Category Archives: debt limit impasse

Take Note, Plutocrats: Populism is Not Just a Spectre – It’s Rule by the People, for the People.

A spectre is haunting the world’s plutocracy – the spectre of populism. According to Politico, “Economists, advisers to the wealthy and the wealthy themselves describe a deep-seated anxiety that the national – and even global – mood is turning against the super-rich in ways that ultimately could prove dangerous and hard to control.”

Their fears are well justified. The billionaire elite in the U.S. is virulently opposed to Obamacare and the expansion of Medicaid, it is incensed by calls to increase the minimum wage, and through its proxies in Congress it has stopped an extension of long-term unemployment benefits. Anything that retards its wholesale looting of society’s wealth is anathema to it, including the Obama administration’s attempts to alleviate the worst effects of the economic downturn.

The plutocrats can maintain their hold on power only through their ideological grip on a large section of the American public – and challenges to that grip make them increasingly nervous.

Venture capitalist Tom Perkins, who made his money from Hewlett-Packard defense contracts, wrote in the Wall Street Journal: “Writing from the epicenter of progressive thought, San Francisco, I would call attention to the parallels of fascist Nazi Germany to its war on its ‘one percent,’ namely its Jews, to the progressive war on the American one percent, namely the ‘rich’.” He was echoed by real estate mogul Sam Zell: “The one percent are getting pummeled because it’s politically convenient to do so,” he said, adding that the one percent simply “work harder” than everyone else.

Juan Cole points out how their outlook and that of congressional Republicans is totally out of step with the U.S. public: “What is odd, and damning of the current American political system, is that the Republican Party’s major platform positions are roundly rejected by the American people. That is, they are ideologically a minority party. And yet they manage to win elections. … We are a center-left country and the majority of Americans takes the same stance as I on most controversial issues. It is the House of Representatives that is extreme, far more right wing than the country it says it represents.”

They are so far to the right that a Coca-Cola ad aired during the Superbowl featuring “America the Beautiful” sung in different languages evoked howls of outrage from tea-party politicians who posted racist comments on Twitter.

Within the Republican party itself there are fractures over immigration that reveal tensions between this kind of xenophobic rhetoric and corporate interests; the party’s difficulties stem from its need to use racist messages to preserve a declining white electoral base that itself depends on state support, while advocating cuts in state spending that would benefit only the super-rich.

Popular resistance to cuts in education, healthcare, and benefits is what is worrying the plutocrats. Whether Republican or Democrat, the public is determined not to lose social security benefits or other entitlements, and the low-waged have embarked on a popular campaign to increase the minimum wage to a living wage.

This mood of resistance was reflected in Obama’s fifth State of the Union address. What was remarkable about it was the contrast between the grand themes of hope and change that characterized his election campaigns, and the limited nature of his proposals for executive action rather than legislation to address social issues. He maintained a difficult balancing act between corporate and public sentiment, acknowledging unsustainable inequality in America but advocating a neoliberal prescription for economic growth through the fast-tracking of the Trans-Pacific Partnership agreement that can only lead to the loss of more jobs.

Obama’s executive order raising the minimum wage to $10.10 an hour for federal contractors clearly aimed to contain a vigorous movement within an electoral framework. However, his speech also serves to encourage a growing trend of lightning strikes and walkouts, inspired by the ideal of a $15 minimum that is closer to a living wage.Josh Eidelson has been reporting in Salon about the series of one-day strikes organized by the union-backed “Good Jobs Nation” campaign to force Obama’s hand on the issue. “As recently as this month, the co-chairs of the Congressional Progressive Caucus, who’ve rallied repeatedly with the strikers, told Salon the White House had been unresponsive to their pleas. ‘If we had never done this,’ said [Smithsonian McDonald’s worker] Alexis Vasquez, ‘we would have continued making $8.25 for the rest of our lives’. But the move announced today falls short of what Demos and Change to Win have urged. … Given that ‘the issues are still there,’ said Joseph Geevarghese [deputy director of the Change to Win union federation], including contractors’ alleged failure to follow the wage laws already on the books, ‘I think we’re going to see continued worker unrest going forward’.”

Obama’s plan for a “grand bargain” to rationalize state expenditure in which he could trade cuts in social security for token increased taxes on the rich was stymied by the grip of the tea-party Republicans on Congress. As the Washington Post reported, his address attempted to restore confidence in his presidency, as he faced “a tricky task: winning over a nation that has grown less trustful of his leadership after a year in which the federal government was partially shuttered for 16 days and the administration botched the rollout of Obama’s health-care law.”

Juan Cole assessed his presidency as politically passive, accepting the international role bequeathed him by the Bush administration and the Pentagon. “In the end, Obama seems to see himself as primarily a domestic president. That position is remarkable because the Tea Party Congress won’t actually let him do much domestically. … He says the right things about conventional uses of the military, but in his actions he is a Covert War hawk.” He said little about NSA spying apart from a throwaway statement about reform – and even that was forced on him by Edward Snowden’s revelations.

While Snowden is undoubtedly the person who changed the political dialog in 2013, this year’s heroes will be those like 22-year-old fast food worker Naquasia LeGrand who are fighting to change the lives of those at the cutting edge of poverty wages. She gave a spirited interview to comedian Stephen Colbert where she voiced the determination of the low-waged to get a better deal from the billionaires: “It’s not just me who is going through this. It’s all of us going through this. That’s what makes a union. Americans coming together to make a difference and have a voice together. … there is no reason why I should have a second job when these multi-billion dollar companies have the money to pay me in the work that I do.”

This is the kind of talk that has the plutocracy losing sleep at night. It is fueling more and more campaigns at the state level, such as in Oakland, CA, where a union-community coalition aims to put a measure on the ballot in November 2014 that would increase Oakland’s minimum wage from $8 an hour to $12.25, with future increases tied to inflation, and at least five annual sick days for all workers.

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Filed under Affordable Care Act, austerity measures, debt limit impasse, Edward Snowden, fast-food workers, National Security Agency, Neoliberalism, Obama, Obamacare, populism, Republicans, Tea Party movement

Tea Party to Obama and America: “This land is my land/ and I will fight you/ unless like me / you’re rich and white”

As the US government shutdown continues and the debt limit deadline approaches, business leaders and investors are seriously concerned that no agreement has been reached. The Republican party’s traditional backers on Wall Street and major corporations fear that a government debt default would be a major disaster, but do not have the same influence on its leadership that they once had because of the significant weight of Tea Party legislators who oppose any kind of political compromise.

The Republican congressional leadership knows that the party’s electoral base is contracting and in the longer term likely to vanish. So in the short term the Republicans need to assert the legitimacy they consider they gained in the 2010 elections in order to achieve the party’s goal of cutting state welfare spending. The leadership may not agree on the tea party tactic of shutting down the government, but it cannot end the shutdown without losing leverage on cuts.

Washington Post writer Greg Sargent comments: “The battle that spawned a government shutdown is also very much about preserving the GOP majority’s relevance in future policy debates. … Republicans are concerned that the refusal of President Obama and Senate Democrats to negotiate those issues with Republicans would establish a precedent making it impossible to haggle over future debt limit increases or to use them as leverage in other policy negotiations. … Republicans said capitulating to Obama would cede to Democrats the only institutional authority Republicans possess.”

Does the standoff – opposed by a clear majority of the American public – mean that the tea party is politically finished? E.J. Dionne writes: “The movement is suffering from extreme miscalculation … the tea party is primarily about postures aimed at undercutting sensible governance and premised on the delusion that Obama’s election victories were meaningless.” Dionne’s Washington-centric argument leads him to misinterpret the purpose of the tea party’s political theater. It’s not aimed at achieving a coherent government policy, but is directed at reinforcing resentment and prejudice among right-wing Republican voters, one predicated on the axes of class and ethnicity.

Backed by billionaire-supported political campaign groups, such as “Heritage Action,” and activists who are paid to put pressure on elected Republicans and mobilize the news media so as to dominate the political discourse, the Tea Party hooligans seek to subvert the ideal of equal opportunity and the shared prosperity of the nation in order to assert possessive individualism. It’s not, “This land is my land/ This land is your land … This land was made/ for you and me” but rather, “This land is my land/ and I will fight you/ unless like me / you’re rich and white.” Republican voters may indicate support for this notion, but are not active at the grassroots, so success or failure is not going to have a great effect on the Tea Party. The phenomenon won’t end until billionaires are no longer able to direct their wealth into manipulating elections.

A Democracy Corps report based on focus groups in red states found that “More than 4 in 10 Republicans identified with the tea party and were more apt than other Republicans to insist that their leaders hold firm in the standoff … right-wingers … believe they are fighting for political survival in an era where white-run America is vanishing and they’ve lost the culture war.”  While the Tea Party is increasingly unpopular with the general public, it has retained its support among Republican voters.

In 26 states where Republicans dominate, the legislatures have voted not to accept the extension of Medicaid, part of the Obamacare law. This posture is directed at keeping control of the dwindling Republican base, above all in the South, by preventing the extension of health care insurance from benefiting poor whites in these states which might make them more favorable to government programs and switch electoral support to Democrats. Both poor whites and poor blacks lose out in these states, leaving millions of them still uncovered. Texas, for example, has an estimated 22 percent of the population without health insurance. They will stay uninsured because its governor, Rick Perry, refused to set up a state insurance exchange and turned down billions in federal funds to expand Medicaid coverage.

Most Republican voters have little in common with the plutocrats who direct Republican talking points, nor with Southern elites that premise the region’s economy on a low-wage “right to work” labor force. However, the coded racism of the GOP’s southern strategy serves to reinforce the prejudices among poor whites that welfare benefits will go primarily to African-Americans.

UMass professor Nancy Folbre quotes a number of academic studies that show how “white political leaders from states with large numbers of African-Americans – especially but not exclusively in the South – have cast new federal protections in apocalyptic terms and mounted a powerful opposition. … Poor whites are promised protection against labor market competition or higher taxes in return for acquiescence with policies that restrict the social safety net.”

Tea Party politicians, while articulating an anti-government ideology developed over years by right-wing think tanks, at the same time have a particular appeal to insular rural or suburban communities who fear that national trends may lose them local privilege, as well as local business elites that need to bolster their competitive position by using state representation to negate federal regulation or taxes.

For example, a comment on a recent New York Times article on Steve King, the leader of the Congressional resistance to Obamacare, points out that King’s Iowa constituency “is largely populated by wealthy Dutch Calvinist farmers, who have recently dived headfirst into the hog and cattle confinement business.” MSN reports that in July 2012, King “sponsored an amendment to the House Farm Bill that would legalize previously banned practices such as tail-docking, putting arsenic in chicken feed, and keeping impregnated pigs in small crates. ‘My language wipes out everything they [animal rights activists] have done with pork and veal,’ King said of his amendment.”

In this vein, author Michael Lind argues that Congressional tea partiers are following an entirely rational strategy on behalf of their constituencies. The Tea Party’s social base, he says, “consists of what, in other countries, are called the ‘local notables’ – provincial elites whose power and privileges are threatened from above by a stronger central government they do not control and from below by the local poor and the local working class. … They are second-tier people on a national level but first-tier people in their states and counties and cities. … They would rather disenfranchise blacks and Latinos than compete for their votes. And they would rather dismantle the federal government than surrender their local power and privilege.” However, this brand of local sectionalism would not have had a chance at the national level if it had not connected with the narrative of the plutocracy to undermine the concept of the common good.

Richard Seymour gives Lind’s analysis a Marxist gloss, while stressing the importance of the ideological dimension of Ted Cruz’s speechifying. Obamacare, he writes, “is connotatively linked in a chain-of-equivalents to a whole series of issues from the bank bailouts to stimulus spending to unions etc.  These are all linked, somehow, to the threatened revival of a social coalition behind a moderate tax-and-spend liberalism which the Tea Partiers call, with perfect Hayekian inflection, ‘socialism’.” Seymour describes the social coalition behind moderate liberalism as “essentially a pact between the working class and the upper levels of the bourgeoisie.” But this is a mischaracterization of the social movement behind Obama’s reelection, which is what truly disturbed the provincial white elites, and tends to downplay the struggle at the political level by imposing a class schema on a complex social reality.

Obama’s election victories stemmed from a visceral rejection of the Bush years and bank bailouts from across society but in particular by the young and by growing numbers of minority voters who in a few years will make up a majority of the population. The mood of the country was expressed above all by the Occupy movement, whose rhetoric Obama appropriated in his electoral campaign: a rejection of the political and economic domination of the country by Wall Street and the billionaire one percent.

It remains to be seen if the stalemate in Washington is resolved by negotiations over cuts in social security and Medicare. This is a strategy pushed by the business class and bankers, as well as the billionaires who back the Tea Party. Republicans cannot capitulate to Obama without giving up their leverage, but Obama can’t contain the social movement that elected him if he is seen to abandon constitutional government and agree to swingeing fiscal austerity.

He senses that this movement’s demand for more government intervention to create jobs, a higher minimum wage, and an end to fiscal cuts has grown stronger and more determined. Americans of all ethnicities have realized that if we’re going to sing, “This land is my land / This land is your land” next Fourth of July, we’ve got to protect the 99 percent. Time for our legislators to do the same.

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Filed under debt limit impasse, Government shutdown, marxism, Obama, occupy wall street, political analysis, Republicans

Obamacare Crisis Week 2: Plutocrat Gangsters Hold America Hostage through Tea Party Posse

The US is entering its second week of a government shutdown. On the surface, life seems to be continuing as usual – at least, as far as the media is concerned.

Conservative Republicans, who are driving policy in Congress, are using the tactic of blocking government funding to delay the implementation of Obamacare. But their aim is to overturn established legislation that was passed in 2010. If the administration were to cave on this, it would have accepted the precedent that one chamber of Congress could enforce its will on government by holding funding hostage.

While Washington Democrats and Republicans maneuver for tactical advantage, the poor and near-poor are being punished. Government supplementary food programs, for example, have taken an immediate hit. Imara Jones pointed out on Democracy Now that the shutdown “comes on top of the dramatic cuts of sequestration. … mothers with young children… had gone to WIC sites and WIC programs in New York that were out of food. And that’s on day two…”

The shutdown is essentially a trial of strength between extremist billionaires and the executive branch. It’s not intended to achieve anything in itself, any more than Ted Cruz’s 21-hour monologue in Congress did. It is a ploy to put pressure on the Republican leadership and in turn on Obama through the coming debt ceiling negotiations to make bigger cuts in social spending and eventually eviscerate Social Security and Medicare.

Under Obama’s administration, the plutocracy has grown economically richer and politically more powerful, using unlimited access to new technology and media (thanks to the Supreme Court) to sway a disgruntled core of Tea Party supporters who have successfully elected extremist Republican candidates in gerrymandered constituencies. They in turn have been able to use weaknesses in the American political system to paralyze the government.

The New York Times reported on the plethora of well-funded conservative shell groups that have been campaigning against the health law, laundering political slush funds from the billionaire Koch brothers to create a sustained ideological onslaught on the idea of government-supported health care. The billionaires’ strategy has been to put pressure on Republican legislators through groups like “Heritage Action,” which has trained 6,000 paid “sentinels” to confront legislators around the country.

Their campaign builds on a Republican ideological narrative that portrays government deficits as unsustainable. Traveling to Congressional Tea Party leader Steve King’s constituency in rural Iowa, NYT reporter James Stewart “was surprised to hear in nearly all my conversations that the issue for people in this part of Iowa is less Obamacare than it is government spending in general. ‘We have to sacrifice now so our children will not be drowning in our debt,’ [King supporter and glass factory owner] Mr. Geels said.” Many online comments on the article pointed out that the region survived on massive agricultural subsidies, and in the event of another agricultural crisis like the 1980s would be appealing desperately for government help.

The shutdown has made major corporations and Wall Street nervous, but they are no longer able to command influence in the Republican party. The Associated Press commented that “the partial closing of the government and the looming confrontation over the nation’s borrowing limit highlight the remarkable drop in the business community’s influence among House Republicans, who increasingly respond more to tea party conservatives than to the Chamber of Commerce.”

Ironically, big business torpedoed Republican moderates in 2010, helping hard-core conservatives gain election to the House. Corporations might want a rollback of environmental regulations and even further cuts in their taxes, and Wall Street may be in favor of cutting Social Security, but neither want to crash the economy to achieve these aims. However, moderate Republicans face billionaire-funded attacks and attempts to unseat them in primaries if they voice their opinions.

Although some have argued that tea party ideology signifies a descent into insanity, it is in line with overall Republican strategy. The New York Times comments that despite its flaws, Obamacare “could fundamentally change the relationship between working Americans and their government. This could pose an existential threat to the small-government credo that has defined the G.O.P. for four decades. … To conservative Republicans, losing a large slice of the middle class to the ranks of the Democratic Party could justify extreme measures.”

Harold Meyerson points out that the party holds the House with a minority popular vote, the result of gerrymandered districting after the 2010 census. Either Republicans can exert influence by embracing minority rights, he says, or they can maximize their power “by trying to disrupt the nation to the point that the majority will be compelled to support Republican positions.” The redistricting will ensure there are no electoral repercussions for their intransigence.

Republican-controlled states like Mississippi have voted to reject government-subsidized Medicaid expansion, one of the health act’s provisions, which would have had the effect of expanding health coverage in the state’s predominantly white rural counties, which voted consistently to put Republican lawmakers into office.

Poor whites who presently form the conservative Republican demographic would then get the most benefits from Obamacare while, it turns out, poor blacks who live in Republican-controlled states would get little. “The irony is that these states that are rejecting Medicaid expansion — many of them Southern — are the very places where the concentration of poverty and lack of health insurance are the most acute,” said Dr. H. Jack Geiger, a founder of the community health center model. “It is their populations that have the highest burden of illness and costs to the entire health care system.”

While conservatives claim public support for their tactics, opinion polls tell a different story. Josh Marshall sums them up: “The public opposes [the shutdown] by overwhelming margins (70%+). The public also blames the shutdown on House Republicans by a substantial though not overwhelming margins (the number who blame Obama, in the mid-30s, roughly matches the base of the GOP).”

A Kaiser poll found that most Americans, even fervent opponents of the health law, were substantially in favor when asked about its individual provisions. “A majority of Republicans feel favorable towards seven of the 11 provisions asked about in the March poll, with seven in ten or more favoring tax credits to small businesses, closing the Medicare ‘doughnut hole’, and the exchanges,” researchers found.

The propaganda campaign against the law has created a great deal of public confusion, but what has been hidden in the furor about the government shutdown is that the launch of Obamacare on Tuesday generated a huge volume of traffic to its websites – 7 million people in the first two days, an unexpected volume that caused delays and access problems. There is clearly a huge pent-up demand for information about affordable health care.

Americans are genuinely worried about health care and the future. As Juan Cole points out: “This is an America where unemployment is stubbornly high for the Millennials, where the top 1% are taking home 20% of the national income (twice the proportion of just a few decades ago), and where people are struggling.” Young adults stay living with their parents, because even if they can get a job, it’s low-waged. Many are still burdened by college debt. In a Washington Post poll, almost two-thirds of people express concerns about covering their family’s basic living expenses, compared with less than half four decades ago.

Ralph Nader asks why big business, the Republican establishment, and the executive branch have suddenly become powerless. “Who is in charge here?” he writes. “Our Constitution opens with the words ‘We the People,’ not ‘We the Congress’ or ‘We the Corporations’.” It is time for the people to take sovereignty back into their own hands and disrupt the super-rich hostage-takers.

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Filed under debt limit impasse, Government shutdown, health care, Medicare, Obama, political analysis

Forget the Faustian Cliff Deal: Fight for a Living Wage

The last-minute deal to end the “fiscal cliff” settles very little. Congressional Republicans agreed to a small increase in taxes on individuals making more than $400k, while Democrats were able to extend the protections of the social safety net, like unemployment benefits, for two more months. Come February, the American electorate will have to go through another round of this perverse game of chicken with the “debt ceiling” debate.

According to Talking Points Memo, “a key provision of the fiscal cliff deal only buys down the sequester for two months, meaning deep cuts to domestic and defense spending will take effect at the end of February, right when the debt limit will have to be increased.”

It’s easy to see that the deal doesn’t defuse the Republican strategy of preventing the normal functioning of government in order to exert leverage on state policy. Another battle is looming in which Republicans will have a stronger hand politically. Paul Krugman’s take is that Obama’s “evident desire to have a deal before hitting the essentially innocuous fiscal cliff bodes very badly for the confrontation looming in a few weeks over the debt ceiling.”

Had we gone over the cliff, taxes would have been restored to Clinton-era levels. But why should there be any popular objection to restoring taxes to the level everybody was paying in the 1990s? The reason is that legislators have masked the real decline in wages over the last 10 years by cutting taxes, and rising prices have squeezed the middle class to the point that a small tax increase would have a major effect on their ability to make ends meet.

Michael Hudson points out the deception behind the political rhetoric over taxes: “The emerging financial oligarchy seeks to shift taxes off banks and their major customers (real estate, natural resources and monopolies) onto labor. Given the need to win voter acquiescence, this aim is best achieved by rolling back everyone’s taxes. The easiest way to do this is to shrink government spending, headed by Social Security, Medicare and Medicaid. Yet these are the programs that enjoy the strongest voter support. This fact has inspired what may be called the Big Lie of our epoch: the pretense that governments can only create money to pay the financial sector, and that the beneficiaries of social programs should be entirely responsible for paying for Social Security, Medicare and Medicaid, not the wealthy. … The raison d’être for taxing the 99% for Social Security and Medicare is simply to avoid taxing wealth, by falling on low wage income at a much higher rate than that of the wealthy.”

Wages have fallen as capital has creamed off a greater proportion of the national income at labor’s expense.  The key to employers’ ability to hold down wages is the decline of unions. They were able to organize effectively when the mass of Americans worked in factory jobs while the economy was expanding after World War 2. But unions have faced a war of attrition over the last 30 years as structural changes in the economy were accompanied by corporate-friendly legislative restrictions on their bargaining strength. These were political decisions that were aimed at destroying the gains of the New Deal.

Harold Meyerson notes in the Washington Post “how central the collapse of collective bargaining is to American workers’ inability to win themselves a raise. Yes, globalizing and mechanizing jobs has cut into the livelihoods of millions of U.S. workers, but that is far from the whole story. Roughly 100 million of the nation’s 143 million employed workers have jobs that can’t be shipped abroad, that aren’t in competition with steel workers in Sao Paolo or iPod assemblers in Shenzhen. Sales clerks, waiters, librarians and carpenters all utilize technology in their jobs, but not to the point that they’ve become dispensable. Yet while they can’t be dispensed with, neither can they bargain for a raise.”

Outsourcing undermined the unions’ base and this, while facilitated by new technology, resulted from decisions of the US government to open up the domestic economy to world trade. The consequence was a withdrawal of capital from direct manufacturing in the US in favor of the higher-profit areas of marketing and distribution. As manufacturing declined, corporations became increasingly financialized, facilitating the growth of monopolies.

Steve Fraser spells it out in TomDispatch: “Rates of U.S. investment in new plants, technology, and research and development began declining during the 1970s, a fall-off that only accelerated in the gilded 1980s.  Manufacturing, which accounted for nearly 30% of the economy after the Second World War, had dropped to just over 10% by 2011. … The ascendancy of high finance didn’t just replace an industrial heartland in the process of being gutted; it initiated that gutting and then lived off it, particularly during its formative decades.  The FIRE sector, that is, not only supplanted industry, but grew at its expense – and at the expense of the high wages it used to pay and the capital that used to flow into it.”

As well as being weakened by structural changes in the economy, unions have faced an ideological assault. As more and more workers found themselves on temporary assignment, without contracts or benefits, their resentment was leveraged electorally against organized labor by billionaire-funded campaigns aimed at dividing unionized employees from other workers.

Walmart is a model for this turn to absolute exploitation of workers. The company, according to In These Times writer David Moberg, “heavily influences standards for vast swaths of the American economy, from retail to logistics to manufacturing. Over the past few decades, Walmart’s competitive power—a combination of size, technology and cut-throat personnel policies—has played a role in dramatically reducing American retail workers’ average income and unionization level (from 8.6 percent in 1983 to 4.9 percent in 2011).” Walmart now pays less than what a worker needs to reproduce his or her labor-power, offloading the costs of healthcare, housing etc. onto the rest of society. It is a strategy that results in destroying a generation of workers – a form of destruction of capital – devaluing labor.

Low wages and opposition to unions are more than just a means of gaining market share. They are also a way of establishing power over the workforce. Labor historian Nelson Lichtenstein explains: “Wal-Mart’s hostility to a better-paid and healthier workforce is as much an issue of power as it is a question of prices and profits. High wages reduce turnover and awaken employee expectations, transforming the internal culture of the workplace. Decent wages lead to real career and the expectation of fair treatment over a lifetime of employment. That in turn might well lead to demands for a steady work shift, an equitable chance at promotion, retirement pay, and even the opportunity to make one’s voice heard in a collective fashion.” [Nelson Lichtenstein, The Retail Revolution, New York 2009:250]

In 2012, union struggles for a living wage challenged not only the business strategy of companies like Walmart, but also the political strategy of the plutocracy to weaken and destroy unions and dump responsibility for social welfare onto the individual. Moberg notes: “OUR Walmart joins a host of smaller campaigns by workers in other precarious and penurious industries, like logistics, fast food and domestic work. With enough density of membership, service-sector unions can raise standards in local, and ultimately national, markets. For example, in San Francisco and New York, where 90 percent of hotel housekeepers are unionized, average hotel housekeeper wages are $19 to $26 an hour, compared to a national average of $10.10.”

Across the country, low-waged workers in various industries are empowering themselves by fighting back. The Occupy movement’s achievement to raise consciousness of inequality, new approaches to union organizing, and outpourings of solidarity such as the support for victims of Hurricane Sandy, point the way forward for 2013.

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Filed under austerity measures, debt limit impasse, Medicare, Obama, occupy wall street, OUR Walmart, political analysis, Walmart, We are the 99 percent

Unlike Republicans Heading for their Imaginary Fiscal Cliff, American Workers Are Not Playing Chicken

Politicians of all stripes are talking about nothing but the so-called “fiscal cliff.” This debate, though, takes place within a Washington ideological bubble when what the rest of the country is worried about is the remorseless increase in food and gas prices while wages are frozen, squeezing the low pay of workers in service jobs. There is a major clash developing between the Republican party’s push for more cuts in social programs and those who depend on them to make ends meet.

The recent strikes at Walmart and in the fast food industry signify that people’s backs are to the wall and their need for a living wage is becoming urgent. The growing upsurge in worker resistance has three important features. The first is the spontaneous and worker-driven nature of the actions, which are targeted to their specific industry. The second is that the catalyst in many cases has been the support of union and community activists working to organize the low-paid. And the third is that each strike has had a ripple effect, encouraging others who were hesitating before taking action on their own behalf.

The fast food workers in New York, for instance, were given confidence by the Walmart Black Friday strikes. Pamela Waldron, who works for Kentucky Fried Chicken at Penn Station, told Democracy Now: “At my job, they are threatening us that if we do join the union, they could fire us. … What inspired me to do this is the Wal-Mart strike. Wal-Mart has been around too long for them not to have a union.” Raymond Lopez said: “I’ve been on strike since 5:30 a.m. I strongly believe that when the people on the bottom move, the people on the top fall. The reason—the reason you’re on the top, because we’re holding you up.”

In Chicago, according to In These Times, “a campaign to organize both retail and fast food workers in one dense, upscale commercial district started earlier this year, thanks to a similar coalition involving SEIU and two closely-aligned organizations, Stand Up, Chicago! and Action Now, a community organization focused primarily on issues of lower-income working people. On Nov. 15, about 150 workers from fast food and retail stores located in the North Michigan Avenue area formally convened the Workers Organizing Committee of Chicago to organize and create a new independent union.”

Sarah Jaffe notes in The Atlantic: “What we’ve seen with Walmart and now with the fast food workers is [that] an independent organization, supported by traditional labor unions (in this case, the Service Employees International Union along with New York Communities for Change, United NY, and the Black Institute), can be more creative in its organizing tactics.”

Democracy Now co-host Juan Gonzalez was struck by the age of the workers involved in the strike. “But what’s happened as a result of the Great Recession and the continual downward push on wages is that you’re finding now a lot of middle-aged and elderly people who are in these jobs. … the reality is that as these older workers get pushed into these low-wage jobs, all of them have had, to some degree, union experience in the past. They understand the importance of unions, and they’re now becoming the catalyst in the fast-food industry to begin a—what could be, potentially, a huge unionization campaign.”

The continuity of these strikes with the Occupy movement can be seen in the fact that many strikers point to the huge disparity in the profits made by the companies they work for and their subsistence-level wages. Even without a direct organizational connection, the imaginary of the 99 versus the one percent has had a visceral resonance.

Some commentators, like In These Times writer Michelle Chen, have compared the current campaigns of the low-waged to early twentieth century syndicalist movements, like the Industrial Workers of the World. “The IWW’s signature organizing model, syndicalism (which prioritizes direct action in the workplace), meshes with the growing trend in the labor movement toward less bureaucratic labor groups, such as worker centers and immigrant advocacy campaigns. Flexible mobilization that doesn’t require formal votes or union certification is well-suited to precarious laborers seeking to outmaneuver the multinationals. … And while the heyday of syndicalism has faded, the food economy’s sheer mass and dynamism may prove fertile ground for its resurgence.”

However, conditions for immigrant workers today are very different from those of the early 1900s. Struggles since that time have established a structure of labor law and have solidified popular expectations of the social contract and state responsibility to ameliorate poverty. So direct action at the workplace is part of a broader front including legal and political battles, even though new worker organizations may not be closely tied politically to the Democrats like traditional unions. For example, as well as fighting Walmart’s subcontractors over wage theft and labor abuses, lawyers acting for the workers involved have recently succeeded in adding Walmart as a defendant, undercutting its denials of responsibility and increasing pressure on the company to change its labor practices.

The election manifested the country’s support for an increase in taxes on the rich and super-rich. But because Republicans (and the Democrats who give into the rhetoric) want to cut social programs while maintaining corporate welfare, the national debate has been expanded to the issue of a living wage for the working poor. A study by Demos finds that if retailers were to pay a minimum of $25,000 per year to their employees, it would raise more than 700,000 people out of poverty.

In addition, the report goes on, “The economy would grow and 100,000 or more new jobs would be created. Families living in or near poverty spend close to 100 percent of their income just to meet their basic needs, so when they receive an extra dollar in pay, they spend it on goods or services that were out of reach before. … Increased purchasing power of low-wage workers would generate $4 to $5 billion in additional annual sales for the sector. … If retailers pass half of the costs of a wage raise onto their customers, the average household would pay just 15 cents more per shopping trip—or $17.73 per year.”

Paul Krugman confirms this analysis in many of his columns, repeatedly expressing frustration at the ideological commitment of financiers and corporate flacks in the GOP to austerity, and pointing out that what is needed to jumpstart the economy are more jobs and higher wages.  Robert Reich comments: “Washington’s obsession with deficit reduction makes it all the more likely these workers will face continuing high unemployment – even higher if the nation succumbs to deficit hysteria. That’s because cutting government spending reduces overall demand, which hits low-wage workers hardest. They and their families are the biggest casualties of austerity economics.”

The “fiscal cliff” rhetoric takes place in this context. It’s really a Republican scam on behalf of the one percent to undo the election result and extort yet more sacrifices from the rest of society to jack up their incomes. Their dream of massive cuts in social entitlements will create a firestorm among the low-paid if they attempt to carry it out. A social collision is inevitable, and this will dominate the coming twists and turns in the political arena.


Filed under 2012 Election, austerity measures, debt limit impasse, occupy wall street, OUR Walmart, political analysis, poverty, strikes, walmart strikes

Their Line on the Pavement: The Republicans Preview their Wild West Vision of America in Tampa, but the Little People Still Complain

State troopers and protesters face off in Tampa, Florida, on Monday. Photo: yfrog

When the Republican party convenes in Florida on Tuesday, it will be walled off from Tampa citizens and the concerns of the general public by phalanxes of state troopers. But inside the convention center itself, the Republicans’ agenda is so extreme it is stratospherically removed from the needs of ordinary Americans. Tea party supporters, backed by funds from maverick billionaires, have commandeered the delegates and are making it difficult for the Republican establishment to control their message – a throwback, extremist platform designed to slash and burn the middle class standard of living and devastate the poor by ending Medicare while giving a free pass on taxes to the new plutocratic super-rich.

Dana Milbank reports that the conference will consider “a study of whether to return to the gold standard, a call for auditing the Federal Reserve, positions denying statehood to the District [of Columbia] but seeking to introduce more guns onto its streets, a provision denying women a role in combat, and others calling for a constitutional amendment that makes tax increases a thing of the past and for a spiffy new border fence — with two layers!”

The furor over the comments by Todd Akin, the Republican nominee for Senate in Missouri – who claimed that the female body had ways to shut down pregnancy in cases of “legitimate” rape – conceals the fact that his views are identical to the party’s program. Frank Rich points out: “The truth is that Akin is typical of today’s GOP, not some outlier; only a handful of the House’s 241 Republican members differ at all from his hard-line stand on abortion. … Akin’s sin in the eyes of GOP grandees has nothing to do with his standard-issue hard-right views — it’s that he gave away the game by so candidly and vividly exposing how extreme those views are in an election year.” Akin was able to garner enough support from the Republican base to successfully defy the party leadership and stay in the Senate race.

While the Republican coalition is united in opposition to Obama, insiders believe the party will split apart after the election when it faces real issues. Juan Cole published a piece by Paul Guzzo detailing the fears of the local party in Tampa, where the convention is taking place. One Republican insider explained that Tea Party supporters realized they had to support other issues than just that of government spending, but “rather than supporting ‘real issues,’ they latched on to crazed theories such as the Agenda 21 conspiracy (the Teabagger belief that the U.N. is trying to deprive people of property rights by forcing them to live in cities). The Pinellas County, Florida Tea Party Movement’s succeeded in getting fluoride removed from its drinking water on the belief that fluoride is ‘toxic’ and that scientists cannot be trusted because they work for ‘Big Brother’.”

Romney’s choice of Paul Ryan as his running mate reflects the fact that even after winning the party primaries, he still hasn’t been able to gain the support of his party’s base, many of whom voted for anyone but him. Romney needs to divert attention away from his own dubious wealth to issues of personality and small-town values. Political scientist Tom Ferguson explains that Ryan embodies the appearance of radical change to people who are desperate. “You now have an enormous unemployment crisis. People want, effectively, a kind of round square. They are really scared about the budget. They think that is the way, cutting that might get them back to a reasonably full employment. They don’t know what to think. The Obama administration does not help them on that by walking around and talking about how all it wants to do is cut the budget, and over the long run.”

Yet it is not a foregone conclusion that Romney will lose his presidential bid. At present the U.S. is divided down the middle politically. Economically, voters’ wealth has plummeted since 2009. The New York Times reports: “The typical household income for people age 55 to 64 years old is almost 10 percent less in today’s dollars than it was when the recovery officially began three years ago, according to a new report … Across the country, in almost every demographic, Americans earn less today than they did in June 2009, when the recovery technically started.”

Americans’ ideological presuppositions color who they blame for this – an older, whiter, and more conservative layer wants to return to the kind of prosperity they knew in the 60s. They have been convinced that this can be achieved by reducing the government deficit, cutting entitlements, expelling immigrants, and asserting patriarchal values by limiting or altogether eliminating the choices women have about their reproductive health and halting gay marriage.

Writing in New York magazine, Jonathan Chait comments: “Piles of recent studies have found that voters often conflate ‘social’ and ‘economic’ issues. What social scientists delicately call ‘ethnocentrism’ and ‘racial resentment’ and ‘ingroup solidarity’ are defining attributes of conservative voting behavior, and help organize a familiar if not necessarily rational coalition of ideological interests. … Theda Skocpol, a Harvard sociologist, conducted a detailed study of tea-party activists and discovered that they saw themselves beset by parasitic Democrats. ‘Along with illegal immigrants,’ she wrote, ‘low-income Americans and young people loom large as illegitimate consumers of public benefits and services’.”

Demographic changes mean that Republicans cannot guarantee an election win by appealing to the resentment of angry and alienated white men. The electorate is becoming younger, more educated, and less white. Where Republicans control the electoral process, they have set up legal hurdles targeted to suppress likely Democratic voter turnout. However, the reason the race is still close is because Obama has disillusioned the social movement that elected him by accepting Republican budget-cutting rhetoric and refusing to prosecute bankers. “Too big to fail” banks are continuing to act lawlessly in eviction actions and to destabilize the economy. We may be going from Big Brother to Big Daddy, but rest assured: Big Daddy is much worse.

Outside the RNC, class solidarity has replaced the narrative of racial division that has served the Republican party for so long. If there is hope for the renewal of American society and its beleaguered and corrupted political system (thanks to Citizens United), it is in the spread of this spirit and new understanding of solidarity throughout the country.

Resistance to the growth of impoverishment in America is taking the form of loosely-organized, decentralized groups who have a base in community activism and come together in various protests. In Florida, Nathan Pim explained how his group “Food Not Bombs,” which shares food with the homeless, is working with the Occupy movement to support protests at the Republican conference. He told Naked Capitalism: “We’re doing all of our events out of Occupy Tampa’s park, which is called Voice of Freedom Park. We’re planning on trying to get, if people want shelter or food or water or something – we’re going to be helping to bring some food to protests, but we’re also letting people know if they need other services and we’re not doing a sharing at that time, that we’re going to be trying to provide it back at Occupy Tampa’s location.”

The neighborhood around Occupy Tampa’s park is pretty supportive, he said.  “You see like the same people every single day. They come by and talk. There’s people that come byto show support. … There’s always people just coming through and like talking to us. Sometimes I think there’s been people starting rumors about it being like not so great, but – and it is weird, you know, honestly, obviously, mostly younger white Occupiers in like an almost totally black neighborhood, but I think it’s actually been, in the month I’ve been here I’ve had pretty much nothing but good experiences with all the people of West Tampa.”

Although they are unlikely to get near any of the Republican delegates, the Coalition to March on the RNC intends to rally anyway, defying the weather and demanding good jobs, healthcare, affordable education, equality, and peace. Nonviolent direct action marches will take place every day at 10 am as an alternative to the official “event zone” declared by the city and police. Occupiers have been able to set up a “Romneyville” encampment legally on the edge of downtown for protesters to stay. These witnesses of conscience are determined to make public the realities of American private lives in the bank-created recession so that we are reminded that in this election our fight for the common good is at stake.

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Filed under 2012 Election, austerity measures, debt limit impasse, occupy wall street, police presence, poverty, Republicans, We are the 99 percent

Hot Delivery, Cold Comfort: Obama’s Message to the 99 Percent

Although the winter has meant that the Occupy movement has not been able to maintain its most visible presences, it still dominates political discourse in America. It cast a long shadow over Obama’s State of the Union speech Tuesday, which, while delivered with a preacher’s skill, was a piece of political theater aimed at diffusing Occupy’s message.

Obama framed his narrative with multiple appeals to national unity as a counter to economic inequality – spinning a patriotic fantasy of energy and manufacturing self-sufficiency. The country’s victory in the Second World War was followed, he said, by “a story of success that every American had a chance to share.” He ignored the divisiveness of racism and the struggle of black Americans in the Civil Rights movement in order to get that same chance.

He cajoled the rich to contribute to economic fairness. The Washington Post commented: “the heart of Obama’s message — one he has underscored in appearances around the country in recent months — was that America’s wealthiest citizens must do more to cement the economic recovery and pull the country from its dire fiscal condition.”

Appealing to the rich sounds good, but achieves nothing without state compulsion. According to Talking Points Memo “the new push suggests a growing confidence on [the Democratic leaders’] part that the public has tired significantly of the anti-government themes of 2010 and 2011 like slashing federal programs and shrinking the size of the federal government. They represent a populist turn for a Democratic incumbent, suggesting a recognition that these views have gone mainstream…”

So the whole speech was attuned to the change in the public mood, but without any substantive change in the administration’s political strategy. The populist turn was encapsulated by Obama’s call for a 30 percent tax on millionaires’ income. Given Romney’s tax disclosures less than 24 hours before, this was an easy target; but achieving such a tax would involve mobilizing the public for an all-out war on the political influence of the ruling elite – not marshaling them to vote for another presidential term.

Obama’s most cynical political ploy was his announcement of a federal investigation into Wall Street. Obama’s exact words were: “I am asking my Attorney General to create a special unit of federal prosecutors and leading state attorneys general to expand our investigations into the abusive lending and packaging of risky mortgages that led to the housing crisis. This new unit will hold accountable those who broke the law, speed assistance to homeowners, and help turn the page on an era of recklessness that hurt so many Americans.”

MoveOn was completely taken in by this rhetoric and lost no time emailing its constituents asking them to thank Obama for a “progressive victory.” It is no such thing. The Washington Post commented: “This is nothing new. Obama formed a similar task force over two years ago to accomplish the same objective. The task force has brought a number of high profile cases, but many observers have been disappointed that regulators and prosecutors have been unable to bring a criminal case against a high-profile banking executive involved in the financial crisis.” Attorney General Eric Holder has been unable to prosecute a single banker, while he has brought six prosecutions against alleged leakers under draconian espionage laws.

The NYT pointed out: “the proposals seek to acknowledge the continuing frustration among many Americans — exemplified by the Occupy Wall Street movement — that few financial executives have been prosecuted for their actions leading up to the crisis. Given the election-year pressures and the continuing gridlock on Capitol Hill, neither measure is certain to win approval in this session of Congress.”

Far from embracing the demands of the 99 percent, Obama has simply made a tactical change, acknowledging the extent of frustration with economic inequality, while doing nothing in practice to change the political control of Washington by the financial industry – the NYT comments that his ultimate goal “remains a bipartisan deficit deal along the lines of the one he nearly negotiated with Speaker John A. Boehner.”

Yves Smith was scornful of the whole thing. She points out that the proposal simply creates another task force staffed with people who have deep ties to the financial industry. “If you wanted a real investigation, you get a real independent investigator, with a real budget and staffing, and turn him loose. We had the FCIC which had a lot of hearings and produced a readable book that said everyone was responsible for the mortgage crisis, which was tantamount to saying no one was responsible. We even had an eleven-regulator Foreclosure Task Force that looked at 2800 loan files (and a mere 100 foreclosures) and found nothing very much wrong.

“Now we have a committee full of people who have made numerous statements in the media and to Congressional committee minimizing the severity of the mortgage mess. Are we to believe they all had a conversion experience on the eve of the State of the Union address? But apparently the members of what passes for the left are prepared to take ‘investigation’ at face value since it would be unpleasant to consider the possibility that they are being snookered again.

“And it seems awfully plausible that the aim of getting [New York Attorney General] Schneiderman on board with an Administration ‘investigation’ is to undermine the effort by 15 Democrat attorneys general to devise their own strategy for dealing with mortgage abuses. … It would be better if I were proven wrong, but this looks to be yet another clever Obama gambit to neutralize his opposition. With all the same key actors in place – Geithner, Walsh, Holder – there is no reason to believe the Administration has had a change of heart until there is compelling evidence otherwise.”

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Filed under 2012 Election, bank foreclosures, debt limit impasse, financiers, Obama, occupy wall street, populism, We are the 99 percent