In Bed with Wall Street

DoyleIn Bed with Wall Street: The Conspiracy Crippling Our Global Economy by Larry Doyle,  a former mortgage-backed securities trader, is receiving a strong, early reception. In its first week, each of four Amazon.com reviewers gave it five stars and posted glowing reviews.

On Jan 7, 2014, C-SPAN presented a compelling, accessible 40-minute Book Discussion with Doyle.  Watch and weep. I did.

The book’s publisher posted the following description:

The Wall Street meltdown in 2008 brought the country to its knees, and spawned nationwide protests against the lack of regulation and oversight facing Wall Street. But the average American still fails to fully grasp what was—and still is—happening: that the inmates continue to run the asylum. Doyle has been tracking this story for years through his blog Sense on Cents, and exposes here how Wall Street, our politicians, and the regulators themselves have conspired for personal and industry-wide gains while failing to protect investors, consumers, and the American taxpayer. He details the corrupt nature of Wall Street’s financial police, who are little more than meter maids imposing fines that amount to nothing more than a slap on the wrist. He exposes the revolving door of Wall Street, wherein the regulators are all former or future employees of the very firms they’re tasked with overseeing, and how they routinely serve the interests of the industry itself rather than protecting investors and markets. Recent bombshells—such as multi-billion dollar trading losses at JP Morgan Chase, the manipulation of interest rates via the LIBOR scandal, and money laundering with North American drug cartels and rogue nations such as Iran—are symptomatic of this corrosive culture and the lack of trust and confidence in the system. As the big banks fight tooth and nail to avoid real reforms that would protect the economy, this book is a timely, important, and shocking look inside the Washington-Wall Street conspiracy crippling America and the global economy.

Job Opportunity Pledge

This morning I sent the following email to Michael Stein, Dean Baker, Justin Talbot Zorn, Phil Harvey, Karen Dolan, and Noam Chomsky:

I suggest the development of a Norquist-style “Job Opportunity Pledge” to be presented to candidates for public office.

I believe the Institute for Policy Studies would be a good central collection point.

Following is a draft of content for such a pledge:

Job Opportunity Pledge

I, _________________________________________, pledge to the American people that I will:

ONE, consistently affirm and build support for the human right to a living-wage job opportunity; and

TWO, support legislation that will help see to it that everyone who wants to work can find a living-wage job.

Feel free to “reply to all” to discuss this idea. If you prefer to opt-out of any such discussion, please do. Just let us know. No hard feelings.

An argument for this perspective is presented in “The Human Right to a Decent Job,” which has elicited the following responses:

Makes sense to me. If you haven’t seen it yet, you might be interested in the work of Robert Pollin (progressive economist at U Mass) on living wage and how to achieve it.
Noam Chomsky, Professor Emeritus, Massachusetts Institute of Technology (MIT)

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It’s an excellent article. While it’d be good to bring it down to about 750 (classic op-ed length), not essential. After carefully reviewing, I feel that every sentence has some unique value. I especially like the way you take on the conservative counter-arguments directly.
Justin Talbot Zorn, Public Policy Fellow, Harvard University

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Economists can’t come up with the right answers unless they are asked the right questions. In this brief article Wade Lee Hudson reminds us that the question we really need answered is not how low we can push the unemployment rate before inflation rates begin to rise, but how to insure the availability of enough jobs to provide decent work for everyone who wants it. If more people beat this particular drum, maybe the economics profession would begin to listen.
Philip Harvey, Professor of Law and Economics, Rutgers University

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Looks good to me. Good luck with it.
Dean Baker, Co-founder, Center for Economic and Policy Research

The Human Right to a Decent Job

Inca Wall in Coricancha, Cusco
szeke / Foter.com / CC BY-NC-SA

By Wade Lee Hudson

Most Americans agree. As a society, we should see to it that everyone who wants to work can find a living-wage job opportunity. When we establish that foundation of economic security, everyone will benefit. Securing this human right is our moral obligation.

Pope Francis may inspire a widespread moral renewal that prompts business owners to pay better wages. The wealthy may someday donate enough money to non-profit organizations to hire everyone who needs a decent job. Until we witness that change of heart, however, the federal government must help.

As citizens, we need not prescribe exactly how the government should assure genuine full employment. The experts can figure that out. Our job is to keep pushing them until they do it. But we can suggest some options.

Without increasing the deficit, we can minimize problems associated with “big government” by distributing federal revenue-sharing funds for public-service jobs to local governments, where citizens can monitor and influence how the money is spent. The jobs created can be regular, permanent jobs that provide needed services, like child care, substance abuse programs, in-home caregiving, and improving our parks – not temporary “make work” positions or jobs only for people who meet certain qualifications. Priority can be given to entry-level jobs in the $12-16 per hour range in order to maximize the number of people who gain employment.

A sales tax on Wall Street speculation can raise $100 billion or more annually, which would also discourage dangerous, unproductive gambling. In addition, we can close loopholes that allow corporations to hide profits offshore, and transfer funds from wasteful military spending. Creating jobs will boost the economy and generate additional tax revenue, which we can use to create more jobs. Savings from reduced food stamp and unemployment insurance payments will also be available.

By steadily increasing funding each year, local governments can prepare for how to use the money, and the governments involved can better deal with any problems that develop. The size of the grants can be based in part on local unemployment rates. Cities and town with more unemployment will receive more. We can insist that local governments not use the money to replace their current programs and reduce their own taxes.

We can’t guarantee everyone a job, but we can guarantee the opportunity. We can insist that supervisors assure that their employees work hard. They owe their workers and the taxpayer nothing less. If good jobs are available we shouldn’t give tax money to people who are able but unwilling to work.

Not every unemployed individual will take advantage of these opportunities. Some people will first have to deal with substance abuse, helped by knowing a meaningful job awaits them when they get their act together. Other individuals will rely on friends, family, or charity. But almost everyone who wants to work will put in a solid effort if given the chance. And everyone has some useful skill.

When we achieve true full employment, those who are worried about food stamps fostering dependency can rest assured that we are supporting self-determination. Business owners will gain from a more prosperous economy. Everyone will benefit from living in a more harmonious, safer society. People formerly living in poverty will be able to make ends meet, which will greatly improve the quality of their lives. Most workers will: 1) benefit from higher wages (because employers will pay more to keep trained employees); 2) be treated with more respect by employers (because workers will have more choices), and; 3) have more leisure time to relax with their families, enjoy their lives, and contribute to their community.

A common argument against full employment is that it would cause excessive inflation. But most efforts to increase employment have relied on deficit spending, which can be inflationary, and a jobs program can be funded without increasing the deficit. Increased global competition makes inflation less likely; in recent decades, when unemployment decreased, inflation did not increase. A public-service jobs program will have less inflationary impact than boosting private-sector employment. Funds will disproportionately go to areas with higher unemployment, which means less inflationary pressure. And so long as wages and Social Security payments increase to compensate, modest inflation is not a problem for most people.

The federal government has created unemployment and poverty on purpose, in the name of preventing inflation. But those actions are a moral outrage. If and when inflation becomes a problem, we can deal with it some other way.

In the meantime, let’s help our society live up to its highest ideals, “promote the general welfare,” and support “life, liberty, and the pursuit of happiness.”

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Wade Lee Hudson a community organizer and part-time cab driver in San Francisco is author of the Guarantee Living-Wage Job Opportunity petition.

Guarantee Living-Wage Job Opportunities

The Guarantee Living-Wage Job Opportunities petition is addressed to “activist organizations” and reads:

We urge you to work together to persuade the government in Washington to see to it that everyone who wants to work can find a living-wage job.

We can easily assure that  everyone who wants to work can find a decent job. There is no good reason not to do so.  Achieving this goal would have an enormous, positive impact throughout our society. Access to a decent job is a human right. We are morally obligated to secure that right. Please support this effort by signing the petition in one of the following ways:

  1. Click here to sign on Causes.com.
  2. Use the form below.
  3. Send an email to wadeATwadehudsonDOTnet. 

A list of all signers will be maintained below. For more info on this project, click here.

RELATED PROPOSAL: Proposed: A Working Conference on Full Employment (3/23/14 Draft)

Petition Supporters  (sorted by first name):

Abdul Malik Khan
Adrian Cracchiolo
Agnès Moreau
Aldo Barbieri del Carpio
Alexandr  Yantselovskiy
Amanda Reid
Ami des Animaux
Amy Chastain
Amy Ledoux
Amy Rogers
Andrés Thomas Conteris
Andrew Blake
Andrew Johnson
AngelHumanimale Gyma
Anik Lambilliotte Alf
Animus Agrzam Hachi
Ann Pace
Anne Sophie Davidson
Annie McMahon
Annie Peysson
April Johnson-Shults
Barbara Betts
Barbara Kivowitz
Ben Ament
Bernadette Peu Importe
Beth Waltz
Betty Traynor
Bhikkhu Bodhi
Bill Clark
Bilpin Horserescue
Bob Anschuetz
Bob Morgan
Bonnie Weisel
Brad Reed
Bridget Childs
Britni Marshall
Bruce Hartford
Bruno Meurin
Calesse Baldwin Carter
Carol Lopez
Carol J. Meyer
Carolyn Kellogg
Cathy Botha
Chantal Perraud
Charlene Priscott
Chats d’Isa
Cherie Barnard
Chris G
Christine Alajarin
Christopher Lizak
Chuck Gleba
Clara Locher
Claudia Horwitz
Claudio Alpaca
Clinton D McDowell C
Cornelis Brigitte
Corrida Basta Ya
Dan Brook
Dan Nissenbaum
David Glober
David A Johnson
David Hartsough
David Jensen
David Smith-Ferri
Debra Brady
Denise Dynan
Denise Janssen Eager
Dennis Kobata
Dh Fabian
Divna Kisic
Dominique Benoit-Girard
Don Karp
Donald Goldmacher
Donald E. Vincent
Doug Butler
Doug Yamamoto
Doyle Phillips
Dusa Althea Rammessirsingh
Edith Prickley
Edurne González
Ellaine Lurie-janicki
Ewa Dublin
Fabienne Henry
Frank Smith
Gail Soudatt
Garay Ale
Rev. Glenda Hope
Gordon Fellman
Grace Foote
Gweneth Rosemaydance Dietrich
Gwenn Craig
Hayyim Feldman
Heidi Moore Breider
Helen Geiger
Huguette Dethiege
Is Adora
Isabelle Dumotier Épouse Godet
J. Michael Gilbreath
Jacques Laus
Jakada Imani
Jan Hartsough
Jan Vajda
Jane Gahan
Janet Weil
Janice Anschuetz
Jason Reuss
Jean François Lepicard
Jed Riffe
Jeff Aitken
Jeffrey B Peters
Jennifer Adams Devine
Jocelyne Lapointe
Joan Greenfield
Joce Farouault
Joel Sachs
John Breeding
John Cloud
John Testa
Joy Alexander
Julie Greenberg Takatsch
Julie M Morgan
Justice Saint Rain
Justin Talbot Zorn
Karen Wolfman
Katherine Fisher
Katherine Sofos Looper
Kathleen Spencer-Harbaugh
Kelly Kinsella
Ken Hodges
Kevin John Dail
Kirsten Moller
Kristen Walsh
Laia
Larry Pettit
Larry Walker
Lawrence Domingo
Len Mell
Leonard Reiter
Leonard Roy Frank
Leeloo Cat
Li Corne Janin
Lisa Ault
Lisa Salazar
Lorelee Strand
Lorraine Roberts
Lucas Klein
Lucia Asara
Lucien Kubo
Lucille Sutton
Luise Behr
Luz N. Sanchez
Lynnette Jeffrey
Lysiane Servais
Magdalena Abrego
Maggie Meehan
Malcolm S. Hoover
Manuela Wolter
Marcella Womack
Marco Good
Maria Antonieta Eguiluz Romo
Maria Schulz
Marie Arbour
Marie Pritt
Marie Time
Marilyn Borchardt
Mark Brewster
Mark Masaoka
Marty Weisel
Mary Hudson
Mary Lynne Quinnan Zahler
Matt Wilson
Melanie Appleby
Melissa Ritchey
Michael J. Carano
Michael Foster
Michael Friedman
Michael Larsen
Michael Nulty
Michael Robin
Michael Shaughnessy
Michael Stein
Michael Tsukahara
Michael Wade
Michelle Gralow
Micky McGilligan
Mike Tikkanen
Mike Zonta
Millamaria Vaittinen
Mitchland Winter
Nadia Sindi
Nancy Ouellet
Nancy Walton-House
Nathalie Massaria
Nicholas Littlejohn
Ninah Piazza
Pascale Blangis
Patricia Audrain
Patrick Di Nicola
Pauline Eden
Penn Garvin
Peter Stern
Peter Wong
Philip Harvey
Phoebe Anne Sorgen
Rachael Atchison
Raman Chawla
Rashid Patch
Raymond Feldpausch
Rebecca Stacey White
Rene Burke Ellis
Richard Gross
Rita Jolidon
Rob Waters
Robert Frazier
Robert Kiser
Robert Kourik
Robert Raymond Planthold
Robin Hensel
Roger Marsden
Roma Guy
Ronald Tanguy
Ron Stief
Ronny De Coster
Roy Birchard
Sandra Gonzales
Sara Avery
Sara Colm
Sharon McAllister
Sheila Loayza
Sheldon Maskin
Shyrl McCormick
Silvia Lucisano
Simon Kenda
Sista Swann
Sol Amor
Sonia Jette
Stacey Boyd
Stephanie Van Hook
Steve Love
Steven Shults
Stevor Compton
Susan Englander
Susan Oehler
Susan Strong
Susan Voor Dieren
Susan Weber
Suzanne Bryant
Talia Niederman
Talida Andreea Nechifor
Teresa Anderson
Terrie C. Williams
Terry Mandel
Terry Rudd
Terrrie Frye
Timothy C. Durning
Tina Slivon
Tom Edminster
Tom Ferguson
Vern Simula
Victoria Pitchford
Wade Hudson
Wendy Marinaccio Husman
William Kruse
William McKay
Winter Peeler
Yael Astrale
Yolie Fig
Zach Rockwell

TOTAL: 263

The Trouble With Full Employment

Columbia University sign in subway station IMG 0974
Foter.com / CC BY-SA

By  Philip Harvey
Presentation at Conference on An Economic Bill of Rights for the 21st Century
Columbia University, Oct. 18, 2013

One of the things that’s always puzzled me about President Roosevelt’s economic bill of rights is how little impact it has had on the way progressives have conceived and promoted their reform agenda. While not averse to rights based policy analysis and rights based political claims—the civil rights movement demonstrated that—progressives have been hesitant to follow Roosevelt’s lead in embracing human rights norms in their analysis and promotion of economic and social entitlements.

I believe the reasons for this hesitancy are an important topic of inquiry and self- reflection, but it is not the topic I intend to pursue in my remarks this morning. Instead I want to comment on the consequences of this tendency for one key component of the progressive reform agenda—the struggle to achieve what Roosevelt referred to as the right to a useful and remunerative job.

Before I start, however, I need to say something about terminology. Specifically, I want to point out that the right to a decent job is generally referred to as the “right to work” in international human rights discourse. Indeed, this usage dates back to the French Revolution and Roosevelt himself employed it—most famously in his acceptance speech at the 1936 Democratic National Convention where he thundered against the “royalists of the economic order” who “granted that the Government could protect the citizen in his right to vote, but . . . denied that the Government could do anything to protect the citizen in his right to work and his right to live.”1

I am perfectly aware of the fact that the “right to work” phrase has very different connotations in the United States today, where it has been appropriated by right wing organizations for use as an anti-union slogan. I simply want to make it clear that when I use the term, I am using it the way President Roosevelt did.

At the same time, it is worth noting that the ability of conservatives to appropriate the term, and turn its meaning on its head, illustrates how little claim American progressives have laid to the human rights language that both Franklin and Eleanor Roosevelt championed.

In addition to illustrating Roosevelt’s use of the right to work phrase, the 1936 speech from which I just quoted also shows his predisposition—long before he delivered his economic bill of rights speech—to view access to a decent job and a secure livelihood as basic human rights.

But did he believe the right to work could actually be secured? He certainly never wavered in his insistence that it could, and the period leading up to his 1944 economic bill of rights speech seemed to give him good reason to feel confident. By 1942 the nation’s unemployment rate had fallen to 4.7 percent, in 1943 to 1.9 percent, and in 1944 to 1.2 percent. The contrast with the 1930s could not have been starker, and progressive economists were virtually unanimous in touting this achievement as proof of the Keynesian proposition that deficit spending could in fact achieve what they called “full employment”—a term just then being popularized.

It was a seductive idea because it seemed so simple and promised so much. If war-time spending could achieve full employment with such apparent ease, why couldn’t peace-time spending do the same—with American workers employed building homes and schools and hospitals instead of warships and tanks?

This was the economic and intellectual environment in which Roosevelt proclaimed his economic bill of rights. It is therefore hardly surprising that Roosevelt’s congressional allies chose to rely on the Keynesian full employment strategy when they undertook the task of drafting legislation to implement the right to work, the first entitlement on Roosevelt’s list and the one he considered the “most fundamental” of all the rights he enumerated, because it was, in his words, the “one on which the fulfillment of the others in large part depends.”2

In fact, the bill Roosevelt’s allies drafted to secure the right to work was so thoroughly Keynesian that the right itself was mentioned only once in the bill. The rest of the bill— beginning with its title—spoke only and repeatedly of achieving full employment.

No one questioned this substitution of the Keynesian full employment goal for the Rooseveltian goal of securing the right to work, because everyone—including Roosevelt— assumed that full employment meant the under-2 percent unemployment the country was experiencing at the time—a level of unemployment that was, with good reason, considered synonymous with securing the right to work.

This full employment bill never made it into law, but it did establish the strategy progressives have promoted ever since then to secure Roosevelt’s right to work goal. And that, I submit, is the reason we have failed over the past 70 years in our efforts to do so.

The problem, in my view, is that by unqualifiedly embracing the Keynesian full employment strategy, progressives hitched their wagon to a horse that simply could not make it to the top of the hill. The Keynesian strategy can drive unemployment rates down to the level at which inflation becomes problematic, but except in very unusual and hard to replicate circumstances, that level of unemployment is nowhere near low enough to insure the availability of work for everyone who wants it.

Some progressive economists, most notably Gösta Rehn and Rudolf Meidner in Sweden, were aware of this problem from the start and took steps to address it. But they were the exception, and the strategy they developed relied on institutional features of Swedish collective bargaining that do not exist elsewhere and ultimately proved unsustainable in Sweden itself.

So when the stagflation crises of the 1970s finally exposed the inflationary Achilles heel of the Keynesian full employment strategy, neither progressive activists nor progressive economists had a fallback plan. What’s worse, instead of going back to the drawing boards to develop a new strategy for securing the right to work, they simply dropped the full employment goal from their reform agenda while soldiering on in the vain hope that the progressive reform project could survive without achieving even the attenuated form of full employment that progressives had aspired to achieve in the 1950s and 60s.

But aren’t highly-respected progressive economists like Joseph Stiglitz, Paul Krugman, and Jared Bernstein once again promoting full employment? They are. But there’s a catch. The full employment goal they’re promoting is not the full employment goal that progressives viewed as synonymous with securing the right to work in 1944. Instead, it’s simply the lowest sustainable rate of unemployment they these economists believe is achievable via the policies they advocate. In other words, they’ve redefined the top of the hill as that point on its slope that the horse they’re flogging actually can reach.

This explains why Krugman and Bernstein, for example, feel comfortable referring to 5 percent unemployment as full employment, notwithstanding the fact that the last time the U.S. achieved that rate, American employers were seeking to fill only 3.9 million job vacancies while 7.5 million officially unemployed workers were actively seeking work, another 5.2 million workers were employed part time but wanted full-time jobs, and an additional 4.7 million people said they wanted a job but were not counted as unemployed because they weren’t actively seeking one. So while it’s true that the full employment goal is once again being promoted by prominent progressive economists, that’s only because they are using the term in a way that completely severs its link to the right to work.

I know there are plenty of progressives who still think of full employment the way the term was understood in 1944. Indeed, I’m quite certain this room is filled with such people. I believe, though, that the only way to reclaim that definition is for progressive activists to insist, and vociferously so, that progressive economists explain their usage of the term clearly enough and often enough that there will be no confusion as to whether the full employment goal they are promoting would in fact secure the right to work.

This does not require a rejection of Keynesian economic analysis. I want to make that perfectly clear. It only requires that the limitations of the Keynesian strategy for achieving full employment be recognized and frankly acknowledged.

And for progressive economists willing to reaffirm their commitment to securing the right to work, it means taking up the challenge of developing a new strategy for achieving that goal.

My own view is that a good place to begin that effort is with a reexamination of the New Dealer’s own efforts to secure the right to work before they invested their hopes in the Keynesian strategy.

An exploration of this history leads back to a cabinet level task force called the Committee on Economic Security that President Roosevelt appointed in the spring of 1934 to develop a set of legislative proposals that would address, in a comprehensive fashion, the economic security needs of the American people—not just during the Great Depression, but on an ongoing basis in the future.

The Committee’s final report, which was formally conveyed to the President in January 1935, proposed the establishment of the Nation’s Social Security and Unemployment Insurance systems, an income support program for poor children that evolved into the AFDC program, an income support program for poor seniors and a strategy for improving the provision of income support for the disabled poor that eventually evolved into the SSI program, and a variety of public health initiatives, including a national health insurance program (though Roosevelt asked the Committee to delete that particular proposal from its final report when it became clear that the AMA would be able to block its implementation in Congress).

In short, the Committee on Economic Security and its staff, were the architects of the American welfare state as we know it, and the Committee’s 1935 report constituted the first blueprint of that edifice.

There is, however, one element of the Committee’s overall plan that has not survived. This missing element was their proposal for achieving what they called “maximum employment,” a goal they described as the “first objective in a program of economic security.”3

Remember, the term “full employment” had not yet been popularized and it would be 13 months before Keynes’s General Theory was even published. So how did the Committee on Economic Security propose to achieve “maximum employment” without the benefit of the yet to be postulated Keynesian strategy?

Their proposal was straightforward. The federal government should back up its efforts to stimulate private sector employment (whatever form those efforts might take) with a commitment to provide temporary jobs in the public sector for those workers the private sector was unable to employ at a particular moment in time or in a particular place. In other words, the Committee proposed the use of direct government job creation to close the economy’s job gap, thereby providing workers with what the Committee called “employment assurance”— another term for securing the right to work.

Sadly, instead of fully implementing this recommendation, President Roosevelt decided for a variety of reasons to adopt the more modest goal of providing jobs for only those unemployed workers who were able to demonstrate financial need. Nevertheless, since 40 to 50 percent of all unemployed workers were able to satisfy this requirement, Roosevelt’s commitment promised a dramatic reduction in unemployment and an even more dramatic boost to the living standards and morale of the neediest members of the nation’s unemployed population and their families.

The programs used to implement this strategy were the Works Progress Administration (the WPA) and its smaller, 2-year old cousin, the Civilian Conservation Corps (the CCC). In 1936, the WPA’s first full year of operations, employment in these two programs reduced the nation’s unemployment rate by 6.3 percentage points—almost double the 3.3 percentage point decrease attributable to new private sector hiring, notwithstanding the fact that the latter was fueled by a 12.9 percent rate of real GDP growth, the fastest annual growth rate of any peacetime recovery on record.

Unfortunately, the singular ability of the WPA and CCC to drive down the nation’s unemployment rate has gone largely unnoted. In part this is because the most frequently cited unemployment estimates for the 1930s count WPA and CCC workers as unemployed rather than employed—contrary to generally accepted statistical practices today.

Another reason the job creation effect of these programs has been underappreciated is because the Keynesian framework of most such assessments focus on the impact of program spending on private sector hiring—via the multiplier mechanism—while ignoring the direct job creation effect of program hiring.

This chart shows the normally cited unemployment rates for this period in blue and the actual rates, counting WPA and CCC workers as employed, in red. Notice that the normally cited figures indicate that the nation’s unemployment rate stood at 17.0 percent in 1936, whereas the actual rate, counting WPA and CCC workers as employed, was 10.8 percent. No wonder Roosevelt was reelected that year in the largest electoral vote landslide in the nation’s history.

The same bias is apparent in the tendency for progressive to attribute the achievement of full employment during World War II to increased government spending. If we view the armed forces as a replacement for the WPA and CCC, which in a real sense they were, it immediately becomes apparent that the achievement of full employment during the war could just as easily be attributed to the direct job creation effect of military enlistments. The federal government created three times as many jobs in the armed forces during the last three years of the war than it had in the WPA and CCC combined at their peak.

So, I ask you, did World War II prove the effectiveness of the Keynesian full employment strategy or of the Committee on Economic Security’s employment assurance strategy? If this causes you to wonder what a comparison of the advantages and disadvantages of the Keynesian and New Deal strategies would show, I can only say that I think it confirms the superiority of the New Deal strategy in almost every respect. As an anti-cyclical policy this superiority can be summarized in the following five points. [SLIDE 4] 1. First, the New Deal strategy delivers aid to unemployed workers in a far more valuable form—actual wage paying jobs—than the social insurance payments favored by most progressive economists today.

2. Second, the New Deal strategy also creates far more jobs per dollar of stimulus spending. If, for example, the $787 billion fiscal stimulus authorized by the American Recovery and Reinvestment Act had instead been spent on an updated version of the WPA, paying market wages for 40-hour per week full-time jobs with full health insurance benefits, it could have reduced the nation’s unemployment rate to less than 2 percent for over two years, while simultaneously producing a larger multiplier effect on private sector employment than the ARRA did.

3. Third, the direct job creation strategy also creates jobs much faster than the Keynesian strategy. Its job creation effect is front loaded, whereas the job creation effect of the Keynesian strategy is back loaded. Page 6 of 8

4. Fourth, it is far easier to target the job creation effect of the New Deal strategy, insuring, as the New Dealers did, that if not enough jobs are created to provide work for everyone who needs it, at least those who need it the most will get the jobs that are created.

5. Fifth, whether deployed during a recession to promote recovery or as a prophylactic against recessions, the direct job creation strategy also delivers its fiscal stimulus to the private sector in a more even and effective way—by short-circuiting the process that causes unemployment to lead to more unemployment during an economic downturn, and which permits lingering unemployment to act as a drag on the economy’s recovery once the recession is formally over.

Turning to the relative merits of the two strategies as a means of securing the right to work, the superiority of the New Deal strategy is even clearer. Why? Because it has three features that should enable it to circumvent the inflation barrier that cripples the ability of the Keynesian strategy to achieve that goal.

1. First, the direct job creation strategy has a natural tendency to limit its job creation effect to those geographic locations or segments of the labor force that actually do suffer from a shortage of jobs. It is not prone, as the Keynesian strategy is, to aggravating labor shortages in some sectors of the economy while others are still mired in recession.

2. Second, because they would remain available for private sector employment, jobs program employees would perform the same inflation-fighting buffer-stock function that unemployed workers do—but without requiring anyone to suffer unemployment.

3. Third, unlike the Keynesian strategy, the direct job creation strategy can boost labor demand at the top of the business cycle without increasing aggregate demand. The trust fund financing of the nation’s unemployment insurance system illustrates how this can be accomplished.

Finally, I also want to mention one political advantage of the direct job creation strategy that I believe is extremely important—that is, its suitability for implementation at the state or local level as well as the federal level. It would cost more per capita, but progressives would not have to wait for Washington to act in order to implement the strategy in places where they possessed the political power to do so.

The only significant disadvantages of the direct job creation strategy is the difficulty of administering it. Like a public education system, a national health insurance system or a standing army, the operation of a direct job creation program capable of securing the right to work would pose an enormous administrative challenge. But that doesn’t mean it can’t be done well. The New Deal demonstrated that as well.

So, in conclusion, I think it is past due time for progressives to reassert the link between their full employment goal and the goal of securing the right to work and to acknowledge their need for a new strategy to achieve that goal. Fortunately, I think both of these tasks are doable.

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NOTES:
1 Acceptance speech at Democratic National Convention, July 1936.
2 State of the Union Message to Congress, January 1935.
3 Report of the Committee on Economic Security, January 1935.

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For fuller explanations of the arguments advanced in this talk, copies of the following may be accessed at www.philipharvey.info.

Philip Harvey on “Full Employment”

pharveyIn a comment on “If You Care About Inequality, Fight for Full Employment,” an essay by Roger Hickey, Philip Harvey offers another reason to sign the Guarantee Living-Wage Job petition. If you haven’t signed the petition yet, please reflect on his analysis and consider signing it. To sign it, click here.

In his essay, Hickey, co-director of the Campaign for America’s Future, a prominent activist organization, urges Democrats to remember that “the number one issue on the minds of voters is jobs.” And he criticized Obama’s strategy: “Have patience. The jobs are coming back.”

As an alternative, Hickey states, “Only the Congressional Progressive Caucus (with help from the Economic Policy Institute ) has put out a comprehensive proposal – the Back to Work Budget – to achieve the kind of job growth this economy really needs.”

Referring to the Republican stranglehold on the House, Hickey argues:

The way to break that conservative majority is by talking about Democratic ideas for job creation – from infrastructure spending to universal preschool education. And then you campaign, like Harry Truman, against the “Do-Nothing Republicans” who refuse to do what America needs to revive growth and create jobs.

Hickey says, “We must also expand our crusade for jobs…. And if we are serious about addressing inequality, we must fight for jobs for all.” Referring to Getting Back to Full Employment, Hickey comments, “economists Jared Bernstein and Dean Baker forcefully remind us that the fastest and most effective way to reduce inequality is to revive economic growth to the point where everyone who wants a job can find one.” He concludes, “If you care about inequality, you have to fight for full employment.”

In his comment following that post, Philip Harvey, Professor at Rutgers School of Law, who authored Securing the Right to Employment: Social Welfare Policy and the Unemployed in the United States in 1989 and served as a consultant to the Campaign to Abolish Poverty (which I founded), offered some cautionary words about Hickey’s essay. He may have overstated his case when he wisely warns about accepting the conventional wisdom about “NAIRU,” or the “non-accelerating inflation rate of unemployment,” a questionable term widely used by economists. But his warning is important to keep in mind.

Harvey posted:

Right diagnosis, but faulty prescription. The return to “full employment” Roger is promoting and which the “Back to Work budget” is designed to achieve would not in fact insure that “everyone who wants a job can find one.” What Roger and the others he cites as supporters of a return to full employment mean by the term is actually a return to the NAIRU. Their claim that this would insure the availability of enough jobs to provide work for everyone who wants it is unambiguously contradicted by the empirical evidence. We progressives rail against conservatives who continue to argue points that are clearly contradicted by the facts, but progressive economists are guilty of the same willful blindness when they refuse to recognize and acknowledge that the “full employment” policies they have been promoting since the end of World War II are incapable of achieving the kind of full employment goal they claim to be pursuing–the availability of work for everyone who wants it. The “bait and switch” rhetoric of calling for a return to full employment when what they really have in mind is a return to the NAIRU serves no useful purpose. In fact it’s counterproductive, because it tends to close off discussion of strategies that actually would achieve genuine full employment. And it really is possible to achieve that goal–notwithstanding the inflation problem that limits the effectiveness of the supposed “full employment” strategy most progressive economists are currently promoting. Rep. John Conyers’ “Humphrey-Hawkins Full Employment and Training Act” (HR 1000) illustrates the most effective of these alternative strategies. Check out the bill, and if you’d like background information on the direct job creation strategy on which it relies, and how it differs from conventional Keynesian policy interventions, you can find it in two reports I wrote in 2011–one for Demos and the other for the Big Ideas for Jobs initiative funded by the Anne E. Casey Foundation. See “Back to Work: A Public Jobs Proposal for Economic Recovery: and “Securing the Right to Work at the State and Local Level with a Direct Job Creation Program.”

I don’t know if Harvey is right when he says that Hickey accepts NAIRU as the definition of full employment, but he’s right that many progressives do. And I agree that Hickey is weak when he says, “Only the Congressional Progressive Caucus (with help from the Economic Policy Institute) has put out a comprehensive proposal – the Back to Work Budget – to achieve the kind of job growth this economy really needs.” That budget only talks about reducing unemployment to “near 5%.” And Hickey relies too much on costly, slow-to-implement infrastructure jobs, in contrast to public-service jobs that are less costly, can hire more people, and be implemented more quickly.

So I agree that we need to be clear. We should aim for what Harvey calls “genuine full employment.” That’s why I’ve been inclined to talk about increasing funding until living-wage jobs go begging due to lack of qualified applicants, which prompted Nancy Pelosi to laugh when I offered that definition in response to a question from her. She apparently considered the idea utopian.

Not everyone would take advantage of such opportunities. Some would first need to complete a substance-abuse program, for example. Others would be unreliable and not show up for work on time. But those would be few in number and they would know that when they get their act together, there would be a meaningful job waiting for them.

Personally, when I read the Baker and Bernstein book, I thought they handled the issue rather well. They did not, it seemed to me, blindly accept NAIRU, while acknowledging that moving toward full employment might create inflationary pressure. And they do clearly affirm assuring that everyone who wants to work should be able to find a job. So I believe Harvey was too harsh with his implied criticism of Baker and Bernstein.

But Harvey’s “Back to Work” report which he wrote for the Demos think tank is excellent. He discusses the issues thoroughly and convincingly. I highly recommend it.

Regardless of what Hickey, Baker, and Bernstein think, Harvey is right that we need to be careful to not use “full employment” as a euphemism. Hopefully the phrase “Guarantee Living-Wage Job Opportunities” covers the point and you will sign our petition, if you have not already done so.

 

Guarantee Living-Wage Jobs: A Call for Action

CBPP2By Wade Lee Hudson

Driving taxi in San Francisco helped me see why everyone will benefit when we see to it that everyone who wants to work can find a living-wage job. While earning an adequate, reliable income with part-time cab driving, I discovered firsthand the value of middle-class comforts and realized more clearly how a foundation of economic security will greatly improve the quality of life in the United States.

My family was working poor. In college, I wrote checks not knowing if my mother had deposited enough money to cover them. As an adult, I dedicated my life to community organizing, worked on poverty-level wages, and lived in low-income communities. I got to know that most poor people are good people who will work hard if given the chance. From direct experience, I came to better understand the frustration, resentment, anger, and social discord that results from lack of economic opportunity.

Eventually it got to me. I felt I was hitting my head against the wall, making little progress, and decided to save some money, get rid of most of my possessions, and take a long break to wander on my motorcycle. I ended up on the north coast of the Dominican Republic, living in a thatch hut with a dirt poor family with nine children.

Several other extremely poor families lived within earshot. One day I realized I rarely heard anger or crying. The contrast with San Francisco’s Tenderloin neighborhood where I had been living was dramatic. It struck me that the problem is not poverty. The problem is the lack of economic opportunity in the midst of tremendous wealth.

So long as federal policies continue to cause massive unemployment, stagnant wages, and widespread poverty while enabling the wealthy to enhance their wealth, people trying to alleviate suffering in neighborhoods like the Tenderloin will be flooded with human misery. These reflections led me to Washington, DC to work on national economic policy in order to address root causes.

My first step was to walk into the social action office of the national Methodist Church, where I offered my services as a volunteer. The director suggested that I research how to end poverty. I presented the results of my research in an article in Christian Social Action and at a seminar at the Institute for Policy Studies. These reports were well received and praised from the pulpit by Bill Holmes, my minister at Metropolitan Memorial, the national Methodist Church, with Supreme Court Justice Harry Blackmun in the congregation.

Heartened by this response, I returned to San Francisco, initiated the year-long Solutions to Poverty Workshop. We then convened the Antipoverty Congress to consider the ten-point program we developed, which detailed how to end poverty and how to pay for it. The Congress adopted our program and formed the Campaign to Abolish Poverty, which persuaded Congressman Ron Dellums to introduce the Living Wage Jobs For All Act. I then withdrew from activism to write Economic Security for All: How to End Poverty in the United States, a 320-page book.

But the time was not ripe. The results were meager. Soon thereafter I decided to take a break from activism and convened a series of “strategy workshops” to evaluate how the progressive movement might be more effective. Nevertheless, I continued to monitor developments concerning the economic-security issue, hoping that opportunities would emerge.

Then a few weeks ago I read “Democracy and the Policy Preferences of Wealthy Americans,” which reported that 68% of the general public in the United States believe “the government in Washington ought to see to it that everyone who wants to work can find a job” and 78% believe the minimum wage should be “high enough so that no family with a full-time worker falls below [the] official poverty line.”

This report was not news to me. I already knew that.

But two things were different. First, the authors used terms that were especially well chosen. They asked respondents if they believe that “the government in Washington ought to see to it that everyone who wants to work can find a job,” That phrase, “see to it,” affirms alternatives to government-funded jobs. If private businesses created enough jobs, then there would be less need for publicly funded jobs. But when that doesn’t happen, as a last resort the “government in Washington” is obligated to ramp up funding for meaningful, living-wage public-service jobs. That way of framing the issue is both more precise and more likely to meet with public approval.

If our society assured every American the means to live decently, government action would not be needed. If Pope Francis prompts a widespread moral renewal and the rich and powerful become less greedy and power hungry, our situation will be much different. But most Americans either struggle to make ends meet or live in poverty, and no relief is in sight. Given this reality, our government must help us fulfill our moral responsibility to prevent needless suffering. The American people must unite and insist that the federal government take effective action.

Second, our situation has changed. The middle class is shrinking and average wages are stagnant. It’s no longer just a matter of “helping the poor.” Most of us are in the same boat now. The only solution is to pull together. And considerable “populist” pressure seems to be building.

These factors prompted me to explore re-engaging directly with the economic-security issue. Soon, with valuable assistance and encouragement from first the Internet strategist Michael Stein and then the economist Dean Baker, I decided to initiate the Guarantee Living-Wage Jobs Campaign.

Though necessary as stop-gap measures, unemployment insurance and food stamps are no real solution. A better approach is to see to it that anyone who wants to work can find a living-wage job.

When we achieve full employment, those who are worried about food stamps fostering dependency can rest assured that we are supporting self-determination.

Business owners will benefit from a more prosperous economy.

Most workers will benefit from:
• Higher wages (because employers will pay more to keep trained employees).
• Being treated with more respect by employers (because workers will have more choices).
• Having more leisure time to relax with their families and enjoy their lives.
• Being able to engage more in their community.

Everyone will benefit from living in a more harmonious, safer society.

And people living in poverty will lift themselves out of poverty, which will greatly improve the quality of their lives.

In short, everyone will be better able to enjoy life, fulfill their potential, be true to who they really are, and participate fully in society.

Fortunately, assuring everyone a living-wage job opportunity is a simple matter. We can do it easily, and there is no good reason not to do it.

As citizens, we need not prescribe precisely how the federal government should achieve full employment. The experts and the policy makers can do that. They managed to save Wall Street. Surely they can figure out how to assure every American a living-wage job opportunity. Our job is to determine if Congress has accomplished that goal and keep pushing until it does.

We can, however, outline some options. The federal government could:
• Require paid sick time, paid family leave, and four weeks of paid vacation, as do all wealthy countries except the United States, which would lead businesses to hire more workers.
• Enable the working poor to lift themselves out of poverty by increasing the minimum wage and the Earned Income Tax Credit as necessary to assure that households earn a living wage.
• Send funds to local governments to hire public-service workers to meet needs that are currently being neglected. Those needs include teachers’ assistants, in-home caregiving, nursing home staff, child care workers, park and recreation staff, substance abuse counselors, neighborhood center staff, cultural enrichment, conservation measures, park improvements, and environmental cleanup. By steadily increasing such funding as needed, we could achieve full employment.

By relying on revenue sharing with local governments, we could minimize problems associated with “big government.” Citizens can impact City Hall more easily than they can the federal government.

Without increasing income and payroll tax rates, we could initially fund a jobs program with deficit-neutral options such as:
• A small tax on financial transactions that would discourage unproductive, destabilizing speculation and generate $100 billion or more.
• Reducing wasteful military spending that could free up $60 billion per year or more. •

If more funds were still needed, we could fund more public jobs with: 1) revenues generated by the boost to the economy that would result from this jobs program, and; 2) money that would be available from reduced spending on unemployment insurance and food stamps. Those measures would likely be sufficient to generate enough funding, but another option would be to increase taxes on the top 1%.

Clearly lack of revenue is no reason to back away from guaranteeing living-wage job opportunities. We have more than enough money.

The standard argument against full employment has been that it would cause excessive inflation. But partly due to global competition, it’s unclear how much inflationary pressure would result. Since 1997 inflation has not been a problem, even when the unemployment rate was below 5%.

Steadily increasing federal revenue-sharing for public jobs would enable the whole country to monitor this issue. Policies about inflation need to be made openly following full discussion. What is worse? Stagnant wages for the middle class, severe poverty, and widespread unemployment? Or modest inflation?

In Getting Back to Full Employment, Baker and his co-author Jared Bernstein argue that if and when inflation became a serious problem, we could deal with it then. They write, “‘It seems far better to take the risk of a short period with rising inflation than maintaining a higher-than-necessary level of unemployment…. Few would agree that it is appropriate to keep millions out of work and deny wage growth to tens of millions simply to reduce the risk of modestly higher inflation.”

The issues are clear. We need a grassroots movement to mobilize powerful, popular pressure on Washington to honor the will of the people and establish fundamental economic security. So please consider signing the Guarantee Living-Wage Jobs Petition that is addressed to “activist organizations” and reads “We urge you to work together to persuade the government in Washington to see to it that everyone who wants to work can find a living-wage job.”

Let’s build on the support we already have, develop a grassroots movement to guarantee living-wage job opportunities, and enable the United States to finally live up to its stated ideals, truly “promote the general welfare,” and support “life, liberty, and the pursuit of happiness.”

Please sign our petition and we’ll keep you informed about efforts to see to it that everyone who wants to work can find a living-wage job.

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Wade Lee Hudson has been an activist, community organizer, and writer in the San Francisco Bay Area, where he has lived since 1962. He can be reached at wade[AT]wadehudson[DOT]net. On Twitter: @LivingWageJobs

Bubbles, the Multiverse, and Humility

multiverse“Bubbles form in the expanding universe, each developing into a big or small bang, perhaps each with different values for what we usually call the constants of nature. The inhabitants (if any) of one bubble cannot observe other bubbles, so to them their bubble appears as the whole universe. The whole assembly of all these universes has come to be called the ‘multiverse.'”

from Physics: What We Do and Don’t Know
By Steven Weinberg

Ronald Dworkin on Law, Morality, and Economics

dworkin_1-110713_jpg_600x624_q85The New York Review of Books continues to be my favorite magazine. It’s the only one I read regularly. Their 50th anniversary issue  was particularly rewarding. In that issue, they published “several essays on or by writers and artists whose work meant something to us when we started.” One of these essays was “Law from the Inside Out” by Ronald Dworkin, in which he reflected on the development of his thinking from the very concrete to the abstract. This progression led him to integrate “concrete legal issues, questions of personal ethics and morality, broad political issues of social policy, and the most abstract, rarefied philosophical and metaphysical puzzles.” His conclusion was that these issues are interconnected and cannot be separated.

Early on he addressed “how courts should interpret the abstract constitutional language” and “how should judges decide what the law of some nation really is on some particular subject?” One particularly influential theory of law, legal positivism, has answered “that what the law is on some subject in no way depends on what the law ought to be.” Rather, according to this perspective, “what the law is depends … not on morality, but only on history: on what people given the appropriate authority have declared it to be.”

This approach is rooted in “anti-realism in moral theory,” which is based on “a more general theory of truth we might call ‘scientism’.”

This holds that the methods of the physical sciences provide the gold standard for any investigation, that only when these methods are available is it proper to speak of truth. According to scientism, once we see that moral argument is not amenable to scientific methods, we must abandon the idea that there is truth in morality.

Dworkin argued that this philosophy

provides only an incompetent description of the actual practice of law. Lawyers and judges typically make claims about what the law actually is that cannot be thought to be grounded just in what authoritative bodies have previously declared…. [And] a judge who sentenced a defendant to jail while admitting that the judge’s own view of the law is only an emotional expression would probably be sent to jail himself.

He pointed out that “it assumes that we share the concept of law the way we share the concept of a triangle, that is, that we all agree on the tests to use to decide whether a legal claim is true or false. But we do not.” As an alternative, he presented what he called “an interpretative theory of law” and declared, “What law is cannot be separated completely from what it should be.”

According to this theory, “An interpretation must fit the data—it must fit the practices and history it claims to interpret—but it must also provide a justification for those practices. It must, as I sometimes put it, show the practice in its best light.”

Identifying what law is therefore requires “some justification, however weak, in political morality,” which is also required in “other domains of interpretation,” such as “artistic and literary interpretation.” He tried to “show how the ‘value’ theory of interpretation illuminates the agreements and conflicts among critics in all these domains.”

However, Dworkin reported, “Most influential moral philosophers have denied this. They insist that claims about morality … are not really judgments and so cannot be either true or false.”

Dworkin considered this “anti-realist” view to be logically incoherent. He nailed his case with this brilliant summation:

Consider the proposition that rich people have no moral duty to help the poor of their own community. If that proposition is not true, then it is not true that rich people have that duty, and that is itself a moral claim. If no moral claim can be true or false, then that one can’t be true either, so anti-realism is self-defeating.

But if one agrees

there is truth in morality and politics and therefore in law. It remains to ask what truth there is. What is a life well-lived? What duties do we owe as individuals to other individuals? What duties do we collectively owe to others in politics? What is justice? Liberty? Equality? Democracy?

Dworkin answered with “two fundamental principles that I believe can provide the most coherent and attractive answers to all these questions.” These principles, the most important element in his essay, were:

First, that it is objectively important—important from everyone’s point of view—that each human life succeeds rather than fails: that people live well. Second, that each person has a fundamental, inalienable responsibility to take charge of his or her own life: that it is finally up to that person to decide what living well would mean and to pursue that life.

He then rephrased these principles in the following manner:

I argued, relying on Immanuel Kant’s thesis that no one respects his own humanity who does not respect humanity in other people, that we can define what we owe to other people as part of what we owe to ourselves. The key is the idea of dignity: it belongs to our own dignity to respect the dignity of other people.

What is fundamental to private morality, Dworkin argued, forms “the spine of public political morality as well.” He then applies this principle to economics with this insight:

We achieve true economic equality, for example, not when everyone has the same wealth, no matter what decisions he has made in the course of his life, but when what one has depends only on those decisions, and not on good or bad luck in health, accident, or inheritance. That idea of equality ties together the moral ideal of personal responsibility and the political ideals of distributive justice.

Never have I seen such an important incisive overview of how the philosophy of truth, morality, politics, and economics must all be addressed simultaneously, with clear thinking and compassion.

PopularResistance.org: An Evaluation

popularresistanceA recent email from PopularResistance.org prompted me to look more closely at their work and consider what I think of it. I concluded their approach reflects much of what is wrong with left-wing politics.

There’s much in their philosophy with which I agree, including the following:

• Forming real democratic organizations to empower local communities.
• We need to build economic democracy including worker-owned cooperatives, community supported agriculture, farmers markets, community banks and credit unions…. Of course, national policies need to be changed as well….
• People need to build their own non-hierarchical democratic institutions that bring people together to solve community problems, pool talents, resources and energy and allow real democracy to be practiced.

And in their newsletter, the authors affirm the value of certain incremental victories:

Already, the movement is seeing success from its protests, not just in changing the conversation, but in affecting policy. Medea Benjamin points out ten good things that happened in 2013 including stopping the war in Syria, negotiations with Iran, push back on Obama’s drone murders and opposition to the NSA spying program, among other things. While these victories do not constitute our ultimate goals, they show that organized people power is making a difference….

But elsewhere they reject such reforms with all-too-familiar empty rhetoric This abstract ideology contradicts their acceptance of the all-too-obvious need for reform and undermines their potential effectiveness.

In summarizing Bill Moyer’s manual, “Eight Stages of Successful Social Movements,” which they praise uncritically, they assert:

The movement must avoid becoming a mainstream group working for ‘achievable’ reforms…; instead they must remain “principled dissent groups” advocating for what is right, not what is possible….

Any reform within the current system of rule by wealth will ultimately default to a position of serving the wealthy.

Contradicting their affirmation of non-hierarchical approaches, they come down of on the side of elitism: “The primary goals are educating, converting, and involving all segments of the population.”

Toward what end? That’s left very unclear. Their definition of success is extremely ambiguous, but one option listed, “the social, economic and political machinery slowly evolve to new polices and conditions,” sounds like a series of “reforms” to me. And they speak favorably of the rise in protests in recent years, many of which are “reformist.” This inconsistency leaves a sense of incoherence.

In terms of longer term goals, though I could quibble with some of the language, I can relate to affirmations such as the following:

We need to understand that we are not a fringe movement, but a movement in the center of the best ideals of the United States. That is, we believe in a government that is truly run by the people, not by elite corporate and wealthy interests; we believe in equality under the law not special treatment for those who are politically connected and abusive enforcement against certain communities; we believe in a fair economy not one rigged for the wealthiest. This is what the majority of American people believe, but those in power violate these principles.

But if they want to align themselves with the majority, they should drop their opposition to “reform.”

And to my mind, they need to deepen the understanding of “the system,” which involves all of us who reinforce the system in countless ways. Without the consent and the participation of the overwhelming majority of Americans, our society would collapse. It is therefore overly simplistic and inaccurate to say:

Large transnational corporations currently control the political process, the judicial system, the major media outlets and education. The national security state, from the local police to the military, protect the interests of transnational corporations, both overtly through fear and physical repression, and covertly through spying and infiltration.

To try to scapegoat large international corporations simply makes no sense to me. Our situation is far more complicated than that. “Control” is not the right word to describe the enormous power exercised by those corporations, which don’t always agree with each other.

And solutions will involve much more than attacking that “enemy” and replacing those corporations with local currencies and local stock markets.

Real progress in this era of the Internet will require something other than the top-down “mobilizing” that PopularResitance.org recommends. These days, such leaders “die with their mouths open,” as Ronald Heifetz put it.

Rather, we need open, transparent, collaborative problem-solving among peers who truly respect each other. A good first step would be for the administrators of the PopularResitance.org to identify who they are on their website.

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