Too Liberal?

February 10, 2020

People claim Elizabeth and Bernie are too liberal, that their projects would beggar the country, so we can’t select them.

There must be something wrong with programs that have existed in Europe for decades. There must be something wrong and beyond our resources, with liberal programs, even though many corporate leaders support them.

Health care? The money is obviously there. People have been buying insurance forever. Employers have been paying for it for decades. And what they wouldn’t buy, the public has been paying for through emergency rooms. Let me explain the real difference. If employers pay their share through the tax system, they won’t have to worry about so-called employee benefits every time they hire someone. Even though corporations would pay about the same, the shift from a payroll expense to a public program would take the cost out of the calculus whenever business thinks about hiring someone. Or thinks about giving people a real job instead of a gig. Public programs help the economy flow. Many corporations understand that. Competition can be built in with a public option, for example. And small business would function much more easily. But false conservatives, playing on the fears of the public, don’t want to admit that they’re behind the logical eight ball.

Business could rarely get going if they had to build their own physical and social services. In fact business always wants the public to give them whatever they need. They don’t even want to build ballparks on their own dimes! But if they had to find and get water to their businesses and workers, or build their own electrical systems off the grid, or cut and pave their own roads, it would cost more and few could get started. They’d be stuck next to waterfalls like the old mills. But that’s what the fear mongers call socialism. And if they had to build all the physical and social infrastructure they need, they’d spend as little as possible and sacrifice the health of their employees. I’m not making that up – it’s the history of company towns that virtually enslaved employees, paying them in what was called company scrip. Complain and you lost your job, your home, and went into the world penniless, homeless and likely without your family as well.

Social investments protect our jobs and our freedom. Americans who know their history know that’s the world that President Franklin Roosevelt rescued us from with the New Deal by the end of the great depression. Some rich folk hated him for it because it gave most of us a chance at decent lives instead of slavery to corporate masters. Now that corporations are finding ways to take it back through the gig economy, outsourcing and union busting, we need to recreate the New Deal that gave us Social Security, unemployment insurance, the right to organize and that eventually led to Medicare. Far from being unsustainable, Americans had their best years since Roosevelt and the New Deal. And corporations too know that they can live with it because public programs give them the flexibility they want to add employees without the added expense of so-called benefits.

Too liberal? Don’t make me laugh through my tears at the ruin of the American worker.

— This commentary is scheduled for broadcast by WAMC Northeast Report, on February 11, 2020.


Globalization and Democracy

August 27, 2019

Amy Chua wrote World on Fire two decades ago, arguing that globalism and democracy would collide by bringing out ethnic and religious resentments around the globe. She identified animosities country by country that would explode when times got tough.

Many of us connected economic and democratic health. In hard times people look for scapegoats and blame each other. I’ve gotten jobs from and lost them to people of other races and genders. That’s normal and goes both ways but I did fine and don’t need to blame anyone. Many who don’t feel as well are looking for reasons.

Chua’s analysis isn’t destiny. Unions in Hawaii realized workers would do better if they were united. Hawaii developed a lovely multi-cultural society as a result. But Yugoslavia came apart in rough times. I fear the European Union and the United States can come apart if we engage in an orgy of blame.

Franklin Roosevelt focused on creating jobs in the 1930s and World War II finally pulled us out of the Great Depression. John Maynard Keynes explained that, when an economy is in the doldrums, spending and investment, by government, industry or consumers, pulls the economy out most effectively. Democrats have worked with his ideas ever since and the overall, national, economy has done well with Democrats in power, particularly when Democrats had a strong labor union base focused on workers.

But capitalism is built on creative destruction. Miners’ desires notwithstanding, other industries have been replacing coal for most of the twentieth century because coal dust and soot blanketed cities, killed plants and got into people’s lungs. The process accelerated recently as more sources of heat and power became available. It’s a benefit that capitalism allows shifts like that but also a problem that capitalism makes workers pay the greatest price for such change. Macroeconomic, Keynesian thinking helps but it doesn’t solve the harms to specific groups of workers who’ve lost out through no fault of their own. More is needed.

Republicans view the economy differently, particularly since Ronald Reagan became President, focusing on supply side economics which stresses putting more resources in the hands of companies, entrepreneurs or so-called job creators. Unfortunately, supply side economics leads Republicans to ignore what business does with money, hoping that enough will be used to create jobs at home. But business also uses their money to outsource to foreign countries, buy stock back, build monopolies and the like, which don’t help American workers. Business helps American workers when they find demand for what American workers produce. That’s not automatic.

So supply side economics leads Republicans away from strategies that would actually help workers and aggravates hard economic times that tend to push workers to fight among themselves for the available jobs. Under most conditions, supply-side economics is a smokescreen for policies that make things worse. Staying away from anything related to supply-side economics is much better for workers, brotherhood and labor unity. But the alternative Keynesian economics isn’t enough.  There is a gap with respect to finding work for areas which have lost their main industries.

To save our democracy, it’s crucial to get across what actually will help American workers and what won’t. That’s why the argument over government projects, like rebuilding infrastructure, is so important.


Our love affair with capitalism

February 25, 2019

Bernie reopened a national debate about capitalism and socialism. I think we need to understand that no economic system carried to the limit produces justice. We’ve been most successful using mixed systems to gain the advantages and smooth the problems created by both capitalism and socialism.

Actually socialism is hiding in plain sight: the post office, libraries, public schools, the water supply, fire and police protection, highways, roads and streets. We buy our capitalist cell phones on an internet system that government created for military and academic use before turning it over to private systems.

Capitalism has a fraught relationship with workers. It can and often does enlarge the total economy, the whole pie. But it doesn’t distribute that pie among the workers. It distributes the pie to those who make the decisions, and they keep what they can for themselves.

Workers and farmers have every right to be dissatisfied with the impact of capitalism on their lives. Capitalism makes farm prices unpredictable. I’m convinced the programs could be tweaked for the benefit of both the environment and of family farmers, but government programs nevertheless make prices for farm produce sufficiently predictable for farmers to stay in business.

The crumbling safety net leaves workers at the whim of other people’s investment decisions. The disruptions capitalism causes are well illustrated by the argument over the Amazon plant in Queens. There were several appropriate solutions, but the problems were clear – capitalism was preparing to push people out and their fate depended on government. Unemployment insurance and the social safety net were never enough or well attuned to the needs of families who work for others for their living. And the social safety net has been weakened considerably in the last decades along with weakening the legal position of unions. So, government has a job to do.

That doesn’t mean that we should abandon capitalism, but it does mean that capitalism is not the answer to every problem, and it’s not a sufficient answer to our economic problems. Nor are incentives for decision makers adequate answers. Capitalism is well described by the board game Monopoly. It’s so familiar, I wonder if you realized it was created to teach people what capitalism does. As its name implies, the effective object of capitalism is monopoly. Even though the holders of that monopoly change in real-world capitalism as we experience it, ordinary folks are constantly squeezed out. If our objective is the welfare of the people, capitalism is not a sufficient answer. We cannot and must not be ideological purists. Our country has been most successful when we have implemented a mixed system – capitalism as an essential disruptor, and public planning to smooth the impact for workers and communities.

There is a huge difference between saying that capitalism is valuable and the conclusion that socialism is useless, and vice versa. The truth is that both are useful, and we have to be ready, willing and able to reap the advantages of both without losing sight of their limitations.

It was my pleasure, years ago, to meet Robert A. Dahl, one of the intellectual giants of our era. He and Charles E. Lindblom teamed up to prepare a wonderful book, Politics, Economics and Welfare, to show us the different advantages of public and private action. Those of you who frequently listen to my commentary know that I often try to break the ideological mindset that only private action solves problems.

So, I’m looking for candidates this year whose answers are not ideological knee jerks for one system or the other, but who are pragmatically open to the best solutions from whatever source. Bernie is certainly right that some socialist solutions are necessary and important. Some candidates are staying clear of the word but nevertheless get the point. Any candidate who doesn’t get that point deserves a reeducation at public expense beginning with kindergarten where they might finally learn to share.

—  This commentary is scheduled for broadcast on WAMC Northeast Report, February 26, 2019.

 

 


The Economy and Those Left Behind

March 15, 2018

President Obama brought the economy back since the 2008 crash, and it grows steadily. But the rising tide didn’t lift all boats. Places like West Virginia, heavily dependent on coal mining, were left behind. I’ve taught there, knew coal mining families, shared a hospital room with one and a lovely boy in elementary school who obviously had very good taste took a shine to our daughter. I have very warm feelings about the state and am quite sympathetic.

But everything moves on. Since we lived there, coal has been reeling from competition with new forms of energy, competition from China, conversions from coal fired furnaces, and competing objectives that couldn’t be wished away, like cleaner air. China sells coal rather than burn it. So there’s little left for coal other than pandering to people with impossible dreams about irreversible changes.

Steel has become very specialized. We still produce but not all needed varieties. And production is much more automated, needing fewer, and different workers from the historical steelworker. Some steel producing communities, like Pittsburgh and Cleveland, have revived. But many capable people haven’t found comparable work in new and different industries.

They deserve consideration. Capitalism throws people away in the name of progress like so much garbage when their jobs disappear. People talk about risk as if it’s what entrepreneurs have. Actually, capitalism puts as much risk on workers, consumers and home buyers as legally possible, on those who had no responsibility for corporate failures, or the catastrophe of 2008, while it protects the financiers and CEOs. People we sometimes call average Americans or little people (regardless of their physical size) take it on the chin so that we can protect the people with the money, lawyers and control to protect themselves. American workers deserve our support.

But how? Many ideas are capable of relieving some of the distress but few will solve the problem. Trump’s tariffs on steel and aluminum will make former factory families feel taken care of. But as many economists have been pointing out, tariffs can do a lot of harm.

Education and retraining help some but it’s particularly hard for older workers to take advantage of the opportunities, often in distant places. Internet access connects some workers to distant jobs. Efforts to bring jobs to people are often based on wishful thinking – the casinos already seem to be turning into boondoggles. Some people come home for weekends from distant jobs but that’s hard to scale up without much better mass transit. Government sometimes puts programs or office buildings where they will strengthen the local economy like New York did some years ago in Harlem. Meanwhile infrastructure remains talked about and unfunded.

There are ways we can help share the wealth and should. We have to expect some good ideas to fail and some bad ones to succeed. I suspect that Trump’s tariffs will sound much better to the unemployed than what they will produce, and I think there are better solutions that a sympathetic government could develop. But yes, we should be helping.

— This commentary was broadcast on WAMC Northeast Report, March 13, 2018.


Nuts, Liars, Suckers and the Rube Goldberg Disease

November 28, 2017

I just heard that Jeff Bezos is worth $100 billion. What is he doing with that net worth? Is he putting it all to work? If not, why not? Ya think if we just gave Jeff another billion he’d put that money right to work putting Americans to work? Why can’t he do that with the $100 billion he already has?

Republicans keep telling us that if they give tax breaks to the wealthy they’ll put it to work, like another billion for Bezos. They have to be either nuts or liars. If you like nuts or liars, that’s your business. But the question is whether we are suckers.

Republicans want us to give the money to people who don’t need it in the hope that now, with even more money they don’t need, they might decide to go to the trouble of running another business and the other business would be somewhere in America and would use people and equipment made in America, or they might find others, like venture capitalists who might use the money in, by and for Americans.

Rube Goldberg, a giant of comedy who died in 1970, certainly would have gone that route in his satirical cartoons. Webster’s New World Dictionary defines Rube Goldberg as “a comically involved, complicated invention, laboriously contrived to perform a simple operation.”

The Rube Goldberg website describes “A Rube Goldberg contraption” as “an elaborate set of arms, wheels, gears, handles, cups and rods, put in motion by balls, canary cages, pails, boots, bathtubs, paddles and live animals – [which] takes a simple task and makes it extraordinarily complicated. He had solutions for How To Get The Cotton Out Of An Aspirin Bottle, imagined a Self-Operating Napkin, and created a Simple Alarm Clock – to name just a few of his hilariously depicted drawings.”

Sound familiar? We could give large tax breaks to people and companies that don’t need it on the prayer that they would use it in helpful, constructive ways, and provide decent, useful jobs to Americans.

Or to get the economy going, nationally or locally, we could just do whatever was needed. Instead of praying someone else would do it with unseemly incentives, we could build roads, bridges, updated electrical grids, schools, universities and water systems, all of which would employ lots of people and provide the resources people and businesses need to function. We might even organize cultural attractions that make places more fun and attractive. Just last week the Times had a front and multipage article on the ways the New York City subways have been starved of maintenance dollars. We’re always postponing maintenance but what do we get for that – paying the rich more for the privilege of being their patrons?

People who tell you that we have to give tax breaks to people who have money lying around that they already don’t know what to do with are either Rube Goldberg creations, nuts or liars. If you like nuts, OK. If you like liars, that’s your business. But the question is whether we are suckers.

— This commentary was broadcast on WAMC Northeast Report, November 28, 2017.


Capitalism gone wrong: Too many left behind in our divisive economy

September 19, 2017

My latest piece for The Hill discusses the set of unacceptable choices we’ve been stuck with: thinking only of national economic growth and ignoring the local fallout, maintaining industries that do national damage for the sake of local workers, leaving the workers to fend for themselves when industry departs their communities, or moving able workers to better jobs but leaving the rest in dying towns. Each of those choices is both morally and politically unacceptable. Liberals must find more compassionate solutions.

 


Taking care of each other

September 5, 2017

Americans have been celebrating the reaction to Hurricane Harvey as an example of Americans taking care of each other. There is much to celebrate. But we have also wrestled for centuries with the problem of taking care of each other – the out of work, the working poor and others struggling to stay afloat.

An economic reversal in the lives of many of us is just temporary. But it does permanent damage when it unravels peoples’ lives, leaves them with debts that spiral out of control so that they cannot hope to pay, or leaves them homeless, in broken families, or housed in barred cells. When people have little, events that would be a minor inconvenience for most of us can drop them over the cliff, unable to climb back. As the Founders recognized, all of us can expect some of our offspring to be poor. So what are the options?

Welfare has been cut back but some pieces of a social safety net remain, mostly funded by the federal government. One reason they are funded nationally is because some local governments don’t want to do anything about the problems of poverty. Another reason is that the problems fall unevenly on local governments. The process of creating suburbs and new communities is a process of seceding from the places where people have problems and therefore avoiding any responsibility under our laws about local government. By shifting the obligations upward to the feds we all share those problems at least to some degree.

We could provide jobs. Instead of just giving things and money out, we could take advantage of the time, labor and skills of people who are otherwise out of work, to get some useful things done. But the city can’t save the money that goes into the social safety net because that money isn’t city money. Albany’s Mayor Sheehan pointed that out at a house party before she was first elected. Fair point. But turning welfare money over to localities would invite them to divert the cash. Some form of cooperative federalism might be better for everyone.

Public services for everyone are also an option. We have created many sorts of services that all of us have rights to. Clean water fit to drink is a lot cheaper for everyone than buying it in bottles – provided that government isn’t asleep at the switch and doesn’t let the water supply fill with lead and other poisons. Sewage systems make everyone better off than a crazy quilt of individual efforts to deal with garbage, their own and their neighbors. And it saves a lot of money both because of economies of scale and because sewage can breed disease for all of us. Roads, bridges, sidewalks, other transportation amenities, libraries, postal services and regulated public utilities like phone and electrical service make life better for everyone. And all of them make life cheaper which is especially important for the impoverished.

In other words, making some things available for all of is good for us all and are also ways of helping the least among us. That used to be true of the health care system until we privatized it, demolished the many county, municipal and not-for-profit hospitals, only to try to restore some of the benefits of a public health system with Obamacare.

Republicans call measures like that socialism. I just call it smart, efficient and decent – Americans taking care of each other.

— This commentary was broadcast on WAMC Northeast Report, September 5, 2017.


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