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Rocky Mountain News: Opinion Columnists

Rocky Mountain News: Opinion Columnists

Rocky Mountain News


Campos: Rich-poor gap widens

May 2, 2006

Over the past generation, much mainstream economic thought has assumed that what is good for rich people is good for America. Naturally, this view has tended to transform university economics departments and business schools into cheerleaders for the Republican Party.

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Ask professor Pangloss of the University of Chicago what we ought to do about capital gains or the inheritance tax or unions, and he will dazzle you with equations supposedly demonstrating that the political outcomes sought by the wealthiest Americans are also best for society as a whole.

That, at any rate, is the current economic orthodoxy. How well does it reflect reality?

Nearly 50 years ago, the economist John Kenneth Galbraith published The Affluent Society, in which he predicted that an increasingly wealthy America was in danger of producing "private wealth and public squalor." A few years later, Galbraith advised Presidents Kennedy and Johnson as they extended the post-New Deal state in ways that lessened the hardships of poverty for millions of Americans.

The America Galbraith lived to see - he died last week at the age of 97 - became an immensely rich nation. In real terms, the gross domestic product is now five times larger than when The Affluent Society appeared, which means that, when one accounts for population growth, the average American is nearly three times wealthier.

But "average" is a tricky concept; it's been noted that if you have one foot in a bucket of ice and another in a bonfire, a statistician will tell you that, on average, the temperature is fine. Over the past quarter-century, political power has shifted from Democrats to Republicans, with striking results for the average distribution of wealth.

Since the election of Ronald Reagan the wealth of the nation has more than doubled. Per capita, Americans are now 70 percent richer than they were in 1979. Where have these several trillion dollars of new affluence gone?

For poor people, the answer is clear: Essentially none of this wealth has come their way. Adjusted for inflation, the tenth percentile of after-tax family income is almost exactly the same today as it was in 1979 - about $13,500 (note this means that 30 million Americans live on even less). For the middle class, the situation is only slightly different. In 1979, the average middle-class family had an after-tax income of $38,000; today that figure is about $43,700, meaning that over the past quarter-century the average American family has seen its income rise by about $200 per year.

For our wealthiest citizens, by contrast, 25 years of Republican rule have made these very much the best of times. During this period, the average after-tax income of the top 1 percent of Americans has risen an astonishing 111.3 percent, from $298,900 to $631,700 per year (again, all these figures are adjusted for inflation).

In other words, in absolute terms the poor are just as poor as they were a generation ago, while a middle-class family's annual share of the last quarter-century's worth of economic growth allows it to buy one extra tank of gas every three months. Meanwhile, in relative terms, both groups are far poorer: indeed, compared to the rich, most Americans are now only half as well-off as they were during the Carter presidency.

Like his intellectual mentor Thorstein Veblen, Galbraith understood that, for all its pretensions to being a science, economics has much more in common with sociology. And, like Veblen, he recognized that economists who fail to appreciate this point are particularly prone to confuse ideological commitment for scientific truth.

That so many of his academic colleagues ended up arguing that the increasingly vast gulf between America's rich and everyone else is actually a desirable state of affairs, did not, I suspect, surprise him.

Paul Campos is a professor of law at the University of Colorado. He can be reached at paul.campos@colorado.edu.

MORE CAMPOS COLUMNS »

Copyright 2006, Rocky Mountain News.

The Smirking Chimp - Tom Blackburn: 'Rise up, ye serfs with iPods!'

The Smirking Chimp - Tom Blackburn: 'Rise up, ye serfs with iPods!'

Tom Blackburn: 'Rise up, ye serfs with iPods!'
Posted on Wednesday, May 03 @ 09:49:42 EDT
This article has been read 410 times. Tom Blackburn, The Palm Beach Post

The French who marched and rallied for job security last month didn't get much sympathy in this country. Even people who impute socialist sensibilities to themselves saw the French as naÔve to demand job security in this day and age.

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The uproar started when Prime Minister Dominique de Villepin pushed through a law to make it easier to hire and fire people in the first two years on their first job. He thought that flexibility would encourage employers to try out more young people. American chambers of commerce would agree. But the young people Mr. Villepin sought to help took to the streets, proving once again that no good deed goes unpunished if the doer fails to discuss it in advance with those it is done to.

In this country, most employers can fire workers for nearly any reason, with a very few exceptions, which are endlessly complained about on talk radio. So the French furor seems, ah, foreign.

But, as New York Times economics columnist Louis Uchitelle points out in a new book, The Disposable American, massive layoffs are a recent phenomenon for big U.S. corporations. Union contracts, paternalism or management based on two-way loyalty once protected employees from discharge for anything less than incompetence or felony. Only lately did massive discharges to boost the stock price become normal. The practice grew in Ronald Reagan's administration and was ratified in Bill Clinton's.



Now, it seems that life was ever thus. Local and temporary shortages aside, it's a buyer's market for labor. Business Week reports that U.S. collegians with math skills now stay away from computer programming courses because they expect most of those jobs to be in India when they graduate. The needle trades migrated from New England and New York to east Asia. Other jobs followed. Job security went the way of whitewall tires.

It isn't that Americans can't work. They are among the world's most productive individuals. The French are among Europe's most productive. Being good at what they do doesn't protect them, either.

This, we are told (by economists who don't get laid off), is the result of immutable laws of free markets in an era of globalization. Joseph Schumpeter called it "creative destruction." The French call it "Anglo-American capitalism" and spit on it. They demand what they call "European capitalism," which simply means the good old days.

The fact that there were more humane old days - even if they weren't as good as recalled - implies that the dominant form of global capitalism isn't the only possible form of capitalism.

For his book, Mr. Uchitelle followed airline mechanics laid off from a good job in Indiana. Hardly any did as well financially, psychologically or spiritually in their next job. The "solution" - embraced, without evidence, by both political parties - is more education and training. That didn't work for the mechanics. Why would it?

If work as skilled as fixing airplanes is outsourced to cheaper mechanics, there isn't much to retrain for. If the value of the old skill was cut in half, the next skill probably will be devalued as well.

Older people tend to resent being treated as throwaways, although some of the airline mechanics accepted it equably at first. Young people, who think they are bulletproof, seem to find it easier to internalize the proposition that their employer owes them nothing but this week's paycheck. The flip side is that they owe the employer no more than what the paycheck buys.

Most workers in recorded history lived with jobs that could never get lighter or more rewarding. They were serfs. It is odd, though, for Americans to passively accept becoming serfs with iPods in the name of market economics.

At the least, you would expect them to ask questions like: Why do chief executives who impose layoffs need to get several hundred times their average employee's wage plus a golden retirement? Supposedly, what they are doing has no relation to their wisdom or abilities but mindlessly follows the implicit but irresistible demands of the market.

That's the kind of question Europeans have been asking of their much lower-paid CEOs with a great clamor. Over here, no one even asked what the noise is about. When did Americans start doing as they are told? Considering the results, why?

Tom Blackburn is a columnist for The Palm Beach Post. His e-mail address is tom_blackburn@pbpost.com

Copyright © 2006, The Palm Beach Post.

Source: The Palm Beach Post
http://www.palmbeachpost.com/opinion/content/opinion/epaper/2006/05/01/a16a_blackburncol_0501.html

DIRELAND: FRANCE: WHY THE STUDENTS WON

FRANCE: WHY THE STUDENTS WON

This morning in Paris, the conservative government of President Jacques Chirac (left, with Prime Minister Dominique de Villepin behind him) caved in and announced that the special labor contract for under-26 workers that had sent millions of students and union members into the streets in protest was dead. The "CPE" (Contrat Premier Embauche or first-job contract) will be "replaced" by a new plan to provide subsidies to employers to encourage the hiring of young people in a country where youth unemployment is at 24% (and even higher -- upwards of 50% -- in the ghettos.)

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What was behind this profound social crisis that had shaken France (where I lived for a decade) for over two months? As usual, the U.S. press understood little about the conflict. Over and over again, one heard the students referred to by TV's bubbleheads (from CBS to CNN) as "reactionaries" because they opposed the new law. But what the CPE law had done was to eliminate for under-26 workers the rights previously guaranteed to all French workers not to be fired without cause. Under the CPE, younger workers could be canned at any moment from the moment of their hiring up the two years' duration of these youth employment contracts without the employers' being required to justify the firing, if the fired worker chose to haul the employer before labor tribunals. Calling the student-union defense of preserving acquired workers' rights "reactionary" is equivalent to labeling as "reactionary" any American who wants to preserve the Social Security system. It is a perversion of language -- for it was the CPE law itself which was quite reactionary.

The good folks at FAIR (Fairness and Accuracy in Reporting) have released an excellent study of conservative media bias in US media during coverage of the French crisis. And U.S. TV kept showing pictures of the rioting by a handful of delinquents from the ghettos who attached themselves to the huge peaceful demonstrations -- even though they represtned only a few hundred people, compared to the upwards of 2 million students and workers who poured into the streets of 150 French cities and towns on two occasions in the last two weeks. (Photo upper right, anti-CPE demonstrators fill the streets of Marseille.)

But what was really behind the disputed CPE labor law was a sordid quarrel between the two leading contenders for the conservatives' presidential nomination in 2007. Prime Minister Dominique de Villepin, the man behind the CPE, has always had the reputation as a "social Gaullist," part of the much-diminished wing of the former Gaullist political movement of which Chirac's UMP political party is the heritor. The "social Gaullists" were firm believers in the French welfare state. But there are very few "social Gaullists" left in the conservatives' ranks, and the right's leading contender for their 2007 presidential nomination -- current law-and-order Interior Minister Nicolas Sarkozy (left), who is also the UMP party's elected chairman -- is hard-right on economics, and has made a staple of his presidential campaign a radical "rupture," as he repeatedly puts it, with the French social model of a welfare statewith guaranteed income and health care that includes completion of the privatization of all enterprises in which the state has part or total ownership (a privatization campaign begun under the late Socialist President Francois Mitterrand in the early 1980s.)

With the CPE, de Villepin hoped to give himself a conservative face-lift to boost his chances with the UMP party's members, who will select their 2007 presidential nominee. And, indeed, several polls taken during the crisis showed that the CPE labor contract was supported by some two-thirds of the conservative party's membership.

But de Villepin's strategy backfired with the larger electorate -- poll after poll showed that the CPE was opposed, not just by students and union members, but by 2/3 of all the French. Economists of both right and left were nearly unanimous in saying that the CPE would have little impact on youth unemployment, it's ostensible purpose.

De Villepin's problem is that he has never been elected to any public office and has never had to face the voters on his own. De Villepin (left) spent most of his career as a diplomat in France's foreign ministry before becoming, as Secretary-General of the Elysee Palace, President Chirac's chief of staff. De Villepin's tin ear for the electorate was amply demonstrated in 1995, when he persuaded Chirac to dissolve parliament and thus call early elections, figuring that the factionalized Socialist Party would be caught short and that the conservatives would reinforce their majority. Of course, the opposite happened -- those early elections saw a sweeping legislative victory for the Socialists that brought Lionel Jospin to the premiership. As the author of that disaster, de Villepin has been generally detested for years by the parliamentary conservatives in Chirac's party and by the party's apparatchiks.

Now Villepin has once again confirmed that he is electorally tone-deaf by refusing for months to abrogate the CPE labor contract despite the entire country's opposition to it. His stubbornness provoked the most massive street demonstrations France had seen for decades, the shutting down of over 69 universities and of some 1200 high schools, by student blockades (and just before exam-time, too). Moreover, the protests were starting to seriously hurt the French economy -- the students were engaging in lightening blockages of factories, rail lines, highways, and center cities. One of the most audacious came when students blockaded the national food distribution center at Nantes. More blockages had been promised for the future, especially tomorrow (Tuesday), when the student coalitions and student unions had called for another huge national demonstration (a call they're maintaining to emphasize their victory and to keep pressure on the political classes to come up with real programs to fight youth unemployment.)

Under pressure from employers worried about the protests' economic effects as well as from the French in the street, and from the conservatives own parliamentary majority (where the closer-to-the-ground deputies in the National Assembly feared for their own seats), Villepin had to back down. But both he and Chirac (who maintained his public support for Villepin throughout the crisis) have come out of this social conflict with hugely diminished popularity. A poll released this past weekend by Le Monde showed that 86% of the French said that Villepin had been "weakened" by the crisis over the CPE -- and 85% said the same of Chirac. Moreover, a poll for the newsweekly l'Express last week showed that Villepin's approval rating had dropped 14 points in a month, to only 26%. His presidential rival for '07, Sarkozy, on the other hand, has not suffered too much -- his popularity is holding at a 53% approval rating.

It's hard to see Villepin coming back from this very personal disaster. Disavowed by a majority of his own party's legislators, disliked by a huge majority in the country, the aristocratic prime minister will have difficulty in climbing out of the hole he dug for himself. All the more so because his government's cave-in signifies that not just France's young people but the entire country were held hostage to his personal ambition and his attempted political face-lift, for nought. The country is unlikely to forgive him.

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The Strange Case of the American Worker | BaltimoreChronicle.com

The Strange Case of the American Worker | BaltimoreChronicle.com

by Don Monkerud

Americans spout the anti-government beliefs fed to them by hundreds of think tanks supported by the richest of the rich, corporations seeking to avoid government regulation and taxes, churches seeking a return to the Dark Ages, and other right-wing forces that promote agendas to control the country.

Several years ago in Florence, I joined a march with thousands of working people, protesting the Italian government's raising of the retirement age. Formerly, workers could retire after 35 years of work, but a new law wouldn't allow them to receive a pension until they turned 65.

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My wife pointed out the irony of marching in solidarity with workers who had rights Americans can't imagine. Later, several Italians demanded to know why the average American worker doesn't have health insurance, higher wages, better retirement benefits, more vacation time, and rights that Italian workers take for granted. How can we be so stupid? I had a hard time explaining why Americans support millionaires and billionaires instead of taking up for themselves. They never did understand, and I don't either.

When I returned home, California voters rejected a law that would have provided health care for more workers, paid for by employers. The law had passed the legislature and been signed by the governor, but before it could be implemented, corporations convinced voters to place it on the ballot. Strangely enough, rising health care costs were at the top of the list of voter's concerns and they still voted against it.

As French students and workers march to protest a new law that will allow employers to fire employees without cause during their first two years of employment, one might expect American workers to sympathize with them. They don't. When I said I was on the worker's side, one friend criticized me for taking sides instead of considering all sides of the issue. Another minimum-wage friend became agitated when I protested tax cuts for the rich and claimed, "I haven't given up the dream of getting rich someday."

Many of us don't consider ourselves workers, although 80 percent of us work for an hourly wage, which has barely kept up with inflation over the past 30 years. The rich, with our voting support, are doing fine. The top 20 percent account for almost half of consumer spending, while the bottom 80 percent share the remaining 54 percent. Since 1984, 30 million full-time workers have been laid off and forced to take lowering-paying jobs, while the richest one percent of households increased their share of corporate wealth from 39 percent in 1991 to 59 percent today.

The media response to the French workers strike may indicate why American workers fail to vote for their interests. Despite right-wing claims of the "liberal" media bias, the media reinforces attitudes detrimental to working people. A recent analysis of the coverage of the French strikes in the American press by FAIR (Fairness and Accuracy in Reporting) a media watchdog group, illustrates where Americans get their attitudes.

A Los Angeles Times editorial recommended that the French demand that all job guarantees be loosened, while the "liberal" New York Times suggested the French loosen "rigid labor laws" and trim "costly benefits." Fox News said, "workers don't want to work" and claimed the French are angry because they can't get "a lazy do-nothing job." ABC and CBS both derided the protesters, and when asked about the injustice of allowing bosses to lay off workers without cause, one reporter said, "But it is this way the world over."

U.S. News & World Report ignored the fact that French workers are more productive than Americans and lectured the French about their 35-hour workweek, six weeks paid annual leave, and job security, which are going the way of "the dodo bird." Fox's Bill O'Reilly condemned what he called American "socialism" that would guarantee workers "a house, health care, a nice wage, (and) retirement benefits."

Americans spout the anti-government beliefs fed to them by hundreds of think tanks supported by the richest of the rich, corporations seeking to avoid government regulation and taxes, churches seeking a return to the Dark Ages, and other right-wing forces that promote agendas to control the country. Every week they release hundreds of op-eds, reports, TV shows, commentaries and well-honed arguments to convince people to identify themselves as independent, laissez faire individualists who oppose any government program to regulate workers trading their time for a paycheck.

It's a wonder that American workers support the 18th century robber baron agenda of the Republican Party, a party that constantly votes against their interests: tax cuts for the rich; judges who support monopolies and almost always rule in favor of corporations; destruction of the environment; deregulation of rules that protect consumers and workers; support for an avaricious military-industrial-pharmaceutical complex; rampant business and Congressional corruption; and a Congress that refuses to raise the minimum wage, while raising its own pay seven times in eight years.

It's time we start identifying with other working people and find common cause in correcting injustices and stopping legalized corruption.

Working people are not here to create a wealthy ruling class: it's time for us to demand that our interests be protected and that a minority of people stop getting the lion's share of society's benefits. It's time we start identifying with other working people and find common cause in correcting injustices and stopping legalized corruption. At a minimum, it's time for us to vote for our own interests and to take to the streets when our interests are ignored.
©2006 Don Monkerud. The author is an Aptos, California-based writer who follows cultural, social and political issues.

Good News! The Rich Get Richer

Fairness & Accuracy In Reporting (FAIR)
http://www.fair.org

Extra! March/April 2006

Good News! The Rich Get Richer
Lack of applause for falling wages is media mystery

By Janine Jackson

The Bush administration made a concerted effort to trumpet a “booming” U.S. economy in early December, widely understood as an attempt to reverse what polls indicate to be the public’s largely negative views on the matter.

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There are, of course, obvious reasons the majority of Americans dissent from the White House’s rosy presentation of the economy: Most American households are not, in fact, seeing their economic fortunes improve. GDP is up, but virtually all the growth has gone into corporate profits and the incomes of the highest economic brackets. Wages and incomes for average workers, adjusted for inflation, are down in recent years; the median income for non-elderly households is down 4.8 percent since 2000 (Economic Policy Institute, 8/31/05). The poverty rate is rising, as is the number of people in debt.

But rather than confront these realities, and explore the implications of the White House’s efforts to deny them, most mainstream media instead assisted the Bush team’s PR by themselves feigning confusion over the gap between the official view and the public mood.

As the New York Times put it (12/6/05), the economy “has improved in the past two years, though polls show that most people think it has gotten worse.” USA Today (12/5/05) had it that “despite positive economic numbers, polls show that many Americans believe the economy remains weak.” And the Los Angeles Times (12/6/05) referred matter-of-factly to economic “good news,” noting Bush’s concern that “voters give him little credit for the improving economy.”

Again and again, the majority of Americans’ understanding of their own economic situation was presented as somehow disconnected from reality, ascribed to “pessimism,” ignorance or irrationality. The Wall Street Journal (12/6/05), among others, suggested poll respondents’ negative assessments might be “spillover from concerns about the Iraq War,” as if the war rendered people incapable of noting whether or not they can pay their bills.

Conservative pundit George Will (ABC’s This Week, 12/4/05) blamed media coverage for the public’s failure to understand that “the economy is booming,” attributing this misapprehension to “Will’s two laws of economic journalism,” which mandate that “there’s no such thing as good news.” On Fox (Special Report, 12/2/05), Charles Krauthammer likewise cited the press, which “emphasizes the negative,” for the fact that the public didn’t appreciate the “incredible resilience of this economy,” which he called “a tribute to the tax cuts which kept our economy strong.”

Even the inclusion of significant countervailing data, like sluggish wage growth or escalating healthcare costs—data that demonstrate that Bush’s vision of an economic horizon “as bright as it’s been in a long time” (UPI, 12/2/05) is simply not the reality for most people—was insufficient to shift the story from one of essentially “good news.” The most outlets could manage was to say that such factors suggest “that recent gains in the economy do not apply across the board” (L.A. Times, 12/6/05), that many workers are not “fully participating in the economy’s gains” (Wall Street Journal, 12/6/05), or that “many economic benefits are not making their way to ordinary workers” (Washington Post, 12/6/05). But why these ordinary workers, representing the majority of households, should not be considered the arbiters of whether or not “the economy” is good is never explained.

There were a couple of high-profile exceptions to this upside-down framing, in which the existence of an “upswing” was taken as a given and journalists sought only to account for the public’s failure to “get” it, or to sufficiently credit the White House. Former Labor Secretary Robert Reich (ABC’s This Week, 12/4/05) pointed out that the much-cited report of 215,000 new jobs created in November, which Bush held a Rose Garden ceremony to crow about, was “nothing to celebrate,” noting that it was less than the average per month growth in the Clinton administration, and that 150,000 new jobs are required just to keep up with population growth. Reich urged consideration of job instability along with health care and energy costs.

The New York Times’ Paul Krugman was likewise direct. “Americans don’t feel good about the economy because it hasn’t been good for them,” he wrote (12/5/05). While “GDP growth has been reasonably good, and corporate profits have soared” in recent years, Krugman explained, “most families actually lost economic ground,” with real median household income falling for the fifth year in a row.

But in their hardly radical suggestion that discussion of the economy ought to reflect the concerns of average salaried workers at least as much as those of the investor class, the likes of Krugman and Reich are not just a tiny minority in media opinion forums; they are effectively shouted down by a daily litany of stories that privilege the views of economic elites—with the most significant biases often lurking in the unspoken premises and parameters of supposedly neutral, “straight” reporting.

Media’s tendency to tacitly promote the official storyline came through in the decision by a number of outlets (ABC’s Good Morning America, NBC’s Today, CBS’s Early Show, CNN’s American Morning, 12/5/05) to “cover” Bush’s economic stumping with solo interviews of White House counsel Dan Bartlett; and in the ubiquitous tactic of bracketing straightforward information that might undermine the White House view as the detractions of “Democrats.”

Thus for the L.A. Times (12/6/05) it was only “Democrats” who were “not persuaded by Bush’s upbeat rhetoric, arguing that his policies, especially the across-the-board tax cuts, have disproportionately benefited the wealthiest segments of society.” Having devoted the first 15 of 17 paragraphs to unchallenged stenography of Bush and his advisers, AP’s account (12/5/05) offered a comment from Senate Minority Leader Harry Reid, prefaced with the line, “Democrats were quick to criticize the president’s speech.”

Ingenuous reporting of Bush rhetoric was pervasive, as with his exhortation of corporate America to “keep your promises” to workers. That phrase made headlines, but reporters merely wrote it down, rather than take the somewhat obvious step of researching Bush’s record on the issue. As David Sirota noted (Huffington Post, 12/6/05), a quick Google search would’ve shown Bush’s “major concrete action” in this arena to be his push to legalize controversial “cash balance pensions” schemes, though government auditors have said these reduce the pensions promised to longtime workers (New York Times, 3/9/03).

Finally, there is the gaggle of unabashedly pro-business shows like CNBC’s Kudlow and Company, where Treasury Secretary John Snow was invited (12/5/05) to exult, “There’s just so much good news,” and to explain that that’s due to Bush and “his leadership in lower taxes that created the condition under which this economy could take off.” Kudlow also gave Snow a chance to respond to Paul Krugman (described by the host as a “Princeton economist and so forth and so on”) with a supply-side primer about how “high returns to capital” lead directly to “better wages and better compensation.”

Nowhere in mainstream media do such shows have an opposite number, in which progressive economists regularly lay out their worldview at length and in hospitable company. Or even a show where labor, poverty or consumer rights organizations get to respond directly to the selective numbers and analysis put forward by the administration.

Such a program couldn’t balance the slant of a press corps that headlines economic “good news” when most families fall behind; but it would be a start.

See FAIR's Archives for more on:
Economy

The Right and the Left, in a Nutshell

The Right and the Left, in a Nutshell
Introduction to "Conscience of a Progressive," a Book in Progress.

Ernest Partridge, Co-Editor
The Crisis Papers
March 13, 2006



Those of us who are at middle age or beyond have lived through a revolution in political and economic theory and practice, a revolution so profound that few of us can even begin to appreciate its significance, much less its peril.

Future historians, however, will understand and appreciate this revolution and will wonder at the passivity of the public today and the ease with which those who instituted this upheaval achieved their success. The same historians, I would venture, will be equally or more amazed at how this moment played out. But this we cannot know, for their past is our immediate future. We are the agents of that still-to-be written history. The United States of America, in this year of 2006, is at a hinge of history. Our fate, and that of our successors, rests directly in the hands of all of us who are politically alert and active today. As Edward R. Murrow famously said, “we can deny our heritage and our history, but we cannot escape responsibility for the result."

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Those factions and interests now in control of the United States government declare that their policies, which they choose to call “conservative” and I prefer to call “regressive,” are an advancement in the course of human history. Those who disagree, and the pollsters tell us that they are a majority of the American people, believe that in the past five years, and arguably in the past twenty-five years, the people of the United States and their government, have suffered a grievous setback.

I count myself among this dissenting majority. In my book, "Conscience of a Progressive," now nearing completion, I attempt to articulate that dissent, criticize the foundational dogmas of the regnant, “regressive” regime that now controls our country, and justify the principles of “progressivism” – the political-economic ideology that distinguished and honored our past, and if we are both determined and fortunate, may once again guide and enrich our national future.

Here, briefly, are the “players” in this political contest.

The Regressives:

To begin, it is important to note that the regressivism that controls and supports our present government is not a unified political doctrine. Rather, it is a coalition, some factions of which are in strong disagreement with others, most notably “the libertarian right” and “the religious right.”

In general, most regressives tend to believe that the ideal society is merely a collection of autonomous individuals and families in voluntary association. In fact they assert that strictly speaking, as Dame Margaret Thatcher once proclaimed, “There is no such thing as a society -- there are individuals and there are families,” and Ayn Rand, “There is no such entity as ‘the public’ ... the public is merely a number of individuals. ” It follows that there is no such thing as “public goods” and “the public interest,” apart from summation of private goods and interests. Moreover, there are no “victims of society.” The poor choose their condition; poverty is the result of “laziness” or, as the religious right would put it, a “sin.”

Each individual, by acting to maximize his or her personal self-interest, will always act “as if by an invisible hand” (Adam Smith) to promote the well-being of all others in this (so-called) “society:” that which is good for each, is good for all. Accordingly, the optimal economic system is a completely unrestricted and unregulated free market of “capitalist acts by consenting adults.” (Robert Nozick) Moreover, private ownership of all land, resources, infrastructure, and even institutions, will always yield results preferable to common (i.e. government) ownership and control. Finally, the regressives firmly believe that because economic prosperity and growth are accomplished through capital investment, the well-being of all is accomplished by directing wealth into the hands of “the investing class;” i.e. the very rich, whereby that wealth will “trickle down” to the benefit of all others.

The libertarian right insists that the sole legitimate functions of government are the protection of the individual’s unalienable natural rights to life, liberty and property. The libertarian’s demand for individual autonomy and government non-interference entails a tolerance and respect for privacy, and thus the libertarian has no use for sodomy and drug laws, for laws prohibiting gay marriage, abortion, voluntary euthanasia, and least of all for government endorsement of religious dogma or enforcement of religious practice. Thus the libertarian fully endorses John Stuart Mill’s pronouncement that, “over himself, over his own body and mind, the individual is sovereign.” In general, the libertarian advocates the fullest possible freedom of the individual, consistent with equivalent liberty of all others. In these respects, there is much of libertarian thought that should be attractive to the progressive.

The religious right, of course, vehemently rejects the libertarian’s uncompromising tolerance and insistence that the government has no right whatever to interfere in the private life of the individual. The religious right, to the contrary, believes that the government is entitled to enforce moral behavior and even to support religious institutions and “establish” religious doctrines in the law. In the most extreme cases, the religious right advocates the establishment of “biblical law” in place of our present system of secular Constitutional law.

With the exception of the dispute between the libertarians and the religious right regarding private behavior, all the other tenets of regressivism share this characteristic: They all lead to policies that benefit wealth and power (“the masters”), to the disadvantage of all others; i.e., the “ordinary citizens.

The Progressives:

“Progressivism” is essentially the “liberalism” of most of the twentieth century, as promulgated by both Roosevelts, by the Kennedy Brothers, and by many Republicans, such as Dwight Eisenhower, Jacob Javits and Earl Warren. “Progressivism,” to put it simply, is “liberalism,” free of the slanderous connotations heaped upon it by contemporary right-wing propagandists.

In general, progressives endorse the political principles of our founding documents, the Declaration of Independence and the Constitution, as well as the fundamental moral precepts of the great world religions and the ideas of many secular moral philosophers – precepts most familiar to the American public through the moral teachings of Jesus of Nazareth.

Accordingly, progressivism is founded on enduring “conservative” principles. Thus the familiar “liberal vs. conservative” dichotomy is a hoax. Moreover, the Right, far from being “conservative,” in fact endorses a radical political doctrine, with policies designed to return society and the economy to a condition of autocracy, wealth and power for the privileged few, and servitude, poverty and ignorance for “the masses” – a condition which, until recently, was generally believed to be permanently discredited and relegated to the distant past. Hence my preferred term, “regressive.”

In contrast to the regressive, the progressive regards society not as an aggregate of autonomous individuals but as an “emergent” entity that is more than the sum of its individual human components. In this sense, a society is like a chemical compound such as table salt or water: substances with properties that are separate and distinct from the properties of their component elements. It then follows that there are “social goods” and “public interests” that are demonstrably separate from the sum of private goods and interests. Moreover, there are genuine “victims of society” who are in no way responsible for their suffering and poverty. (The illegitimate child of a teen-age heroin addict did not choose her parents. The decision to “outsource” a job was out of the hands of the worker who loses that job).

Because society (or “the public”) is demonstrably distinct from the sum of its component individuals, behavior that might be good for each individual, may be bad for society as a whole; and conversely, what is “bad” for the individual (e.g., taxes and regulations) may benefit society at large. These fundamental precepts: “good for each, bad for all” and “bad for each, good for all” are of essential importance to the defense of progressivism, and by implication to the refutation of regressivism.

The progressive is not “against” free markets, but rather believes that in the organization and functioning of society and its economy, markets are invaluable servants. But markets can also be cruel masters. Thus, in the formulation of public policy, markets should count for something and even for much, but not for everything. There is a “wisdom” of the marketplace, but that “wisdom” is not omniscient. Adam Smith was right: each individual seeking his own gain might act, “as if by an invisible hand,” to the benefit of all. But as Adam Smith also observed and regressive economists tend to forget, there is a “back of the invisible hand,” whereby self-serving action by each individual can bring ruin upon the whole – a warning that was vividly presented by Garrett Hardin in his landmark essay, “The Tragedy of the Commons.” (1968)

The progressives are so much in favor of a market economy that they are determined to protect it from its excesses and from its inborn tendency toward self-destruction. The progressive recognizes that the natural tendency of “free markets” is toward monopoly and cartels, which are, of course, the end of the free market. Thus the progressive endorses anti-trust laws, which means, of course, a rule of law enforced by government.

The progressive also recognizes that market transactions, especially those by large corporations, affect not only the parties of those transactions (the buyers and sellers), but also unconsenting third parties, the “stakeholders;” for example, citizens who reside downwind of and downstream from polluting industries, citizens who are enticed by false advertising to endanger their health, and parents whose childrens’ minds and morals are corrupted by mass media. “Stakeholders” should thus have a voice in these corporate transactions, and the only agency with a legitimate right to represent the stakeholders is their government; hence the justification for regulation of corporations.

The progressive agrees that economic benefits “trickle down” from the investments of the wealthy. But he also insists that the wealth of the privileged few “percolates up” from knowledge and labor of the producers of that wealth – the workforce – and from the tranquility and social order that issues from a public that is served well by, and freely consents to the rule of, its government. The progressive insists that the workers are most productive and prosperous when they participate, through collective bargaining, in determining the conditions of their employment. The progressive also recognizes that the productivity of that workforce results from public education and from the publicly funded basic research that might otherwise be neglected by private entrepreneurs.

In addition to the libertarian’s defense of government’s function of protecting the rights of “life, liberty and property,” the progressive believes that it is also the function of government “to establish Justice, insure domestic Tranquility, ... [and] promote the general Welfare." Critics of The Right, who choose to call themselves “conservatives,” should note that these words are quoted directly from the Preamble to the Constitution of the United States.

Also, along with the libertarians, the progressive endorses the “like liberty principle” which affirms that each individual is entitled to maximum liberty, consistent with equal liberty for all. Likewise, the “no-harm principle,” expressed in the familiar folk maxim, “my freedom ends where your nose begins.” However, the libertarians fail to come to terms with the full implications of these principles, for their program results in freedom for the privileged few at the cost of the freedom and welfare of the many. To put the matter bluntly, the progressive disagrees with the libertarian, not because the progressive values liberty less, but because he values liberty more.

The progressive insists that certain institutions and resources are the legitimate property, not of private individuals, but of the public at large. These include, first of all, the government itself: the legislature, the executive, and the courts. In addition, the natural environment – the atmosphere, the waterways, the oceans, the aquifers, wildlife – can not be parceled out, marked by property lines, and sold to the highest bidder. Language, the arts, literature, the sciences, are common heritages which must be protected and nurtured for the common good, and not be used and exploited exclusively for private gain.

Finally, the progressive demands that government belongs to the people, and not exclusively to those interests that can afford to “buy into” access to and influence upon the government. “Governments,” the progressive reminds us, “are instituted among Men, deriving their just powers from the consent of the governed,” and that “whenever any Form of Government becomes destructive of these ends, it is the Right of the People to alter or to abolish it, and to institute new Government.” And if the (self-described) “conservatives” find such sentiments to be treasonous, they should again take note of the source. These words are from the founding document of our republic: The Declaration of Independence.

Accordingly, far from being “traitors,” as Ann Coulter would have us believe, progressives are among the most authentic of patriots.

Copyright 2006 by Ernest Partridge

This book, "Conscience of a Progressive," needs a publisher. If you are a publisher, an agent, or can direct me to same, please contact me at gadfly@igc.org. Dr. Ernest Partridge is a consultant, writer and lecturer in the fields of Environmental Ethics and Public Policy. He publishes the website, "The Online Gadfly" (www.igc.org/gadfly) and co-edits the progressive website, "The Crisis Papers" (www.crisispapers.org).

JEFF FAUX: The Party of Davos

This article can be found on the web at
http://www.thenation.com/doc/20060213/faux
The Party of Davos

by JEFF FAUX

[from the February 13, 2006 issue]

The world's movers and shakers are convening once again in January at the annual World Economic Forum in Davos, the posh ski resort nestled in the Swiss Alps. Attendance is invitation-only, enforced by police barricades, razor wire and the latest high-tech military hardware to guard against terrorists, protesters and curious local citizens.

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Some 2,000 people will show up to discuss the world's problems as defined by those who own and manage the great global concentrations of wealth (Microsoft, Citigroup, Siemens, Nestlé, Nomura Holdings, Saudi Basic Industries, etc.). Their guests include prominent political leaders, international bureaucrats, academics, consultants and media pundits--with a few NGO and labor union officials sprinkled along the edges to demonstrate diversity.

Davos is not the place for secret conspiracies. More than 200 hovering journalists will dispatch to the world's citizens breathless accounts of the chatter and charm of the masters of the economic universe. Davos is rather the most visible symbol of the virtual political network that governs the global market in the absence of a world government. It is more like a political convention, where elites get to sniff one another out, identify which ideas and people are "sound" and come away with increased chances that their phone calls will be returned by those one notch above them in the global pecking order.

Americans are of course prominent members of this "Party of Davos," which relies on the financial and military might of the US superpower to support its agenda. In exchange, the American members of the Party of Davos get a privileged place for their projects--and themselves. Whether it's at Davos, at NATO headquarters or in the boardroom of the International Monetary Fund, heads turn and people listen more carefully when the American speaks.

"Davos Man," a term coined by nationalist scholar Samuel Huntington, is bipartisan. To be sure, Democrats tend to be more comfortable with the forum's informal seminar-style and big-think topics like global poverty, cultural diversity and executive stress. Bill Clinton goes often, and Al Gore, John Kerry, Robert Rubin, Madeleine Albright, Joe Biden and other prominent Democrats are familiar faces. Republicans generally prefer more private venues. George W. Bush, of course, doesn't do anything unscripted. But people like Dick Cheney, Newt Gingrich, John McCain and Condoleezza Rice have all worked the Davos circuit.

That the global economy is developing a global ruling class should come as no shock. All markets generate economic class differences. In stable, self-contained national economies, where capital and labor need each other, political bargaining produces a social contract that allows enough wealth to trickle down from the top to keep the majority loyal. "What's good for General Motors is good for America," Dwight Eisenhower's Defense Secretary famously said in the 1950s. The United Auto Workers agreed, which at the time seemed to toss the notion of class warfare into the dustbin of history.

But as domestic markets become global, investors increasingly find workers, customers and business partners almost anywhere. Not surprisingly, they have come to share more economic interests with their peers in other countries than with people who simply have the same nationality. They also share a common interest in escaping the restrictions of their domestic social contracts.

The class politics of this new world economic order is obscured by the confused language that filters the globalization debate from talk radio to Congressional hearings to university seminars. On the one hand, we are told that the flow of money and goods across borders is making nation-states obsolete. On the other, global economic competition is almost always defined as conflict among national interests. Thus, for example, the US press warns us of a dire economic threat from China. Yet much of the "Chinese" menace is a business partnership between China's commissars, who supply the cheap labor, and America's (and Japan's and Europe's) capitalists, who supply the technology and capital. "World poverty" is likewise framed as an issue of the distribution of wealth between rich and poor countries, ignoring the existence of rich people in poor countries and poor people in rich countries.

The conventional wisdom makes globalization synonymous with "free trade" among autonomous nations. Yet as Renato Ruggiero, the first director-general of the World Trade Organization, noted in a rare moment of candor, "We are no longer writing the rules of interaction among separate national economies. We are writing the constitution of a single global economy." (Emphasis added.)

On the board of many transnational companies, Ruggiero has been both trade and foreign minister in the Italian government of right-wing businessman Silvio Berlusconi. He is now the chair of Citigroup's Swiss subsidiary. His fellow authors of the Davosian constitution have similar résumés, tracking careers that flow easily across borders and between public and private sectors. After just stepping down as German chancellor, Gerhard Schröder has become board chair of a Russian company building a gas pipeline that Schröder himself had negotiated while in office. And so it goes.

In the absence of global democracy, the forces that act as counterweights to the power of the investor class in national economies--labor, civil society and progressive political parties--are too weak and unorganized to create a global social contract. What might be called the "Party of Porto Alegre"--the NGO activists of the World Social Forum, who also meet annually (usually in Brazil, this year in Venezuela, Mali and Pakistan) in January--is hardly a match for Davos. It is therefore no surprise that the constitution of the world economy protects just one class of global citizen--the corporate investor.

Given the influence of American elites, the model for this constitution is the North American Free Trade Agreement, conceived under Ronald Reagan, nurtured by George H.W. Bush and delivered by Bill Clinton. Among other things, NAFTA's 1,000-plus pages give international investors extraordinary rights to override government protections of workers and the environment. It sets up secret panels, rife with conflicts of interest, to judge disputes from which there is no appeal. It makes virtually all nonmilitary government services subject to privatization and systematically undercuts the public sector's ability to regulate business. Jorge Castañeda, later Mexico's foreign secretary, observed that NAFTA was "an agreement for the rich and powerful in the United States, Mexico and Canada, an agreement effectively excluding ordinary people in all three societies."

In the fall of 1993 a corporate lobbyist, exasperated by my opposition to NAFTA, stopped me in the corridor of the Capitol. "Don't you understand?" she demanded. "We have to help [then-Mexican President Carlos] Salinas. He's been to Harvard. He's one of us."

Her reference to "us" seemed odd. Neither she nor I was a Harvard graduate. So it took me a while to get her point: "We" internationally mobile professionals had a shared interest in liberating similarly mobile global investors from regulations imposed by national governments on behalf of people who were, well, not like "us." Despite the considerable social distance between Salinas and both of us, she was appealing to class solidarity.

It's impossible to understand why Democratic Party leaders collaborated with Republicans to establish NAFTA unless reference is made to cross-border class interests. There was no compelling economic or political reason for Bill Clinton to make NAFTA a priority in his first year as President. In economic terms, nothing was broken that needed fixing. Politically, NAFTA and the WTO that followed traded away the interests of the Democratic Party's blue-collar electoral base while creating a bonanza for Republican constituencies on Wall Street and in red-state agribusiness.

But Clinton was more Davos than Democrat. Tutored by financier Robert Rubin, a prodigious fundraiser who became his Treasury Secretary, Clinton embraced a reactionary, pre-New Deal vision of a global future in which corporate investors were unregulated and the social contract was history. Indeed, in all three countries it was the leaders of the political parties that had historically claimed to represent ordinary people--the Democrats' Clinton, the Liberal Party's Jean Chrétien and the Institutional Revolutionary Party's Salinas--who delivered NAFTA to their global corporate clients, undercutting their own constituencies. "NAFTA happened," said the then-chairman of American Express, "because of the drive Bill Clinton gave it. He stood up against his two prime constituents, labor and environment, to drive it home over their dead bodies."

A year later, in November 1994, enough angry Democratic voters stayed away from the polls to give the Republicans control of the House. Since then, many working-class Americans, feeling abandoned by the Democrats, have responded to the Republican definition of class struggle as a fight over gun control, school prayer and abortion. The Democrats have still not recovered.

Consistent with a deal among the rich and powerful, NAFTA made the distribution of income, wealth and political power more unequal throughout the continent. In all three countries, wages in manufacturing fell behind productivity increases, shifting income from labor to capital. Ordinary Mexicans especially went through the economic wringer--to which the willingness of hundreds of thousands of them to risk their lives each year crossing the border continues to be tragic testimony.

On the other hand, opportunities blossomed for the rich and powerful in all three nations. American and Canadian investors got access to cheaper labor and privatized Mexican companies, while Mexican oligarchs got to broker the deals. One example was the way NAFTA was used to open up Mexico's banking system to foreign ownership, profiting elites on both sides of the border.

The governments of Carlos Salinas and his successor, Ernesto Zedillo--hailed in Washington as great free-market reformers--privatized government-owned banks, turning them over to business cronies, and, through NAFTA, revoked the legal ban on foreign ownership. When the banks started to fail, they were given huge government subsidies to make them attractive to transnational buyers. At the same time, the "reform" government was slashing subsidies to the poor for food and medicine.

Banamex, the country's second-largest bank, was bought by a Mexican syndicate, owned by Salinas pal Roberto Hernandez Rodriguez, for $3.2 billion and when, thanks to NAFTA, foreigners were allowed to own Mexican banks, it was resold to Citigroup for $12.5 billion. Robert Rubin negotiated the deal for Citigroup, where he had gone after leaving the Treasury Department. The Mexican government's welfare program for Citigroup and other foreign investors continues: In 2003 government subsidies to private banks (more than 85 percent of them now owned by foreigners) were almost three times those spent on roads, schools and other infrastructure.

NAFTA was only the beginning. The Clinton/Republican alliance then pushed through the WTO agreement and the subsequent deal with China that traded off more US industrial jobs in exchange for protections for US investors in that huge Asian market. Not only has this produced a massive trade deficit with China and further downward pressure on US wages, it has also sent some 250,000 jobs from Mexico to China. The ubiquitous Citigroup, with banking operations in 100 countries, is now busy building its Chinese banking empire--with Chinese partners.

That well-connected people who move in and out of government and business act in ways that benefit their class and take advantage of their contacts to further their own interests is neither illegal nor new. That's the way class privilege works. Thus, it is unlikely that Dick Cheney ever ordered anyone at the Pentagon to give a huge sole-source contract to Halliburton. He did not have to. Procurement officers already knew the relationship between the company and the Vice President. And Cheney's promotion of more funds for the military and for the war in Iraq in particular was bound to benefit the world to which he belonged--his circle of rich and powerful people who would always be there for him and his projects.

There are of course important differences between the ways the elites of the different parties promote the Davos agenda. The preferred instruments of Rubin Democrats are the economic levers of the US Treasury, the IMF, the World Bank and other international financial institutions. Rumsfeld/Cheney Republicans prefer the Defense and Energy departments. The Rubin mode is certainly less lethal and probably more effective. Still, Davos relies on the Pentagon to protect its class privileges with a worldwide web of military bases, training schools and the always-present threat to send in the Marines. It's worth remembering that virtually the only section of Saddam Hussein's law still untouched by the US occupation is its oppressive labor code.

But the twin pillars of the US superpower--the Pentagon and Wall Street--are slipping into their own crises and soon may not be able to provide the military and economic muscle for the Davos agenda.

The crisis on the military side involves blowback from the overreach in Iraq. Bush, Cheney and Rumsfeld--despite their thick transnational corporate connections--have created a disaster for Davos. The war has unleashed an army of enemies of Western modernization that is making global corporations nervous. Two years ago the wiser heads at Davos were appalled at Cheney's delusional report on the Bush Administration's progress in turning the Middle East into a shopping mall--however much they might have sympathized with the objective. Today the mess in Iraq has revealed to Davos both the incompetence of the American governing class and the unwillingness of the American electorate to make the sacrifices necessary to act as security police for the world's rich and powerful.

The looming economic crisis comes from the unsustainable US external debt. For more than a quarter-century, we Americans have been buying more from the rest of the world than we have been selling it, and borrowing from abroad to make up the difference. The resulting trade deficit has been a major engine of global growth under Davos's management. But common sense and simple arithmetic tell us that even the United States cannot go on much longer spending more than it is earning.

When the day of reckoning comes, high interest rates and a falling dollar will force us Americans to rebalance our trade by cutting the price of what we sell and raising the price of what we buy, lowering real incomes. The crisis in the nation's trade sector will be transmitted to the rest of the economy, made vulnerable by overindebted consumers, overleveraged pension funds and overpriced houses. Thanks to George W. Bush's reckless fiscal deficits, the government will have less ability to overcome an economic crisis through borrow-and-spend, as it did in the last economic downturn. With the appetite for America's IOUs diminishing, US politicians will have their hands full dealing with rising energy costs and the tottering finances of healthcare, education and pensions.

The basics of a harder-times scenario are not much in dispute. The debate is between those who foresee a hard landing and those who believe that the world's central bankers will somehow figure out a way to avoid a global financial meltdown. But hard landing or soft, even the staunchest supporters of globalization admit that lower living standards are already in the cards. N. Gregory Mankiw, who as Bush's chief economist famously praised the offshoring of American jobs, recently acknowledged that US reliance on foreign savings to support its consumption means a "less prosperous future."

Financier Warren Buffett reaches the obvious conclusion: We are headed for "significant political unrest." Democratic Senator Max Baucus, a staunch free-trader, recently told Chinese business executives that unless they cut their country's trade deficit with America "US politics will become unmanageable." New York Times columnist and Davos champion Thomas Friedman, who also sees the writing on the wall, suggests dividing political parties by economic class, with Republican Wall Street joining with Democratic Hollywood against disgruntled working-class "populists" in both red and blue states.

But working-class disgruntlement is likely to go beyond Freidman's stereotype of uneducated losers. The outsourcing and downsizing of opportunities is already adding to the insecurity of people much further up the skill ladder. There are signs that the anxiety is spreading to the business class as well; within organizations such as the National Association of Manufacturers, the owners of smaller and medium-sized businesses, who still depend on an American workforce, are beginning to dissent from the once united front in favor of globalization.

Resistance to Davos is also growing in our own hemispheric neighborhood. Latin American oligarchs who prospered by selling their countries' assets and people to transnational investors have been ousted in Brazil, Argentina, Venezuela, Uruguay and Bolivia. In Mexico, which is having a presidential election this July, a leftist critic of NAFTA leads in the polls. The Party of Davos may not be over, but the rest of the world seems less willing to foot the bill.

Here in America, the coming unrest could turn right as well as left. The Republican Party is hopelessly tied to the multinational priorities of the US business elite, but its managers are skilled at stoking nationalist resentment among the working-class victims.

In the two-party system the burden therefore rests on the Democrats' ability to produce leaders who are not co-opted by the Party of Davos. Given the current crop, our chances may not seem great. But leaders are often produced by the times. As globalization's squeeze on ordinary Americans continues, the political price will rise for those who continue to give priority to bringing Burger King to Baghdad over healthcare to Baltimore. It's worth remembering that Franklin Roosevelt, who was as elite and privileged as one could get, responded to the economic crisis of his time by becoming--as they muttered in the best clubs--"a traitor to his class."