Four Season Produce transporter, Jeff Martin looks on as broccoli is inspected by a Glut worker-owner of this cooperative store, that serves the Mount Rainier, Maryland community, on Tuesday, March 3, 2015. (Photo: US Department of Agriculture / Flickr)
On November 19, 2016, Geoff Gilbert writes on Truthout:
Yes, the Democrats, as Robert Reich recently wrote, need to transform from a corporate-powered party to a people-powered party. But what do people-powered institutions, which a people-powered party must fight for, actually look like?
The Democrats, for decades, have supported the social institutions of neoliberalism. They have upheld an economy owned by giant, highly centralized corporations, largely free from antitrust enforcement. And they have supported a government of technocratic managers who see their only legitimate roles as handing the public sector over to the private, corporate sector and tinkering with the rules of the corporate markets to try to create fairness around the edges of the corporate economy. All the while, the corporate economy drives further and further concentration of economic and political wealth and power.
Transforming the Democrats toward people power means abandoning these institutions of neoliberalism — a government that aids and abets corporate economic and political power — in favor of people-powered institutions.
People power means democracy. And democracy must be embedded within all of our society’s institutions, rather than only taking the form of a supposedly representative government that tries to regulate our society’s other non-democratic institutions. We need a new vision for democracy that extends to the economy and provides rights for all of us to participate in making the decisions that drive the institutions that shape our society.
Above all, people power must serve the main goal of creating a world that values the full humanity of people of all races, genders, sexualities, religions and nationalities. And if we are serious about creating a world that values everybody’s full humanity, we must provide material and cultural reparations to those harmed most by the current system — Indigenous people, Black people, women, LGBTQ people — so that everyone can fully participate as equals in a reimagined democratic society.
Pushing for People Power in the Next Infrastructure Bill
Though Democrats lost the presidency and both chambers of Congress, they can start a transformation toward people power right now by designing and organizing around a national infrastructure bill that puts these ideals into practice. They can also organize campaigns in big cities, where Democrats hold power, to reorganize public spending priorities to support people-powered institutions.
President Donald Trump will need to pass an infrastructure bill, despite potentially significant opposition from anti-public-spending Republicans, in order to create a meaningful amount of new jobs. The Democrats should not simply support Trump’s preferred version of the bill, whatever that ends up being. Instead, they should argue for a huge injection of public spending — on a scale larger than even Bernie Sanders’ proposed — $1 trillion over 10 years, and possibly using creative monetary policy, like quantitative easing for the people. The public contracts should go to people-powered institutions — preferably worker cooperatives, community land trusts and community-owned renewable energy cooperatives — rather than to the standard small number of wealthy corporations that typically win public contractsand benefit from government development policies.
Through this kind of infrastructure bill, the Democrats can develop a program to transition to a people-powered renewable energy economy, make our basic infrastructure more ecologically sustainable, begin to create ecologically sustainable transportation infrastructure, such as like electrified high-speed rail, and begin to create affordable and community-controlled housing — all while beginning to transform our economy from one owned by the wealthy elite to one that is owned by as many of us as possible. In short, the Democrats can work toward the goal of aligning themselves with the people, rather than continuing to largely cater to the wealthy and their corporations.
Models for People-Powered Institutions Already Exist
When skeptics try to portray progressive efforts to push for a people-powered infrastructure bill as unrealistic, we must insist on the practicality and feasibility of this transformation. People-powered institutions have already begun to take many different specific forms, thanks to the work of groups like the New Economy Coalition around the country.
People-powered institutions include cooperative businesses, which can replace the current corporations that are owned and controlled by a small number of financial investors. People-powered institutions also include cooperatively owned banks, such as credit unions and community land trusts. People-powered institutions can also include different forms of city ownership. For example, cities can own utilities and thus make decisions about producing renewable energy (like Boulder, Colorado, is trying to do) and provide high-speed, low-cost Internet (like Chattanooga, Tennessee has done). Cities can also own the land under and near transit projects, so that taxpayers can retain the value produced by creating public transit, rather than allowing it to be privatized as corporate property for no economic reason.
People power also means allowing communities and cities to directly decide how to spend all of this public money through participatory budgeting. And where action is needed at the national level, people power can take the form of public ownership of industries where markets fail, like health insurance and education.
And people-power must include rules for fair elections. We need automatic voter registration for everyone, a national Election Day holiday, more voting precincts and anything else needed to remove all practical barriers to voting. And the key to fair elections is public financing of elections, preferably through something like the public voucher system Seattle recently created.
People Power as the Answer to Antiestablishmentism
Over the long run, people power is the only way to truly defeat the kind of authoritarianism that Donald Trump represents. Today, most Americans are disenfranchised politically and economically. This has widely discredited all of our institutions, which so many of us haven’t trusted for a while.
For many, the establishment means all of the dominant institutions of our society — including government, business, media and educational institutions. All of our institutions are all highly centralized and authoritarian in structure. They impact millions of people, while rights to institutional decision-making are reserved for a small number of people. And the opportunity to become one of the privileged decision-makers is heavily biased by race, wealth and social connections.
Trump has rallied support by promising that he personally will smash and reshape the establishment. His authoritarianism will fail all people marginalized by the current system, though he — and Republicans — might be able to retain power for a time by stoking racism, homophobia, Islamophobia and nationalism. Democrats might be able to win elections while remaining committed to neoliberalism, if they can find another charismatic presidential candidate. But authoritarianism will always remain a threat, so long as our society’s core institutions remain distrusted and delegitimized.
Both Democrats and Republicans have systematically avoided for decades confronting head-on the social crises created by the ever-concentrating control of political and economic power.
Instead, politicians of both parties have tried to create coalitions around nationalism, Islamophobia, the so-called culture wars, coded anti-Black and anti-immigrant racism, and the myth of the entrepreneur, which produces a divisive politics that basically nobody feels positive about. Politicians from both parties lionize the entrepreneur, casting poverty and general lack of material success as an individual shortcoming, a narrative that erases the structural privilege corporate elites have erected for themselves, along with the wealth impact of the enslavement of Black people for centuries, and genocidal land theft from Indigenous people. The rhetoric also erases the structurally racist policies that have continued to maintain, in the decades since the World Wars, the giant wealth gap enjoyed by white people compared to people of any other race.
This rhetorical emphasis on the individual, rather than on the structures within which we, as individuals, exist, stokes all forms of xenophobia. It encourages everyone to personalize their own material situations — and to look for other individuals, not systems, that have gotten in their way. Over past decades, it has justified the bipartisan policies that materially oppress the most marginalized people in our society — endless wars on drugs and terror, mass incarceration and mass deportation, which is administered by a dystopian government agency called Immigration and Customs Enforcement (ICE) that both Democrats and Republicans have legitimized.
Given the lack of control that most of us have over the big structural forces in our lives — and the xenophobic rhetoric both parties have used, though to different degrees, to distract us from this for decades — we shouldn’t be surprised that Trump, who promises to change things, has such significant support. Even when Trump does not remake our institutions — and if we can somehow avoid the mass xenophobic violence authoritarians often employ to distract people from their failures — authoritarian populism will not disappear with Trump. It will remain a powerful political force, capable of being remobilized by the right charismatic leader, so long as our core social institutions continue to disenfranchise us politically and economically.
Of course, the Democratic Party will never be the answer to all of society’s injustices. Progressives of all stripes must begin dreaming of and organizing around real solutions right now. We need to decentralize political and economic power. We need a society that is actually of the people, for the people and by the people. We need people-powered institutions.
As with so many writers and commentators, they fail to see corporations as assemblages of people with a common purpose to produce products and services and earn a profit, but instead see corporations as abstracts, devoid of people who own them. Agreement should be widespread that with respect to awarding public infrastructure-building contracts, instead of awarding typically narrowly-owned corporations, “people-powered” (corporations owned by their workers and citizens broadly) enterprises should be awarded the contracts so as to benefit from government development policies. This would serve as a beginning to transform our economy from one owned by at the wealthy elite minority to one that is owned by as many of us as possible. Of course, building new and renovating infrastructure is just a relatively small part of the opportunities ahead in transforming our economy from one owned by the wealthy elite minority to one in which EVERY citizen is an owner.
What we really need is monetary and tax reform, by which an annual Capital Homestead Account in the form of insured, interest-free capital credit is extended equally to EVERY citizen, without any requirement for past savings, a job, or education. The capital credit loans would strictly be used to invest in new wealth-creating, income-producing capital assets formed by qualified, successful corporations growing the economy. The capital credit loans would be repayable out of the future earnings of the investments, and once paid would continue to produce income for the new productive owners, who would use the income to satisfy their needs and wants, thus resulting in spiraling green economic growth.
The problem is that technological invention and innovation––change––makes the non-human means of producing––tools, machines, structures, and computerized processes––ever more productive while leaving human productiveness largely unchanged (our human abilities are limited by physical strength and brain power––and relatively constant). This means that fewer and fewer people are necessary to produce the products and services needed and wanted by society. But when a job is one’s ONLY way to be productive and earn an income and jobs are disappearing and the worth of labor is being devalued, we have a problem. The problem is magnified by the fact that upward of 95 percent of the products and services are produced by physical productive capital––the non-human factor––which is owned by less than 10 percent of the population and highly concentrated among less than 1 percent of the population. The result is that primary distribution through the free market economy, whose distributive principle is “to each according to his production,” delivers progressively more market-sourced income to capital owners and progressively less to workers who make their contribution through labor.
Unfortunately, ever since the 1946 passage of the Full Employment Act, economists and politicians formulating national economic policy have beguiled us into believing that economic power is democratically distributed if we have full employment––thus the political focus on job creation and redistribution of wealth rather than on equal opportunity to produce, full production and broader capital ownership accumulation. This is manifested in the myth that labor work is the ONLY way to participate in production and earn income. Long ago that was once true because labor provided 95 percent of the input into the production of products and services. But today that is not true. Physical capital provides not less than 90 to 95 percent of the input. Full employment as the means to distribute income is not achievable. When the “tools” of capital owners replace labor workers (non-capital owners) as the principal suppliers of products and services, labor employment alone becomes inadequate. Thus, we are left with government policies that redistribute income in one form or another, such as a proposed universal basic income.
The capitalism practiced today is what, for a long time, I have termed “Hoggism,” propelled by greed and the sheer love of power over others. “Hoggism” institutionalizes greed (creating concentrated capital ownership, monopolies, and special privileges). “Hoggism” is about the ability of greedy rich people to manipulate the lives of people who struggle with declining labor worker earnings and job opportunities, and then accumulate the bulk of the money through monopolized productive capital ownership. Our scientists, engineers, and executive managers who are not owners themselves, except for those in the highest employed positions, are encouraged to work to destroy employment by making the capital “worker” owner more productive. How much employment can be destroyed by substituting machines for people is a measure of their success––always focused on producing at the lowest cost. Only the people who already own productive capital are the beneficiaries of their work, as they systematically concentrate more and more capital ownership in their stationary 1 percent ranks. Yet the 1 percent are not the people who do the overwhelming consuming. The result is the consumer populous is not able to get the money to buy the products and services produced as a result of substituting machines for people. And yet you can’t have mass production without mass human consumption made possible by “customers with money.” It is the exponential disassociation of production and consumption that is the problem in the United States economy, and the reason that ordinary citizens must gain access to productive capital ownership to improve their economic well-being, not to a hand-out derived from government coercion that takes from those who make productive contributions as workers and capital owners and gives to those who are unable to earn a minimum sustainable income.
Binary economist Louis Kelso postulated: “When consumer earning power is systematically acquired in the course of the normal operations of the economy by people who need and want more consumer goods and services, the production of goods and services should rise to unprecedented levels; the quality and craftsmanship of goods and services, freed of the corner-cutting imposed by the chronic shortage of consumer purchasing power, should return to their former high levels; competition should be brisk; and the purchasing power of money should remain stable year after year.”
Without this necessary balance hopeless poverty, social alienation, and economic breakdown will persist, even though the American economy is ripe with the physical, technical, managerial, and engineering prerequisites for improving the lives of the 99 percent majority. Why? Because there is a crippling organizational malfunction that prevents making full use of the technological prowess that we have developed. The system does not fully facilitate connecting the majority of citizens, who have unsatisfied needs and wants, to the productive capital assets enabling productive efficiency and economic growth.
America has tried the Republican “cut spending, cut taxes, and cut ‘entitlements,’ eliminate government dependency and shift to private individual responsibility” and the Democrat “protect ‘entitlements,’ provide tax-payer supported stimulus, lower middle and working class taxes, tax the rich and redistribute” through government brands of economic policy, as well as a mixture of both. Republican ideology aims to revive hard-nosed laissez-faire appeals to hard-core conservatives but ignores the relevancy of healing the economy and halting the steady disintegration of the middle class and working poor.
Some conservative thinkers have acknowledged the damaging results of a laissez-faire ideology, which furthers the concentration of productive capital ownership. They are floundering in search of alternative thinking as they acknowledge the negative economic and social realities resulting from greed capitalism. This acknowledgment encompasses the realization that the troubling economic and social trends (global capitalism, free-trade doctrine, tectonic shifts in the technologies of production and the steady off-loading of American manufacturing and jobs) caused by continued concentrated ownership of productive capital will threaten the stability of contemporary liberal democracies and dethrone democratic ideology as it is now understood.
Without a policy shift to broaden productive capital ownership simultaneously with economic growth, further development of technology and globalization will undermine the American middle class and make it impossible for more than a minority of citizens to achieve middle-class status.
We are absent a national discussion of where consumers earn the money to buy products and services and the nature of capital ownership, and instead argue about policies to redistribute income or not to redistribute income. If Americans do not demand that the contenders for the office of the presidency of the United States, the Senate, and the Congress address these issues, we will have wasted the opportunity to steer the American economy in a direction that will broaden affluence. We have adequate resources, adequate knowhow, and adequate manpower to produce general affluence, but we need as a society to properly and efficiently manage these resources while protecting and enhancing the environment so that our productive capital capability is sustainable and renewable. Such issues are the proper concern of government because of the human damage inflicted on our social fabric as well as to economic growth in which every citizen is fairly included in the American dream.
Our current system is rigged to continually concentrate the ownership of capital in the 1 to 5 percent of the population. The current system is presently propelled by greed in our society, which creates dire moral implications. A new system that would ensure equal opportunity for every child, woman, and man to acquire productive capital with the earnings of capital and broaden its ownership universally does not require people to be any better than they presently are, but it does enable our society to leverage both greed and generosity in a way that honestly recognizes and harnesses productive capital as the factor that exponentially produces the wealth in a technologically advanced society.
The resulting impact of our current approaches has been plutocratic government and concentration of capital ownership, which denies every citizen his or her pursuit of economic happiness (property). Market-sourced income (through concentrated capital ownership) has concentrated in individuals and families who will not recycle it back through the market as payment for consumer products and services. They already have most of what they want and need so they invest their excess in new productive power, making them richer and richer through greater capital ownership. This is the source of the distributional bottleneck that makes the private property, market economy ever more dysfunctional. The symptoms of dysfunction are capital ownership concentration and inadequate consumer demand, the effects of which translate into poverty and economic insecurity for the 99 percent majority of people who depend entirely on wages from their labor or welfare and cannot survive more than a week or two without a paycheck. The production side of the economy is under-nourished and hobbled as a result.
While Americans believe in political democracy, political democracy will not work without a property-based free market system of economic democracy. The system is the problem, but it can and must be overhauled. The two prerequisites are political power, which is the power to make, interpret, administer, and enforce laws, and economic power, the power to produce products and services, whether through labor power or productive capital.
Kelso wrote: “In the distribution of social power, whether it be political power or economic power, all things are relative. The essence of economic democracy lies in the elimination of differences of earning power resulting from denial of equality of economic opportunity, particularly equal access to capital credit. Differences of economic status resulting from differences in advantages taken and uses made of differences based on inequality of economic opportunity, particularly those that give access to capital credit to the already capitalized and deny it to the non- or -undercapitalized, are flagrant violations of the constitutional rights of citizens in a democracy.”
We need a recognition in America that we should deliberately begin to broaden the capital ownership base in a way that is consistent with the laws of property and the Constitutional safeguards of the rights of men and women to own property and be productive.
What needs to be adjusted is the opportunity to produce, not the redistribution of income after it is produced.
The government should acknowledge its obligation to make productive capital ownership economically purchasable by capital-less Americans using insured, interest-free capital credit, and, as Kelso stated, “substantially assume financial responsibility for the economy through establishing and supervising the implementation of an economic, labor and business policy of democratized economic power.” Historically, capital has been the primary engine of industrialization. But as used, as Kelso has argued, has, as well, “been the chief cause of the institutional deformities that have created and maintained two incompatible classes: the overcapitalized and the undercapitalized.”
We cannot balance the budget without cutting out coerced taxpayer-dependent redistribution of the earnings of capital workers, which if we did at this juncture would collapse the economy and ruin lives, resulting in social strife, personal suffering and degradation, the erosion of freedom, and ultimately anarchy, which will bring on totalitarian government. While welfare, private charity, boondoggle employment and other redistribution measures are now seen as necessary, they do not have to be sustained indefinitely. There are policies that can be adopted and executed to reverse the ultimate direction of collapse of the American market economy system. Such policies are based on the recognition that as the production of products and services changes from labor intensive to capital intensive, the way in which every human being––not just a few, but every person––earns his or her income must change in the same way. At the core of this quiet revolution is the understanding and commitment to broadening the ownership of productive capital.
We need new justice-committed leaders, especially those who want to end the corruption built into our exclusionary system of monopoly capitalism––the main source of corruption of any political system, democratic or otherwise. We need to advocate the need to radically overhaul the Federal tax system and monetary policies and institute proposals to get money power to the 99 percent of American citizens who now only rely on their labor worker earnings. Under the Just Third Way’s (http://foreconomicjustice.org/?p=5797) more just and simple tax system, access to ownership of the means of production in the future would by provided to every child, woman and man by requiring the government to lift all existing legal and institutional barriers to private property stakes as a fundamental human right. The system was made by people and can be changed by people. Guided by the right principles of economic justice, “we the people” can organize and demand that the system be reorganized to make true economic democracy the new foundation for true political democracy. The result of this movement of new justice-committed leaders leaders and activists will be inclusive prosperity, inclusive opportunity, and inclusive economic justice.
