dole. Marx was right about the natural tendency of capitalism, particularly unregulated laissez faire capitalism, to centralize and concentrate capital in fewer and fewer hands. Economic inequality in the US has never been greater except just before the Great Depression.

The US is the most laissez faire capitalist country on the planet. At least it has been so for the last 30 years ever since Reagan became President. The lowering of tax rates on the upper income brackets and the deregulation of corporate industry has produced a society in which most of the economic benefits go to a very small number of people at the top. Other countries have prevented this phenomenon by means of their governments being more directly involved in their economies. Whether its the Euro zone, China, Japan or other prosperous nations, they are all - as governments - more directly involved in their economies than the US which has essentially a hands off policy between the government and the economy. Unfortunately for the US, these other nations are becoming more prosperous as the US loses ground. These capitalist hybrid economies especially in China are gaining while the US is losing. Another reason the US is falling further behind is that, while the other capitalist economies have been devoting large amounts of resources with a hands on policy towards their commercial sectors, the US has devoted huge amounts of resources with a hands on policy to its defense sector while maintaining a hands off policy towards its commercial sector.  Unfettered, unregulated capitalism is proving to be not as successful an economic model as is hybrid capitalism.

Government involvement in the economy, what might be called a socialist-capitalist hybrid, seems to be evolving as the successful economic model of the 21st century. Governments that don't have industrial policies such as the US and leave everything to a hands off policy towards the economy seem destined to stagnation. They are heading in the direction of Third World status which is defined as a country with a very small, very wealthy elite surrounded by a very large poverty class. This seems to be what unregulated capitalism produces.

Do Germany and China Have Better Economic Models Than the US?

From Harper's Magazine
March 2010
p. 7—9

Consider the Germans

By Thomas Geoghegan

Come on: is the West really in such decline? Yes, we can sit here on our island continent and gloom about the rise of China, as our elite now like to do. Or we can go out into the world and start competing like the Europeans. For here's a strange fact: since 2003, it's not China but Germany, that colossus of European socialism, that has either led the world in export sales or at least been tied for first. Even as we in the United States fall more deeply into the clutches of our foreign creditors—China foremost among them—Germany has somehow managed to create a high-wage, unionized economy without shipping all its jobs abroad or creating a massive trade deficit, or any trade deficit at all. Sure, China just pulled slightly ahead of Germany, but that's mostly because the euro has soared, making German goods even more expensive, and world trade has slumped. Meanwhile, the dollar is dropping, and we still can't compete with either nation. And even as the Germans outsell the United States, they manage to take six weeks of vacation every year. They're beating us with one hand tied behind their back.

Why is Germany beating us? It's tempting to say it's because we beat them. After all, we helped put a major component of the German model in place, which is the role that German workers have in running their firms. After World War II, we had a problem: Who would keep watch over all the German businessmen who had supported Hitler? We couldn't put them all in jail. Back in that New Deal era, we and our allies were quite willing to put workers on the boards to keep an eye on businessmen. Still, the idea of works councils was not invented by Americans. In fact, it had its origins in Weimar Germany. And now Germany is the country, out of all countries, including Communist China, in which workers have the greatest amount of control over (dare I say it) the means of production.

Okay, it's not that much control. But it's enough to make the German system a rival form of capitalism. And because German workers are at the table when the big decisions are made, and elect people who still watch and sometimes check the businessmen, they have been able to hang on to their manufacturing sector. They have kept a tool-making, engineering culture, which our own entrepreneurs, dreamily buried in their Ayn Rand novels, have gutted. And now, thanks in large part to these smart structural decisions, Germany is not only competitive, it's rich. Although it's unlikely that even the most liberal of American politicians would ever use a phrase like "worker control"—much less describe people who work as "workers"—it might still be worth at least considering what would be involved in emulating the German model.

Let me here cart out the big three building blocks of German social democracy: the works council, the co-determined board, and Germany's regional wage-setting institutions. If I were teaching a class, I'd put these up on the blackboard and talk about them at the beginning of every class. "What do I mean by the German model? I'd like to see hands." No one knows. So I give the answer: "It's the works council, the co-determined board, and the wagesetting institutions."

Everyone in class groans. Whatever does that mean?

Well, the works council is simple in theory, though hard for an American to take in. Let's say you work at the Barnes & Noble at the corner of Clybourn and Webster avenues in Chicago. You may be just a clerk, no degree. (In Germany, you'd have a certificate in bookstore clerking, but in the United States there's no need.) Still, you could be elected to a works council at this store. That means you help manage the place. You help decide when to open and close the store. You help decide who gets what shift. On layoffs and other issues, the employer must reach an agreement with the works council. So you may ultimately decide whether Ms. X is to be laid off or fired. How did you get into this kind of "management"? Barnes & Noble had no say in it. You were elected by your fellow workers. You went out and campaigned: "Elect me."

The result is that there are thousands of clerks and engineers in Germany who now are (or a few years ago were) elected officials, with real power over other people. They are responsible for other people. They are responsible for running the firm. They make up a powerful leadership class that represents the kind of people—low-income, low-education—who don't have much of a voice in the affairs of other industrialized countries.

If that's a works council, what's a co-determined board? These apply mostly to the largest companies, those with more than 2,000 employees. We now leave behind the bookstore at Clybourn and Webster and try to imagine all of Barnes & Noble, the whole company. Way at the top, in the boardroom, where you expect to bump into Robert Rubin, the clerks get to elect half the board: not a fifth, not a third, but half—the same number of voting directors that the hedge funds get to elect.

Of course there's a catch! Under German law, if the directors elected by the clerks and the directors elected by the shareholders are deadlocked, then the chairman can break the tie. And who picks the chairman? Ultimately, just the shareholders. So capitalism wins by one vote, provided the stockholders, the bankers, and the kids from Goldman Sachs all vote in a single bloc. But the clerks still have a lot of clout. If the shareholders are divided on whether "A" or "B" should be the next CEO, the clerks get to pick the king. "A" is CEO but he owes his job to the clerks. By the way, the clerks have all this power without owning any shares! In this stakeholder model, they need only act on their interests as "the workers."

With works councils and co-determination, everything in the firm gets discussed, rather than the CEO going to the mountaintop without ever seeing a worker and deciding to pull the plug. "Wait," people say to me. "You mean co-determination keeps jobs from going abroad?" No, they can't stop a sale. They can't stop outsourcing. But they can cut deals. "Conditions—that is my motto," is how one worker-director put it in an issue of my favorite German magazine, Mitbestimmung. In the United States, people don't even know the plant is closing until management calls a meeting and ushers everyone out under armed guard. But in a German firm, the workers are Cato-like guardians, able to look at all of the financial records and planning documents as if they owned the place. If a company wants to start a plant abroad, the workers can pressure the board to plow some money back into a German plant or provide a ten-year employment guarantee. Or they can fight to get a better owner. It's not just the arguing: it's the fact that they can be in the boardroom watching, or in the back room rifling through the files. Doesn't your own behavior change when you think Cato is watching you? Well, it's true for managers too. That's why there is still a manufacturing sector in Germany.

Given the influence of the works council and a co-determined board, what remains for Germany's many powerful unions? They do the bargaining over wages and pensions but at a macro level, with a federation of all the big bookstores, not just Barnes & Noble but Borders as well. This is the German model of regional or multi-employer bargaining. We negotiated wages this way in the United States in the 1940s and 1950s, but no more. I doubt many Americans under forty even know what I mean by regional wage-setting institutions, and yet they are probably the single most important way in which Germany is "socialist."

This system is much in decline even in Germany, but it still has a huge egalitarian effect. The goal, never quite reached, is that every Barnes & Noble, every Borders, everywhere in the covered area, pays the same wage for the same type of work. Wages are not set person by person or shop by shop. They're the same, everywhere, as much as possible. The result, from an American perspective, is a shocking transparency: in Germany the ideal is that everyone knows what everyone else is making. By contrast, who knows what Barnes & Noble pays in Chicago, or Borders in Joliet? In the German system, people can find out what other people are getting, and their unions in turn can demand the same.

The private export sector is the most unionized part of the German economy (even more than the public sector). And it is understood to be the vanguard, the industry on the front lines of the global economy. So if the engineers at ThyssenKrupp get a 3 percent raise, then certainly the clerks should get a 3 percent raise. Soon everyone in Germany is getting 3 percent! In a complicated and limited way, the whole country can have a voice, if not a vote, in what takehome pay they receive. Unification with low-wage East Germany has made this leveling tougher, but people in Germany can still actually talk about "wage policy" and "wage objectives." There's a national conversation, unknown here, as to how much everybody should get.

All my life as a labor lawyer I have read the same thing in The Economist, about the United States and its wonderful labor-market flexibility. What they mean is: Unlike the Germans, U.S. working people are completely powerless. But it's precisely because of our labor-market flexibility that we can't compete. Our workers have been flexed right out of their high-wage, high-skill jobs and into low-wage, low-skill jobs. That's bad for the workers, of course, and it's also bad for the economy. The German model—with worker control built into the very structure of the firm—keeps bosses and workers in groups, rubbing elbows with each other, and sometimes just elbowing. It creates a group interaction that over time builds and protects what economists like to call human capital, especially in engineering and quality control. It's precisely this kind of valuable capital that our atomizing "flexible" labor markets are so good at breaking up and dispersing.

Yes, there's much to like about the U.S. model. In global competition, the United States has almost every comparative advantage over Germany. We spend vastly more on basic research than the Germans do. We have much more land, more labor, more capital, much higher levels of formal education. But with our flexible labor markets we cannot develop human capital or knowledge to wean ourselves away from turning out crap and leaving the high-skill manufacturing to the Europeans. The one great comparative advantage of Germany is that it is a social democracy. Germany has its problems, and I take them seriously. But I'm also sure that German companies will lead the next industrial revolution, the "green" one, while we in the United States will merely watch.

If you ask most Democrats and their think-tank minions how to help our powerless middle class, they have no answer except to send even more of them to college, where with luck they get out being only $50,000 or so in debt. As for the high school graduates who make up the base of the party, we effectively tell them: You're finished. There's no role for high school graduates in our version of the global economy. In Germany, these same high school graduates could be sitting on a corporate board. Skeptical readers will say: Oh, but that's Europe, it's socialism, something like that is not possible here. I think it's quite possible.

I now have stopped underlining and re-reading Wolfgang Streeck's great 1996 essay, "German Capitalism: Does It Exist? Can It Survive?" Still, I recall his central, disheartening point that the German model, with its works councils and the rest, was simply too hard to replicate in other countries. In the end, global capitalism would force Germany itself into our simpler, top-down Anglo-American model.

But it turns out, at least in the European Union, that other countries are now keen on experimenting with co-determination and works councils. "Co-determination is our biggest export," a former official in the German government told me. As it spreads through Europe, we may come to understand the German model as not just a rival but a better form of capitalism. It only takes a change in law. Maybe we'll decide one day, simply out of patriotism, that we have no other choice.

Is it likely? No. Is it possible? Yes. At any rate, it's just nonsense that "Europe's way" and "our way" can never be the same. We may have messed up our part in globalization, but we still have time to fix things. It may be even easier in this wired world to exercise our greatest privilege as Americans—to astonish ourselves by being American and making a European idea of democracy our own.

Thomas Geoghegan, a lawyer in Chicago, is the author of many books, including Which Side Are You On? and Were You Born on the Wrong Continent? which will be published this summer by New Press. His most recent article for Harper's Magazine, "Infinite Debt," appeared in the April 2009 issue.

Were You Born on the Wrong Continent?

How the European Model Can Help You Get a Life

BY THOMAS GEOGHEGAN

THE NEW PRESS / AUGUST 10, 2010

“A passionate case for the high-tax, regulation-heavy model of life on the Continent….the narrative unspools in a chatty, anecdotal style; it’s jumpy, appealingly digressive, and winning.”
—Publishers Weekly

There’s been a lot of throwing around of the term “socialism” by critics of President Barack Obama, who has been maligned as a European socialist by conservatives even though his administration’s agenda isn’t close to that of a European social democracy. But if you really think about it, perhaps we would be happier in cozy Germany or France, where there is a socialist-type government to catch us, than in the wide-open, free-fall United States.

This was exactly what was on Chicago labor lawyer and author Thomas Geoghegan’s mind as he began to sneak out of his workaholic American life to see what life is like in Europe. Were You Born on the Wrong Continent? is his report to his fellow captives here in the U.S. It’s not just that European social democracy is “nicer.” It’s not just that, under European-type socialism, many of us would perhaps be happier. It may be that only with some form of it can our own country, with its ballooning trade deficit, globally compete—or even just keep going without repeated financial crashes and crack-ups. High-wage Germany, which offers the most bottom-up worker control of any European country, nearly ties with China as the leading exporter in the world, well ahead of the United States. But in China and America we work until we drop while in Germany, they take six weeks off a year (with a shocking number of four-day weekends along the way). It’s not just that the Germans can outcompete us, but they seem to be doing it with one hand tied behind their backs.

Geoghegan focuses much of the book on Germany, a country that explodes the myth that European socialism invariably leads to anemic economies and persistently high unemployment. Using Germany as a model, he argues the middle class is the real beneficiary of European social democracy—its members reap free education, free child care, free nursing home care, guaranteed vacation time, and generous unemployment payments—while their white-collar American counterparts struggle to pay for the same. What drives our economy in the U.S. and inflates our GDP actually makes our lives less comfortable.

A wry, timely book, Were You Born on the Wrong Continent? helps us understand why the European model, contrary to popular neoliberal wisdom, may thrive well into the twenty-first century without compromising its citizens’ ease of living—and may just be the best example for the United States to follow. Think of it as a patriotic act to pick up Were You Born on the Wrong Continent? and learn from these other countries—perhaps some measure of personal happiness will be an inadvertent result.

About the Author

Thomas Geoghegan received national attention when he ran as a progressive candidate for Rahm Emanuel’s congressional seat in 2009 (and was endorsed by Barbara Ehrenreich, James Fallows, Thomas Frank, James K. Galbraith, Hendrik Hertzberg, Alex Kotlowitz, Sara Paretsky, Rick Perlstein, Katha Pollitt, David Sirota, Garry Wills, and Naomi Wolf, among others). He is a practicing attorney and the author of several books, including Which Side Are You On?, which was a finalist for the National Book Critics Circle Award and received a special citation from the PEN/Martha Albrand Award judges, In America’s Court, and See You in Court. Geoghegan has written for The Nation, the New York Times, and Harper’s. He lives in Chicago.

The American Economy: In Search of a Bubble

by John Lawrence

The American version of capitalism has lurched from one bubble to another. The housing bubble of 2007 almost brought the world economy another Great Depression. That was preceded just a few years earlier by the dot.com bubble of 2000. Both of these bubbles were asset bubbles having to do with the financialization of the US. Preceding bubbles had more to do with technological innovations although the dot.com bubble was both a technological innovation - the internet - and a stock market bubble. The prosperity of the Clinton administration in the 90s probably had a lot to do with the computerization of America and now that that has been completed, the computer has taken the place of many people formerly in the work force.

The recent financial crisis was similar to the run on the banks of the Great Depression. This time the crisis was in the unregulated banking sector - hedge funds, mortgage backed securities, credit default swaps and other non-regulated exotic instruments. The non-regulated part is important because that is what made the last asset bubble similar to the Great Depression according to Paul Krugman, author of "The Return of Depression Economics and the Crisis of 2008."

Earlier bubbles had to do with railroads in the 19th century, automobiles, radio and movies in the early 20th century and TV in the post war years. As long as there was something new in a technological sense on the horizon, economic activity with plenty of jobs was sure to follow. Arguably, the slowdown in bubble creation produced the joblessness of the 1930s. The trouble right now is that there isn't another bubble, technological or financial, on the horizon that would engage workers in the productive process. Lacking jobs, workers lack the ability to consume so productive assets remain idle. American GDP is consumption based. About 70% of GDP is consumption - people buying stuff. A lot of this stuff they don't really need, but it spurs economic activity anyway.

Businesses are poised to produce more products; they just don't have buyers for their products, and, even if they did, they won't necessarily hire more workers because robotization, computerization and automation are capable of turning out the produvcts with little necessary human labor. What labor is necessary has been outsourced to China and India so that an increase in demand just because more money is placed in consumers' hands by tax cuts or government checks or subsidies won't create many jobs in the private sector. So what you have is essentially unlimited capacity for production but not too many consumers consuming because the middle class has lost jobs, houses to foreclosure and is drowning in credit card and student loan debt.

Even Alan Greenspan admits that the rich have increased their riches throughout the recession while the middle class has been pummeled. According to him the rich have stepped up to the plate increasing their consumption which accounts for the modest increase in GDP. They are doing their patriotic duty so to speak picking up for the middle class's failure to consume. One might ask what kind of a world is this where those who don't need to consume because they have so much already are asked to consume in order to improve the economy? And that same fundamental question should surely be asked on a world wide basis when a billion people around the world don't even have the basic necessities of clean water, adequate food and sanitation. If this is how capitalism allocates resources, there is something missing.

Alan Greenspan speaking on Meet the Press today went on to say:

Former Fed Chairman Alan Greenspan said that the push by congressional Republicans to extend the Bush tax cuts without offsetting the costs elsewhere could end up being "disastrous" for the economy. In an interview on NBC's "Meet the Press," Greenspan expressed his disagreement with the conservative argument that tax cuts essentially pay for themselves by generating revenue and productivity among recipients. "They do not," said Greenspan. "I'm very much in favor of tax cuts but not with borrowed money and the problem that we have gotten into in recent years is spending programs with borrowed money, tax cuts with borrowed money," he said. "And at the end of the day that proves disastrous. My view is I don't think we can play subtle policy here."

He might also have said "war with borrowed money." So conservative economist, free market advocate and Ayn Rand acolyte Alan Greenspan is now contradicting one of the fundamental tenets of conservative Republican philosophy. Has he gone bonkers? While Republican politicians maintain that tax cuts and war do not have to be paid for, Greenspan has gone out of his way to maintain the opposite. Maybe it's just that Greenspan has realized the error of his ways and come to his senses.

It is becoming increasingly obvious that the main problem is jobs and that, until there is another asset bubble, American capitalism is in deep trouble because it is incapable of providing them in periods where there is little technological innovation. This leaves the middle class dangling from the end of a rope while politicians try to get small business and start-ups to provide the jobs. I guess they've given up on big business providing them as it's a foregone conclusion that big business has outsourced all their jobs.

That leaves only one avenue to provide jobs, an avenue that Obama won't go down for fear of being called a socialist. Well, he's already called a socialist for attempting to provide modest improvements in the calamity of capitalism that his predecessor created. That avenue is direct government investment in the economy similar to what FDR did with the Works Progress Administration. FDR was called a traitor to his class for providing jobs by direct government intervention in the economy. But he took on the "economic royalists" as he called them. Obama doesn't have the stomach to do that.

So as the middle class languishes and the Obama Presidency is unable to muster the chutzpah to provide government created jobs since the private sector is incapable of doing it, when it comes time to throw the bums out as the electorate is sure to do, we will see instead of a slow trickle of middle class people falling into poverty, an absolute torrent of people being swept off the middle class boat as the Republicans accelerate their agenda of increasing the wealth of the already wealthy. I think that's what's in store for the US come this fall with the mid-term elections. And by the way the Republicans and the libertarians will disavow Greenspan, that heretic. Ayn Rand must be rolling over in her grave. One can only hope that the middle class will wake up and give Obama a mandate much as they gave to FDR, a mandate that will get public investment and in the process robust job creation moving again, and perhaps it can be paid for by ending the war in Afghanistan. What they are all missing is that public investment in 21st century infrastructure by the government is likely to be followed by private investment taking advantage of that infrastructure. In the process a lot of jobs could be created.

Why the US Economy Won't Create Many New Jobs Unless It Adopts an Industrial Policy

by John Lawrence

It's taken as an article of faith that over time the US will not only pull out of a recesssion but that new jobs will be added reducing the unemployment rate back down to an "acceptable" 5%. But what if this doesn't happen? Long term unemployment in the US is greater than it has ever been. There are five applicants for every job. Why should anyone expect a return to the good old days especially given the dynamics of present day economic life? Manufacturing jobs as a percent of total payroll employment have declined significantly from 26.5% in 1969 (more than 1 out of every 4 jobs was in manufacturing) to the lowest-ever level of only 9.25% (about 1 in 11 jobs is in manufacturing) in March 2009. Meanwhile, jobs have been sent overseas to China and elsewhere because labor costs are cheaper there. Besides by now the US has lost so much job infrastructure and China has gained so much that the natural thing to do is to tool up a new factory in China where they have the know-how and not in the US where manufacturing skills are rusty and depleted.

In the good old days the US extracted raw materials from Latin America and elsewhere using cheap local labor. You could say that American companies exploited Latin American labor, and I would not disagree. The raw materials - tin from Bolivia, copper from Chile, oil from Venezuela, coffee from Columbia, bananas from Honduras - were shipped back to the US and processed and turned into manufactured goods here using higher priced American labor. Then they were sold to American consumers who had money to buy the goods since they were employed in rather well paid, unionized manufacturing jobs.

Now the situation is different. Instead of using high priced American labor, the manufacturing process takes place in countries, namely China, where labor costs are low and the finished products are imported into the American market by transnational corporations. Meanwhile, Latin American countries have gotten control of their own natural resources and have started to not allow transnational corporations to exploit them. Instead, they are being used for the profit and benefit of their own people. By putting the profits from these resources into the hands of their own citizens, they are starting to create consumer societies of their own. Despite years of American power being used to control political regimes in Latin America including the overthrow of democratically elected regimes, these natural resources are finally being controlled for the benefit of indigenous people. I'll just mention the CIA controlled overthrow of Salvador Allende in Chile in 1973 and the overthrow of Guzman in Guatemala in 1954 as examples of democratically elected heads of state who were ousted by the US because of their socialist (i.e. using their resources for the benefit of their own people) tendencies. These among others were US attempts to keep Latin American natural resources firmly in the hands of US corporations with the indigenous people just being used as a source of cheap labor and not profiting from their own wealth.

But in the last 10 years, the US has taken its eye off the ball in Latin America due to its preoccupation in Iraq and Afghanistan with the result that Hugo Chavez in Venezuela, Evo Morales in Bolivia, Lula da Silva in Brazil and others have started the quest for Latin American autonomy and solidarity and started to end US domination for the benefit of US corporations. The history of Latin American oppression is detailed in the book Open Veins of Latin America by Eduardo Galeano which is the book Chavez gave to President Obama. The coming to power of Chavez, Morales and da Silva in a sense is the culmination of the attempts by Allende, Guzman and others to bring Latin American resources under Latin American control.

But I digress. Suffice it to say that the old model of importing cheap natural resources to the US where manufactured goods were produced and then exported or consumed locally is history. The new model is importing manufactured goods into the American market where it is hoped that they will be sold. The fly in the ointment with this model is that Americans need the means to buy the imported goods and that means jobs, but these jobs have fled to China and elsewhere where labor is the cheapest. As countries gain control of their natural resources, the labor for extracting those resources can no longer be exploited, and, therefore, the labor that goes into the manufacturing process is now the locus of exploitation. Meanwhile, as US jobs diminish, US citizens are not able to consume as voraciously as they did previously and GDP decreases. Henry Ford paid his workers $5 a day, an outrageously high amount in those days, because he wanted his workers to have the purchasing power to buy the products that he was selling. This is the whole issue in a nutshell right there. That lesson seems to be lost on the US of today as workers' wages are stagnating if not diminishing, and they no longer have the purchasing power to sustain consumption at the rate of 70% of GDP.

American companies are sitting on record amounts of cash rather than creating new jobs by expanding production. The reason is that the market is already saturated. They don't need new workers. They can't sell the products that they are capable of producing with the workers they have now. Robotization and automation have reduced their need for workers. Companies will tend to hire where labor is cheapest and that means they won't be doing the bulk of their hiring in the US. As long as they can continue to import into the US market from abroad without tariffs, they will continue to do so because this maximizes their profits.

So what to do about American workers who need jobs as a source of income in order to pay for mortgages, food and other necessities? Reaganomics clearly won't work because lowering taxes on corporations and businesses clearly won't get them to create new jobs especially in the US. They are already sitting on record amounts of cash which could be used for investment. They don't need tax breaks from the US government in order to get the cash to invest. Venture capitalists also have huge amounts of money to potentially invest due to the financialization of the US and the huge increase of wealth for the upper 1%. They don't need to gain any more by means of tax reductions. Inequality of income and wealth are already at record levels.

Keynesian economics is also unlikely to produce permanent jobs. The idea behind Keynesian economics is that the government should deficit spend in order to get money into the hands of jobless workers so that their spending can stimulate the economy thus creating jobs. The problem with this is that the stimulation, while alleviating the pain of jobless workers through unemployment insurance and other means which is good in and of itself, is not creating permanent jobs as the Obama administration is finding out. When the stimulus is ended, the economic activity created by it dries up creating the need for perpetual stimulus and thus never ending deficits. Stimulus, while helpful temporarily and while it's the humanitarian thing to do to help the unemployed, is not translating into sustained economic activity.

Therefore, the government must do more than merely stimulate the economy. The government must get involved in creating sustainable industries rather than just putting money into consumers' hands and hoping that this will stimulate sustainable job creation by existing businesses. In short the government must develop an industrial policy. The government needs to get involved in the creation of industries that can provide sustainable jobs that won't be outsourced. This does not mean that the government has to be hiring the workers and paying them itself. If the government provides seed money much as a venture capitalist would, then private enterprise can do the actual business of creating jobs and paying workers. Is this socialism? I hardly think so. The alternatives are not big government or small government. The alternatives are laissez faire capitalism which as you may have noticed is not working and a form of capitalism which you may have noticed is working better in other countries.

China, for example, is sitting on a pile of cash. In fact they are the US' chief creditor. They are actively involved in steering their economy and thus creating jobs. They don't, however, micromanage the whole economy. They leave that to various privately run enterprises which are in it for the money, the moola, the profit motive. The Chinese government just manages the commanding heights of the economy. This does not mean that they own the commanding heights of the economy which is what socialism represents. What the Chinese form of authoritarian capitalism really represents is that the Chinese government is actively involved in pursuing the interests of the Chinese economy and hence the Chinese people absent presently a welfare role as in the European model. This fact and the absence of any industrial policy in the US is the reason why China is eating the US' lunch.

Europe is another example where government is actively involved in pursuing the interests of the economy without controlling or being involved in every aspect of it. (See Europe's Promise by Steven Hill.) Rather than a "welfare" economy, the European economy can be more accurately described as a "workfare" economy. They will do everything possible at the governmental level to create jobs and get people employed in the private sector. Storefront government employment agencies bend over backwards to find people jobs. The whole idea is to get people in the position of becoming productive members of society thereby increasing tax revenues and diminishing welfare payments. For those who can't be employed for any reason, Europe provides generous welfare benefits (this is the the main difference between Europe and China insofar as the economy is concerned), but the primary impetus is to get people employed.

Many other countries including Japan with its Ministry of International Trade and Industry have government level industrial policies. Public-private partnerships can kick start industries which are capable of providing sustainable jobs. It's obvious which industries need to be created: green energy, infrastructure rebuilding, high speed rail, a modernized electrical grid, hardened and secure computer systems among others. For some reason private enterprise is not willing or able to create large scale industries employing American workers in these fields. Instead other countries are stealing a march on the US. A cabinet level department of trade and industry would oversee import and export policy, seed start-up industries, maintain a jobs policy in the interests of American citizens and seek to accumulate a surplus rather than a deficit for the American government which was funded in its early years solely by the money it made from tariffs and not by an income tax.

In conclusion, waiting around for the US economy to "recover" is bound to be a policy of failure. Stimulating the economy through giving consumers money to spend into the economy (Keynesianism) will only produce a temporary stimulus with ongoing deficits. Lowering taxes (Reaganomics or supply side economics) will only add to the balance sheets of large corporations since they are already sitting on piles of cash. The government must get actively involved in creating self-sustaining industries of the future in order to compete with other countries whose governments are actively involved in creating those industries and in looking out for the employment and well being of their citizens.

Venezuela to Nationalize US-Owned Oil Rigs

Published on Thursday, June 24, 2010 by Al-Jazeera-English

Venezuela has said that it will nationalize 11 oil rigs owned by a US company.

The takeover of the rigs, owned by the Helmerich and Payne oil firm, is the most recent move in a program of nationalization as part of the socialist 'Bolivarian revolution' of Hugo Chavez, the president.

Chavez's socialist revolution has led to banking and power assets being nationalised. Rafael Ramirez, the Venezuelan oil minister, said on Thursday that the facilities were being taken over to bring them back into production. (AFP)

The rigs have been out of use for months due to a dispute over payments by PDVSA, the state oil company.

Helmerich and Payne, which owns other rigs in the country, had said that it would not work at the sites until they were paid the $49 million it was owed. It did not immediately comment on the planned nationalization.

Rafael Ramirez, the Venezuelan oil minister, said on Thursday that the facilities were being taken over to bring them back into production.

'Weakening government'

Ramirez said that firms like Helmerich and Payne who had refused to put their rigs into production were aiming to weaken the government.

"There is a group of drill owners that has refused to discuss tariffs and services with PDVSA and have preferred to keep this equipment stored for a year," he said.

"That is the specific case with US multinational Helmerich and Payne."

Venezuela has suffered a reduction in oil output since 2008.

Despite having significant oil reserves the country is undergoing economic struggles, with power shortages and low food resources affecting Chavez's promises to pull people out of poverty.

His government has nationalized telecommunications, power and steel firms during the last three years.

The government also nationalized Banco Federal, a mid-sized bank, last week giving the state control of 25 per cent of the banking sector.

Legislative elections are to be held in September and Chavez needs to reverse popularity losses due to Venezuela's recession before then

Oil-giants such as Halliburton, Schlumberger and Baker Hughes also work in Venezuela, although the former pair have avoided public disputes with the government.

© 2010 Al-Jazeera-English

European Capitalism Superior to American Capitalism?

How Europe Avoided an Economic Crisis that is Anywhere Near as Bad as Ours

By Richard Clark (about the author)  

Published by OpEdNews.com, May 1, 2010 at 08:16:21

What follows is a synopsis of an article by Steven Hill that recently appeared in The Nation -- http://www.thenation.com/doc/20100510/hill. That article was adapted from Hill's eyeopening recently published book, Europe's Promise: Why the European Way Is the Best Hope in an Insecure Age. (http://www.europespromise.org/).

Contrary to what rightwing American critics would have us believe, Europe has the largest economy in the world, producing nearly a third of the world's GDP. Indeed, its economy is almost as large as those of the United States and China combined. Europe has more Fortune 500 companies than the United States and China put together, and Europe had a higher per capita growth rate from 1998 to 2008 than the United States. Long denigrated by US pundits as the land of high unemployment, the EU currently even has a slightly lower unemployment rate than the United States. Indeed, the World Economic Forum in 2008-09 ranked Denmark, Sweden, Finland, Germany and the Netherlands among the top ten most competitive economies in the world. They are also ranked at or near the top of most lists for quality of life, health care and social benefits. That's not a coincidence, since the participation of workers on all corporate boards of directors allows for both economic vibrancy and more egalitarian social policy. And while the United States also ranks high in competitiveness, it is near the bottom among most-developed countries in health care, social benefits and quality of life.

Sweden, Germany and other European countries are proof that you can have it all -- but only if you have the right institutions to facilitate both a powerful economic engine and the supportive institutions and benefits to harness that engine and keep employees and families healthy and productive. These distinctly European advances may be the most important innovations in the world economy since the invention of the modern corporation, since they encourage free enterprise combined with economic democracy and worker consultation that does not unduly burden entrepreneurship and commerce. The advances allow businesses to be both competitive and socially responsible.

In effect, Europe has reinvented the corporation. Yet the latest critiques of capitalism by leading authors like Naomi Klein, Noam Chomsky and the producers of the popular film The Corporation tend to view all corporations and all capitalisms as the same. American progressives, while searching for effective responses to globalization, appear to be mostly unaware of these intriguing European inventions. Movements to revoke the charters of offensive corporations, while having gut-level appeal, have failed to recognize that European corporations are fundamentally different animals from their "disaster capitalism" US counterparts.

Now, a year and a half after an economic earthquake shook the world, new economic models are beginning to find traction in America. Alternatives to Wall Street capitalism, the epicenter of the temblor, are suddenly getting a new hearing in the United States, whether it's Paul Volcker calling for reinstatement of Glass-Steagall regulation of the banking sector, the United Steelworkers announcing an alliance with the Mondragon cooperatives in Spain to develop manufacturing cooperatives in the United States, or Cleveland-based efforts to establish worker-owned co-ops in distressed communities [see Alperovitz, Howard and Williamson, "The Cleveland Model," March 1, in The Nation].

If Americans want to learn about cooperatives, Europe is a great place to start.Those co-ops produce an estimated 12% of the GDP of the European Union and involve, directly or indirectly, at least 60% of the population. Besides the Mondragon co-ops in Spain, in which 256 companies employ 100,000 people in industry, retail, finance and education, there's also Coop Italia, which operates the largest supermarket chain in Italy, employing 56,000 with more than 6 million members; housing co-ops like Poland's TUW; and the Co-operative Group in Britain, which is the world's largest consumer-owned business, with 4.5 million members.

In Europe, practices unfamiliar to Americans, such as co-determination, supervisory boards and works councils, have been crucial in helping to harness capitalism's tremendous wealth-creating capacity so that its prosperity is broadly shared.

Co-determination has several features, one of which allows workers to elect representatives to corporate boards of directors known as supervisory boards. Supervisory boards then oversee company managers, who handle day-to-day operations. In Germany, the world's second-largest exporter and fourth-largest national economy, fully half of the boards of directors of the largest corporations -- Siemens, BMW, Daimler, Deutsche Telekom and others -- are elected by workers. In Sweden, one-third of a company's directors are worker-elected. To understand the significance of this, imagine if Wal-Mart were legally required to allow its workers to elect a third to half of its board, who would then oversee the CEO. Imagine how much that would change Wal-Mart's behavior toward its workers and supply chain. It's hard for Americans even to conceive of such a notion; indeed, when I ask Americans at my lectures how many of them have heard of worker-elected supervisory boards, usually no hands go up. Yet most European nations employ some version of this as a regular feature of their economy.

Co-determination means that elected worker directors should sit side by side as equal decision-makers with stockholder representatives, supervising management, is a little-known yet unprecedented extension of democratic principle into the corporate sphere.

Research shows that employee representation on corporate supervisory boards, contrary to fears that it would cause tension or render decision-making too cumbersome, has actually fostered cooperation between management and workers. This, in turn, has benefited the businesses as well as the workers. Workers have input, even into important decisions, so companies are less plagued by labor strife and internal schisms. And workers are well compensated, with high salaries and the most generous social support systems in the world.

One study of Swedish businesses found that two-thirds of executives viewed co-determination as "very" or "rather" positive, because it contributed to a positive climate, made board decisions "deeply rooted among the employees" and facilitated implementation of "tough decisions." Eight of ten chairmen were satisfied with the arrangement and felt it was not important to reduce worker representation. An EU directive establishing a continent-wide framework for board-level employee representation went into effect in October 2004, firmly rooting supervisory boards in Europe's economic culture.

The other pillar of co-determination is known as works councils, which are just what the name implies -- elected councils at businesses, through which employees gain significant input into working conditions. Works councils, which are separate from labor unions but often populated by trade unionists, have real clout. They enjoy veto power over certain management decisions pertaining to treatment of employees, such as redeployment and dismissal. They also have "co-decision rights" to meet with management to discuss the firm's finances, work and holiday schedules, work organization and other procedures. In addition, they benefit from "consultation rights" in planning the introduction of new technologies and in mergers and layoffs, as well as in obtaining information useful in contract negotiations, such as profit and wage data. In some nations, including Germany, Sweden and France, works councils have acquired even more rights and greater influence.

German law stipulates that factory-wide workers' assemblies must be held at least four times a year, at which a management representative must report on the plant and the business. The head of the works council also reports, and workers use these assemblies to promote their views and, if necessary, criticize company decisions in front of management.

In 1994 the EU issued a pioneering directive on works councils, stipulating that every multinational with at least 1,000 workers, and at least 150 workers in two or more EU nations, must negotiate agreements with works councils. Other nations have supplemented that directive by requiring councils in every workplace. Studies by Princeton's Jonas Pontusson and others have concluded that works councils contribute to efficiency by improving communication, which in turn improves the quality of decisions and legitimizes decisions in the eyes of workers. The studies also found that works councils are associated with lower absenteeism, more worker training, better handling of grievances and smoother implementation of health and safety standards. It turns out that when workers are given a degree of consultation, it makes them more satisfied and more productive.

In Germany works councils and supervisory boards can take substantial credit for the fact that, while the US unemployment rate has more than doubled during this economic crisis, Germany's has barely increased. That's because Chancellor Angela Merkel was heavily influenced by works councils and labor unions, and by the culture of consultation in general, to adopt a policy called Kurzarbeit, or "short-time work," in which, instead of laying off millions, employees agreed to spread the pain by working shorter weeks. Most of the lost wages have been made up from a special fund squirreled away during more prosperous times. As a result, more Germans have money in their pockets, and communities and households haven't been decimated by layoffs like they have been in the United States. (Despite the advantages, when Larry Summers, one of Barack Obama's closest economic advisers, was asked why the president didn't pursue short-time work to stem the economic bleeding, he dismissed the idea, saying the White House wanted to create new jobs, not preserve old ones.) But of course there's absolutely no reason why we couldn't do both!

Co-determination has proved crucial to Europe's economic success and its broadly distributed wealth. The practical effect of co-determination is that corporate managers and executives must confer extensively with employees and unions about a range of issues, even about the future direction of the company. Co-determination reflects European "socialized capitalism," with its communitarian values, long-term strategic vision and emphasis on manufacturing, much the way huge executive bonuses, quarterly earnings and a bloated financial sector reflect America's Wall Street capitalism. Socialized capitalism has both produced and benefited from the culture of consultation, which has also contributed to the creation of cooperatives and resulted in a vibrant small-business sector that produces two-thirds of European jobs, compared with only half of US jobs.

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Let's follow the European example

The People's Republic of North Dakota

by John Lawrence

During the recent economic meltdown in which most states are running huge budget deficits and experiencing large scale unemployment, one state flourished. It had the nation's lowest unemploymewnt rate - about 4% - and one of the largest budget surpluses - more than $1 billion. What state is this that's so out of synch with the debt and unemployment ridden rest of the nation? The Socialist People's Republic of North Dakota. Since 1919 North Dakota is the only state in the nation that has a state run bank - the Bank of North Dakota (BND). Unlike other banks, the BND plows about half its profits into the state budget. Imagine? An institution at the heart of capitalism supporting the government! Why it's absolute heresy. Socialism of the first order. State capitalism.

The Governor of North Dakota is the chairman of the bank. Government and capitalism in cahoots! Sounds like the People's Republic of China to me. The Governor appoints a seven member advisory board for the bank. Collusion! All banks should be privately owned and just seek the highest profits for private coffers, right? Instead the BND plows its profits back into the state itself and kept credit flowing to North Dakotans during the Great Recession something the big banks on Wall Street have been reluctant to do. The BND even offsets taxes, paying for infrastructure and other public projects - $350 million worth since 1997.

Other states are looking into this. If socialism is good enough for North Dakota and keeps taxes low, the states of Hawaii, Florida, Oregon and Washington want to know if this might work for them too. It's about providing the most services to people at the least possible cost. What's that you say? Socialism keeps taxes low and provides social services? How can that be possible? I thought capitalism was supposed to do that. Oh, I guess capitalism is only supposed to get and keep private individuals and corporations rich while sucking blood out of the public. Sort of like Wall Street's giant blood sucking vampire squid.

North Dakota is doing - right in the middle of American capitalism - what many other countries are doing including China, Norway and Saudi Arabia - essentially establishing a sovereign wealth fund and a mini-Federal Reserve. The idea that the state should be in the business of accumulating wealth instead of debt and then spending that wealth in such a way as to profit the public instead of private investors is an idea whose time has come. It's worked for North Dakota. Maybe it will be coming soon to a state near you!

Here's an article from Huffington Post:

(AP) The Bank of North Dakota - the nation's only state-owned bank - might seem to be a relic. But now officials in other states are wondering if it is helping North Dakota sail through the national recession. Gubernatorial candidates in Florida and Oregon and a Washington state legislator are advocating the creation of state-owned banks in those states. A report prepared for a Vermont House committee last month said the idea had "considerable merit." Liberal filmmaker Michael Moore promotes the bank on his Web site. "There's a lot of hurt out there, a lot of states that are in trouble, and they're tying the Bank of North Dakota together with this economic success that we're having right now," said the bank's president, Eric Hardmeyer. Hardmeyer says he's gotten "tons" of inquiries about the bank's workings, including questions from officials in California, Michigan, New Mexico, Ohio and Washington state. North Dakota has the nation's lowest unemployment rate at 4.4 percent, soaring oil production and a robust state budget surplus - but Hardmeyer says the bank isn't responsible for the prosperity. "We are a catalyst, perhaps, or maybe a part of it," he said. "To put this at our feet is flattering, but it frankly isn't true." The Bank of North Dakota serves as an economic development agency and "banker's bank" that lessens the loan risks of private banks and helps them finance larger projects. It offers cheap loans to farmers, students and businesses. The bank had almost $4 billion in assets and a $2.67 billion loan portfolio at the end of last year, according to its most recent quarterly financial report. It made $58.1 million in profits in 2009, setting a record for the sixth straight year. During the last decade, the bank funneled almost $300 million in profits to North Dakota's treasury. The bank has the advantage of being the repository for most state funds, which can be used for loans and occasional relief for private banks that need a jolt of cash during sluggish credit markets. "We think of ourselves as kind of a little mini-Federal Reserve," Hardmeyer said. The state earns roughly 0.25 percent less interest than state agencies would get from a commercial institution. The bank also pays no state or federal taxes and has no deposit insurance; North Dakota taxpayers are on the hook for any losses. The Bank of North Dakota was a cornerstone of the agenda of the Nonpartisan League, a farmers' political insurgency spawned by anger about outside control of North Dakota's credit and grain markets. Founded in 1915 by A.C. Townley, who became a Socialist Party organizer after he went broke raising flax in western North Dakota, the NPL advocated state-owned banks to provide low-interest farm loans, along with state flour mills, grain elevators, meatpacking houses and hail insurance. Supporters gained control of the legislature and the governorship within five years. The movement's power quickly waned, but two of its state-owned businesses survived - the Bank of North Dakota and a state flour mill and grain elevator in Grand Forks. From the 1940s until the early 1960s, the bank served mostly as a public funds depository and municipal bond buyer, said Rozanne Enerson Junker, author of a 1989 history of the bank. Its economic development activity has greatly expanded since. Gary Petersen, president of the Lakeside State Bank of New Town, a community on the Fort Berthold Indian Reservation in northwestern North Dakota, said the state bank is often willing to take a stake in local development projects. "In my experience, you make a contact with the (Bank of North Dakota), and their question is, 'How do we get this done?'" Petersen said. "They're not looking at ways to knock it down." Alerus Financial, a Grand Forks bank, has sold about $115 million of its $600 million loan portfolio to the Bank of North Dakota, both to spread its risk and provide itself with additional loan money, said Karl Bollingberg, Alerus' director of banking services. "If you're left to find other participating banks, that can be very challenging," he said. "They don't have the same interest that the Bank of North Dakota has in helping you to do deals." Mauro Guillen, a professor of management at the University of Pennsylvania's Wharton School of Business, said it is unlikely other states would open similar banks, in part because "the political culture here is very much against that kind of a thing." Some state and federal agencies, such as the Small Business Administration, already have economic development programs similar to those at the Bank of North Dakota, Guillen said. Bollingberg said the idea of other state-owned banks would also likely rouse opposition from private banks that wanted to keep their share of state deposits. "Because the (Bank of North Dakota) has been here so long, no banks know what it was like to have those deposits," he said. Hardmeyer said he, too, was always doubtful others would take up North Dakota's model, but now he's not so sure. "When I see what's going on around the country, it's not quite as far a leap as I thought it once was," he said.

No, not a leap at all when the rest of the world is doing it. Creating public wealth instead of public debt, that is. While the US government, most US state governments and most US municipal governments are deeply mired in debt and fast approaching insolvency, a model based on the public accumulation of wealth instead of the public accumulation of debt is looking mighty good right now. And it keeps taxes low and provides capital for private enterprise which should appeal to the majority of Americans. That's a Bonus Jack. A no brainer. Hoohaa as Al Pacino in Scent of a Woman said.

Nine Myths about Socialism in the US

Published on Saturday, April 10, 2010 by CommonDreams.org

by Bill Quigley

Glenn Beck and other far right multi-millionaires are claiming that the US is hot on the path towards socialism. Part of their claim is that the US is much more generous and supportive of our working and poor people than other countries. People may wish it was so, but it is not.

As Senator Patrick Moynihan used to say “Everyone is entitled to their own opinions. But everyone is not entitled to their own facts.”

The fact is that the US is not really all that generous to our working and poor people compared to other countries.

Consider the US in comparison to the rest of the 30 countries that join the US in making up the OECD – the Organization for Economic Cooperation and Development. These 30 countries include Canada and most comparable European countries but also include some struggling countries like Czech Republic, Greece, Hungary, Korea, Mexico, Poland, Slovak Republic, and Turkey. See www.oecd.org

When you look at how the US compares to these 30 countries, the hot air myths about the US government going all out towards socialism sort of disappear into thin air. Here are some examples of myths that do not hold up.

Myth #1. The US government is involved in class warfare attacking the rich to lift up the poor.

There is a class war going on all right. But it is the rich against the rest of us and the rich are winning. The gap between the rich and everyone else is wider in the US than any of the 30 other countries surveyed. In fact, the top 10% in the US have a higher annual income than any other country. And the poorest 10% in the US are below the average of the other OECD countries. The rich in the U.S. have been rapidly leaving the middle class and poor behind since the 1980s.

Myth #2. The US already has the greatest health care system in the world.

Infant mortality in the US is 4th worst among OECD countries – better only than Mexico, Turkey and the Slovak Republic.

Myth #3. There is less poverty in the US than anywhere.

Child poverty in the US, at over 20% or one out of every five kids, is double the average of the 30 OECD countries.

Myth #4. The US is generous in its treatment of families with children.

The US ranks in the bottom half of countries in terms of financial benefits for families with children. Over half of the 30 OECD countries pay families with children cash benefits regardless of the income of the family. Some among those countries (e.g. Austria, France and Germany) pay additional benefits if the family is low-income, or one of the parents is unemployed.

Myth #5. The US is very supportive of its workers.

The US gives no paid leave for working mothers having children. Every single one of the other 30 OECD countries has some form of paid leave. The US ranks dead last in this. Over two thirds of the countries give some form of paid paternity leave. The US also gives no paid leave for fathers.

In fact, it is only workers in the US who have no guaranteed days of paid leave at all. Korea is the next lowest to the US and it has a minimum of 8 paid annual days of leave. Most of the other 30 countries require a minimum of 20 days of annual paid leave for their workers.

Myth #6. Poor people have more chance of becoming rich in the US than anywhere else.

Social mobility (how children move up or down the economic ladder in comparison with their parents) in earnings, wages and education tends to be easier in Australia, Canada and Nordic countries like Denmark, Norway, and Finland, than in the US. That means more of the rich stay rich and more of the poor stay poor here in the US.

Myth #7. The US spends generously on public education.

In terms of spending for public education, the US is just about average among the 30 countries of the OECD. Educational achievement of US children, however, is 7th worst in the OECD. On public spending for childcare and early education, the US is in the bottom third.

Myth #8. The US government is redistributing income from the rich to the poor.

There is little redistribution of income by government in the U.S. in part because spending on social benefits like unemployment and family benefits is so low. Of the 30 countries in the OECD, only in Korea is the impact of governmental spending lower.

Myth #9. The US generously gives foreign aid to countries across the world.

The US gives the smallest percentage of aid of any of the developed countries in the OECD. In 2007 the US was tied for last with Greece. In 2008, we were tied for last with Japan.

Despite the opinions of right wing folks, the facts say the US is not on the path towards socialism.

But if socialism means the US would go down the path of being more generous with our babies, our children, our working families, our pregnant mothers, and our sisters and brothers across the world, I think we could all appreciate it.

Bill Quigley is Legal Director at the Center for Constitutional Rights and law professor at Loyola University New Orleans. There is a version of this article with footnotes for those interested. [email protected]

Bring Back the WPA

by John Lawrence

 

The Works Progress Administration (WPA) was a government funded jobs program that FDR instituted during the Great Depression to put people to work immediately. They did a lot of good things like build schools, roads, bridges - infrastructure in general. The very school that I attended as a young boy, Wantage Consolidated School, was built by the WPA. Furthermore, this WPA built school gave my father a job as principal so our family was a direct beneficiary of FDR's WPA. How's that for a testimonial? Although my father was a lifelong Republican, I never heard him refer to this as socialism which it would immediately be called if Obama was to propoae something similar in today's political climate.

 

The following was published on Friday, April 9, 2010 by The Huffington Post

Jobs We Can Believe In

by Deepak Bhargava

Today is the 75th anniversary of the Works Progress Administration, a $10 billion federal program that put millions of Americans to work during the Great Depression. The WPA enabled workers and their families to survive the ravages of the Great Depression, while taking on public works projects that created a sound foundation for greater economic growth.

Across the country, local organizations are holding events marking the anniversary and calling on Congress to pass legislation introduced by Rep. George Miller, D-Calif., that would put one million people to work almost immediately. The jobs created by the bill would help build schools and keep our streets safe, among other essential work in communities across America. The Local Jobs for America Act, which quickly gathered nearly 120 co-sponsors, is the best chance this country has to begin filling the massive shortfall in jobs that our economy is experiencing. (The prestigious Economic Policy Institute estimates that the economy is now nearly 17 million jobs short.)

Faced with the enormous unemployment created by the Great Depression, President Franklin Roosevelt and Congress acted decisively to get Americans back on their feet with real jobs, helping jump-start the economy. From LaGuardia Airport to Camp David to the Golden Gate Bridge, the legacy of WPA remains with us today. No matter where you reside, there are lasting testaments to the enduring legacy of infrastructure and rejuvenation created by the WPA.

We need the same type of bold investment to address the scale of our current crisis. The Local Jobs for America Act is an important first step. The Local Jobs for America Act will provide $100 billion over two years to create or save a million public and private sector jobs, extend critical support to local communities to maintain essential services, and fund private sector job training to help local businesses put people back to work. While the focus of the jobs created will be on education and other vital community services rather than infrastructure, the principle is the same: create meaningful jobs to meet public needs and provide long-term benefits for our communities and economy.

Congress and the Administration have failed to adequately address the needs in our communities and their efforts haven't been bold enough to make a dent in the enormous human disaster we face. Consider that almost 3.5 million people (a number higher than population of 21 entire states) have been unemployed for more than a year. That's a post-World War II record. Nor have efforts to date been targeted in a manner which can get the hardest hit communities back on their feet. It's important to note that the staggering 9.7% unemployment rate is even worse amongst some populations. Nearly 20 percent of African-American men are now jobless. The unemployment rate amongst Latinos is nearly 13 percent.

Franklin D. Roosevelt's bold actions to meet the challenge of economic crisis were founded on an important understanding that our present generation of leaders ought to heed on this important anniversary. Roosevelt understood that the depression was the product of government failing to live up to its obligations. Much like the Great Depression, the Great Recession grew out of the Republican leadership's decisions to block government oversight of markets and eschew any role for government in addressing persistent economic problems in communities across America. The failed policies of George Bush were not merely tactical mistakes - they were the fundamental product of an ideology that places greed above social responsibility.

Roosevelt's answer to all those who pronounced that every person should be on their own and that government does not have a role in creating mutual responsibility was simple and straight forward: "In our seeking for economic and political progress, we all go up -- or else we all go down." That's what a direct job creation program means: it recognizes that we are all in this together, and creating jobs in distressed communities benefits the nation and our economy as a whole.

On the anniversary of one of the most successful programs ever created by our government, we would do well to remember the notions of mutual responsibility and community values that underpinned its overwhelming success.

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Deepak Bhargava is Executive Director of the Center for Community Change, a national nonprofit organization whose mission is to develop the power and capacity of low-income people, especially low-income people of color, to change the policies and institutions that affect their lives.