This Is Barbarism
Over 100 years ago, in the midst of the death and destruction of the First World War, German socialist leader Rosa Luxemburg wrote that capitalist society was at a crossroads and would either “transition to socialism or regress into barbarism.” In the 1930s, fascist parties took over Germany and other countries, and they indeed descended into genocidal barbarism.
Today, in the center of western capitalism, the United States, the president, Republican senators, and major financial leaders are calling for an imminent return to business as usual that could kill millions — but at least temporarily save corporate profits.
This is barbarism.
The Evolving Crisis
There are now nearly half a million confirmed Covid-19 cases worldwide, with more than 40,000 confirmed cases in the United States quickly spreading in the South. Our caseload trajectory is rising faster than anywhere else in the world and could soon make the U.S. the center of the global pandemic.
The virus is ravaging New York’s healthcare system, and in Washington nurses describe their work as analogous to war: “You’re in a battlefield where supplies are limited. The help’s slow to get to you and there’s lots of casualties and … you can’t see the enemy.” Decades of neoliberal austerity have left most local governments and public health systems totally ill-equipped to handle the crisis.
50% of those who die from Covid-19 have dying from secondary bacteria infections, something Mike Davis warnedabout in his critique of big pharma’s drive for profits.
The FDA granted the pharmaceutical giant Gilead seven years of monopoly on its drug, remdesivir, a possible treatment for coronavirus. Gilead is already known for price-gouging life-saving HIV drugs.
Activists with Asian Americans Advancing Justice (AAJC) are sounding the alarm about an uptick in violent attacksagainst hundreds of Asian Americans, fueled by Trump’s racist rhetoric.
Stock markets are rallying as investors welcome the latest bailout package. But Fed officials predict unemployment figures as high as 30 percent, which will snowball the economic havoc that’s in store.
Across the country, we’re seeing murderous levels of neglect and inaction. With Trump pushing for a return to work by Easter, the new strategy is to starve workers to protect the profits of a few, risking the lives of millions in the process. New York Governor Andrew Cuomo announced plans to force workers back to work in the epicenter of the US outbreak while he recommended $400M in cuts to Medicaid.
The passing of the buck to state and local governments has resulted in wildly uneven responses across the country. This will only prolong the pandemic.
Democrats have reached a deal with the Trump White House on the largest stimulus package in history — $2 trillion, including $500 billion in corporate aid. Early reports indicate that Bernie succeeded in his fight to add improved unemployment support for workers. Bailouts may be in order, but they must be equitable and put people over profit.We must reject a repeat of the post-2008 corporate giveaway that lined capitalists’ pockets at the expense of workers!
Some local governments have pursued steps guaranteeing rent grace periods, eviction moratoriums, and other relief measures aimed at cushioning the blow for workers.
Joe Biden broke his week-long silence on Monday with bizarre and jumbled videos and interviews, displaying a lack of basic leadership capacity. Meanwhile, Donald Trump has seen his highest approval ratings as President, with a majority of Americans approving of his handling of the crisis. The leadership vacuum from anyone left of Trump shows why it’s more important than ever for Bernie Sanders to remain on the national stage. Bernie can retool his campaign to lead the charge against coronavirus and disaster capitalism as a surrogate for an absent workers’ party.
Workers Strike Back
The diverse working class is organizing like we’ve never seen — fighting to shutter nonessential businesses to stop the spread of COVID-19 while winning paid time off for workers. Essential workers in healthcare, logistics, transportation, and grocery are fighting to protect themselves and our whole society.
Healthcare: People are stepping up to donate medical supplies to hospitals. It may not be fully sufficient, but this mutual aid is an important and much-needed act of solidarity! East Bay DSA is hosting a digital townhall to hear from frontline healthcare workers in Oakland. Don’t miss it.
Transit: Following Detroit’s example, organized transit workers in Toronto and Alabama won rear boarding and free fares for riders to protect the public and the workers. Union taxi workers in Los Angeles have issued demandsranging from social distancing protocols to the expansion of SNAP for all essential workers.
Logistics: The presidents of two of the largest unions at Bath Iron Works on Tuesday called on the company to close and give employees paid leave for two weeks to protect the company’s 8,000 workers.
Grocery: Grocery workers in Berkeley won a $2/hour raise as hazard pay during the pandemic after gathering over a thousand signatures in their petition. H-E-B workers also won a temporary $2/hour hazard pay raise. Bosses at Kroger are so scared of workers organizing that they banned the website Labor Notes on their wifi. Check out the article that shook them up. Instacart is hiring hundreds of thousands of new workers to handle new demand for delivered groceries. We must support these workers in getting protection, support, and hazard compensation for this frontline work.
Agriculture: In Georgia, Perdue plant workers walked out in protest of their unsafe working conditions and lack of hazard pay.
Coffee Shops: After gathering over 24,000 signatures on a petition demanding the company close stores, Starbucks workers won.
We’re Fighting For the World
Like Rosa Luxemburg a century ago, democratic socialists are fighting for a just, equal, healthy, and environmentally sustainable world.
Under capitalism, private profit for billionaires drives our economy, our energy system, our government, and more. This profit is in effect stolen from the labor of millions of exploited, oppressed, overworked, and underpaid workers and from our environment. The pursuit of profit drives the privatization of energy, water, schools, transportation, and healthcare — driving the coronavirus pandemic to cause far more human suffering than it would otherwise. Profit drives the military and prison industrial complexes, the division of workers along the lines of race and nationality, and the devastation of our planet. Capitalism as a social system only benefits the already rich at the expense of everyone else.
Democratic socialism is the only cure to the disease that is capitalism. Workers—united across geography, ethnicity, gender, and age—are the ones who will win it.
In terms of potential deaths and the impact on our economy, the crisis we face from coronavirus is on the scale of a major war, and we must act accordingly. We must begin thinking on a scale comparable to the threat, and make sure that we are protecting working people, low-income people, and the most vulnerable communities, not just giant corporations and Wall Street.
Empower Medicare to Lead Health Care Response
This emergency agency, modeled after the Reconstruction Finance Corporation, will be empowered to cover affected businesses’ payroll, make zero percent loans and loan guarantees to businesses, finance new construction of factories, emergency shelters, and production of emergency supplies such as masks and ventilators, and create new jobs and economic development. This agency will provide all the necessary funding for fighting this economic crisis.
Our response to this health and economic crisis cannot be another money-making opportunity for corporate America and Wall Street. We need to establish an oversight agency to ensure no one is profiting off of the economic pain and suffering of our people in crisis.
Wow! Over 1180 people joined our COVID-19 People Over Profit Mass Call last night. You can watch the recording here.
Every day we hear more bad news, but there are also amazing stories of workers fighting back or people helping their neighbors. We’ll pull through if we pull together, and last night with you felt powerful.
As promised, here are critical links we discussed on the call.
Sign up to get our new DSA COVID-19 Bulletin several times a week.
Sign and share DSA’s COVID-19 Demands petition.
Register for an upcoming national Zoom organizing call.
Sign up to get advice on organizing with your co-workers during the COVID-19 crisis.
Join DSA if you’re not already a member, become a monthly member if you’re not already, or ask 3 of your friends to join.
DSA National Director
Join us this Thursday, March 19, 8:30pm ET/7:30pm CT/6:30pm MT/5:30pm PT for a Mass Call on COVID-19! On this call, we’ll discuss the work we’re doing right now as we lay out our demands for a COVID-19 response that puts people over profit.
The last few days have been scary and stressful for all of us. It’s become clearer than ever that our for-profit healthcare system does not protect human health. The Trump administration will try to tell us that the private sector will save us, but we know that any “solution” that reaps profit for a few at the top is no solution at all. The only choices we have in this moment are socialism or barbarism.
That’s why it’s important for us to come together and organize for a working-class solution to this crisis.
This mass call is for both members and non-members to get organized and work together in this moment. RSVP today!
Your DSA National Political Committee
This is not the planned North Star call on the political crisis,.
Now is the Time for Solidarity: DSA National Statement on COVID-2019
From the 2008 global financial collapse to the natural disasters caused by climate change that rocked Northern California, New Orleans, New York, and Puerto Rico, capitalism is causing devastating human crises. During each of these crises, it has been poor, working-class, and already marginalized people who have suffered the most — while banks, energy companies, and the real estate industry have been bailed out.
Now with the COVID-19 outbreak and a looming economic recession, it is hospital workers, poor and unhoused people, the elderly, incarcerated people, the immunocompromised, immigrants, and other marginalized groups who will likely bear the most impact. Millions of people have inadequate health insurance or none at all, millions are living paycheck to paycheck, and millions more are not given paid time off from work. That means that workers and poor people will be vulnerable to illness while being unable to afford treatment or even testing, endangering whole communities. Many who miss work because of the outbreak will lose pay, lose their health insurance, be unable to pay utility bills, or face eviction.
All of this is worsened by the fact that our government has been slashing budgets for services such as SNAP (food stamps) while handing bailouts to oil and natural gas companies. It is clear our irrational and expensive privatized healthcare system, organized not to protect human health but to extract profit, is unable to handle a crisis such as a sudden global pandemic.
Meanwhile, Trump and the Republicans are exploiting the crisis to blame scapegoats: immigrants, Chinese people, and the European Union are demonized, encouraging racism and xenophobia. Further, Trump’s stimulus plan will decimate Social Security if passed, one of our last truly universal social programs and a line of defense for seniors who are some of the most vulnerable to COVID-19.
As socialists, we reject austerity, privatization, racism, and xenophobia. Instead, we — the Democratic Socialists of America — stand with the working class, poor, and marginalized of our society and demand a working-class solution to this crisis.
A pandemic like COVID-19 confirms the truth in the radical labor movement slogan, “An injury to one is an injury to all.” We need to rapidly reorient our society away from the principles of individualism and private profit and toward the principles of justice and solidarity.
We support the measures proposed in the Families First Coronavirus Response Act, including federal funding for free coronavirus testing for all and paid emergency leave.
However, Congress must go further.
First, Congress must pass Bernie Sanders’s proposed Medicare for All legislation. Without providing comprehensive healthcare, free at the point of use, to all US residents, we cannot mitigate this crisis or its vastly disproportionate impacts on poor and working-class people. It is unacceptable that almost a hundred million people in the US are uninsured or underinsured during a massive public health crisis, while health insurance CEOs take home annual salaries in the tens of millions of dollars.
Second, Congress must pass an emergency moratorium on evictions and on utility shut-offs until the crisis abates. If workers are unable to work because of quarantines, they should not be punished for being unable to pay their rent and utility bills. Ultimately goods like housing, water, electricity, internet, and more should be provided as social rights to everyone, not hoarded for the profit of a few billionaires.
Third, instead of bailing out oil and natural gas companies during this crisis as Trump has suggested, Congress should take advantage of low oil prices to begin to phase out domestic oil production while introducing aggressive Green New Deal legislation that mandates carbon neutrality by 2030 while creating millions of good, green jobs. If we are to avoid catastrophic climate change — which will make natural disasters like hurricanes and global pandemics like coronavirus much more frequent and much more intense — we need to transition our economy off of fossil fuels starting immediately. With a looming economic crash that could put millions out of work, low interest rates and a oil price crash make this the perfect time for the Federal Government to begin this transformation.
In the face of a pandemic, we recognize we are only as safe as the people most impacted by our current systems. As a fourth demand, we call for a nationwide end to cash bail and a moratorium on deportations. The US is home to the largest detention system in the world. Given the torturous conditions, overcrowding, and unaccountable nature of our current carceral system, we call for individuals in prisons, jails, detention centers, and camps to be let go and that facilities are properly staffed with medical teams to ensure the well-being of those who cannot be temporarily released. We demand a moratorium on deportations to ensure that immigrant communities are kept safe and are not discouraged from seeking treatment.
We echo the demands laid out by Bernie Sanders earlier today, as he calls for state and national hotlines for residents to use for resources, information, and updates. We agree that this level of transparency must be relayed by scientists and health experts and not politicians. A vaccine, when developed, must be free, and that any medicine developed to help with the crisis must be sold at cost. The ICU and ventilator shortage must be addressed, and medical residents, retired medical staff, and other medical personnel should be mobilized, staffed with proper instruction and personal protective equipment, to ensure adequate staffing. We also agree with his call for emergency unemployment assistance at 100% of a worker’s income for ALL people, including those who work off tips, gig workers, domestic workers, and independent contractors. There must be emergency shelters erected, complete with healthcare and food, for the unhoused, domestic violence survivors, and college students.
Finally, all of this social spending should be paid for by taxing the rich. The American working class has repeatedly bailed out the same massive corporations and billionaires that cause and exacerbate crises. The Trump administration’s proposed solution, a payroll tax cut, would not provide any relief for the working class and, in fact, would exacerbate the issue by providing an incentive to continue working, even if sick, particularly for those without remote work settings or paid sick leave. The proposal would also endanger some of our most vulnerable populations by gutting funding to Social Security and Medicare. Time and again, the ruling class uses crisis to pit us against each other. This time, the rich — whose wealth is produced by workers — should foot the bill.
I watched the Bernie Sanders interview on the Rachel Maddow show last night, and I came away thinking that he fails to understand why the nomination campaign has taken the direction it has, and consequently will be unable to adapt and to win.
Sanders' response to the question of why he continues to do poorly with African-American voters was tone deaf and worse, but it also goes to what he is failing to understand about the campaign. His response was part denial, even though the numbers are quite clear and follow the 2016 pattern, and part patronizing, that African-Americans were voting for Biden because he was Barack Obama's Vice President.
Let me suggest a different thesis, that goes straight to why the campaign is turning in its current direction. Democratic voters (or at least between 2/3 and 3/4 of them) are telling us they have one priority above all others -- removing Trump from the White House and ending GOP control of the Senate. They understand the stakes of the election, and what it means for the survival of American democracy, and they are saying that their vote is first and foremost an anti-fascist and anti-authoritarian vote. They assess candidates on whom they think gives us the best odds to accomplish this goal, and vote on that basis. There are not blind to the flaws in Biden and Bernie as the candidate to accomplish that objective, which is why Biden's support fell when his flaws became evident, but they are realists and will pick the candidate who, in their opinion, gives us the best shot.
African-American voters -- especially older African-American voters -- have a deep collective memory of having lived in an age of home grown American totalitarianism: that's what the Jim Crow South was for African-Americans. Trumpism is all too reminiscent of Jim Crow, and African-American voters are telling us with their votes that what they care about, more than anything else, is stopping it in its tracks. And, my white friends, if you think this is a hyperbolic formulation, you need to read the literature on how the Nazis studied and used the Jim Crow legal codes as they formulated the racist and anti-Semitic Nuremberg laws, starting with James Whitman's Hitler's American Model. We need to give our African-American brothers and sisters the credit of being every bit as serious and thoughtful political actors as the rest of us, and stop patronizing them with the idea that they make their decisions based on whom was close to Barack Obama.
There are three important corollaries of this thesis.
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Save the Date !!!
We regret to inform you that the planned Webinar on What Is To Be Done by the North Star Caucus is postponed indefinitely.
With the growing expansion of issues and conflicts around the political response, our selected speakers are no longer available.
Please continue your conversations on line.
DSA national is holding a related call on Thursday. Open to all DSA members and allies.
Join us this Thursday, March 19, 8:30pm ET/7:30pm CT/6:30pm MT/5:30pm PT for a Mass Call on COVID-19! On this call, we’ll discuss the work we’re doing right now as we lay out our demands for a COVID-19 response that puts people over profit.
For those of you who join us for discussion, but have not joined the caucus,
Membership in the North Star Caucus requires filling out the application at the bottom of our manifesto:
Please be safe, healthy, and kind to one another.
Duane Campbell, for the
North Star Steering Committee
After Super Tuesday, ( still counting in California) nearly forty percent on the delegates to the Democratic Party convention will have been chosen, and the trajectory of the campaign to win the Democratic nomination for President will be much clearer. We will bring together a panel of political observers on the left to discuss their analyses of the state of the campaign and its likely direction, together with their prognosis of 'what is to be done' by activists and organizations on the left in general, and Democratic Socialists of America in particular.
Watch our google group and our blog for details.
Posted by Duane Campbell
BY PETER OLNEY AND RAND WILSON
The American presidential primaries began in earnest on February 3, 2020, with the now infamous Iowa caucuses. Iowa is a small mid-western state with a population of 3,155,070. Almost 85% of its residents are white – hardly representative of the U.S. as a whole, yet this is where the voting begins every four years to nominate candidates to the Democratic and Republican parties. It is a process of thousands of local meetings held across the state where voters come together to “caucus” for their chosen candidates. While most American states have simple ballot voting for candidates, the Iowa system choses its delegates based on a complicated formula “initial alignment votes” and “final alignment votes” that are used to determine the statewide number of “state delegate equivalents” for Iowa’s 41 delegates to the Democrats nominating convention
One thing is clear: democratic socialist Bernie Sanders won the popular vote with 42,672 first choice votes, about 6,000 votes more than former South Bend Indiana Mayor Pete Buttigieg. However, the byzantine caucus system apportioned 13 delegates to Buttigieg and only 12 to Sanders.
Sanders’ strong showing in Iowa was followed by a narrow victory on February 11 in the New Hampshire primary — another small and racially unrepresentative state — but an important bellwether of voter sentiment on the road to the nomination. Sanders won with 25.7% of the vote, Pete Buttigieg came in second at 24.4%, followed by a surprising strong third place finish for Minnesota Senator Amy Klobuchar at 19.8%. The dismal fourth place finish for Senator Elizabeth Warren of neighboring Massachusetts at 9.2% is of concern to the left because she and Sanders represent the anti-corporate wing of the electoral field.
Support for Sanders’ is surging with a strong base of young people and working-class voters. Amazingly, more than 1.5 million people have donated to his campaign with an average contribution of only $18. Unlike other candidates, who rely on major donors from Wall Street and corporate America, Sanders’ grass roots effort has shattered all previous records by raising over $121 million dollars — $25 million in January 2020 alone.
Despite Bernie’s initial successes, many Democrats have raised concerns about whether Bernie is the best candidate to beat Republican President Donald Trump on November 3, 2020. Beating Trump will require a “united front” of voters who may not be ready to support Bernie’s more radical “social democratic” proposals. For example, Sanders has championed Medicare for All and free college tuition for all, policies that are long established in Europe but viewed as very radical in the United States.
The U.S. “winner-take-all” Electoral College system does not lend itself to building electoral support with your preferred candidate in the election and then making parliamentary alliances after the election to form a government. In the case of the U.S., it will require broad unity behind one candidate for the Democrats to defeat Trump.
While the corporate-controlled news media is constantly degrading Bernie’s chances, there is a strong argument that he is the best candidate to form the broad coalition needed to beat Trump. In a head-to-head match-up with Trump, Bernie Sanders is the best candidate to:
How Socialists Can Govern
Bill Fletcher Jr.
February 1, 2020
Many on the U.S. left fear governing power, in part because it has been so difficult to achieve. More recent optimism among socialists is a welcome development—but we need a middle ground between being cynical and naive.
Gary, Indiana, faced capital flight after the city’s first black mayor, Richard Hatcher, attempted to implement a social democratic program., Bettmann/Getty Images // Dissent Magazine
Bernie Sanders’s presidential primary run in 2016 saw 13 million people vote for a democratic socialist. Two years later, Alexandria Ocasio-Cortez’s underdog, grassroots-driven victory against one of Congress’s most powerful Democrats shook the political establishment. Combined with the election of Donald Trump, these two campaigns reignited interest in something many on the left had shied away from for the better part of a century: electoral power.
But what is electoral power? Many political theorists distinguish between “state power” and “governing power.” The “state”—as described here—is not simply a series of apparatuses but instead the representation of the balance of class forces, with a hegemonic bloc—made up of institutions like the police, Congress, and the Federal Reserve—looking out for the long-term interests of the dominant class—in our case, the 1 percent. There are different fractions in the 1 percent with interests that sometimes diverge. They might receive differing degrees of support from the state and sometimes have stronger relationships with one party over another. Overall, the capitalist state looks out for the long-term interests of capital rather than the particular interests of any one capitalist.
“Seizing state power” is therefore a process of fundamentally altering the balance of class forces and creating a new hegemonic bloc that moves us away from capitalism. Winning state power involves the domination and, over time, deconstruction and replacement of capitalist institutions.
“Governing power” is something altogether different—effectively, progressives or leftists winning political office within the context of a capitalist state. They may be elected to positions of leadership, but they do not control the state apparatuses and do not have the mandate or strength to carry out a full and thoroughgoing process of social transformation.
This might look like winning a mayor’s or governor’s office. This is also the situation Sanders or any other left-leaning candidate is likely to walk into should they make it to the White House. More crucially, this is the situation that has faced countless left-leaning politicians in the United States and abroad who have tried to make inroads toward a consistent democracy, let alone democratic socialism, at the local, state, and even federal level.
That governing power has been so difficult to achieve and exercise has led many on the left in United States to fear it, and not without reason. Domestically and internationally, there have been many examples of significant challenges faced by a left that has gained governing power only to become corrupted or checkmated. But too many have taken the wrong lesson from this history and fallen back on empty rhetoric to articulate a path to power: first, describe a list of capitalism’s atrocities; second, say that socialism will resolve said atrocities—no intermediary steps required.
read more. https://www.dissentmagazine.org/article/how-socialists-can-govern
Bhaskar Sunkara, The Guardian.
This has been a confusing 24 hours, to say the least. The Iowa caucus appeared to go fine, but then a tabulating fiasco delayed official results. We’re still waiting on them.
The problem, in part, was rooted in a “Shadow Inc” application used to help tally the votes. The app had gotten attention in the weeks before the caucus, with experts worrying that it could be vulnerable to hacking.
There’s no indication that happened, and since the results were also all recorded manually, we should have confidence in their integrity (if not the byzantine caucus system itself). But it’s just another reason why some voters might not trust election results. Liberals have at times made hysterical claims that Russia “hacked” the election results in 2016. Keith Olbermann even went as far as to say that the United States was the victim of a “Russian coup”.
On the right, Donald Trump pushed the idea that illegal voting could swing elections in 2016, paving the way for him to contest a potential Hillary Clinton victory that year. And he’s renewed those claims recently, stating last July that “You’ve got people voting that shouldn’t be voting. They vote many times. Not just two times, not just three times … It’s a rigged deal.” Of course, the widespread problem is not illegal voting, but voter suppression – the systematic effort by Republican officials to make it harder for poor people, particularly people of color, to participate in elections.
On the left, Bernie Sanders supporters have a more reasonable beef. The Democratic National Committee pushed its preferred candidate in 2016, helping the Hillary Clinton team beat Bernie Sanders through measures such as limiting the number of debates (25 in 2008, but down to six in 2016). But these actions have been inflated into a narrative that the DNC “rigged” an election that Sanders would have otherwise won.
The key reason why Sanders fell short by several million votes in the primaries – that he was a relatively unknown candidate who ran out of time as he was gaining momentum – doesn’t have the same visceral appeal as a “stolen” race.
With Iowa, these claims will only get more attention. With 62% of the vote released as of Tuesday night, it appears that Sanders won the first and second rounds of the popular vote, but is slightly behind Pete Buttigieg in the delegate count. But on Monday night Buttigieg was able to take the stage and prematurely claim victory, and more importantly Sanders’ main rival, Joe Biden, was able to escape to New Hampshire without having the media reckon with the fact that the presumptive national frontrunner probably placed fourth in Iowa.
Saying that elections are all 'hacked' or manipulated nowadays is a great way to encourage working people not to come out and vote
It’s all quite convenient. And the name of the tech company that made the dubious app that caused much of the trouble is Shadow Inc!
But fellow Bernie Sanders supporters hear my plea – we gain nothing by playing into the idea that the process is so stacked against us that we can’t win. For one, saying that elections are all “hacked” or manipulated nowadays is a great way to encourage working people not to come out and vote. Why bother supporting an insurgent candidate, if the outcome is already assured?
Beyond that, this emphasis is a distraction from both the economic concerns that Bernie Sanders excels at talking about and the grassroots organizing that’s propelling him so far this campaign. Sanders placed well in Iowa, not because his Twitter warriors memed the DNC hard enough, but because his volunteers knocked on 500,000 doors in the state inJanuary alone. Despite only 4% of caucus attendees being Latino, they poured $1.5m into bilingual mailers. The campaign made so many phone calls (more than 7m) that they had to tell volunteers to stop – they had virtually no one left to call.
This unprecedented ground game was all in the service of a popular candidate running on a popular set of issues. There’s a reason why Democratic party elites like John Podesta are worried about the Sanders campaign – Bernie could very well win. With a dedicated base of supporters and turnout from lower-propensity voters, like working-class Latinos, Sanders has reliable votes and volunteers. And by the time the establishment coheres around Biden or some other candidate it will be too late.
We need to be vigilant for dirty tricks and rule changes meant to undermine us, but we should feel confident that victory is possible. And that means letting people know that their vote will be counted, and that even the flawed institutions of American democracy can sometimes deliver progress.
Thirty years of sophisticated attacks on runaway corporate power show that Elizabeth Warren would be a radical president
Written by Nathan Newman January 30, 2020
Capitalism dumps its financial dead in corporate bankruptcy courts–-and Elizabeth Warren knows where the bodies are buried.
Over thirty years ago, Warren made it her academic mission to understand the intricacies of how companies die, how the law decides who inherits the assets of the corpse and how that process drives rising inequality in the economy.
There is a trope that Warren was a late convert to progressivism – itself a bit debunked since she voted against Reagan in 1980. But dismissing her as a “technocratic” proponent of “good capitalism,” as Jacobin’s editors do, misses the deep radicalism of her legal and economic analysis. If you really want to place the candidate on the political spectrum, you need to understand the critique of corporate bankruptcy she made over 30 years ago when she argued that government, not some objective “market,” decides who wins and who loses and detailed how the rules shape our broader economic system.
One key divide between liberalism and radicalism is whether politicians let the market produce inequality in the economy and then use taxation and public spending to clean up the mess afterwards–the paradigmatic liberal approach. This contrasts with the more radical approach of actively shaping the rules of the economy up front to prevent the wildly unequal distribution of wealth in the first place.
Warren’s writings and her stump speech advocacy for “big structural change” place her decidedly in the second camp. That is reflected in her policy proposals —from remaking the financial system to calling for putting workers on boards of directors to promoting the break-up of monopolies to reshaping housing markets to arguing for redistributing wealth itself through a tax on the net worths of the richest Americans rather than just raising taxes on high-earners’ incomes.
Over thirty years ago, Warren was arguing that economic redistribution should not be left to budget politics but that policymakers need to be “dealing with the distributive issues that bankruptcy policy implicates”—the issues that create lopsided distributions to begin with.
As early as 1987, Warren was trashing the economic models of law and economics with their “simple answers” where “economic analysis is utterly self-referential…within a confined, abstract scheme” with no empirical basis in reality.
Conservatives, she wrote, must assume a sufficiently imperfect market for businesses to fail, but a sufficiently perfect market for their “version of a ‘market based’ solution’ to be effective in dealing with those failures. I have difficulty envisioning that market.”
Warren’s diagnosis of the problem of inequality dates back thirty years in her writing and is remarkably similar to what she says on the campaign trail now: the solution is not just getting better technocrats running the system but reducing the power of financial interests and increasing the voice and organizing power of average workers and consumers to control what laws get written in the first place.
Why Bankruptcy Laws Matter
Your eyes may glaze over hearing the words “corporate bankruptcy” – and that’s the point. The media tell endless stories of the winners of capitalist competition – the Apples, the Googles, the Exxons – but most firms, especially smaller firms that are never listed on the stock market, don’t survive and the distribution of their assets in bankruptcy court matters. But that process is arcane and meant to be that way to the advantage of those who benefit from it.
Donald Trump epitomizes this reality since several firms that he has owned have gone through bankruptcy, stiffing creditors and contractors, even as Trump himself leveraged the legal system to shield most of his own personal assets. As Trump himself acknowledged when asked about his many bankruptcies, “I’ve taken advantage of the laws of this country.”
Documenting how wealthy operators like Trump take advantage of the bankruptcy laws to increase economic inequality and figuring out how to design the law to promote greater equity has been much of Warren’s life work.
Bankruptcy is actually at the center of our economy. as Warren wrote back in 1992, “The most difficult social problems get dumped into bankruptcy– mass torts, environmental disasters, the dashed expectations of retired employees.” The failures of capitalism have to be managed by bankruptcy court judges. That’s where, for example, kids in chemotherapy, union workers with empty pensions and bankers square off to divvy up the assets of a belly-up chemical company that poisoned the groundwater in multiple communities.
Economists and legal writers like to pretend that the economy is made up just of markets and contracts, but Warren dismisses this as a “fiction” which lasts until one party or the other no longer has the money to make good on those promises. At that point, bankruptcy courts navigate all the “normative issues of fairness ignored in contract law,” which Warren argues the business class pretends has no place in economic thinking.
Bankruptcy exists not to further markets but to correct the mistakes that led to bankruptcy happening in the first place – and brings active government concerns for distributional fairness into play. “It provides a forum for negotiating deals, and, ultimately, it allocates the value of a firm to all claimants, making difficult distributional decisions among competing parties.” Pension holders owed money long into the future get into the same court proceeding with the banks holding immediate debt–“both present and future claims at once,” as Warren highlights.
How Bankruptcy Law Shapes Markets and Economic Inequality
Every legal rule in bankruptcy, Warren argues, reverberates in the broader economy to shape market outcomes, sometimes to the good, more often to the advantage of the wealthy, but never in some “natural” way as conservative economic thinkers would have it.
Warren writes: “Any legal rule will cause some redistribution of wealth.”
This may be obvious to many progressives, but it challenges the core capitalist legal ideology that law can stand outside the market and be a neutral arbiter of contractual relationships. Instead, Warren sees legal rules as inherently favoring one group over another at every economic point of negotiation: “A rule of ownership, a rule of liability, or a rule of priority will relatively advantage or disadvantage competing parties.”
Stakeholders with explicit debt-based contracts with a firm, so-called “secured creditors”, consistently get priority by bankruptcy judges because, as Warren argues, they helped write most of the rules: “The group that profits from priority is well-funded and active…Their representatives are present at every drafting committee meeting and debate on the subject.”
Consumer debtors “have a perpetual problem” in Warren’s words: “they do not have money and they do not organize.” For more organized labor and civil rights groups “bankruptcy was never a top priority,” so, she argues, the monied interests with their singular focus and far deeper pockets dominate the process far more of the time- one reason Warren makes strengthening the organizing power of workers and consumers a priority to alter that dynamic in the setting of legal rules across the economy.
Bankruptcy as Backdoor Industrial Planning
Warren focuses relentlessly in her work on the role of firms not just as profit-maximizing machines for shareholders – the conservative ideal – but as institutions serving the broader economy, the perpetual focus of progressives who promote industrial planning.
Industrial planning by the government is usually talked about on the left only after firms have shut down in a community, but Warren focuses on why bankruptcy law brings the broader social values of industrial planning to bear before companies disappear, and argues that it must go further in this area.
One key goal in bankruptcy is keeping the firm going. Partly, this enhances the value of its assets to pay off its obligations, but it also serves broader political interests of those outside contract relationships in the market. As Warren wrote, “the revival of an otherwise failing business also serves the distributional interests of many who are not technically ‘creditors’ but who have an interest in a business’s continued existence.”Those interests include older employees who can’t be retrained for other jobs, customers losing key suppliers of goods and services, suppliers losing current customers, property owners suffering declining property values, and states or municipalities facing shrinking tax bases.”
While corporate law and general contract law studiously exclude those broader community stakeholders from legal consideration, federal bankruptcy statutes create a real role for those interests – and Warren makes clear that expanding the law’s focus on those broader community interests should be a priority.
Creditors may want to dismantle a firm so they can get paid quickly but bankruptcy court, Warren argues, is where government is mandated to step in to protect the social values the market ignores.
Warren’s Ideological Challenge to Market Economics
Warren’s focus on community interests beyond the narrow confines of the market reflects her deeper ideological challenge to traditional legal economics. Warren argues that markets ignores ”parties without legal rights” and that we need a legal system to “protect these parties [and] more than the goods that are traded by private contract.”
Thirty years ago, Warren was a very public combatant with conservative “law and economics” legal writers, quoting Duncan Kennedy of the quasi-Marxist Critical Legal Studies movement that “the insulation from value judgments that economic analysis offers is illusory.”
Warren openly mocked the idea that there was any “real” market that law was supposed to try to drive the economy towards. Any attempt to discuss policy “in a perfect market is a Zenlike exercise, much like imagining one hand clasping,” so attempts to imagine a “perfect market” were “worth little.”
Warren’s was an empirical critique of how markets function, but it was also a values-based statement that recognizing just the interests of those with property rights in the market would fundamentally be unjust. She rejected market-based bankruptcy schemes as one where those without direct contracts with a firm, including “tort victims, discrimination and harassment complainants, or antitrust plaintiffs, would be left out.” A market approach “is overtly distributional in a regressive sense” in moving wealth from those with weak or no property rights claims in the market to those with enough political power to shape the rules.
At the heart of Warren’s ideological vision is a clear demand that the market and property rights be subordinate to the human needs and democratic will of the community.
Warren as a Radical Leader
Even as the corporate Right has been determined to conquer the courts in order to shape the law to further corporate interests, the liberal movement has been remarkably unfocused on the role of law in promoting economic inequality through the rules of the market.
Liberals have tended to treat battles in the courts as the place where social issues like abortion and gay marriage play out, while reserving their energy fighting economic inequality for tax and budget battles. Based on her corporate bankruptcy writings and current proposals, a Warren Presidency, probably even more than a Sanders Presidency, would refocus the liberal-left on how legal rules decide winners and losers in the economy before a widget is produced or a line of code is written.
All her skepticism of markets is reflected in Warren’s array of economic plans in her Presidential run which systematically subordinates every market and property rights claim to regulatory supervision. Most on point is her proposed “Accountable Capitalism Act,” which would take supervision of large corporations away from the states and put them under federal regulation- and require them to “consider the interests of all corporate stakeholders – including employees, customers, shareholders, and the communities in which the company operates”– exactly the broader stakeholder interests usually considered only once companies have failed and gone into bankruptcy court.
Warren may call herself a “capitalist to my bones” but it is a “capitalism” in opposition to the systematic valorization of property rights and market solutions that is currently embedded in our economic and legal system.
Warren has spent decades arguing markets are the legal creation of government rules- and argues for far-reaching changes in how that government should design those rules. Whatever you call it, Warren’s analysis dating back thirty years, and the proposals she now promotes, reflect an ideology that would make her orders of magnitude more radical than any President in our history.
A lawyer, policy advocate and writer, Nathan Newman also teaches sociology and criminal justice at CUNY.
In spite of my consistent attempts, I was unable to insert a read more tag in this post.
Bill Barclay, CPEG, and Ventura DSA
Last year was the tenth since the end of the Great Financial Crisis (GFC) and the third of trump’s presidency.
Trump came into office promising increased rate of growth – 4% maybe even 5 or 6% – an end to trade deficits and more jobs, including a revival of manufacturing.
So, where so we stand?
On the question of growth there is no doubt: although the numbers for the 4th quarter GDP growth are not in yet, it is clear that 2019 will be the 13th consecutive year of real GDP growth below 3%, probably around 2.3%. This number is in contrast to the 3% annual real GDP growth that occurred between during early 1987-2007 neoliberal decades, and even further below the 3.7% average for the first three plus decades (1948-1980) following World War II. The U.S. economy is stuck in low gear. And, the usual policy response of the neoliberal era – cut corporate tax rates in the hopes that more investment will occur – is not working. The “Tax Cuts and Jobs Act” (TCJA), Trump’s major tax cut enacted in 2017, has not moved us off the launching pad.
The Stock Market
Or at least not most of us. After a down year in 2018, the stock market raced to quite a few records in 2019, rising 30%. A major driver of this gain was the use of the increased cash in the hands of corporations to purchase their own stocks. While 2018 will probably remain the record year for such stock buybacks, 2019 will be a close second. (Among the chief beneficiaries of stock buybacks are the company executives who are offered stock options as part of their benefits.)
But the interesting, although often neglected, fact about stock buybacks is how they have been financed. More than half of all buybacks are paid for by the purchasing company taking on more debt. It is sort of like mortgaging your house so you throw a big party. The result was a ramping up of non-financial corporate debt in 2019 that now exceeds 75% of GDP, above the previous record peak in the midst of the GFC. And, half or more of this debt is rated BBB, the lowest grade above junk bond status. The risks for your pension fund – yes, it is probably buying this stuff to get higher yields – is that, if a downgrade to junk status occurs (as happened to Ford in late 2019), your fund will have to sell – pension funds can’t own junk bonds.
The use of corporate cash to buy back stocks was accompanied by a failure of the TCJA to achieve its stated goal of increasing the rate of investment, by providing “rocket fuel for the economy.” Business investment has declined throughout 2019 and now is at a level similar to that of the 2000-01 recession, although well above the trough during the recession that followed the GFC. Of course, Trump blamed others for the failure of the U.S. economy to achieve a 4% (or even 3%) growth rate – in particular the Federal Reserve – in his January 2020 Davos rant.
During his campaign, Trump repeatedly attacked existing trade agreements, labeling NAFTA as “perhaps the worst deal ever made.” He also vowed to end the “cheating” by China in trade practices, although he blamed previous U.S. leaders for letting China do so.
At the end of 2019, Trump got a new NAFTA, “The U.S./Mexico/Canada Agreement (USMCA) through Congress. The USMCA does have some improvements over the old NAFTA but is very weak on environmental issues – climate change is never mentioned – and will likely have limited impact on the economic geography of automotive jobs.
What about the big trade picture? In December 2019 there was much made of the quarterly decline in the U.S. trade deficit. But missing from the self-congratulatory posturing was the fact the 2018 trade deficit was a record, eclipsing even those just prior to the GFC. The year 2019 will likely see a smaller trade deficit – but still much larger than the early 2000s.
Read more: https://www.cpegonline.org/post/year-three-of-the-trump-economy-the-us-economy-in-2019
by Benjamin Sachs
Published January 23rd, 2020
After eighteen months of highly collaborative work involving over seventy academics, organizers, lawyers, and students from around the world, we released this morning the report and recommendations of the Clean Slate for Worker Power project. You can learn all about the project at cleanslateworkerpower.org. Our full Report is available here, and the Executive Summary here. The Introduction, which outlines the theory and ambition of the project, is below:
A Clean Slate for Worker Power:
Building a Just Economy and Democracy
Since the founding of the country, concentration of power in the hands of a small minority has been recognized as a threat—perhaps the primary threat—to the viability of American democracy. This threat of concentrated power motivated the drafters of the U.S. Constitution to advocate for a system of checks and balances and a division of authority between state and federal governments. Concern over concentrated power explains the founders’ desire to ensure that a “multiplicity of interests” would be represented in the decisions of the national government. This aspiration finds expression in core principles of our democratic system: in the idea that every person should have one vote, no more and no fewer; in the idea that we are to have a republican form of government, not an oligarchy or an aristocracy; in the idea that we are all equal before the law.
But, since the founding of the country, the struggle to uphold these constitutional principles against the threat of concentrated wealth has been a continual one. This struggle was central to the story of the New Deal. Thus, President Franklin Delano Roosevelt critiqued wealthy business and financial elites by naming them “economic royalists,” thereby invoking the American revolutionary struggle against political royalism. As FDR put it in 1936: “For too many of us the political equality we once had won was meaningless in the face of economic inequality.” 1 This democratic struggle against concentrated economic power has also been core to the highest aspirations of the labor movement. Dolores Huerta, leader of the United Farm Workers’ historic organizing effort, put it this way: “Organized labor is a necessary part of democracy, [because o]rganized labor is the only way to have fair distribution of wealth.”
The struggle to preserve democracy in the face of extreme wealth concentration is a defining feature of our current historical moment because we live in a time of radical economic inequality. The point can be illustrated with any number of statistics, and it is worth reviewing a few of them:
· The average Amazon worker makes $29,000 per year, while Jeff Bezos, the CEO of Amazon, has a net worth of $110 billion. This means it would take an Amazon worker 3.8 million years, working full time, to earn what Bezos now possesses. It would take an Uber driver, driving full time, nearly 150,000 years to earn what Uber co-founder Travis Kalanick made on the Uber IPO.
· The country’s wealthiest 20 people own more wealth than half of the nation combined—20 people with more wealth than 152 million others.
read more. https://onlabor.org/a-clean-slate-for-worker-power-building-a-just-economy-and-democracy/
Bernie-and-Elizabeth Matters More Than Bernie-vs.-Elizabeth
History will remember both Sanders and Warren for taking on American capitalism. Their differences won’t loom that large. BY HAROLD MEYERSON
JANUARY 16, 2020
Preliminary thoughts on reviving a U.S. antiwar movement
JANUARY 9, 2020 BY JOE ALLEN
We haven’t had an antiwar movement in the U.S. for a long time. So, when Iranian General Qassem Suleimani was assassinated on orders from President Donald Trump on January 3rd, it immediately raised the prospect of a real shooting war between the U.S. and Iran. It also caught many of us flat-footed and scrambling to respond.
Read the essay on Democratic Left.
Interesting article on Working In These Times.
#NoWarWithIran: What You Can Do NowJANUARY 7, 2020People across the globe are reeling from the U.S. military’s escalation towards war. Just weeks after anti-government protests in Iran about rising fuel prices, these attacks on Iraqi soil bring us dangerously close to never-ending U.S. led war with catastrophic consequences for millions of Iranians, Iraqis, and people across the Middle East.
Join our national organizing call this Thursday, 1/9 at 8pm ET/7pm CT/6pm CT/5pm PT.
War would also immediately put at risk our own domestic fights for Medicare for All, a Green New Deal, and other programs. It would bring thousands more working-class people from the U.S. into the war zone. And it would lead to increased racial and religious profiling in our communities and suppression of dissent. Democratic socialists understand that working class people in the U.S. have nothing to gain from war in the Middle East and we must do everything in our power to stop further U.S. military intervention in the region.
Already, DSA chapters all over the country are organizing demonstrations demanding an end to the escalation, but it will take sustained pressure from a mass movement to stop U.S. imperialism.
Join us for an emergency national strategy call THIS THURSDAY NIGHT, January 9th, 8pm ET/7pm CT/6pm MT/5pm PT on how we can help reignite a mass anti-war movement to stop a war with Iran.
On the call, we’ll be joined by:
Demand they support:
You can read our DSA National Political Committee statement for more information. And if your chapter is having a #NoWarWithIran action, or you’d like rally posters for friends and neighbors, you can order union-printed posters through our swag store. Overnight shipping is available.
We will update this page as the situation unfolds.
There was a time in America when being called a socialist could end a political career. Not anymore.
By Keeanga-Yamahtta Taylor
Dr. Taylor is the author of “From #BlackLivesMatter to Black Liberation.”
· Dec. 10, 2019
…Adding to that, Mr. Sanders is the top recipient for donations by teachers, farmers, servers, social workers, retail workers, construction workers, truckers, nurses and drivers as of September. He claims that his donors’ most common employers are Starbucks, Amazon and Walmart, and the most common profession is teaching. Mr. Sanders is also the leading recipient of donations from Latinos as well as the most popular Democrat among registered Latinos who plan to vote in the Nevada and California primaries. According to Essence magazine, Mr. Sanders is the favorite candidate among black women aged 18 to 34. Only 49 percent of his supporters are white, compared with 71 percent of Warren supporters. Perhaps most surprising, more women under 45 support him than men under 45.
Mr. Sanders’s popularity among these voters may be what alienates him within the political establishment and mainstream media. The leadership of the Democratic Party regularly preaches that moderation and pragmatism can appeal to “centrist” Democrats as well as Republicans skeptical of Mr. Trump. It is remarkable that this strategy still has legs after its spectacular failure for Hillary Clinton in 2016.
In many respects, Bernie Sanders’s standing in the Democratic Party field is shocking. After all, the United States government spent more than half of the 20th century locked in a Cold War against Soviet Communism. That an open and proud socialist is tied with Ms. Warren for second place in the race speaks to the mounting failures of free market capitalism to produce a decent life for a growing number of people. There was a time in America when being called a socialist could end a political career, but Bernie Sanders may ride that label all the way to the White House.
This essay has been updated to reflect news developments.
From the New York Times
All unhappy social democratic parties are alike: They’ve lost the white working class.
Britain’s Labour Party was decimated in its working-class home last night, when Boris Johnson’s nativist Tories ousted one Labour MP after another in England’s North, once the U.K.’s industrial heartland, today its rust belt. The migration of Britain’s abandoned workers to the anti-immigrant nationalism at the root of Brexit closely tracks the pattern we’ve seen in France, where the longtime proletarian strongholds of the French Communist Party have turned to the insular nationalism of two generations of Le Pens in recent elections. And in the historic home of European social democracy, Germany, the world’s oldest social democratic party is polling close to single digits.
Last night’s election in the U.K. marks the worst performance by Labour since 1935—just as the most recent elections in Germany and France also marked the low points for the Social Democrats and Socialists, respectively. Socialists do govern in Spain, Portugal, Denmark, and Sweden (though the Swedish Social Democrats also experienced their worst election in 2018 and govern now in coalition with that nation’s Greens), but these are exceptions to the painful decline of European social democracy.
Four kinds of fragmentation have vexed the parties of the European left over the past 20 years, as they’ve vexed the Democratic Party in the United States as well. The first stems from the growing presence in those parties of urban upper-middle-class professionals, who are often at odds on cultural questions, broadly defined, with the parties’ more traditional and patriarchal working classes. The second is no stranger to the United States but is only now impacting Europe with the diminution (not sudden, but perceived as such) of many nations’ relative racial and religious homogeneity—defections from the left due to racism and nativism. The shift last night of England’s North from Labour to the Tories summoned memories of George Wallace’s surprising successes in Northern states in the Democratic primaries of 1964, heralding the end of the New Deal coalition and the subsequent electoral victories of Richard Nixon and Ronald Reagan. The third fragmentation results from geographic divergence—with minorities and the culturally liberal young and professionals clustering in cities with large service sectors, while formerly industrial and rural areas, increasingly poor and elderly, experience both the reality and the sense of abandonment.
Underlying all three of these fragmentations is the de-linking of class interests: As globalization and financialization (the latter particularly pronounced in the U.K. and U.S.) have undermined the egalitarian achievements of the postwar era, parties of the center-left have been stretched ideologically, often to the breaking point. The ’90s saw Britain’s New Labour under Tony Blair, America’s Democrats under Bill Clinton, and Germany’s Social Democrats under Gerhard Schröder all move to globalize and deregulate their economies, to the benefit of those nations’ banking and corporate sectors and the detriment of their working-class voters. The collapse of 2008 and the hugely unequal recovery that followed has led to battles between the center-left and a more militant left in virtually every industrialized nation.
Introduction to Seed the Vote
Jason Negrón-Gonzales, Organizing Upgrade
The Trump era has been all about the naked aggression of the far right, but cracks are appearing. Trump is battling impeachment, a result not only of his criminality but of the changes that the blue wave brought to Congress. Last month we saw further losses for the right in Virginia, Kentucky and Pennsylvania – the result of sustained organizing by hundreds if not thousands. That work didn’t start this year; it’s the culmination of many years of work. None of this was spontaneous. When we organize, we can win. When we step up to fight, we can win.
… The possibility of Trump’s re-election in 2020 is a real one. And it’s one we are determined to stop. When we – a group of left activists rooted in community and labor organizing in the San Francisco Bay Area – gathered this spring, it was with the urgency that came from seeing our communities under relentless assault from a white nationalist, authoritarian administration. But we also knew that 2020 – with the size, energy, and leftward shift among the opposition to Trumpism – would give us an opportunity: if we plan carefully and think big, we can make a difference at the ballot box in 2020, the kind of difference the Left failed to make in 2016. And we thought we could do this while building a stronger and more cohesive Left.
Social justice efforts have been able to activate significant mass actions in opposition to Trump and right-wing policies, from the Women’s March to airport protests to the more recent teacher strikes. Mass mobilization played a particularly important role through 2018, in stalling or rolling back many of Trump’s assaults on communities of color and democratic rights. Alongside the energy in the streets, progressive institutions have gotten renewed energy.
The Democratic establishment makes consistent efforts to squelch progressive electoral insurgencies, for example proposing bans on consultants who work with radicals challenging incumbents in the primaries. And the ‘moderate’ forces use their command of the media to undermine or even smear left candidates and grassroots non-electoral organizations.
**The influence of progressive ideas and the reach of organizations espousing a social justice agenda have grown substantially since 2016, but a realistic assessment of the balance of forces tells us that the progressives remain fragmented in many ways and, even if we were more united, remain weaker and far less resourced than the long-established centrist and corporate forces in the opposition to Trump and, specifically, within the Democratic Party.
The opinions expressed here are those of members and allies of DSA North Star Caucus meant to educate, inspire discussion and encourage comradely debate.