Forum Post: FreeDA: Taking Freedom Into Our Own Hands
Posted 1 year ago on Dec. 18, 2011, 7:01 p.m. EST by LeoYo
(1889)
This content is user submitted and not an official statement
The Free Democracy Amendments
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Barring violation to the rights of others, the right of a free people to be secure in their individual decisions of personal safety, ingestion, expression, activity, association, and property, shall not be violated without due process of law.
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The freedom from direct taxation being necessary for the right of a free people to be sovereign in the ownership of their labor and of their property, the imposition of direct taxation shall be restricted at all levels of government to the voluntary patrons of social welfare services, allowing for only indirect taxation for non-patrons.
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Neither slavery nor involuntary servitude shall exist within the United States or any place subject to their jurisdiction.
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Barring conviction for either treason or for voting fraud, the right of all mentally coherent adult citizens to vote at all levels of government shall be guaranteed, the violation of which shall be punishable with equivalence to an act of treason.
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The right of a politically free and democratic people to engage in Initiative, Referendum, and Recall, to have all of their votes counted, and to be without the undemocratic imposition of an electoral college, shall be guaranteed at all levels of government.
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The provision of Patriot Dollars to voters for the sole funding of political campaigns at all levels of government shall be enacted to keep political campaigns free from the undemocratic influences of monied interests that shall be prohibited from funding any political advertisements outside of political campaigns.
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The offering or acceptance of any item or service of value including but not limited to the offering or acceptance of future employment involving a public official or candidate for public office of any branch or level of government shall be prohibited and punishable with equivalence to an act of treason.
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All communication to take place between a lobbyist and a public official shall be public and open to the press, the violation of which shall be punishable with equivalence to an act of treason.
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The separation of corporation and state being necessary for the independence of a democratic government in serving the needs of the people, no public service shall be under the management of a private sector entity and each State of the United States shall have a state bank collectively forming the Union Reserve Bank of the United States with a state appointed bank official from each State to compose the Union Board of Governors exercising all the responsibilities of the Open Market Committee.
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Any private business acquiring a national market share large enough to be a detriment to the national economy upon the business' failure shall undergo divestment into smaller units assessed to be economically secure for fallibility in the national economy.
Prior to a national ratification, the Free Democracy Amendments, collectively referred to as the FreeDA Liberty Bill, can be enacted at the state level in the 24 ballot initiative states where a Union Reserve Bank could be formed from the newly created state banks whose state appointed bank officials would serve as the Union Board of Governors with all the responsibilities of the Open Market Committee.
Trans-Partisan Cooperative Voting: Establishing Political Accountability
Voter public control through the application of Free Democracy Affidavits http://occupywallst.org/forum/freeda-template/ or FreeDA can be the solution to bringing about political accountability under conditions in which ballot initiatives, referendums, and recalls, are not an option. For the People to be free, politicians must be legally bound to serving the specific interests of the People rather than the interests of the corporations. By refusing to vote for any candidate who doesn't sign an affidavit legally committing that candidate to supporting the will of the People, voters will be able to exercise their democratic power to hold the candidates who do sign and are elected, legally accountable. However, VOTERS MUST REMAIN UNITED ACROSS PARTY LINES IN THEIR AGREEMENT ON THE AFFIDAVITS AND IN THEIR REFUSAL TO VOTE FOR CANDIDATES WHO WON'T SIGN THE AFFIDAVITS. This trans-partisan cooperation is essential to the success of bringing about permanent political reform, taking freedom into our own hands. The greatest support shall come from the participation of independent voters. If, initially, no candidates are willing to sign in the election in which the affidavits are first presented, it will only be a matter of time before both partisan and non-partisan willing candidates emerge from among the FreeDA supporters in subsequent elections. In accordance with amendments 6, 7, 8, and 9, of the Liberty Bill, the FreeDA signers would also be signing on to affirmations of not accepting campaign contributions from corporations and non-profits, not accepting gifts from special interests once in office, making all communication with lobbyists open to the press and the public, and not having an account with a private bank. In support of such candidates, a FreeDA 501(c)4 PAC would receive contributions to fund ads for all of the FreeDA signers collectively.
What if an elected FreeDA signer declines to uphold an affirmation of the affidavit and the justice system declines to enforce the law? Since the elected official had the majority of the voters' support to win the election, the action to take place in response to a failure of justice will be by that same voting majority as well as by other FreeDA supporting voters from throughout the state. The action that these voters take will have to result in the total shut down of their state capitol along with a demand of the appropriate legal penalties to be enforced against the state attorney general for declining to prosecute the affidavit violator on the grounds of perjury. It is a battle for justice that must be won as the outcome will establish the precedent for all future outcomes. Civil disobedience, a general strike among the non-legal profession employees of the state justice department, and other tactics will have to be well planned in advance on a scale rivaling that of the 2011 Wisconsin protests to see the battle through. This voter solidarity across party lines in the use of affidavits and the demand for justice will be a people's revolution that either establishes democracy in America, setting an example for people of similar political situations to follow around the world, or fails and establishes the official American acceptance of the tyranny of corporate rule.
If the FreeDA Liberty Bill should ever be ratified, the provision for a national initiative would open the door to voting for a Democratic Congress http://occupywallst.org/forum/amendment-for-a-democratic-congress/.
Complementing the Free Democracy Amendments, both the FreeDA Municipal Economic Initiatives (or FreeDA/MEI) and the FreeDA Cooperative Employment Service (or FreeDA/CES) can be enacted at the municipal level to protect local economies from the ravages of corporate exploitation and stimulate the growth of promising communities such as the Evergreen Cooperatives http://evergreencooperatives.com/ .
FreeDA/MEI
To preserve the prosperity of the municipality and its local business community, the following ordinances compose FreeDA/MEI.
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No public service shall be under the management of a private sector entity.
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No formula business outlet shall exceed the size of the largest local business outlet of the same category.
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The number of business outlets for any formula business shall be limited to 1 outlet per every 50,000 inhabitants of the local municipal population.
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All municipal businesses shall have local bank accounts in which their profits shall be retained within the municipality and not be exported to anyplace outside of the municipality.
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All offshore exports to the municipality shall derive from foreign retail companies owned by natural born citizens of those countries.
FreeDA/CES
The FreeDA Cooperative Employment Service is the 501(c)4 organization that would assess the skills of the unemployed individuals to patronize it and match them with a suggested cooperative business plan. Upon acceptance or rejection of the plan for an alternative plan, the FreeDA/CES would facilitate the crowdfunding of the new cooperative business. Most likely to precede the establishment of FreeDA/CES would be a cooperative community composed of a Free Democracy Credit Union and its Free Democracy Mutual Insurance Company which together would lay the foundation of support for the FreeDA Cooperative Employment Service. With the nationwide establishment of the Free Democracy Credit Union, Free Democracy Mutual Insurance Company, and FreeDA Cooperative Employment Service, the unemployed of each city would be consistently channeled into either newly or already established worker-owner cooperatives, creating an American version of Mondragon http://www.mondragon-corporation.com/ENG.aspx and modifying the economic well-being of society at a fundamental level.
Moving Forward - A Tweet For Freedom
College students affiliated with http://www.uspirg.org/ the Public Interest Research Groups http://en.wikipedia.org/wiki/Public_Interest_Research_Group willing to work with the US Federation of Worker Cooperatives http://www.usworker.coop/front and Democracy At Work http://www.democracyatwork.info/ are the only individuals to have the organizational history, academic resources, and activist drive to actually champion FreeDA. Without an interest from such students, it's doubtful anyone else will ever take up the cause for FreeDA. After all, "None are more hopelessly enslaved http://occupywallst.org/forum/none-are-more-hopelessly-enslaved-than-those-who-f/ than those who falsely believe they are free." However, even the average person can help champion the cause of FreeDA by simply spreading word of FreeDA through Twitter as with knowledge comes the freedom to decide one's own actions and with the freedom to decide, the freedom to take action.
"Find out just what any people will quietly submit to and you have found the exact measure of injustice and wrong which will be imposed upon them" -Frederick Douglass
"None are more hopelessly enslaved than those who falsely believe they are free." -Goethe
http://occupywallst.org/forum/none-are-more-hopelessly-enslaved-than-those-who-f/
I paraphrased this quote recently - but couldn't remember who said it ! Thanx for this singular 'forum-post' and thread and also for your thoughts and efforts on this matter. I commend you wholeheartedly and think that there is much to reflect upon here.
pax, amor et lux ...
Do you have this one?
The Incestuous Relationship Between Bankers, Business and Congress
Saturday, 10 November 2012 12:48 By Chris Paulus, Occupy.com | News Analysis
http://truth-out.org/news/item/12665-the-incestuous-relationship-between-bankers-business-and-congress
Check out
How Big Banks Run the World - at Your Expense http://truth-out.org/news/item/9658-how-big-banks-run-the-world-at-your-expense
Thanx. Gar Alperovitz is right in the vanguard of the necessary 'new thinking' in The U$A. I really appreciate your heads up on this and from the article :
fiat lux ...
How Wall Street Won the Election Long Before the First Vote Was Cast
Saturday, 27 October 2012 09:29 By Nomi Prins, AlterNet | News Analysis
http://truth-out.org/news/item/12358-how-wall-street-won-the-election-long-before-the-first-vote-was-cast
W0W Leo, GR8 link !! Nomi Prins is an ex Goldman Sachs banker and a very astute commentator, journalist and novelist. Thanx & :
fiat justitia ...
I'm unable to post these anytime soon as I've recently made a post so I thought you might be interested in posting them.
Cannibalistic Capitalism and Green Resistance
Friday, 31 August 2012 00:00 By Craig Collins PhD, Truthout | News Analysis
http://truth-out.org/news/item/11173-cannibalistic-capitalism-and-green-resistance
Money in Politics: Where Is the Outrage?
Friday, 31 August 2012 09:38 By Bill Moyers and Bernard A. Weisberger, Moyers & Company | Op-Ed
http://truth-out.org/opinion/item/11257-money-in-politics-where-is-the-outrage
"Banks Weren’t Meant to Be Like This", by Prof. Michael Hudson :
Thanx 'Leo' I am interested and appreciate your links which I am saving for later perusal, reflection & possibly comment. SOLIDARITY & http://www.youtube.com/watch?v=t-l91O9VxN0 :-)
per aspera ad astra ...
Here's another article you may be interested in that I may try to post later.
The Myth That Japan Is Broke: The World's Largest "Debtor" Is Now the World's Largest Creditor
Saturday, 08 September 2012 07:25 By Ellen Brown, Truthout | News Analysis
http://truth-out.org/news/item/11414-the-myth-that-japan-is-broke-the-worlds-largest-debtor-is-now-the-worlds-largest-creditor
Excellent Link !!! 'eYe' Opening !! Thanx ! ~*~
fiat lux ..
http://www.globalissues.org/article/234/the-rise-of-corporations
also
http://reclaimdemocracy.org/local_business_benefits/
Excellent Linx !!! Equally 'eYe' Ohpening !! I thinx that thanx are in order again ! ~i~
fiat lux ...
http://truth-out.org/news/item/12203-are-big-banks-too-big-to-regulate?
Break Up Corporate Banking Cartels and reclaim the Lincolnian definition of democracy (Govt. of, by & for the people). Thanx for your excellent 'truth-out' article. Some more food for thought and reflection :
Educate ; Agitate ; Organise !!!
dum spiro, spero ...
No man can truly be free if he is bound by any law, any responsibility, or any form of censure.
No man can truly be free if no one is bound by the recognition of another's freedom.
Found this gem in all your comments. To me, it is the link between morality and true politics. Very cool.
Thanks.
As for 'supreme credit', I don't know what that is. Is that a reference to something I've posted or linked to?
What - you quoting ayn ?
I'm big on pig, actually... if I were to enclose a piglet in a ten by ten pen would you say that he was free or would you say that he is un-free? And now if I were to extend that fencing to create a 100 by 100 square foot enclosure would you say that the pig was free or would you say that he is un-free? Such is the nature of law. No one can truly be free if bounded by law. And in America, laws are but lines in the sand; they require our voluntary virtuous submission. Freedom, as you can plainly see, arrives as but a matter of degree. And so does slavery.
I'm not going to get into this right now - maybe some other time.
Take your time, a lifetime if you so desire...
So, the question I see is this: How free? -should We allow ourselves to be? I'm all for as much freedom as possible so long as our humanity remains intact, but I also believe a certain level of social responsibility is also required in order to maintain a civilized society. Like paying taxes for example. Can you imagine what would happen in this country if nobody was required to pay taxes? It's true the never-ending War-Machine would come to a screeching hault (which would be a good thing), but at the same time millions and millions of poor people would starve to death and the streets would become flooded with starving, dying homeless people with no government aid (which would be a bad thing). There would also be no more public schools, no more post offices, no more police stations, no more government, etc. etc.
I think there are many areas where we need to be "way more free" than we currently are, which for most people in America is hardly free at all. And at the same time there are also areas where some of us need to be "less free", like for example: billionaires being less "free" to exploit and to rule the world without any boundaries or limitations as they currently do.
100% Freedom is not even feasible, much less should it even be desirable or attempted within our current corrupt system. Until we evolve to the point where we actually solve our problems at the root instead of dealing with the never-ending symtoms of a failed corrupt system, we will never be as "free" as we could and should be.
"No one can truly be free if bounded by law." This is true. And it is also true that within our current corrupt system, certain laws are needed. 100% Freedom only works in a perfect or ideal world, which we are far from. Take the crime of "theft" for example. A starving, poor person steals an apple from an apple cart and is caught "red-handed" and put in jail for his "crime". Only in a world where the basic needs of people are guaranteed and everyone has their own apples would the law against apple-theft become unnessary and obsolete. Almost all "crime" is caused by our corrupt monetary system (the root of the problem) that intentionally produces scarcity and a struggling under-class. Seriously. There is a reason why rich people don't steal apples from apple carts. Why would they? But this is not to say that rich people are never motivated to steal from other people. They just do it in other ways, like for example, under-paying workers through a lifetime of exploitation because they are "free" to do so and there is no "law" against it. In this case what is being stolen is the lives of the hundreds or thousands or millions of exploited workers who spend their entire lives working hard everyday just to barely survive, while the rich CEO's bank account overflows with most all of the profits from their labor, which is much more than just an apple from an apple cart. In fact, (for the purpose of this example) it's likely the starving, poor apple-thief who stole the apple from the apple cart was one of the workers who worked hard everyday for the rich CEO and yet still couldn't even afford to buy the apple. :-) Yet the apple-thief goes to jail while the rich CEO remains free.
"The greatest weapon in the hands of the oppressor is the mind of the oppressed." -Stephen Biko
we don't all own property
I'm not understanding the relevence of your reply.
those that don't own property must follow the rules of the owner of property they are on
Okay, I understand that. What I don't understand is what that has to do with the posted quote that was replied to or what it is intended to be in response to.
the response is at the top of the list
nothing to do with the fortune cookie
1.Barring violation to the rights of others, the right of a free people to be secure in their individual decisions of personal safety, ingestion, expression, activity, association, and property, shall not be violated without due process of law.
Okay, so we don't all own property and those that don't own property must follow the rules of the owner of property they are on so long as it's not in violation of their rights.
Property is more than real estate.
Agreed.
Mother, mother
There's too many of you crying
Brother, brother, brother
There's far too many of you dying
You know we've got to find a way
To bring some lovin' here today - Ya
.
Father, father
We don't need to escalate
You see, war is not the answer
For only love can conquer hate
You know we've got to find a way
To bring some lovin' here today
.
Picket lines and picket signs
Don't punish me with brutality
Talk to me, so you can see
Oh, what's going on
What's going on
Ya, what's going on
Ah, what's going on
.
In the mean time
Right on, baby
Right on
Right on
.
Father, father, everybody thinks we're wrong
Oh, but who are they to judge us
Simply because our hair is long
Oh, you know we've got to find a way
To bring some understanding here today
Oh
.
Picket lines and picket signs
Don't punish me with brutality
Talk to me
So you can see
What's going on
Ya, what's going on
Tell me what's going on
I'll tell you what's going on - Uh
Right on baby
Right on baby
http://www.youtube.com/watch?v=9KKEXZTrvAU
Oh, mercy mercy me
Oh, things ain't what they used to be
No, no
Where did all the blue sky go?
Poison is the wind that blows
From the north, east, south, and sea
Oh, mercy mercy me
Oh, things ain't what they used to be
No, no
Oil wasted on the oceans and upon our seas
Fish full of mercury
Oh, mercy mercy me
Oh, things ain't what they used to be
No, no
Radiation in the ground and in the sky
Animals and birds who live nearby are dying
Oh, mercy mercy me
Oh, things ain't what they used to be
What about this overcrowded land?
How much more abuse from man can you stand?
My sweet Lord
My sweet Lord
My sweet Lord
http://www.youtube.com/watch?v=EMuWmU1iNJo
Oh, mercy mercy me
Workplace Democracy: Equality Over Profit
Wednesday, 22 May 2013 09:09 By David Morgan, Truthout | Op-Ed
http://truth-out.org/opinion/item/16520-workplace-democracy-equality-over-profit
Operating a workplace as a democracy in the contemporary business world isn't easy, Morgan says, but worker cooperatives are showing the way while thriving and multiplying.
Creating a new economy within the confines of predatory capitalism is an immense undertaking. The various oppressions that exist in society at large can insidiously take root in any new project if we don't work to undo their influence. Cooperatives, the democratic businesses leading the way in the struggle for a new economy, are no exception, and can be a difficult undertaking, given the lack of democracy in our daily lives. Contrary to our national mythology, we practice democracy very infrequently. Almost every organization, institution, or site of human interaction is governed by hierarchical principles, founded on individualism, and driven by competition. Even many social justice organizations can mimic corporate structures and assume these traits.
By contrast, cooperative businesses are an experiment in everyday democracy, and worker-ownership is something that is unfamiliar and challenging, requiring deliberation, commitment, and patience. If being democratic were as easy as sitting around a table and agreeing to make democratic decisions, our lives would be much simpler. Of course, the reality is quite different; we can get lost in egotism and conflict, fall into a cult of personality, or confuse democracy as an event, not a process. There are also fundamental business concerns like accessing startup capital and simply paying the bills.
Trying to find money to start a business is difficult for most, whatever kind of business one is hoping to start. Co-ops face an even steeper climb given the lack of understanding about how they differ from other businesses. Many banks are tentative about loaning to worker co-ops, which tend to be less singularly focused on profit and are often balancing a whole host of goals defined by their membership. A traditional business may sell shares of the company to raise funds, but most worker co-ops are wary about selling stock to those who aren't workers. Some worker co-ops do sell shares to raise money, but eliminate the shareholders' voting power. Since most investors want a say in the direction of the company, co-ops have to prove they are making a difference and a profit in order to attract outside money.
If start-up money is acquired, then co-ops must chart their way of working in their bylaws, either creating their structure anew or adopting a model from a like-minded group. This foundational step looks dramatically different from incorporating a hierarchical business. Each person comes to the table with different material needs, and it is the group's job to meet those so that the members can fully participate in the democratic process. Together, they decide not only the business' priorities and operating procedures, but also how decisions are made. Many worker cooperatives operate by consensus - meaning that until all members agree, a proposal is subject to revision or can be blocked outright - and operate on a one-member-one-vote policy, but this format has to be decided upon by the members at the outset. Enterprises that require many operating decisions to be made in a high pressure timeframe must be clear about how these are to be delegated and disagreements expeditiously resolved. What's more, co-ops grow and change, bring on new members, and with time, set new priorities. Consequently, their way of operating is dynamic, and needs to be adaptable to new circumstances.
It can be an arduous process to meet a variety of needs, both at the beginning while drafting bylaws, and on a daily basis. This careful balancing act hinges on how the co-op is governed. Each day, responsibilities are executed through the democratic decision-making process, which relies on trust and a sincere commitment to soliciting the input of others. It requires time to reach a decision democratically, and worker co-operatives grapple with prioritizing the process over the decision itself. When a high-stakes decision needs to be made, this can mean setting aside other tasks to focus the group's attention on a single issue. Contentious subjects can take a long time to address and personal feelings can become entangled with group objectives. This is, of course, not unique to the co-op model, and these group dynamics will be familiar to most workplaces. What sets co-ops apart is their dedication to ironing out tensions, and prioritizing fairness at all stages of the decision-making process.
As such, worker cooperatives deal with conflict differently than other businesses. It can be even harder to overcome conflict in a co-op than in a traditional workplace; it is easier to complain to someone's boss or union representative than to bring forth an issue directly to that person in a group setting. It can be especially difficult when dealing with larger oppressions, such as sexism and other marginalizing practices. These are often swept under the rug in a hierarchical workplace, but worker democracy gives workers space to deliberate on how these issues affect them and their work. While this process can be a strength for worker-coops, it requires a strong and supportive structure, so that the onus isn't solely on the individual to be outspoken and address the issues. It's also important that true whistleblowers feel they are respected and that their jobs aren't endangered by speaking out.
It is frequently argued that making timely decisions and dealing with conflict are magnified as the size of the co-op increases. Some claim that worker democracy can only be effective on a quite small scale, and many co-ops struggle with growing pains. Founding members can hold tightly to the co-op's initial priorities and processes, expecting new members to conform, rather than allow the co-op to change with time. In the nonprofit world, this is an oft-addressed problem known as founders' syndrome. As co-ops grow, however, they need to remain subject to worker control, and develop systems for accountability and transparency. Two of the largest cooperative systems in the world, Mondragon and Emilia Romagna, have succeeded in adapting in these ways, and have grown to include millions of members, who each have a say in how the system operates.
The cooperative movement is still learning how to best address these issues. The co-op movement has developed structures for teaching about what democracy looks like in the workplace. Despite operating within a context that is by its nature competitive, self-serving, and undemocratic - namely, the contemporary business world - worker cooperatives are not merely surviving but are thriving and multiplying, forming a bedrock of community control and localizing the economy. For the cooperative movement to succeed on a larger scale, the focus needs to remain on creating structures and systems of fairness and equality over those of expedience and profit.
Copyright, Truthout.
Exceptional thread, Leo!!
All the makings of "A People's Society".
Whenever I come across a good article on either cooperatives or on public banking, I always add them to this thread.
There are a few threads here that stand out from the rest, in that they have a more 'global community' feel that transcends politics. The bigger picture. This is definitely one of those threads. Thanks again Leo!
Thank you for the compliment.
New Era Windows Cooperative Is Open for Business in Chicago
Friday, 10 May 2013 10:47 By Laura Flanders, GritTV | Video Report
http://truth-out.org/news/item/16301-new-era-windows-cooperative-is-open-for-business-in-chicago
Meet the takers: They took over their factory, they took on their bosses, they took the initiative to form a worker cooperative and today they’re taking the wraps off a brand-new worker-owned company: New Era Windows. It opened May 9 in Chicago.
The workers in this story are members of the same workforce who, when they received word that their plant was about to be closed with no notice at what was then the Republic Windows and Doors factory in 2008, occupied their plant and became a cause celebre in a grim winter of mass layoffs. When they were laid off again in early 2012, by a second owner, they decided, as Nike would say, to “think different.” With encouragement from their union, the United Electrical, Radio & Machine Workers of America (UE), and The Working World, a progressive investment group that helps co-operative start-ups internationally, they formed a company, “New Era LLC.” New Era is 100 percent owned by workers and now, at last, open for business.
“We decided to make a co-op because we were tired of our life being in someone else’s hands,” window maker Melvin “Ricky” Macklin told GRITtv the day before the opening.
“When [Republic] closed we felt like it was the end of our lives...but we realized, we’re not nobody,” added co-worker/owner Armando Robles, president of the union local, UE 1110.
It hasn’t been easy. Last year the New Era team had to fight for several months even to be allowed to bid on the factory. After that came contract negotiations and a move to a cheaper new location. To save on expensive moving costs, workers shifted the equipment from their old plant, themselves, in 80 tractor trailer loads.
“There have been times that we weren’t sure that we were going to be able to get New Era off the ground,” recalled Macklin. “You need investors. Well, we didn’t have a lot of people knocking on the door to give us money.”
That’s where The Working World stepped in.
“We have to remember, it still has a long way to go,” says The Working World’s Brendan Martin. But the only way the company has been able to get launched in less than a year, he says, is because of the potential unleashed in the process of launching a cooperative. “If this were looked at by normal investment institutions, they’d have assumed it would cost $2-5 million to open a business like this. It’s been less than a million and the only reason for that is because that other $2-3 million of value has been brought by the workers.”
A day before the opening, workers were putting the final touches on the plant, showing the fire inspector around and thinking about the work ahead of them. With just twenty worker-owners currently employed, the factory space looks large. Will they get enough orders to fill it? They are confident (and they passed the fire code inspection).
The former owner of Republic Windows and Doors didn’t go bankrupt. He’s still operating a factory in town. New Era is small by comparison. As Martin put it, “They don’t have all the inside connections; they don’t have all the backroom buddies.”
On the other hand, they don’t need a massive profit margin to be viable, and they live in a community that needs good, modern windows.
“Now more than ever they need support,” says Martin. Among other clients, they’re hoping that housing cooperatives and other cooperative businesses will choose to buy their windows from New Era in solidarity. “It’s not just about financial support, but it is about customers,” he says.
Becoming owners brings with it new responsibilities and work. GRITtv asked the workers if they're nervous:
“In opening up this plant we have learned we are so much more than what we thought we were,” Macklin said. “In opening up this plant we’ve done our own electrical work, we’ve done the plumbing work. And all we thought was we were just window makers.”
You can read more about the journey to New Era here http://www.thenation.com/blog/168416/chicago-workers-economic-plan-go-co-operative , here http://www.thenation.com/blog/166534/worker-ownership-under-consideration-chicago-factory-occupied-2008 and here http://www.thenation.com/blog/168727/workers-vs-investors-famous-windows-factory-danger-liquidation and watch GRITtv's 2009 discussion of worker takeovers with Naomi Klein, Avi Lewis and UE organizer Leah Fried here http://blip.tv/grittv/naomi-klein-and-avi-lewis-why-can-t-we-fire-the-boss-2139852 . For more information on New Era, go to newerawindows.com.
This piece was reprinted by Truthout with permission or license.
Opting Out of Wall Street and Building Sustainable, Resilient Communities: Remaking Finance, Part III
Wednesday, 08 May 2013 00:00 By Margaret Flowers and Kevin Zeese, Truthout | News Analysis
http://truth-out.org/news/item/16233-opting-out-of-wall-street-and-building-sustainable-resilient-communities-remaking-finance-part-iii
This article is the continuation of a series on remaking our financial system so that it serves and protects people instead of the "too big to fail or jail" banks, collectively called big finance. More and more people see that the current financial system rewards those who hoard their money and invest in risky or damaging ventures such as derivatives and other forms of speculation and are asking: how do we opt out of Wall Street now? They do not want to be part of big finance practices that keep money out of the economy and place us all in danger of losing our bank deposits if an investment goes badly. Almost all Americans experience the predatory practices that have put the population in debt in order to meet basic needs for housing, education and health care.
This article points to steps you can take in your community now to escape this corrupt system. Previous articles looked at longer-term changes that require government action, such as public banks. In this article, we focus on communities taking action to create alternative currencies and ways they can be integrated into a financial system that connects people with each other, builds dignity and community, and reduces dependence on big finance.
On Clearing the FOG, we spoke with three people who are actively engaged in building alternative economies. Edgar Cahn, author of No More Throw-Away People: The Co-Production Imperative, is founder of the concept of time dollars. Paul Glover created the first local currency based on hours, or labor, in Ithaca, New York. Glover has written many books, including Hometown Money: How to Enrich Your Community with Local Currency. And Jeff Dicken directs Baltimore Green Currency, a local currency backed by federal dollars that has a larger social mission.
All three guests have a vision of a new type of economy that is based on the ideas that all people have talents that contribute to the greater society and that we are mutually interdependent. They see local currencies as a way to build local supply chains and new businesses and services that create sustainable and resilient communities by keeping money circulating in their communities. Local living economies will provide necessary protection when the next economic crash occurs.
Time Dollars Bridge the Two Economies
To fully understand the importance of time dollars, we must first recognize that there are two simultaneous economies: the market economy, in which money is exchanged to purchase goods and services and the non-market economy, which includes all of the activities within families, neighborhoods and communities, in which money is not exchanged. Both economies have a purpose and are necessary for a thriving and healthy society.
Normally, we only study and hear about the market economy. But the needs of a society cannot be met purely within a market economy. The market is based on scarcity: the less there is of something, the more valuable it is. And the market doesn't value family, community and democracy, the things that are needed to create a society in which most of us would want to live. The non-market economy is not included in current economic measures like the Gross Domestic Product (GDP).
At the heart of the concept of time dollars is a restructuring of the operating system on which the economy is based into one that values the non-market economy equally with the market economy. Cahn states that the old operating system (the market economy) "used to work fairly well, but it was subsidized by labor exacted from the subordination of women, the exploitation of minorities, racism, and the exploitation of immigrants." That system has been "bled dry," so it is time to replace it with a system that restores and reinvigorates family, neighborhood and community. Cahn developed the idea for time dollars when he was hospitalized. He was being cared for, but he was not in a position to give anything back and he did not like feeling useless. It was in the 1980s, during a recession with high unemployment and many unmet needs, and the thought occurred to him that others might not like feeling useless either. Most people don't like receiving services without being able to give something in return.
The time dollar system restores dignity and connects people to each other. People identify for themselves what they have to give and what they need. And every person has something to give. It can be running errands, fixing things, providing companionship or services or teaching someone. People earn time dollars for the work they do, and they can use those to purchase the services they need. Time dollars place value on the unpaid work that is done in families and communities. They redefine what we value as work and recognize the value of every person.
A fundamental component of time banks is the idea of co-production, which includes social justice as an integral element. The market economy creates externalities for which it is often not held responsible. The obvious externalities are those due to environmental harm. The market economy also creates social externalities or harm to the non-market economy, to one's ability to do the work that is necessary for family and community. Time dollars are a bridge between the two economies. And co-production means that individuals and communities must be enlisted as co-producers of the outcome and must have access to social infrastructure as well as physical infrastructure. Cahn summarizes, "If you care about justice, democracy and sustainability, you must enlist the community." Co-production is based on five core principles. First is that people of all ages have something to give that is real and that those gifts should be recorded and valued. Second, what is commonly called volunteering should be honored as work. Third is reciprocity, that we give help and receive help. Reciprocity creates the awareness that we need each other and develops a "pay it forward" mentality. Fourth is social capital, which means we must invest in ways to bring people together and embed them in a support group in order to have lasting results. And fifth is respect, that everyone's voice is equal and that there must be ways to know when something is not working.
The time dollar system has evolved into an international movement of time banks in 37 countries. There are 300 time banks in the United States and they have handled millions of time dollars. One program in New York has logged 196,000 hours. Research shows that only 10 percent of participants regularly report their hours and only 25 percent report with some frequency, so the total amount of hours is much higher. The software that helps a community keep track of the time dollars and services, called Community Weaver, is open source and available for free on the Time Bank web site.
When Cahn first discussed the idea of time banks, he was discouraged from going forward for many reasons. There were concerns about the legality and taxation and the effect it would have on society. It is now clear that these concerns were unfounded and that time dollars are a success. They do make a difference in communities. People express trust and hope, and they learn good things about each other, even in places that have a reputation for being dangerous neighborhoods.
Community Currencies Connect
Another type of local monetary system is community or local currency. Local dollars are designed, created and printed and then are used in the community at places of business that agree to accept them. There is a long history of barter-exchanges, on which community currencies build. Paul Glover started the first local currency in the United States, called the Ithaca Hour, in 1991. Ithaca hours are worth one hour of work or ten federal dollars. They come in denominations down to one-eighth hour. At the time they were introduced, they immediately doubled the minimum wage, although some professionals charge more than one Ithaca Hour for an hour of work. They are accepted by 500 businesses within a 20 mile range around Ithaca, New York.
Ithaca Hours are a form of time currency that is backed by both time, or labor, and federal dollars. Some local currencies are backed by only federal dollars, such as the BNote in Baltimore. BNotes are exchanged for federal dollars at a rate of 11 BNotes for ten federal dollars and are then used at hundreds of local businesses which accept them. Thus, an immediate benefit to BNote users is a 10 percent discount on purchases.
Perhaps the most important benefit of local currencies is that they keep money circulating within a community, which has a multiplier effect. Instead of dollars being spent at a store and then being immediately siphoned off to whatever outside corporation owns that store, BNotes stay in the community. Local businesses are more likely to buy the goods and services they need from other local suppliers or businesses.
A study done by Local First of Grand Rapids, Michigan, showed that a 10 percent shift in spending away from chain stores to local businesses "would generate an annual economic impact of nearly $200 million and create 1,300 jobs with over $70 million in payroll." Local currencies are a tool to teach people in the community to use more local independent businesses, which strengthens the community. But they are more than a tool, because local currencies teach that money is really a temporary way to store value between transactions and that a community can decide collectively how they want to handle that storage.
Glover explains that "Ithaca hours connect, while dollars control." Federal dollars are based on debt and an extractive economy. When federal dollars are used, fees and interest go to big finance. Local dollars connect people to local businesses and connect local businesses to each other, thereby building community and the local economy.
The success of local currencies depends on how much they are used in the community and the number and diversity of businesses that accept them. As Glover describes in A Recipe for Successful Community Currency, there must be networkers in the community who recruit businesses, connect them to local suppliers and services, and teach people how to use the dollars and troubleshoot when problems arise. Local currencies are like other cooperative institutions in that they take constant attention to function well.
Building Sustainable and Resilient Communities
Local currencies provide a vehicle to conduct our lives outside of big finance and to strengthen our communities. But the amount of actual economic impact is constrained by the amount of goods and services that can be sourced and produced locally. This is called the Law of Local Currencies: "The degree of economic activity accounted for by a local currency cannot exceed the degree of sufficiency of the community in which it is used."
In order to really opt out of Wall Street, local currencies must stimulate greater local supply chains and be tied into a bigger system of finance. So part of the work of local currencies is to assess what goods and services are purchased or needed in the community and make funds and space available to create those goods and services through independent businesses or worker-owned cooperatives. The goal is to meet more of the communities needs at the local level - that is, to build local, sustainable communities.
The ideal local economy would also have closed feedback loops, meaning that the resources needed to create something were produced locally and the waste from the production and use of that something was recycled in a useful way. This is how a community creates sustainability and resilience in the case of an economic crisis. Local currencies can be used to provide funds to create new businesses and support existing businesses through no-interest micro-credit loans. Glover was able to do that with Ithaca Dollars. Loans without interest were made in amounts of up to $30,000. And Dicken envisions using the federal dollars that are collected through their exchange for BNotes to back a rotating system of credit. In these situations, rather than creating monetary interest, the real interest earned from small loans is the communal interest generated by making the community a better place.
Ultimately, there may be ways to connect communities in a region through local currencies to build more diverse and resilient supply chains. And Glover envisions ways to build a currency backed by labor that can be used nationwide to replace currency based on extraction. In Local Dollars, Local Sense, author Michael Shuman also describes creating regional investment institutions or local stock markets that provide a way to build community and individual wealth outside of Wall Street.
Solidarity Economy
As more people realize that the current debt-based extraction economy serves the interests of big finance at a cost to people and the planet, support for alternative economies is growing. Around the world, the new economy is called a solidarity economy because it is based on cooperation rather than competition. The new economy replenishes and creates abundance rather than destroying and encouraging scarcity.
Money is a concept, a way to store value. It is up to us to decide what we value and how we choose to store it. We can create systems that reduce our dependence on American empire and stop fueling exploitation and wars for resources. We can create systems that value each person and are based on values that rebuild communities, justice, trust and democracy. We can create systems that involve participation by everyone and guarantee that basic needs are met in a way that restores dignity. The need for these systems is great. The opportunity to make them a reality is here. You can listen to Alternative Currencies and Economies with Jeff Dicken, Paul Glover, and Edgar Cahn on Clearing the FOG Radio.
This article was first published on Truthout and any reprint or reproduction on any other website must acknowledge Truthout as the original site of publication.
Remaking the Federal Reserve, Building Public Banks and Opting Out of Wall Street
Wednesday, 17 April 2013 00:00 By Margaret Flowers and Kevin Zeese, Truthout | Op-Ed
http://truth-out.org/opinion/item/15781-remaking-the-federal-reserve-public-banks-and-opting-out-of-wall-street
Creating a Finance System That Serves the People, Part II
In Part I of this series, we examined breaking up the too-big-to-fail-or- jail banks, regulating them - especially their massive and risky derivatives trading - and more aggressively enforcing laws and regulations against security fraud.
In Part II, we examine how to remake the Federal Reserve into a transparent, democratic institution that serves the necessities of the people and the economy, not just the bankers; how to develop public banks in every state and many cities throughout the nation; and how people can opt out of Wall Street right now.
In other articles and on our web site, we examine the broader economy and how to remake it by putting in place economic democracy so that people have greater control over their economic lives and more influence over the direction of the economy.
It is worth restating that we do not see the proposals here as final, but more as an opportunity to continue the discussion so Americans can develop a finance system that serves and protects them.
Transform the Federal Reserve
A fundamental question for the new finance system is the role of the Federal Reserve and whether it should remain in private hands. The Federal Reserve is a privately owned US central bank that acts behind closed doors to create money and set interest rates, and it presently puts the interests of the big banks first. The Federal Reserve was originally created by Congress in 1913 and can be altered, nationalized or even dismantled by Congress.
The Fed is a private entity that is controlled by the banks. The 12 Regional Reserve Banks issue shares of stock to its member banks. The Fed is not operated for profit, and the stock may not be sold, traded or pledged as security for a loan. It does pay dividends that are, by law, 6 percent per year. But more importantly, the stock provides banks with votes to elect six of the nine members of the board of governors of the regional banks.
As Leo Panitch told The Real News Network, it is "not just that the banks are too powerful outside the Treasury and Fed. The Treasury and Fed are part of the Wall Street nexus, and they are organized in such a way, and the people who work in them are trained in such a way, as to be reproducing the current system."
There is widespread agreement among economists that there is a need for a central bank to regulate the money supply by setting interest rates and to be a lender of last resort in a financial crisis. However, Bill Black argues that the Fed can be made very small and mechanical in its setting of interest rates, rather than maintaining the current approach, which depends on what members of the Federal Reserve Board of Governors decide.
Further, the Fed needs to be made utterly transparent. "There is no reason for anything the Fed does to be opaque" says Black. In 2010, an "audit the Fed" bill passed in Congress despite aggressive opposition by the Fed. It was not the broad, open audit originally proposed by former Texas Republican Congressman Ron Paul and Rep. Alan Grayson (D-Florida), but it did provide a snapshot audit of a limited time of Fed activity.
As a result of the Government Accountability Office (GAO) audit of the Fed, Senate sponsor Bernie Sanders of Vermont said, "We now know that the Federal Reserve provided more than $16 trillion in total financial assistance to some of the largest financial institutions and corporations in the United States and throughout the world." Among the investigation's key findings was that the Fed unilaterally provided trillions of dollars in financial assistance to foreign banks and corporations from South Korea to Scotland. These decisions were all made without the public, media or elected officials' knowledge, and they would have remained secret without an audit.
In addition, the audit found conflicts of interest. For example, the CEO of JPMorgan Chase served on the New York Fed's board of directors at the same time that his bank received more than $390 billion in financial assistance from the Fed. Sanders urged that "No one who works for a firm receiving direct financial assistance from the Fed should be allowed to sit on the Fed's board of directors or be employed by the Fed."
But the fundamental question is: who should control the money supply? The control of the money supply may be one of the most important functions of government, but currently it is controlled by the Federal Reserve. The Fed creates funds digitally and makes them available to private banks at a low interest rate, which the banks can then use as they like to invest, add to their personal reserves and/or make loans of up to ten times the amount of their holdings.
At present, the government can only issue bonds that are sold to the Fed, banks or investors with the funds raised by those bond issues used for federal spending. These bonds are loans that must be repaid with interest by the government. So in effect, the government places itself in a position of debt by borrowing money from the banks, and then taxpayer dollars are used to pay the debt with interest. If the government created its own (debt-free) money instead, taxpayers would get more value for their dollars and the system could be more democratic and transparent, and could function for the public good.
Henry Ford said, "It is well enough that people of the nation do not understand our banking and monetary system, for if they did, I believe there would be a revolution before tomorrow morning." Why? Because, as Thomas Edison pointed out, "If our nation can issue a dollar bond, it can issue a dollar bill. The element that makes the bond good, makes the bill good ... It is absurd to say our country can issue $30 million in bonds and not $30 million in currency. Both are promises to pay, but one promise fattens the usurers and the other helps the people."
As part of the economic track of the 2011 Democracy Convention, Greg Coleridge argued that the US Constitution gives the government the power to create money; Article I, Section 8 says: "The Congress shall have power ... to coin money, regulate the value thereof, and of foreign coin." The creation of money is a public function, perhaps more important than any other part of the commons. As Coleridge points out, public money means we create our own money debt-free rather than borrowing from banks and building up debt.
The American Monetary Institute has put forward a thorough model of remaking the finance system to take power from the banks and give it to the people through the government. The institute point to a bill introduced by former Congressman Dennis Kucinich (D-Ohio), HR 2990, which dismantles the Federal Reserve and puts the necessary functions in the Department of Treasury, where a monetary authority is created to prevent inflationary and deflationary impacts. It would prevent banks from creating money through fractional reserve lending. Instead, money would be created by the government, which spends it into circulation for necessary programs - for example, infrastructure, education, health care.
Economist Jack Rasmus also urges that we "democratize" the Fed and require it to function as a national, Bank of North Dakota-like "public banking institution that would provide cost-only loans to the consumer sector (mortgage, auto, student, installment, etcetera), finance public investment corps for alternative energy, lend to community infrastructure projects, and totally remove the private banks from its board of governors and open market committee decision-making process."
Moving the money creation function into the federal government would place it within the US constitutional system of checks and balances to work for the whole society, not only for the bankers and the privileged. Rather than the banker's corporation, the Federal Reserve, creating money, the Fed would be replaced by a US Central Bank operating within the Department of the Treasury (as one option) which would create money.
Further, Coleridge argues, that there is good reason for governments to control the money supply because there are times when more money is needed in the economy and times when the money supply needs be slowed. When money is created by government, it is an asset and not debt to banks. We should be funding necessary projects and paying our debts with debt-free money. Money should be made for the benefit of the entire economy, not for the benefit of bankers.
Under such a system, the creation of money would be used to serve the interests of society. The money would be created and spent into circulation by the federal government for infrastructure, including the human infrastructure of education and health care. For example, the American Society of Civil Engineers grades US infrastructure D+ and sees an urgent need for over $3.6 trillion in spending to bring existing infrastructure to safe levels by 2020. As the federal government spends money on infrastructure and other urgent needs and funds local and state governments, this money is paid out to contractors, who pay their suppliers and laborers, who pay for their living expenses, and, ultimately, that money gets deposited into banks, which are then in a position to make loans.
Some creative thinking is needed to develop a new central banking system. We should open our minds to a wide range of options. For example, in addition to the approach described here, the finance system could be a fourth branch of government, elected directly by the people; or with a combination of elected and appointed governors to represent different parts of society, for example: energy, housing, health care, workers, transportation. The current system is not working and needs rethinking so that it serves the needs of the people and the society, not only the desires of financiers.
Public Banking: A Public Bank in Every State
Ellen Brown, the president of the Public Banking Institute, argues that we need a public bank in every state and major city. The United States has one model for public banking: the bank of North Dakota. When North Dakota farmers were losing farms to Wall Street, they organized a populist movement, and in 1919, set up the bank of North Dakota. The publicly owned bank recycles state revenues into credit for the state. Thus, North Dakotans keep their money in their community.
The result has been an ongoing success. Even during the current economic collapse, North Dakota escaped the credit crisis and has maintained a budget surplus since 2008, low unemployment and no public debt.
Imagine how different California could be if it had public banks. Brown summarizes: "At the end of 2010, it had general obligation and revenue bond debt of $158 billion. Of this, $70 billion, or 44 percent, was owed for interest. If the state had incurred that debt to its own bank - which then returned the profits to the state - California could be $70 billion richer today. Instead of slashing services, selling off public assets, and laying off employees, it could be adding services and repairing its decaying infrastructure."
How does public banking work? All of the revenues of the state go into the state's public bank, which, like other banks, leverages those deposits into credit. The state bank partners with local banks to fund local projects. For example, when there is a flood or other disaster, the bank quickly helps provide funds to rebuild homes and infrastructure. It is a bank focused on serving the public interest and which returns the profits to the public.
According to Brown, there have been two recent studies that show public banks are less corrupt than private banks and that they are more efficient and more profitable. The North Dakota public bank has complete transparency and accountability - including routine audits by several agencies. It does not pay executives exorbitant salaries and bonuses. It does not reward people for churning out risky loans. And it does not engage in casino investing in risky derivatives. It has lower costs because no advertising is necessary; instead, the government guarantees the bank easy access to liquidity.
The most obvious reason for a public bank is to allow a state to use its resources to build the economy of the state by keeping resources in-state and not sending them to Wall Street, but there are other reasons. The events in Cyprus, where depositors were forced to bail out the banks through seizure of their savings, show there needs to be a banking system that protects people. Cyprus-like seizures of accounts can happen in the United States.
In fact, Ellen Brown reports that as part of the "living wills" banks are required to prepare under Dodd-Frank - which describe how they will survive an economic crisis - the banks include "bail-in" provisions. These plans require depositors (who are unsecured creditors, with fewer rights than derivative investors) to bail out the banks by turning their savings into bank stock, which could be worth only pennies on the dollar in a crash.
Marc Armstrong, executive director of the Public Banking Institute, asks of the states: "What is their plan to prevent city, county and state governments from becoming creditors for the too-big-to-fail banks, the next time these banks lose a multi-billion dollar bet? Because of their fiduciary responsibility to the public, we request that our public finance officials answer the question: what is the risk we have in doing business with too-big-to-fail banks that are apparently now able to seize deposits and convert them to capital?"
The living wills of the big banks make them too risky for city, county and state government money, as well as pension funds' money. Another concern is that at least 1,350 school districts and government agencies across the nation have turned to a controversial form of borrowing called capital appreciation bonds to finance major projects. These bonds allow the government to avoid paying anything now and pass the debt on to future generations, but at a much greater cost. For example, $22 million borrowed now with no payments due for 21 years would cost the taxpayers $154 million, seven times the amount borrowed, when it is repaid in 2049.
This practice raises questions. Armstrong summarizes: "Why are state and local governments, school districts and public hospitals paying Wall Street banks billions of dollars of interest on municipal bond and capital appreciation bond debt, when we could be paying that same interest to ourselves by issuing credit with a public bank?" Michael Hudson, a former Wall Street economist, sees the private banking system as cannibalizing the economy and supports public banks to fund the needs of the nation. When the banks failed, the FDIC should have taken them over, essentially made them into public banks, says Hudson:
If the government would have taken over Citibank it would not have done the kind of things that Citibank did. The government would not have used depositors' money and borrowed money to gamble. It wouldn't have gone down the casino capitalism route. It wouldn't have played the derivatives market. It wouldn't have made corporate takeover loans. None of these are productive from the vantage point of economic growth and raising productive powers and living standards. They would not be the proper behavior of a public bank.
Hudson points to the differences between public and private banking. Private "[b]anks are supposed to make money. And unfortunately, they can make money most easily ... by being parasitic, not by being productive." On the other hand, a public bank "would make loans for long-term purposes to serve the economy and help the economy grow."
With the risks of Wall Street banks increasing and dislike of their banking practices mounting, the public banking movement is growing. It is also being spurred by the US Treasury Department and the Federal Reserve's refusal to assist states with their budget problems. Brown reports that 20 states are considering public banks, as are a growing number of cities. Brown says, "We need to get more information out there and develop a groundswell of popular support. Populist movements start with a lot of study, learning about the monetary system." One place to do that is at the June 2-4 public banking conference in California.
Brown would like to see states remove the middleman, the private banks that profit from their deposits, by creating a public bank in every state so states could "bring their money back home and leverage it for their own purposes." There is no good reason for states and cities not to develop public banks and many good reasons to do so.
Change Is Already Happening as People Opt Out of Wall Street
There are a variety of vehicles being developed to help people move their money out of Wall Street banks and the current finance system. The Move Your Money Project encouraged people to move their money from the big banks to community banks and credit unions. The Occupy movement held a Bank Transfer Day on November 5, 2011, as part of this campaign. The campaign was assisted by banks whose corrupt practices became notorious and who had started adding fees, like ATM card fees. Three months after Bank Transfer Day, more than 5.6 million customers had moved their money. The campaign continues at Switch Your Banks, which has a consistently excellent blog on banking. Credit unions, a form of cooperative finance, now have assets of over $1 trillion and are becoming major financial players.
People have also been creating time dollars and time banks. This concept, originated by Edgar S. Cahn, allows people to give time to get time; that is, if someone takes an hour to teach someone to read, they can get an hour for a massage from someone else participating in the time bank, and the masseuse can get an hour from a local participating plumber. This work is conducted outside of the tax system and allows people who have skills, but perhaps are unemployed or underemployed, to use their skills in a dignified way to purchase the skills of other people. TimeBanks.org provides a directory of Time Banks in the United States. If you cannot find one in your community, you can create a time bank.
Another opt-out is local currency. Across the world, 1,900 local communities, including over a hundred in the United States, are now issuing their own currency. Some communities, such as Ithaca, New York, issue paper currency; others in Canada, Australia, the UK or France issue complementary electronic money.
The new Internet currency, Bitcoin, has become popular very quickly. Bitcoin is already bigger than many sovereign currencies and this month broke the $1 billion value mark. Bitcoin is not tied to any particular financial institution and is independent from world governments. Some view Bitcoin as a safe haven for people trying to protect their money from corrupt Wall Street banking, but large investors have begun buying up Bitcoin to avoid taxes. The outcome is uncertain at this time.
More and more questioning has arisen regarding the current debt-based finance system. Occupy Wall Street offshoot Strike Debt is building popular resistance to all forms of debt imposed on us by the banks. They produced the Debt Resistor's Operations Manual, which provides specific information and tactics for understanding and fighting against the debt system. It provides information on how to deal with personal debt, as well as how to work collectively to challenge the way debt undermines communities. Strike Debt also organized a Rolling Jubilee where participants buy debt at pennies on the dollar, as debt collectors do, but rather than collecting the debt, they forgive it. So far, they have raised over $578,000 to abolish over $11.5 million in debt.
People are also examining ways to invest locally rather than on Wall Street. Michael Shuman, in Local Dollars, Local Sense points out that Americans have $30 trillion invested in stocks, bonds, mutual funds, pension funds and life insurance funds, but not even 1 percent of these savings touch local small business. He shows how people can profit by putting money into building their local businesses and creating resilient local and regional economies. Shuman describes many ways to opt out of Wall Street and opt in to local investment, among them investment clubs and networks, local investment funds, community ownership, direct public offerings, local stock exchanges and crowd funding.
Tying It All Together
In his current book, What Then Must We Do?, political economist Gar Alperovitz argues that banking is one of two major areas where game-changing, systemic change might develop (the other is health care). As the Wall Street finance system fails us and places us at great financial risk, people are looking for alternatives and thinking about ways to create a finance system that will serve the people. A lot has been done in this area, and a cohesive set of principles is beginning to be developed. These include:
•Investigation and enforcement of the finance system.
•Breaking up the big banks and limiting their size so they are not a systemic risk.
•Remaking the Fed into a small, transparent, mechanical controller of interest rates.
•Transferring the power to create money to the government in a new central bank.
•Creating public banks in cities and states throughout the country.
•Creating systems outside of the finance system that allow for barter, time banks and other alternatives.
•Encouraging community banks and credit unions.
•Encouraging local investment in communities instead of Wall Street investment.
This article does not attempt to cover all aspects of finance. For example, the international systems dominated by the World Bank and International Monetary Fund require major transformation, but that topic would require an article of equal length. We also do not deal with the economy beyond finance, where we see worker-self-directed enterprises or worker cooperatives as the foundation of a new democratic economy that spreads wealth and power more equitably among the people and where a progressive tax system would fund the government.
Finance is the center of the US economy. The current system does not function for most people - or for small- and medium-sized businesses. It is a system that is addicted to casino-like investment, is corrupted by unprosecuted security fraud and funnels money to the wealthiest.
The 2008 collapse had devastating consequences, and since the system remains quite opaque, we do not know whether another collapse is near. It is time to develop an alternative system of finance designed to support the needs of the people and the country, not the needs of bankers. We hope this article adds to an ongoing conversation, and we look forward to your comments so the conversation can be advanced further.
You can listen to Big Finance Fraud and Public Banks with Bill Black and Ellen Brown on Clearing the FOG Radio.
This article was first published on Truthout and any reprint or reproduction on any other website must acknowledge Truthout as the original site of publication.
North Dakota’s Economic “Miracle”—It’s Not Oil
North Dakota has had the nation’s lowest unemployment ever since the economy tanked. What’s its secret?
http://occupywallst.org/forum/why-is-socialism-doing-so-darn-well-in-deep-red-no/#comment-960075
Empowered by the Past: Red State Co-ops Go Green
Friday, 05 April 2013 09:22 By Brooke Jarvis, Yes! Magazine | Report
http://truth-out.org/news/item/15552-empowered-by-the-past-red-state-co-ops-go-green
A century ago, cooperatives electrified the poorest counties in the nation. Today, can they lead the way to a smarter, cleaner grid?
Charles Cotton never gave much thought to the fact that he owns a piece of Jackson Energy Cooperative, the utility that delivers power to his home in Berea, Ky. His grandparents used to go every year to the co-op’s annual meeting and cook-out, where member-owners elect representatives and vote on cooperative business, but Cotton himself has never gone. He uses Jackson Energy simply because it’s the only utility serving his region.
But last November, Cotton’s membership paid off in a way he hadn’t expected: The cooperative gave him an energy upgrade, installing a plastic moisture barrier underneath his house and replacing his old furnace with an efficient heat pump. Cotton’s home now feels warmer and his electric bills have dropped significantly, but he never paid a dime up front.
Jackson Energy’s status as a cooperative led directly to Cotton’s retrofit. It is one of four rural electric cooperatives participating in a pilot program called How$martKY, run by the Mountain Association for Community Economic Development (MACED). The program will let Cotton slowly pay back the cost of the retrofit: His bill is smaller than before, but he’s actually paying a bit more than the cost of the electricity he uses. The extra charge is how he repays the cost of the retrofit. It’s a scheme called on-bill financing—a way for people of all financial backgrounds to reap the benefits of energy efficiency without a big up-front cost.
Since on-bill programs like How$martKY are still experimental, MACED made a point of kicking off its pilot program by working with cooperatives. Investor-owned utilities are legally required to prioritize shareholder profits, and often can’t take on risky or unproven ventures. But electric cooperatives are required to maximize value for their members. That makes a cooperative potentially more willing to try out a program with an as-yet-unproven effect on the utility’s bottom line, but with the immediate potential to help member-owners and wean the region off fossil fuels. “Because they’re customer-owned, because they’re intent on customer satisfaction, it made sense to start with them,” says Justin Maxson, president of MACED. The program is a small step forward in a region of the country underserved by renewables, but one with the potential to grow. “What we love is that it has a shot to make energy efficiency much more scalable,” says Maxson. “That’s especially important in Appalachia, where we’re so over-dependent on coal as our primary source of energy.”
Most of the nation’s electric cooperatives were founded on the idea that small steps can beget big change. Many such cooperatives date back to the 1930s (Jackson Energy started in 1938), when the electricity divide in the United States was stark: Approximately 90 percent of urban homes had power, and 90 percent of rural homes did not. For-profit utilities had little interest in building transmission lines in sparsely populated areas, so the federal government offered loans and encouraged farmers and ranchers to set up their own electric cooperatives. By the mid- ’40s, some 50 percent of rural Americans had electricity; by the mid-’50s, the vast majority did. Now cooperatives form the largest electric utility network in the nation, serve some 42 million people in 47 states, generate $45 billion in annual revenue, and employ nearly 130,000 people. Approximately 78 percent of U.S. counties are served by electric cooperatives. Clean-energy advocates hope that network can be harnessed to bring big changes once again to America’s energy landscape.
A transformative influence?
Co-op electricity, like that of the nation as a whole, comes from a mix of sources that varies by region—and because of cooperatives’ strong presence in coal-producing regions, their reliance on coal-fired power is higher than the national average. Still, 90 percent of electric cooperatives have at least some renewable power in their portfolios, and 96 percent offer some sort of energy efficiency program. As of 2007, co-ops got 3 percent more of their energy from renewable sources than did the nation’s utility sector as a whole. Cooperatives around the country are pushing to do better. In 2008, a number of them banded together to form the National Renewables Cooperative Organization, an umbrella group that supports local co-ops in making the switch to renewable energy. The organization found that renewables make sense for cooperatives for more than environmental reasons. Diverse power sources can insulate members from volatile prices, and renewable energy projects can create jobs in the communities where members live.
In Tennessee, a cooperative is offering members direct stakes in a new solar farm. A Montana cooperative helped a city in its coverage area rebuild a failing hydroelectric plant. In Minnesota, an electric co-op is researching ways to combine hydro and wind power to achieve a more stable power supply. An Indiana co-op is operating 14 landfill gas-to-energy plants. A cooperative in Hawai‘i, which was set up 11 years ago when the petroleum-powered, for-profit utility went up for sale, is planning to provide 50 percent of its power from renewable sources within the next 10 years.
Co-ops find many reasons to pursue energy efficiency—as in South Carolina, where the energy demands of a quickly growing population threatened to overload the grid. Reluctant to take on the cost of building new nuclear or natural gas plants, a group of cooperatives created an on-bill financing pilot program similar to How$martKY. Since South Carolina has the nation’s highest percentage of manufactured homes (which, on average, use far more energy per square foot than traditional homes), efficiency is an easy target. Eventually, the co-ops hope to retrofit more than 200,000 homes, saving customers $280 million a year.
Electric co-ops are also pushing forward with “smart grid” upgrades—advanced technologies that increase efficiency, reliability, and the integration of new power sources. A consortium of cooperatives won a $68 million stimulus grant to test how in-home displays of energy consumption change consumer behavior and improve efficiency. Other co-ops have pursued similar projects on their own. In 2012, the Federal Energy Regulatory Commission found that cooperatives lead the industry when it comes to the adoption of advanced metering systems. These let customers know how much energy they’re using, so they can scale back, and how strained the grid is, so they can save money by waiting until off-peak hours to use energy-intensive appliances.
Innovations adopted by cooperatives can quickly ripple out into the broader industry. Unlike for-profit utilities, which tend to be proprietary with their information, cooperatives make a point of collaborating. “While the co-ops are very much independent of each other in terms of the ultimate decision that gets made in the boardroom, there’s a lot of collaborative work that goes on,” says Martin Lowery, a vice president of the National Rural Electric Cooperative Association, which provides support services to about 1,000 electric cooperatives across the nation.
It’s a potentially powerful mix of local accountability and national connectivity. For example, Alaska’s Kotzebue Electric Association, located north of the Arctic Circle, is developing both wind and solar thermal generation projects in an effort to move away from expensive diesel fuel. As a result, cooperatives around the nation can learn from Kotzebue’s findings on battery storage in extreme conditions.
Beyond utilities
Some cooperatives have green energy written into their missions. Kaua‘i Island Utility Cooperative, for example, describes itself as “committed to reinventing how Kaua‘i is powered.” But many other co-ops would not go so far. Their goal is to provide reliable, low-cost energy to their members—whatever the source. Just like their investor-owned counterparts, many electric cooperatives have opposed environmental regulations, including the EPA’s decision to regulate greenhouse gases as pollutants. The choices of electric co-ops depend on their members: Renewables and energy efficiency are only a priority if members want them.
Still, the fact that so much of the nation runs on electricity that’s cooperatively managed represents a significant opportunity—particularly since many rural areas have lagged behind in efficiency and renewable power. Cooperatives have “a diverse infrastructure that’s hard to paint with one brush,” says Maxson. “But [they have] the potential to be a powerful point of leverage in supporting energy efficiency and economic opportunity in rural communities.”
Lowery also believes cooperatives can spur deeper conversations among members about their values and their communities. That, after all, is the real difference between cooperative utilities and those owned by stockholders. Value to stockholders is narrowly defined: It means “profit.” But the members of electric cooperatives have the possibility of defining value in their own terms.
As members learn to recognize and utilize that power, Lowery envisions a much stronger push toward more sustainable energy. But he doesn’t stop there. His long-term goal is for members to use their cooperatives to solve problems that go beyond energy.
“It’s about being a facilitator, a catalyst for a dialogue about what’s going to be needed for a healthy and sustainable community in the future. That could mean responding to the needs of aging populations in rural America, the need for healthcare and broadband services, water quality and availability, educational opportunities for kids,” said Lowery.
“Electricity is a means to an end. We’re not utilities. We never were utilities. We’re there to meet the needs of communities and thereby improve their quality of life.”
This piece was reprinted by Truthout with permission or license.
Mr. President, you have been so correct in resisting attempts to balance the budget by increasing taxes. The tax load on the average American family is already at counterproductive levels with the underground economy having now grown to an estimated $500 billion per year, costing about $100 billion in lost Federal tax revenues per year.
The size of the underground economy is understandable when one considers that median family income taxes have increased from $9 in 1948 to $2,218 in 1983, or by 246 times. This is runaway taxation at its worst.
Importantly, any meaningful increases in taxes from personal income would have to come from lower and middle income families, as 90 percent of all personal taxable income is generated below the taxable income level of $35,000.
Further, there isn't much more that can be extracted from high income brackets. If the Government took 100 percent of all taxable income beyond the $75,000 tax bracket not already taxed, it would get only $17 billion, and this confiscation, which would destroy productive enterprise, would only be sufficient to run the Government for seven days.
Resistance to additional income taxes would be even more widespread if people were aware that:
One-third of all their taxes is consumed by waste and inefficiency in the Federal Government as we identified in our survey.
Another one-third of all their taxes escapes collection from others as the underground economy blossoms in direct proportion to tax increases and places even more pressure on law abiding taxpayers, promoting still more underground economy-a vicious cycle that must be broken.
With two-thirds of everyone's personal income taxes wasted or not collected, 100 percent of what is collected is absorbed solely by interest on the Federal debt and by Federal Government contributions to transfer payments. In other words, all individual income tax revenues are gone before one nickel is spent on the services which taxpayers expect from their Government.
Grace Commission Report
January 12, 1984
.
.
"Pay Any F.R.B. Branch or Gen. Depositary for Credit U.S. Treas. This is in Payment of U.S. Oblig.;"
(IRS endorsement stamp)
Your siting a study that is quarter century old? LOL. You compare taxes paid in 1948, and 1983? Does the annual income, inflation, matter at all.? Ridiculous. You wanna capture black market economy taxes? legalize drugs. Let people decide for themselves instead of the costly "war on drugs" that targets minorities. Your screed appears to claim we can't take anymore taxes from the poor 1%. Well guess what? That's BS! The 1% crashed the world economy (and still benefit) The 1% created this "great recession" and have enriched themselves while the 99% have suffered and sacrificed. They should be made to pay. To sacrifice! To suffer! They should be prosecuted for their crimes and have the money they stole returned to the people!. Now thats from 2012! Not 1984. What a joke! LMFAO
The joke is your inability to read the thread of posts I've made over the past week showing the consistent presence of a monied aristocracy (as Jefferson put it) confirmed by presidents and even the father of the Federal Reserve Act. Even in my latest post, you've failed to comprehend the fact that it shows people's tax dollars going straight to the bankers, not to the government, and that even 90% of this comes from people making under $35,000 even though the income tax was originally enacted to only tax the 1% and didn't apply to other Americans until their war time Victory Tax was converted into a tax for the general population.
Blah! Blah! Blah!...................1984???....................................................... You wanna capture black market economy taxes? legalize drugs. Let people decide for themselves instead of the costly "war on drugs" that targets minorities. Your screed appears to claim we can't take anymore taxes from the poor 1%. Well guess what? That's BS! The 1% crashed the world economy (and still benefit) The 1% created this "great recession" and have enriched themselves while the 99% have suffered and sacrificed. They should be made to pay. To sacrifice! To suffer! They should be prosecuted for their crimes and have the money they stole returned to the people!. Now thats from 2012! Not 1984. What a joke! LMFAO
And the joke that you reveal yourself to be continues to grow.
Yeah. What about legalizing drugs? For or against? What about prosecuting the 1% fin criminals? For or against.? Speak up! Take a stand. Stop hiding behind insults and old numbers!
What about reading the very first clause of the Free Democracy Amendment? For or against? C'mon, stand up and stop hiding behind ignorance and at least pretend that you know how to read.
You ain't my teacher handing out reading assignments. If you can't discuss your 1st clause then I guess it ain't worth it. Probably more out of date "protect the wealthy taxpayer" propaganda. Why would I waste my time with readings from someone who wants to protect the poor wealthy tax payer? I'm smarter than that. and I think I'm smarter than you.
And yet your replies consistently prove that you're not. Reading comprehension is obviously not your thing. There are no teachers, only students. Those who are unwilling to learn are in no position for carrying on worthwhile discussions.
And again you avoid taking a stand on any issues. Only insults. Concerned about lost taxes from black market? legalize drugs! Yes?, no? Are you willing to go after the money stolen by the 1%? Prosecute the 1% fin criminals? Yes? No?
A stand has already been taken but your lack of reading comprehension prevents you from observing it. Will you finally learn to read or will you continue chasing your tail with questions answered long before they were ever asked? Yes? No?
( http://occupywallst.org/forum/political-organization-rather-than-political-party/#comment-763942 )
You have not answered! Are you mentally retarded.? I just got here boss. What are you afraid of. You can't have a conversation. You have to refer back to previous posts. Don't be silly. You can't answer because I guess we disagree. Whatever. Lotsa people disagree. I disagree with you that we should protect the poor wealthy 1% from tax increases. No big deal. It happens. You don't have to discuss anything. You are dismissed. On your way.
You can't have disagreements where there is no comprehension. All you can have are baseless accusations while grasping at the wind.
I'm not grasping. I'm simply asking about your beliefs. You are refusing to discuss. Why? IDK. I suppose it could be you just can't back up your arguments. Either they are too weak, or because you don't have the mental capacity. In any event I can't make you discuss anything and there are plenty of people to discuss important issues with on this site. So again. You are dismissed. On your way.
And just what arguments of mine would those be? You see, you are grasping. When you respond to a post with baseless accusations due to a lack of reading comprehension, you're not asking about beliefs, you're simply blowing misdirected hot air. And when you refuse to correct your error of not seeking comprehension of all that is before you, you consistently dismiss yourself from any meaningful discussion. So, you can continue declarations of dismissals over and over again but it only continues to confirm your own ongoing dismissal.
Meaningless. Useless. No substance. Just schoolyard insults. You are still dismissed.
And you're still grasping at the wind.
King Herod: Jesus Christ Superstar
and learn to write
I think I like it.
"all experience hath shewn, that mankind are more disposed to suffer, while evils are sufferable, than to right themselves by abolishing the forms to which they are accustomed." -Declaration of Independence
"Liberty means responsibility. That is why most men dread it." -George Bernard Shaw
Congressmen Pocan and Ellison Introduce "Right to Vote" Constitutional Amendment
Saturday, 18 May 2013 11:25 By Brendan Fischer, PRWatch | Report
http://truth-out.org/news/item/16450-congressmen-pocan-and-ellison-introduce-right-to-vote-constitutional-amendment
"The right of voting for representatives is the primary right by which other rights are protected," wrote Thomas Paine in 1795.
Yet contrary to popular belief, there is no affirmative right to vote in the U.S. Constitution. This gap in our founding document has provided an opening for the wave of voter suppression measures that swept the country in recent years, and before that, the poll taxes and Jim Crow restrictions that disenfranchised millions. This week, two Congressmen -- both from states at the epicenter of today's voting rights struggles -- are seeking to fix that.
“The right to vote is too important to be left unprotected,” said Rep. Mark Pocan of Wisconsin, who is co-sponsoring an amendment to the U.S. Constitution guaranteeing the right to vote.
“Even though the right to vote is the most-mentioned right in the Constitution," added Minnesota Rep. Keith Ellison, the bill's other sponsor, "legislatures across the country have been trying to deny that right to millions of Americans, including in my home state of Minnesota. It’s time we made it clear once and for all: every citizen in the United States has a fundamental right to vote.”
U.S. Constitution Does Not Protect Voting Rights
Under the U.S. Constitution, the Fourteenth and Fifteenth Amendments ensure the vote cannot be denied on the basis of race, the Nineteenth prohibits discrimination based on gender, the Twenty-fourth outlaws the poll tax, and the Twenty-sixth Amendment extends voting to age 18. When the U.S. Constitution was ratified, the franchise was limited to white, property-owning men, and these amendments have edged the document closer to its democratic aspirations.
But beyond those amendments -- and a few federal statutes, like the Voting Rights Act of 1965, which might be neutered by the Supreme Court this term -- the right to vote is mostly a matter of state law. And states in recent years have hardly been careful about protecting access to the ballot box.
After Republicans gained new statehouse majorities in the 2010 elections, a majority of states introduced proposals to enact restrictions on the right to vote. According to the Brennan Center for Justice, 25 laws and 2 executive actions passed in 19 states between 2011 and 2012 to impose strict ID restrictions, or shorten early voting, or limit registration drives, among other measures. More restrictive bills have been proposed in 2013.
Wisconsin's Constitution Includes Express Voting Protections
Pocan's state, Wisconsin, passed one of the strictest voter ID laws in the country in 2011 after Governor Scott Walker and a GOP-dominated legislature took power. The law threatened to disenfranchise more than 300,000 voters who did not have the required forms of ID, primarily people of color, students, and the elderly. (Like many of the restrictive voter ID laws proposed since 2011, the bill tracked a "model" Voter ID Act from the American Legislative Exchange Council). But just months after Wisconsin's law was enacted, a state court struck down the law based on the Wisconsin Constitution's protections for voting rights.
"Every United States citizen age 18 or older who is a resident of an election district in this state is a qualified elector of that district," the Wisconsin Constitution reads.
Four years earlier, in 2008, the U.S. Supreme Court found that Indiana's relatively similar voter ID law did not violate the U.S. Constitution -- which unlike the Wisconsin Constitution, does not expressly safeguard the right to vote.
Pocan and Ellison are seeking to ensure that citizens across the country can share the voting rights protections that have (so far) been enjoyed by Wisconsin residents.
Pocan: "Our country is at its strongest when everyone participates" The Pocan/Ellison proposal, if approved by Congress and ratified by two-thirds of state legislatures, would affirmatively guarantee the right to vote, prohibiting not only restrictive ID measures, but also new limits on early voting, and measures to crack down on registration drives or same day registration, and other voter suppression efforts.
The proposed amendment language is simple, yet broad:
SECTION 1: Every citizen of the United States, who is of legal voting age, shall have the fundamental right to vote in any public election held in the jurisdiction in which the citizen resides.
SECTION 2: Congress shall have the power to enforce and implement this article by appropriate legislation.
“At a time when there are far too many efforts to disenfranchise Americans, a voting rights amendment would positively affirm our founding principle that our country is at its strongest when everyone participates," Pocan said Monday at a press conference in the Wisconsin Capital.
"As the world’s leading democracy, we must demand of ourselves what we demand of others—a guaranteed right to vote for all.”
This piece was reprinted by Truthout with permission or license.
Everyday Socialism, American-Style, Is Happening Now
Tuesday, 14 May 2013 10:44 By Gar Alperovitz, Chelsea Green Publishing | Book Excerpt
http://truth-out.org/news/item/16353-everyday-socialism-american-style-is-happening-now
Gar Alperovitz is the Lionel R. Bauman Professor of Political Economy at the University of Maryland. He is best known for articles, books and speeches about the development of an alternative cooperative/publicly owned segment of the economy in the United States.
Alperovitz's latest book is What Then Must We Do? Straight Talk About the Next American Revolution.
"Gar Alperovitz's new book develops a brilliant strategy for the type of transformative change that can lead America from decline to rebirth," writes James Gustave Speth, author of America the Possible.
Support Truthout's mission. Gar Alperotivz's new book, What Then Must We Do: Straight Talk About the American Revolution, is yours with a minimum donation to Truthout of $25, or a monthly donation of $15.
Chapter 11 of What Then Must We Do?
One more obvious step, for the moment, in connection with real-world democratization (and maybe also about what can be done if you want to start getting serious).
I assume you are aware that socialism—real socialism, not the fuzzy kind conservatives try to pin on Barack Obama—is as common as grass (well, maybe not that common, but still very common indeed) in the United States.
I'm not talking about the public programs that come to many minds when socialism is discussed in an American context. These programs often help people in need and do many other useful things, but they don't attempt to change the underlying systemic design and the political power it confers on corporate actors.
I'm talking about the (efficient) government ownership of businesses, some set up in the past and still working very nicely, thank you, and many new efforts now also flourishing big-time.
For a start: It's often forgotten—or simply not known—that there are more than two thousand publicly owned electric utilities now operating, day by day, week by week, throughout the United States (many in the conservative South). Indeed, 25 percent of US electricity is supplied by locally owned public utilities and co-ops. Moreover, most of these now conventional "socialist" operations have a demonstrated capacity to provide electricity at lower cost to the consumer, not to mention cheaper and more accessible broadband. (Nationally, on average, customers of private utilities pay 14 percent more than customers of public utilities.)
One obvious reason: Public utilities and co-ops simply don't pay the same exorbitant executive salaries common in the private sector. They get pretty much the same work done for far less. General managers of the largest class of publicly owned power companies earned an average salary of roughly $260,000 in 2011. Average compensation for CEOs of large investor-owned utilities was $6 million—almost twenty-five times as much.
Also, of course, public utilities and co-op producers don't have to pay private shareholders any dividends. And they return a portion of their revenues to the city or county to help supplement local budgets, easing the pressure on taxpayers. A recent study found an average transfer of 5.2 percent of revenues to municipalities—compared with average tax payments by private-investor-owned utilities of 3.9 percent.
In smaller communities revenues from public utilities are often a crucial component of city budgets. In Ashland, Oregon, for instance, fully 30 percent of the general fund that pays for such services as police, fire, and street maintenance comes from public utility profits; only 16 percent comes from property taxes. Similarly, the century-old public utility in Norwich, Connecticut, is a major contributor to the city, with more than 10 percent of its total billings—more than 5 percent of the city's total annual budget—going to the municipal general fund.
A number of public utilities also play a powerful role in building a green economy. In California the Sacramento Municipal Utility District (SMUD)—one of the ten largest public utilities in the United States—now supplies more than 24 percent of its retail energy sales from renewable sources; it expects to reach a goal of 37 percent renewable energy by 2020. SMUD is also on target to slash CO2 emissions to just 10 percent of 1990 levels by 2050.
Another leader, Austin Energy in Texas, runs the most successful utility-sponsored green energy marketing program in the country. Approximately 15 to 17 percent of its power currently comes from renewable sources—primarily wind, with landfill methane gas a distant second. The utility expects to reach 30 to 35 percent renewable energy by 2020. It also has a twenty-year agreement to purchase power from a large wood-fired power plant in East Texas, and it expects to achieve a CO2 reduction goal of 20 percent below 2005 levels by 2020.
A number of cities are now also regularly involved in the public land development business—increasingly in situations where public policies, such as those involving mass transit, create huge land value increases and other benefits that would otherwise simply go to private developers.
Boston was one of the first to realize this possibility. In 1970 the city embarked on a joint venture with the Rouse Company to develop historic eighteenth-century Faneuil Hall Marketplace (a six-and-a-half-acre downtown retail complex with forty-nine shops, eighteen restaurants and pubs, twenty-five eateries, and forty-four carts). Boston kept the property under municipal ownership and negotiated a lease agreement in which the city got a portion of the development's profits in lieu of property taxes. By the mid-1980s Boston was collecting some $2.5 million per year from the marketplace, and by 2008 this had increased to several million a year. One expert estimate is that the approach allowed the city to take in "40 percent more [revenue] than it would have collected through conventional property tax channels."
Some of the most interesting examples of what might be called "development socialism" occur when a city develops and leases land it owns in and around entrances to publicly funded mass transportation subways and light rail systems. Land values go up dramatically at such locations, and cities used to simply let developers grab the publicly created opportunities—and then try to tax back whatever they could. Now many cities routinely maintain public ownership of the land, directly capturing the increased values the public investment creates.
In Miami, Florida Miami-Dade Transit is involved in the ownership of multiple large transit-linked joint development ventures. Dadeland South Station, for instance, includes multiple office buildings, a luxury hotel, and ground-level retail space. Dadeland North Station comprises more than 370,000 square feet of retail space, a large residential rental building, and a luxury apartment building. Taken together the projects generate annual revenues of around $1.3 million for Miami-Dade County.
The San Francisco Bay Area Rapid Transit (BART) has eighteen transit-oriented development projects under way (and numerous others in various stages of development). In the nation's capital, the Washington Metropolitan Area Transit Authority has established more than fifty revenue-generating joint development projects. The Valley Transportation Authority of Santa Clara County, California, has designed its Transit-Oriented Development Program to encourage mixed-use development within two thousand feet of transit stops. Not only does its Almaden Lake Village Project return revenues to the city, but 20 percent of the 250 residential units are offered at below-market cost to low-income households.
I mentioned at the outset that many utilities now help create broadband services. This is another area where public enterprise has become increasingly common, both via utility-based strategies and through other independent municipal efforts. More than 130 cities have built citywide public Internet networks. Hundreds have partial networks (connecting schools, businesses, and government buildings), and hundreds more are actively planning the construction of such networks.
Many others have made Internet provision a priority and are investing in telecommunications, including cable television, high-speed Internet services, local and long-distance telephone service, fiber leasing, and wireless data transmission. Indeed, by 2007 over seven hundred public power companies—or more than a third of them—were offering some form of advanced telecommunication services.
OptiNet, the broadband division of the city-owned utility in Bristol, Virginia (BVU), was the first utility in the nation to provide voice, video, and broadband over a fiber-to-the-user network. By early 2012 OptiNet had achieved approximately 70 percent market penetration in its primary service area (city limits of Bristol, Virginia) and had reached 53 percent of total homes and businesses in more recent expansion (counties surrounding Bristol served by BVU). In 2010 and 2012 OptiNet increased Internet speeds without raising prices and now provides connections that can be faster than those of many large cable companies.
Chattanooga, Tennessee, offers the fastest citywide fiber network in the country (up to 1 Gbps) for prices that are often eight to ten times cheaper than in neighboring locales served by Comcast and AT&T. As a result, several companies have relocated their operations and jobs to Chattanooga. The city's network was also influential in convincing Amazon to expand its massive distribution center in the city.
Here, for the record, are a few more illustrations of conventional "socialism" in action.
Many cities are involved in hotel construction and ownership—and making profits on these efforts. City-owned hotels can be found in communities as different as Austin, Houston, Chicago, Omaha, Overland Park (Kansas), Sacramento, Marietta (Georgia), Oceanside (California), Myrtle Beach (South Carolina), Denver, Phoenix, and Vancouver, Washington (near Portland, Oregon). To take just one example from a seemingly conservative area: In May 2008, the Dallas City Council, led by mayor Tom Leppert, voted by an 11–2 margin to pursue construction and operation of a publicly owned convention center hotel. A charter amendment that would have stopped the effort was defeated in a public referendum, and in November 2011 the city celebrated the grand opening of its convention-oriented city-owned $500 million, 1.2-million-square-foot, twenty-three-story, 1,001-room hotel.
Cities are also involved in one or another form of hospital ownership, with a recent survey (2010) finding that roughly one-fifth of hospitals in the United States are publicly owned. One of the most interesting is Denver Health. Once an insolvent city agency ($39 million in debt in 1992), Denver Health is now a competitive health care system structured as an innovative blend of democratized ownership and direct municipal accountability. As a quasi-governmental agency it now has relative autonomy over decisions, yet it is subject to the state's open-meetings law (allowing for public involvement) and has a board that is appointed by the city's mayor.
Denver Health operates a highly efficient system that includes eight primary care centers and thirteen school-based clinics. An award-winning leader in its field, and consistently profitable for more than two decades, it employs roughly fifty-six hundred Denver-area residents and treats more than a third of Denver's population, including a full 37 percent of the city's children. About 65 percent of the patients are ethnic minorities, and more than 40 percent are uninsured.
One of the most interesting developments—now to be found in nearly seven hundred local projects—involves green operations that capture methane and turn it into fuel to produce electricity (and make money for the city). Here for instance is how Riverview, Michigan, does it—using a formula to be found in one form or another in many other cities.
Riverview teamed up with Detroit Edison (the local public utility) and a private corporation, Landfill Energy Systems, to develop a landfill gas-to-energy project on its 178-acre landfill. The project captures 4.3 million cubic feet of landfill gas per day and in turn uses it to provide electricity for over five thousand homes—in the process generating more than $150,000 a year in royalty income to help fund needed public services. The carbon emissions impact is also significant: The utility estimates the conversion operation removes the equivalent of the emissions produced by almost fifty thousand passenger vehicles each year.
A variation on the same theme is a wastewater-to-energy facility at California's Point Loma Treatment Plant, which serves a 450-square-mile area near San Diego. The methane produced through the treatment process there generates electricity for process pumps, lights, and computers. Since 2000, San Diego has saved around $3 million annually in energy costs through the operations of the facility. You didn't know about such things?
Most people don't, and the decaying American press isn't much help. Also, "the other side" doesn't have any interest at all in letting you know what can be done. Indeed, what is being done all the time in the way of large-scale democratization throughout the country, even (if you like) "socialism," American-style.
(That is one of the best reasons, by the way, to get serious about digging deeply. There are lots more practical precedents out there to build on if somebody does the work of finding out about—and refining and adapting—things that work for current and future use and, above all, moving the process beyond partial experiments to ever greater publicly benefitting democratization over time.) We've just looked at the tip of the iceberg here. Many interesting things are also happening at the state level.
In California, CalPERS (the state pension fund, now in operation for eighty years) oversees $237 billion in investments. Even factoring in the negative effects of the financial crisis and recession, the market value of its portfolio has risen 52 percent in the past ten years. Not only is CalPERS one of the largest investors in the state of California, it has taken a lead in directing a share of its investments to community-building efforts in the state (rather than handing over all state pension asset investments to Wall Street and other financial advisers and investment firms). (We're not talking small potatoes here: Such state investments totaled $23.5 billion as of September 2012.
In Alabama the public pension system—Retirement Systems of Alabama (RSA)—invests in numerous local Alabama industries, in many cases also helping create worker-owned firms. Investments range from aerospace to tourism development and include, among others, Navistar International—a firm that paid its engine manufacturing plant employees to work in the community rather than lay them off when the recession caused a drop in production.
In Alaska, the Alaska Permanent Fund invests oil revenues on behalf of citizens of the state. Earnings provide annual dividends to state residents as a matter of legal "right." In 2011, a low payout year, each individual state resident received dividends of $1,174 (almost $6,000 for a couple with three children). In 2008 each resident received $2,069 (over $10,000 for a family of five).
Roughly two-fifths of the states (38 percent) also actively provide aid to worker-owned companies. Several directly support ESOPs (and/or worker cooperatives) with initiatives ranging from the linked deposit/investment programs in Indiana to education, technical assistance, and training programs in many states. Two states—Vermont and Ohio—support employee ownership centers that in turn leverage public funds to offer a variety of services to ESOPs and worker cooperatives.
By the way, almost half the states—twenty-three—in "capitalist" America also directly invest public funds in promising start-up companies. In Maryland, to take just one example, the Enterprise Investment Fund regularly invests in start-ups in exchange for equity and a guarantee from the firm that it will continue to operate in the state for at least five years. The fund has performed exceptionally well: Between 1994 and 2011 the state made total returns of $62.5 million on its investments. Successful ventures range from high-tech fluorescence and luminescence companies like Plasmonix to Advanced BioNutrition Corp., a Columbia-based company that extracts fatty acids from algae for use as nutritional ingredients in aquaculture (fish farming) and domestic animal feeds.
You get the idea: If you start getting serious about democratizing the ownership of wealth, there are many, many examples to build upon—and then extend. Most provide profits to cities and states that badly need revenues—and in turn, this obvious boon to taxpayers suggests some potentially interesting political possibilities for the future.
More to chew on in this regard shortly.
I can't resist one last illustration, just for the record, from that rock-ribbed bastion of Adam Smith–spouting conservatism—the great state of Texas.
The Texas Permanent School Fund was established more than 150 years ago with $2 million from the state's general fund. In 1876 roughly half of all the land (and associated mineral rights) in the state still in the public domain was added to the fund, and beginning in 1953 coastal "submerged lands" were also added after being relinquished by the federal government. The state-owned fund currently (2011) owns 626,000 acres of surface land and 12 million acres of mineral land and submerged land.
Every year a distribution is made from the profits of the publicly owned ("socialized") fund to defray education costs for every county in the state—roughly $2 billion in the last two years. The fund also guarantees bonds for local school districts, enabling them to pay significantly lower interest rates on their debt.
If Texas can find ways to do things like this, I suspect your state can explore quite different possibilities as well (with a little help from its friends).
Support Truthout's mission. Gar Alperotivz's new book, What Then Must We Do: Straight Talk About the American Revolution, is yours with a minimum donation to Truthout of $25, or a monthly donation of $15.
Copyright by Gar Alperovitz.
"Are You Man Enough?"
http://www.youtube.com/watch?v=q9W0tGIXBfA
There's not a street that you can walk
You got to watch just who you're talkin' to
They're out to get ya,
can't turn your back on a smilin' face
Next thing ya know, there ain't no trace of you
And this I betcha,
some people lose and some folks win
It's a matter of what they do
Are you man enough, big and bad enough?
Are you gonna let 'em shoot ya down?
When the evil flies and your brother cries
Are you gonna be around?
Someone needs a friend, just around the bend
Don't ya think you should be there?
Are you man enough when the goin's rough?
Is it in your heart to care?
There's no pretending it goes away
With every step that you take you pay your dues
and I ain't lyin'
You got to struggle to see the light
How someone's lookin' to steal your right to choose
And that don't stop tryin'
It's like a jungle outside the door and it's keepin' you so confused
Are you man enough, big and bad enough?
Are you gonna let 'em shoot ya down?
When the evil flies and your brother cries
Are you gonna be around?
Gotta keep your eye on the passers-by, better watch your step
'Cause ya never know where the knife would go And they ain't missed yet
The strong survive, they stay alive, they always do
But nothin' they ever teach you is true
Are you man enough, big and bad enough?
Are you gonna let 'em shoot ya down?
When the evil flies, and your brother cries
Are you gonna be around?
Someone needs a friend, just around the bend
Don't ya think you should be there?
Are you man enough when the goin' get's rough?
Is it in your heart to care?
Are you man enough, big and bad enough?
(Are you big and bad enough?)
Are you gonna let 'em shoot ya down?
When the evil flies, brother cries
(And your brother sighs)
Are you gonna be around?
Worker-Owned Cooperatives: Direct Democracy in Action
Saturday, 20 April 2013 10:45 By David Morgan, Occupy.com | Report
http://truth-out.org/news/item/15850-worker-owned-cooperatives-direct-democracy-in-action
Flashpoints—those unexpected events that movements gather around, when everything is accelerated, exciting, and energizing—fizzle. Whether they fail to gain traction, or splinter off to catalyze multiple new efforts, movement events serve an important function: they are shortlived and inspiring.
At the same time, they are moments of immense opportunity when we can make strides and pool our collective power. The cooperative movement is experiencing a string of these moments now, and is burgeoning with renewed activity. I see this firsthand as a co-owner of the Toolbox for Education and Social Action (TESA), a worker-owned cooperative that participates in many coop networks. We’ve facilitated hundreds of coop workshops around the country, and taught thousands with our resource Coopoly: The Game of Cooperatives.
It’s our philosophy that cooperatives enable direct democracy and local control over the economy. As participants in the coop movement, we help to turn flashpoints into lasting social change. Fortunately, the path to a community-controlled economy is well worn, and the adaptive responsive networks of the movement are buoying this energy. Over decades, these movement-based networks have quietly built support structures to transition us to a new economy. And with renewed demands for economic justice, they are springing to life.
The Model
As many look for ways out of the capitalist morass of boom-bust cycles, worker cooperatives have taken center stage. Cooperatives are democratic enterprises where both ownership and decision-making power are democratically shared. As a result, they keep money and power in the hands of the community.
There are many types of coops — credit unions, housing coops, food coops, and so on — and though they abide by the same Seven Cooperative Principles, all coops operate differently. Worker cooperatives involve everyone in decision-making on a one vote, one share-per-member basis. The company is also equally owned by all. Even though only 1% of the cooperatives in the United States are worker owned, their organizing success has recently made them a focal point in the struggle for economic justice. Indeed, Occupy Wall Street participants launched a worker-run co-op print shop in Brooklyn called OccuCopy.
These organizations are inspired by successful historical examples, like the Mondragon system in Spain, and Emilio Romagno in Italy, which provide a model for economic transition and sustainability. Today’s coops are also guided by an earnest, evidenced solidarity—in other words, they put their money where their mouth is—which provides support for members and fellow organizations alike. Guided by cooperative principle number six, which promotes cooperation amongst cooperatives, partnerships between coops were easily realized. They multiplied and soon turned to regional alliances, which snowballed into national networks.
The Network Hubs
Organizations that facilitate democratic ownership have been essential to the movement's lasting success, and their approach and structure differ from other social change institutions. Since worker control is so valued within the worker coop movement, these support organizations take the same shape as their member organizations and are structured as worker cooperatives.
Each member has a share of the organization, which makes them co-owners of the cooperative. When decisions need to be made that affect the group, each member has one vote to say how the cooperative is run — a mix of direct democracy and representational structures.
Inspired by the Mondragon cooperative network, the Valley Alliance of Worker Cooperatives (VAWC) came together in Western Massachusetts in 2005. The group first met at the U.S. Federation of Worker Cooperatives Eastern Conference on Workplace Democracy, and they are a direct result of national networks crystallizing at the regional level.
What sets VAWC apart is a strategy of coop-led development. The organization helps startup or transitioning coops get their footing; they provide technical assistance to their membership in the form of skillsharing and professional guidance. “We received help on things like bylaws, articles of incorporation and other things that are difficult for people running small businesses to get done while trying to keep everything going,” says Rebekah Hanlon, worker-owner of Valley Green Feast, one of VAWC’s member organizations.
VAWC recently launched an intercooperative loan fund. Through the fund, members tithe 5% of profits to help one another and to invest in new coop ventures. “We've gotten to a point where not only do we have knowledgeable cooperators from all walks of life meeting monthly, but we also have capital,” adds Rebekah.
“I look forward to the day when our loan fund is mature enough the help a business start up. It'll be a real accomplishment when a new coop can be supported with finances, technical assistance and intercooperative opportunities.”
The organization is structured as a worker coop, and operates by consensus with a membership comprised of representatives from other worker coops. They jointly share in promotional opportunities, both for their individual coops and for teaching the public about the model. VAWC’s work has a multiplier effect; each new coop they help launch can join the Alliance, which positions the group to help even more coops get off the ground.
"Being a part of cooperators directing and funding their own support and development has been a powerful experience,” says VAWC’s sole staff member, Adam Trott. “It has also been effective. Since 2009, VAWC has supported 4 worker coop conversions, co-created curriculum at UMass, Amherst as members of the Cooperative Enterprise Collaborative, co-founded the cross sector Valley Cooperative Business Association, launched the VAWC Intercooperative Development Fund and more."
VAWC enjoys an exceptionally cooperative cultural context in the Pioneer Valley, where there is a strong desire for economic democracy, and a history of collective management. In fact, by the time VAWC was formed, half of its its member organizations were independently operating, and had many cooperative allies.
A similarly rich cooperative culture exists across the country, in the San Francisco Bay Area, where the Network of Bay Area Worker Cooperatives, or NoBAWC (pronounced "no boss"), is a hub for the region, literally centralized within 30 minutes of each member organization.
A stunningly large network—nearly one out of every five U.S. worker coops are part of NoBAWC —most member coops are in Oakland, San Francisco, and Berkeley. Like other membership organizations, NoBAWC grew out of a need to collaborate and share best practices amongst like-minded organizations. The members now share resources and incentivize collaboration by offering each other reduced rates on their goods and services.
Since their formation in 1995, they’ve grown so large as to require a permanent staff person and a dedicated steering committee to chart the group’s longterm vision. Like VAWC, NoBAWC develops and promotes startup coops. Smaller, regional efforts like VAWC and NoBAWC now feed into a national network of worker cooperatives. As the first and primary national hub, the United States Federation of Worker Cooperatives (USFWC) brings together the full array of players within this movement. After many years of organizing, they were incorporated in 2004 to provide support to their membership, as well as educational outreach to the public. A small organization with a two-person staff, USFWC’s extensive work to promote cooperation puts them in the center of a dynamic movement.
The Federation connects its members to each other and to support organizations through referrals and their regular conferences and events. The support they provide to their members is both extensive and flexible. They provide essential information and resources according to the membership’s needs, such as meeting facilitation, or research into health plans. It is no small task to coordinate such a diverse patchwork of coops, and the USFWC capably handles a membership representing over 1,300 workers, from many different industries and geographies.
In addition, in the last few years, the USFWC launched the Democracy At Work Network (DAWN), a peer adviser system within worker coops that provides support, from sales to structure, to existing and startup worker coops.
“Resources are starting to be directed at worker cooperative development in a way we haven’t seen since the 1970s,” reports Melissa Hoover, Executive Director of the USFWC. “People are not just organizing individual cooperatives, they’re organizing cooperative networks for mutual aid and support. In the last five years, we’ve seen networks or proto-networks of existing cooperatives start in New York City, Madison, and Austin.” There is emergent interest in more national groups, as well, especially around core issues like financial access. These types of working groups aim to fill out the middle of the coop movement, acting as a working group somewhere between regional and national in scope.
The coop movement is gaining steam, drawing from new energies and a renewed interest in the model. All movements have these periods of acceleration, times when opportunity comes knocking at every turn. Typically, such are the times when reflection is most needed, because new dynamics can dramatically change the situation.
“Worker cooperatives are growing in visibility and scope, and while we shouldn’t be afraid of this, my own understanding of cooperative history and the system in which we’re embedded leads me to believe that we need to be cautious and strategic, and insist on the integrity of the form,” cautions Melissa Hoover. Thanks to savvy organizing, and much behind-the-scenes work, cooperatives have the structures in place and will continue to fight for nothing short of a new economy.
This piece was reprinted by Truthout with permission or license.
Why Is Socialism Doing So Darn Well in Deep-Red North Dakota? It's the Banks
Sunday, 31 March 2013 11:33 By Les Leopold, Alternet | News Analysis
http://truth-out.org/news/item/15435-why-is-socialism-doing-so-darn-well-in-deep-red-north-dakota
North Dakota is the very definition of a red state. It voted 58 percent to 39 percent for Romney over Obama, and its statehouse and senate have a total of 104 Republicans and only 47 Democrats. The Republican super-majority is so conservative it recently passed the nation's most severe anti-abortion resolution – a measure that declares a fertilized human egg has the same right to life as a fully formed person.
But North Dakota is also red in another sense: it fully supports its state-owned Bank of North Dakota (BND), a socialist relic that exists nowhere else in America. Why is financial socialism still alive in North Dakota? Why haven't the North Dakotan free-market crusaders slain it dead?
Because it works.
In 1919, the Non-Partisan League, a vibrant populist organization, won a majority in the legislature and voted the bank into existence. The goal was to free North Dakota farmers from impoverishing debt dependence on the big banks in the Twin Cities, Chicago and New York. More than 90 years later, this state-owned bank is thriving as it helps the state's community banks, businesses, consumers and students obtain loans at reasonable rates. It also delivers a handsome profit to its owners -- the 700,000 residents of North Dakota. In 2011, the BND provided more than $70 million to the state's coffers. Extrapolate that profit-per-person to a big state like California and you're looking at an extra $3.8 billion a year in state revenues that could be used to fund education and infrastructure.
One of America's Best Kept Secrets
Each time we pay our state and local taxes -- and all manner of fees -- the state deposits those revenues in a bank. If you're in any state but North Dakota, nearly all of these deposits end up in Wall Street's too-big to-fail banks, because those banks are the only entities large enough to handle the load. The vast majority of the nation's 7,000 community banks are too small to provide the array of cash management services that state and local governments require. We're talking big bucks; at least $1 trillion of our local tax dollars find their way to Wall Street banks, according to Marc Armstrong, executive director of the Public Banking Institute.
So, not only are we, as taxpayers, on the hook for too-big-to-fail Wall Street banks, but we also end up giving our tax dollars to these same banks each and every time we pay a sales tax or property tax or buy a fishing license. In North Dakota, however, all that public revenue runs through its public state bank, which in turn reinvests in the state's small businesses and public infrastructure via partnerships with 80 small community banks.
How the State Bank Creates Jobs
Banks are supposed to serve as intermediaries that turn our savings and checking deposits into productive loans to businesses and consumers. That's how jobs are supported and created. But the BND, a state agency, goes one step further. Through its Partnership in Assisting Community Expansion, for example, it provides loans at below-market interest rates to businesses if and only if those businesses create at least one job for every $100,000 loaned. If the $1 trillion that now flows to Wall Street instead were deposited in public state banks in all 50 states using this same approach, up to 10 million new jobs could be created. That would effectively end our destructive unemployment crisis.
No Bailouts for the BND
Banking doesn't have to be a casino. It doesn't have to be designed to create gambling opportunities so bank traders and executives can make seven- and eight-figure salaries. As BND president Eric Hardmeyer said in a 2009 Mother Jones interview:
We’re a fairly conservative lot up here in the upper Midwest and we didn’t do any subprime lending and we have the ability to get into the derivatives markets and put on swaps and callers and caps and credit default swaps and just chose not to do it, really chose a Warren Buffett mentality—if we don’t understand it, we’re not going to jump into it. And so we’ve avoided all those pitfalls.
As state government employees, BND executives have no incentive to gamble their way toward enormous pay packages. As you can see, the top six BND officers earn a good living, but on Wall Street, cooks and chauffeurs earn more.
•Eric Hardmeyer, President and CEO: $232,500
•Bob Humann, Chief Lending Officer: $135,133
•Tim Porter, Chief Administrative Officer: $122,533
•Joe Herslip, Chief Business Officer: $105,000
•Lori Leingang, Chief Administrative Officer: $105,000
•Wally Erhardt, Director of Student Loans of North Dakota: $91,725
The very existence of a successful BND undermines Wall Street's claim that in order to attract the best talent big banks need to offer enormous pay packages. Yet somehow, North Dakota is able to find the talent to run one of the soundest banks in the country? The BND is living proof that Wall Street's rationale for sky-high executive pay is a self-serving fabrication. (For more information on financial inequality please see my latest book, How to Earn a Million Dollars an Hour, Wiley, 2013.)
Wall Street Is Gunning for Bank of North Dakota
As you can well imagine, our financial elites would love to see this successful (socialist!) bank disappear. Its salary structure and local investments makes a mockery of Wall Street's casino banking system. But the bigger threat comes from the possible spread of this public banking concept to other states. Already, there are 20 or so state legislatures that are exploring state banks. Collectively, more public banks would pose an enormous threat to the $1 trillion in state and local bank deposits that now run through Wall Street.
But elite financiers also stand to lose much more. In the 49 states without a public bank, there's no safe place to turn for loans to rebuild schools and finance other public infrastructure projects. That creates an enormous opportunity for Wall Street firms to hook localities on expensive bond programs -- like capital appreciation bonds, which can lead to repayments equaling 10 times the original loan. Investment bankers and advisers also make enormous fees by selling expensive, high-risk financial schemes to state and local governments (read an investigative report here). But such schemes are useless in North Dakota where the state bank provides the capital the state needs for a fraction of the long-term costs.
Trade Agreements: Wall Street's Weapon of Mass Destruction
Clearly, from Wall Street's perspective, the North Dakota bank must go, and all other state efforts to replicate it must be thwarted. Wall Street's stealth weapon may be lodged within the latest corporate trade agreement called the Trans-Pacific Partnership (TPP), which currently is being negotiated in secret. We already know that Wall Street is seeking to remove all tariff restrictions that prevent the U.S. financial services industry from doing business in countries like Brunei, Chile, Malaysia, Mexico, New Zealand, Peru, Singapore and Vietnam. The biggest banks also want the treaty to eliminate "non-tariff" barriers including regulations that create "unfair" competition with state-owned financial enterprises.
Depending on the final language, it is possible that the activities of the Bank of North Dakota could be ruled illegal because "foreign bankers could claim the BND stops them from lending to commercial banks throughout the state," according to an analysis by Sam Knight in Truthout. How perfect for Wall Street: a foreign bank can be used as a shill to knock out the BND.
The Public Bank Movement
A small but highly dedicated group of financial writers, public finance experts and former bankers have formed the Public Bank Institute to spread the word. Working on a shoestring budget, its president Ellen Brown (author of Web of Debt), and its executive director Marc Armstrong have become the Johnny Appleseeds of public banking, hopping from state to state to encourage legislatures to explore state-owned banks.
The movement is gathering steam as it holds a major conference on June 2-4 at Dominican University in San Rafael, CA featuring such anti-Wall Street hell raisers as Matt Taibbi and Gar Alperowitz, along with Brigitte Jonsdottir, a member of the Icelandic parliament, and Ellen Brown.
Is America Up For This Fight?
Since the crash, the financial community has largely managed to wriggle off the hook. In fact, fatalism may be replacing activism as we sense that maybe Wall Street is simply too big and too powerful to change. After all, the big banks seem to own Washington, as too-big-to-fail banks are permitted to grow even larger and more invulnerable to prosecution and control.
But this new public banking movement could have legs, especially if it teams up with those fighting for a financial transaction tax (see National Nurses United.) Most Americans remain furious about how financial elites profited from the crisis -- before, during and after -- while the rest of us pick up the tab. Americans know deep down that Wall Street is the predator and we are the prey.
The state-owned and operated Bank of North Dakota proves that it doesn't have to be that way. This is the time to fight for public state banking in a big way.
You game?
This piece was reprinted by Truthout with permission or license.
How Worker-Owned Companies Work
Saturday, 30 March 2013 10:03 By Theresa Riley, Moyers & Company | Interview and Video
http://truth-out.org/news/item/15425-how-worker-owned-companies-work
Economist Richard Wolff is a proponent of democracy at work: an alternative capitalism that thrives on workers directing their own workplaces. In the documentary film Shift Change, producers Mark Dworkin and Melissa Young tell the stories of successful cooperative businesses from Spain to San Francisco. We caught up with Dworkin and Young to find out what makes cooperative businesses work.
Theresa Riley: What drew you to this topic as filmmakers? Why did you want to make this film?
Mark Dworkin and Melissa Young: As filmmakers we don’t just expose problems. We want to help people find solutions. In 2002 we were in Argentina at the height of their economic crisis, and in hundreds of workplaces which had closed, workers took over the company, went back to work, and made a go of it. These examples made quite an impression on us, and we featured their stories in two films: Argentina — Hope in Hard Times and Argentina Turning Around. A friend who saw the Argentina documentaries suggested that we learn more about the Mondragon cooperatives in the Basque Country of Spain. When we did, we were moved and inspired by this successful model of worker ownership and its potential to change the culture of work — not just in Spain but around the world. Our investigations revealed that there are hundreds of thriving worker cooperatives that promote economic democracy right here in North America, but they are little known.
Riley: How many businesses in America are worker-owned?
Dworkin and Young: Employee ownership in the U.S. is much more widespread than usually understood, with at least 11,000 such businesses in operation. Many are Employee Stock Ownership Plans or ESOPs, where employees own part or all of the company. Introduced under President Nixon, this is one way for private companies to transition to employee ownership. ESOPs may or may not be democratic and participatory places to work. Worker cooperatives are both owned and managed by their workers — one worker, one vote. According to the U.S. Federation of Worker Cooperatives, currently there are about 400 worker cooperatives in the U.S. They operate many types of businesses, mainly services, and are growing especially among Latino immigrants and in working class communities.
Riley: Most of the businesses you visited in the film seemed to have weathered the economic downturn of recent years. But have some co-ops failed? How do privately-owned small businesses and worker-owned businesses compare? Do they fail less often?
Dworkin and Young: One of the challenges faced by cooperative businesses is that they have to survive in the larger economic system, over which they have little control. Worker co-ops in Mondragon and in the U.S. have done better than other similar sized businesses in the current economic crisis. When sales and profits are down, worker owners don’t just close the doors. People take a hard look and try to figure out what they can do to make things better – such as adding new products or finding ways to improve efficiency and productivity. At any given time some co-ops are doing better than others, depending on the industry in which they operate. So in Mondragon each year co-ops that are profitable pay into a “rainy day fund,” and co-ops that are going through hard times are able to withdraw funds to help them out. In co-ops where business is slow, members can often find temporary work in co-ops that are doing better. And since workers own and manage the company, they may agree to reduce their pay on a temporary basis until business picks up again. That way nobody has to lose their job. Cooperative networks that function in a similar way are just beginning in the U.S.
[Removed]
How the Coop Movement Can Help Us Win Together
by Toolbox for Education and Social Action
Workers at the former Republic Windows & Doors have been much celebrated in the press for their victory over Bank of America. Their story is an inspiration, and a precious victory that we will continue to cheer. True to the cooperative movement, their transition to become New Era Windows was supported by a network of allies who propelled the workers into the limelight and helped them overcome those banks that were deemed too big to fail. Theirs is a story of sharing ideas and making a joint effort at movement building, with co-op developers, unions, and the workers themselves as players.
Republic’s workers were unionized, and as members of Local 1110 of the United Electrical, Radio and Machine Workers of America, they had a sneaking suspicion that layoffs were coming. In late 2008, Bank of America cancelled the company’s line of credit, driving Republic into bankruptcy, the workers were set to be laid off without their dued severance pay or other benefits. Mark Meinster, one of the ambitious union organizers from Local 111, suggested that the embattled workers occupy the factory. Their suggestion was met with some skepticism—even other union organizers thought for sure they’d be arrested—but their risk paid off, and the workers won back what the bank had threatened to take away. Photo: Marianne O'Leary / flickr
However, in 2012, after this momentous win, Serious Energy, the company that eventually bought out Republic, attempted to oust the workers a second time, precipitating another factory occupation. The forward-thinking organizers who won the first time around mobilized again, and after a second victory, began thinking about forming a worker cooperative. It was a hard-fought and ultimately successful showdown, but the union needed more support to make the transition to the co-op model. Those same workers who twice occupied Republic have since decided to take permanent control of the company and turn it into a cooperative called New Era Windows.
Enter the Cooperators
One of the key members of this cooperative team is the Center for Workplace Democracy (CWD). Based in Chicago, CWD was founded in October of 2011 as a “worker-ownership development center.” A four-person organization, CWD knew their business hinged on their ability to work with and learn from their allies. They drew on the experiences of Cooperation Texas and Green Worker Cooperatives, and reached out to the groups that had helped germinate the ideas that made those organizations successful.
CWD is a young organization that mixes public education and advocacy with professional training and technical assistance. These skills have enabled them to assist with Republic’s transition, and they prepared organizational documents for the company that addressed its new business structure, incorporation details, and so on. CWD also provided guidance with regard to cooperation—how to work collaboratively within the new framework—and hard administrative skills for the new worker-owners, who had no prior managerial experience.
Taking control of Republic was primarily a political struggle, and its organizers used economic means to solidify their victory. True to their mission to provide investment capital for worker cooperatives, a nonprofit organization called The Working World extended their help to negotiate the purchase of the factory, and find a new space for the company.
Funding a Worker Takeover
When, in 2012, Serious Energy dragged their feet and delayed the buyout, preferring instead a plan to scrap the machinery and sell the recycled metal, The Working World shined a light on their malfeasance, publicly shaming the owners of Serious while actively fundraising on the workers’ behalf. Donations streamed in, amounting to nearly $9,000 in additional start up funds, which was added to the buy-in capital that workers contributed when they elected to become a cooperative. The Working World then went a step further and became New Era’s sole backer, providing $500,000 in seed money.
In order to move to the next stage, the worker-owners of New Era and CWD worked on crafting their business plan, and obtaining the skills they’d need to make it in the long run. The beacon that New Era lit shined light on a number of other potential avenues for broadening the co-op movement in Chicago, and CWD took up this charge, forming a Co-op Academy to help develop similar aspiring worker co-ops. Based on hands-on, democratic, and experiential learning.
Our own organization, the Toolbox for Education and Social Action, is developing curriculum for CWD’s Academy. We are collaborating with the Academy students on creating program components, and creating other resources to connect the participants with practitioners in the field.
Together, we will work within Chicago’s emerging co-op movement, developing curriculum that is sensitive to the students’ context and responsive to their needs. The curriculum will be put to use in CWD’s 12-week long Cooperative Business Academy, launching in fall of 2013, which includes the full scope of co-op development.
The contributions of these organizations and their ongoing collaborations shows that Republic Windows & Doors struggle was more than just a flash point. It energized those involved and brought about new partnerships that continue to give shape to the new economy, and we can use these partnerships as a model for other struggles. The workers who initiated and sustained New Era’s efforts bring out the best of the cooperative movement: that empowered workers can create profound, fundamental change.
http://www.commondreams.org/view/2013/03/03-3
Food and Land at the Service of People: an Interview With Peter Rosset
Sunday, 24 February 2013 07:54 By Tory Field and Beverly Bell, Other Worlds | Interview
http://truth-out.org/news/item/14749-food-and-land-at-the-service-of-people-an-interview-with-peter-rosset
Agricultural economist Peter Rosset is with the Center for the Study of Rural Change in Mexico and the Land Research Action Network. He is also a member of the technical support team of Via Campesina. Beverly Bell talked with Peter Rosset in Havana in 2009; they updated the interview in 2012.
There are several fundamental pillars that are necessary to take control over food and agricultural systems. One is to force even reluctant or reactionary governments to regain control over their national borders from the flow of imported food. That means canceling free trade agreements and not signing WTO agreements. It means stopping the import either of incredibly cheap, subsidized food from agro-export countries which drives local producers out of business, or of food made ridiculously expensive by food speculation. Governments also need to support peasant and small-farmer agriculture as the fundamental source of food for national economies. Why not big farms or agribusiness? It’s more than proven in any country in the world that if agribusiness controls the majority of the land, there will not be enough food for people because agribusiness just doesn’t produce food for local people. What agribusiness does, be it the United States or Thailand, is produce exports.
Sometimes those exports are not even food for people but soybeans for animals, or ethanol, or biodiesel for automobiles in other part of the world.
On the other hand, the real vocation of the small farm, the family farm, the peasant farm, the indigenous farm, is producing food for the family, for the local economy, and for the national economy. All over the world, these farmers are underrepresented in control of land. So a second essential element to claim control over food and agricultural systems is for countries to place their bets on peasant and family agriculture. And that means land has to be taken away from agribusiness. That, in turn, means real agrarian reform, redistribution of land to people who are landless, who are poor, who want to earn a living with dignity by producing food for people. And that means rebuilding small and family agriculture by investing in it. That necessitates changing budget priorities so that, instead of government subsidies flowing to support the exports of agribusiness, they flow to small farms.
Yet a third pillar in reclaiming control of agriculture means changing how we produce food. Via Campesina and other social movements say that we can no longer afford to keep food prices tied to the cost of petroleum. We can’t keep using indiscriminate amounts of chemical fertilizer, tractors, mechanical harvesters, and pesticides. We need to engage in ecological agriculture that preserves soil fertility for future generations.
Fourthly, we need to defend the territories of indigenous peoples and peasant communities who haven’t yet lost their land. Part of the strategy must also be to gain new territories through land reform or land occupations.
A fifth element involves seeds. We can’t allow seeds to be patented and privatized by Monsanto and Syngenta and other corporations. We can’t allow them to be contaminated by GMOs. We need to support the free exchange of local, indigenous seeds, because those varieties are much more adapted to local environmental conditions and can form a much stronger basis for new national food systems. Sixth, we need to nationalize the food reserves that are in the hands of transnational corporations.
Part of the origin of the recent food crisis is that under neoliberal policies of the past 20 years, most countries sold off their food inventories that were in the hands of the public sector. World food reserves are now largely in the hands of private corporations like Cargill and Archer Daniels Midland. This is a problem because when it comes to food reserves, the public sector and the private sector behave in exactly opposite ways. If there’s a food shortage, the public sector releases food from storage so that prices won’t rise so fast, or so people who can’t afford food can get it from public sources. But private traders and transnational corporations hoard and speculate. That is, they withhold food from the market in order to drive prices up even higher so that they can make a windfall profit, at the cost of some people not being able to eat.
But we can’t just renationalize food reserves in the hands of governments because we can’t trust governments. There has to be some kind of a co-management scheme where farmers and consumers, through their social movements and grassroots organizations, participate in owning and managing food reserves so that those reserves exist in every country – but at the service of people, not of private profit.
Via Campesina and allied social movements have all gathered together under the banner of food sovereignty. This is the collective banner of struggle to build counter-power to transnational corporations, to renationalize food systems, and to regain control over rural territories and the land. To make sure that land is used to support rural peoples. To support production, for local and national consumption, of healthier food, more affordable food, food that’s not speculated with, that’s not hoarded, that’s not contaminated with GMOs. To reclaim our food systems and protect our lands and territories.
Download the Harvesting Justice pdf here http://www.otherworldsarepossible.org/sites/default/files/documents/Harvesting%20Justice-Transforming%20Food%20Land%20Ag_0.pdf , and find action items, resources, and a popular education curriculum on the Harvesting Justice website.
This piece was reprinted by Truthout with permission or license.
Lifting the Veil of Mirage Democracy in the United States
Wednesday, 13 February 2013 00:00 By Kevin Zeese and Margaret Flowers , Truthout | News Analysis
http://truth-out.org/news/item/14489-lifting-the-veil-of-mirage-democracy-in-the-united-states
We live in a mirage democracy," Zeese and Flowers assert, as they trace the history and describe the institutions of a not-so-robust US democracy.
"Democracy" demokratia = demos+kratia; or democracy = people+power.
The "greatest democracy on Earth" is how the United States is portrayed to its people and the world. The hallowed words "We the people" and "Of, by and for the people" echo in the minds of Americans to characterize the United States. But do they accurately describe the "democracy" we have?
In reality, a constant conflict that has existed throughout US history, indeed throughout the history of democratic states, is present between the elites and the people. Justice Louis Brandeis said it well when he stated, "We may have democracy, or we may have wealth concentrated in the hands of a few, but we can't have both."
Over the past 40 years, income inequality in the United States has exploded from its lowest level in 1978 . What kind of democracy exists under these circumstances? And is real democracy possible for a global empire? How does nation-state democracy exist within the new globalized economy that serves transnational corporations?
A New Vocabulary for "Democracy"
A new vocabulary is developing to describe the current state of democracy in the United States. We begin with some key words and phrases.
Managed Democracy: A governmental system that includes widespread voter franchise and competitive elections, but the elections are managed so that no matter what candidate(s) are elected, the elites win. The role of citizens in government is to choose between two pre-selected candidates, neither of whom will represent the people's interests and both of whom will represent the elites' interests. Chris Hedges refers to this as "political theater."
Polyarchy: A term highlighted by Cliff DuRand, author of "Recreating Democracy in a Globalized State," that is very similar to managed democracy. He calls it a low-intensity democracy that veils the rule of elites and allows citizens to think they are participating in power through contested elections that do not change the elite power structure.
Inverted Totalitarianism: Classical totalitarianism is the model of Hitler or Mussolini, an all-powerful government led by a charismatic leader that partners with business interests in a security state. Inverted totalitarianism is a similar marriage of government and business, but the measures employed to maintain this relationship are more subtle. It is the coming of age of corporate power, maintained through a security state working in tandem with corporate propaganda that permeates influential institutions such as the media, education, popular culture and evangelical religion.
Globalized State: This is a government that serves the interests of transnational capital devoid of any real connection to the people of the nation. The globalized state rules through economic structures such as trade agreements, the International Monetary Fund, World Bank, World Trade Organization and through international military actions.
Capitalism: An economic system based on private ownership of capital, goods and the means of production. Goods and services are produced for profit. It is an inherently unequal system. In feudalism, political power and the economy were united in the noble class. Under capitalism, there is a separation of political and economic power, which gives people the impression of participation.
Neoliberalism: The dominant economic ideology of the last three decades which insists upon an extreme separation of government and capital so that the market can operate "freely." The market operates only in the interests of individuals without allegiance to the collective society. Government exists solely to provide basics such as standards for weights and measures, laws and courts to protect property and infrastructure for the market. Neoliberalism welcomes state intervention only when that intervention is to corporate advantage as in trade agreements, bailouts or corporate welfare. Under neoliberalism, state resources and public programs are decreasingly funded and increasingly privatized. DuRand states that neoliberalism is the "default position of capitalism to which it reverts unless restrained by popular struggles."
Neofeudalism: This is the reconfiguration of political and economic systems to create an empowered tiny oligarchic elite class. Chris Hedges points to the structure described by George Orwell in "1984" in which there is an inner party (2 to 4 percent) of corporate and political managers, an outer party (12 to 14 percent) that consists of managers, the security state and the propaganda arm, and the rest of the population exists as "proles."
The Birth of US "Democracy"
The United States celebrates the founding of the country and the so-called "Founding Fathers" as the birth of democracy, but the real democracy movement occurred before the American Revolution. In fact, it was the founding fathers, a group of propertied elites, slave holders, noted lawyers and wealthy merchants, who created a system designed to prevent a truly democratic state.
In the pre-Revolutionary period, the American democracy movement involved small farmers, laborers, artisans, shopkeepers, seamen, women, African slaves and native Indians who revolted against the grievances of the day. There existed abolitionists who opposed slavery and slaves who rebelled against plantation owners. Disputes over taxes, ordinances, and land titles and of being ruled over by a royal governor, who represented a distant British government or a corporate monopoly like the British East India Company, were sources of democratic revolt.
Colonial governments were structured for the elites and only those with substantial property ownership had any right to participate. Sheldon Wolin, in Democracy Inc. describes the rise of a "fugitive democracy" in this period. There were spontaneous protests, assemblies, petitions, tarring and feathering of government officials, burning effigies of officials, surrounding courthouses and removing government officials from office and storming jails to free their own. Committees of correspondence were formed to coordinate actions with counterparts in other colonies. This democracy movement was born out of necessity, out of the struggle for survival against deep-seated grievances and was improvisational rather than institutionalized.
Ray Raphael in The First American Revolution: Before Lexington and Concord describes colonists in Great Barrington, Massachusetts, filling the courthouse to prevent British judges from entering. And, in Worcester, 4,622 militiamen from 37 surrounding communities lined Main Street as crown-appointed officials walked the gauntlet, reciting their resignations 30 times each, "so all could hear." Raphael reports that these common people were intensely democratic, disavowing all leadership. In fact, "when they elected representatives, they did so on a day-to-day basis."
Wolin writes that in the period from 1760 until the Constitutional Convention, there was intense political interest that formed an "American demos" that "began to establish a foothold and to find institutional expression, if not full realization. State constitutions were amended by provisions that broadened voting rights, abolished property qualifications for office, and in one case, instituted women's suffrage. There were also efforts to ease debtor laws, even to abolish slavery." It was these attacks on property that prompted several "outstanding politicians" (also known as the founding fathers) to "organize a counter-revolution aimed at institutionalizing a counterforce to challenge the prevailing decentralized system of thirteen sovereign states in which some state legislatures were controlled by 'popular' forces."
These outstanding politicians were some of the wealthiest property owners in the United States, slave holders, well-known lawyers and merchants. James Madison, credited as being the "father" of the Constitution, wrote in The Federalist Papers #10: "Democracies have ever been . . . incompatible with . . . the rights of property . . . [because it would threaten] the unequal distribution of property." The founders were concerned with "the excess of democracy" as one delegate to the convention said. The new Constitution put property rights ahead of human rights.
The "founders" proposed a new system of national power that discouraged the "American demos," removed people from the councils of government and reduced the power of states. The Constitution favored elite rule and protection of property. It established a republic in which courts protected minority rights and property rights from majority sentiment, and government power was limited.
Only the House of Representatives would be directly elected by the people, at least the limited group of six percent of the white, male property-owning population that was allowed to vote. Wolin writes, "The Constitution of the Founders compressed the political role of citizen into an act of 'choosing' and designed it to minimize the direct expression of a popular will." The president was not directly elected, but rather citizens voted for electors who chose the president in the Electoral College. Senators were selected by state legislators, and judges were appointed by the president. It created a representative, not participatory or direct, democracy. The "right to vote" is not even mentioned in the Constitution.
While people were declared "sovereign," they were, in fact, "precluded from governing." "From the beginning," Cliff Durand writes, the country "was designed to be undemocratic." The role of the people was limited to choosing from among the political elite the representatives who would rule them. This managed democracy or polyarchy is far removed from the people power of real democracy. As Durand writes, "Democracy means people's power, not the legitimizing of elite rule."
Throughout US history there have been democratic moments when the people sought to seize power. These included Jacksonian democrats, abolitionists, suffragettes, populists, progressives, civil rights activists and '60s radicals; and the Occupy movement of today. These political conflicts have "often been described as a war between 'the haves and the have-nots.' "
The Rise of the Corporate State
Beginning in the 19th century, wealth and power shifted from property owners and merchants to corporations. This shift was accelerated during the industrial revolution, when corporations gained great economic and political power. Wealth became more concentrated in the hands of a few robber barons, who used it as political leverage. President Abraham Lincoln warned in a November 21, 1864, letter to Colonel William F. Elkins about the corruption that would follow this rise of corporate power:
"I see in the near future a crisis approaching that unnerves me and causes me to tremble for the safety of my country. . . . corporations have been enthroned and an era of corruption in high places will follow, and the money power of the country will endeavor to prolong its reign by working upon the prejudices of the people until all wealth is aggregated in a few hands and the Republic is destroyed." Mass production and new forms of energy and transportation allowed industrialists to accumulate wealth rapidly. This wealth was used to amass more resources and control over the economy. Industrialists bought up their competitors and formed monopolies. They enriched themselves through cheap labor. Workers were housed in unsanitary factory towns and forced to work in unsafe conditions. They were paid low wages and charged high prices for basic goods in factory-owned stores.
Many of the wealthiest people in US history made their riches during the industrial revolution: oil magnate John D. Rockefeller; steamboat and railroad businessman Cornelius Vanderbilt; Andrew Carnegie with his empire of steel; financiers Jay Gould, Andrew Mellon and J. P. Morgan; and mass producer of automobiles Henry Ford.
The industrial revolution was also a time of gross political corruption. Bribery of politicians and bureaucrats and the gift of political positions and contracts in return for favors and loyalty ran rampant. The result was two political parties loyal to the elites with narrow agendas that were unwilling to challenge the status quo in any meaningful way.
The courts were no better. The Fourteenth Amendment, passed in 1868 to provide due process of law to freed slaves, was used mostly to empower corporations. In 1886, the Supreme Court voided 230 state laws that regulated corporations, primarily freight rates charged to farmers, on the basis that the regulations deprived corporations of property without due process. Of 307 Fourteenth Amendment cases considered by the Supreme Court between 1890 and 1910, 288 were about protecting corporate rights, only 19 about people. This is when the court established that corporations were "legal people" while at the same time protecting corporate owners from criminal prosecution.
The situation rose to a head under the presidency of Franklin Delano Roosevelt (FDR), who was elected after the depression began. The Roosevelt family is one of the oldest banking families in the nation, as are the Delanos. His great-grandfather James Roosevelt founded the Bank of New York in 1784, and five generations of Roosevelts headed that bank. Before that the family helped fund the American Revolution. FDR's uncle, Fred Delano, was appointed to the first Federal Reserve Board in 1914. FDR's first job was with a JP Morgan law firm, and he lived in the home of JP Morgan partner Thomas Lamont when he went to Washington, DC, as assistant secretary of the Navy. During the '20s, before he became governor of New York, he was a Wall Street investor, banker and lawyer. During FDR's presidency, when he broke from the gold standard and created mass government jobs, the financiers and big business interests who funded his campaigns were shocked. A group of businessmen planned a coup and contacted General Smedley Butler, the most decorated Marine in history, to become the American Mussolini and make FDR either a figurehead or remove him. Butler blew the whistle and although a congressional committee confirmed the plot, there were no prosecutions. Many of the corporations bailed out in the recent financial collapse came from the same corporations allegedly involved in the coup attempt. Perhaps a more sophisticated coup has taken place now.
Following World War II, new institutions were created that propelled the rise of the global corporate state. In 1944, members of 44 nations gathered in Bretton Woods, New Hampshire, to discuss how to rebuild the international economy. The United States was the dominant power at this meeting. Out of it came the Bretton Woods System, which tied official reserves to the US dollar instead of to gold.
This conference also gave birth to the International Monetary Fund (IMF) and the precursor of the World Bank. Shortly after that, the General Agreement on Trade and Tariffs (GATT) was created, which reduced barriers to trade between nations. In 1995, it became the World Trade Organization (WTO). This shift was significant because unlike the GATT, the WTO had the power to enforce rules, which meant that nations were required to change their laws to comply with rules put forth by the WTO. Today, the largest trade agreement in history, the Trans-Pacific Partnership, which is being negotiated by the Obama administration in secret except for 600 corporate advisors, will result in a global corporate coup.
Since the 1980s, the era of so-called "free trade," the world has seen the rise of transnational corporations. This has allowed the off-shoring of jobs that has hollowed out the US labor market and caused labor's share of the GDP to hit an all-time low. It has also allowed the free flow of finance overseas, the avoidance of more than $100 billion in corporate taxes and the growth of international tax havens housing tens of trillions of dollars off-shore. Neoliberalism, which had been unleashed upon the world, is now coming home to the US.
Of Monopolies and Sacrifice Zones
DuRand describes unfettered capitalism, or neoliberalism, as a game of Monopoly. In the Parker's Brothers game, the players begin on equal ground. The goal of the game is to amass wealth and property to the point of collapse, bankrupting the other players who are no longer able to participate. He writes that, just as in Monopoly, inequality is an integral part of a capitalist economy.
In the board game, when only one player is left, the game ends. Players may choose to start fresh with a new game. In the real world, there is no reset. Instead, there is the drive toward greater degrees of inequality as the rich become richer at the expense of people and the planet. Occasionally there is respite in the form of social programs that counter the effects of neoliberalism, but in the absence of popular struggle, the drive toward greater profits continues unabated.
In his most recent book, "Days of Destruction, Days of Revolt," Chris Hedges describes the real effects of neoliberal policies on US communities. His words are made even more powerful through the illustrations of Joe Sacco. Hedges and Sacco stayed in communities that have been destroyed economically and environmentally for the sake of corporate profits. They call these areas "Sacrifice Zones" and define them as "areas in the country that have been offered up for exploitation in the name of profit, progress and technological advancement." Their intention was to show "what life looks like when the marketplace rules without constraints, where human beings and the natural world are used and then discarded to maximize profit."
Hedges and Sacco reported on levels of poverty and poisoning of communities that most Americans don't recognize as existing in the United States. They tell stories of drug use and violence that arise as people are trapped in losing situations that involve great suffering. And they describe efforts of those who try to provide some relief. Hedges states that their stories are "important windows into what is happening to the rest of us."
In the final section of the book, they cover the Occupy protests, which arose in large part because of growing wealth inequality and fraud by the elites. At some point, people do rise up and fight back. Those in power know this and employ all sorts of tools to prevent it.
The Maintenance of the Corporate State
The actions of the robber barons of the 19th and early 20th centuries resulted in such abuse of workers and poor living conditions that labor and others joined in protest. The response of the elites was the New Deal, which brought some relief, calmed the masses and allowed capitalism to continue.
Relative quiet ensued until the 1960s and early '70s, when multiple struggles manifested in movements for civil rights, opposition to war, the environment and women's rights. DuRand writes that this uprising was described by elites as a "crisis of democracy," meaning that people were demanding too much democracy. Capitalists felt under attack once more. Following a blueprint developed by Lewis Powell in his memo to the US Chamber of Commerce, they built institutions over the next 40 years, including think tanks, lobbying firms and courts, to promote the market agenda and control the media and universities to prevent another outbreak of democracy.
We are living in a time of Inverted Totalitarianism, in which the tools used to maintain the status quo are much more subtle and technologically advanced. These include propaganda and control of the major media outlets that hide the real news about conditions at home and our activities around the world behind distractions such as high-profile citizen trials and celebrity gossip. The major electronic media, owned by six corporations nationwide, also routinely misinforms the public about domestic and foreign policy. A recent example is the "Fiscal Cliff."
Another tool is to create insecurity in the population so that people are unwilling to speak out and take risks for fear of losing their jobs and being unable to afford food, a home and health care. Changes in the work environment, such as the attack on unions and the war on whistleblowers, have led to greater job insecurity. Changes in college education also silence dissent, including the trend toward adjunct rather than tenured professors. Adjunct professors, now comprising 85 percent of faculty, are less willing to teach topics that are viewed as controversial. This, combined with massive student debt, are tools to silence the student population, once the center of transformative action.
Hedges describes the growing security state and is actively fighting provisions within the National Defense Authorization Act (NDAA) that allow the indefinite detention of US citizens without trial. Legal experts fear the NDAA also weakened Posse Comitatus, passed in 1878 to limit federal military powers, so that the military can be used on domestic soil. There is obvious collaboration between military and local police departments through joint training exercises, paramilitary police forces and new equipment such as tanks and drones. The Department of Homeland Security is building a 176-acre secure compound in the lowest-income area of Washington, DC.
Laws, such as the Patriot Act and Foreign Intelligence Surveillance Act, allow warrantless wiretapping of US citizens. In fact, whistleblower William Binney, who served in the NSA for 40 years, estimates that the NSA is currently storing between 15 and 20 trillion communications, including domestic emails and billing transactions. And the Pentagon is set to increase its cyber-security program by five-fold.
Other, more subtle forms of public control come in the form of organizations that function to protect the interests of corporations and their servant political parties. This may occur through direct creation of "astro-turf" groups or by co-optation of existing grassroots and other groups by granting them increased access to politicians and controlling their access to foundation grants and donations. A recent example involves Obama's "enforcer," Jim Messina, who met with liberal organizations during the health reform process to keep them in line with the Democratic agenda. DuRand writes that in polyarchy, "it is through its penetration and co-optation or even creation of the components of civil society that the elite garners the consent of the people to its rule and thereby achieves governability."
Those groups that directly challenge the system and cannot be co-opted by money or access are routinely infiltrated for the purpose of spying, dividing and destroying. More evidence of infiltration and spying on Occupy is coming to light.
We live in a mirage democracy. Elections have become expensive spectacles with $2 billion presidential campaigns and a corporate media that reports on the political drama every day for months on end. Elections are tightly controlled, rigged for the two parties by restrictive ballot access laws, a corporate-run debate commission that blocks third parties, gerrymandered voting districts, unverifiable computer vote counts and a mass media that does not cover alternatives to the corporate duopoly. US voting systems are among the least democratic in the world. They lack modern, more democratic approaches like universal voter registration, proportional representation and ranked choice or instant run-off voting. Only half the US public is registered, and only half of registered voters vote, so these mirage elections provide a less than legitimate government.
Our next article, Part II of this series on democracy, will focus on how participatory government and economic democracy are being put in place in Latin America and steps being taken in those directions in the United States. If we are to achieve the "We the People" government to which we aspire and end the mirage democracy we are in, these are the twin pillars on which real democracy will stand.
You can hear our interview with Chris Hedges and Cliff DuRand: What Kind of Democracy Exists in the US? on Clearing the FOG Radio (podcast) or view it on UStream/ItsOurEconomy.
This is Part I in a series on democracy in the United States. Next week we examine participatory democracy as an antidote to managed democracy.
You can intervene in the nation's budget debate by watching a Roots Action video and writing your Congressional representatives and the president here.
This article was first published on Truthout and any reprint or reproduction on any other website must acknowledge Truthout as the original site of publication.
"Shift Change": Creating Economic Democracy Through Workplace Cooperatives
Tuesday, 05 February 2013 09:10 By Mark Karlin, Truthout | Interview
http://truth-out.org/opinion/item/14342-shift-change-creating-economic-democracy-through-workplace-cooperatives
Shift Change brings you behind the scenes of some of the most exciting cooperative successes in Europe and the United States. This is a movement that's creating jobs, strengthening communities and showing that another economy is possible. It's a movement that's taking off - and Shift Change is the way to understand what's happening. - Sarah Van Gelder, YES! Magazine
Shift Change is a timely documentary about the growing cooperative movement. In the last two years, Truthout has posted many articles on the efforts to achieve economic democracy through worker ownership. Shift Change offers an energizing look at the workings of the giant cooperative model, Mondragon, in Basque, Spain. The film also covers strong US-based worker-owned enterprises that prove the investor Wall Street model of business is not necessary to a successful company.
Mark Karlin: You and your documentary partner, Melissa Young, have completed more than 20 documentaries covering progressive issues, like the threat to unions, the dangers of biotechnology ill-applied, international grassroots environmental activism, and more. What, at this time, brought you to the topic of cooperatives as featured in Shift Change?
Mark Dworkin: In our documentary work together we look at political and social issues not only to rehash what is wrong, but also to offer realistic ideas about what might be done about it. In 2002 we were in Argentina at the height of their economic crisis, and in hundreds of workplaces which had closed, workers took over the company, went back to work, and made a go of it. These examples made quite an impression on us, and we featured their stories in two films - Argentina - Hope in Hard Times and Argentina Turning Around. In 2010 at the US Social Forum, a friend suggested it was time for a new film about Mondragon - and that we ought to make it, since our Argentina films show we understand the potential for worker co-ops, and we have a lot of experience filming in Spanish-speaking countries. He was able to help us find start-up money, and we went for it. We quickly realized we should include the stories of several co-ops in the US, so our audience would not get the mistaken idea that worker co-ops cannot succeed here.
Mark Karlin: A good chunk of Shift Change explores the mother of all cooperatives, Mondragon, in Basque Spain. Can you explain the history and current structure of Mondragon, as well as its size?
Mark Dworkin: The Mondragon cooperatives began in the difficult years following the Spanish Civil War. Spain had a dictator who had a grudge against Basque country, because the Basques had opposed his violent rise to power. Left to themselves to rebuild from the war and create a viable economic future, people in Basque country were willing to try something new. Inspired by a visionary priest, they started a technical school that emphasized Christian principles of cooperation. Five graduates of that school who went on to get engineering degrees, set up the first industrial cooperative, soon followed by others, always with an eye to the future development of their region. Now, more than a half-century later, there are 85,000 workers in 120 independent cooperatives, working together for the common good. They do $25 billion worth of business a year. They have their own bank and one of Spain's largest supermarket chains. They make appliances, machine tools, computer equipment, and compete successfully in the global economy.
Mark Karlin: Spain is one of the southern European Community countries struggling with unemployment. How does Mondragon strategically deal with a global economic downturn in terms of unemployment at the cooperative?
Mark Dworkin: One of the challenges faced by all cooperative business is that they have to survive in the larger economic system, over which they have little control. Nonetheless, cooperatives in Mondragon and in the US are faring better in the current crisis than other, similar sized businesses. When sales and profits are down, they don't just close the doors. People take a hard look and try to figure out what they can do to make things better. Generally some of the co-ops are doing better than others, depending on the industry in which they operate. So each year Mondragon co-ops that are profitable pay into a "rainy day fund," and co-ops that are going through hard times are able to withdraw funds to help them out. In co-ops where business is slow, the members can often find temporary work in co-ops that are doing better. And since workers own and manage the company, they may agree to reduce their pay on a temporary basis until business picks up again. That way nobody has to lose their job.
Mark Karlin: Tell us a bit about the Evergreen Cooperatives in Cleveland. How would Evergreen play out as a model for other cities?
Mark Dworkin: The Evergreen Cooperatives take much of their inspiration from Mondragon. They are a wonderful example of business, labor, local government and civic foundations working together to re-develop their region. Rather than offer large sums of government and foundation money to private companies to move to Cleveland - only to have them move somewhere else a few years later - they decided to use those funds to start new businesses, based in the inner city, which are owned and managed by their employees. And they made strategic partnerships with major local institutions, such as Case Western Reserve University and the Cleveland Clinic to buy the products and services that these cooperative businesses would offer. Many other cities are sending delegations to Cleveland to study the Evergreen model with an eye to adopting the idea - though in each case the best products and services will depend on the needs of each city and the resources it can leverage. Local anchor institution partners would depend on local conditions, but the idea of business, labor, community, and government working together for the common good can take hold anywhere.
Mark Karlin: The United Steel Workers (USW) launched a relationship with Mondragon not too long ago. How is that working out? Has anything come of it at this point? Does the USW plan to challenge the traditional capitalist management and profit model?
Mark Dworkin: The USW/Mondragon collaboration has a number of pilot ventures just getting off the ground in Ohio and Pennsylvania. And other unions are interested too. It is a relatively new idea for organized labor to begin building businesses, and they have a lot of people watching, so they are taking care to make their first ventures a shining success. Unlike in the Mondragon Cooperatives, which are not unionized, the worker owners of these new union co-ops will be union members. And while the companies will be professionally managed, the managers will be under democratic supervision by the workers, where the union helps represent the needs and desires of the rank and file. Like Mondragon, these companies will emphasize not just short-term profit but also long-term job creation and sustainability.
Mark Karlin: Cynics argue that American workers have been conditioned to the managerial profit-making system and are resistant to the cooperative concept. How do your respond to that perception?
Mark Dworkin: I agree that we learn from an early age to navigate hierarchical social structures, and we have lots of practice competing, though little practice cooperating. So we have a lot to learn in order to make cooperatives a success. But I think many people are willing to make the effort. We have participatory instincts that are stifled in the dominant economy. I remember one friend who lit up when I told him that in worker cooperatives, people are encouraged to put forward their ideas about how to make the company better. That's sure different, he said; everywhere I have ever worked you're best off if you keep your head down and your mouth shut. So I wouldn't say that workers are resistant to cooperation, but rather our cooperative instincts are suppressed and trained out of us. To help overcome this, all of the co-ops we visited place a high priority on initial training and ongoing leadership development of their members.
Mark Karlin: Truthout has been excerpting Gar Alperovitz's book, America Beyond Capitalism: Reclaiming Our Wealth, Our Liberty and Our Democracy. How are cooperatives representative of economic models of democracy?
Mark Dworkin: Gar Alperovitz and The Democracy Collaborative that he helped to found are key designers of the Evergreen Cooperatives, and I have enormous respect for Gar's thinking and his work. One thing that the Democracy Collaborative talks about is how we are proud to live in a democracy, yet when we go to work, most people in the US have to check their democracy at the door. Cooperative companies are run democratically in terms of their day-to-day operations, and economic democracy in their home region is enhanced, because strategic decisions with long-term consequences for the region are made democratically by people who live and work there, and share a commitment to future sustainability.
Mark Karlin: Do you see evidence that the cooperative movement is gaining momentum in the United States?
Mark Dworkin: Cooperatives are taking off, especially in the last few years when economic conditions have been desperate and more people have been willing to think outside of the box. But it doesn't mean they will all succeed. Such change doesn't happen overnight. New cooperatives like other new businesses need a sound business strategy and plan, and they need the commitment and capital to keep going for the first few years as the business gets off the ground. But with the enthusiasm we have seen, we are optimistic. We've even heard reports that after viewing Shift Change people decided to try to form new co-ops or convert existing businesses to cooperatives.
Mark Karlin: How does democracy in the workplace, through worker ownership, have an impact on political democracy?
Mark Dworkin: Millions of people have become disenchanted with our political democracy, because they don't see how to get involved constructively and it is so hard to get things done. But when given the experience of running a business democratically, people develop their ideas and abilities and feel energized. We've heard numerous stories of co-op worker/owners gaining confidence in their thinking and becoming more involved in social movements and civic affairs. Worker cooperatives are living laboratories of democracy, and democracy is contagious - it cannot help but spill over from the job to life outside of work.
Mark Karlin: In 2012, You and Melissa Young also completed a documentary, We Are Not Ghosts, on the community-based effort to revitalize Detroit. Do you see hope for the development of cooperatives in a city such as Detroit, left in ruins by the flight of manufacturing jobs?
Mark Dworkin: The grass-roots efforts we profile in Detroit involve a lot of community-based cooperation. For the most part it has not yet taken a business form, although Ghosts does visit a very successful bakery that has helped revitalize a run-down neighborhood and a small bicycle repair shop that is a worker co-op. Detroiters are rethinking what a post-industrial city should be like, grounding their efforts in neighborhoods and addressing immediate needs - such as growing food in empty lots, creating spoken word and visual art, organizing neighborhood efforts to reduce violence, etc. So in We Are Not Ghosts we were more interested in the content of what is happening in Detroit - in spite of reports from the major media that focus on shuttered factories, abandoned houses and white flight - rather than its organizational form: non-profit, small business or co-op business. Having said that, the spirit of cooperation is strong. People remaining in Detroit love their city and are committed to working hard and helping it to survive. As Detroit spoken-word poet Jessica Care Moore says in the film, "Somebody's got to tell them. We are not ghosts! We are in this city, and we are alive!"
Mark Dworkin and his partner Melissa Young founded Moving Images. They have produced and directed more than 20 progressive social documentaries. Many of these programs have aired across North America on PBS, and they are widely distributed to schools, libraries and community organizations.
Copyright, Truthout.
"I freed a thousand slaves I could have freed a thousand more if only they knew they were slaves."
Harriet Tubman
Worker Self-Directed Enterprises
http://www.democracyatwork.info/
Democracy at Work is a project, begun in 2010, that aims to build a social movement. The movement’s goal is transition to a new society whose productive enterprises (offices, factories, and stores) will mostly be WSDE’s, a true economic democracy. The WSDEs would partner equally with similarly organized residential communities they interact with at the local, regional, and national levels (and hopefully international as well). That partnership would form the basis of genuine participatory democracy.
Utilizing media, from short video clips that go viral to our already well-established weekly and increasingly syndicated “Economic Update” radio program (WBAI, 99.5 FM, New York) and from podcasts to articles to blogs, this interactive website reaches and engages a fast growing audience.
Open to and interested in democracy at work, that audience also wants to move actively with beyond today’s dysfunctional economic and political systems while mindful of mistakes made by earlier efforts to go beyond capitalism. This interactive website will serve as the central location for these forms of media, a database of research and resources that support and strengthen the movement, and the open discussions shaping that movement as it grows. We begin with a definition of workers’ self-directed enterprises. In some ways, they are similar to co-ops, worker owned enterprises, and other organizations of production that reject the old, top-down, hierarchical capitalist model. Yet in crucial ways, workers’ self-directed enterprises are also unique.
Workers’ Self-Directed Enterprises (WSDE’s): WSDE’s are enterprises in which all the workers who collaborate to produce its outputs also serve together, collectively as its board of directors. Each worker in any WSDE thus has two job descriptions: (1) a particular task in the enterprise’s division of labor, and (2) full participation in the directorial decisions governing what, how and where to produce and how to use the enterprise’s surplus or profits.
Simply put, in place of a hierarchical, undemocratic, capitalist production organization giving those decisions exclusively to a small minority – major shareholders and the board of directors – WSDE’s institutionalize democracy at work as the economy’s central principle and society’s new foundation.
We believe that now is the time for a comprehensive new strategy and new movement for social change. We invite you to join with Democracy at Work to work toward those goals.
From Occupation to Co-operation
http://www.austinchronicle.com/news/2013-01-25/from-occupation-to-co-operation/
Co-op Think Tank organizes to expand member-owned movement
By Robyn Ross, Fri., Jan. 25, 2013
They called it "breaking up with your bank."
At the height of the Occupy movement in 2011, more than 700,000 people nationwide moved their savings from institutions like Bank of America to credit unions. Besides offering more competitive rates, credit unions are in principle democratically governed, owned by their customers. The one-person-one-vote egalitarianism and cooperative structure of credit unions appeals to people tired of banks structuring loans and imposing fees to profit distant shareholders, as well as to those who objected to the role of major national banks in creating the conditions that led to the nationwide recession.
A group of Austinites is proposing to sustain that cooperative spirit and expand it to other sectors of the economy. "With Occupy Wall Street," says Mark Wochner, a board member at both Wheatsville Food Co-op and Black Star Co-op Pub and Brewery, "people were asking for an alternative model that was focused on the individual, the community, and being good for the environment. For hardcore co-op people, it's like, 'We're right here.'"
The "hardcore co-op people" constitute the Austin Co-op Think Tank, which this weekend is hosting the Austin Cooperative Summit, a conference focused on developing co-ops in Central Texas. Conference organizer Kim Penna, who works at College Houses, says the project involves both regional strategic planning and public education about co-ops. "Co-ops are a proven answer to the questions that people were asking during Occupy," she says. "'Why don't we have more of a voice? Why are outside forces dictating the jobs we can get?' Co-ops answer those problems. If there isn't a job for you, you can create a worker co-op and create a job – take back your voice."
The co-op is an economic enterprise democratically run by members or employees. Members own and govern the co-op, with each person who makes a basic, defined contribution having one share and one vote. While national co-ops exist – REI, Ocean Spray, Blue Diamond nuts – most co-ops, by nature, are local businesses.
"The members are not people who live 2,000 miles away who have the investment as part of their pension fund," Wochner says. "They are people who shop at the co-op or people who work there. The wealth either goes to people that work there, or it's reinvested in the community or the co-op, or given to the members."
The primarily local, democratic nature of co-ops makes them an appealing alternative to Wall Street capitalism. Jim Jones, a lifelong co-op activist who worked in Austin in the late Seventies and early Eighties, puts it this way: "Instead of trying to pressure the government or employer to do something differently, you simply say, 'We'll try to do it ourselves.'"
The Think Tank isn't Austin's first cooperative brain trust. Austin's first housing co-ops were formed during the Depression, and by the Seventies, they had become an integral part of campus-area culture. In 1977, the co-op community hosted a national cooperatives conference, and afterward, members of the different local co-ops wanted to keep meeting and maintain momentum. They formed the Austin Co-op Link, which produced educational events until it dissolved almost 20 years later, when individual co-ops facing financial hardship had to focus on their own survival.
The Link is one aspect of Austin's co-op history featured in a film documentary in progress produced by Jones, who worked in housing co-ops and helped found Wheatsville. (A short preview will be shown at the summit.)
Like the post-Occupy present, the Seventies were a time of social upheaval and questioning established systems. "You typically see spikes in cooperative activity and in labor activity around periods of crises," says Carlos Perez de Alejo of Cooperation Texas, which helps organize worker co-ops. "People are recognizing that business as usual is not working and are more open to what an alternative might look like."
Practical Hurdles
But if co-ops address so many economic and political problems, why aren't there more of them?
For starters: money.
Most businesses begin with capital drawn from major investors or lenders, pulled from savings, borrowed from friends or family, or raised through stock offerings. People who want to start co-ops – particularly worker co-ops – often don't have access to these resources, and co-ops can't sell stock.
Traditional lenders are often leery of the co-op model because its egalitarianism is seen as risky. Most banks are used to dealing with a single owner of a business to negotiate and secure a loan and aren't comfortable working with a co-op's multiple owners.
Cooperatively structured credit unions would seem to be the logical solution, but hurdles exist there, too. The same policies that make credit unions more stable than conventional banks limit the loans they can make. They mostly lend only from their own deposits, and they're limited to lending 12.25% of their assets to commercial enterprises, narrowing the opportunities for financing co-ops.
Some local co-ops have solved the capital problem creatively: Red Rabbit Cooperative Bakery started its operation with $10,000 raised through a Kickstarter campaign. Black Star Co-op spent several years collecting investing members at beer socials before Wheatsville invested the last $50,000.
A new business also needs legal services and accounting, but co-ops' options are again restricted by service providers' unfamiliarity with the co-op model. Business attorneys who don't understand how to start a co-op, for example, might encourage entrepreneurs to form a limited liability corporation instead.
"Co-ops require the same kind of assistance 'regular' businesses get – financial services, legal services, marketing, technical assistance, training, and education," says Perez de Alejo. He cites the success of the Mondragon cooperatives in the Basque region of Spain and a network of co-ops in the Emilia Romagna region of northern Italy. In both places, there are support organizations whose primary purpose is to develop cooperatives. "That's the kind of infrastructure we need to think about building here in Austin and Texas, if we're serious about taking things to scale and moving them forward for the long term," he says.
The Think Tank hopes to use this weekend's summit in part to reach other service providers who'd like to work with co-ops. Some members dream of one day seeing legal and accounting co-ops that offer their services to others in the co-op community.
What Goes Around ...
In April 2010, Kelsey Balcaitis, a youth financial education coordinator at A+ Federal Credit Union, organized a workshop to help employees understand the cooperative model, inviting representatives from Wheatsville and Black Star. "We talked about values and principles a lot – how do our owners see us, what are the individual challenges we face," recalls Rose Marie Klee, president of Wheatsville's board. "We realized at some point that this was not the only conversation we should have."
The group continued to meet and add members, eventually calling itself the Austin Co-op Think Tank. In August 2011 it held a retreat to brainstorm a five-year plan for helping co-ops "go mainstream" in Austin. One step toward that goal is getting the Austin community to see all the different co-ops – housing, producer, consumer, worker, utility – as connected. "If you have very successful independent co-ops that everybody thinks of separately," Jones says, "you'll never get that sense of it being more than a business. If you start thinking of it as a way of doing things – rather than a particular place of business – then it has the potential for becoming mainstream."
To that end, the Think Tank developed a mentorship program that paired co-op newbies with seasoned professionals. Piggybacking on the United Nations' naming of 2012 the International Year of Cooperatives, the group worked with the City Council to amplify the proclamation locally.
So far, much of the value of the Think Tank has been in building relationships among people in different co-ops. Because of connections made at Think Tank meetings, Wheatsville lent its boardroom to College Houses for a training program, and the Inter-Cooperative Council financed a fire sprinkler system in its older houses through University Federal Credit Union.
Wheatsville sells Red Rabbit doughnuts; Black Star uses Red Rabbit bread. The ICC housing co-ops have been Wheatsville's biggest customers for years. Think Tank members would like to see these networks expand; what about a cooperative cleaning or pest control or laundry service that could be used by Wheatsville, Black Star, and other co-ops?
"I think we're underambitious in this country," says Brian Donovan, the general administrator of the ICC. He points to the International Co-operative Alliance's goal to make co-ops the fastest-growing business model by 2020. He'd like to see more co-ops in day care, housing, energy – services where consumers need stability.
"People with a lot of capital in Wall Street can make money whether the stocks go up or down," Donovan says. "The only time they're not making money is when it's stable – so the vested interest is in instability. But in the co-op, stability is the goal. When things go bad in a co-op, you make adjustments to survive – you don't fold and declare bankruptcy or sell to a competitor. So I think we could provide these long-term services for ourselves, instead of having profit-motivated or instability-motivated, investor-owned companies running them."
The collaboration among Austin's coops – whether they brew beer, sell groceries, print T-shirts, or provide housing – are what Jones thinks will propel the local cooperative economy forward. He describes the current scene as a "golden age" for Austin, akin to the Seventies. "In both instances there was a social system that was open-ended and allowed people to become involved easily. If you look at who's involved in the Think Tank, it's not all the managers or staff or presidents of the board – it's whoever's interested. It lets people get involved without running for a board or getting hired."
For Perez de Alejo, that open social system allows existing co-ops to find common ground that will be essential for expansion to occur. "Typically, different types of co-ops operate in their silos and don't communicate much with one another," he says. "With the Think Tank, we're beginning that conversation and trying to figure out where we can lock arms and think about the future together."
The Politics of Debt in America: From Debtor’s Prison to Debtor Nation
Tuesday, 29 January 2013 10:24 By Steve Fraser, TomDispatch | News Analysis
http://truth-out.org/news/item/14202-the-politics-of-debt-in-america-from-debtors-prison-to-debtor-nation
Debt and the Birth of a Nation
Nowadays, the conservative media inundate us with warnings about debt from the Founding Fathers, and it’s true that some of them like Jefferson -- himself an inveterate, often near-bankrupt debtor -- did moralize on the subject. However, Alexander Hamilton, an idol of the conservative movement, was the architect of the country’s first national debt, insisting that “if it is not excessive, [it] will be to us a national blessing.”
As the first Secretary of the Treasury, Hamilton’s goal was to transform the former 13 colonies, which today we would call an underdeveloped land, into a country that someday would rival Great Britain. This, he knew, required liquid capital (resources not tied up in land or other less mobile forms of wealth), which could then be invested in sometimes highly speculative and risky enterprises. Floating a national debt, he felt sure, would attract capital from well-positioned merchants at home and abroad, especially in England. However, for most ordinary people living under the new government, debt aroused anger. To begin with, there were all those veterans of the Revolutionary War and all the farmers who had supplied the revolutionary army with food and been paid in notoriously worthless “continentals” -- the currency issued by the Continental Congress -- or equally valueless state currencies.
As rumors of the formation of a new national government spread, speculators roamed the countryside buying up this paper money at a penny on the dollar, on the assumption that the debts they represented would be redeemed at face value. In fact, that is just what Hamilton’s national debt would do, making these “sunshine patriots” quite rich, while leaving the yeomanry impoverished. Outrage echoed across the country even before Hamilton’s plan got adopted. Jefferson denounced the currency speculators as loathsome creatures and had this to say about debt in general: “The modern theory of the perpetuation of debt has drenched the earth with blood and crushed its inhabitants under burdens ever accumulating.” He and others denounced the speculators as squadrons of counter-revolutionary “moneycrats” who would use their power and wealth to undo the democratic accomplishments of the revolution.
In contrast, Hamilton saw them as a disinterested monied elite upon whom the country’s economic well-being depended, while dismissing the criticisms of the Jeffersonians as the ravings of Jacobin levelers. Soon enough, political warfare over the debt turned founding fathers into fratricidal brothers.
Hamilton’s plan worked -- sometimes too well. Wealthy speculators in land like Robert Morris, or in the building of docks, wharves, and other projects tied to trade, or in the national debt itself -- something William Duer and grandees like him specialized in -- seized the moment. Often enough, however, they over-reached and found themselves, like the yeomen farmers and soldiers, in default to their creditors.
Duer’s attempts to corner the market in the bonds issued by the new federal government and in the stock of the country’s first National Bank represented one of the earliest instances of insider trading. They also proved a lurid example of how speculation could go disastrously wrong. When the scheme collapsed, it caused the country’s first Wall Street panic and a local depression that spread through New England, ruining “shopkeepers, widows, orphans, butchers... gardeners, market women, and even the noted Bawd Mrs. McCarty.”
A mob chased Duer through the streets of New York and might have hanged or disemboweled him had he not been rescued by the city sheriff, who sent him to the safety of debtor’s prison. John Pintard, part of the same scheme, fled to Newark, New Jersey, before being caught and jailed as well.
Sending the Duers and Pintards of the new republic off to debtors’ prison was not, however, quite what Hamilton had in mind. And leaving them rotting there was hardly going to foster the “enterprising spirit” that would, in the treasury secretary’s estimation, turn the country into the Great Britain of the next century. Bankruptcy, on the other hand, ensured that the overextended could start again and keep the machinery of commercial transactions lubricated. Hence, the Bankruptcy Act of 1800.
If, however, you were not a major player, debt functioned differently. Shouldered by the hoi polloi, it functioned as a mechanism for funneling wealth into the mercantile-financial hothouses where American capitalism was being incubated.
No wonder debt excited such violent political emotions. Even before the Constitution was adopted, farmers in western Massachusetts, indebted to Boston bankers and merchants and in danger of losing their ancestral homes in the economic hard times of the 1780s, rose in armed rebellion. In those years, the number of lawsuits for unpaid debt doubled and tripled, farms were seized, and their owners sent off to jail. Incensed, farmers led by a former revolutionary soldier, Daniel Shays, closed local courts by force and liberated debtors from prisons. Similar but smaller uprisings erupted in Maine, Connecticut, New York, and Pennsylvania, while in New Hampshire and Vermont irate farmers surrounded government offices.
Shays' Rebellion of 1786 alarmed the country’s elites. They depicted the unruly yeomen as “brutes” and their houses as “sties.” They were frightened as well by state governments like Rhode Island’s that were more open to popular influence, declared debt moratoria, and issued paper currencies to help farmers and others pay off their debts. These developments signaled the need for a stronger central government fully capable of suppressing future debtor insurgencies. Federal authority established at the Constitutional Convention allowed for that, but the unrest continued. Shays' Rebellion was but part one of a trilogy of uprisings that continued into the 1790s. The Whiskey Rebellion of 1794 was the most serious. An excise tax (“whiskey tax”) meant to generate revenue to back up the national debt threatened the livelihoods of farmers in western Pennsylvania who used whiskey as a “currency” in a barter economy. President Washington sent in troops, many of them Revolutionary War veterans, with Hamilton at their head to put down the rebels.
With New Constitution, Post-Collapse Iceland Inches Toward Direct Democracy
Sunday, 27 January 2013 07:10 By Sam Knight, Truthout | News Analysis
http://truth-out.org/news/item/14097-with-new-constitution-post-collapse-iceland-inches-toward-direct-democracy
When the global financial system crumbled over four years ago, Iceland played host to one of the most dramatic economic collapses in modern history. Its three largest banks were unable to refinance debt roughly ten times the size of the country's gross domestic product (GDP), causing one of the world's wealthiest nations to limp with hat in hand to the International Monetary Fund (IMF). The island became a symbol for capitalism's systemic failure.
Now, Iceland is making headlines for more positive reasons: activists there are in the process of advancing some of the strongest freedom of information laws and journalist protections in the world, and the Icelandic economy, while still beset by problems, is significantly outperforming other crisis-stricken countries.
Most recently, on October 20, a remarkable constitution - written by an elected council with help from the public - took a step closer toward ratification after it was approved in a referendum by a 2-1 margin.
Before the changes are signed into law, the draft must be approved by the Althingi, Iceland's Parliament, approved again by referendum and finalized once more by the legislature after a fresh parliamentary election in April.
Uncertainty is swirling around the status of the constitution, however. Those opposed to it - primarily right-wingers - claim that the 48.9 percent turnout for October's vote doesn't lend the document legitimacy. There is also fear among the constitution's supporters in Parliament that some of their colleagues are trying to abrogate the public's influence by altering the document's content instead of offering the technical revisions they were given the mandate to make. "I truly believe that our democracies have been hijacked by bureaucrats," said Parliamentarian Birgitta Jónsdóttir, a self-described "realist-anarchist" elected after the Kitchenware Revolution protests which ensued following the 2008 financial crisis forced the long-ruling conservative government to resign in 2009. "I don't want the new constitution to be plagued with their language, but the language of the people," she insisted in a Skype conversation with Truthout. "Their time is over. They just can't get over it." It's unsurprising that inertia is casting a pall over the constitution's future. In January 2011, the constitutional council's election was controversially nullified by Iceland's Supreme Court. Parliament effectively overruled this decision by appointing the 25 candidates who received the most votes to take seats on the council to rewrite the constitution.
Regardless of the document's final status, the drafting process - inspired by crowdsourcing techniques - has produced a remarkably progressive legal code and generated significant interest from around the world.
"A PBS TV crew of seven or eight followed a group of us around the north of the country before the [October] vote," Thorvaldur Gylfason, an economics professor and member of the constitutional council, told Truthout. (The footage will be part of a four-hour series on the US Constitution set to air in May.)
At home, supporters are hoping that the constitution can create more momentum for innovative reform. Information technology specialists who opened the drafting process to the public through social media are expecting to set up open data projects in partnership with the government. There has also been another web-based open government reform in the city of Reykjavik: the city council passed a law forcing it to consider 16 citizen-initiated proposals made each month through a web site called "Betri Reykjavík" (Better Reykjavik). There has been talk among its boosters that the constitution could mark the beginning of a gradual movement toward direct democracy. But to better understand the significance and global appeal of the new constitution, it is worth discussing the state of Iceland's economy, which has defined both the constitutional movement and international scrutiny of the diminutive subarctic nation since 2008.
A Shining Beacon of Post-Collapse Economics?
According to bloggers, Facebook memes and some prominent commentators, Iceland is the shining beacon of post-collapse economics.
Their narrative paints a picture of the government, emboldened by protest movements, refusing to be held to the fire for the mistakes of rapacious financiers and corrupt politicians, even sanctioning them for crash-related misdeeds. At least seven bankers have been charged with criminal offenses so far - two were recently sentenced to nine months in prison. Those indicted include the once powerful investor Jón Ásgeir Jóhannesson, who was charged in December with illegally securing loans worth around $50 million. And former Prime Minister Geir Haarde was found guilty of not holding cabinet meetings on important issues - one of four charges brought against him - although the verdict didn't warrant any jail time. This justice has supposedly left the country less burdened by debt and a domineering financial sector that crowded out sustainable industries.
But like most political memes bandied about on the Internet, this overly optimistic commentary must be critically examined. Iceland is faring better than most countries hit hard by the global meltdown. Write-downs and debtor revolts have undeniably mitigated the consequences of collapse.
Citizens, through referenda brought on by presidential vetoes, rejected Parliament's plan to pay billions of dollars claimed by the British and Dutch governments after one of Iceland's three major banks, Landsbanki, saw its cross-border savings scheme, known as Icesave, fail.
The establishment - perhaps influenced by widespread protests that followed the crisis - has also been somewhat attentive to the plight of debtors. The Supreme Court ruled that loans indexed to foreign currencies - commonly issued during the boom, but rendered absurdly expensive after the krona collapsed - were, in fact, illegal, significantly reducing mortgage principals overnight. The government also announced a plan in December 2010 to cap distressed homeowners' mortgage principals at 110 percent of estimated home values. According to a financial industry-backed report published last February, Icelandic banks, since the end of 2008, have forgiven debt equivalent to 13 percent of GDP.
The government also didn't directly bail out the three major banks - Kaupthing and Glitnir being the other two - but nationalized them (albeit momentarily - more on that later). And crucially, it eschewed sweeping austerity that the IMF typically favors - a strategy that seemingly paid off, as Iceland exited the IMF program in the summer of 2011.
It appears these developments have given Iceland's economy room to grow. The unemployment rate in October was at 4.5 percent, and the country's GDP grew by 3.1 percent in 2011, according to Statistics Iceland. Fairly impressive when considering eurozone misery.
There are also explanations for Iceland's performance that are less dramatic than frenzied demonstrations and white-collar prosecutions. Emergency capital controls have prevented a total collapse of the krona. Some post-crisis years saw net emigration, relieving the labor market of excess supply. The defunct banks invested in assets, like British retail chains, that largely retained value after the global bust - a significant amount of their debts could be covered by liquidating these assets. Finally, the post-collapse devaluation of the krona has made Icelandic commodities more competitive on global markets, giving the country the trade surplus it desperately needs to amass foreign currency.
But the lionization of Iceland glosses over persistent systemic problems.
"Look at what's happening in Europe. The crisis is much deeper and harder in Greece and other countries. It's just horrifying," Jónsdóttir said.
"But," she warned, "we could end up exactly like that."
Cooperatives and Community Work Are Part of American DNA
Tuesday, 22 January 2013 16:28 By Kevin Zeese and Margaret Flowers , Truthout | Op-Ed
http://truth-out.org/opinion/item/14076-cooperatives-and-community-work-are-part-of-american-dna
There is so much in US history that has been hidden or mythologized that ignorance is more common than knowledge even among the best informed. That is how we felt when we read For All the People and then interviewed the author, John Curl, on Clearing the FOG radio.
Curl's area of expertise is very important for those of us seeking transformational change to a new, more equitable economy and participatory democracy. His book methodically and authoritatively traces the hidden history of cooperatives, cooperation and communalism in US history. He shows how these models of economic democracy were intertwined with many of the transformational changes the country has made, including breaking from English empire, ending slavery, and gaining women's suffrage, worker rights and union rights, as well as civil rights. He also shows how economic democracy has been in constant battle with concentrated-wealth-based capitalism, which is threatened by a more equal distribution of wealth. This history is critical for advocates to understand; therefore, For All the People is essential reading.
Why Cooperatives, Cooperation and Communalism Matter
Creating transformational change is not only about protesting what we do not like and resisting and refusing to cooperate with the power structure; it also requires us to simultaneously build the world we want. If big-finance capitalism does not serve the people, what will? The mass of people who struggle through their daily lives need to know there is an alternative available that will meet their needs and improve their lives. People who urgently require employment, housing, food and other immediate needs can work together now to solve their problems in ways that also undermine big-finance capitalism and build democratic and sustainable systems.
Changing the economic system to one that is more democratic is fundamental to shifting political power away from concentrated wealth and to people. However, decentralized and democratic economic systems will not address all of the crises that exist sufficiently. Some, such as finance, health care, energy, climate and transportation require national approaches and coordination. When political power begins to shift, these bigger solutions can be put in place and greater transformation will be possible.
History reinforces the idea that to achieve transformational change, we must proceed on twin tracks: protesting and building. Mahatma Gandhi changed his emphasis in the mid-1930s, a dozen years before independence from the British Empire, to work focused on building economically self-reliant communities from below (sardovaya, or social uplift for all). This became an adjunct to the strategy he is most known for, satyagraha (noncooperation and civil disobedience to unjust laws). Gandhian economics meant thousands of self-sufficient small communities with self-rule and the need for economic self-sufficiency at the village level joined together in a cooperative federation of village republics. This is bookended by the Gandhian social ideal of dignity of labor, equitable distribution of wealth, communal self-sufficiency and individual freedom.
We discovered this two-path necessity when we were organizing the Occupation of Washington, DC at Freedom Plaza. We learned that change required a strategy of two parts: protesting what we oppose, and building what we want; to make the goals of the occupation clear, we called it Stop the Machine, Create a New World. The latter approach is important for many reasons and deserves more attention than the former because it builds community, solves urgent problems, builds wealth for individuals and communities, and creates the society we want.
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Spain's Rebellion Moves to Print
Thursday, 24 January 2013 00:00 By Michael Levitin, Truthout | Report
http://truth-out.org/news/item/14102-spains-rebellion-moves-to-print
Cooperatively owned by journalists and readers, Spain's radical new monthly magazine, La Marea, is committed to democratic regeneration and aims to reach people with sober language and militant ideas.
Ownership, Full Employment and Community Economic Stability
Wednesday, 23 January 2013 11:50 By Gar Alperovitz, Back to Full Employment | Op-Ed
http://truth-out.org/opinion/item/14091-ownership-full-employment-and-community-economic-stability
Limiting market share would limit freedom of both the consumer and the business. I've been a CPA for 20 years and most small business owners are real assholes who don't comply with regulations and the law. Michael Moore has said the same thing many times. The consumer would be limited because once a business reaches 33% market share he wouldn't be able to support the business of his choosing. Also businesses are able to produce greater quality at greater prices when it can use scale.
Socialism works, communism doesn't. The government doesn't need to create laws to champion worker cooperatives, it just needs to provide incentives for them. One tweak to the Small Business Administration which states that certified worker self directed enterprises get funding.
Banking doesn't need to be change except for the reestablishment of Glass / Stegall. We just need regulators to enforce the laws on the books and hire more people. I've personally had a certified fraud examination license, an MBA and a CPA for over 6 months and have not had one interview to be a regulator, investigator or examiner.
The only way limiting the collective market share of the formula businesses would prevent consumers from supporting the businesses of their choice is if the consumers' patronage of the 66% local businesses were to for some reason drastically decline.
It would be great if the government provided incentives for worker cooperatives but the primary support needs to come from the people themselves as anything that is government dependent can be undermined by reduced support.
Banking definately needs to change. Credit unions for the people and public banks for the states forming a Union Reserve Bank. The public's money in private hands has never turned out for the best.
http://occupywallst.org/forum/free-democracy-amendment/#comment-751774
http://occupywallst.org/forum/free-democracy-amendment/#comment-751508
http://occupywallst.org/forum/free-democracy-amendment/#comment-755697
http://occupywallst.org/forum/free-democracy-amendment/#comment-748866
http://occupywallst.org/forum/free-democracy-amendment/#comment-756693
New Cuba: Beachhead for Economic Democracy Beyond Capitalism
Thursday, 17 January 2013 00:00 By Keith Harrington, Truthout | Op-Ed
http://truth-out.org/opinion/item/13918-the-new-cuba-a-beachhead-for-economic-democracy-we-should-support
The year 2012 may have been the United Nation's International Year of Cooperatives, but 2013 may turn out to be the more historic year for worker-ownership if the Cubans have anything to say about it.
To listen to the mainstream American media, however, you'd never know it. As a video supplement to a recent New York Times article makes clear, the corporate press has already made up its mind on how the story of Cuba's economic liberalization is bound to end: "In a state defined by all-consuming communism for the past 50 years, capitalist change comes in fits and starts, and only at the pace that the government is willing to allow."[Emphasis added]
In other words, Cuba's post-communist story ends just like China's - in capitalism, because according to orthodox dogma, there's nowhere else to go. Trapped by the limited possibilities of this dichotomist capitalism-or-communism mentality, mainstream commentators lack the perspective needed to appreciate (much less inform others) that a transition away from a state-dominated command economy might conceivably lead to a type of market that is very distinct from our elite-shareholder-dominated and profit-fixated capitalist model.
But that is precisely the nuanced story we find in Cuba when we dig just below the surface and consider the very guidelines the Cuban government has adopted to steer the transition process. Since the state unveiled its nuevos lineamientos or new guidelines for economic development in 2010, the easing of government restrictions on private entrepreneurial activity has only constituted a single aspect of a much broader picture of change. Unfortunately, The New York Times and its ilk have gotten so hung up on the privatization shift, that they've left out crucial details about the types of private enterprises the Cuban government is attempting to foster.
Specifically, the government is placing high priority on the development of worker-owned-and-managed firms and has recently passed a law intended to launch an experimental cadre of 200 such firms. Under the law, workers - rather than government bureaucrats or elite boards of directors - will democratically run the businesses, set their own competitive prices, determine wages and salaries and decide what to do with the profits they generate. In other words, Cuba's new worker cooperatives will operate pretty much along the same lines as their successful cousins in the capitalist world, including Spain's Mondragon Cooperative Corporation.
But what sets the Cuban cooperative experiment apart and renders it such an incredible opportunity for the global worker-cooperative movement, is its occurrence in a political-economic milieu that is currently free from the distorting effects of capitalist competition. This is significant because while cooperatives have proven just as competitive as capitalist firms in a capitalist context, when capitalist profits and growth assume top priority, worker-owned firms may be compelled to act more like capitalist firms and subordinate core objectives such as worker empowerment and well-being, community development and environmental sustainability. Indeed, as cooperatives grow, even the percentage of actual worker owners in their ranks has been known to decline, as we've seen with Mondragon.
In short, the worker-ownership movement could greatly benefit from a national-scale economic environment that will allow cooperative enterprises to develop according to their own particular democratic nature and exhibit their true potential, free from the profit-above-all dictates of capitalism. No country bears as much promise in this respect than contemporary Cuba.
Nevertheless, for Cuba's experiment to work, all efforts should be made to steer the economy and the behavior of the country's emergent private entrepreneurial class in a direction that comports with the ethos and objectives of economic democracy. Above all, this would likely require severe restrictions, if not an outright ban, on the entry of large foreign capitalist firms or the establishment of large domestic capitalist firms. For, as economists such as Jamee Moudud of Sarah Lawrence University and many structuralist thinkers have pointed out, as jobs and tax revenues become dependent on the success of capitalist firms, societies become constrained in their ability to pursue developmental paths that do not prioritize capitalist accumulation. Accordingly, during the early years of the cooperative experiment, Cuba should seek to limit foreign direct investment to cooperative or triple-bottom-line firms as much as possible, facilitate joint-ventures between such firms and its own cooperatives and continue to seek industrial loans largely from committed social democratic partners such as Venezuela, and other "pink-tide" trade partners.
Finally, the global cooperative movement must appreciate the historic, strategic importance of Cuba's experiment and mobilize its resources to support the effort. As observers of the situation have pointed out, Cuba's experience with worker cooperatives is limited primarily to its agricultural sector, and the establishment of a robust non-agricultural cooperative sector will require serious provision of training, technical support and worker acculturation. On this front, the experience of successful worker-ownership movements in Argentina, the United States, Spain and other countries could prove invaluable. Such assistance might be coordinated with the help of organizations such as Democracy at Work, the Democracy at Work Network, the Democracy Collaborative and the Working World, all of which specialize in helping worker cooperatives grow and thrive.
Of course, anyone can bolster this important beachhead for economic democracy by simply spreading the word and helping plug the gap in the media's coverage of Cuba's transition. Please help bust the myth that markets mean capitalism for the new Cuba by sharing this article and others cited here.
Copyright, Truthout.
When Democracy Is Trumped by the Excesses of Capitalism
Thursday, 10 January 2013 09:14 By Richard D Wolff, Haymarket Books | Book Excerpt
http://truth-out.org/progressivepicks/item/13812-when-democracy-is-trumped-by-the-excesses-of-capitalism
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The Foundation of a New Democratic Economy Is Worker Self-Directed Enterprises
Thursday, 10 January 2013 15:02 By Kevin Zeese and Margaret Flowers , Truthout | Op-Ed
http://truth-out.org/opinion/item/13823-the-foundation-of-a-new-democratic-economy-is-worker-self-directed-enterprises
A commitment to democracy logically should extend to the place where adults spend most of their lives. Workers in control of their own workplaces are much less likely to ship their own jobs overseas, underpay employees or pollute their own communities.
The economic collapse and slow recovery that has led to high unemployment and under-employment, coinciding with an extreme wealth divide in which workers have a shrinking share of the GDP, means people are looking for new approaches. How can we create an economy that works for all Americans?
Through his new project, Democracy at Work, economist Richard Wolff strives to develop a social movement that puts in place a reorganization of the economy built on a foundation of employee control of the workplace. Employees would act together as their own bosses in a fully egalitarian, democratic workplace where workers run the business, share the assets and create a workspace that runs in harmony with not only its workers, but the entire community. We join him in this effort through our project, It's Our Economy, which seeks to create economic democracy, with worker ownership at its foundation. Economic democracy is consistent with the democratic ideals of the United States. And employee ownership is an all-American approach to problem-solving that has been supported by people on the Right and Left. Workers will relish the democratic structure; businesspeople will appreciate its entrepreneurial spirit. In our next column we will review the history of worker ownership and communalism that dates back to the founding of this country, indeed, pre-dates European settlement of North America.
We are not starting from scratch. There are thousands of successful, majority worker-owned businesses in the United States. The largest majority employee-owned business is Florida-based Publix Super Markets, a $27 billion company that employs 152,000 people. That's more workers than Costco and Whole Foods combined. As we finish the international year of the co-op, worker ownership is growing. One in five adults in the world are members of co-ops; and a majority of Americans find cooperatives to be less expensive, more trustworthy and to provide better service than traditional businesses.
As political economist Gar Alperovitz reports, "There are 120 million members of cooperatives in the United States; 20 percent of the American electric system is either co-op or municipal, essentially socialized. Land trusts are developing at the local level. At the state level, there are many approaches, like public pension funds, for example. California's is the most well-known, but the state of Alabama is heavily using its pension funds and even investing in some forms of worker-owned companies."
Wolff argues that workplaces need to go beyond majority ownership, to "Worker Self Directed Enterprises" (WSDE). He makes a strong case that workers in control of their own workplaces are much less likely to ship their own jobs overseas, underpay employees or pollute their own communities. As workers' enterprises become fully functioning, they benefit those who participate as workers as well as the customers and communities they serve.
Much of what goes wrong in US-European capitalism is due to how corporations are organized - hierarchical and undemocratic. As Wolff says "people go to work and do what they are told rather than participate." The undemocratic workplace is dominated by a handful of people - owners, stockholders or a board of directors. Those who make the decisions create greater wealth and power for themselves, usually at the expense of their workers; and not surprisingly they get involved in politics to ensure that they continue to keep their power and wealth.
Worker Self Directed Enterprises are a new way of organizing. Workers have the capacity to direct decisions in their workplace. As decision-makers they have to live with the decisions they make, like moving jobs overseas, replacing workers with technology or polluting their environment. Wolff says: "If we are committed to democracy, then the workplace where people spend most of their adult lives should be democratic."
Especially when an economy is not working, it is time to say "this system does not do what we need, we can do better." Throughout history, there has been a gradual move to self-governance. As Wolff notes, "We don't need kings, nor do we need to be governed by a few at the workplace." To accomplish this transition to a decentralized and democratized economy, we need to build a social movement that takes this message to the American people.
A large portion of the population already agrees with us. These ideas are majoritarian, but are not realized because wealth is in the hands of a few and politicians need concentrated wealth to sustain them and remain in office. This wealth also controls the media and limits discussion. Thus, we also need to continue building an independent, citizen's media to broaden discussion and understanding.
Worker Self Directed Enterprises are built on the experience of the worker cooperatives. The phrase WSDE is used to emphasize that workers make the decisions. The largest cooperative in the world is the Mondragon Cooperative - a network of 250 co-op enterprises that makes up the 7th largest corporation in Spain, with 85,000 worker-members who make the decisions. Mondragon defied the economic collapse in Spain. And now Mondragon is joining with US steelworkers to develop worker-owned steel mills in the US.
There is experience-based evidence that worker directed enterprises can have advantages over traditional corporate models. According to a study by Harvard and Rutgers researchers, companies with substantial employee ownership often outperform those without, because of lower staff turnover, stronger trust relationships at work and greater innovation.
The companies that succeed do so in large part because of the "innovation engine" that is unleashed by worker ownership. Group innovation is free fuel for a business that is created when people's passion is ignited toward innovating together and employees are engaged in creating better products and better ways to deliver them. This strategy seeks to create a competitive advantage in the marketplace.
What are the some of the keys to success? Research shows successful businesses realize that innovation comes from differences in thinking, therefore engaging many workers encourages innovation. Most of the time innovation does not mean new technology, but new solutions to problems, rearrangements and improvements in operation. Allowing experimentation, trying new approaches and sharing the lessons from these efforts means all can learn and innovate further. And success comes from sharing information not only with employees, but also with suppliers and customers. The entire organization is rewarded for its innovation and values of teamwork and sharing. Worker ownership is a practical, not utopian, model of organizing workplaces.
Changing the workplace is not only about more successful business; it is about people living more fulfilled lives. Wolff points out that many workers view work and workplaces negatively because they are not organized to be positive experiences for workers; that "Happy Hour" is something that takes place outside of work. "If more enterprises were employee-owned, fewer workers would face daily exploitation. The ratio of average CEO pay to worker pay (currently, an astounding 380:1) would shrink. Inequality, which harms society and hampers economic growth, would lessen."
Employee Self-Directed Enterprises will also change politics as they put democratic power in the workplace and build wealth among workers. As the balance of power shifts, majoritarian solutions to the challenges the country faces will no longer be taboo. The foundation of political democracy will move from a small number of owners, to worker directors thereby broadening the base of government. This article is based on a radio interview with Richard Wolff on Clearing the FOG (Forces Of Greed). You can listen to the interview here.
Copyright, Truthout.
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How We Can All Make Money Like the Billionaires
Thursday, 10 January 2013 14:49 By Thom Hartmann and Sam Sacks, The Daily Take | Op-Ed
http://truth-out.org/opinion/item/13843-how-we-can-all-make-money-like-the-billionaires
Political Football Over Disaster Relief: Another Argument for Public Banking
Friday, 04 January 2013 09:17 By Ellen Brown, Truthout | Op-Ed
http://truth-out.org/opinion/item/13701-political-football-over-disaster-relief-another-argument-for-public-banking
Post-Sandy and post-Katrina "disaster relief" has been characterized by more profit-taking by big business than relief to families and small businesses. The Bank of North Dakota demonstrated it doesn't have to be that way after flooding devastated Grand Forks in 1997.
In a shameless display of putting politics before human needs, Congress began 2013 still scrapping over a $60 billion Hurricane Sandy relief bill fully nine weeks after the disaster hit. And if the Katrina experience is any indication, the bill may not bring adequate relief to struggling and displaced homeowners even when it is finally passed.
The damage wrought by Sandy to New York and New Jersey coastal areas was similar in scale to that to New Orleans from Hurricane Katrina in 2005. Just two weeks after Katrina hit, Congress approved $62.3 billion in emergency appropriations, along with numerous subsequent emergency funding requests to cover the damages, which topped $100 billion. Yet as noted on the Occupy Sandy Facebook page, federal relief funds post-Katrina were gutted in favor of "privatizing and outsourcing relief, making room for predatory lenders, disaster capitalists, and gentrification developers." According to a report by Strike Debt, the vast majority of FEMA's resources and efforts are spent on public assistance programs that provide infrastructure restoration. Individual victims of disaster are for the most part just offered personal loans - loans that have many features of predatory subprime lending.
Disaster victims are now being expected to shoulder relief expenses that used to be shared publicly. Most people believe they are covered by their insurance policies or by the Federal Emergency Management Agency (FEMA), but many disaster victims have found that their insurance policies include obscure provisions that exclude coverage, and the only aid that FEMA gives to individuals is the opportunity to take on more debt.
It is a failing of our austerity-strapped federal disaster relief system that it can offer little real help to individuals; and it is a failing of our private, for-profit insurance system that the legal duty of management is to extort as much money as possible from customers while returning as little as possible to them, in order to maximize shareholder profits.
Most Sandy Victims Are Left Stranded
The report by Strike Debt was based on observations made at a community meeting in Midland Beach, Staten Island, on November 18, 2012, as well as on interviews with FEMA and Small Business Association (SBA) representatives, volunteer workers, local business owners, and residents throughout New York City. According to the report, there are three main sources of financial support being offered to Sandy victims: insurance, grants, and loans. Federal support is available only once private insurance has been exhausted. In many cases, residents who believed they had insurance that would cover the Sandy disaster are finding that, for a variety of reasons involving the fine print in the policies, their claims are being denied. Difficult-to-understand clauses allow insurers to deny coverage depending on such things as whether the storm was officially classified as a hurricane or a tropical storm.
For federal aid programs, according to the report:
Victims are required to first apply for loans before qualifying to apply for FEMA aid, placing the economic cost of the disaster on the individual victim.
Aid programs favor those who can take on debt, further exacerbating pre-existing inequalities among residents.
Federal programs are inflexible and fail to meet even basic individual and community needs.
Relief options are not clearly communicated or well understood. Policies are so complex that even lawyers are confused.
Except for temporary living costs, FEMA grants are accessible only after the homeowner, renter or business applies for an SBA loan. If the applicant qualifies for a loan, he or she is not likely to be provided further FEMA aid. Disaster loans are made through FEMA on the basis of credit history, and favorable interest rates are available only if the applicant cannot get credit elsewhere. That means favorable interest rates are offered only if an applicant cannot qualify for credit through a commercial bank. When the banks got in trouble themselves, the Fed dropped the Fed funds rate (the rate at which they borrow from each other) to nearly zero. But no such relief is extended to disaster victims.
There is no FEMA money for small businesses other than loans, and businesses have difficulty taking on debt when they don't know when they will be able to reopen. The small business application is reported to be at least 30 pages long, and is often difficult to complete because flooding has destroyed much of the required paperwork.
Many homeowners were strained by mortgages that were underwater prior to the storm, and their properties have now depreciated to the point of having no market value at all. They have no choice but to try to rebuild, but how can they take on more debt? The focus on lending, says the report, moves money from the victims of disaster into the hands of loan servicers, who make enormous profits off these loans.
A Better Model: Disaster Relief in North Dakota
That is the state of disaster relief in most parts of the country, but one state has developed a different model – North Dakota. North Dakota is the only state in the union to have its own state-owned bank. The Bank of North Dakota (BND) has a mandate to serve the public interest, and it has no shareholders other than the state itself. That gives it wide-reaching flexibility in emergencies, allowing it to act quickly to catalyze and coordinate resources.
The BND's emergency capabilities were demonstrated in 1997, when record flooding and fires devastated Grand Forks, North Dakota. The town and its sister city, East Grand Forks on the Minnesota side of the river, lay in ruins. Floodwaters covered virtually the entire city and took weeks to fully recede. Property losses topped $3.5 billion. The response of the state-owned bank was immediate and comprehensive, demonstrating a financial flexibility and public generosity that no privately-owned bank could match. Soon after the floodwaters swept through Grand Forks, the BND was helping families and businesses recover. Led by then-president and CEO John Hoeven (future North Dakota governor and US senator), the bank quickly established nearly $70 million in credit lines – to the city, the state National Guard, the state Division of Emergency Management, the University of North Dakota in Grand Forks, and for individuals, businesses and farms. It also launched a Grand Forks disaster relief loan program and allocated $5 million to help other areas affected by the spring floods. Local financial institutions matched these funds, making a total of more than $70 million available.
Besides property damage, flooding swept away many jobs, leaving families without livelihoods. The BND coordinated with the US Department of Education to ensure forbearance on student loans; worked closely with the Federal Housing Administration and Veterans Administration to gain forbearance on federally-backed home loans; established a center where people could apply for federal/state housing assistance; and worked with the North Dakota Community Foundation to coordinate a disaster relief fund, for which the bank served as the deposit base. The bank also reduced interest rates on existing Family Farm and Farm Operating programs. Families used these low-interest loans to restructure debt and cover operating losses caused by wet conditions in their fields.
To help finance the disaster recovery, the BND obtained funds at reduced rates from the Federal Home Loan Bank. These savings were then passed on to flood-affected borrowers in the form of lower interest rates.
The city was quickly rebuilt and restored. As a result, Grand Forks lost only 3% of its population between the 1997 floods and 2000, while East Grand Forks, right across the river in Minnesota, lost 17% of its population.
Bringing Real Security to Communities
Just as we can rely on our local public fire department to be there for emergencies, so a public bank can be relied on to lend a true helping hand when private banks, insurers, and FEMA may not. Unlike private insurers that are prone to withdrawing coverage on obscure technicalities, a publicly-owned bank is not beholden to shareholder profit-seeking; and unlike federal disaster relief agencies, a public bank is not dependent on a penny-pinching Congress for funds. Like private banks, it has the ability to create money in the form of bank credit on its books, and it has access to very low interest rates. But private banks have a business model that requires them to take advantage of these low rates to extract as much debt service as the market will bear. A public bank can pass these low rates on to disaster victims and local governments.
When the biggest private banks needed an emergency bailout, trillions of dollars in nearly-interest-free money came flooding their way. Why? As Sen. Dick Durbin said of Congress in 2009, "Wall Street owns the place.” The private banking industry also owns all twelve branches of the Federal Reserve. If we the people want the sort of security in emergencies that is available to Wall Street banks, we need to own some banks ourselves.
Just as Occupy Sandy has pre-empted the official rescue agencies through community organizing, so a Public Bank of New York or New Jersey could pre-empt the vulture Wall Street banks and finance the state's own rebuilding. Twenty states have now introduced bills of various sorts to establish their own banks. For more information on the campaign in your state, see here.
This piece was reprinted by Truthout with permission or license.
Discourse on Voluntary Servitude
The Discours sur la servitude volontaire of ÉTIENNE DE LA BOÉTIE, 1548
Rendered into English by HARRY KURZ
[Published under the title ANTI-DICTATOR]
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I see no good in having several lords; Let one alone be master, let one alone be king.
These words Homer puts in the mouth of Ulysses,[1] as he addresses the people. If he had said nothing further than "I see no good in having several lords," it would have been well spoken. For the sake of logic he should have maintained that the rule of several could not be good since the power of one man alone, as soon as he acquires the title of master, becomes abusive and unreasonable. Instead he declared what seems preposterous: "Let one alone be master, let one alone be king." We must not be critical of Ulysses, who at the moment was perhaps obliged to speak these words in order to quell a mutiny in the army, for this reason, in my opinion, choosing language to meet the emergency rather than the truth. Yet, in the light of reason, it is a great misfortune to be at the beck and call of one master, for it is impossible to be sure that he is going to be kind, since it is always in his power to be cruel whenever he pleases. As for having several masters, according to the number one has, it amounts to being that many times unfortunate. Although I do not wish at this time to discuss this much debated question, namely whether other types of government are preferable to monarchy,[2] still I should like to know, before casting doubt on the place that monarchy should occupy among commonwealths, whether or not it belongs to such a group, since it is hard to believe that there is anything of common wealth in a country where everything belongs to one master. This question, however, can remain for another time and would really require a separate treatment involving by its very nature all sorts of political discussion.
For the present I should like merely to understand how it happens that so many men, so many villages, so many cities, so many nations, sometimes suffer under a single tyrant who has no other power than the power they give him; who is able to harm them only to the extent to which they have the willingness to bear with him; who could do them absolutely no injury unless they preferred to put up with him rather than contradict him.[3] Surely a striking situation! Yet it is so common that one must grieve the more and wonder the less at the spectacle of a million men serving in wretchedness, their necks under the yoke, not constrained by a greater multitude than they, but simply, it would seem, delighted and charmed by the name of one man alone whose power they need not fear, for he is evidently the one person whose qualities they cannot admire because of his inhumanity and brutality toward them. A weakness characteristic of human kind is that we often have to obey force; we have to make concessions; we ourselves cannot always be the stronger. Therefore, when a nation is constrained by the fortune of war to serve a single clique, as happened when the city of Athens served the thirty Tyrants,[4] one should not be amazed that the nation obeys, but simply be grieved by the situation; or rather, instead of being amazed or saddened, consider patiently the evil and look forward hopefully toward a happier future.
Our nature is such that the common duties of human relationship occupy a great part of the course of our life. It is reasonable to love virtue, to esteem good deeds, to be grateful for good from whatever source we may receive it, and, often, to give up some of our comfort in order to increase the honor and advantage of some man whom we love and who deserves it. Therefore, if the inhabitants of a country have found some great personage who has shown rare foresight in protecting them in an emergency, rare boldness in defending them, rare solicitude in governing them, and if, from that point on, they contract the habit of obeying him and depending on him to such an extent that they grant him certain prerogatives, I fear that such a procedure is not prudent, inasmuch as they remove him from a position in which he was doing good and advance him to a dignity in which he may do evil. Certainly while he continues to manifest good will one need fear no harm from a man who seems to be generally well disposed.
But O good Lord! What strange phenomenon is this? What name shall we give to it? What is the nature of this misfortune? What vice is it, or, rather, what degradation? To see an endless multitude of people not merely obeying, but driven to servility? Not ruled, but tyrannized over? These wretches have no wealth, no kin, nor wife nor children, not even life itself that they can call their own. They suffer plundering, wantonness, cruelty, not from an army, not from a barbarian horde, on account of whom they must shed their blood and sacrifice their lives, but from a single man; not from a Hercules nor from a Samson, but from a single little man. Too frequently this same little man is the most cowardly and effeminate in the nation, a stranger to the powder of battle and hesitant on the sands of the tournament; not only without energy to direct men by force, but with hardly enough virility to bed with a common woman! Shall we call subjection to such a leader cowardice? Shall we say that those who serve him are cowardly and faint-hearted? If two, if three, if four, do not defend themselves from the one, we might call that circumstance surprising but nevertheless conceivable. In such a case one might be justified in suspecting a lack of courage. But if a hundred, if a thousand endure the caprice of a single man, should we not rather say that they lack not the courage but the desire to rise against him, and that such an attitude indicates indifference rather than cowardice? When not a hundred, not a thousand men, but a hundred provinces, a thousand cities, a million men, refuse to assail a single man from whom the kindest treatment received is the infliction of serfdom and slavery, what shall we call that? Is it cowardice? Of course there is in every vice inevitably some limit beyond which one cannot go. Two, possibly ten, may fear one; but when a thousand, a million men, a thousand cities, fail to protect themselves against the domination of one man, this cannot be called cowardly, for cowardice does not sink to such a depth, any more than valor can be termed the effort of one individual to scale a fortress, to attack an army, or to conquer a kingdom. What monstrous vice, then, is this which does not even deserve to be called cowardice, a vice for which no term can be found vile enough, which nature herself disavows and our tongues refuse to name?
Place on one side fifty thousand armed men, and on the other the same number; let them join in battle, one side fighting to retain its liberty, the other to take it away; to which would you, at a guess, promise victory? Which men do you think would march more gallantly to combat — those who anticipate as a reward for their suffering the maintenance of their freedom, or those who cannot expect any other prize for the blows exchanged than the enslavement of others? One side will have before its eyes the blessings of the past and the hope of similar joy in the future; their thoughts will dwell less on the comparatively brief pain of battle than on what they may have to endure forever, they, their children, and all their posterity. The other side has nothing to inspire it with courage except the weak urge of greed, which fades before danger and which can never be so keen, it seems to me, that it will not be dismayed by the least drop of blood from wounds. Consider the justly famous battles of Miltiades,[5] Leonidas,[6] Themistocles,[7] still fresh today in recorded history and in the minds of men as if they had occurred but yesterday, battles fought in Greece for the welfare of the Greeks and as an example to the world. What power do you think gave to such a mere handful of men not the strength but the courage to withstand the attack of a fleet so vast that even the seas were burdened, and to defeat the armies of so many nations, armies so immense that their officers alone outnumbered the entire Greek force? What was it but the fact that in those glorious days this struggle represented not so much a fight of Greeks against Persians as a victory of liberty over domination, of freedom over greed?
It amazes us to hear accounts of the valor that liberty arouses in the hearts of those who defend it; but who could believe reports of what goes on every day among the inhabitants of some countries, who could really believe that one man alone may mistreat a hundred thousand and deprive them of their liberty? Who would credit such a report if he merely heard it, without being present to witness the event? And if this condition occurred only in distant lands and were reported to us, which one among us would not assume the tale to be imagined or invented, and not really true? Obviously there is no need of fighting to overcome this single tyrant, for he is automatically defeated if the country refuses consent to its own enslavement: it is not necessary to deprive him of anything, but simply to give him nothing; there is no need that the country make an effort to do anything for itself provided it does nothing against itself. It is therefore the inhabitants themselves who permit, or, rather, bring about, their own subjection, since by ceasing to submit they would put an end to their servitude. A people enslaves itself, cuts its own throat, when, having a choice between being vassals and being free men, it deserts its liberties and takes on the yoke, gives consent to its own misery, or, rather, apparently welcomes it. If it cost the people anything to recover its freedom, I should not urge action to this end, although there is nothing a human should hold more dear than the restoration of his own natural right, to change himself from a beast of burden back to a man, so to speak. I do not demand of him so much boldness; let him prefer the doubtful security of living wretchedly to the uncertain hope of living as he pleases. What then? If in order to have liberty nothing more is needed than to long for it, if only a simple act of the will is necessary, is there any nation in the world that considers a single wish too high a price to pay in order to recover rights which it ought to be ready to redeem at the cost of its blood, rights such that their loss must bring all men of honor to the point of feeling life to be unendurable and death itself a deliverance?
Everyone knows that the fire from a little spark will increase and blaze ever higher as long as it finds wood to burn; yet without being quenched by water, but merely by finding no more fuel to feed on, it consumes itself, dies down, and is no longer a flame. Similarly, the more tyrants pillage, the more they crave, the more they ruin and destroy; the more one yields to them, and obeys them, by that much do they become mightier and more formidable, the readier to annihilate and destroy. But if not one thing is yielded to them, if, without any violence they are simply not obeyed, they become naked and undone and as nothing, just as, when the root receives no nourishment, the branch withers and dies.
To achieve the good that they desire, the bold do not fear danger; the intelligent do not refuse to undergo suffering. It is the stupid and cowardly who are neither able to endure hardship nor to vindicate their rights; they stop at merely longing for them, and lose through timidity the valor roused by the effort to claim their rights, although the desire to enjoy them still remains as part of their nature. A longing common to both the wise and the foolish, to brave men and to cowards, is this longing for all those things which, when acquired, would make them happy and contented. Yet one element appears to be lacking. I do not know how it happens that nature fails to place within the hearts of men a burning desire for liberty, a blessing so great and so desirable that when it is lost all evils follow thereafter, and even the blessings that remain lose taste and savor because of their corruption by servitude. Liberty is the only joy upon which men do not seem to insist; for surely if they really wanted it they would receive it. Apparently they refuse this wonderful privilege because it is so easily acquired.
Poor, wretched, and stupid peoples, nations determined on your own misfortune and blind to your own good! You let yourselves be deprived before your own eyes of the best part of your revenues; your fields are plundered, your homes robbed, your family heirlooms taken away. You live in such a way that you cannot claim a single thing as your own; and it would seem that you consider yourselves lucky to be loaned your property, your families, and your very lives. All this havoc, this misfortune, this ruin, descends upon you not from alien foes, but from the one enemy whom you yourselves render as powerful as he is, for whom you go bravely to war, for whose greatness you do not refuse to offer your own bodies unto death. He who thus domineers over you has only two eyes, only two hands, only one body, no more than is possessed by the least man among the infinite numbers dwelling in your cities; he has indeed nothing more than the power that you confer upon him to destroy you. Where has he acquired enough eyes to spy upon you, if you do not provide them yourselves? How can he have so many arms to beat you with, if he does not borrow them from you? The feet that trample down your cities, where does he get them if they are not your own? How does he have any power over you except through you? How would he dare assail you if he had no cooperation from you? What could he do to you if you yourselves did not connive with the thief who plunders you, if you were not accomplices of the murderer who kills you, if you were not traitors to yourselves? You sow your crops in order that he may ravage them, you install and furnish your homes to give him goods to pillage; you rear your daughters that he may gratify his lust; you bring up your children in order that he may confer upon them the greatest privilege he knows — to be led into his battles, to be delivered to butchery, to be made the servants of his greed and the instruments of his vengeance; you yield your bodies unto hard labor in order that he may indulge in his delights and wallow in his filthy pleasures; you weaken yourselves in order to make him the stronger and the mightier to hold you in check. From all these indignities, such as the very beasts of the field would not endure, you can deliver yourselves if you try, not by taking action, but merely by willing to be free. Resolve to serve no more, and you are at once freed. I do not ask that you place hands upon the tyrant to topple him over, but simply that you support him no longer; then you will behold him, like a great Colossus whose pedestal has been pulled away, fall of his own weight and break in pieces.
Doctors are no doubt correct in warning us not to touch incurable wounds; and I am presumably taking chances in preaching as I do to a people which has long lost all sensitivity and, no longer conscious of its infirmity, is plainly suffering from mortal illness. Let us therefore understand by logic, if we can, how it happens that this obstinate willingness to submit has become so deeply rooted in a nation that the very love of liberty now seems no longer natural.
In the first place, all would agree that, if we led our lives according to the ways intended by nature and the lessons taught by her, we should be intuitively obedient to our parents; later we should adopt reason as our guide and become slaves to nobody. Concerning the obedience given instinctively to one's father and mother, we are in agreement, each one admitting himself to be a model. As to whether reason is born with us or not, that is a question loudly discussed by academicians and treated by all schools of philosophers. For the present I think I do not err in stating that there is in our souls some native seed of reason, which, if nourished by good counsel and training, flowers into virtue, but which, on the other hand, if unable to resist the vices surrounding it, is stifled and blighted. Yet surely if there is anything in this world clear and obvious, to which one cannot close one's eyes, it is the fact that nature, handmaiden of God, governess of men, has cast us all in the same mold in order that we may behold in one another companions, or rather brothers. If in distributing her gifts nature has favored some more than others with respect to body or spirit, she has nevertheless not planned to place us within this world as if it were a field of battle, and has not endowed the stronger or the cleverer in order that they may act like armed brigands in a forest and attack the weaker. One should rather conclude that in distributing larger shares to some and smaller shares to others, nature has intended to give occasion for brotherly love to become manifest, some of us having the strength to give help to others who are in need of it. Hence, since this kind mother has given us the whole world as a dwelling place, has lodged us in the same house, has fashioned us according to the same model so that in beholding one another we might almost recognize ourselves; since she has bestowed upon us all the great gift of voice and speech for fraternal relationship, thus achieving by the common and mutual statement of our thoughts a communion of our wills; and since she has tried in every way to narrow and tighten the bond of our union and kinship; since she has revealed in every possible manner her intention, not so much to associate us as to make us one organic whole, there can be no further doubt that we are all naturally free, inasmuch as we are all comrades. Accordingly it should not enter the mind of anyone that nature has placed some of us in slavery, since she has actually created us all in one likeness.
Therefore it is fruitless to argue whether or not liberty is natural, since none can be held in slavery without being wronged, and in a world governed by a nature, which is reasonable, there is nothing so contrary as an injustice. Since freedom is our natural state, we are not only in possession of it but have the urge to defend it. Now, if perchance some cast a doubt on this conclusion and are so corrupted that they are not able to recognize their rights and inborn tendencies, I shall have to do them the honor that is properly theirs and place, so to speak, brute beasts in the pulpit to throw light on their nature and condition. The very beasts, God help me! if men are not too deaf, cry out to them, "Long live Liberty!" Many among them die as soon as captured: just as the fish loses life as soon as he leaves the water, so do these creatures close their eyes upon the light and have no desire to survive the loss of their natural freedom. If the animals were to constitute their kingdom by rank, their nobility would be chosen from this type. Others, from the largest to the smallest, when captured put up such a strong resistance by means of claws, horns, beak, and paws, that they show clearly enough how they cling to what they are losing; afterwards in captivity they manifest by so many evident signs their awareness of their misfortune, that it is easy to see they are languishing rather than living, and continue their existence more in lamentation of their lost freedom than in enjoyment of their servitude. What else can explain the behavior of the elephant who, after defending himself to the last ounce of his strength and knowing himself on the point of being taken, dashes his jaws against the trees and breaks his tusks, thus manifesting his longing to remain free as he has been and proving his wit and ability to buy off the huntsmen in the hope that through the sacrifice of his tusks he will be permitted to offer his ivory as a ransom for his liberty? We feed the horse from birth in order to train him to do our bidding. Yet he is tamed with such difficulty that when we begin to break him in he bites the bit, he rears at the touch of the spur, as if to reveal his instinct and show by his actions that, if he obeys, he does so not of his own free will but under constraint. What more can we say?
"Even the oxen under the weight of the yoke complain, And the birds in their cage lament,"
as I expressed it some time ago, toying with our French poesy. For I shall not hesitate in writing to you, O Longa,[8] to introduce some of my verses, which I never read to you because of your obvious encouragement which is quite likely to make me conceited. And now, since all beings, because they feel, suffer misery in subjection and long for liberty; since the very beasts, although made for the service of man, cannot become accustomed to control without protest, what evil chance has so denatured man that he, the only creature really born to be free, lacks the memory of his original condition and the desire to return to it?
There are three kinds of tyrants; some receive their proud position through elections by the people, others by force of arms, others by inheritance. Those who have acquired power by means of war act in such wise that it is evident they rule over a conquered country. Those who are born to kingship are scarcely any better, because they are nourished on the breast of tyranny, suck in with their milk the instincts of the tyrant, and consider the people under them as their inherited serfs; and according to their individual disposition, miserly or prodigal, they treat their kingdom as their property. He who has received the state from the people, however, ought to be, it seems to me, more bearable and would be so, I think, were it not for the fact that as soon as he sees himself higher than the others, flattered by that quality which we call grandeur, he plans never to relinquish his position. Such a man usually determines to pass on to his children the authority that the people have conferred upon him; and once his heirs have taken this attitude, strange it is how far they surpass other tyrants in all sorts of vices, and especially in cruelty, because they find no other means to impose this new tyranny than by tightening control and removing their subjects so far from any notion of liberty that even if the memory of it is fresh it will soon be eradicated. Yet, to speak accurately, I do perceive that there is some difference among these three types of tyranny, but as for stating a preference, I cannot grant there is any. For although the means of coming into power differ, still the method of ruling is practically the same; those who are elected act as if they were breaking in bullocks; those who are conquerors make the people their prey; those who are heirs plan to treat them as if they were their natural slaves.
In connection with this, let us imagine some newborn individuals, neither acquainted with slavery nor desirous of liberty, ignorant indeed of the very words. If they were permitted to choose between being slaves and free men, to which would they give their vote? There can be no doubt that they would much prefer to be guided by reason itself than to be ordered about by the whims of a single man. The only possible exception might be the Israelites who, without any compulsion or need, appointed a tyrant.[9] I can never read their history without becoming angered and even inhuman enough to find satisfaction in the many evils that befell them on this account. But certainly all men, as long as they remain men, before letting themselves become enslaved must either be driven by force or led into it by deception; conquered by foreign armies, as were Sparta and Athens by the forces of Alexander [10] or by political factions, as when at an earlier period the control of Athens had passed into the hands of Pisistrates.[11] When they lose their liberty through deceit they are not so often betrayed by others as misled by themselves. This was the case with the people of Syracuse, chief city of Sicily (I am told the place is now named Saragossa [12]) when, in the throes of war and heedlessly planning only for the present danger, they promoted Denis,[13] their first tyrant, by entrusting to him the command of the army, without realizing that they had given him such power that on his victorious return this worthy man would behave as if he had vanquished not his enemies but his compatriots, transforming himself from captain to king, and then from king to tyrant.
It is incredible how as soon as a people becomes subject, it promptly falls into such complete forgetfulness of its freedom that it can hardly be roused to the point of regaining it, obeying so easily and so willingly that one is led to say, on beholding such a situation, that this people has not so much lost its liberty as won its enslavement. It is true that in the beginning men submit under constraint and by force; but those who come after them obey without regret and perform willingly what their predecessors had done because they had to. This is why men born under the yoke and then nourished and reared in slavery are content, without further effort, to live in their native circumstance, unaware of any other state or right, and considering as quite natural the condition into which they were born. There is, however, no heir so spendthrift or indifferent that he does not sometimes scan the account books of his father in order to see if he is enjoying all the privileges of his legacy or whether, perchance, his rights and those of his predecessor have not been encroached upon. Nevertheless it is clear enough that the powerful influence of custom is in no respect more compelling than in this, namely, habituation to subjection. It is said that Mithridates[14] trained himself to drink poison. Like him we learn to swallow, and not to find bitter, the venom of servitude. It cannot be denied that nature is influential in shaping us to her will and making us reveal our rich or meager endowment; yet it must be admitted that she has less power over us than custom, for the reason that native endowment, no matter how good, is dissipated unless encouraged, whereas environment always shapes us in its own way, whatever that may be, in spite of nature's gifts. The good seed that nature plants in us is so slight and so slippery that it cannot withstand the least harm from wrong nourishment; it flourishes less easily, becomes spoiled, withers, and comes to nothing. Fruit trees retain their own particular quality if permitted to grow undisturbed, but lose it promptly and bear strange fruit not their own when ingrafted. Every herb has its peculiar characteristics, its virtues and properties; yet frost, weather, soil, or the gardener's hand increase or diminish its strength; the plant seen in one spot cannot be recognized in another.
Whoever could have observed the early Venetians,[15] a handful of people living so freely that the most wicked among them would not wish to be king over them, so born and trained that they would not vie with one another except as to which one could give the best counsel and nurture their liberty most carefully, so instructed and developed from their cradles that they would not exchange for all the other delights of the world an iota of their freedom; who, I say, familiar with the original nature of such a people, could visit today the territories of the man known as the Great Doge, and there contemplate with composure a people unwilling to live except to serve him, and maintaining his power at the cost of their lives? Who would believe that these two groups of people had an identical origin? Would one not rather conclude that upon leaving a city of men he had chanced upon a menagerie of beasts? Lycurgus,[16] the lawgiver of Sparta, is reported to have reared two dogs of the same litter by fattening one in the kitchen and training the other in the fields to the sound of the bugle and the horn, thereby to demonstrate to the Lacedaemonians that men, too, develop according to their early habits. He set the two dogs in the open market place, and between them he placed a bowl of soup and a hare. One ran to the bowl of soup, the other to the hare; yet they were, as he maintained, born brothers of the same parents. In such manner did this leader, by his laws and customs, shape and instruct the Spartans so well that any one of them would sooner have died than acknowledge any sovereign other than law and reason.
It gives me pleasure to recall a conversation of the olden time between one of the favorites of Xerxes, the great king of Persia, and two Lacedaemonians. When Xerxes[17] equipped his great army to conquer Greece, he sent his ambassadors into the Greek cities to ask for water and earth. That was the procedure the Persians adopted in summoning the cities to surrender. Neither to Athens nor to Sparta, however, did he dispatch such messengers, because those who had been sent there by Darius his father had been thrown, by the Athenians and Spartans, some into ditches and others into wells, with the invitation to help themselves freely there to water and soil to take back to their prince. Those Greeks could not permit even the slightest suggestion of encroachment upon their liberty. The Spartans suspected, nevertheless, that they had incurred the wrath of the gods by their action, and especially the wrath of Talthybios,[18] the god of the heralds; in order to appease him they decided to send to Xerxes two of their citizens in atonement for the cruel death inflicted upon the ambassadors of his father. Two Spartans, one named Sperte and the other Bulis, volunteered to offer themselves as a sacrifice. So they departed, and on the way they came to the palace of the Persian named Hydarnes, lieutenant of the king in all the Asiatic cities situated on the sea coasts. He received them with great honor, feasted them, and then, speaking of one thing and another, he asked them why they refused so obdurately his king's friendship. "Consider well, O Spartans," said he, "and realize by my example that the king knows how to honor those who are worthy, and believe that if you were his men he would do the same for you; if you belonged to him and he had known you, there is not one among you who might not be the lord of some Greek city."
"By such words, Hydarnes, you give us no good counsel," replied the Lacedaemonians, "because you have experienced merely the advantage of which you speak; you do not know the privilege we enjoy. You have the honor of the king's favor; but you know nothing about liberty, what relish it has and how sweet it is. For if you had any knowledge of it, you yourself would advise us to defend it, not with lance and shield, but with our very teeth and nails."
Only Spartans could give such an answer, and surely both of them spoke as they had been trained. It was impossible for the Persian to regret liberty, not having known it, nor for the Lacedaemonians to find subjection acceptable after having enjoyed freedom.
Cato the Utican,[19] while still a child under the rod, could come and go in the house of Sylla the despot. Because of the place and family of his origin and because he and Sylla were close relatives, the door was never closed to him. He always had his teacher with him when he went there, as was the custom for children of noble birth. He noticed that in the house of Sylla, in the dictator's presence or at his command, some men were imprisoned and others sentenced; one was banished, another was strangled; one demanded the goods of another citizen, another his head; in short, all went there, not as to the house of a city magistrate but as to the people's tyrant, and this was therefore not a court of justice, but rather a resort of tyranny. Whereupon the young lad said to his teacher, "Why don't you give me a dagger? I will hide it under my robe. I often go into Sylla's room before he is risen, and my arm is strong enough to rid the city of him." There is a speech truly characteristic of Cato; it was a true beginning of this hero so worthy of his end. And should one not mention his name or his country, but state merely the fact as it is, the episode itself would speak eloquently, and anyone would divine that he was a Roman born in Rome at the time when she was free.
And why all this? Certainly not because I believe that the land or the region has anything to do with it, for in any place and in any climate subjection is bitter and to be free is pleasant; but merely because I am of the opinion that one should pity those who, at birth, arrive with the yoke upon their necks. We should exonerate and forgive them, since they have not seen even the shadow of liberty, and, being quite unaware of it, cannot perceive the evil endured through their own slavery. If there were actually a country like that of the Cimmerians mentioned by Homer, where the sun shines otherwise than on our own, shedding its radiance steadily for six successive months and then leaving humanity to drowse in obscurity until it returns at the end of another half-year, should we be surprised to learn that those born during this long night do grow so accustomed to their native darkness that unless they were told about the sun they would have no desire to see the light? One never pines for what he has never known; longing comes only after enjoyment and constitutes, amidst the experience of sorrow, the memory of past joy. It is truly the nature of man to be free and to wish to be so, yet his character is such that he instinctively follows the tendencies that his training gives him.
Let us therefore admit that all those things to which he is trained and accustomed seem natural to man and that only that is truly native to him which he receives with his primitive, untrained individuality. Thus custom becomes the first reason for voluntary servitude. Men are like handsome race horses who first bite the bit and later like it, and rearing under the saddle a while soon learn to enjoy displaying their harness and prance proudly beneath their trappings. Similarly men will grow accustomed to the idea that they have always been in subjection, that their fathers lived in the same way; they will think they are obliged to suffer this evil, and will persuade themselves by example and imitation of others, finally investing those who order them around with proprietary rights, based on the idea that it has always been that way.
There are always a few, better endowed than others, who feel the weight of the yoke and cannot restrain themselves from attempting to shake it off: these are the men who never become tamed under subjection and who always, like Ulysses on land and sea constantly seeking the smoke of his chimney, cannot prevent themselves from peering about for their natural privileges and from remembering their ancestors and their former ways. These are in fact the men who, possessed of clear minds and far-sighted spirit, are not satisfied, like the brutish mass, to see only what is at their feet, but rather look about them, behind and before, and even recall the things of the past in order to judge those of the future, and compare both with their present condition. These are the ones who, having good minds of their own, have further trained them by study and learning. Even if liberty had entirely perished from the earth, such men would invent it. For them slavery has no satisfactions, no matter how well disguised.
The Grand Turk was well aware that books and teaching more than anything else give men the sense to comprehend their own nature and to detest tyranny. I understand that in his territory there are few educated people, for he does not want many. On account of this restriction, men of strong zeal and devotion, who in spite of the passing of time have preserved their love of freedom, still remain ineffective because, however numerous they may be, they are not known to one another; under the tyrant they have lost freedom of action, of speech, and almost of thought; they are alone in their aspiration. Indeed Momus, god of mockery, was not merely joking when he found this to criticize in the man fashioned by Vulcan, namely, that the maker had not set a little window in his creature's heart to render his thoughts visible. It is reported that Brutus, Cassius, and Casca, on undertaking to free Rome, and for that matter the whole world, refused to include in their band Cicero,[20] that great enthusiast for the public welfare if ever there was one, because they considered his heart too timid for such a lofty deed; they trusted his willingness but they were none too sure of his courage. Yet whoever studies the deeds of earlier days and the annals of antiquity will find practically no instance of heroes who failed to deliver their country from evil hands when they set about their task with a firm, whole-hearted, and sincere intention. Liberty, as if to reveal her nature, seems to have given them new strength. Harmodios and Aristogiton,[21] Thrasybulus,[22] Brutus the Elder,[23] Valerianus,[24] and Dion[25] achieved successfully what they planned virtuously: for hardly ever does good fortune fail a strong will. Brutus the Younger and Cassius were successful in eliminating servitude, and although they perished in their attempt to restore liberty, they did not die miserably (what blasphemy it would be to say there was anything miserable about these men, either in their death or in their living!). Their loss worked great harm, everlasting misfortune, and complete destruction of the Republic, which appears to have been buried with them. Other and later undertakings against the Roman emperors were merely plottings of ambitious people, who deserve no pity for the misfortunes that overtook them, for it is evident that they sought not to destroy, but merely to usurp the crown, scheming to drive away the tyrant, but to retain tyranny. For myself, I could not wish such men to prosper and I am glad they have shown by their example that the sacred name of Liberty must never be used to cover a false enterprise.
But to come back to the thread of our discourse, which I have practically lost: the essential reason why men take orders willingly is that they are born serfs and are reared as such. From this cause there follows another result, namely that people easily become cowardly and submissive under tyrants. For this observation I am deeply grateful to Hippocrates, the renowned father of medicine, who noted and reported it in a treatise of his entitled Concerning Diseases. This famous man was certainly endowed with a great heart and proved it clearly by his reply to the Great King,[26] who wanted to attach him to his person by means of special privileges and large gifts. Hippocrates answered frankly that it would be a weight on his conscience to make use of his science for the cure of barbarians who wished to slay his fellow Greeks, or to serve faithfully by his skill anyone who undertook to enslave Greece. The letter he sent the king can still be read among his other works and will forever testify to his great heart and noble character.
By this time it should be evident that liberty once lost, valor also perishes. A subject people shows neither gladness nor eagerness in combat: its men march sullenly to danger almost as if in bonds, and stultified; they do not feel throbbing within them that eagerness for liberty which engenders scorn of peril and imparts readiness to acquire honor and glory by a brave death amidst one's comrades. Among free men there is competition as to who will do most, each for the common good, each by himself, all expecting to share in the misfortunes of defeat, or in the benefits of victory; but an enslaved people loses in addition to this warlike courage, all signs of enthusiasm, for their hearts are degraded, submissive, and incapable of any great deed. Tyrants are well aware of this, and, in order to degrade their subjects further, encourage them to assume this attitude and make it instinctive.
Xenophon, grave historian of first rank among the Greeks, wrote a book [27] in which he makes Simonides speak with Hieron, Tyrant of Syracuse, concerning the anxieties of the tyrant. This book is full of fine and serious remonstrances, which in my opinion are as persuasive as words can be. Would to God that all despots who have ever lived might have kept it before their eyes and used it as a mirror! I cannot believe they would have failed to recognize their warts and to have conceived some shame for their blotches. In this treatise is explained the torment in which tyrants find themselves when obliged to fear everyone because they do evil unto every man. Among other things we find the statement that bad kings employ foreigners in their wars and pay them, not daring to entrust weapons in the hands of their own people, whom they have wronged. (There have been good kings who have used mercenaries from foreign nations, even among the French, although more so formerly than today, but with the quite different purpose of preserving their own people, considering as nothing the loss of money in the effort to spare French lives. That is, I believe, what Scipio [28] the great African meant when he said he would rather save one citizen than defeat a hundred enemies.) For it is plainly evident that the dictator does not consider his power firmly established until he has reached the point where there is no man under him who is of any worth.
Therefore there may be justly applied to him the reproach to the master of the elephants made by Thrason and reported by Terence:
Are you indeed so proud Because you command wild beasts? [29]
This method tyrants use of stultifying their subjects cannot be more clearly observed than in what Cyrus[30] did with the Lydians after he had taken Sardis, their chief city, and had at his mercy the captured Croesus, their fabulously rich king. When news was brought to him that the people of Sardis had rebelled, it would have been easy for him to reduce them by force; but being unwilling either to sack such a fine city or to maintain an army there to police it, he thought of an unusual expedient for reducing it. He established in it brothels, taverns, and public games, and issued the proclamation that the inhabitants were to enjoy them. He found this type of garrison so effective that he never again had to draw the sword against the Lydians. These wretched people enjoyed themselves inventing all kinds of games, so that the Latins have derived the word from them, and what we call pastimes they call ludi, as if they meant to say Lydi. Not all tyrants have manifested so clearly their intention to effeminize their victims; but in fact, what the aforementioned despot publicly proclaimed and put into effect, most of the others have pursued secretly as an end. It is indeed the nature of the populace, whose density is always greater in the cities, to be suspicious toward one who has their welfare at heart, and gullible toward one who fools them. Do not imagine that there is any bird more easily caught by decoy, nor any fish sooner fixed on the hook by wormy bait, than are all these poor fools neatly tricked into servitude by the slightest feather passed, so to speak, before their mouths. Truly it is a marvellous thing that they let themselves be caught so quickly at the slightest tickling of their fancy. Plays, farces, spectacles, gladiators, strange beasts, medals, pictures, and other such opiates, these were for ancient peoples the bait toward slavery, the price of their liberty, the instruments of tyranny. By these practices and enticements the ancient dictators so successfully lulled their subjects under the yoke, that the stupefied peoples, fascinated by the pastimes and vain pleasures flashed before their eyes, learned subservience as naively, but not so creditably, as little children learn to read by looking at bright picture books. Roman tyrants invented a further refinement. They often provided the city wards with feasts to cajole the rabble, always more readily tempted by the pleasure of eating than by anything else. The most intelligent and understanding amongst them would not have quit his soup bowl to recover the liberty of the Republic of Plato. Tyrants would distribute largess, a bushel of wheat, a gallon of wine, and a sesterce: [31] and then everybody would shamelessly cry, "Long live the King!" The fools did not realize that they were merely recovering a portion of their own property, and that their ruler could not have given them what they were receiving without having first taken it from them. A man might one day be presented with a sesterce and gorge himself at the public feast, lauding Tiberius and Nero for handsome liberality, who on the morrow, would be forced to abandon his property to their avarice, his children to their lust, his very blood to the cruelty of these magnificent emperors, without offering any more resistance than a stone or a tree stump. The mob has always behaved in this way � eagerly open to bribes that cannot be honorably accepted, and dissolutely callous to degradation and insult that cannot be honorably endured. Nowadays I do not meet anyone who, on hearing mention of Nero, does not shudder at the very name of that hideous monster, that disgusting and vile pestilence. Yet when he died — when this incendiary, this executioner, this savage beast, died as vilely as he had lived — the noble Roman people, mindful of his games and his festivals, were saddened to the point of wearing mourning for him. Thus wrote Cornelius Tacitus,[32] a competent and serious author, and one of the most reliable. This will not be considered peculiar in view of what this same people had previously done at the death of Julius Caesar, who had swept away their laws and their liberty, in whose character, it seems to me, there was nothing worth while, for his very liberality, which is so highly praised, was more baneful than the crudest tyrant who ever existed, because it was actually this poisonous amiability of his that sweetened servitude for the Roman people. After his death, that people, still preserving on their palates the flavor of his banquets and in their minds the memory of his prodigality, vied with one another to pay him homage. They piled up the seats of the Forum for the great fire that reduced his body to ashes, and later raised a column to him as to "The Father of His People." [33] (Such was the inscription on the capital.) They did him more honor, dead as he was, than they had any right to confer upon any man in the world, except perhaps on those who had killed him.
They didn't even neglect, these Roman emperors, to assume generally the title of Tribune of the People, partly because this office was held sacred and inviolable and also because it had been founded for the defense and protection of the people and enjoyed the favor of the state. By this means they made sure that the populace would trust them completely, as if they merely used the title and did not abuse it. Today there are some who do not behave very differently: they never undertake an unjust policy, even one of some importance, without prefacing it with some pretty speech concerning public welfare and common good. You well know, O Longa, this formula which they use quite cleverly in certain places; although for the most part, to be sure, there cannot be cleverness where there is so much impudence. The kings of the Assyrians and even after them those of the Medes showed themselves in public as seldom as possible in order to set up a doubt in the minds of the rabble as to whether they were not in some way more than man, and thereby to encourage people to use their imagination for those things which they cannot judge by sight. Thus a great many nations who for a long time dwelt under the control of the Assyrians became accustomed, with all this mystery, to their own subjection, and submitted the more readily for not knowing what sort of master they had, or scarcely even if they had one, all of them fearing by report someone they had never seen. The earliest kings of Egypt rarely showed themselves without carrying a cat, or sometimes a branch, or appearing with fire on their heads, masking themselves with these objects and parading like workers of magic. By doing this they inspired their subjects with reverence and admiration, whereas with people neither too stupid nor too slavish they would merely have aroused, it seems to me, amusement and laughter. It is pitiful to review the list of devices that early despots used to establish their tyranny; to discover how many little tricks they employed, always finding the populace conveniently gullible, readily caught in the net as soon as it was spread. Indeed they always fooled their victims so easily that while mocking them they enslaved them the more.
What comment can I make concerning another fine counterfeit that ancient peoples accepted as true money? They believed firmly that the great toe of Pyrrhus,[34] king of Epirus, performed miracles and cured diseases of the spleen; they even enhanced the tale further with the legend that this toe, after the corpse had been burned, was found among the ashes, untouched by the fire. In this wise a foolish people itself invents lies and then believes them. Many men have recounted such things, but in such a way that it is easy to see that the parts were pieced together from idle gossip of the city and silly reports from the rabble. When Vespasian,[35] returning from Assyria, passes through Alexandria on his way to Rome to take possession of the empire, he performs wonders: he makes the crippled straight, restores sight to the blind, and does many other fine things, concerning which the credulous and undiscriminating were, in my opinion, more blind than those cured. Tyrants themselves have wondered that men could endure the persecution of a single man; they have insisted on using religion for their own protection and, where possible, have borrowed a stray bit of divinity to bolster up their evil ways. If we are to believe the Sybil of Virgil, Salmoneus,[36] in torment for having paraded as Jupiter in older to deceive the populace, now atones in nethermost Hell:
He suffered endless torment for having dared to imitate The thunderbolts of heaven and the flames of Jupiter. Upon a chariot drawn by four chargers he went, unsteadily Riding aloft, in his fist a great shining torch. Among the Greeks and into the market-place In the heart of the city of Elis he had ridden boldly: And displaying thus his vainglory he assumed An honor which undeniably belongs to the gods alone. This fool who imitated storm and the inimitable thunderbolt By clash of brass and with his dizzying charge On horn-hoofed steeds, the all-powerful Father beheld, Hurled not a torch, nor the feeble light From a waxen taper with its smoky fumes, But by the furious blast of thunder and lightning He brought him low, his heels above his head.[37]
If such a one, who in his time acted merely through the folly of insolence, is so well received in Hell, I think that those who have used religion as a cloak to hide their vile-ness will be even more deservedly lodged in the same place.
Our own leaders have employed in France certain similar devices, such as toads, fleurs-de-lys, sacred vessels, and standards with flames of gold.[38] However that may be, I do not wish, for my part, to be incredulous, since neither we nor our ancestors have had any occasion up to now for skepticism. Our kings have always been so generous in times of peace and so valiant in time of war, that from birth they seem not to have been created by nature like many others, but even before birth to have been designated by Almighty God for the government and preservation of this kingdom. Even if this were not so, yet should I not enter the tilting ground to call in question the truth of our traditions, or to examine them so strictly as to take away their fine conceits. Here is such a field for our French poetry, now not merely honored but, it seems to me, reborn through our Ronsard, our Baïf, our Bellay.[39] These poets are defending our language so well that I dare to believe that very soon neither the Greeks nor the Latins will in this respect have any advantage over us except possibly that of seniority. And I should assuredly do wrong to our poesy — I like to use that word despite the fact that several have rimed mechanically, for I still discern a number of men today capable of ennobling poetry and restoring it to its first lustre — but, as I say, I should do the Muse great injury if I deprived her now of those fine tales about King Clovis, amongst which it seems to me I can already see how agreeably and how happily the inspiration of our Ronsard in his Franciade [40] will play. I appreciate his loftiness, I am aware of his keen spirit, and I know the charm of the man: he will appropriate the oriflamme to his use much as did the Romans their sacred bucklers and the shields cast from heaven to earth, according to Virgil.[41] He will use our phial of holy oil much as the Athenians used the basket of Ericthonius;[42] he will win applause for our deeds of valor as they did for their olive wreath which they insist can still be found in Minerva's tower. Certainly I should be presumptuous if I tried to cast slurs on our records and thus invade the realm of our poets.
But to return to our subject, the thread of which I have unwittingly lost in this discussion: it has always happened that tyrants, in order to strengthen their power, have made every effort to train their people not only in obedience and servility toward themselves, but also in adoration. Therefore all that I have said up to the present concerning the means by which a more willing submission has been obtained applies to dictators in their relationship with the inferior and common classes.
I come now to a point which is, in my opinion, the mainspring and the secret of domination, the support and foundation of tyranny. Whoever thinks that halberds, sentries, the placing of the watch, serve to protect and shield tyrants is, in my. judgment, completely mistaken. These are used, it seems to me, more for ceremony and a show of force than for any reliance placed in them. The archers forbid the entrance to the palace to the poorly dressed who have no weapons, not to the well armed who can carry out some plot. Certainly it is easy to say of the Roman emperors that fewer escaped from danger by the aid of their guards than were killed by their own archers. It is not the troops on horseback, it is not the companies afoot, it is not arms that defend the tyrant. This does not seem credible on first thought, but it is nevertheless true that there are only four or five who maintain the dictator, four or five who keep the country in bondage to him. Five or six have always had access to his ear, and have either gone to him of their own accord, or else have been summoned by him, to be accomplices in his cruelties, companions in his pleasures, panders to his lusts, and sharers in his plunders. These six manage their chief so successfully that he comes to be held accountable not only for his own misdeeds but even for theirs. The six have six hundred who profit under them, and with the six hundred they do what they have accomplished with their tyrant. The six hundred maintain under them six thousand, whom they promote in rank, upon whom they confer the government of provinces or the direction of finances, in order that they may serve as instruments of avarice and cruelty, executing orders at the proper time and working such havoc all around that they could not last except under the shadow of the six hundred, nor be exempt from law and punishment except through their influence.
The consequence of all this is fatal indeed. And whoever is pleased to unwind the skein will observe that not the six thousand but a hundred thousand, and even millions, cling to the tyrant by this cord to which they are tied. According to Homer, Jupiter boasts of being able to draw to himself all the gods when he pulls a chain. Such a scheme caused the increase in the senate under Julius,[43] the formation of new ranks, the creation of offices; not really, if properly considered, to reform justice, but to provide new supporters of despotism. In short, when the point is reached, through big favors or little ones, that large profits or small are obtained under a tyrant, there are found almost as many people to whom tyranny seems advantageous as those to whom liberty would seem desirable. Doctors declare that if, when some part of the body has gangrene a disturbance arises in another spot, it immediately flows to the troubled part. Even so, whenever a ruler makes himself a dictator, all the wicked dregs of the nation — I do not mean the pack of petty thieves and earless ruffians[44] who, in a republic, are unimportant in evil or good — but all those who are corrupted by burning ambition or extraordinary avarice, these gather round him and support him in order to have a share in the booty and to constitute themselves petty chiefs under the big tyrant. This is the practice among notorious robbers and famous pirates: some scour the country, others pursue voyagers; some lie in ambush, others keep a lookout; some commit murder, others robbery; and although there are among them differences in rank, some being only underlings while others are chieftains of gangs, yet is there not a single one among them who does not feel himself to be a sharer, if not of the main booty, at least in the pursuit of it. It is dependably related that Sicilian pirates gathered in such great numbers that it became necessary to send against them Pompey the Great,[45] and that they drew into their alliance fine towns and great cities in whose harbors they took refuge on returning from their expeditions, paying handsomely for the haven given their stolen goods.
Thus the despot subdues his subjects, some of them by means of others, and thus is he protected by those from whom, if they were decent men, he would have to guard himself; just as, in order to split wood, one has to use a wedge of the wood itself. Such are his archers, his guards, his halberdiers; not that they themselves do not suffer occasionally at his hands, but this riff-raff, abandoned alike by God and man, can be led to endure evil if permitted to commit it, not against him who exploits them, but against those who like themselves submit, but are helpless. Nevertheless, observing those men who painfully serve the tyrant in order to win some profit from his tyranny and from the subjection of the populace, I am often overcome with amazement at their wickedness and sometimes by pity for their folly. For, in all honesty, can it be in any way except in folly that you approach a tyrant, withdrawing further from your liberty and, so to speak, embracing with both hands your servitude? Let such men lay aside briefly their ambition, or let them forget for a moment their avarice, and look at themselves as they really are. Then they will realize clearly that the townspeople, the peasants whom they trample under foot and treat worse than convicts or slaves, they will realize, I say, that these people, mistreated as they may be, are nevertheless, in comparison with themselves, better off and fairly free. The tiller of the soil and the artisan, no matter how enslaved, discharge their obligation when they do what they are told to do; but the dictator sees men about him wooing and begging his favor, and doing much more than he tells them to do. Such men must not only obey orders; they must anticipate his wishes; to satisfy him they must foresee his desires; they must wear themselves out, torment themselves, kill themselves with work in his interest, and accept his pleasure as their own, neglecting their preferences for his, distorting their character and corrupting their nature; they must pay heed to his words, to his intonation, to his gestures, and to his glance. Let them have no eye, nor foot, nor hand that is not alert to respond to his wishes or to seek out his thoughts.
Can that be called a happy life? Can it be called living? Is there anything more intolerable than that situation, I won't say for a man of mettle nor even for a man of high birth, but simply for a man of common sense or, to go even further, for anyone having the face of a man? What condition is more wretched than to live thus, with nothing to call one's own, receiving from someone else one's sustenance, one's power to act, one's body, one's very life?
Still men accept servility in order to acquire wealth; as if they could acquire anything of their own when they cannot even assert that they belong to themselves, or as if anyone could possess under a tyrant a single thing in his own name. Yet they act as if their wealth really belonged to them, and forget that it is they themselves who give the ruler the power to deprive everybody of everything, leaving nothing that anyone can identify as belonging to somebody. They notice that nothing makes men so subservient to a tyrant's cruelty as property; that the possession of wealth is the worst of crimes against him, punishable even by death; that he loves nothing quite so much as money and ruins only the rich, who come before him as before a butcher, offering themselves so stuffed and bulging that they make his mouth water. These favorites should not recall so much the memory of those who have won great wealth from tyrants as of those who, after they had for some time amassed it, have lost to him their property as well as their lives; they should consider not how many others have gained a fortune, but rather how few of them have kept it. Whether we examine ancient history or simply the times in which we live, we shall see clearly how great is the number of those who, having by shameful means won the ear of princes — who either profit from their villainies or take advantage of their naïveté — were in the end reduced to nothing by these very princes; and although at first such servitors were met by a ready willingness to promote their interests, they later found an equally obvious inconstancy which brought them to ruin. Certainly among so large a number of people who have at one time or another had some relationship with bad rulers, there have been few or practically none at all who have not felt applied to themselves the tyrant's animosity, which they had formerly stirred up against others. Most often, after becoming rich by despoiling others, under the favor of his protection, they find themselves at last enriching him with their own spoils.
Even men of character — if it sometimes happens that a tyrant likes such a man well enough to hold him in his good graces, because in him shine forth the virtue and integrity that inspire a certain reverence even in the most depraved — even men of character, I say, could not long avoid succumbing to the common malady and would early experience the effects of tyranny at their own expense. A Seneca, a Burrus, a Thrasea, this triumvirate [46] of splendid men, will provide a sufficient reminder of such misfortune. Two of them were close to the tyrant by the fatal responsibility of holding in their hands the management of his affairs, and both were esteemed and beloved by him. One of them, moreover, had a peculiar claim upon his friendship, having instructed his master as a child. Yet these three by their cruel death give sufficient evidence of how little faith one can place in the friendship of an evil ruler. Indeed what friendship may be expected from one whose heart is bitter enough to hate even his own people, who do naught else but obey him? It is because he does not know how to love that he ultimately impoverishes his own spirit and destroys his own empire.
Now if one would argue that these men fell into disgrace because they wanted to act honorably, let him look around boldly at others close to that same tyrant, and he will see that those who came into his favor and maintained themselves by dishonorable means did not fare much better. Who has ever heard tell of a love more centered, of an affection more persistent, who has ever read of a man more desperately attached to a woman than Nero was to Poppaea? Yet she was later poisoned by his own hand.[47] Agrippina his mother had killed her husband, Claudius, in order to exalt her son; to gratify him she had never hesitated at doing or bearing anything; and yet this very son, her offspring, her emperor, elevated by her hand, after failing her often, finally took her life.[48] It is indeed true that no one denies she would have well deserved this punishment, if only it had come to her by some other hand than that of the son she had brought into the world. Who was ever more easily managed, more naive, or, to speak quite frankly, a greater simpleton, than Claudius the Emperor? Who was ever more wrapped up in his wife than he in Messalina,[49] whom he delivered finally into the hands of the executioner? Stupidity in a tyrant always renders him incapable of benevolent action; but in some mysterious way by dint of acting cruelly even towards those who are his closest associates, he seems to manifest what little intelligence he may have.
Quite generally known is the striking phrase of that other tyrant who, gazing at the throat of his wife, a woman he dearly loved and without whom it seemed he could not live, caressed her with this charming comment: "This lovely throat would be cut at once if I but gave the order." [50] That is why the majority of the dictators of former days were commonly slain by their closest favorites who, observing the nature of tyranny, could not be so confident of the whim of the tyrant as they were distrustful of his power. Thus was Domitian [51] killed by Stephen, Commodus by one of his mistresses,[52] Antoninus by Macrinus,[53] and practically all the others in similar violent fashion. The fact is that the tyrant is never truly loved, nor does he love. Friendship is a sacred word, a holy thing; it is never developed except between persons of character, and never takes root except through mutual respect; it flourishes not so much by kindnesses as by sincerity. What makes one friend sure of another is the knowledge of his integrity: as guarantees he has his friend's fine nature, his honor, and his constancy. There can be no friendship where there is cruelty, where there is disloyalty, where there is injustice. And in places where the wicked gather there is conspiracy only, not companionship: these have no affection for one another; fear alone holds them together; they are not friends, they are merely accomplices.
Although it might not be impossible, yet it would be difficult to find true friendship in a tyrant; elevated above others and having no companions, he finds himself already beyond the pale of friendship, which receives its real sustenance from an equality that, to proceed without a limp, must have its two limbs equal. That is why there is honor among thieves (or so it is reported) in the sharing of the booty; they are peers and comrades; if they are not fond of one another they at least respect one another and do not seek to lessen their strength by squabbling. But the favorites of a tyrant can never feel entirely secure, and the less so because he has learned from them that he is all powerful and unlimited by any law or obligation. Thus it becomes his wont to consider his own will as reason enough, and to be master of all with never a compeer. Therefore it seems a pity that with so many examples at hand, with the danger always present, no one is anxious to act the wise man at the expense of the others, and that among so many persons fawning upon their ruler there is not a single one who has the wisdom and the boldness to say to him what, according to the fable, the fox said to the lion who feigned illness: "I should be glad to enter your lair to pay my respects; but I see many tracks of beasts that have gone toward you, yet not a single trace of any who have come back."
These wretches see the glint of the despot's treasures and are bedazzled by the radiance of his splendor. Drawn by this brilliance they come near, without realizing they are approaching a flame that cannot fail to scorch them. Similarly attracted, the indiscreet satyr of the old fables, on seeing the bright fire brought down by Prometheus, found it so beautiful that he went and kissed it, and was burned; so, as the Tuscan [54] poet reminds us, the moth, intent upon desire, seeks the flame because it shines, and also experiences its other quality, the burning. Moreover, even admitting that favorites may at times escape from the hands of him they serve, they are never safe from the ruler who comes after him. If he is good, they must render an account of their past and recognize at last that justice exists; if he is bad and resembles their late master, he will certainly have his own favorites, who are not usually satisfied to occupy in their turn merely the posts of their predecessors, but will more often insist on their wealth and their lives. Can anyone be found, then, who under such perilous circumstances and with so little security will still be ambitious to fill such an ill-fated position and serve, despite such perils, so dangerous a master? Good God, what suffering, what martrydom all this involves! To be occupied night and day in planning to please one person, and yet to fear him more than anyone else in the world; to be always on the watch, ears open, wondering whence the blow will come; to search out conspiracy, to be on guard against snares, to scan the faces of companions for signs of treachery, to smile at everybody and be mortally afraid of all, to be sure of nobody, either as an open enemy or as a reliable friend; showing always a gay countenance despite an apprehensive heart, unable to be joyous yet not daring to be sad!
However, there is satisfaction in examining what they get out of all this torment, what advantage they derive from all the trouble of their wretched existence. Actually the people never blame the tyrant for the evils they suffer, but they do place responsibility on those who influence him; peoples, nations, all compete with one another, even the peasants, even the tillers of the soil, in mentioning the names of the favorites, in analyzing their vices, and heaping upon them a thousand insults, a thousand obscenities, a thousand maledictions. All their prayers, all their vows are directed against these persons; they hold them accountable for all their misfortunes, their pestilences, their famines; and if at times they show them outward respect, at those very moments they are fuming in their hearts and hold them in greater horror than wild beasts. This is the glory and honor heaped upon influential favorites for their services by people who, if they could tear apart their living bodies, would still clamor for more, only half satiated by the agony they might behold. For even when the favorites are dead those who live after are never too lazy to blacken the names of these man-eaters with the ink of a thousand pens, tear their reputations into bits in a thousand books, and drag, so to speak, their bones past posterity, forever punishing them after their death for their wicked lives.
Let us therefore learn while there is yet time, let us learn to do good. Let us raise our eyes to Heaven for the sake of our honor, for the very love of virtue, or, to speak wisely, for the love and praise of God Almighty, who is the infallible witness of our deeds and the just judge of our faults. As for me, I truly believe I am right, since there is nothing so contrary to a generous and loving God as dictatorship — I believe He has reserved, in a separate spot in Hell, some very special punishment for tyrants and their accomplices.
Notes in the Main Text:
[1] Iliad, Book II, Lines 204-205.
[2] Government by a single ruler. From the Greek monos (single) and arkhein (to command).
[3] At this point begins the text of the long fragment published in the Reveille-Matin des François. See Introduction, p. xvii.
[4] An autocratic council of thirty magistrates that governed Athens for eight months in 404 B.C. They exhibited such monstrous despotism that the city rose in anger and drove them forth.
[5] Athenian general, died 489 B.C. Some of his battles: expedition against Scythians; Lemnos; Imbros; Marathon, where Darius the Persian was defeated.
[6] King of Sparta, died at Thermopylae in 480 B.C., defending the pass with three hundred loyal Spartans against Xerxes.
[7] Athenian statesman and general, died 460 B.C. Some of his battles: expedition against Aegean Isles; victory over Persians under Xerxes at Salamis.
[8] See Introduction, p. x.
[9] The reference is to Saul anointed by Samuel.
[10] Alexander the Macedonian became the acknowledged master of all Hellenes at the Assembly of Corinth, 335 B.C.
[11] Athenian tyrant, died 527 B.C. He used ruse and bluster to control the city and was obliged to flee several times.
[12] The name Syracuse is derived from Syraca, the marshland near which the city was founded. The author is misinformed about "Sarragousse," which is the Spanish Zaragoza, capital of Aragón.
[13] Denis or Dionysius, tyrant of Syracuse, died in 367 B.C. Of lowly birth, this dictator imposed himself by plottings, putsches, and purges. The danger from which he saved his city was the invasion by the Carthaginians.
[14] Mithridates (c. 135-63 B.C.) was next to Hannibal the most dreaded and potent enemy of Roman Power. The reference in the text is to his youth when he spent some years in retirement hardening himself and immunizing himself against poison. In his old age, defeated by Pompey, betrayed by his own son, he tried poison and finally had to resort to the dagger of a friendly Gaul. (Pliny, Natural History, XXIV, 2.)
[15] This passage probably suggested to Montaigne that his friend would have been glad to see the light in Venice. See Essays, Book I, Chapter XXVIII.
[16] A half-legendary figure concerning whose life Plutarch admits there is much obscurity. He bequeathed to his land a rigid code regulating land, assembly, education, with the individual subordinate to the state.
[17] The Persian fleet and army under Xerxes or Ahasuerus set out from Sardis in 480 and were at first successful, even taking Athens and driving the Greeks to their last line of defense in the Bay of Salamis. Darius, the father of Xerxes, had made a similar incursion into Greece but was stopped at Marathon.
[18] The messenger and herald of Agamemnon in the Iliad.
[19] Marcus Porcius Cato, often called the Utican from the city where in 46 B.C., after reading the Phaedo of Plato, he ended his life. He was an uncompromising reformer and relentlessly attacked the vicious heirs to the power of Lucius Cornelius Sylla, the Roman dictator (136-78 B.C.). The Utican, born in 95 B.C., was only seventeen years old when Sylla died.
[20] Cited from Plutarch's Life of Cicero.
[21] Tradition made of Harmodios and Aristogiton martyrs for Athenian liberty. They plotted the death of the tyrant Hippias but were betrayed and put to death by torture, c. 500 B.C.
[22] Athenian statesmen and general (died 388 B.C.) who ousted the Thirty Tyrants from power in Athens and restored the government to the people.
[23] Lucius Junius Brutus was the leader of the Roman revolution which overthrew the tyranny of Tarquinius Superbus, c. 500 B.C., and established the republic under the two praetors or consuls. As one of these magistrates it became his dolorous duty to condemn to death his two sons because they had plotted for the return of the Tarquins.
[24] Publius Licinius Valerianus was a brilliant military leader chosen by his troops to be Emperor during a time of great anarchy. He met his death in Persia (260 A.D.).
[25] Dion of Syracuse (400-354? B.C.) was famous for his protection of Plato in Sicily and for his expedition in 357, which freed his city from the tyranny of Denis.
[26] Artaxerxes.
[27] The Hieron, a youthful didactic work, consisting of a dialogue between Simonides and the Tyrant of Syracuse. The latter confesses his inner doubts and misgivings, his weariness at the dangers constantly besetting him, his sadness at not being loved by anyone. Even if he gave up his power, he would be in danger from the many enemies he has made. Simonides advises him to mend his ways and try kindness and generosity as a way of government.
[28] Publius Cornelius Scipio (235-183 B.C.) led the brilliant campaign in Africa which caused Hannibal's recall from Italy and his final defeat.
[29] The Eunuch, Act III, Scene 1.
[30] Cyrus the Great (died 528 B.C.), founder of the Persian Empire, attacked Croesus before the latter could organize his army, and drove him in mid-winter out of his capital of Sardis. The episode here mentioned is related in Herodotus, Book I, chap. 86.
[31] A Roman coin (semis-half, tertius-third) of variable value, originally of silver, later of bronze.
[32] In his Histories (Book I, chap. 4) which cover the period (69-96 A.D.) from the fall of Nero to the crowning of Nerva.
[33] Suetonius, Life of Caesar, paragraphs 84-88.
[34] The great dreamer of empire whose costly victory at Asculum wrecked his hopes of world domination. He was finally killed (272 B.C.) by a tile dropped on his head by an old woman. This story of the toe conies from Plutarch's Life of Pyrrhus.
[35] Titus Flavius Vespasianus left his son Titus to complete the capture of Jerusalem while he, newly elected Emperor by his armies, turned back to Rome after the death of Galba in 69 A.D. The reference here is found in Suetonius, Life of Vespasian, Chapter VII.
[36] In Greek mythology, Salmoneus, King of Elis, was the son of Aeolus and the brother of Sisyphus. He was reckless and sacrilegious and claimed to be the equal of Zeus by imitating his thunderbolts. Zeus threw him into Hades.
[37] Aeneid, Chapter VI, verses 585 et seq.
[38] These are references to heraldic emblems of royalty. The sacred vessel contained the holy oil for the coronation of the kings of France, said to have been brought by an angel from heaven for the crowning of Clovis in 496. The fleur-de-lis is the well-known heraldic flower dating from the 12th century. In its earlier forms it has other elements besides petals, such as arrow tips, spikes, and even bees and toads. The oriflamme or standard of gold was also adopted by French royalty. Originally it belonged to the Abbey of St. Denis and had a red background, dotted with stars surrounding a flaming sun. Some scholars have noted in the three branches of the fleur-de-lis a heraldic transformation of toads which formed presumably the totem of the ancient Francs.
[39] These three were the most inspired of the Pléiade, a group of seven poets of the Renaissance in France. La Boétie's boast is impulsive but natural when one thinks of the vigor and hope of this period. Du Bellay (1548) published a Defense of the French Language which explained the literary doctrines of the group. The reference in the text to this Defense helps date the Contr'un.
[40] This unfinished epic has only four cantos; it attempts to relate how to Francus, son of Hector, is revealed the glorious future of France. He beholds a visionary procession of her kings descending from him all the way to Charlemagne. King Clovis (465-511), of whom many tales are told, was baptized after the miracle of Tolbiac and founded the Merovingian dynasty. Although the poem was not published till a few days after the Massacre of St. Bartholomew, Ronsard had spoken of his project more than twenty years before. He had even read the finished Prologue to Henry II in 1550. La Boétie's early reference bespeaks his close relations with the poets of his day.
[41] Aeneid, Canto viii, verse 664.
[42] Ericthonius, legendary King of Athens (1573-1556 B.C.) was the son of the earth. He is at times represented in the guise of a serpent carried by the Cecropides maidens to whom Athens had entrusted him as a child. The allusion here is to the Panathenaea festival when maidens carried garlanded baskets on their heads. Races were also held for which the winners received olive wreaths as prizes.
[43] Under Caesar the power of the Senators was greatly reduced and military leaders were permitted to share with them legislative and judicial powers.
[44] The cutting off of ears as a punishment for thievery is very ancient. In the middle ages it was still practiced under St. Louis. Men so mutilated were dishonored and could not enter the clergy or the magistracy.
[45] Plutarch's Life of Pompey.
[46] Lucius Annaeus Seneca (4 B.C.-65 A.D.) was exiled from Rome to Corsica for eight years by the intrigues of Messalina, wife of Claudius. Agrippina had him recalled and entrusted to him jointly with Burrus the education of her son Nero. Seneca ended his life some fifteen years later when Nero, suspecting him of conspiracy, ordered him to die. Burrus similarly tried to restrain the tyrant but he lost his power after the murder of Agrippina, a crime which he had prevented once before. He died in 62 A.D. suspecting he had been poisoned. Thrasea, unlike these two teachers of Nero, refused to condone the crime of matricide. He attacked Nero in the Senate but finally in 66 A.D. he was condemned by that august body and, after a philosophic discourse celebrated with his friends by his side, he opened his veins.
[47] She was really killed by a kick, according to Suetonius (Life of Nero, chap. 35) and Tacitus (Annals, Book XVI, chap. 6). She abetted Nero in many of his crimes; the murder of his mother, of his gentle wife Octavia. After the brutal death inflicted on Poppaea, Nero shed many tears.
[48] Suetonius, op. cit., chap. 34, and Tacitus, op. cit., Book XII, chap. 67.
[49] Messalina (15-48 A.D.) was the fifth wife of the emperor Claudius. At first honorable, mother of two children, she suddenly turned to vice and has transmitted her name to the ages as a synonym for the lowest type of degraded womanhood. While still the wife of Claudius, she married a favorite with his connivance. The Emperor, finally convinced of her treachery, permitted the killing of his wife and her lover. He then married Agrippina who persuaded him to adopt Nero as his son, thereby signing his own death warrant, for his new wife, by giving him a plate of poisonous mushrooms, opened the way for her son's succession to the throne.
[50] Suetonius, Life of Caligula, Chapter 33.
[51] Suetonius, Life of Domitian, Chapter 17. The tyrant died in 96 A.D. after three years of bestial government inspired by abject fear of conspirators. Finally Domitia, his wife, hatched the plot which led an imperial slave to stab his royal master to death.
[52] Herodian, Book I, chap. 54. Commodus (161-192 A.D.) unworthy son of Marcus Aurelius, had planned to put to death his concubine, Marcia. She poisoned him first.
[53] Ibid., Book IV, chap. 23. The reference is to Marcus Aurelius Antoninus Bassianus, better known as Caracalla, who was killed (217 A.D.) in a plot arranged by his own praetor, Macrinas, who succeeded him to power, lasted a year, and was killed in his turn by his own soldiers.
[54] Petrarch, Canzoniere, Sonnet XVII. La Boétie has accurately rendered the lines concerning the moth.
http://www.constitution.org/la_boetie/serv_vol.htm
Chris Hedges | The Final Battle
Tuesday, 25 December 2012 10:15 By Chris Hedges, Truthdig | News Analysis
http://truth-out.org/news/item/13524-chris-hedges-%7C-the-final-battle
Over the past year I and other plaintiffs including Noam Chomsky and Daniel Ellsberg have pressed a lawsuit in the federal courts to nullify Section 1021(b)(2) of the National Defense Authorization Act (NDAA). This egregious section, which permits the government to use the military to detain U.S. citizens, strip them of due process and hold them indefinitely in military detention centers, could have been easily fixed by Congress. The Senate and House had the opportunity this month to include in the 2013 version of the NDAA an unequivocal statement that all U.S. citizens would be exempt from 1021(b)(2), leaving the section to apply only to foreigners. But restoring due process for citizens was something the Republicans and the Democrats, along with the White House, refused to do. The fate of some of our most basic and important rights—ones enshrined in the Bill of Rights as well as the Fourth and Fifth amendments of the Constitution—will be decided in the next few months in the courts. If the courts fail us, a gulag state will be cemented into place.
Sens. Dianne Feinstein, D-Calif., and Mike Lee, R-Utah, pushed through the Senate an amendment to the 2013 version of the NDAA. The amendment, although deeply flawed, at least made a symbolic attempt to restore the right to due process and trial by jury. A House-Senate conference committee led by Sen. John McCain, R-Ariz., however, removed the amendment from the bill last week.
“I was saddened and disappointed that we could not take a step forward to ensure at the very least American citizens and legal residents could not be held in detention without charge or trial,” Feinstein said in a statement issued by her office. “To me that was a no-brainer.”
The House approved the $633 billion NDAA for 2013 in a 315-107 vote late Thursday night. It will now go before the Senate. Several opponents of the NDAA in the House, including Rep. Morgan Griffith, R-Va., cited Congress’ refusal to guarantee due process and trial by jury to all citizens as his reason for voting against the bill. He wrote in a statement after the vote that “American citizens may fear being arrested and indefinitely detained by the military without knowing what they have done wrong.”
The Feinstein-Lee amendment was woefully adequate. It was probably proposed mainly for its public relations value, but nonetheless it resisted the concerted assault on our rights and sought to calm nervous voters objecting to the destruction of the rule of law. The amendment failed to emphatically state that citizens could never be placed in military custody. Rather, it said citizens could not be placed in indefinite military custody without “trial.” But this could have been a trial by military tribunals. Citizens, under the amendment, could have been barred from receiving due process in a civil court. Still, it was better than nothing. And now we have nothing. “Congressional moves concerning the NDAA make it clear that Congress as a whole has no stomach for the protection of civil liberties,” said attorney Bruce Afran, who along with attorney Carl Mayer has brought the lawsuit against President Obama in which we are attempting to block Section 1021(b)(2).
The only hero so far in this story is U.S. District Judge Katherine B. Forrest of the Southern District Court of New York. Forrest in September accepted all of our challenges to the law. She issued a permanent injunction invalidating Section 1021(b)(2). Government lawyers asked Forrest for a “stay pending appeal”—meaning the law would go back into effect until the Court of Appeals for the Second Circuit issued a ruling in the case. She refused. The government then went directly to the Court of Appeals and asked it for a temporary stay while promising not to detain the plaintiffs or other U.S. citizens under the provision. The Court of Appeals, which will hear oral arguments in January, granted the government’s request for a temporary stay. The law went back into effect. If the Court of Appeals upholds Forrest’s ruling, the case will most likely be before the Supreme Court within weeks.
“President Obama should never have appealed this watershed civil rights ruling,” Mayer said. “But now that he has, the fight may well go all the way to the Supreme Court. At stake is whether America will slide more toward authoritarianism or whether the judicial branch of government will stem the decade-long erosion of our civil liberties. Since 9/11 Americans have been systematically stripped of their freedoms: Their phone calls are monitored under [George W.] Bush and Obama’s warrantless wiretapping program, they are videotaped relentlessly in public places, there are drones over American soil and the police control protesters and dissenters with paramilitary gear and tactics. As long as Obama and the leadership of both parties want the military to police our streets, we will fight. This is unacceptable, un-American and unconstitutional.”
We knew the government would appeal, but we did not expect it to act so aggressively. This means, we suspect, that the provision is already being used, most likely to hold people with U.S. and Pakistani dual citizenship or U.S. and Afghan dual citizenship in military detention sites such as Bagram. If the injunction were allowed to stand during the appeal and U.S. citizens were being held by the military without due process, the government would be in contempt of court.
Judge Forrest’s 112-page opinion is a stark explication and condemnation of the frightening erosion of the separation of powers. In her opinion she referred to the Supreme Court ruling Korematsu v. United States, which declared constitutional the government’s internment of 110,000 Japanese-Americans without due process during World War II. The 2013 NDAA, like the old versions of the act, allows similar indefinite detentions—of Muslim Americans, dissidents and other citizens.
Section 1021(b)(2) defines a “covered person”—one subject to detention—as “a person who was a part of or substantially supported al-Qaeda, the Taliban, or associated forces that are engaged in hostilities against the United States or its coalition partners, including any person who has committed a belligerent act or has directly supported such hostilities in aid of such enemy forces.”
The section, however, does not define the terms “substantially supported,” “directly supported” or “associated forces.” The vagueness of the language means that the plaintiffs, including those who as journalists have contact with individuals or groups deemed by the State Department to be part of terrorist organizations, could along with others find themselves seized and detained under the provision.
The corporate state knows that the steady deterioration of the economy and the increasingly savage effects of climate change will create widespread social instability. It knows that rage will mount as the elites squander diminishing resources while the poor, as well as the working and middle classes, are driven into destitution. It wants to have the legal measures to keep us cowed, afraid and under control. It does not, I suspect, trust the police to maintain order. And this is why, contravening two centuries of domestic law, it has seized for itself the authority to place the military on city streets and citizens in military detention centers, where they cannot find redress in the courts. The shredding of our liberties is being done in the name of national security and the fight against terrorism. But the NDAA is not about protecting us. It is about protecting the state from us. That is why no one in the executive or legislative branch is going to restore our rights. The new version of the NDAA, like the old ones, provides our masters with the legal shackles to make our resistance impossible. And that is their intention.
This piece was reprinted by Truthout with permission or license.
"So this is how liberty dies... with thunderous applause."
Senator Padme Amidala
It amazes us to hear accounts of the valor that liberty arouses in the hearts of those who defend it; but who could believe reports of what goes on every day among the inhabitants of some countries, who could really believe that one man alone may mistreat a hundred thousand and deprive them of their liberty? Who would credit such a report if he merely heard it, without being present to witness the event? And if this condition occurred only in distant lands and were reported to us, which one among us would not assume the tale to be imagined or invented, and not really true? Obviously there is no need of fighting to overcome this single tyrant, for he is automatically defeated if the country refuses consent to its own enslavement: it is not necessary to deprive him of anything, but simply to give him nothing; there is no need that the country make an effort to do anything for itself provided it does nothing against itself. It is therefore the inhabitants themselves who permit, or, rather, bring about, their own subjection, since by ceasing to submit they would put an end to their servitude. A people enslaves itself, cuts its own throat, when, having a choice between being vassals and being free men, it deserts its liberties and takes on the yoke, gives consent to its own misery, or, rather, apparently welcomes it. If it cost the people anything to recover its freedom, I should not urge action to this end, although there is nothing a human should hold more dear than the restoration of his own natural right, to change himself from a beast of burden back to a man, so to speak. I do not demand of him so much boldness; let him prefer the doubtful security of living wretchedly to the uncertain hope of living as he pleases. What then? If in order to have liberty nothing more is needed than to long for it, if only a simple act of the will is necessary, is there any nation in the world that considers a single wish too high a price to pay in order to recover rights which it ought to be ready to redeem at the cost of its blood, rights such that their loss must bring all men of honor to the point of feeling life to be unendurable and death itself a deliverance? http://www.constitution.org/la_boetie/serv_vol.htm
A Public Bank for Scotland Could Ensure Economic Sovereignty
Friday, 07 December 2012 00:00 By Ellen Brown, Truthout | News Analysis
http://truth-out.org/news/item/13175-a-public-bank-for-scotland-could-ensure-economic-sovereignty
With the Scottish National Party in control, independence is on the table. One way Scotland could exercise true economic sovereignty - and control over the national currency, credit and debt - would be to have its own publicly-owned bank, one that served the interests of the Scottish people.
The Royal Bank of Scotland (RBS) and the Bank of Scotland have been pillars of Scotland's economy and culture for more than three centuries. So when the RBS was nationalized by the London-based UK government following the 2008 banking crisis, and the Bank of Scotland was acquired by the London-based Lloyds Bank, it came as a shock to the Scots. They no longer owned their oldest and most venerable banks.
Another surprise turn of events was the triumph of the Scottish National Party (SNP) in the 2011 Scottish parliamentary election. Scotland is still part of the United Kingdom, but it has had its own parliament since 1999, similar to US states. The SNP has rallied around the call for independence from the UK since its founding in 1934, but it was a minority party until the 2011 victory, which gave it an overall majority in the Scottish Parliament.
Scottish independence is now on the table. A bill has been introduced to the Scottish Parliament with the intention of holding a referendum on the issue in 2014.
Arguments in favor of independence include that it will allow the Scottish people to make decisions for Scotland themselves, on such contentious issues as having nuclear weapons in their seas and being part of NATO. They can also directly access the profits from the North Sea oil off Scotland's coast.
Arguments against independence include the fact that Scotland's levels of public spending (which are higher than in the rest of the UK) would be difficult to sustain without raising taxes. North Sea oil revenues will eventually decline.
One way budgetary problems might be relieved would be for Scotland to have its own publicly-owned bank, one that served the interests of the Scottish people. True economic sovereignty means having control over the national currency, credit and debt.
The Public Bank Option
It was in that context that I was asked to give a presentation on public banking at RSA Scotland (the Royal Society of Arts) in Edinburgh on November 22. A special adviser and a civil servant from the Scottish government were among the attendees. The presentation was followed by public sector consultant Ralph Leishman, director of 4-consulting, who made the public bank option concrete with specific proposals fitting the Scottish context. He suggested that the Scottish Investment Bank (SIB) be licensed as a depository bank, on the model of the state-owned Bank of North Dakota. Lively debate followed.
The SIB is a division of Scottish Enterprise (SE), a government economic development body. SE encourages economic development, enterprise, innovation and investment in business, which is achieved by the SIB through the Scottish Loan Fund. As noted in a September 2011 government report titled, Government Economic Strategy:
Securing affordable finance remains a considerable challenge.... Evidence shows that while many large companies have significant cash holdings or can access capital markets directly, for most small- and medium-sized companies, bank lending remains the key source of finance. Unblocking this is key to helping the recovery gain traction.
The limitation of a public loan fund is that the money can be lent only to one borrower at a time. Invested as capital in a bank, on the other hand, public funds can be leveraged into nearly ten times that sum in loans. Liquidity to cover the loans is provided by deposits, which remain in the bank available to the depositors. Any shortage in liquidity can be covered by borrowing at low interest from other banks or the money market. As observed by Kurt Von Mettenheim, et al., in a 2008 report titled Government Banking: New Perspectives on Sustainable Development and Social Inclusion from Europe and South America (at page 196):
In terms of public policy, government banks can do more for less: Almost ten times more if one compares cash used as capital reserves by banks to other policies that require budgetary outflows.
Leishman stated that the SIB now has investment funds of £23.2 million from the Scottish government. Rounding this to £25 million, a public depository bank could have sufficient capital to back £250 million in loans. For deposits to cover the loans, the Scottish Government has £125 million on deposit with private banks, currently earning little or no interest. Adding just 14 percent of the General Fund cash and cash equivalent reserves held by Scotland's local governments would provide another £125 million, reaching the needed £250 million with six times that sum in local government revenues to spare.
The Model of the Bank of North Dakota
My assignment was to show what the government could do with its own bank, following the model of the Bank of North Dakota (BND). On the Saturday following the RSA event, the Scotsman published an article by Alf Young that summarized the issues and possibilities so well that I'm taking the liberty of abstracting from it here. North Dakota is currently the only US state to own its own depository bank. The BND was founded in 1919 by Norwegian and other immigrants, determined, through their Non-Partisan League, to stop rapacious Wall Street money men foreclosing on their farms. All state revenues must be deposited with the BND by law. The bank pays no bonuses, fees or commissions; does no advertising; and maintains no branches beyond the main office in Bismarck. The bank offers cheap credit lines to state and local government agencies. There are low-interest loans for designated project finance. The BND underwrites municipal bonds, funds disaster relief and supports student loans. It partners with local commercial banks to increase lending across the state and pays competitive interest rates on state deposits. For the past ten years, it has been paying a dividend to the state, with a quite small population of about 680,000, of some $30 million (£18.7 million) a year.
Young writes:
Intriguingly, North Dakota has not suffered the way much of the rest of the US - indeed much of the western industrialized world - has, from the banking crash and credit crunch of 2008; the subsequent economic slump; and the sovereign debt crisis that has afflicted so many. With an economy based on farming and oil, it has one of the lowest unemployment rates in the US, a rising population and a state budget surplus that is expected to hit $1.6 billion by next July. By then North Dakota's legacy fund is forecast to have swollen to around $1.2 billion.
With that kind of resilience, it's little wonder that 20 American states, some of them close to bankruptcy, are at various stages of legislating to form their own state-owned banks on the North Dakota model. There's a long-standing tradition of such institutions elsewhere too. Australia had a publicly-owned bank offering credit for infrastructure as early as 1912. New Zealand had one operating in the housing field in the 1930s. Up until 1974, the federal government in Canada borrowed from the Bank of Canada, effectively interest-free....
From our western perspective, we tend to forget that, globally, around 40 percent of banks are already publicly owned, many of them concentrated in the BRIC economies, Brazil, Russia, India and China.
Banking is not a market good or service. It is a vital part of societal infrastructure, which properly belongs in the public sector. By taking banking back, local governments could regain control of that very large slice (up to 40 per cent) of every public budget that currently goes to interest charged to finance investment programs through the private sector.
Recent academic studies by von Mettenheim et al. and Svetlana Andrianova et al show that countries with high degrees of government ownership of banking have grown much faster in the last decade than countries where banking is historically concentrated in the private sector. Government banks are also less corrupt and, surprisingly, have been more profitable in recent years than private banks.
Young writes:
Given the massive price we have all paid for our debt-fuelled crash, surely there is scope for a more fundamental re-think about what we really want from our banks and what structures of ownership are best suited to deliver on those aspirations?
... As we left Thursday's seminar, I asked another member of the audience, someone with more than 30 years' experience as a corporate financier, whether the concept of a publicly-owned bank has any chance of getting off the ground here. "I've no doubt it will happen," came the surprise response. "When I look at the way our collective addiction to debt has ballooned in my lifetime, I'd even say it's inevitable."
The Scots are full of surprises, and independence is in their blood. Recall the heroic battles of William Wallace and Robert the Bruce memorialized by Hollywood in the Academy Award-winning movie Braveheart. Perhaps the Scots will blaze a trail for economic sovereignty in the EU, just as North Dakotans did in the US. A publicly-owned bank could help Scotland take control of its own economic destiny, by avoiding unnecessary debt to a private banking system that has become a burden to the economy rather than a pillar in its support.
Copyright, Truthout.
America's 'actually existing' worker-owned capitalism
By Moria Herbst
Last week, retiring Minnesota grocery chain owner Joe Lueken did something unusual: he gave his business to his 400 employees. The story received widespread attention as a heartwarming, It's A Wonderful Life-esque act of beneficence.
But Lueken's decision was no one-off Christmas fairytale. In fact, Bob Moore, owner of Oregon-based cereal producer Bob's Red Mill Natural Foods, did exactly the same thing two years ago.
Their actions reflect the under-the-radar but growing trend of worker ownership in the United States. The surprising truth is that there are thousands of successful, majority worker-owned businesses in the United States. We're not just talking small-scale hippie co-ops: the largest majority employee-owned business is Florida-based Publix Super Markets, a $27bn company that employs 152,000 people. That's more workers than Costco (COST) and Whole Foods (WFM) combined.
At a time of high unemployment, soaring corporate profits and diminishing job quality, employee ownership offers an appealing, viable alternative to mainstream corporate capitalism. It's a way for workers to own "the means of production" without overthrowing the system – and without asking a gridlocked Congress to create a jobs program.
Far from some communist ideal, employee ownership is an all-American third way that both left and right can embrace. Worker advocates can applaud the model's more democratic structure, while free marketeers can admire its entrepreneurial spirit.
Workers who directly reap the fruits of their labor – rather than toil for higher returns for anonymous investors – are more motivated, productive, and creative. According to a study by Harvard and Rutgers researchers, companies with substantial employee ownership often outperform those without, because of lower staff turnover and stronger trust relationships at work.
Fortunately, the idea is catching on. Since 1975, the number of companies with partial employee ownership in the US has grown from 1,600 to more than 10,000 – about 10% of the American workforce. We sorely need these alternatives. For a nation fixated on the idea of individual liberty, Americans have a remarkable tolerance for undemocratic, top-down leadership at our workplaces, where, after all, we spend most of our waking hours.
In recent decades, the playing field between employers and employees – that is, between capital and labor – has become severely warped. Especially at the lower end of the skills spectrum, workers often face a lack of respect by management, erratic schedules, and punishment for trying to form a union. The vast majority of American workers are "at-will" – meaning, you can be fired for any reason. Perhaps your performance has lagged, or perhaps the boss doesn't like your new shoes.
If more enterprises were employee-owned, fewer workers would face this daily exploitation. Labor's share of the national income – now at its lowest point in recorded history – would rise. The ratio of average of CEO pay to worker pay (currently, an astounding 380:1) would shrink. Inequality, which harms society and hampers economic growth, would lessen.
Here's why. In publicly-traded corporations, the board of directors – nominated by a tiny number of outside investors – decides who runs the show and how profits are distributed. In employee-owned companies, workers themselves are the shareholders. Because stock does not trade publicly, the business is insulated from the pressures of the stock market and its obsession with short-term profit. Instead, the worker-owners can focus on long-term growth, sustainability, and fairness.
Part of that focus is executive pay. The base salary of the CEO of Publix, for example, was about $810,000 last year, far lower than than that of his grocery chain CEO counterparts. Publix isn't a slave to Wall Street's tendency to set bloated executive pay packages on expectations that share prices will magically balloon under new leadership.
Another focus is creating and maintaining good jobs for the long haul. While publicly-traded firms slash workers in a downturn, for example, an employee-owned company might choose to cut hours or pay for everyone to avoid layoffs.
To be sure, employee ownership is no panacea. Publix, for example, has faced employment lawsuits, including one over overtime pay. That's why proponents call for workplaces to be not only employee-owned, but also employee-directed. This is a more robustly democratic model in which workers become the board of directors of a company, making all decisions about what it produces how the spoils are distributed. Economist Richard Wolff details these kinds of models in his book, Democracy at Work: he often cites Mondragon, a successful Spanish conglomerate, as an example.
And then, there are the worker-owned John Lewis department stores in Britain, a $13bn-plus business. The company grows at a faster rate than competitors as it defies the low-wage retail business model, and offers workers solid compensation and pensions. The company's purpose, according to its constitution, is "the happiness of all its members, through their worthwhile and satisfying employment in a successful business". Sounds utopian … but it's happening every day.
Another example is Der Spiegel, the leading German consumer magazine, which is part-owned and managed by its employees. As print media collapses elsewhere, Spiegel is still going strong. When I did a fellowship there, a writer told me he and his colleagues skimp on travel expenses because they know it's their bottom line, too.
Academic studies show they're not alone. When you and your colleagues own the place, you're not going to steal a stapler or pad your hours. Trust and workplace ethics: isn't that what all those company retreats and office birthday celebrations have failed to accomplish?
http://www.guardian.co.uk/commentisfree/2012/dec/04/america-actually-existing-worker-owned-capitalism
Collective Workplaces Spell Job Security, Fair Treatment and Real-Life Democracy
Wednesday, 05 December 2012 00:00 By Graciela Razo, Truthout | Report
http://truth-out.org/news/item/13140-collective-workplaces-spell-job-security-fair-treatment-and-real-life-democracy
Amid the economic downturn in 2007, economist, professor, and Truthout contributor and advisory board member Richard Wolff laid out a vision for a radical reorganization of labor wherein employees had control of their workplaces. From choosing their work hours to coming to consensus about everyday business operations, employees would act together as their own bosses to combat inequality in the workplace.
The Story of Beyond Care
After facing insecure jobs, low wages and toxic unemployment, Susana Peralta and 19 other women turned that radical restructuring of the workplace into a reality. Their cooperative brainchild Beyond Care blossomed in 2008 as a new way to provide quality employment for their community in Sunset Park, Brooklyn.
The alternative workplace provides a necessary service of part- and full-time childcare where the women are their own bosses and chose their own hours and wages, a welcomed change from traditional workplaces.
"Not only did we create a space with fairer wages, but we found a way to employ our entire community," Peralta, the Beyond Care cooperative president said.
Peralta and her coworkers are exactly what Wolff and his new organization Democracy at Work, a collaboration with Truthout and several other partners, conceptualized for the future of employment. Democracy at Work was born in 2011 after Wolff's weekly radio show Economic Update, supported by Truthout, became syndicated in ten cities and listeners grew desperate for a solution to the abysmal employment and economic crisis.
"People wanted a solution, so we had to answer this demand," Wolff said. "The answer we came up with is democracy at work that would respond to the criticism we're making about the failures of the system to solve its own problems, to the failure of the old traditional socialism to be a model that attracts people and excites them." The fundamental idea of Democracy at Work is to create a society based on workers' self-directed enterprises. Fully egalitarian in every sense, workers run the business, share the assets and create a workspace that runs in harmony with not only its workers, but the entire community.
Wolff's argument is that workers in control of their own workplaces are much less likely to ship their own jobs overseas, underpay employees or pollute their own communities. As workers' enterprises become fully functioning, they benefit those who participate as workers as well as the customers and communities they serve. But before Beyond Care came into full operation, the women worked every day just to promote the business to get its first clients. Because they had to build up the daycare on an idea alone, with no money, it was completely up to them to gain momentum for the business. They put up flyers all over their neighborhood, trying to spread the word about their cooperative. After four years of word-of-mouth promotion and advertising, the collective got its first client. Now, Beyond Care has more clients than it can handle; the childcare center now has to turn down nearly seven clients each week because of its growing popularity. Parents love that their children are learning Spanish and that Beyond Care is entirely democratically run, Peralta added.
The women are constantly attending trainings and are currently working on expanding their services to meet the needs of children with disabilities. Unlike traditional workplaces, pleasing its customer-base is vital to Beyond Care's survival.
"If you work with an agency, you work to please your boss; when you work for a cooperative, you have more incentive to please the customers because your job depends directly on it," said collective developer Emma Yorra.
But perhaps most importantly, Peralta said, is the job security a collectively run workplace provides. No one worries about not having clients or being fired with nowhere to go. There are always clients and work to be done for the community, she said.
"We all have equal benefits and security now," Peralta said. "It isn't just for those of us who started the co-op; we're interested in something that benefits the entire community."
This "radical reorganization and democratization of enterprise," according to Wolff, gives workers complete control of their own workplaces, allows them to decide their wages and work fair hours, just as Beyond Care has been doing for the past four years. In a democratic workplace, no longer do bosses or agencies dictate how much employees should be paid - solving the issue of struggling workers barely able to pay for basic living expenses.
But job security would be the most beneficial outcome of worker self-directed enterprises, adds Jen Hill, co-founder of Democracy at Work. "When people are secure in their work-life, they have the freedom to participate in politics, home life and have time with their families, which would produce a more educated and creative society where everyone has a voice," Hill said. "Generations would be self-expressed, more equal and more secure. The opposite of what capitalism has done for us: insecurity and inequality."
Red Emma's Story
The freedom and democratic control of a cooperative gave the founding members of Red Emma's bookstore in Baltimore, Maryland, the freedom to expand further than a traditional business. Collectivized at the end of 2004, Red Emma's has flourished into a fully sustainable business, complete with a cafe serving fair-trade coffee, a space for political discussions, a free computer lab and a template for others to begin their own collective.
"We wanted to build an infrastructure that creates the world we want to see and a space that allows us to put our politics into practice," said Kate Khatib, a Red Emma's founding collective member. "Emma's is an experiment, a laboratory to see if these things we talk about in our literature actually work, and if not, why doesn't it work? What can we do instead?"
Owned and operated by 14 collective members and a group of volunteers, Red Emma's grew into a product of its own politics, giving each member a say in every aspect of the operation. But Emma's still has a few of the same obstacles many other independent bookshops across the country have. The collective still has times when it struggles with book sales or building repairs.
And although Emma's is an open collective, it takes six months to become a full member. After three months of volunteering for five hours each week and a series of checkpoints and reviews, the collective must come to a complete consensus before inviting someone to join. Then after three more months of working as a provisional member, they are eligible to become a collective member and officially added to Red Emma's ownership documents.
"Collectives offer a way to change the way we think of work," John Duda, another founding collective member said. "It's a space that changes people's expectations of what labor can look like."
Consensus becomes the basis of each workday. Every member and volunteer knows which lightbulb goes where, how much money was brought in that week and where the cooperative's produce comes from (local, family-owned grocery stores) and is encouraged to participate in each business decision.
Weekly collective meetings are run so every participant has a chance to speak. Each member focuses on a certain aspect of Emma's: public relations, book ordering, volunteers and logistics. Direct democracy developed Emma's into one of Baltimore's destination bookstores and into a worker self-directed enterprise that's able to be replicated by other business ventures.
"It's rewarding to see that it is possible to build something that is sustainable, that has a capacity to reproduce itself as an institution," Duda said. "It opens a space where people learn to live a little differently."
Democracy at Work is spreading this template to make it easier for collectives and cooperatives to sprout in cities where unemployment is deteriorating entire neighborhoods. The organization is developing informational videos to make these methods more accessible, and there are plans to organize a training institution where ideas are manifested into concrete business plans.
"We are developing a movement. We have the basic idea. We have a very enthusiastic audience," Wolff said. "It's growing, but the trick is how to find a way to glue people together, give them enough to do that they feel part of something because that's what they want."
Copyright, Truthout.
The Counterrevolutionary Constitution
http://fubarandgrill.org/node/1431
We've all been taught in school that the Founders of the United States of America fought a revolution that freed the colony from British rule. That much is true. They even drew up a list of complaints to explain why that revolution was necessary, which was published as The Declaration of Independence. In it they clearly enumerated the instances of tyranny that the colonists would no longer passively endure, but also laid out the principles of democracy they wished to establish:
"We hold these truths to be self-evident, that all men are created equal, that they are endowed by the Creator with certain unalienable Rights, that among these are Life, Liberty and the pursuit of Happiness --That to secure these rights, Governments are instituted among Men, deriving their just powers from the consent of the governed."
The lie we were taught to believe is that the Constitution of the United States of America established such a government and was the legitimate result and continuation of the revolution. It was not. It was a counterrevolutionary document and it totally betrayed the revolution.
It was not at all self-evident to the Framers that all men are created equal. In the Constitution they counted some men as equal but others as only three fifths persons. This was done to placate the slave-holding states into ratifying the Constitution.1
The Framers not only didn't secure the unalienable rights of Blacks to liberty, but denied those rights by allowing slavery, which is the opposite of liberty, to continue.
Although the Founders stated clearly that governments derive their just powers from the consent of the governed, the new Constitution didn't bother to ask for the consent of the majority of the governed. Blacks, Native Americans, indentured servants, women, and landless workers were certainly to be governed under the new Constitution, but they were not granted the right to vote. White male landowners were allowed to vote, but to ensure that the United States would be a plutocracy where those who owned the country ruled it, even their votes were not granted the decisive role they would have in a democracy. They were prohibited from voting for Senators or for President and Vice-President, and the Constitution made Congress, not citizens, the sole "Judge of the Elections, Returns and Qualifications of its own Members...." There was no guarantee that the popular vote even had to be counted, no less taken into account, and it could be overridden by the Electoral College, Congress, or the Supreme Court.
The revolution, fought to establish equality and democracy, had been betrayed by a Constitution that condoned inequality and established a plutocracy.
But the Framers didn't stop there. In their counterrevolutionary zeal, and against the wishes of Thomas Jefferson and other delegates, they gave an unelected body, the Supreme Court, the power to made decisions that could not be appealed. Such totalitarian power in the hands of unelected people is contrary to the most basic principles of democracy. This was exactly the sort of power that King George had and that the colonists revolted against. They were able to, and frequently did, petition the king for redress of grievances, but they had no vote in his decisions and his edicts could not be appealed. In establishing the Supreme Court, the Framers once again betrayed the revolution and established an undemocratic distribution of power that the Founders had shed blood to rid us of.
There are many more examples, some of which I've mentioned in my other writings, but these should suffice to demonstrate that the Constitution of the United States of America was a counterrevolutionary document and a betrayal of the democratic principles set out in the Declaration of Independence.
http://fubarandgrill.org/node/1085
The Value of Voting
http://fubarandgrill.org/node/1431
During a long discussion on one of his forums, long-term Democratic Party organizer and former Democrat Congressional candidate Ray Lutz accused me of being opposed to voting. This was my response:
A democratic system of government is one in which power is vested in the hands of the people. That's the dictionary definition and even Ray agreed to it.
An undemocratic system of government is one in which power is vested in the hands of the government. That government could be a dictatorship, a monarchy, a plutocracy, an oligarchy, or even a pseudo-democracy, but if power is vested in the hands of the government rather than in the hands of the people, the system does not meet the definition of a democratic form of government.
In a democratic form of government, where power is vested in the hands of the people, voting is the most precious right of all, as it is the way that the people exercise the power vested in them, either directly by voting on issues, budgets, and policies, or indirectly by voting for representatives who are obligated to represent their constituents and can be directly recalled by the people at any time that they fail to represent the people who elected them.
In an undemocratic form of government, where power is vested in the hands of the government rather than in the hands of the people, voting is totally worthless and a waste of time, as the people do not have power and the government doesn't have to count their votes, can miscount and/or ignore their votes, can overrule the popular vote, and elected representatives are not obligated to represent their constituents but can represent their personal beliefs or philosophies, their big donors, or whatever they wish, and cannot be held accountable as long as they continue in office, which is the only time that people need them to represent the interests of the people.
In an undemocratic form of government, voters can hope that their votes might be counted, can hope that their elected officials might represent them, but have no power to ensure that their votes are counted or that their elected officials actually represent them.
The system makes all the difference. As an analogy, breathing is a good thing and we humans couldn't survive without being able to breathe. But underwater or in a toxic environment filled with lethal gas, breathing can bring about death more quickly than holding one's breath and trying to escape. Breathing isn't always a good thing, it is only a good thing in an environment with oxygen suitable for human life.
The same is true of voting. In a democratic system, voting is precious and essential. In an undemocratic system, it can be fatal, as it can allow the destruction of the economy, military adventurism, obstacles to basic human rights such as jobs, education, food, clothing, shelter, and health care, and other tragic consequences of allowing government to exercise uncontrolled power rather than vesting power in the hands of the people.
Most people in the US today are opposed to our government's ongoing wars of aggression. Even those who are uninformed and uneducated, who aren't aware that historically, the way that most empires fell was because they became militarily overextended, sense that there is something wrong with spending trillions of dollars on foreign wars while basic domestic needs go unmet. But because we do not have a democratic system of government, we have no power to end the wars. The best we can do is vote for candidates we hope might end the wars, but if, like Obama, they expand the wars instead of ending them, there is nothing we can do about it because our government has the power to start or end wars and we do not. If wars were on the ballot, it could only be as a nonbinding referendum, as there is no Constitutional way to force the government to obey the will of the people. The Constitution vested power in the government rather than in the hands of the people.
I do not oppose voting any more than I oppose breathing. I oppose voting only when it occurs within an undemocratic form of government, thus legitimizing an undemocratic form of government and consenting to be governed undemocratically, just as I oppose breathing only when in a toxic or anaerobic environment where breathing can be fatal. Just as I would want to try to help anyone trapped in a toxic or anaerobic environment hold their breath until they could escape, I want to try to help people trapped in an undemocratic form of government withhold their votes until they can escape. If I tell a drowning person to hold their breath until they can get their head above water, I am not condemning breathing. If I tell people not to vote until they have a democratic form of government, I am not condemning voting. In both cases, I am trying to preserve life, liberty, and the pursuit of happiness, and to promote the general welfare.
http://fubarandgrill.org/node/1189
Now Make Me Do It: The Mythical Apathy of the Electorate
http://my.firedoglake.com/mymarkx/2012/10/19/now-make-me-do-it-the-mythical-apathy-of-the-electorate/#
By: mymarkx Friday October 19, 2012 10:52 pm
Many liberals and progressives, not to mention conservatives and wingnuts, bemoan the apathy of the electorate. It isn’t enough to just vote, they insist, once you elect somebody you have to actively force them to represent you, and they cite Franklin D. Roosevelt who said, “I agree with you, I want to do it, now make me do it.” The problem, they claim, isn’t with the system or with our representatives, but with us for not being organized and active enough to make our representatives represent us. Many elected representatives claim that they would like to represent their constituents, but, like FDR, they can’t unless they are made to.
If true, this would reflect poorly on us as a people. We have a basically good system, and some good representatives, but we are just too lazy and apathetic to make our representatives represent us.
This is all a lie. Let me give you an example. Back during the Bush administration a lot of people wanted to see Bush and Cheney impeached. In one district the desire for impeachment was so high that activists were able to collect signatures from more than 80% of the residents asking their representative, John Olver, to support impeachment. But when he was formally presented with the petition, his response was, “Spare me! I’m well aware that the overwhelming majority of my constituents want me to support impeachment. I will not.” His response would have been the same if the petition had signatures from 100% of his constituents. It wasn’t that people were too apathetic to care, or too lazy to try to make him represent them, it was that our Constitution never gave people the power to exercise their will through their elected representatives. As both the Bush and Obama administrations made clear, our government does not allow public opinion to influence policy decisions. We are not a democracy or a republic. In the United States power is vested in the hands of the government, not in the hands of the people.
In both a democracy and a republic, by definition, supreme power over government is vested in the hands of the people. In a democracy, the people exercise their power directly by voting on budgets, policy issues, and other matters of import, but in a republic the people exercise their power indirectly through their elected officials. In the United States we have no such power. We can ask our representatives to represent us, we can protest if they don’t, but we have no way to make them do our will because we have no power over them. Once they are elected, they are free to represent us, if they wish, or they can, if they choose, represent their big campaign donors, their personal ideologies, the interests of a foreign country, or anything else they want. We can petition until we turn blue and protest until we get ourselves shot, but we have no way to sway them. Sure we can wait until their terms of office, the only time they’re supposed to represent us, are over, and then try to elect somebody else who can’t be held accountable, but while our representatives are in office, while they are supposed to be representing us, we cannot make them do so.
Of course we can ask Congress to impeach them, but Congress doesn’t like to impeach its own Members. If one Member was impeached, other Members might be subject to impeachment in revenge, so that’s a can of worms they prefer not to open. Sometimes they threaten impeachment, or even begin impeachment proceedings, but they don’t impeach. There have been impeachments of some district judges, but no sitting President, Supreme Court Justice, or Member of Congress has ever been impeached: http://en.wikipedia.org/wiki/Impeachment_in_the_United_States
If your representatives appears to be representing you, it is because they chose to or their big donors told them to, not because you made them do it. You have no power to make them do anything. When you vote, you are not voting for representatives, you are voting for petty tyrants who may or may not represent you and over whom you have no power whatsoever. Once their term of office is over and they are no longer representing you, you cannot bring back to life the dead from the wars they funded with your taxpayer dollars or renounce the debts they incurred that your granchildren will still be paying . The damage they do while in office can be irreparable and you have no control over them while they’re in office. You can try to elect somebody else, somebody who tells smoother lies, but you will have no real power over them either.
Of course with corporate money even in local politics, gerrymandered districts, easily hacked and totally unverifiable central tabulators, you can never know for sure that your vote for a new representative was counted at all, no less counted for the candidate you tried to vote for.
Yet approximately 50% of the electorate vote anyway, hoping against hope that their vote might be counted and that they might be represented. The other half of us know better.
In a democratic form of government, a vote is the most precious right of all because it is the way that people exercise their power over government, either directly or through their representatives.
We do not have a democratic form of government in the United States. The Constitution gave us a plutocracy where we have no power over government to exercise.
So don’t berate yourself and your neighbors for not making your representatives do their jobs. You can’t. The 39 plutocrats who wrote the Constitution, the wealthy elite 1% of their time, made sure that you wouldn’t have that power, as they didn’t trust the “mob and rabble” of democracy and wanted those who owned the country, people like themselves, to always rule the country.
You’re not apathetic. You’ve been had.
A template for OWS to model. http://evergreencooperatives.com/
I have a question about Article 2? how are you going to pay for roads, or did I misread.
That's the one that everyone inquires about.
No direct taxes does not mean no taxes. It means no direct taxes which means that indirect taxes are utilized to compensate for anything funded by direct taxes just as they did before 1913 and even afterwards.
Ok then, what is the basis for the tax? Is it a head tax? Is it regressive, progressive?
It's not a tax. It's a prohibition of mandatory direct taxation. How indirect taxation is applied, as always, remains a matter determined by the government and the people for each case. Anyone electing to have withholding applied to their income for support of social welfare services would be free to do so and may even have a national vote to determine what the amounts should be. Of course, such a vote would first require the establishment of amendment #5.
I think this leaves you with no progressivity and I disagree with that.
The option of progressivity isn't excluded. With indirect taxation, luxury goods can easily be highly taxed while basic necessities can have little to no tax at all. A sliding scale can be applied to all items and services to apply progressivity.
A convoluted approach to a simple problem. Why?
No, simply a readily available option if progressivity is determined to be feasible.
There is already is a straightforward means to implement progressivity. Obviously, you aren't in favor of progressivity. Do you turn a blind eye to income disparity? Removing even the progressivity that remains today after significant recent reductions will exacerbate a situation that is much more drastic now than it was a couple of decades ago.
Obviously, I'm not in favor of the slavery that automatically results from direct taxation. A person's labor belongs to themself, not to the state. A person's property belongs to them, not to the state. So long as the state compels you to pay it for your own labor to sustain yourself and annually pay for the property you've already bought, it is the true owner of both for which you can never be free. Income disparity cannot exist without people collectively choosing to work for private business owners instead of for themselves. That's what the Cooperative Employment Service would be for. Progressivity can be implimented under direct taxation or under indirect taxation as clearly pointed out but freedom can only exist under indirect taxation. The source of taxes is irrelevent for the overall economy, but the source of taxes is very relevent for individual freedom.
Taxes are taxes not voluntary contributions. This is the 21st century. You can tax income, expenditures, property or transactions. They all have direct and secondary consequences. Individual freedom is never total in a society. The transactions between individuals organizations and levels of the state are always complex. Arbitrarily removing any of the possible transactions from the process is not demonstrably beneficial and serves to foster the belief that it will provide a benefit to some that doesn't accrue to others. In short, it is an unnecessary distortion.of what the payer gives up in exchange for what they receive.
I see that my concern is well founded.
The payer doesn't give up anything. The payer is freed from personal impositions that had never been federally imposed before 1913. It is no more arbitrarily removed than it had been arbitrarily imposed. In the 21st century you can kill people with drones, starve nations seeking energy independence, pass laws to suppress certain segments of the population from voting, bail out financial thieves while foreclosing on their victims, and force people to either patronize insurance companies or be penalized with a tax. Just because things are commonly done certainly doesn't mean that they should be. Taxes can be paid without infringing upon the liberty of the people or taxes can be paid by infringing upon the liberty of the people. To impose an unnecessary infringement upon the liberty of the people when the same results can be obtained without the infringement indicates an intentional compromise of the people's liberties.
I see that my concern for liberty is well founded.
It is about a social compact, or contract if you will, and ignoring it doesn't cause its nonexistence. Trying to ignore an implicit exchange leaves one side with unsatisfied consideration and gives some the opportunity to unilaterally redefine the transaction after the fact. Better to make them all explicit and with boundaries. Amendments need to be principles that can be tested by anecdotes but this one fails the test for me. I think it will for others when the fully understand it. I believe taxes are necessary but the implied consequences of nonpayment are a restriction of liberty that is real and should not be ignored. There are lots of people paying the price for not paying the taxes they have implicitly agreed to.
Everyone already pays indirect taxes whether they know it or not thus this clearly has nothing to do with a social contract or not paying taxes.
There are two forms of taxation. One is compatible with liberty while the other isn't.
One form has always existed at the federal level while the other form at the federal level isn't even 100 years old and has done nothing to prevent income disparity. In fact, the other form became federally instituted in the same year that the Federal Reserve Bank was established and merely serves to enrich its owners http://occupywallst.org/forum/free-democracy-amendment/#comment-752291 while keeping an entire nation in perpetual debt.
Both individually and nationally, one form is always incompatible with freedom while the other isn't. As both produce the same monetary results, it's a simple chioce between the one that allows for freedom and the one that doesn't.
I agree with the spirit, I'm not a lawyer, but may the wording could clarify that part. suggestion.
Your suggestion has been taken and the wording has now been revised.
Glad I can help, goona take a look....Much better.
The wording clarifies it just fine. Although there are plenty of people who are initially unaware of indirect taxation, there are plenty of people who are fully aware and even have a movement to amend the 16th Amendment so that being taxed directly is done away for a national sales tax. Anyone who reads #2 and overlooks the automatic consequence of indirect taxation fulfilling the current role of direct taxation can be easily reminded of it thereby contributing to greater public awareness of the issue.
Well I agree with you 90%. I take issue with #2. If you remove the ability for this nation to defend its self you will quickly learn how spoiled the American people have become. The people who have died in the creation and defense of this nation of the People, by the People, for the People, will curse your existence.
Number two is about the removal of direct taxation, not national defense.
how do you fund national defense? not to mention the infrastructure required to move troops and supplies?
The same way it had always been funded before 1913 and even after...indirect taxes.
The source of taxes is irrelevent for the economy, but the source of taxes is very relevent for individual freedom.
hmm, you may have one me over...I'll give it some thought.
The Benefits of Buying Locally http://reclaimdemocracy.org/local_business_benefits/
Each year brings more national chains displacing locally-owned businesses throughout the country. We see clones replace unique establishments. People across the country are losing sense of community in their town, and consider this trend a symptom, but could it be a cause as well? Also, what are the impacts of this trend on our economic well-being?
It seems obvious that we do business where we perceive we receive the best value for our time and money. Perceptions, however, are not always accurate when we are lacking some of the essential information for fully informed decisions. We see and hear the omnipresent ads of corporate chains everyday, but are collectively under-informed about the many important values independent businesses provide us individually and as a community.
Some economists would call the chain encroachment a natural trend. Tough for the family who owns the small business, but it doesn’t really affect the economy. Overall sales may even go up a little when a chain drives out a small independent, so what’s the problem?
The disappearance of local businesses leaves a social and economic void that is palpable and real – even when it is unmeasured. The quality of life of a community changes in ways that macroeconomics is slow to measure, or ignores completely. Let’s look at some of the issues.
It’s time to consider the real costs to a community that loses its local business base. Independent local businesses employ a wide array of supporting services. They hire architects, designers, cabinet shops, sign makers and contractors for construction. Opportunities grow for local accountants, insurance brokers, computer consultants, attorneys, advertising agencies and others to help run it. Local retailers and distributors also carry a higher percentage of locally-made goods than the chains, creating more jobs for local producers.
In contrast, a new chain store typically puts in place a clone of other units, eliminates the need for local planning, and uses a minimum of local goods and services. In a company-owned store, the profits are promptly exported to corporate headquarters. These factors lead local independent merchants create a multiplier effect in the local economy of 3 – 3 1/2 times that of a chain outlet (the multiplier difference in non-retail businesses is generally lower, but no less important).While many communities focus on sales tax revenue, we need to remember that the one-time tax revenue is only one part of the economic picture.
Small manufacturers are also affected since they rely on local retailers to give their new products a chance. Local retailers are more free to take chances with the goods of a new manufacturer, or a product that is not part of a national sales plan. Therefore, small manufacturers and a wide variety of service industries have a clear stake in the nationwide health of local retailers.
In the larger picture, sales of the 500 largest corporations grew 700% in the past 20 years, yet those corporations are now net disemployers, firing more people than they hire despite record profits. That our economy is still in decent health is testimony to the employment generated by small business during this time. We need to recognize the impact of our dollars and support institutions that benefit our common interests.
For example, when 3,000 or so national independent booksellers or music shops buy for their local customers’ tastes, the cumulative effect is demand for a wide variety of ideas and music. This makes accessible controversial books or music from new artists with the expectation that there will be a market somewhere within a variety of stores. As fewer giant corporations dominate both production and sales, our options – determined by a powerful few – will be drastically reduced.
Our freedom of choice is imperiled when a few buyers from national chains choose what reaches consumers. This may be only mildly disturbing for most consumer goods, but truly frightening when you consider the impact on our choice of news sources, books, music and other modes of expression.
Local owners with much of their life savings invested in their businesses have a natural interest in the long-term health of the community. Community-based businesses are essential to charitable endeavors, frequently serving on local boards, and supporting a variety of causes. Yes, there are some corporate chains that give back to towns in which they do business, but anyone who raises funds for local non-profits will tell you that independents are their base of support. Not all local businesses are models to follow, and corporate chains are not inherently bad, but the overall impacts are clear: local businesses play a vital role in our community that corporate chains rarely do, while chains often even undermine community interests.
Recurring Problems
The loss of local businesses hasn’t just resulted from free market economics; it’s had plenty of help. Favoritism from large manufacturers toward corporate chains such as “promotional allowances” (free advertising), takes different forms, many of them illegal under anti-trust laws. Enforcement of these laws, created to protect consumers and communities, is an important step in solving these problems.
Local officials nationwide often fall for the seductions and political appeal of luring new national chains. They often look at promises of jobs and tax revenues, but fail to consider the greater losses that occur when the local business base is undermined. We see examples nationwide of tax and regulatory breaks worth millions used to lure out-of state corporations. Why should these businesses enjoy favors that our community-based businesses do not?
Let’s make future decisions based on full-cost accounting, and create a level (or better) playing field for local businesses with our policies; the chains already have enough laws rigged in their favor nationally.
Hope For The Future
For long-term progress, a conceptual change also is necessary. We need to consciously plan that future with rules that will encourage the values we want reflected in our communities. And each time we spend a dollar, we would do well to weigh the full value of our choices, not solely to ourselves immediately, but for the future we want in our own hometowns.
By Jeff Milchen, former executive director of Reclaim Democracy and co-founder of the American Independent Business Alliance (AMIBA) http://www.amiba.net/ . Please contact AMIBA for reprint permission (and updates to the article) or for assistance launching buy local campaigns or other initiatives to support community-based enterprise.
While good causes, you are still fundamentally confused. The notion of freedom simply changes by necessity when a civilization has reached the end of growth. The Founders never anticipated this. Individualism (which defined America) must change to cooperation (the future).
Confused about what?
Meaning, you're still ranting about individual freedom (like the Founders did 230 years ago), when the notion of the individual is no longer paramount. It's the global future now which is at stake.
The reality of the individual will always be paramount as long as individuals continue to thrive on the earth. Cooperation for the global future in no way bars individual freedom.
Did you miss the concept of "end of growth"? Growth without a purpose is cancer. Even your body stops growing at some point, why? Understand that and you'll understand that the trajectory of an individual within a society is not linear. It's a circle that loops back until you see "everybody is my brother/sister".
End of growth has nothing to do with having individual rights.
Yes it does, because what you do now affects everybody else. Everything you do has an "externality" somewhere.
What you do affects everyone whether you have individual rights or not thus securing the rights of individuals confers no barrier to cooperation for the future.
Good luck getting this thing ratified.
The most that I can do (if even that) is to bring it to the people's attention. Whether or not it ever gets ratified is up to the people.
We'd be lucky to get something that overturns Citizens United passed by congress, and ratified by the states, meaningful campaign finance reform, Glass Steagall restored, etc., let alone something as far reaching as the above proposal (which doesn't seem very likely in today's political environment).
I think the best way to approach any of these matters is at the state level first. Utilize ballot initiative to pass amendments at the state level and use the momentum from that to push for national ratification. If national ratification doesn't crystalize, at least enactment will exist at the individual state level for states with ballot initiative and perhaps even a few without. I'm not sure but I think Vermont is a non-ballot initiative state that's overturning Citizens United. In the end, it all comes down to the willingness of the people to either vote for initiatives (where able) or to only vote for the candidates clearly commited to the desired amendments.
"In December 1907, 1 entered the United States Senate and served there for 18 years. Within ninety days after I entered the Senate, on the 25th day of February 1908, 1 analyzed completely the Panic of 1907; showed its causes, how it could be cured, and how depressions could be prevented in the future. My text was stability in the value of money."
"I was made Chairman of the Committee on Banking and Currency of the United States Senate on March 5, 1913, and immediately drafted a Bill called the Federal Reserve Bill. In drafting this Bill I was greatly assisted by the results of four years work done by the National Monetary Commission. That Commission's report consisted of 32 volumes, and an auxiliary library of 2500 volumes. It had been established on my request from the floor of the United States Senate."
"In July 1913, Hon. Carter Glass joined me in presenting to the Senate and to the House the so-called Federal Reserve Bill which had been prepared by me the previous March, but which had been expanded, and contained provisions with which I was not entirely content. My Committee was immediately called together to take testimony on this Senate Bill, and after 3,000 pages of printed testimony had been taken, my colleagues in the Senate authorized me to write another Bill. I thereupon had the Senate strike out the Bill that had been prepared in the House and substitute the Bill which I had originally prepared. The Senate adopted the Bill written by me without a change of word. In the Bill introduced in July, in which the Hon. Carter Glass joined me, I had inserted a provision requiring that the powers of the Reserve System be employed in the service of commerce and to promote a stable price level. The meaning of this, of course, was to establish and maintain the stable value of money under mandate. This mandatory provision was stricken out in the House under the leadership of Hon. Carter Glass. I was unable to keep this mandatory provision in the Bill because of the secret hostilities developed against it, the origin of which at that time I did not fully understand."
"Under the administrations of Wilson, Harding, Coolidge and Hoover, this Act was diverted from its proper purpose on the advice of some who controlled the policies of a number of the largest banks."
"In the campaign of 1920, under the pretext of lowering the cost of living, those in charge of some of the largest banks demanded the contraction of credit and currency. This was done in spite of nine protests I had made on the floor of the Senate between January and June of 1920. Policies pursued by those in charge of the Central Federal Reserve Banks resulted in raising the value of money 80%, from an index of 60 in May 1920 to an index of 107 in June 1921."
"Again, under President Hoover, the contraction of credit took place on such a colossal scale as to force the dollar index (purchasing power) to 166. The consequence was universal bankruptcy, every bank in the United States being forced to suspend operations at the close of Hoover's services."
"The purpose of this book is to bring before the American people the knowledge that they must have regarding the nature and manipulations of their money system. In my opinion, America faces a crisis which may result in the loss of our Representative Constitutional Government unless every man and woman, rich or poor, young or old; doctor, lawyer, merchant, laborer, educator, clergyman, social worker, society leader; will bestir himself or herself toward the problem of bringing the fundamental truths of monetary science to every fireside."
"It is time for intelligent Americans to examine their money system and learn how to make simple but fundamental changes. Those who own insurance policies and savings accounts must bestir themselves to protect those accumulations. It is an obvious fact that the value of savings accounts and insurance policies will be destroyed unless correct measures are taken to restore property values, employment, and equitable raw material price levels. Instead of allowing our entire social order to be changed, we should examine the fundamental cause of our economic chaos. Making a few intelligent and scientific changes in the operation of our money system will eliminate the dangers of our being afflicted by false principles."
"It is hopeless to think that a few public- spirited citizens in some of the key cities of the United States can accomplish this enormous benefit. They cannot; their handicaps are many. The truths themselves are very simple, but many of the newspapers and publishing companies allow themselves to be used to carry misinformation to the American public, while neglecting to print the truths. Honest money principles are understandable to every one when the money subject is presented in its true light."
"America will remain in a deplorable condition only so long as the "Let George do it" attitude continues."
"Americans must bestir themselves to eliminate the causes of this business depression and social disorder, and restore prosperity and opportunities to the American people. Loyal Americans realize that the possession of knowledge carries with it the responsibility of dissemination."
"It required the assistance of every loyal American to help win the World War. In my opinion, the American people have more at stake today than they had at the time of the World War, not that I at all deprecate the glorious services rendered by men in uniform. But I believe the future of our nation and the principles for which it has stood, were less in jeopardy then than they are today. It is not necessary that you make the sacrifices you made at the time of the World War, but the cooperation of every one in this important educational program is absolutely necessary."
"The solution of the problem to protect our homes does not rest with a few leaders in a distant city. It is necessary that every man and woman appoint himself and herself a leader. Honest Money Groups must be formed in every block, in every precinct throughout the United States, and in every rural community. The rural community centers and schoolhouses can be most profitably employed this winter in showing the American farmers how simply they can solve all of their own problems. Their grave troubles have been caused not by overproduction, but by money manipulations frequently executed upon foreign advice and to harmonize with foreign "policies." The result has been the extraction of dollars of a distorted purchasing power from the American farmer. Collecting dollars of such unfair purchasing power has deprived many American farmers of their homes, and all farmers of their share in the industrial products which this nation is so well equipped to manufacture and distribute."
"The principal reason for endorsing this book is that I feel it is an intelligent vehicle for the dissemination of the truths which must be understood in every home and crystallized into legislation as quickly as possible."
Robert L. Owen,
New York City,
October 29, 1934.
From the forward of "Money Creators" by Gertrude Coogan http://www.archive.org/stream/MoneyCreators/Coogan-MoneyCreators-WhoCreatesMoney-WhoShouldCreateIt1935_djvu.txt
"A great industrial nation is controlled by its system of credit. Our system of credit is concentrated. The growth of the Nation, therefore, and all our activities are in the hands of a few men... We have come to be one of the worst ruled, one of the most completely controlled and dominated, governments in the civilized world—no longer a government by free opinion, no longer a government by conviction and the vote of the majority, but a government by the opinion and the duress of small groups of dominant men."
Woodrow Wilson in 1916 as quoted by former Senator Robert L. Owen (the Father of the Federal Reserve Act) in "National Economy and the Banking System," Senate Documents No. 23, p. 100, 76th Congress, 1st Session, 1939. http://ia700500.us.archive.org/11/items/NationalEconomyAndTheBankingSystemOfTheUnitedStates/NationalEconomyAndTheBankingSystem.pdf
"We may congratulate ourselves that this cruel war is nearing its end. It has cost a vast amount of treasure and blood. . . . It has indeed been a trying hour for the Republic; but I see in the near future a crisis approaching that unnerves me and causes me to tremble for the safety of my country. As a result of the war, corporations have been enthroned and an era of corruption in high places will follow, and the money power of the country will endeavor to prolong its reign by working upon the prejudices of the people until all wealth is aggregated in a few hands and the Republic is destroyed. I feel at this moment more anxiety for the safety of my country than ever before, even in the midst of war. God grant that my suspicions may prove groundless."
Abraham Lincoln in a letter to Col. William F. Elkins dated November 21, 1864
President Jackson's Veto Message Regarding the Bank of the United States; July 10, 1832
VETO MESSAGE.
WASHINGTON, July 10, 1832.
To the Senate.
The bill " to modify and continue " the act entitled "An act to incorporate the subscribers to the Bank of the United States " was presented to me on the 4th July instant. Having considered it with that solemn regard to the principles of the Constitution which the day was calculated to inspire, and come to the conclusion that it ought not to become a law, I herewith return it to the Senate, in which it originated, with my objections.
A bank of the United States is in many respects convenient for the Government and useful to the people. Entertaining this opinion, and deeply impressed with the belief that some of the powers and privileges possessed by the existing bank are unauthorized by the Constitution, subversive of the rights of the States, and dangerous to the liberties of the people, I felt it my duty at an early period of my Administration to call the attention of Congress to the practicability of organizing an institution combining all its advantages and obviating these objections. I sincerely regret that in the act before me I can perceive none of those modifications of the bank charter which are necessary, in my opinion, to make it compatible with justice, with sound policy, or with the Constitution of our country.
The present corporate body, denominated the president, directors, and company of the Bank of the United States, will have existed at the time this act is intended to take effect twenty years. It enjoys an exclusive privilege of banking under the authority of the General Government, a monopoly of its favor and support, and, as a necessary consequence, almost a monopoly of the foreign and domestic exchange. The powers, privileges, and favors bestowed upon it in the original charter, by increasing the value of the stock far above its par value, operated as a gratuity of many millions to the stockholders.
An apology may be found for the failure to guard against this result in the consideration that the effect of the original act of incorporation could not be certainly foreseen at the time of its passage. The act before me proposes another gratuity to the holders of the same stock, and in many cases to the same men, of at least seven millions more. This donation finds no apology in any uncertainty as to the effect of the act. On all hands it is conceded that its passage will increase at least so or 30 per cent more the market price of the stock, subject to the payment of the annuity of $200,000 per year secured by the act, thus adding in a moment one-fourth to its par value. It is not our own citizens only who are to receive the bounty of our Government. More than eight millions of the stock of this bank are held by foreigners. By this act the American Republic proposes virtually to make them a present of some millions of dollars. For these gratuities to foreigners and to some of our own opulent citizens the act secures no equivalent whatever. They are the certain gains of the present stockholders under the operation of this act, after making full allowance for the payment of the bonus.
Every monopoly and all exclusive privileges are granted at the expense of the public, which ought to receive a fair equivalent. The many millions which this act proposes to bestow on the stockholders of the existing bank must come directly or indirectly out of the earnings of the American people. It is due to them, therefore, if their Government sell monopolies and exclusive privileges, that they should at least exact for them as much as they are worth in open market. The value of the monopoly in this case may be correctly ascertained. The twenty-eight millions of stock would probably be at an advance of 50 per cent, and command in market at least $42,000,000, subject to the payment of the present bonus. The present value of the monopoly, therefore, is $17,000,000, and this the act proposes to sell for three millions, payable in fifteen annual installments of $200,000 each.
It is not conceivable how the present stockholders can have any claim to the special favor of the Government. The present corporation has enjoyed its monopoly during the period stipulated in the original contract. If we must have such a corporation, why should not the Government sell out the whole stock and thus secure to the people the full market value of the privileges granted? Why should not Congress create and sell twenty-eight millions of stock, incorporating the purchasers with all the powers and privileges secured in this act and putting the premium upon the sales into the Treasury?
But this act does not permit competition in the purchase of this monopoly. It seems to be predicated on the erroneous idea that the present stockholders have a prescriptive right not only to the favor but to the bounty of Government. It appears that more than a fourth part of the stock is held by foreigners and the residue is held by a few hundred of our own citizens, chiefly of the richest class. For their benefit does this act exclude the whole American people from competition in the purchase of this monopoly and dispose of it for many millions less than it is worth. This seems the less excusable because some of our citizens not now stockholders petitioned that the door of competition might be opened, and offered to take a charter on terms much more favorable to the Government and country.
But this proposition, although made by men whose aggregate wealth is believed to be equal to all the private stock in the existing bank, has been set aside, and the bounty of our Government is proposed to be again bestowed on the few who have been fortunate enough to secure the stock and at this moment wield the power of the existing institution. I can not perceive the justice or policy of this course. If our Government must sell monopolies, it would seem to be its duty to take nothing less than their full value, and if gratuities must be made once in fifteen or twenty years let them not be bestowed on the subjects of a foreign government nor upon a designated and favored class of men in our own country. It is but justice and good policy, as far as the nature of the case will admit, to confine our favors to our own fellow-citizens, and let each in his turn enjoy an opportunity to profit by our bounty. In the bearings of the act before me upon these points I find ample reasons why it should not become a law.
It has been urged as an argument in favor of rechartering the present bank that the calling in its loans will produce great embarrassment and distress. The time allowed to close its concerns is ample, and if it has been well managed its pressure will be light, and heavy only in case its management has been bad. If, therefore, it shall produce distress, the fault will be its own, and it would furnish a reason against renewing a power which has been so obviously abused. But will there ever be a time when this reason will be less powerful? To acknowledge its force is to admit that the bank ought to be perpetual, and as a consequence the present stockholders and those inheriting their rights as successors be established a privileged order, clothed both with great political power and enjoying immense pecuniary advantages from their connection with the Government.
The modifications of the existing charter proposed by this act are not such, in my view, as make it consistent with the rights of the States or the liberties of the people. The qualification of the right of the bank to hold real estate, the limitation of its power to establish branches, and the power reserved to Congress to forbid the circulation of small notes are restrictions comparatively of little value or importance. All the objectionable principles of the existing corporation, and most of its odious features, are retained without alleviation.
The fourth section provides " that the notes or bills of the said corporation, although the same be, on the faces thereof, respectively made payable at one place only, shall nevertheless be received by the said corporation at the bank or at any of the offices of discount and deposit thereof if tendered in liquidation or payment of any balance or balances due to said corporation or to such office of discount and deposit from any other incorporated bank." This provision secures to the State banks a legal privilege in the Bank of the United States which is withheld from all private citizens. If a State bank in Philadelphia owe the Bank of the United States and have notes issued by the St. Louis branch, it can pay the debt with those notes, but if a merchant, mechanic, or other private citizen be in like circumstances he can not by law pay his debt with those notes, but must sell them at a discount or send them to St. Louis to be cashed. This boon conceded to the State banks, though not unjust in itself, is most odious because it does not measure out equal justice to the high and the low, the rich and the poor. To the extent of its practical effect it is a bond of union among the banking establishments of the nation, erecting them into an interest separate from that of the people, and its necessary tendency is to unite the Bank of the United States and the State banks in any measure which may be thought conducive to their common interest.
The ninth section of the act recognizes principles of worse tendency than any provision of the present charter.
It enacts that " the cashier of the bank shall annually report to the Secretary of the Treasury the names of all stockholders who are not resident citizens of the United States, and on the application of the treasurer of any State shall make out and transmit to such treasurer a list of stockholders residing in or citizens of such State, with the amount of stock owned by each." Although this provision, taken in connection with a decision of the Supreme Court, surrenders, by its silence, the right of the States to tax the banking institutions created by this corporation under the name of branches throughout the Union, it is evidently intended to be construed as a concession of their right to tax that portion of the stock which may be held by their own citizens and residents. In this light, if the act becomes a law, it will be understood by the States, who will probably proceed to levy a tax equal to that paid upon the stock of banks incorporated by themselves. In some States that tax is now I per cent, either on the capital or on the shares, and that may be assumed as the amount which all citizen or resident stockholders would be taxed under the operation of this act. As it is only the stock held in the States and not that employed within them which would be subject to taxation, and as the names of foreign stockholders are not to be reported to the treasurers of the States, it is obvious that the stock held by them will be exempt from this burden. Their annual profits will therefore be I per cent more than the citizen stockholders, and as the annual dividends of the bank may be safely estimated at 7 per cent, the stock will be worth 10 or 15 per cent more to foreigners than to citizens of the United States. To appreciate the effects which this state of things will produce, we must take a brief review of the operations and present condition of the Bank of the United States.
By documents submitted to Congress at the present session it appears that on the 1st of January, 1832, of the twenty-eight millions of private stock in the corporation, $8,405,500 were held by foreigners, mostly of Great Britain. The amount of stock held in the nine Western and Southwestern States is $140,200, and in the four Southern States is $5,623,100, and in the Middle and Eastern States is about $13,522,000. The profits of the bank in 1831, as shown in a statement to Congress, were about $3,455,598; of this there accrued in the nine western States about $1,640,048; in the four Southern States about $352,507, and in the Middle and Eastern States about $1,463,041. As little stock is held in the West, it is obvious that the debt of the people in that section to the bank is principally a debt to the Eastern and foreign stockholders; that the interest they pay upon it is carried into the Eastern States and into Europe, and that it is a burden upon their industry and a drain of their currency, which no country can bear without inconvenience and occasional distress. To meet this burden and equalize the exchange operations of the bank, the amount of specie drawn from those States through its branches within the last two years, as shown by its official reports, was about $6,000,000. More than half a million of this amount does not stop in the Eastern States, but passes on to Europe to pay the dividends of the foreign stockholders. In the principle of taxation recognized by this act the Western States find no adequate compensation for this perpetual burden on their industry and drain of their currency. The branch bank at Mobile made last year $95,140, yet under the provisions of this act the State of Alabama can raise no revenue from these profitable operations, because not a share of the stock is held by any of her citizens. Mississippi and Missouri are in the same condition in relation to the branches at Natchez and St. Louis, and such, in a greater or less degree, is the condition of every Western State. The tendency of the plan of taxation which this act proposes will be to place the whole United States in the same relation to foreign countries which the Western States now bear to the Eastern. When by a tax on resident stockholders the stock of this bank is made worth 10 or 15 per cent more to foreigners than to residents, most of it will inevitably leave the country.
Thus will this provision in its practical effect deprive the Eastern as well as the Southern and Western States of the means of raising a revenue from the extension of business and great profits of this institution. It will make the American people debtors to aliens in nearly the whole amount due to this bank, and send across the Atlantic from two to five millions of specie every year to pay the bank dividends.
In another of its bearings this provision is fraught with danger. Of the twenty-five directors of this bank five are chosen by the Government and twenty by the citizen stockholders. From all voice in these elections the foreign stockholders are excluded by the charter. In proportion, therefore, as the stock is transferred to foreign holders the extent of suffrage in the choice of directors is curtailed. Already is almost a third of the stock in foreign hands and not represented in elections. It is constantly passing out of the country, and this act will accelerate its departure. The entire control of the institution would necessarily fall into the hands of a few citizen stockholders, and the ease with which the object would be accomplished would be a temptation to designing men to secure that control in their own hands by monopolizing the remaining stock. There is danger that a president and directors would then be able to elect themselves from year to year, and without responsibility or control manage the whole concerns of the bank during the existence of its charter. It is easy to conceive that great evils to our country and its institutions millet flow from such a concentration of power in the hands of a few men irresponsible to the people.
Is there no danger to our liberty and independence in a bank that in its nature has so little to bind it to our country? The president of the bank has told us that most of the State banks exist by its forbearance. Should its influence become concentered, as it may under the operation of such an act as this, in the hands of a self-elected directory whose interests are identified with those of the foreign stockholders, will there not be cause to tremble for the purity of our elections in peace and for the independence of our country in war? Their power would be great whenever they might choose to exert it; but if this monopoly were regularly renewed every fifteen or twenty years on terms proposed by themselves, they might seldom in peace put forth their strength to influence elections or control the affairs of the nation. But if any private citizen or public functionary should interpose to curtail its powers or prevent a renewal of its privileges, it can not be doubted that he would be made to feel its influence.
Should the stock of the bank principally pass into the hands of the subjects of a foreign country, and we should unfortunately become involved in a war with that country, what would be our condition? Of the course which would be pursued by a bank almost wholly owned by the subjects of a foreign power, and managed by those whose interests, if not affections, would run in the same direction there can be no doubt. All its operations within would be in aid of the hostile fleets and armies without. Controlling our currency, receiving our public moneys, and holding thousands of our citizens in dependence, it would be more formidable and dangerous than the naval and military power of the enemy.
If we must have a bank with private stockholders, every consideration of sound policy and every impulse of American feeling admonishes that it should be purely American. Its stockholders should be composed exclusively of our own citizens, who at least ought to be friendly to our Government and willing to support it in times of difficulty and danger. So abundant is domestic capital that competition in subscribing for the stock of local banks has recently led almost to riots. To a bank exclusively of American stockholders, possessing the powers and privileges granted by this act, subscriptions for $200,000,000 could be readily obtained. Instead of sending abroad the stock of the bank in which the Government must deposit its funds and on which it must rely to sustain its credit in times of emergency, it would rather seem to be expedient to prohibit its sale to aliens under penalty of absolute forfeiture.
It is maintained by the advocates of the bank that its constitutionality in all its features ought to be considered as settled by precedent and by the decision of the Supreme Court. To this conclusion I can not assent. Mere precedent is a dangerous source of authority, and should not be regarded as deciding questions of constitutional power except where the acquiescence of the people and the States can be considered as well settled. So far from this being the case on this subject, an argument against the bank might be based on precedent. One Congress, in 1791, decided in favor of a bank; another, in 1811, decided against it. One Congress, in 1815, decided against a bank; another, in 1816, decided in its favor. Prior to the present Congress, therefore, the precedents drawn from that source were equal. If we resort to the States, the expressions of legislative, judicial, and executive opinions against the bank have been probably to those in its favor as 4 to 1. There is nothing in precedent, therefore, which, if its authority were admitted, ought to weigh in favor of the act before me.
If the opinion of the Supreme Court covered the whole ground of this act, it ought not to control the coordinate authorities of this Government. The Congress, the Executive, and the Court must each for itself be guided by its own opinion of the Constitution. Each public officer who takes an oath to support the Constitution swears that he will support it as he understands it, and not as it is understood by others. It is as much the duty of the House of Representatives, of the Senate, and of the President to decide upon the constitutionality of any bill or resolution which may be presented to them for passage or approval as it is of the supreme judges when it may be brought before them for judicial decision. The opinion of the judges has no more authority over Congress than the opinion of Congress has over the judges, and on that point the President is independent of both. The authority of the Supreme Court must not, therefore, be permitted to control the Congress or the Executive when acting in their legislative capacities, but to have only such influence as the force of their reasoning may deserve.
But in the case relied upon the Supreme Court have not decided that all the features of this corporation are compatible with the Constitution. It is true that the court have said that the law incorporating the bank is a constitutional exercise of power by Congress; but taking into view the whole opinion of the court and the reasoning by which they have come to that conclusion, I understand them to have decided that inasmuch as a bank is an appropriate means for carrying into effect the enumerated powers of the General Government, therefore the law incorporating it is in accordance with that provision of the Constitution which declares that Congress shall have power " to make all laws which shall be necessary and proper for carrying those powers into execution. " Having satisfied themselves that the word "necessary" in the Constitution means needful," "requisite," "essential," "conducive to," and that "a bank" is a convenient, a useful, and essential instrument in the prosecution of the Government's "fiscal operations," they conclude that to "use one must be within the discretion of Congress " and that " the act to incorporate the Bank of the United States is a law made in pursuance of the Constitution;" "but, " say they, "where the law is not prohibited and is really calculated to effect any of the objects intrusted to the Government, to undertake here to inquire into the degree of its necessity would be to pass the line which circumscribes the judicial department and to tread on legislative ground."
The principle here affirmed is that the "degree of its necessity," involving all the details of a banking institution, is a question exclusively for legislative consideration. A bank is constitutional, but it is the province of the Legislature to determine whether this or that particular power, privilege, or exemption is "necessary and proper" to enable the bank to discharge its duties to the Government, and from their decision there is no appeal to the courts of justice. Under the decision of the Supreme Court, therefore, it is the exclusive province of Congress and the President to decide whether the particular features of this act are necessary and proper in order to enable the bank to perform conveniently and efficiently the public duties assigned to it as a fiscal agent, and therefore constitutional, or unnecessary and improper, and therefore unconstitutional.
Without commenting on the general principle affirmed by the Supreme Court, let us examine the details of this act in accordance with the rule of legislative action which they have laid down. It will be found that many of the powers and privileges conferred on it can not be supposed necessary for the purpose for which it is proposed to be created, and are not, therefore, means necessary to attain the end in view, and consequently not justified by the Constitution.
The original act of incorporation, section 2I, enacts "that no other bank shall be established by any future law of the United States during the continuance of the corporation hereby created, for which the faith of the United States is hereby pledged: Provided, Congress may renew existing charters for banks within the District of Columbia not increasing the capital thereof, and may also establish any other bank or banks in said District with capitals not exceeding in the whole $6,000,000 if they shall deem it expedient." This provision is continued in force by the act before me fifteen years from the ad of March, 1836.
If Congress possessed the power to establish one bank, they had power to establish more than one if in their opinion two or more banks had been " necessary " to facilitate the execution of the powers delegated to them in the Constitution. If they possessed the power to establish a second bank, it was a power derived from the Constitution to be exercised from time to time, and at any time when the interests of the country or the emergencies of the Government might make it expedient. It was possessed by one Congress as well as another, and by all Congresses alike, and alike at every session. But the Congress of 1816 have taken it away from their successors for twenty years, and the Congress of 1832 proposes to abolish it for fifteen years more. It can not be "necessary" or "proper" for Congress to barter away or divest themselves of any of the powers-vested in them by the Constitution to be exercised for the public good. It is not " necessary " to the efficiency of the bank, nor is it "proper'' in relation to themselves and their successors. They may properly use the discretion vested in them, but they may not limit the discretion of their successors. This restriction on themselves and grant of a monopoly to the bank is therefore unconstitutional.
In another point of view this provision is a palpable attempt to amend the Constitution by an act of legislation. The Constitution declares that "the Congress shall have power to exercise exclusive legislation in all cases whatsoever" over the District of Columbia. Its constitutional power, therefore, to establish banks in the District of Columbia and increase their capital at will is unlimited and uncontrollable by any other power than that which gave authority to the Constitution. Yet this act declares that Congress shall not increase the capital of existing banks, nor create other banks with capitals exceeding in the whole $6,000,000. The Constitution declares that Congress shall have power to exercise exclusive legislation over this District "in all cases whatsoever," and this act declares they shall not. Which is the supreme law of the land? This provision can not be "necessary" or "proper" or constitutional unless the absurdity be admitted that whenever it be "necessary and proper " in the opinion of Congress they have a right to barter away one portion of the powers vested in them by the Constitution as a means of executing the rest.
On two subjects only does the Constitution recognize in Congress the power to grant exclusive privileges or monopolies. It declares that "Congress shall have power to promote the progress of science and useful arts by securing for limited times to authors and inventors the exclusive right to their respective writings and discoveries." Out of this express delegation of power have grown our laws of patents and copyrights. As the Constitution expressly delegates to Congress the power to grant exclusive privileges in these cases as the means of executing the substantive power " to promote the progress of science and useful arts," it is consistent with the fair rules of construction to conclude that such a power was not intended to be granted as a means of accomplishing any other end. On every other subject which comes within the scope of Congressional power there is an ever-living discretion in the use of proper means, which can not be restricted or abolished without an amendment of the Constitution. Every act of Congress, therefore, which attempts by grants of monopolies or sale of exclusive privileges for a limited time, or a time without limit, to restrict or extinguish its own discretion in the choice of means to execute its delegated powers is equivalent to a legislative amendment of the Constitution, and palpably unconstitutional.
This act authorizes and encourages transfers of its stock to foreigners and grants them an exemption from all State and national taxation. So far from being "necessary and proper" that the bank should possess this power to make it a safe and efficient agent of the Government in its fiscal operations, it is calculated to convert the Bank of the United States into a foreign bank, to impoverish our people in time of peace, to disseminate a foreign influence through every section of the Republic, and in war to endanger our independence.
The several States reserved the power at the formation of the Constitution to regulate and control titles and transfers of real property, and most, if not all, of them have laws disqualifying aliens from acquiring or holding lands within their limits. But this act, in disregard of the undoubted right of the States to prescribe such disqualifications, gives to aliens stockholders in this bank an interest and title, as members of the corporation, to all the real property it may acquire within any of the States of this Union. This privilege granted to aliens is not "necessary" to enable the bank to perform its public duties, nor in any sense "proper," because it is vitally subversive of the rights of the States.
The Government of the United States have no constitutional power to purchase lands within the States except "for the erection of forts, magazines, arsenals, dockyards, and other needful buildings," and even for these objects only "by the consent of the legislature of the State in which the same shall be." By making themselves stockholders in the bank and granting to the corporation the power to purchase lands for other purposes they assume a power not granted in the Constitution and grant to others what they do not themselves possess. It is not necessary to the receiving, safe-keeping, or transmission of the funds of the Government that the bank should possess this power, and it is not proper that Congress should thus enlarge the powers delegated to them in the Constitution.
The old Bank of the United States possessed a capital of only $11,000,000, which was found fully sufficient to enable it with dispatch and safety to perform all the functions required of it by the Government. The capital of the present bank is $35,000,000-at least twenty-four more than experience has proved to be necessary to enable a bank to perform its public functions. The public debt which existed during the period of the old bank and on the establishment of the new has been nearly paid off, and our revenue will soon be reduced. This increase of capital is therefore not for public but for private purposes.
The Government is the only "proper" judge where its agents should reside and keep their offices, because it best knows where their presence will be "necessary." It can not, therefore, be "necessary" or "proper" to authorize the bank to locate branches where it pleases to perform the public service, without consulting the Government, and contrary to its will. The principle laid down by the Supreme Court concedes that Congress can not establish a bank for purposes of private speculation and gain, but only as a means of executing the delegated powers of the General Government. By the same principle a branch bank can not constitutionally be established for other than public purposes. The power which this act gives to establish two branches in any State, without the injunction or request of the Government and for other than public purposes, is not "necessary" to the due execution of the powers delegated to Congress.
The bonus which is exacted from the bank is a confession upon the face of the act that the powers granted by it are greater than are "necessary" to its character of a fiscal agent. The Government does not tax its officers and agents for the privilege of serving it. The bonus of a million and a half required by the original charter and that of three millions proposed by this act are not exacted for the privilege of giving "the necessary facilities for transferring the public funds from place to place within the United States or the Territories thereof, and for distributing the same in payment of the public creditors without charging commission or claiming allowance on account of the difference of exchange," as required by the act of incorporation, but for something more beneficial to the stockholders. The original act declares that it (the bonus) is granted " in consideration of the exclusive privileges and benefits conferred by this act upon the said bank, " and the act before me declares it to be "in consideration of the exclusive benefits and privileges continued by this act to the said corporation for fifteen years, as aforesaid." It is therefore for "exclusive privileges and benefits" conferred for their own use and emolument, and not for the advantage of the Government, that a bonus is exacted. These surplus powers for which the bank is required to pay can not surely be "necessary" to make it the fiscal agent of the Treasury. If they were, the exaction of a bonus for them would not be " proper."
It is maintained by some that the bank is a means of executing the constitutional power "to coin money and regulate the value thereof." Congress have established a mint to coin money and passed laws to regulate the value thereof. The money so coined, with its value so regulated, and such foreign coins as Congress may adopt are the only currency known to the Constitution. But if they have other power to regulate the currency, it was conferred to be exercised by themselves, and not to be transferred to a corporation. If the bank be established for that purpose, with a charter unalterable without its consent, Congress have parted with their power for a term of years, during which the Constitution is a dead letter. It is neither necessary nor proper to transfer its legislative power to such a bank, and therefore unconstitutional.
By its silence, considered in connection with the decision of the Supreme Court in the case of McCulloch against the State of Maryland, this act takes from the States the power to tax a portion of the banking business carried on within their limits, in subversion of one of the strongest barriers which secured them against Federal encroachments. Banking, like farming, manufacturing, or any other occupation or profession, is a business, the right to follow which is not originally derived from the laws. Every citizen and every company of citizens in all of our States possessed the right until the State legislatures deemed it good policy to prohibit private banking by law. If the prohibitory State laws were now repealed, every citizen would again possess the right. The State banks are a qualified restoration of the right which has been taken away by the laws against banking, guarded by such provisions and limitations as in the opinion of the State legislatures the public interest requires. These corporations, unless there be an exemption in their charter, are, like private bankers and banking companies, subject to State taxation. The manner in which these taxes shall be laid depends wholly on legislative discretion. It may be upon the bank, upon the stock, upon the profits, or in any other mode which the sovereign power shall will.
Upon the formation of the Constitution the States guarded their taxing power with peculiar jealousy. They surrendered it only as it regards imports and exports. In relation to every other object within their jurisdiction, whether persons, property, business, or professions, it was secured in as ample a manner as it was before possessed. All persons, though United States officers, are liable to a poll tax by the States within which they reside. The lands of the United States are liable to the usual land tax, except in the new States, from whom agreements that they will not tax unsold lands are exacted when they are admitted into the Union. Horses, wagons, any beasts or vehicles, tools, or property belonging to private citizens, though employed in the service of the United States, are subject to State taxation. Every private business, whether carried on by an officer of the General Government or not, whether it be mixed with public concerns or not, even if it be carried on by the Government of the United States itself, separately or in partnership, falls within the scope of the taxing power of the State. Nothing comes more fully within it than banks and the business of banking, by whomsoever instituted and carried on. Over this whole subject-matter it is just as absolute, unlimited, and uncontrollable as if the Constitution had never been adopted, because in the formation of that instrument it was reserved without qualification.
The principle is conceded that the States can not rightfully tax the operations of the General Government. They can not tax the money of the Government deposited in the State banks, nor the agency of those banks in remitting it; but will any man maintain that their mere selection to perform this public service for the General Government would exempt the State banks and their ordinary business from State taxation? Had the United States, instead of establishing a bank at Philadelphia, employed a private banker to keep and transmit their funds, would it have deprived Pennsylvania of the right to tax his bank and his usual banking operations? It will not be pretended. Upon what principal, then, are the banking establishments of the Bank of the United States and their usual banking operations to be exempted from taxation ? It is not their public agency or the deposits of the Government which the States claim a right to tax, but their banks and their banking powers, instituted and exercised within State jurisdiction for their private emolument-those powers and privileges for which they pay a bonus, and which the States tax in their own banks. The exercise of these powers within a State, no matter by whom or under what authority, whether by private citizens in their original right, by corporate bodies created by the States, by foreigners or the agents of foreign governments located within their limits, forms a legitimate object of State taxation. From this and like sources, from the persons, property, and business that are found residing, located, or carried on under their jurisdiction, must the States, since the surrender of their right to raise a revenue from imports and exports, draw all the money necessary for the support of their governments and the maintenance of their independence. There is no more appropriate subject of taxation than banks, banking, and bank stocks, and none to which the States ought more pertinaciously to cling.
It can not be necessary to the character of the bank as a fiscal agent of the Government that its private business should be exempted from that taxation to which all the State banks are liable, nor can I conceive it "proper" that the substantive and most essential powers reserved by the States shall be thus attacked and annihilated as a means of executing the powers delegated to the General Government. It may be safely assumed that none of those sages who had an agency in forming or adopting our Constitution ever imagined that any portion of the taxing power of the States not prohibited to them nor delegated to Congress was to be swept away and annihilated as a means of executing certain powers delegated to Congress.
If our power over means is so absolute that the Supreme Court will not call in question the constitutionality of an act of Congress the subject of which "is not prohibited, and is really calculated to effect any of the objects intrusted to the Government," although, as in the case before me, it takes away powers expressly granted to Congress and rights scrupulously reserved to the States, it becomes us to proceed in our legislation with the utmost caution. Though not directly, our own powers and the rights of the States may be indirectly legislated away in the use of means to execute substantive powers. We may not enact that Congress shall not have the power of exclusive legislation over the District of Columbia, but we may pledge the faith of the United States that as a means of executing other powers it shall not be exercised for twenty years or forever. We may not pass an act prohibiting the States to tax the banking business carried on within their limits, but we may, as a means of executing our powers over other objects, place that business in the hands of our agents and then declare it exempt from State taxation in their hands. Thus may our own powers and the rights of the States, which we can not directly curtail or invade, be frittered away and extinguished in the use of means employed by us to execute other powers. That a bank of the United States, competent to all the duties which may be required by the Government, might be so organized as not to infringe on our own delegated powers or the reserved rights of the States I do not entertain a doubt. Had the Executive been called upon to furnish the project of such an institution, the duty would have been cheerfully performed. In the absence of such a call it was obviously proper that he should confine himself to pointing out those prominent features in the act presented which in his opinion make it incompatible with the Constitution and sound policy. A general discussion will now take place, eliciting new light and settling important principles; and a new Congress, elected in the midst of such discussion, and furnishing an equal representation of the people according to the last census, will bear to the Capitol the verdict of public opinion, and, I doubt not, bring this important question to a satisfactory result.
Under such circumstances the bank comes forward and asks a renewal of its charter for a term of fifteen years upon conditions which not only operate as a gratuity to the stockholders of many millions of dollars, but will sanction any abuses and legalize any encroachments.
Suspicions are entertained and charges are made of gross abuse and violation of its charter. An investigation unwillingly conceded and so restricted in time as necessarily to make it incomplete and unsatisfactory discloses enough to excite suspicion and alarm. In the practices of the principal bank partially unveiled, in the absence of important witnesses, and in numerous charges confidently made and as yet wholly uninvestigated there was enough to induce a majority of the committee of investigation-a committee which was selected from the most able and honorable members of the House of Representatives-to recommend a suspension of further action upon the bill and a prosecution of the inquiry. As the charter had yet four years to run, and as a renewal now was not necessary to the successful prosecution of its business, it was to have been expected that the bank itself, conscious of its purity and proud of its character, would have withdrawn its application for the present, and demanded the severest scrutiny into all its transactions. In their declining to do so there seems to be an additional reason why the functionaries of the Government should proceed with less haste and more caution in the rene\val of their monopoly.
The bank is professedly established as an agent of the executive branch of the Government, and its constitutionality is maintained on that ground. Neither upon the propriety of present action nor upon the provisions of this act was the Executive consulted. It has had no opportunity to say that it neither needs nor wants an agent clothed with such powers and favored by such exemptions. There is nothing in its legitimate functions which makes it necessary or proper. Whatever interest or influence, whether public or private, has given birth to this act, it can not be found either in the wishes or necessities of the executive department, by which present action is deemed premature, and the powers conferred upon its agent not only unnecessary, but dangerous to the Government and country.
It is to be regretted that the rich and powerful too often bend the acts of government to their selfish purposes. Distinctions in society will always exist under every just government. Equality of talents, of education, or of wealth can not be produced by human institutions. In the full enjoyment of the gifts of Heaven and the fruits of superior industry, economy, and virtue, every man is equally entitled to protection by law; but when the laws undertake to add to these natural and just advantages artificial distinctions, to grant titles, gratuities, and exclusive privileges, to make the rich richer and the potent more powerful, the humble members of society-the farmers, mechanics, and laborers-who have neither the time nor the means of securing like favors to themselves, have a right to complain of the injustice of their Government. There are no necessary evils in government. Its evils exist only in its abuses. If it would confine itself to equal protection, and, as Heaven does its rains, shower its favors alike on the high and the low, the rich and the poor, it would be an unqualified blessing. In the act before me there seems to be a wide and unnecessary departure from these just principles.
Nor is our Government to be maintained or our Union preserved by invasions of the rights and powers of the several States. In thus attempting to make our General Government strong we make it weak. Its true strength consists in leaving individuals and States as much as possible to themselves-in making itself felt, not in its power, but in its beneficence; not in its control, but in its protection; not in binding the States more closely to the center, but leaving each to move unobstructed in its proper orbit.
Experience should teach us wisdom. Most of the difficulties our Government now encounters and most of the dangers which impend over our Union have sprung from an abandonment of the legitimate objects of Government by our national legislation, and the adoption of such principles as are embodied in this act. Many of our rich men have not been content with equal protection and equal benefits, but have besought us to make them richer by act of Congress. By attempting to gratify their desires we have in the results of our legislation arrayed section against section, interest against interest, and man against man, in a fearful commotion which threatens to shake the foundations of our Union. It is time to pause in our career to review our principles, and if possible revive that devoted patriotism and spirit of compromise which distinguished the sages of the Revolution and the fathers of our Union. If we can not at once, in justice to interests vested under improvident legislation, make our Government what it ought to be, we can at least take a stand against all new grants of monopolies and exclusive privileges, against any prostitution of our Government to the advancement of the few at the expense of the many, and in favor of compromise and gradual reform in our code of laws and system of political economy.
I have now done my duty to my country. If sustained by my fellow citizens, I shall be grateful and happy; if not, I shall find in the motives which impel me ample grounds for contentment and peace. In the difficulties which surround us and the dangers which threaten our institutions there is cause for neither dismay nor alarm. For relief and deliverance let us firmly rely on that kind Providence which I am sure watches with peculiar care over the destinies of our Republic, and on the intelligence and wisdom of our countrymen. Through His abundant goodness and heir patriotic devotion our liberty and Union will be preserved.
ANDREW JACKSON.
Thank you for sharing this. It's nice to be reminded that we have as a nation have fought this fight before and won. The powers that might be more entrenchef but the tools we have are much greater.
This gave me an idea. Send copies of this and the constitution to congress and the president. Email amd real mail.
"This has been the course of England, and her examples have fearful influence on us. In copying her we do not seem to consider that like premises induce like consequences. The bank mania is one of the most threatening of these imitations. It is raising up a moneyed aristocracy in our country which has already set the government at defiance, and although forced at length to yield a little on this first essay of their strength, their principles are unyielded and unyielding. These have taken deep root in the hearts of that class from which our legislators are drawn, and the sop to Cerberus from fable has become history. Their principles lay hold of the good, their pelf of the bad, and thus those whom the Constitution had placed as guards to its portals, are sophisticated or suborned from their duties."
Thomas Jefferson in a letter to Josephus B. Stuart dated May 10, 1817
"Hamilton’s financial system had then past. It had two objects. First as a puzzle, to exclude popular understanding & inquiry. Secondly, as a machine for the corruption of the legislature; for he avowed the opinion that man could be governed by one of two motives only, force or interest: force he observed, in this country, was out of the question; and the interests therefore of the members must be laid hold of, to keep the legislature in unison with the Executive. And with grief and shame it must be acknowledged that his machine was not without effect. That even in this, the birth of our government, some members were found sordid enough to bend their duty to their interests, and to look after personal, rather than public good."
"It is well known that, during the war, the greatest difficulty we encountered was the want of money or means, to pay our souldiers who fought, or our farmers, manufacturers & merchants who furnished the necessary supplies of food & clothing for them. After the expedient of paper money had exhausted itself, certificates of debt were given to the individual creditors, with assurance of payment, so soon as the U.S. should be able. But the distresses of these people often obliged them to part with these for the half, the fifth, and even a tenth of their value; and Speculators had made a trade of cozening them from the holders, by the most fraudulent practices and persuasions that they would never be paid. In the bill for funding & paying these, Hamilton made no difference between the original holders, & the fraudulent purchasers of this paper."
"Great & just repugnance arose at putting these two classes of creditors on the same footing, and great exertions were used to pay to the former the full value, and to the latter the price only which he had paid, with interest. But this would have prevented the game which was to be played, & for which the minds of greedy members were already tutored and prepared. When the trial of strength on these several efforts had indicated the form in which the bill would finally pass, this being known within doors sooner than without, and especially than to those who were in distant parts of the Union, the base scramble began. Couriers & relay horses by land, and swift sailing pilot boats by sea, were flying in all directions. Active partners & agents were associated & employed in every state, town and country neighborhood, and this paper was bought up at 5/ and even as low as 2/ in the pound, before the holder knew that Congress had already provided for it’s redemption at par. Immense sums were thus filched from the poor & ignorant, and fortunes accumulated by those who had themselves been poor enough before."
"Men thus enriched by the dexterity of a leader, would follow of course the chief who was leading them to fortune, and become the zealous instruments of all his enterprises. This game was over, and another was on the carpet at the moment of my arrival; and to this I was most ignorantly & innocently made to hold the candle. This fiscal maneuvre is well known by the name of the Assumption. Independantly of the debts of Congress, the states had, during the war, contracted separate and heavy debts; and Massachusetts particularly in an absurd attempt, absurdly conducted, on the British post of Penobscot: and the more debt Hamilton could rake up, the more plunder for his mercenaries."
"This money, whether wisely or foolishly spent, was pretended to have been spent for general purposes, and ought therefore to be paid from the general purse. But it was objected that nobody knew what these debts were, what their amount, or what their proofs. No matter; we will guess them to be 20. millions. But of these 20. millions we do not know how much should be reimbursed to one state, nor how much to another. No matter; we will guess. And so another scramble was set on foot among the several states, and some got much, some little, some nothing. But the main object was obtained, the phalanx of the treasury was reinforced by additional recruits."
"This measure produced the most bitter & angry contests ever known in Congress, before or since the union of the states. I arrived in the midst of it. But a stranger to the ground, a stranger to the actors on it, so long absent as to have lost all familiarity with the subject, and as yet unaware of it’s object, I took no concern in it. The great and trying question however was lost in the H. of Representatives. So high were the feuds excited by this subject, that on it’s rejection, business was suspended. Congress met and adjourned from day to day without doing any thing, the parties being too much out of temper to do business together. The Eastern members particularly, who, with Smith from South Carolina, were the principal gamblers in these scenes, threatened a secession and dissolution."
"Hamilton was in despair. As I was going to the President’s one day, I met him in the street. He walked me backwards & forwards before the President’s door for half an hour. He painted pathetically the temper into which the legislature had been wrought, the disgust of those who were called the Creditor states, the danger of the secession of their members, and the separation of the states. He observed that the members of the administration ought to act in concert, that tho’ this question was not of my department, yet a common duty should make it a common concern; that the President was the center on which all administrative questions ultimately rested, and that all of us should rally around him, and support with joint efforts measures approved by him; and that the question having been lost by a small majority only, it was probable that an appeal from me to the judgment and discretion of some of my friends might effect a change in the vote, and the machine of government, now suspended, might be again set into motion. I told him that I was really a stranger to the whole subject; not having yet informed myself of the system of finances adopted, I knew not how far this was a necessary sequence; that undoubtedly if it’s rejection endangered a dissolution of our union at this incipient stage, I should deem that the most unfortunate of all consequences, to avert which all partial and temporary evils should be yielded. I proposed to him however to dine with me the next day, and I would invite another friend or two, bring them into conference together, and I thought it impossible that reasonable men, consulting together coolly, could fail, by some mutual sacrifices of opinion, to form a compromise which was to save the union."
"The discussion took place. I could take no part in it, but an exhortatory one, because I was a stranger to the circumstances which should govern it. But it was finally agreed that, whatever importance had been attached to the rejection of this proposition, the preservation of the union, & of concord among the states was more important, and that therefore it would be better that the vote of rejection should be rescinded, to effect which some members should change their votes. But it was observed that this pill would be peculiarly bitter to the Southern States, and that some concomitant measure should be adopted to sweeten it a little to them."
"There had before been propositions to fix the seat of government either at Philadelphia, or at Georgetown on the Potomac; and it was thought that by giving it to Philadelphia for ten years, and to Georgetown permanently afterwards, this might, as an anodyne, calm in some degree the ferment which might be excited by the other measure alone. So two of the Potomac members (White & Lee, but White with a revulsion of stomach almost convulsive) agreed to change their votes, & Hamilton undertook to carry the other point. In doing this the influence he had established over the Eastern members, with the agency of Robert Morris with those of the middle states, effected his side of the engagement, and so the assumption was passed, and 20. millions of stock divided among favored states, and thrown in as pabulum to the stock-jobbing herd. This added to the number of votaries to the treasury and made its Chief the master of every vote in the legislature which might give to the government the direction suited to his political views."
"I know well, and so must be understood, that nothing like a majority in Congress had yielded to this corruption. Far from it. But a division, not very unequal, had already taken place in the honest part of that body, between the parties styled republican and federal. The latter being monarchists in principle, adhered to Hamilton of course, as their leader in that principle, and this mercenary phalanx added to them ensured him always a majority in both houses: so that the whole action of the legislature was now under the direction of the treasury. Still the machine was not compleat. The effect of the funding system, & of the assumption, would be temporary. It would be lost with the loss of the individual members whom it had enriched, and some engine of influence more permanent must be contrived, while these myrmidons were yet in place to carry it thro’ all opposition. This engine was the Bank of the U.S. All that history is known; so I shall say nothing about it. While the government remained at Philadelphia, a selection of members of both houses were constantly kept as Directors, who, on every question interesting to that institution, or to the views of the federal head, voted at the will of that head; and, together with the stockholding members, could always make the federal vote that of the majority. By this combination, legislative expositions were given to the constitution, and all the administrative laws were shaped on the model of England, & so passed. And from this influence we were not relieved until the removal from the precincts of the bank, to Washington."
Thomas Jefferson in "Anas" dated February 4, 1818
"The question will be asked and ought to be looked at, what is to be the resource if loans cannot be obtained? There is but one, “Carthago delenda est.” Bank paper must be suppressed, and the circulating medium must be restored to the nation to whom it belongs. It is the only fund on which they can rely for loans; it is the only resource which can never fail them, and it is an abundant one for every necessary purpose. Treasury bills, bottomed on taxes, bearing or not bearing interest, as may be found necessary, thrown into circulation will take the place of so much gold and silver, which last, when crowded, will find an efflux into other countries, and thus keep the quantum of medium at its salutary level. Let banks continue if they please, but let them discount for cash alone or for treasury notes. They discount for cash alone in every other country on earth except Great Britain, and her too often unfortunate copyist, the United States."
Thomas Jefferson in a letter to John W. Eppes dated September 11, 1813.
Kind of makes me want to Read Thomas Jeffereson to get further insight or basics about US Banks.
"And I sincerely believe, with you, that banking establishments are more dangerous than standing armies; and that the principle of spending money to be paid by posterity, under the name of funding, is but swindling futurity on a large scale."
Thomas Jefferson in a letter to John Taylor dated May 28, 1816.
"If, then, control of the people over the organs of their government be the measure of their republicanism, and I confess I know no other measure, it must be agreed that our governments have much less of republicanism than ought to have been expected; in other words, that the people have less regular control over their agents, than their rights and their interests require."
Thomas Jefferson in a letter to John Taylor dated May 28, 1816.
"In these sentiments, Sir, I agree to this Constitution with all its faults, if they are such; because I think a general Government necessary for us, and there is no form of Government but what may be a blessing to the people if well administered, and believe farther that this is likely to be well administered for a course of years, and can only end in Despotism, as other forms have done before it, when the people shall become so corrupted as to need despotic Government, being incapable of any other."
Benjamin Franklin in his address to the Constitutional Convention dated September 17, 1787
"Those who contend for a simple democracy, or a pure republic, actuated by the sense of the majority, and operating within narrow limits, assume or suppose a case which is altogether fictitious. They found their reasoning on the idea, that the people composing the Society, enjoy not only an equality of political rights; but that they have all precisely the same interests, and the same feelings in every respect. Were this in reality the case, their reasoning would be conclusive. The interest of the majority would be that of the minority also; the decisions could only turn on mere opinion concerning the good of the whole, of which the major voice would be the safest criterion; and within a small sphere, this voice could be most easily collected, and the public affairs most accurately managed."
"We know however that no Society ever did or can consist of so homogeneous a mass of Citizens. In the savage State indeed, an approach is made towards it; but in that State little or no Government is necessary. In all civilized Societies, distinctions are various and unavoidable. A distinction of property results from that very protection which a free Government gives to unequal faculties of acquiring it. There will be rich and poor; creditors and debtors; a landed interest, a monied interest, a mercantile interest, a manufacturing interest. These classes may again be subdivided according to the different productions of different situations & soils, & according to different branches of commerce, and of manufactures. In addition to these natural distinctions, artificial ones will be founded, on accidental differences in political, religious or other opinions, or an attachment to the persons of leading individuals. However erroneous or ridiculous these grounds of dissention and faction, may appear to the enlightened Statesman, or the benevolent philosopher, the bulk of mankind who are neither Statesmen nor Philosophers, will continue to view them in a different light."
"Divide et impera, the reprobated axiom of tyranny, is under certain qualifications, the only policy, by which a republic can be administered on just principles."
A few selected thoughts of James Madison from a letter written to Thomas Jefferson dated October 24, 1787
Messing With Our Minds: The Ever Finer Line Between News and Advertising
Thursday, 24 May 2012 10:58 By Kingsley Dennis, Truthout | News Analysis
The manufacturing of consent is endemic within modern societies. Throughout history, the need to "persuade and influence" has always been manipulated by those people in power as a means to maintain authority and legitimacy. In more recent years, the overall manipulation of the mass public mind has become less about making speeches and more about becoming a pervasive presence within the lives of each of individual.
Edward Bernays has often been called "the father of public relations," as it was his teachings and research that spurred the postwar years of propaganda. Bernays, a nephew of Sigmund Freud, utilized psychological and psychoanalytical ideas to construct an informational system - propaganda - capable of manipulating public opinion. Bernays, apparently, considered that such a manipulative apparatus was necessary because society, in his regard, was composed of too many irrational elements - the people - which could be dangerous to the efficient mechanisms of power (or so-called "democracy"). Bernays wrote that, "The conscious and intelligent manipulation of the organized habits and opinions of the masses is an important element in democratic society."[1] Bearing in mind that Bernays was working in the early 1920s, we can expect the mechanisms of propaganda - mass manipulation - to have progressed to a very advanced degree since then. Within the context of our modern mass societies, propaganda has morphed into a mechanism for not only engineering public opinion, but also for consolidating social control.
Modern programs of social influence could not exist without the mass media. Today it exists as a combination of expertise and knowledge from technology, sociology, social behaviorism, psychology, communications and other scientific techniques. Almost every nation needs a controlled mainstream media if it is to regulate and influence its citizenry. By way of the mainstream media, a controlling authority is able to exert psychological influence upon people's perception of reality. This capacity works hand in hand with the more physical components, such as enforcing the legal system and national security laws (surveillance and monitoring). State control, acting as a "psychological machine," instigates specific psychological manipulations in order to achieve desired goals within its national borders (and often beyond). Examples of these psychological manipulations include the deliberate use of specific cultural symbols and embedded signifiers that catalyze conditioned reflexes in the populace. These triggers have included the words "red" and "communist" during the United States' 1950s McCarthyism, and "Muslim terrorist" during the currently constructed war on terror. Targeted reactions can thus be achieved, making the populace open to further manipulation in this state. This is a process of psychic re-formation that works repeatedly to soften up the people through continued and extensive exposure to particular stimuli. These are the symbols, artificial and human-made, that we live by in order to allow for the construction of a compliant society.
Today's media, which includes the dominant presence of advertising, extensively uses the notion of "attractors" and "attractor patterns" to target audience consciousness. This type of symbol manipulation is often referred to in the business as neuromarketing. Mainstream media corporations are using the huge growth in global communications to further shape their science of targeting human consciousness. In the case of neuromarketing, many advertisers first audience-test their commercials using brain-scanning techniques in order to know which part of a person's brain is being activated by the specific strong attractors. For example, it has been discovered that specific attractors can bypass the logical part of the brain and impact the emotional part. In such cases as the film industry, the advertisers place an award symbol (such as an Oscar or Golden Globe) which has proven to be an effective "strong attractor" which influences the emotional part of the brain. The philosophy here is to adjust the level of consciousness of an advertisement in relation to the measurable level of consciousness of the consumer.[2] Advertisers are aware that a person's consciousness passes on messages indirectly to the body in the form of galvanic skin response, pupil response, electrical nerve response, etcetera, and so every element of the screen promotion must elucidate the correct conscious reception. In order to achieve this correct set of attractor patterns, all elements of the advertising package are deliberately worked on: the music, the visuals, the script, the voice. Interesting, symbolic strong attractors that have the most impact to persuade the audience include visuals such as smiley faces and cute animals (dogs wagging their tails and kittens purring). In terms of voiced attractors, they include words such as "honesty," "integrity," "freedom," "hope and change," "friendship," etcetera. From here, it is clear how politicians use a great deal of these attractor patterns in their speeches and promotional material.[3]
Other methods of blatant propaganda include governing bodies using what can be called the "reality of truth" by releasing seemingly accurate statistics that tell of plausible situations. This is the expert-in-the-white-lab-coat tactic. For such propaganda/information to be effective, it cannot be too far from the truth; in other words, it must have the appearance of reality. Trade, employment and financial figures are an example of this. And which members of the general public have the knowledge and/or resources to check and confirm such figures? Those people who do know are usually those who have a vested interest in maintaining the illusion, such as traders and financiers. And when a nation releases its unemployment figures, do the numbers really include the many who are jobless but not signing on, or are dispossessed or immigrants? As a norm, statistics of a negative connotation are usually drawn from the smallest possible pile. Once a false or doctored claim is disseminated and accepted by the public, it becomes established and hard to deconstruct or invalidate, unless persuasive anti-propaganda is just as effective. Modern societies are set up to accommodate both individualism and the mass collective. Yet the forms that the accepted individualism takes are often a sheath to hide the workings of a mass psyche. It is what might be called the "allowed liberty" that is provided to the modern person in pursuit of material gains, as long as there exists a contribution to the overall plan of the ruling authority. Liberty, then, is an expression of mobility within a pre-described system: it does not denote liberty external to the system. Examples are the rock star clichés that the mainstream media love to promote and publish to adorn their front pages. Notable examples are the raging antics of performers destroying hotel rooms and throwing televisions out of the window - behavior which later got morphed into copycat corporate rock PR. In essence, such hotel-trashing "rebels" are allowed, and even encouraged, because their antics sell records. Rebelliousness in these forms is thus another contribution to a consumerist society, albeit through a different lens.Today, there are many forms in which individualism is allowed to manifest.
The display of diversity in the information coming from the mainstream media gives the illusion of independent reportage and news. Yet the mainstream media of any given nation or nations is owned by only a small handful of corporate entities with high-level state relations. An individual is thus attracted to a particular newspaper, for example, relative to their views, beliefs, lifestyles, etcetera - all of these being "diversified patterned behavior" within the system. The mainstream media caters to these needs by operating a variety of newspapers that support these mythical standpoints, whether they be politically left, right, left/right of centre, liberal, independent, this, that, or any other of the positions available for the "diversity within the unity" of the mass mind. Yet the shift toward propagating banal reality lies at the heart of the ever-increasing centralized control of the media. It is somewhat worrying to learn that most Western media organizations are owned by only a handful of giant corporations: News Corp; Viacom; Time Warner; Disney; Vivendi Universal, and Bertelsmann. For example, The Walt Disney Company is the largest entertainment and media multinational in the world. Disney owns the TV networks ABC, Disney Channel, ESPN, A&E and the History Channel, as well as publishing, merchandising and theatre subsidiaries. Disney also owns Walt Disney Pictures, Touchstone Pictures, Hollywood Pictures, Miramax, Dimension and Buena Vista International, as well as 11 theme parks around the world. News Corp comes in next as the world's second-largest media multinational, with an incredible range of TV and satellite channels, magazine and newspaper holdings, record companies and publishing companies based worldwide, with a strong presence in Asian markets.
Similarly, Time Warner owns more than 50 magazines, a film studio as well as various film distributers, more than 40 music labels (including Warner Bros Records, Atlantic and Elektra) and several TV networks (such as HBO, Cartoon Network,and CNN). Viacom owns TV networks CBS, MTV, VH1, Nickelodeon, Comedy Central, Paramount Pictures and nearly 2,000 cinema screens, as part of their media empire. Likewise, Vivendi Universal owns 27 percent of US music sales via labels such as Interscope, Geffen, A&M, Island, Def Jam, MCA, Mercury, Motown and Universal. They also own Universal Studios, Studio Canal, PolyGram Films, Canal+, and numerous Internet and mobile phone companies. Then there is Bertelsmann, which, as a global media corporation, runs Europe's second-largest TV, radio and production company (the RTL Group) with 45 TV stations and 32 radio channels, Europe's largest printing and publishing firm (Gruner + Jahr), the world's largest English-language general trade book publisher (Random House), the world's largest book and music club group (Direct Group) and an international media and communications service provider (Arvato AG).
In our media-saturated environments, people are allowed to live out their fantasies in what is considered a less harmful way to help alleviate the so-called "drudgery of repetitive lives." This construct also provides people with a conversation space and stalking point among friends and work colleagues, or offers a buffer zone to cover up the embarrassment of a non-communicative family. And if all hell breaks lose at work, at least you have "True Blood" or "Friends" waiting for you on the home screen!
In terms of mainstream news reporting, it is always important to check the source when reading a news item; that is, is it from an independent source or is it, "according to a government source," etcetera. The mainstream media is largely fed via global news services, the two largest being Reuters (now Thomson Reuters) and Associated Press. This again constitutes a centralization of news information. While both organizations do much fine and accurate news reporting - which, valuable as it is, may unfortunately be taken by some as adequate proof that the news is not manipulated - when such sources (especially through PR offices) disseminate information as "truthful news," they are doing nothing more than was parodied in Orwell's "1984" as Newspeak. Independent media, such as is now coming of age and maturity on the Internet, has served to counterneutralize some of the overwhelming persuasive power of the mainstream media propaganda. For this reason, there are concerted efforts underway to curtail the supposedly "wild" and "uncensored" nature of the Internet. In other words, this means that there is considerable corporate and political will to rein in the Internet under the umbrella of corporate and governmental/state control, or at least, to surveil its use.
What has changed the game plan over the past two decades has been the rise of distributed and decentralized global communications between individuals. The Internet in particular, as well as other forms of social media, have spurred the growth of individuals seeking information between and among themselves, a process which is often external to the consensus of various nation-states. This has had the effect of shifting people away from conditioned patterns of propaganda and belief systems. This bottom-up intervention has seriously compromised the patterning techniques of ruling authorities. There are now efforts underway to censor information sites that are critical of the state. It is therefore imperative that our independent media be protected, our social networks of free speech preserved, and our right to seek and speak the truth defended. Messing with our minds has no place in a truly democratic and egalitarian future.
Endnotes
Bernays, E. L. (2004/1928) "Propaganda." New York: Ig Publishing.
This idea, as well as neuromarketing, was given to me in personal correspondence by Darryl Howard, who sent me his research, "Advertising in the New Paradigm" (Darryl Howard & Associates).
Anyone wishing to know more on this subject should investigate Neural-Linguistic Programming (NLP).
This article is a Truthout original.
New York Senate Bill Seeks to End Anonymous Internet Posting
By Tecca | Today in Tech
If the bill passes, get ready to hand over your full name and home address
Anonymity is a double-edged sword. On the one hand, the United States was founded, in part, thanks to Thomas Paine's anonymously written, pro-revolution pamphlet Common Sense. On the other hand, 12-year-olds who post anonymously on the internet can be rather unpleasant and cause real problems by cyberbullying. Whether you think the good outweighs the bad, this news is troubling indeed: A far-reaching bill introduced in the New York State Senate could end the practice of posting online once and for all.
Sen. Thomas F. O'Mara (R—Big Flats), S6779 would require that any anonymous post online is subject to removal if the poster refuses to post — and verify — their legal name, their IP address, and their home address. From the (likely well intentioned) bill:
"A web site administrator upon request shall remove any comments posted on his or her web site by an anonymous poster unless such anonymous poster agrees to attach his or her name to the post and confirms that his or her IP address, legal name, and home address are accurate. All web site administrators shall have a contact number or e-mail address posted for such removal requests, clearly visible in any sections where comments are posted."
Critics are quick to point out how dangerous and ineffective the anti-privacy bill would be in the off chance that it somehow passes. After all, IP addresses do nothing to verify a person's identity, and including your home address on a controversial internet post could open you up to real-life threats.
In effect, the bill is an online stalker's dream. Of course, the most likely result of the bill's passage would just be the full-scale elimination of all comment systems everywhere, because the system is an unworkable burden on both the poster and the "web site administrators" who would need to respond to ludicrous take down requests at all times of the day.
[via Geekosystem]
This article was written by Fox Van Allen and originally appeared on Tecca
Americans love the rhetoric of freedom but detest the responsibility of it. This is an ongoing reality that must always be dealt with. Deny this reality and you will accomplish nothing.
Wow! Thank you for posting this. Our Bill of Rights are under threat and with the passage of NDAA--innocent Americans could end up in military prison (indefinitely) with no charges against them or due process.
Pinch me, am I still living in America? This is a nightmare!!! Anyway, keep the conversation going and let us take the necessary action(s). We are living in a very critical time.
"It is said that Mithridates trained himself to drink poison. Like him we learn to swallow, and not to find bitter, the venom of servitude." -Etienne de la Boetie (The Discourse of Voluntary Servitude)
My next step is to write up a contract for campaign supporters and their candidate or incumbent to sign. The signed contract would obligate the official body of campaign supporters to continue their support of the politician's election campaign in return for the politician's unconditional support of the amendment upon being elected. Violation of the contract by the elected politician would have to constitute an act of fraud rather than merely a breach of contract.
I like the idea but how do you get it done?
Why would any candidate get involved unless a very large group was behind the specific "contract" such as agreeing to overturn Citizens United ?
The idea is for the candidate's primary campaign supporters in solidarity with all the rest to require it for continued support as there can be no campaign without those who officially help to run it. The campaign supporters would have to value the importance of the contract above the candidate. That's what it ultimately all comes down to. Even for other issues, the idea is to start a trend in which campaign supporters hold their candidates accountable with legally binding contracts. What the contract would actually do is create a choice for the American voters. Either the American voters can choose to hold their candidates accountable thereby freeing themselves from subjugation to unaccountable public servants or the American voters can continue in their own subjugation by supporting public servants they refuse to hold accountable. With the contract, it becomes a matter of collective choice for all the world to see.
So this sounds like what grover did - and it worked! If OWS can develop a document backed by large blocks of us, and use it to attract congressmen to our position, we would need to spread this concept beyond NY [where I am], and this forum, and where you are. How? grover had the koch money to primary uncooperative "liberals"
Any ideas on this front?
I've recently had the realization that a much simpler way exists to spread the Free Democracy Amendment and that's simply to spread it at the state level among the ballot initiative states. In those states, voters don't have to rely upon unaccountable representatives to get it passed, they can simply vote for it themselves. It would only take one state, perhaps the state of California, to bring national attention to it, leading to the other ballot initiative states to follow suit. If all 24 ballot initiative states were to pass it, pressure would be upon both their state and federal representatives for supporting national ratification. As a consequence, pressure would then be upon representatives in the rest of the 26 states to pursue ratification. This is not to assume that any of the representatives in any of the 50 states would simply give in to popular pressure but resistence would simply lead to the proposed contract process being resorted to by the voters.
In addition, if the 24 ballot initiative states were to pass it, state banks would be established in all of those states allowing for the formation of a Union Reserve Bank composed of the state banks and poised to replace the Federal Reserve Bank upon national ratification.
As for spreading the concept, I would direct it towards three groups; the Tea Party, the African-American churches, and politically active college students. If people see groups at the opposite ends of the political spectrum like the Tea Party and the African-American churches agreeing on the importance of an issue, it'll be recognized that the issue is of universal appeal and self-identifying progressive groups that look down on them will jump on the band wagon as to not be up staged by the likes of them. Add to that the energy of the educated voting youth to promote it and you have an issue that can easily go viral even on a global scale.
Everything is dependent upon a paradigm shift among the voters to hold issues above candidates. They must refuse to support their candidate if their candidate refuses to sign the contract. There must also be a person among them willing to sign the contract and run for office. This will create the pressure necessary to have the main candidate sign or else be ignored for someone who will. Either way, the voters will have someone who signs. Thus, it all comes down to voters across party lines holding the contract above their desires to see a well liked person in office.
"It is incredible how as soon as a people becomes subject, it promptly falls into such complete forgetfulness of its freedom that it can hardly be roused to the point of regaining it, obeying so easily and so willingly that one is led to say, on beholding such a situation, that this people has not so much lost its liberty as won its enslavement." -Etienne de la Boetie (The Discourse of Voluntary Servitude)
"Liberty is the only joy upon which men do not seem to insist; for surely if they really wanted it they would receive it." -Etienne de la Boetie (The Discourse of Voluntary Servitude)
"A people enslaves itself, cuts its own throat, when, having a choice between being vassals and being free men, it deserts its liberties and takes on the yoke, gives consent to its own misery, or, rather, apparently welcomes it." -Etienne de la Boetie (The Discourse of Voluntary Servitude)
“In all revolutions, those who ardently pursue the fight to the death are in the minority and there are usually at least as many who are ardently anti-revolutionary, plus an actual majority that is apathetic and will go where they are led (in either direction), if necessary, but who best prefer to be left alone.” -Isaac Asimov
"Experience has taught us, that men will not adopt and carry into execution measures the best calculated for their own good, without the intervention of a coercive power." -George Washington
"All exploitation is based on co-operation, willing or forced, of the exploited. However much we may detest admitting it, the fact remains that there would be no exploitation if people refused to obey the exploiter. But self comes in and we hug the chains that bind us." -Mahatma Gandhi
The constitution of the Commonwealth of Pennsylvania states:
"Elections shall be free and equal; and no power, civil or military, shall at any time interfere to prevent the free exercise of the right of suffrage."
And yet the more than 50,000 people in Pennsylvania prisons have no voting rights. And many on parole or probation have no voting rights.
The Republicans in Pennsylvania have just completed SECRET meetings where they created the new apportionment map of legislative districts for the next ten years. They brag that the map PROTECTS INCUMBENCY. The legislation is being readied for a vote.
There is only one way to protect voting rights and that is to run for office, get elected and write the laws needed to protect the right of universal suffrage. NOTHING else will work.
Anything written into law under one state administration can be repealed by the next. To make universal suffrage binding on a state, a national law in support of it could be passed or a case for it could be argued at the level of the Supreme Court. Then, it would be binding on all states. One simply has to argue that a citizen's right to vote has no logical connection to the condition of incarceration and therefore cannot be prohibited as a punishment for such.
Then you need to rewrite the Jim Crow exception from the fourteenth amendment too.
My original point is that contemptuous of constitutional foundation governments, both liberal and conservative, will do whatever the fuck they want to do in terms of undermining democracy.
What exactly is the Jim Crow exception of the 14th amendment?
The first paragraph of the 14th states:
"All persons born or naturalized in the United States, and subject to the jurisdiction thereof, are citizens of the United States and of the state wherein they reside. No state shall make or enforce any law which shall abridge the privileges or immunities of citizens of the United States; nor shall any state deprive any person of life, liberty, or property, without due process of law; nor deny to any person within its jurisdiction the equal protection of the laws."
this is the Jim Crow exception:
"No state shall make or enforce any law which shall abridge the privileges or immunities of citizens of the United States; nor shall any state deprive any person of life, liberty, or property, without due process of law..."
Jim Crow stands on two legs. 1. Direct denial of access to ballots and voting processes. The Voting Rights Act of 1965 significantly impaired this leg.
The other leg of Jim Crow was more insidious, incarceration and criminal electoral disenfranchisement based on trumped up criminal charges. The Jim Crow exception of the 14th Amendment.
The Jim Crow exception floundered as a local weapon against minorities and the poor between 1965 when the Voting Rights Act was passed and 1971 when Richard Nixon, in collusion with the Dixie-crats in Congress, created the War on Drugs as a means of nationalizing law enforcement against minorities and other poverty oppressed Americans who rose to the bait of tax free income from drug sales.
Countless millions of Americans have been disenfranchised and more disaffected by the Jim Crow Drug War in the past forty years using the Jim Crow exception in the 14th Amendment.
Okay, thanks. This will help me to modify the Free Democracy Amendment.
The same clause in the 14th, that I posted, also has been rightly attributed with getting the states to adopt the higher standard of civil rights implicit in the Bill of Rights. So changing the clause is not the issue.
The issue is to specifically protect suffrage on a universal basis. I would have two exceptions that would incur a lifelong ban from voting in America. 1. Conviction for treason. 2. Conviction for voting fraud.
Otherwise I am quite proud of Pennsylvania's Constitution suffrage clause.
"Elections shall be free and equal; and no power, civil or military, shall at any time interfere to prevent the free exercise of the right of suffrage."
And this helps as well.
"From the conclusion of this war we shall be going downhill. It will not then be necessary to resort every moment to the people for support. They will be forgotten, therefore, and their rights disregarded. They will forget themselves, but in the sole faculty of making money, and will never think of uniting to effect a due respect for their rights. The shackles, therefore, which shall not be knocked off at the conclusion of this war, will remain on us long, will be made heavier and heavier, till our rights shall revive or expire in a convulsion." -Thomas Jefferson (Notes on the State of Virginia)
So Congress writes this Amendment and the states ratify it?
Yes, but the people have to demand it by being unified in not voting for any candidate or public official who refuses to publicly sign a pledge in support of the amendment. Without the overwhelming support and unity of voters to do this across party lines, it will go nowhere.
"The Consumer's Got to Change the System": Farmer Ben Burkett on Racism and Corporate Control of Agriculture
Sunday, 17 March 2013 10:47 By Tory Field and Beverly Bell, Other Worlds | Report
http://truth-out.org/news/item/15158-the-consumers-got-to-change-the-system-farmer-ben-burkett-on-racism-and-corporate-control-of-agriculture
Ben Burkett is a family farmer and coordinator of the Federation of Southern Cooperatives for the state of Mississippi. He is also president of the board of the National Family Farm Coalition and a member of the food sovereignty commission of Via Campesina, the international network of small farmers and landless people. He gave the following interview one early morning in New Orleans, where he went to deliver a truckload of his cooperatives’ okra to Whole Foods: The Federation of Southern Cooperatives grew out of the civil rights movement. We are probably 90 percent African American, but we have white, Native American, and Hispanic farmers. Racism is still here in the marketplace and in credit, but we have learned to deal with it and not give up on changing the system. We struggle every day to bring about a change.
We work with co-ops in 16 Southern states. Everything we’re about is food sovereignty, though I don’t think that many farmers in Mississippi really know the term. It’s the right of every individual on earth to wholesome food, clean water, clean air, clean land, and the self-determination of a local community to their rights of intellectual property to grow and to do what they want.
We just recognize the natural flow of life; it’s just what we’ve always done. Like myself, I’m a fourth-generation farmer on a farm that my great-grandfather homesteaded in 1889. That wasn’t but about 20 years after the end of slavery. He got 164 acres from the United States government. I still have the title – they called it a patent – signed by Grover Cleveland. And we’re still farming that same land. Our view is local production for local consumption. The crops we grow, we sell them mostly within a 300-mile radius of this [Indian Springs Farmers Association-owned] packing facility.
We don’t want a change. We just want to go back to the way things were. It’s just supporting mankind as small farmers and family farmers. It’s not so much a matter of making money, it’s a matter of carrying on so your farm will continue on. But you have to make some profit off it in order to keep it going.
Some say the system is working. It appears to be working fine, but corporate agriculture is not sustainable. Our system of growing food is heavy, heavy, heavy dependent on petro-chemicals, on inorganic compounds, mostly petroleum-based. And then it takes too much control out of the local community. Now, it might last for several decades, but in the end it can’t last.
You’ve got a few companies that want to control all the seedstock of the world, and they’ve just about got a handle on marketing three of the main commodities: corn, soybean, and cotton. It’s hard to find seeds that aren’t treated with the Monsanto-manufactured Roundup Ready. I’ve tried to find cotton that wasn’t treated, but I couldn’t. Now they’re working on controlling wheat and rice.
And they make those seeds so most of them don’t regenerate the next year anyway. But if you do save any of the seeds, Monsanto and the other companies are going to prosecute you for saving their property. Those seeds are patented, the property of the seed company, so they reserve the right to keep them. They’ll take you to court and make you pay back their money. Basically you’re just sharecropping for them, you’re leasing their seeds.
I don’t think that’s fair. Once you’ve bought the seeds and planted them on your own land, it looks to me like they ought to be your own seeds. That’s the essence of life. Where did Monsanto and the other companies get their first seed from? Someone gave them to them. Those seeds didn’t fall out of the sky.
Through the National Family Farm Coalition, we signed onto the protest against the seeds Monsanto sent to Haiti. Developing countries such as Haiti have no need for Monsanto, for hybrid seeds or GMO seeds, no kind of way. Let them use their traditional seeds they’ve been saving for hundreds of years. Let them propagate and then continue to farm traditionally. Because if they get used to buying from America, they’ll lose the diversity of seed that they need in order to build new seed. Normally when those types of seeds and other products from America hit a country, local farmers lose. They get put out of business, they can’t compete.
We’ve been – I don’t want to use the word co-opted – trained by the institutions of agriculture, the companies, the university system, and technology, to give our rights over to the company, which I think is absolutely wrong. We have to be more proactive than reactive as small farmers, family farmers. We can’t wait for the government and large corporations to dictate to us what we can do in our region. They got a unique way of buying you off to not fight here. The American consumer doesn’t care as long as it’s cheap. But no matter what us farmers plant, the consumer’s got to change the system. People buying the end product have to complain. As long as they don’t complain, there’s no need even talking about it. The marketplace dictates.
This piece was reprinted by Truthout with permission or license. It may not be reproduced in any form without permission or license from the source.
Making a New Economy: Getting Cooperative
Saturday, 16 March 2013 00:00 By David Morgan, Truthout | Op-Ed
http://truth-out.org/opinion/item/15001-making-a-new-economy-getting-cooperative
A new economy is coming. While Wall Street banks are on a trend of corporate mergers and acquisitions, Main Street businesses are generating community wealth while undergoing a transition of their own. Traditional companies are becoming worker cooperatives, both to sustain during tough economic times and because years of success have enabled these companies to reward their workers. State and local governments are beginning to get wise to this trend, too, adding legislative influence to an already vibrant movement.
Take the example of Zingerman's Community of Businesses, an umbrella company that runs a fleet of food service outfits based in Ann Arbor, Michigan. Over the course of more than 30 years, Zingerman's has become a statewide destination for food lovers, and their owners have become business community luminaries. Nearly 600 employees work in the eight distinct businesses that comprise the Zingerman's Community, generating annual revenues of $46 million. Inc. Magazine once rated Zingerman's among the coolest companies in the States, and the very same leaders whose vision has been so celebrated are now designing a plan to transition Zingerman's to an employee-owned worker cooperative. When the transition is complete, Zingerman's will be among the largest worker co-ops in the United States.
"It's exciting to see so many of these transitions happening today, and when a relatively large and remarkably successful company like Zingerman's moves in this direction, it says something powerful about the possibilities of the Next Economy," says John Abrams of South Mountain Company. Abrams is advising Zingerman's on its transition, and brings more than 25 years of experience to the Zingerman's table. In 1987, Abrams was among those who transitioned his workplace, a design/build firm in Massachusetts named South Mountain Company, to a worker-owned cooperative. "Ownership is a very big deal," he explains, "and when the people who are making the decisions share in both the rewards and the consequences of those decisions, it's natural that better decisions result."
Putting decision-making power in the employees' hands can keep a local economy going in tough times, and create stable jobs that are far less likely to disappear in times of crisis. The high-profile example of Chicago's Republic Windows & Doors is one such case of a transition born out of conflict and economic strife. In late 2008, Bank of America cancelled the company's line of credit, driving it into bankruptcy, and the workers were set to be laid off without their due severance pay or other benefits. Days later, the embattled workers occupied the factory and took control of what the bank had threatened to take away. Assisted by many players in the cooperative movement, those same workers who occupied Republic Windows & Doors have since decided to take permanent control of the company and turn it into a cooperative called New Era Windows.
These recent conversions draw from deep roots. Businesses transitioning today enjoy a broad support network of co-ops drawing from decades of experience. Pioneering company conversions include the 25-year-old Collective Copies of western Massachusetts, whose unionized, striking employees pooled their skills and experience to change over the failing and exploitative Gnomon Copies, revitalizing, strengthening, and updating it to a modern, collectively-run print shop.
These historical examples and the current economic climate are convincing municipalities across the country that transitioning to a co-op-focused economy is a good idea. Recently, two dozen city officials met in Reading, Pennsylvania, to discuss boosting the local economy by creating co-ops, and the mayor of Richmond, California, created a co-op development position to advise the city government.
The picture isn't as rosy elsewhere in the country, however. "You can't even form a cooperative in every state in the US," says Melissa Hoover, president of the US Federation of Worker Cooperatives, because "the legal form simply does not exist in some states." Indeed, even among cooperative enterprises, only one percent are worker-owned.
As one of the five states that offer worker cooperatives an official business identity, Massachusetts leads the way in supporting worker cooperatives. Legislation is currently on the table that would formalize and clarify the transition process for companies looking to become worker-owned. The new laws would require business owners to notify their workers when they intend to sell the company, making it clear to employees that they are eligible to purchase or bid on the company. It would also give the employees the right of first refusal.
Where co-ops don't already have a foothold, advocacy groups are making strides, including the formative New Orleans Cooperative Development Project, which describes itself as "a community consortium to facilitate the startup and development of worker-owned cooperative businesses in the region." In the midwest, the Cincinnati Union Co-op Initiative, pairs United Steelworkers - the largest US-based union - with the Mondragon Cooperative Complex, the largest co-op worker system in the world.
"To survive the boom and bust, bubble-driven economic cycles fueled by Wall Street, we must look for new ways to create and sustain good jobs on Main Street," Leo Gerard, president of United Steelworkers, told The Nation last year. "Worker-ownership can provide the opportunity to figure out collective alternatives to layoffs, bankruptcies and closings."
The cooperative movement enjoys growing acceptance in the business community, aided by visionary political leadership that recognizes the value of community resilience. A crucial part of the co-op movement is how it integrates with our communities; each new co-op makes the economy more accountable to the people who live on Main Street, and has the power to change how we will build a new economy.
Copyright, Truthout.
Independent Publisher Chelsea Green Flourishing as Employee-Owned Company
Sunday, 25 November 2012 08:53 By Martha Sorren, Truthout | Report
http://truth-out.org/news/item/12816-independent-publisher-chelsea-green-flourishing-as-employee-owned-company
When Margo Baldwin started the independent publishing company Chelsea Green in 1984, she had plans to eventually sell her ownership. But 28 years later, rather than sell to a venture capitalist and risk the potential for the company to lose its independent integrity or to be moved from its home in Vermont, Baldwin moved the company ownership from the employer to the employed.
On July 2, in a step that more and more companies have been taking, Chelsea Green joined the ranks of companies turning ownership over to their employees in a new business model.
"I think the reason you don't see more companies moving this direction is because they take the traditional model for granted or they want more money," said Baldwin. "For us, it came down to how do we keep our company independent and in Vermont? We already had some of that shared ownership culture so it wasn't a big stretch. Becoming employee-owned goes along with a democratic workplace."
The democratic workplace of Chelsea Green is comprised of 21 employees, just one worker more than the recommended 20 employees to start an ESOP (employee stock ownership plan), and Baldwin said her former employees have been "very pleased" about the change.
"I'm pretty proud of our founders for transitioning to this new business model" said Joni Praded, senior editor. We're a pretty driven staff, so we've always been focused on doing well and giving it our all. Having a stake in the outcome, though, makes it even more worthwhile."
Their investment in the company comes at no cost to the employees, Baldwin emphasized.
"The employees don't contribute a dime," she said, adding the switch in ownership is designed for the betterment of the company and its employees, without creating financial strain on them. Baldwin considered not only her employees' finances, but also the feelings of her original investors, those closest to her.
"There were people, family and friends, who said that they wanted to get their money out, but we didn't have any way to do that yet," said Baldwin. Fortunately they were able to find a way to finally free up that money. "Doing the ESOP solved a lot of problems all at one time, and it was affordable.”
An ESOP is an employee benefit plan that makes the employees of a company owners of stock in that company. And oftentimes, according to the ESOP Association, an ESOP is used as a technique to finance a corporation because, unlike most other employee benefit plans, an ESOP allows participants to borrow money.
"From the employee's point of view, what's not to like? she asked. "They're being given something that is in addition to their regular compensation and which doesn't really require them to do much but share in the outcome."
With the transfer of ownership complete, Baldwin is now focusing on integrating the new policy into the workplace.
Fortunately, she noted, the outcome of Chelsea Green's new challenge is likely to be a good one because the company is flourishing at a time when many publishers are not. It's leading the industry in books on sustainable living, an area it prides itself on diving into before many other publishers. The editorial strategy is to keep ahead of the curve, and Baldwin predicted what she thinks is on the horizon now that the rest of the world seems to have caught up on topics of organic food and sustainability.
It's clear the titles Chelsea Green is putting on shelves are reflecting this cutting-edge strategy as the company joins the 11,000 other employee-owned companies representing about 12 percent of the workforce in America in 2010.
"Permaculture is beginning to make an impact, as is agroecology," she said. Permaculture refers to agricultural systems modeled from natural ecosystems, while agroecology brings to bear ecological principles in agricultural production. And, as a good salesperson, Baldwin added: "We have some books coming out on building a locally based economy and self reliance."
"We're a mission-driven company, so those of us who work at Chelsea Green do so because we believe in the books we produce," said Praded. "We're working for change on many fronts, and we do that by publishing books that stimulate new ideas and spread solutions to the slew of social, political, financial, agricultural, and ecological crises that we all face today. Employee ownership allows that mission to carry into the future - which is perhaps the most personally rewarding aspect of the ownership change."
Gar Alperovitz, one of Chelsea Green’s foremost authors, has written extensively on how employee ownership will revolutionize the country and world. "Chelsea Green walks the walk as well as talks the talk. It's a place of integrity and commitment," he said. One of my best publishing experiences got better this year with the move to employee ownership!"
It's now been over four months since the switch officially happened, and Baldwin is pleased.
"Overall, the morale is very good, sales are up for the company 30 percent, and we've just had our fourth New York Times bestseller, The Art of Fermentation, by Sandor Katz," said Baldwin. "Our authors, too, seem pleased to be working with a company that is so mission-oriented, and I think we'll see more authors coming our way because we're employee-owned." She added an observation: "I think the shift to employee ownership has resulted in staff taking on more responsibility and commitment to the future, and people seem excited to be working here."
At the start of the change, Baldwin had expressed concern at the process of building the new ownership into their workplace. "I think the hard part is going to be getting everyone involved in creating an employee-owned company, but the upside is now people get to see the results of their efforts more clearly through the sharing of financial information and an understanding of cost structures and other things on the business aspects of running a publishing company."
But months later, the company has managed to implement the new ownership with little disturbance, and it is still flourishing.
"There hasn't been a change in management or organization," Praded said. "But, we've hired a few new positions as we continue to grow."
Said Shay Totten, communications director, "The ESOP was about vesting employees in the ownership of the company, but we still have our same jobs/roles, and the work has been as rewarding as ever. With the move to employee ownership, I think we all feel more vested in the company's own future and sustainability, and that will only grow over time as we each take our leadership role as employee owners to ensure that our mission remains vibrant and our bottom line healthy."
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Can you reduce this down to one: specific, clearly defined amendment.
Any of the amendments can be singled out to receive full attention. Each amendment can be championed individually or collectively as presented.
The importance is in the use of affidavits as the condition upon which voters will vote for candidates. There are several "get money out of politics" ideas for amendments but simply voting for unaccountable corporate bought politicians and hoping for a change is ineffective. With the affidavit idea applied to any desired amendment, hope becomes assurance with the election of more and more candidates who have signed affidavits that the voters have agreed upon. If an elected politician should decline to uphold their commitment to an affidavit and the justice system should decline to uphold the law for the penalty of perjury, there will already be majority support for mass protest.
With the use of affidavits, several amendments can be passed at a time instead of hoping for a single one to be passed someday. The affidavits establish the legal commitment of the candidates to what the voters want so it's a simple matter of getting such candidates elected. Once the use of affidavits catches on with voter solidarity behind them, only those candidates who make themselves accountable to the voters by signing the affidavits should get elected. Since devoted Democrats and Republicans will vote along party lines without commitment to affidavits, it would be the current non-voter population that would be expected to find the use of conditional voting as the means of finally making voting count and thereby finally making positive change.
To have a politician sign an affidavit during his time of campaign, ..would be asking too much.IMHO. He /She has to have the right and freedom to have a change of heart or mind on any or all decisions.. , and the reason he should be a winner of election is because of his abiltiy to make the right decisions being.. well thought, and well balanced.
I respect your thoughts.
Once voter solidarity on the conditions for receiving votes is established, the only candidates to sign will be those who are already in agreement with the affidavit before they have even announced their bid to run. The affidavit serves as a legal contract between the candidate and the voters, obliging the candidate's support of the affidavit stipulations upon election. If a candidate feels they should be free to have a change of mind after being elected upon the promise of carrying out the voters' will, they shouldn't sign an affidavit legally committing them to doing so. In fact, to change one's mind only after subjecting oneself to a legal commitment and getting elected would be a sign of not being well thought and balanced.
The ability to change ones mind, can be considered a sign of growth.
What happens when debates come up after the campaign that were not discussed during the campaign.. We need to have someone in there who can " do the right thing" In Reality , this is what congress is mostly about, debating issues .. and getting to the bottom of everydetail. carefully and painstakingly.. Congress is no picnic in the park. I understand your concern . Once you have congress sign an affidavit to do as you tell them .. you will than need the voters to vote as you tell them .. could be trouble there !?
It's the other way around. The voters first agree upon what they're voting for and create the affidavit that expresses it. Candidates then either accept legal accountability to the voters by signing the affidavit or decline legal accountability to the voters by not signing the affidavit. The candidates already understand that the freedom to change one's mind without the penalty of perjury ends upon signing the affidavit and getting elected to office.
If one decides to get married, consummate the marriage, and spend time being married, one cannot decide to have a change of mind and get an annulment in order to avoid a divorce no matter what the reason. One must accept the penalties of fulfilling specified conditions upon deciding to end the legal relationship.
An added thought:
Your comparison with marriage and congress, is a good example of the importance of dating/campaign trail. This is the period where we are supposed to explore our options and get to know people before making the " right choice" as in marriage many people have made the wrong choice.. perhaps during the dating they were afraid to ask the " tough questions.. afraid to " rock the boat.. or even worse, they were unable to follow their own intution .. and to end up in a bad situation.. Twenty questions must be asked .. the selection must be carefully made.. after all this is a very important decision .. making the right choice can make all the difference.. do it carefully.
Also, during Mr Obamas first campaign he had promised health care reform. I personally feel he gave his best effort to fullfill his promise.
Well, thanks again. FOB
What you are asking for is very similiar to direct democracy, where the public decide directly by vote. I believe the Constituion was designed to protect Congress and final decisions from Direct Democracy. As we all love the sound of freedom and democracy , do we really believe in " mob decision, or would an intelligent person prefer careful deliberation and careful , prudent decision making ? How does this tie in with politicians making false promises on the election trail ..? and sworn affidavits, ? Well, we have to elect /vote for the candidate based on good judgement. To know in our hearts we chose the person we want representing us.. and in the end it comes down to just that...
I would have to respectfully disagree with the sworn affidavit , as it just "has a bad feel, and leaves a bitter taste.It just wouldn't right . We want to send our elected Candidate off with a smile, support and respect. We have to trust our Representatives. It's our strongest option.
It's been a pleasure.
Trusting our representatives has only resulted in repeated betrayals. The use of affidavits allows for the separation of sincere candidates who openly sign affidavits in their commitment to the voters from the candidates who refuse to sign to remain open to being bought by corporate interests before being elected and bribed by corporate interests upon being elected.
As you point out, direct democracy was something the rulers (as Jefferson had referred to them) wanted to be protected from. Not allowing the recall of representatives, not allowing the election of senators, and the imposition of the electoral college were just a few ways the Founders kept control over the people. Yet, from the very beginning, the decisions of elected officials had been no less based on self interest than those of the people who had elected them http://occupywallst.org/forum/free-democracy-amendment/#comment-749610 http://occupywallst.org/forum/free-democracy-amendment/#comment-748866 . In the end, every democratic decision comes down to either a 'Yea' or a 'Nay' and it doesn't matter if 500 are making this decision or 5 million. It still comes down to either one or the other. The people elected to office have not been shown to be any more prudent in their decision making than the rest of the population. They have no special schooling, no special training, no special qualities that would set them apart from the rest of the population in decision making. They are simply members of the general population who have been elected to office and in doing so, exposed to the special interests vying for their loyalty and betrayal of those who voted for them. At least with a direct democracy, http://occupywallst.org/forum/amendment-for-a-democratic-congress/ there's no one to bribe or buy off.
LeoYo, you point out something I had not considered. In having an affidavit , this would give strength to the good candidates , for they would no longer have to debate with "bought off" candidates.. or cast their vote against them .. This could work out in great favor of actually acomplishing the will of the people.
It's horrible that we have come so low that we must consider such avenues.
If the people ever do gain back the power of the Elected Government.. the clouds will open up and the Sun will truly shine !
The use of affidavits not only gives strength to good candidates, it actually brings them out, encouraging good people to stand up and run for office rather than concluding that running against the status quo would be hopeless.
LeoYo, ..another thought occured, I believe they do swear an Oath' though am not sure what all that entails.
Have a nice day, and once again, " I pleasantly enjoyed our discussion."
The situation with the oath is that it's general and can't hold anyone to being accountable for the specific interests of the voters that will arise from time to time. Although the affidavits could be used by any voting group for any interests they may have, the effective use of the affidavits would be for guaranteeing support for amendments that voters across party lines agree upon. Something that people can come together on as Americans, above their party affiliations.
Nope. Not enough Democrat control.
Democrat control is not an issue. The only issue is the willingness of the people to support FreeDA regardless of political affiliation.
How are you going to fund the government? Voluntary taxes?
There is a gap between public service and public policy.
http://www.youtube.com/watch?v=dJyjNiL4zZg&list=PL981A9FC1B70277C4&feature=view_all
Is this the new government style the GOP will bring to the nation?
The same way government had always been funded prior to 1913...indirect taxes.
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