Sumber : Dissent magazine
Neither Revolution Nor Reform: A New
Strategy for the Left
For
over a century, liberals and radicals have seen the possibility of change in
capitalist systems from one of two perspectives: the reform tradition assumes
that corporate institutions remain central to the system but believes that
regulatory policies can contain, modify, and control corporations and their
political allies. The revolutionary tradition assumes that change can come
about only if corporate institutions are eliminated or transcended during an
acute crisis, usually but not always by violence.
But what happens if a system neither reforms nor collapses
in crisis?
Quietly, a different kind of progressive change is emerging, one
that involves a transformation in institutional structures and power, a process
one could call “evolutionary reconstruction.” At the height of the financial
crisis in early 2009, some kind of nationalization of the banks seemed
possible. “The public hates bankers right now,” the Brookings Institution’s
Douglas Elliot observed. “Truthfully, you would find considerable support for
hanging a number of bankers…” It was a moment, Barack Obama told banking CEOs,
when his administration was “the only thing between you and the pitchforks.”
But the president opted for a soft bailout engineered by Treasury Secretary
Timothy Geithner and White House economic adviser Lawrence Summers. Whereas
Franklin Roosevelt attacked the “economic royalists” and built and mobilized
his political base, Obama entered office with an already organized base and
largely ignored it.
When the next financial crisis occurs, and it will, a different
political opportunity may be possible. One option has already been put on the
table: in 2010, thirty-three senators voted to break up large Wall Street
investment banks that were “too big to fail.” Such a policy would not only
reduce financial vulnerability; it would alter the structure of institutional
power.
Still, breaking up banks, even if successful, isn’t the end of
the process. The modern history of the financial industry, to say nothing of
anti-trust strategies in general, suggests that the big banks would ultimately
regroup and reconcentrate and restore their domination of the system. So what
can be done when “breaking them up” fails?
The potentially explosive power of public anger at financial
institutions surfaced in May 2010 when the Senate voted by a 96-0 margin to
audit the Federal Reserve’s lending (a provision included ultimately in the
Dodd-Frank legislation, which was designed to protect American taxpayers and
consumers from financial corruption and to make the financial system more
accountable)—something that had never been done before. Traditional reforms
have aimed at improved regulation, higher reserve requirements, and the
channeling of credit to key sectors. But future crises may feature a
spectrum of sophisticated proposals for more radical change offered by figures
on both the left and right. For instance, a “Limited Purpose Banking” strategy
put forward by conservative economist Laurence Kolticoff would impose a
100-percent reserve requirement on banks. Because banks typically provide loans
in amounts many times their reserves, this would transform them into modest institutions
with little or no capacity to finance speculation. It would also nationalize
the creation of all new money as federal authorities, rather than the banks,
would directly control system-wide financial flows. A variety of respected
liberal as well as conservative economists have welcomed this
strategy—including five Nobel laureates in economics.
On the left, the economist Fred Moseley has proposed that for
banks deemed too big to fail “permanent nationalization with bonds-to-stocks
swaps for bondholders is the most equitable solution…” Nationally owned banks,
he argues, would provide a basis for “a more stable and public-oriented banking
system in the future.” Most striking is the argument of Willem Buiter, the
chief economist of Citigroup no less, that if the public underwrites the costs
of bailouts, “banks should be in public ownership…” In fact, had the taxpayer
funds used to bail out major financial institutions in 2007–2010 been provided
on condition that voting stock be issued in return for the investment, one or
more major banks would, in fact, have become essentially publicly controlled
banks.
Unknown to most Americans, there have been a large number of
small and medium-sized public banking institutions for some time now. They have
financed small businesses, renewable energy, co-ops, housing, infrastructure,
and other specifically targeted areas. There are also 7,500 community-based
credit unions. Further precedents for public banking range from Small Business
Administration loans to the activities of the U.S.-dominated World Bank. In
fact, the federal government already operates 140 banks and quasi-banks that
provide loans and loan guarantees for an extraordinary range of domestic and
international economic activities. Through its various farm, housing,
electricity, cooperative and other loans, the Department of Agriculture alone
operates the equivalent of the seventh largest bank in America.
The economic crisis has also produced widespread interest in the
Bank of North Dakota, a highly successful state-owned bank founded in 1919 when
the state was governed by legislators belonging to the left-populist
Nonpartisan League. Over the past fourteen years, the bank has returned $340
million in profits to the state and has broad support in the business community
as well as among progressive activists. Legislative proposals to establish
banks patterned in whole or in part on the North Dakota model have been put
forward by activists and legislators in Washington, Oregon, California,
Arizona, New Mexico, Montana, Illinois, Louisiana, New York, Maryland,
Virginia, Maine, and Massachusetts. In Oregon,
with strong support from a coalition of farmers, small-business owners, and
community bankers, and backed by State Treasurer Ted Wheeler, a variation on
the theme, “a virtual state bank” (that is, one that has no storefronts but
channels state-backed capital to support other banks) is likely to be formed in
the near future. How far the various strategies may develop is likely to depend
on the intensity of future financial crises, the degree of social and economic
pain and political anger in general, and the capacity of a new politics to
focus citizen anger in support of major institutional reconstruction and
democratization.
That a long era of social and economic austerity and failing
reform might paradoxically open the way to more populist or radical
institutional change—including various forms of public ownership—is also
suggested by emerging developments in health care. Here the next stage of
change is already under way. At first, it is likely to be harmful. Republican
efforts to cut back the mostly unrealized benefits of the Affordable Care Act,
passed in 2010, provide one example of this. The first stages, however, are not
likely to be the last. Polls show overwhelming distrust of and deep hostility
toward insurance companies. We can also expect public outrage to be fueled by
stories like that of fifty-nine-year-old James Verone who attempted to rob a
bank in Gastonia, North Carolina this year—but only, he made clear, for one
dollar. The reason: unemployed and without health insurance, Verone simply saw
no way other than going to jail to get health care for a growth on his chest,
foot difficulties, and back problems.
Cost pressures are building in ways that will also continue to
undermine corporations facing global competitors, forcing them to seek new
solutions. A recent report from the federal Centers for Medicare and Medicaid
Services (“National Health Expenditure Projections, 2009–2019”) projects health
care costs to rise from the 2010 level of 17.5 percent of GDP to 19.6 percent
in 2019. It has long been clear that the central question is to what extent,
and at what pace, underlying cost pressures ultimately force development of
some form of single-payer system—the only serious way to deal with the
underlying problem.
A NEW national solution is ultimately likely to come either in response to a burst of
pain-driven public outrage or more
slowly through a state by state build up to a national system. Massachusetts, of course, already has a near universal
plan, with 99.8 percent of children covered and 98.1 percent of adults. In Hawaii, health coverage
(provided mostly by nonprofit insurers) reaches 91.8 percent of adults in large
part because of a 1970s law mandating low cost insurance for anyone working
twenty hours or more a week. In Vermont,
Governor Peter Shumlin signed legislation in May 2011 creating “Green Mountain
Care,” a broad effort that would ultimately allow state residents to move into
a publicly funded insurance pool—in essence a form of single-payer insurance.
Universal coverage, dependent on a federal waiver, would begin in 2017 and
possibly as early as 2014. In Connecticut,
legislation approved in June 2011 created a “SustiNet” Health Care Cabinet directed
to produce a business plan for a nonprofit public health insurance program by
2012, with the goal of offering such a plan beginning in 2014. In California, there is a
good chance a universal “Medicare for all” bill may be on the governor’s desk
for signature by mid-2012. (Similar legislation passed by both the House and
the Senate was vetoed by then-Governor Schwarzenegger in 2006 and 2008.) In
all, nearly twenty states will soon consider bills to create one or another
form of universal health care.
One can also observe a developing institutional dynamic in the
central neighborhoods of some of the nation’s larger cities, places that have
consistently suffered high levels of unemployment and underemployment, with
poverty commonly above 25 percent. In such neighborhoods, democratizing
development has also gone forward, again paradoxically, precisely because
traditional policies—in this case involving large expenditures for jobs,
housing and other necessities—have been politically impossible. “Social enterprises”
that undertake businesses in order to support specific social missions now
increasingly make up what is sometimes called “a fourth sector” (different from
the government, business, and nonprofit sectors). Roughly 4,500 not-for-profit
community development corporations are largely devoted to housing development.
There are now also more than eleven thousand businesses owned in whole or part
by their employees; five million more individuals are involved in these
enterprises than are members of private-sector unions. Another 130 million
Americans are members of various urban, agricultural, and credit union
cooperatives. In many cities, important new “land trust” developments are
underway using an institutional form of nonprofit or municipal ownership that
develops and maintains low- and moderate-income housing.
The various institutional efforts have also begun to develop
innovative strategies that suggest broader possibilities for change. Consider
the Evergreen Cooperatives in Cleveland,
Ohio, an integrated group of
worker-owned companies, supported in part by the purchasing power of large
hospitals and universities. The cooperatives include a solar installation
company, an industrial scale (and ecologically advanced) laundry, and soon a
greenhouse capable of producing more than five million heads of lettuce a year.
The Cleveland effort, which is partly modeled on
the nearly 100,000 person Mondragón cooperatives in the Basque region of Spain, is on
track to create new businesses, year by year, as time goes on. However, its
goal is not simply worker ownership, but the democratization of wealth and
community-building in general in the low-income Greater University Circle area
of what was once a thriving industrial city. Linked by a nonprofit corporation
and a revolving fund, the companies cannot be sold outside the network; they
also return 10 percent of profits to help develop additional worker-owned firms
in the area. (Full disclosure: The Democracy Collaborative, which I co-founded,
has played an important role in helping develop the Cleveland effort. See
www.Community-Wealth.org for further information on this and many other local
and state efforts.)
Another innovative enterprise is Market
Creek Plaza
in San Diego.
There a comprehensive, community-owned project links individual and collective
wealth-building through a $23.5-million commercial and cultural complex
anchored by a shopping center. The complex has developed a range of social and
economic projects that have resulted in the employment of more than 1,700
people. Its multicultural emphasis on the arts has helped create several venues
for common activity among the local Asian, Hispanic, and black communities.
Significantly, these collectively owned businesses are commonly
supported by unusual local alliances, including not only progressives; labor unions; and nonprofit and religious
leaders; but also, in many cases,
the backing of local businesses and bankers. The efforts have also attracted surprising political support.
In Indiana,
for example, Republican State Treasurer Richard Mourdock has established a
state linked deposit program to provide state financing support for employee
ownership. At this writing, Ohio Democratic Senator Sherrod Brown has plans to
introduce model legislation to support the development of an initial group of
Evergreen-style efforts in diverse parts of the country. Environmental concerns
are also involved; many of the enterprises are “green” by design, increasingly
so as time goes on. Cleveland’s Evergreen
laundry, which uses less than a third the amount of water used by comparable
commercial firms, is one of the most ecologically advanced in the Midwest. In Washington
state, Coastal Community Action (CCA) operates a portfolio of housing, food,
health, and employment programs for low-income residents that uses development
and ownership of a fourteen million dollar wind turbine to generate income to
support its social service programs.
Yet another sphere of institutional growth centers on land
development. By maintaining direct ownership of areas surrounding transit
station exits, public agencies in Washington, D.C., Atlanta,
and other cities earn millions capturing the increased land values their
transit investments create. The town of Riverview,
Michigan, has
been a national leader in trapping methane from its landfills and using it to
fuel electricity generation, thereby providing both revenues and jobs.
There are roughly five hundred similar projects nationwide. Many cities have
established municipally owned hotels. There are also over two thousand publicly
owned utilities that provide power (and, increasingly, broadband services) to
more than forty-five million Americans, in the process generating $50 billion
in annual revenue. Significant public institutions are also common at the state
level. CalPERS, California’s public pension authority, helps finance local
community development needs; in Alaska, state oil revenues provide each citizen
with dividends from public investment strategies as a matter of right; in
Alabama, public pension investing has long focused on state economic
development (including employee-owned firms).
ALTHOUGH PUBLIC ownership is surprisingly widespread, it can
also be vulnerable to challenge. The fiscal crisis, and conservative resistance
to raising taxes, has led some mayors and governors to sell off public assets.
In Indiana,
Governor Mitch Daniels sold the Indiana
Toll Road to Spanish and Australian investors. In
Chicago, then-Mayor Richard Daley privatized parking meters and toll collection
on the Chicago Skyway and even proposed selling off recycling collection,
equipment maintenance, and the annual “Taste of Chicago” festival. How far
continuing financial and political pressures may lead other officials to
attempt to secure revenues by selling off public assets is an open question.
Public resistance to such strategies, although less widely publicized, has been
surprisingly strong in many areas. Toll road sales have been held up in Pennsylvania and New Jersey,
and newly elected Chicago Mayor Rahm Emanuel recently voiced his opposition to
an attempt to privatize Midway
Airport as previously
attempted by Daley. An effort to transfer city-owned parking garages to private
ownership in Los Angeles
also failed when residents and business leaders realized parking rates would
spike if the deal went through.
One thing is certain: traditional liberalism, dependent on
expensive federal policies and strong labor unions, is moribund. The government
no longer has much capacity to use progressive taxation to achieve the goal of
equity or to regulate corporations effectively. Congressional deadlocks on such
matters are the rule, not the exception. At the same time, ongoing economic
stagnation or mild upturns followed by further decay, and “real” unemployment
rates in the 15 percent to 16 percent range appear more likely than a return to
booming economic times.
IRONICALLY, THIS grim new order may open the
way for the kinds of “evolutionary reconstructive” institutional change
described here. Since the Great Depression, liberal activists and policy makers
have implicitly assumed they were providing one or another form of
“countervailing power” against large corporations. But institutional
reconstruction aims either to weaken or displace corporate
power. Strategies like anti-trust or efforts to “break up” big banks aim to
weaken. Public banking, municipal utilities, and single-payer health plans
attempt to displace privately owned companies. At the same time,
community-based enterprises offer public officials alternatives to paying large
tax-incentive bribes to big corporations.
Of course, “evolutionary reconstruction” might fail, as have
most kinds of top-down national reform. The era of stalemate and decay might
continue and worsen. Like ancient Rome,
the United States could simply decline and fall, unable to address its social
ills.
However, even during a sustained era of stalemate and decay, it
may be possible to develop a coherent long-term progressive strategic
direction. Such a direction would build upon the remaining energies of
traditional liberal reform, animated over time by new populist anger and
movements aimed at confronting corporate power, the extreme concentration of
income, failing public services, the ecological crisis, and military
adventurism. And it would explicitly advocate the construction of new
institutions run by people committed to developing an expansively democratic
polity, thereby giving political voice to the new constituencies emerging
alongside the new developments at the same time it helps to begin altering
underlying institutional power balances.
In connection with environmental issues, at least, some
“capitalists” also seem willing to sign onto this vision. New organizations
like the Business Alliance for Local Living Economies (BALLE) and the American
Sustainable Business Council (ASBC) have been quietly developing momentum in
recent years. BALLE, which has more than 22,000 small business members, works
to promote sustainable local community development. ASBC (which includes BALLE
as a member) is an advocacy and lobbying effort that involves more than 150,000
business professionals and 30 separate business organizations committed to
sustainability. Leading White House figures and such Cabinet-level officials as
Labor Secretary Hilda Solis have welcomed the organization as a counter to the
national Chamber of Commerce. (Jeffrey Hollender, chair of ASBC’s Business
Leadership Council and former CEO of Seventh Generation, has denounced the
Chamber for “fighting democracy and destroying America’s economic future”
because of its opposition to climate change legislation and its support for the
Citizens United decision.) Gus Speth, a member of ASBC’s Advisory Board (and
former environmental adviser to Presidents Carter and Clinton) offers a more
far-reaching general perspective: “For the most part, we have worked within
this current system of political economy, but working within the system will
not succeed in the end when what is needed is transformative change in the
system itself.”
AT THE heart of the spectrum of emerging
institutional change is the traditional radical principle that the ownership of
capital should be subject to democratic control. In a nation where 1 percent of
the population owns nearly as much wealth as the entire bottom half of the nation,
this principle may be particularly appealing to the young—the people who will
shape the next political era. In 2009, even as Republicans assailed President
Obama and his liberal allies as immoral “socialists,” a Rasmussen poll reported
that Americans under thirty were “essentially evenly divided” as to whether
they preferred “capitalism” or “socialism.” Even if many were unsure about what
“socialism” is, they were clearly open to something new, whatever it might be
called. A non-statist, community-building, institution-changing, democratizing
strategy might well capture their imagination and channel their desire to heal
the world. It is surely a positive direction to pursue. Just possibly, it could
open the way to an era of true progressive renewal, even one day perhaps
step-by-step systemic change or the kind of unexpected, explosive,
movement-building power evidenced in the “Arab Spring” and, historically, in
our own civil rights, feminist, and other great movements. (SUMBER :
http://dissentmagazine.org/article/?article=4056)
1)
neither … nor
|
·
Neither Revolution Nor
Reform: A New Strategy for the Left
(Tidak revolusi maupun reformasi: Strategi baru untuk menggantikan yang lama)
·
But
what happens if a system neither reforms nor collapses in crisis?
(tetapi apa yang terjadi jika sebuah system tidak reformasi
maupun gagal saat krisis?)
|
2)
either … or
|
· But institutional reconstruction aims either
to weaken or displace corporate power.
(Tapi
kelembagaan rekonstruksi bertujuan baik untuk melemahkan atau menggantikan
kekuasaan korporasi)
· A NEW national solution is ultimately likely
to come either in response to a burst of pain-driven public outrage or more
slowly through a state by state build up to a national system.
(Sebuah
solusi nasional baru yang akan datang baik dalam menanggapi ledakan pain-driven
kemarahan publik atau lebih lambat negara oleh negara melalui membangun
sistem nasional)
|
3)
both … and
|
·
But
future crises may feature a spectrum of sophisticated proposals for more
radical change offered by figures on both the left and right
(Tapi
teriakan masa depan mungkin fitur spektrum dari proposal yang hebat untuk
perubahan radikal yang ditawarkan oleh penggambaran diantara kiri dan kanan)
·
The
town of Riverview, Michigan, has been a national leader in
trapping methane from its landfills and using it to fuel electricity
generation, thereby providing both revenues and jobs
(Kota Riverview,
Michigan, telah menjadi
pemimpin nasional dalam mengolah metana dari tempat pembuangan sampah dan
menggunakannya untuk bahan bakar pembangkit listrik, sehingga memberikan
pendapatan dan pekerjaan)
|
4)
not only … but also
|
Significantly, these
collectively owned businesses are commonly supported by unusual local
alliances, including not only progressives; labor unions; and nonprofit and
religious leaders; but also, in many cases, the backing of local businesses
and bankers
(Secara signifikan,
ini secara kolektif dimiliki pebisnis yang umumnya didukung oleh aliansi
lokal yang tidak biasa, termasuk tidak hanya yang berkembang; buruh; dan
nirlaba dan pemimpin religius; tapi juga, dalam banyak kasus, dukungan dari
pebisnis lokal dan bankir)
|
